A Start-up is greater than the sum of its parts; it is an acutely human enterprise.
The fact that a start up’s product or service is a new innovation is also an essential part of the definition. Anything customers experience from their interaction with a company should be considered part of the companies product.
The future is unpredictable, customers face a growing array of alternatives, and the pace of change is ever increasing. Yet most startup’s – in garages and enterprise alike – still are managed by using standard forecasts, product milestones, and detailed business plans.
Innovation is a bottoms-up, decentralised, and unpredictable thing, but that doesn’t mean it cannot be managed. It requires a new management discipline, one that needs to be mastered.
The amount of learning they get is just immense. This develops entrepreneurs, because when you have only one test, you don’t have entrepreneurs, you have politicians because you have to sell. When you have 500 tests you’re running, then everyone’s idea can run.
A companies only sustainable path to long-term economic growth is to build an “innovation factory” that uses Lean Startup techniques to create disruptive innovations on a continuous basis.
An example of holding accountability for new innovations was to measure two things: the number of customers using products that didn’t exist three years ago and the percentage of revenue coming from offerings that did not exist three years ago.
They chose this because it use to take an average of 5.5 years for a successful new product to start generating $50 million in revenue.
Kill things that don’t make sense fast and doubling down on the ones that do.
Developing experimentation systems is the responsibility of senior management; they have to be put in by leadership. It’s moving leaders from playing Caesars with their thumbs up and down on every idea to – instead – putting in a culture and the systems so that teams can move and innovate at the speed of the experimentation system.