The Lean Startup

FABRIKAM RESIDENCES
Book review by
IRE Group 6
Introduction
• Lean Startup is a methodology designed to validate a business hypothesis through short
and rapid release cycles of product features, business models, and strategies. The concept
is designed to reduce market risk by validating learning through the release of a
Minimum Viable Product.
• The Book is divided into three Sections
1) Vision
2) Steer
3) Accelerate

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Vision
A w a y t o fi n d I f t h e y a r e m a k i n g p r o g r e s s ,
validated learning and how to build a sustainable
business
• Cross Functional Teams – Team that consists of experts from various
departments. It helps to reduce the cycle time, which improves the
process.
• Engine of growth: Build-measure-Feedback-loop.
• validated learning - It is a rigorous method for demonstrating
progress when one is embedded in the soil of extreme uncertainty in
which startups grow. Validated learning is the process of
demonstrating empirically that a team has discovered valuable truths
about a startup’s present and future business prospects.
• Innovating the product blindly leads to tragedy. Because the
innovation was never needed by the customers, Always think about
whether the product is in demand and needed by the customers

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 Vision FR
Vision can be broken down into two parts of the hypothesis
• Value hypothesis – The value hypothesis tests whether a product or service really
delivers value to customers once they are using it.
• Growth hypothesis – For the growth hypothesis, tests how new customers will
discover a product or service,
• Concierge minimum viable product: this specification will be rooted in feedback on
what is working today rather than in anticipation of what might work tomorrow.

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Steer
LEAP
• Strategy is based on Assumptions: Traditional management helps managers to identify assumptions.
• Assumptions are the leap of faith. Leap of faith formed by analogy statements.
• Value and growth: the first step of understanding every product is to check whether they provide value or not.
There are false startups and true start-ups, Innovation accounting helps to differentiate them.
• GENCHI GEMBUTSU - “go and see for yourself” : If you want to understand a problem go and see it for yourself.
• Analysis paralysis: Most entrepreneurs think that they are getting the right data by having simple conversations
with people while the people don’t even know what they want. It is because they don’t follow sound strategic
principles
• To conclude the analyzing stage they should have subtle conversations with the consumers.

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STEER
TEST
• Testing the product starts with the Minimum Viable Product
• Minimum viable product helps entrepreneurs to test the hypothesis. it starts the learning process soon and helps
to do the build measure learn feedback loophole with minimum effort.
• Minimum viable products range in complexity from extremely simple smoke tests (little more than an
advertisement) to actual early prototypes complete with problems and missing features.
• The lesson of the MVP is that any additional work beyond what was required to start learning is waste, no matter
how important it might have seemed at the time.
Measure
• Cohorts and split tests :
Cohort analysis -  is a kind of behavioral analytics that breaks the data in a data set into related groups before
analysis.
Split test – diff versions of products offered to customers at the same time. then u will be giving two diff products
to two diff customers. You can get the feedback and the impact of the two diff variations.

• Kanban: It is the process of prioritizing the user stories that need to be tested and validated. The story will only be
removed after validation. If the story fails then it is considered to bad idea.
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 STEER
• The Value of the three A’s:
• Actionable – A report should demonstrate clear, cause and effect.
• Accessible – People had the access to the files. If they need evidence to support what they learn they
have the access to the files that support the evidence in the company
• Auditable – Ensure that the data is credible to employees. If managers want to find why people
behave differently for a certain products they should be able to spot check the data with real
customers.
PIVOT
• It requires vision, intuition, and judgment to understand when sufficient progress against the original hypothesis isn’t
being met, and a pivot is required.
• As the result of the Build-Measure-Learn-Feedback loop concept If the company is on the right track they don’t need
to pivot it they can persevere or else they should pivot.
• A pivot isn’t just a change — it is better understood as a new strategic hypothesis that will require a new minimum
viable product to test.

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Accelerate FR
Batch
• To reduce the cycle time of the build-measure-learn-feedback loop concept we need to carry on the process
as batches.
• Create speed and small batches by establishing cross-functional teams to work together to rapidly deliver an
MVP increment through the Build-Measure-Learn loop.
• It helps us in reducing the time, saving money and improves productivity.

Growth
• Growth of the company happens when we get new customers. There are 4 ways that we can get new customers. They are
1) Word of Mouth
2) As a side effect of product usage
3) Fund advertising
4) Through repeat purchase
• Engine growth refers to the growth of the company. There are three types of engine growth.
1) Sticky engine - need to track attrition rate/churn rate carefully. If customer acquisition exceed churn, the business is
growing. Focus on creating incentives for customers to stay.
2) Viral engine – each customer has to bring another customer to get the service or to experience the product
3) Paid engine - Paid growth has the goal to keep the cost per acquisition (CPA) of customers as low as
possible,
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ACCELERATE
ADAPT
• The goal is to build an adaptive organization — one that automatically adjusts its processes and performance to current
conditions
• You cannot trade quality for time — the quality sacrifices you make now will cause defects that slow you down in the
future.
• The key is finding a balance between quality and speed, adapting to the needs of the organization at any given time
using the Five Whys.
• If we face a problem by asking questions using why we could end up in the root cause of the problem at the 5 th why.
Innovate
• You will need to protect the parent organization from the startup by creating an innovation sandbox — constraining the
impact of innovation, but not constraining the methods.
• Innovation sandboxes allow any team to create an A/B test that affects a sandboxed part of a product or service.

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CONCLUSION
The Lean Startup is a framework, not
a blueprint of steps to follow. It is
designed to be adapted to the
conditions of each specific company.

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THANK YOU
PROBLEM STATEMENT
 PROBLEM

CONTEXT 80% of Efforts are Waste, Hampering ALTERNATIVES

Productivity and less conversion ratio
Currently creating manual databases or
8 TO 10 Days in every cycle finding potential candidates from portals

EMOTIONAL IMPACT
Frustrated

ALTERNATIVE SHORT COMES

CUSTOMERS Getting profiles from portals as Candidate
QUANTIFIABLE IMPACT expectations and company expectations
All Recruiters Loss of Minimum 8 to 12 Days are not matching
 PROBLEM ALTERNATIVES
CONTEXT

Everyday 1 – 2 Hours Per day Get the things either from online grocery story
Lose of time in collect food materials and cutting or Order food Everyday or Eat Outside
instead doing more valuable

EMOTIONAL IMPACT
Irritated and Tied

ALTERNATIVE SHORTCOMES

CUSTOMERS
After ordering from online store; confusion
regarding quantity and take time to cut the
vegetables
All Busy working people

QUANTIFIABLE IMPACT
Lose on average 30 to 45 Hours a Month
 ALTERNATIVES
PROBLEM
CONTEXT Waiting time is more to get order deliver Currently doing online shopping or visit to
Waiting for a day or two to get delivery and instead of getting in 1-3 hours nearby store

EMOTIONAL IMPACT
Disappointed

Alternative Short comes

CUSTOMERS Shopping in Online requires time to

QUANTIFIABLE IMPACT deliver and sometimes it might get delay
All Fashion Enthusiastic Lose of time everytime
Hypothesis
• It is Time Saving
• Provides all groceries for preparing tea to biryani on a customized wide variety
• We will design a smart search engine filters, It will direct you to get
what you want

Minimum Viable Product

• Creates user friendly app
• Select the cuisine and customize it to help save time
• Provides the excellent payment gateway