Embracing The Lean Startup Culture

lean startup
Source: Alexander Osterwalder and Yves Pigneur, creators of Lean Canvas

If you have been following entrepreneurship, starting a new business, or developing new products recently, you may have come across the term Lean Startup. Lean startup is transforming the Entrepreneur Space, and revolutionizing how businesses were built in the past five decades.

Lean Startup; What is It?

In 2011, Eric Ries created the lean startup concept as an alternative approach for entrepreneurs and corporate organizations to start new businesses and launch products faster. The concept was designed to ensure that entrepreneurs are able to launch new products and services that meet customer’s needs and wants. Lean Startup is a radical departure from traditional business-building approach, which leaned heavily on business plan.

As you may know already, MBA schools popularized business plan as a prominent tool for starting new businesses and launching new products. For more than five decades, everyone believed that to be the best route to start a new business or launch a product until recently. This conventional approach made us to believe that anyone can start a business with just an idea, then a business plan, a pitch to investors for finance, find a team to create and sell the product, and off to the market to sell the product or service. That was the trends for many years, and the result over those past years has been fatal loss for most entrepreneurs and small business owners. What we have now learned over these years is that business plan is not relevant for startups and new product development.

Traditional startup approach

Why Startup Businesses Fail

According to recent study by Harvard Business School’s Shikhar Ghosh, 75% of all startups fail. This means that only 25% of new businesses and products manage to survive. The question everybody asks, which I will answer in this post is “Why does a staggering 75% of all startup businesses fail?”

Here’s the key. In the past, entrepreneurs were deceived to build businesses by writing up business plans straight from their ideas. So as soon as a business idea drops in their head, the spend several weeks or months writing a compelling business plan. With their business plan to hand, they are off to investors pitching for money. Whoever finds favour with an investor begins to develop his or her product or service with their team without saying a word to the customer until they complete what they are building. Many entrepreneurs were taught along the way to fixate too much on idea and passion as the two most important ingredients for business success. So they “passionately” build the product with no input from the customer and go straight to the market to sell. For great majority of entrepreneurs, this is the exit point for them. While trying too hard to sell what they build, suddenly the golden light bulb lights…. sadly the customer does not like what they invested enormous amount of time, effort and money to build.

The important lesson we learned after many years of watching several startups and new products fail is this:

Startup Businesses fail not because their founders did not build what they had in mind, but because they built what no one in the market wanted to buy.

Why Lean Startup Culture?

A lean startup culture is a combination of habits, thinking, behaviour and approach that  entrepreneurs and business executives adopt in starting new businesses, and launching new products and services faster without wasting time or money. Unlike the traditional approach of building business, Lean Startup Culture relies heavily on ‘Customer Insights’ as a crucial factor for providing invaluable solutions that meet their wants and needs.

The lean start-up culture concepts suggest that rather than wasting time, money and effort building what the customer does not want, start-up founders and corporate organizations should fixate on creating, testing, iterating and pivoting hypotheses to first find a fit for their product or service in the market, and ensure that customers will pay for them.

For this to become a reality, smart entrepreneurs and corporate organizations need to embrace a new culture – the Lean Culture. Lean culture leverages comprehensive proven concepts and tools to develop business models and create Minimum Viable Product (MVP). While business model aims to commercialize founder’s ideas, MVP translates ideas into prototypes with sufficient features which customers can pay for or use in exchange for feedback. Feedback is an important lean culture approach used to improve (iterate) the MVP already produced, or pivot (make major changes on) the business model.

Lean Startup Culture Design
Adopted from Steve Blank

In a nutshell, a lean culture approach to starting a business or developing new products involves to:

  1. Find an idea,
  2. Form hypotheses and build a lean business model,
  3. Create MVP, test and validate hypotheses with customers, and
  4. Improve features based on feedback; if not, then pivot hypotheses

Lean culture eliminates waste, reduces product cycle and facilitates building of products or services that meet customer needs and wants. Lean startup culture raises the odds of success for entrepreneurs and corporate organizations. This is the way forward for smart entrepreneurs.

Nkem Mpamah is President and Founder of  Cognition Global Concepts Limited Cambridge. Nkem helps ambitious entrepreneurs and business executives to double productivity and profits. He is Creator of The EntreCoach™ Program, a comprehensive Lean Business Coaching Tool  for multiplying producitivity and profit.

What Type of Entrepreneur Are You?

The EntreCoach

It is exciting to be a successful entrepreneur. Regardless the price, entrepreneurs enjoy huge freedoms that drive their behaviour for what they do, and results they achieve. Nevertheless, the primary motive for entrepreneurship is not money. The purpose is freedom; freedom to create the highest value in the marketplace that meets people’s needs and resolves their pains and fears.

Sadly, despite the proliferation of various business coaching and executive leadership development tools in the marketplace, many entrepreneurs have failed to reach the goals that initially brought them to entrepreneurship. While many get buried in day-to-day office administration, great majority of others are stuck in different complex ceilings of limitation that constantly sabotages their progress no matter how hard they try.

The reason is obvious; we’ve experienced increasing trend in innovation and creativity especially in the areas of technology, business strategy, and marketing; not to mention various complex leadership development concepts that negatively impact execution, accountability, and productivity.

I’d like to explain these in more detail and highlight few things you can do to double your productivity and revenue consistently; but first, let us consider the various types of entrepreneurs and identify which type you are.

There are three basic types of entrepreneurs: the survival entrepreneur, lifestyle entrepreneur, and Accelerator. Each type plays a unique role in creating the outcomes they achieve and the freedoms they enjoy.

For example…;

1. The survival entrepreneur is the individual that quits his/her job of working for someone else and starts working for himself. In reality, this person hasn’t created a business yet, but only replaced his former job with one he created that gives him privilege of being “the boss” even though he or she works extreme long hours.

2. Lifestyle entrepreneurs are individuals, who have clear expectations of how much value they want to bring to the marketplace. They also have expectation to enjoy some levels of freedoms, which to them includes exotic cars, posh homes in choice areas, elite club membership, or best schools for their children. The challenge with Lifestyle Entrepreneurs is; unless their goals and accomplishments constantly exceed their expectation from the marketplace, they would struggle.

3. Accelerator is the entrepreneur whose primary objective is to continually deliver great value in the marketplace, which in turn creates multiple opportunities that not only grow his or her business, also the level of freedoms they enjoy. An Accelerator never stops at any given achievement. As he or she reaches one set of goals, they accelerate to another higher one. By building on past experiences and leveraging teamwork support from employees and powerful network of quantum relationships, they make the game of entrepreneurship fun and interesting.

The biggest challenge Accelerators face is how to manage the increasing complexities that grow along with their business growth. Nevertheless, by focusing on building a Self-Sustaining Enterprise, a business that grows without owners involvement in its day-to-day operation, they are able to overcome their complexities and create 10x possibilities consistently.

In my experience as creator of The EntreCoach™ Program – a comprehensive support system that offers exclusive business coaching, leadership development, and teamwork tools for ambitious entrepreneurs to create unimaginable results and accelerate growth; the simple best way I have found for running highly successful entrepreneurship that delivers such great rewards and freedom is by building a self-sustaining enterprise.

Regardless the type of entrepreneur you are presently, you can decide now to lay the foundation that could transform your business to create extraordinary results. It begins with making your vision 10x bigger, clearer and compelling. It also means focusing only on the aspect of your business that you love doing, that produces the highest satisfaction and reward, both for you and the business.

Learning about how to build a self-sustaining enterprise begins with a Free Business Strategy Workshop at Cognition Global Concepts, for ambitious entrepreneurs to experience the exclusive business coaching and leadership development tools and concepts they can use to make 10x possibilities a reality.

Nkem Paul is executive business coach that helps entrepreneurs and business organisations double productivity and revenue, and build Self-Sustaining Enterprises. He’s founder and CEO of Cognition Global Concepts and Creator of The EntreCoach™ Program. For more details, attend The EntreCoach Free Business Strategy Workshops.

If Your Business Is Not Growing, You’re In Serious Trouble

growth

The old axiom, “The only constant is change” holds true for business and life. For both, if you are not experiencing growth, you’re possibly dying.

In business, the growth potential of entrepreneurs and leaders of organizations are sometimes challenged when they lose customers, followers or best talents. Regardless of how massive your customer base may be; this is a sad event to experience.  But People’s preferences change; what they like today, they tend to dislike next week. Others move from places near you to distant locations, making it impossible for you to enjoy their custom any more. Change in demography also occurs and each of these factors impacts the growth of your business positively or negatively.

Sadly, many entrepreneurs and business leaders are not proactive. They’re hard-wired to adapting to changing situations. If your business is doing well today, praise God; but what if a major client leaves tomorrow, a great employee resigns or a major credit line discontinued? Like every one else, you immediate response would be to replace them right?

Consider your business or organization as a car having comprehensive insurance cover, what would you do if those risks occur? Implementing some contingencies to regularly check on your stability and provide support for you and your business operations will definitely save you some troubles in the long run.

Nowadays, It is no news hearing people talk about “Plan B”, but let’s face the fact, do you have one in place? If you do, are you implementing it right now?

My experience of working with entrepreneurs and business executives tells me that majority of them know exactly what they should be doing. I guess that’s the case with you also. But the trouble is that they don’t know where to begin, what to do first, second or third. Some of them that know have no time to actually do it.

Succeeding in life and business is like falling in love with your wife (for those of you that are married). You can’t leave your wife at the mercy of another man and feel safe. Delegation is great and I highly recommend it; but when delegating major activities, be sure you are in control.

If you are ambitious about growing your business, or nursing a feeling that your business should grow more, here are some suggestions I teach my clients at Business Mastery Summit.

1. Develop crystal clear vision of where your business is headed.

If you were going to somewhere you don’t know, one of two things would likely happen… You might end up in a wrong destination, or waste your time and resources in futility.

You need to first develop clarity about your vision for the future of your business; where you and everyone in your organization are excited about reaching. Regardless of your current situation, your vision will keep you excited against the temporal dissatisfaction that current reality brings. Not doing this one thing first may cost you a fortune.

2. Get organized and take control

There are more distractions and complexities in life and business today than we have experienced in the past. Unfortunately, there seems to be no guarantee that the situation is going to get any better in future.

Having this in mind, it’s important to know that you can’t grow your business in the midst of complexities. This is quite a challenge for many entrepreneurs who are already experiencing distractions from social media platforms, unwanted emails, and hopeless media reports about worsening economies.

Successful people are highly organized. If your house is not in order, your mind will not be at rest. If you have important un-responded emails, unattended calls, pending reports to write, or meetings to attend, every one of these will definitely get in your way of growing your business. You need to get organized, clear all your messes, prioritize your time for the tasks that give you the most benefit, and then focus on them relentlessly.

3. Develop a success plan

If you are a small or medium size business, your success plan is the same as strategic plan for large corporations. It serves the same purpose that a GPS System would for navigating your business successfully.

As I mentioned earlier, many entrepreneurs don’t take action because they don’t know what to do first, second or third. Your success plan contains all the options you consider “most important,” plus the step-by-step approach you must take in achieving them. If you have a success plan with you, and implement it, you’ll become practically unstoppable and experience consistent growth.

About the author: Nkem Mpamah is founder and CEO of Cognition Global Concepts, specializing in helping entrepreneurs and business leaders develop the capacity to double productivity, increase revenue and deliver superior customer service through coaching, leadership training and strategy consulting. If you’ve found this piece useful and need some insights to accelerate your business growth, you can visit their website at www.cognitionglobal.com/business-mastery-summit or email him at info@cognitionglobal.com