Or: Principles of Minimum Viable Product
One of the biggest parts of business is providing a product or service. Once you’ve decided what problem you would like to try to solve, the next step is developing the solution. Whether your solution is delivered as a product or a service, there will come a point where you have to release your product or service into the market. So, how long should you develop your product before you release? How small can your service be before you start selling? These are important questions, but there is a single key question that underlies all questions of this type.
Where and how is value created?
If your social enterprise can be creating value immediately with a small part of the product you are building, then why would you wait for a “full package” to start selling that solution? What is stopping you from providing that small solution while you develop the rest of a complete solution?
This is the foundation of lean principles and the minimum viable product (MVP) (source – The Lean Startup by Eric Reis). You start with an idea for a solution. Once you have the idea, you create an experiment: a set of conditions that will indicate if the product works or not. Then you prototype the smallest version of the product possible and release it to a select group of people who have the problem you’re trying to solve. Once you have enough people who have tried it, you evaluate what happened. Did the potential customers find it useful? Did they actually use it? Would they continue using it? Based on the data you collect, decide whether you need to keep developing your solution, or if you need to change how you approach creating a solution. The cycle then repeats.
This is known as the minimum viable product cycle. Start with an idea about how to solve a problem and build a prototype. Create an experiment and define what success is for this version. Launch the prototype to a group of people who have the problem you are solving. Evaluate based on your definition of success and decide whether to persevere and refine your current solution or to pivot and adjust the strategy or approach the problem from a different angle.
The point of minimum viable product cycles are that each time you go through the cycle you will learn whether or not your solution is effective in providing value.
For example, you’ve got a workshop that you’re creating to help new immigrants find out where they need to go and what they need to receive IDs and other critical materials for living in your country. If you follow the standard development model, you would create an outline of what the immigrants that you know have needed. You might also be basing the workshop on experiences that you or your family have had.
Using the standard development model, you would spend a month collecting resources and creating information sheets that you would hand out at the workshop. Only after the full month of work would you present this for the first time to a group of new immigrants to see how it works. You might talk through the content of the workshop a couple times with trusted advisors and a test group or two, but the bulk of the workshop would be new.
If you were to use a minimum viable product approach to the same workshop, You would take a couple of days to a week lining up information on one key aspect, say getting a driver’s licence. Once you have enough information to present how to get a driver’s licence effectively, you would need to define the success condition for your experiment. This could be either the percentage of attendees who end up getting a licence, or the number of immigrant support organizations who request additional workshops. With the objectives in place it is time to run a couple of sessions of the “everything you need to know to get your drivers licence workshop” with a special offer for a select group of support organizations.
Based on the reactions and feedback of those who attended the first session, you would measure how you did compared to your objective. Using this new information and other lessons you learned through giving the first set of workshops you need to decide whether it is worth developing this workshop further and bringing it closer to your initial vision, or if it makes more sense to shift the direction that development takes.
In this example, we’ll say that people liked the initial session, but found that they still had difficulty finding ways to get to where they needed to go after the session. For the next iteration of the workshop you could rent a van and use it to transport the participants to the offices where they submit their drivers licence application. You could include labelled maps that are provided to participants. You could also start expanding your offering to include different kinds of ID or legal documents.
This illustrates why the minimum viable product is important. Without the minimum viable product, it is possible that your product or service will succeed, but you have a lot more time and effort being given to an unknown and untested result. As you develop and create new versions of your MVP you will be finding out more information about what works and what should be cut from your product. This reduces the risk of each step of development, as it will either be found useful, or you will find out quickly that you don’t need that feature.
The best part of the minimum viable product is that when you find a piece that works, you get paid as you develop it further. One of the markers of success for an MVP is that people like your small solution to their problem that they will pay for that single part, separate from the full package you first imagined. The people who support you with your small solution are also more likely to eventually purchase your full package, as they likely have other related problems that your full solution will solve.
If you find that several versions of your minimum viable product is not working, and you must pivot, that is a sign that you should rethink the key assumptions behind your product. In the above workshop example, the key assumptions were that new immigrants have a hard time getting ID, and that there are people or organizations that are willing to pay to help people get ID.
The most important part of the minimum viable product cycle is that you get through it as quickly as possible to make sure you have the most opportunities to learn. Each full cycle should take about a week, and not longer than a month. With small organizations it is also best to test only one aspect of your product at a time. This way you can tell what difference your changes are making in isolation.
This process works with existing products and services too. You can use MVP techniques to gradually improve your products. You can increase signup rates, increase retention, encourage repeat customers, and to improve your internal processes with thoughtful and creative use of MVPs.
Now go, gather ideas, figure out your first experiment and decide what it means for your MVP to succeed.
Just remember, it’s a minimum viable product, so keep it simple.
P.S. I will also be creating a minimum viable product for a Social Enterprise marketing class. The first version will be released July 19th at a reduced price with free lifetime updates. If you are interested in getting in on the discounted intro rate, you can sign up for updates here:
P.P.S. The marketing class advertised here was scrapped due to low engagement. This is why minimum viable products are important. I’ve left the P.S. announcement for transparency.
Keep it Simple!