The Lean Startup movement, a product development process with close ties to agile, has been increasingly applied in situations far beyond what the moniker might suggest. The FDA, GE and Intuit are just a few examples of distinctly non-startup organizations that have embraced Lean Startup methods. What are the reasons behind their interest, and what are the differences between small and large company adoption?

The Lean Startup Process in a Nutshell

The essence of the Lean Startup can be boiled down to:

  • Clear, short-term experiments
    Your stories test hypotheses.
  • Direct customer interaction
    “Get out of the building.”
  • Release planning informed by both qualitative & quantitative feedback
    Observation, interviews & metrics.
  • Rapid, frequent & high quality agile delivery
    Deliver small, focused batches of features early and often.

The Lean Connection

Being “lean” in this case refers to putting together the cheapest, fastest experiments you can manage, in order to test the core premises of your project over time. In other words, every sprint and every story is in some way an experiment, which will ostensibly provide valuable new data to guide your ongoing prioritization and backlog evolution.

The Enterprise Angle

Any company entering a new niche, whether established or otherwise, must learn new things in order to plan and manage properly.  The Lean Startup process focuses on mitigating the various risks that arise over the course of any new product development effort, such as:

  • Are we solving real, substantial problems?
  • Who exactly has these problems, and would our proposed solution be great enough that they’d pay a worthwhile price for it?
  • Are there any technical risks that we need to tease out and address?

Given then that the need for innovation and transparent risk management can be just as important in a large organization as in a small one, where are a few common areas of impact and concern?

  • Portfolio management – The Lean Startup provides quantitative ways to measure progress against specific goals, providing guidance on when to “pivot” (change direction), invest more or stop projects. Rapid deliveries mean tighter feedback loops, which implies different PMO structures and cadences, for instance.
  • Resource management – As with agile methods, setting up and managing long-term dedicated teams is quite different from the norm for many companies. Proper balance of functional management and skills development with cross-functional teams is a necessity.
  • Brand management – Much less of a concern for startups is the possibility of reputation damage from failed experiments. Large organizations might use spin-off brands, or target high quality constrained availability releases just to early adopters, noting the pilot nature of the projects.
  • Quality management – The “Minimum Viable Product” release strategy preferred by the Lean Startup movement is often implied to be a quality trade-off. This need not be true; as with agile, the focus is on building just a few features at a time (enough to satisfy some real need), but crafting them well. Regulatory considerations and the like should be addressed openly and drive the “definition of done” as appropriate.

A Worthwhile Challenge

So, big companies can use Lean Startup approaches as a way to form innovative product incubators, and to evolve their iterative and incremental development capabilities in general. Their natural inertia means that such efforts may well require a bit more oversight and patience in early stages, but in the long run, the challenges are much the same as with other agile methods, and these have been proven assailable for companies with the drive and will to adopt them.

Questions?