Presentation for Sydney Project Managers' Meetup. Compare and contrast between Lean Startup and tradiitonal project management in a product development context.

1. Lean Startup For
Project Managers
Project Managers Meetup Dec 2012
By Caroline Gordon
@carolineggordon
carolineggordon.com
Thursday, 7 March 13

2. Me
Engineer -> Manager
Project Manager / Development Manager
15+ yrs
Product Companies
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3. Some of the
different stuff
I helped create
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4. Thursday, 7 March 13

5. Lean Startup
On the surface
A risk management technique
Context:
Very high uncertainty
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6. Thursday, 7 March 13

7. Lean Startup
In its essence
A totally new way to manage,
track, and deliver
A Mindshift...
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8. Inputs
“Traditional Project Management” PMBOK -
The Project Management Institute (PMI)
Project Management Body of Knowledge. A
flexible guide to managing projects. Basis
of PMP Certification.
Lean Startup - Book by Eric Reis, subject
of many blogs, workshops (Lean Startup
Machine), conferences
Me
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9. What is a startup?
A startup is a human institution
designed to create a new product or
service under conditions of extreme
uncertainty
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10. What is a startup?
A startup is a human institution
designed to create a new product or
service under conditions of extreme
uncertainty
What is a project?
A project is a temporary endeavor undertaken
to create a unique product, service, or
result.
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11. Thursday, 7 March 13

12. Staffing level for a lean startup
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13. Lean Startup
4 questions:
1.Do customers have the problem?
2.If there was a solution would they buy
it?
3.Would they buy it from us?
4.Can we build a solution for that
problem?
Traditional Project
Product Manager - “I want this”
Development Team - Build It
(straight to step 4)
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14. Lean Startup
4 questions:
1.Do customers have the problem?
2.If there was a solution would they buy
it?
3.Would they buy it from us?
4.Can we build a solution for that
problem?
Traditional Project
Product Manager - “I want this”
Development Team - Build It
(straight to step 4)
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15. Traditional Project Management
Product Manager Project Team
Study the problem and
conceive the solution Working on other projects
Build business model
Build an estimate- incl
Write Marketing
analyse build risks and add
Requirements Document
activities
Get project Approved - customer problem, high level solution
and business model do not change after here
Engage with the team to refine
Iteratively build the solution
functionality
Deliver the product -cycle time - months, years
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16. Lean Startup
Product Manager Project Team
Study the problem and
conceive the solution Test the assumptions in the
model with customers
Build business model
Build - measure - learn
cycle time - hours, days, weeks
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17. Vision: Overarching goal
Strategy: Business model, customer
proposition
Product: Solution to customer
problem
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18. Projects -
this part is
fixed after
planning and
initiation
phases
Vision: Overarching goal
Strategy: Business model, customer
proposition
Product: Solution to customer
problem
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19. Build-Measure-Learn Loop
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20. Startup:
Series of experiments looking for
invalidation of assumptions.
Invalidation - > Pivot
Change business model, customer
proposition
Project:
Success is defined by how close you
meet project objectives.
If any invalidation comes to light:
cancel the project
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21. Risk Based Project Management:
✓risk analysis of building the product
✓add activities to reduce risk
✓sequence activities according to level
of risk, focus on biggest risks early
✓reduce risk early
Lean Startup
✓risk analysis expands to the business
model and customer
✓add activities to scientifically prove
your assumptions (remove the risks)
✓start with the biggest risk - will be
around the business model / customer
✓reduce risk early
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22. Risk Based Project Management:
✓risk analysis of building the product
✓add activities to reduce risk
✓sequence activities according to level
of risk, focus on biggest risks early
✓reduce risk early
Lean Startup
✓risk analysis expands to the business
model and customer
✓add activities to scientifically prove
your assumptions (remove the risks)
✓start with the biggest risk - will be
around the business model / customer
✓reduce risk early
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23. Initial Activities to reduce risk:
Project Management
✓build a prototype
✓engage stakeholders
✓understand requirements
Lean Startup
✓validate your assumptions that the
problem exists
✓validate your assumption that your
solution will solve the problem
✓look for better solutions
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24. Initial Activities to reduce risk:
Project Management
✓build a prototype
✓engage stakeholders
✓understand requirements
Lean Startup
✓validate your assumptions that the
problem exists
✓validate your assumption that your
solution will solve the problem
✓look for better solutions
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25. Intuit
Example - Intuit. 20 year old company
around 2002, it’s new products had a
poor success record.
TurboTax had one major release per
year.
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26. Intuit
Fast forward to lean startup they had
over 500 changes in 2.5 month tax
season, each one built, deployed,
tested and learning gathered in 1
week - 70 tests per week.
Key metrics for the enterprise -
number of customers using products
that didn’t exist 3 years ago and
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27. Intuit
Last 5 years average annual revenue
increase of 10%
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28. Mind Shifts
When you have only 1 test - the ‘project’ you
have to sell all through the project - you are
always ‘selling’ the idea
Out of 100 good ideas you’ve got to sell your
idea (the project). So you build up an
organisation of politicians and sales people
When you have 500 tests you are running, then
everybody’s ideas can run and then you create
entrepreneurs who can learn and adapt instead of
politicians
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29. Mind Shifts...
Leaders and middle managers (project managers!)
think that they are analysts and their job is
to do great analysis and create the right plan
The leaders (project manager’s) job now is to
get their idea in the hands of customers as
soon as possible and let them vote on what
works
Intuit - Cook
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30. “It’s moving leaders from playing Caesar
with their thumbs up or down on every idea
to - instead putting in the culture and
systems so that teams can move and
innovate at the speed of the
experimentation system”
Intuit Founder - Scott Cook
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31. More mind shifts!
Innovation is a bottom up decentralised and
unpredictable thing but that doesn’t mean it
can’t be managed - it can but it requires a whole
new discipline
Established companies have less time than ever to
dominate with a successful product - they have to
create Innovation Factories following Lean
Startup principles to create disruptive
innovations continuously -
The challenge - do it on an Enterprise Scale with
managers schooled in traditional management
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32. How to validate quickly - example
- Lean Startup Machine Weekend
1 weekend to validate a business idea:
✓customer hypothesis - who are they?
✓problem hypothesis - what is their problem?
✓assumptions - what am I assuming?
✓riskiest assumption - test
How to test: “get out of the building”
✓Customer interviews
✓Online surveys
✓Online sign up page
✓Decide your target metric before you start -> 8/10 people must
agree that..
✓Not selling ... seeking to understand
Validated or not (metric based) -> pivot or persevere
✓Next riskiest assumption...test
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33. Compared to
Traditional project approach:
market research, customer interviews,
develop customer proposition
business model
hand to development team
iterate solution -> NOT iterating business
model or customer value proposition
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34. Innovation Accounting - a
new management paradigm
3 steps:
1.Baseline: Use MVP (minimum viable
product) to establish real data on where
you are now
2.Tuning the engine: changes that must
improve basic metric (eg sign up rate)
3.Learn: Pivot or persevere
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35. Thursday, 7 March 13

36. Customer
Problem
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37. Customer
Problem
Assumption Assumption Assumption
Riskiest
Assumption
Assumption
Assumption Assumption
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38. Customer
Problem
Riskiest
Assumption Assumption Assumption Assumption
Assumption
Assumption Assumption
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39. Customer
Problem
Riskiest
Assumption Assumption Assumption Assumption
Assumption Method
Assumption Assumption
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40. Customer
Problem
Riskiest
Assumption Assumption Assumption Assumption
Assumption Method
Minimum
Assumption Assumption Success
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41. Customer
Problem
Riskiest
Assumption Assumption Assumption
Assumption
Assumption Method
Minimum
Assumption Assumption Success
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42. Customer
Problem
Riskiest
Assumption
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43. Different
Customer Customer
Same
Problem Problem
Riskiest
Assumption
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44. Validation boards
Lean Startup Machine – invite only for
online, but you can download a nice version
and use it locally. Follows the Lean Startup
Machine model of assumption vaildation.
Lean Canvas - follows lean startup
principles, supports multiple boards for each
segment of your idea and click through for
experiments and results – very nice
Lean Launch Lab – includes some nice features
like recording customer interviews
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45. More books - Escape Velocity -
Geoffrey Moore,
Inspired - Marty Cagan
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46. Tomorrow at work:
- Question the assumptions!
- Manage all the risks
- Look deeper...
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47. Tell me how you went...
@carolineggordon
carolineggordon.com
caroline@carolineggordon.com
Thursday, 7 March 13