It was a misty Tuesday morning at an executive retreat for a company in the early stages of a tailspin. The mist was an apt metaphor, because the competitive marketplace seemed so opaque. While they could see all sorts of developments, they just could not fathom which one was going to bite them next. What they did know was that their competitors were moving so quickly that they were getting product to market up to 2 years late. In essence, by the time they got to the ball park, the game had already been forfeited.
Art of the possible
The leadership team had plenty of reasons to bemoan their fate. Their technology was clumsy and slow to evolve. Their culture was staid and morose. Their middle management did not know how to manage change. And so the list went on. All of their complaints were valid. Most importantly, with financial resources limited, and the assaults on the market so varied, they did not know how to prioritise their investment opportunities.
Yet leadership is in the art of the possible. It is about finding a pathway to victory in spite of the seemingly insurmountable obstacles. It is this that explains the popularity of Minimum Viable Product (MVP) thinking in the strategic postures of innovative CEOs.
This concept, popularised by Eric Ries in his book The Lean Startup, is a manifesto to start small but move fast. It is an approach to learning about the customer need with real products and services, but moving quickly with a view to testing hypotheses before refining the product further.
The MVP paradigm
This simple set of concepts very much reflects scientific method: develop hypotheses about the customer need; test them; and adjust accordingly. What is different about MVP is the desire to test with a real product in a real marketplace, rather than get stuck in a long market research cycle. In the MVP paradigm, the best way to test an idea is with a real product and with a real customer. Yet, as the name MVP reflects, you need to do this cheaply. You don’t spend the big bucks until you know there is a real and economically viable opportunity. If you need to you use people with pens, paper and calculators behind the website, then do so.
So, let’s get back to our company in the early stages of a tailspin. My advisory team introduced them to MVP thinking. They loved it and they hated it. They loved the possibility of learning faster. They hated the sense of risk that came with moving to market, even in a small way, without the myriad of checks and balances that they utilise for full scale investments. They loved the opportunity to engage staff, but they hated the possibility of leaving unfinished products in the marketplace. They were really nervous that they would be insufficiently disciplined. For if MVP is not applied in a disciplined manner it just creates a rabble-like scramble to market with an incomplete product. They understood that MVP is a discipline.
Yet ultimately they concluded that with such a morbidly slow product development history, they needed to act. So act they did. They chose and initiated 4 MVP initiatives. Two of these were ultimately closed because the customer propositions underpinning them proved to simply be wrong. Two MVP initiatives launched, adjusted after learning from customer feedback, and relaunched having more confidently invested in a scalable approach. They scored hits with both products.
MVP did not save the company, but it did help. It gave them a way to learn and launch faster. It lifted morale when they were starting to feel like yesterday’s news. It also forced them to be disciplined about closing down failures, and properly finishing successes. CEOs love these characteristics of MVP thinking, but they hate that they need to be constantly alert about maintaining the right MVP disciplines. MVP is not a free-for-all rush to the market with incomplete product. It is a thoughtful, but rapid, engagement with customers to learn using actual experience. At the end of the day, nothing works better than trying the real thing.