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Lean Hardware

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Materials of the MERLIN (https://merlin-ict.eu) workshop 'Lean Hardware'. MERLIN will support market-oriented researchers, SMEs and startups across Europe, to consider the full potential of their research and to shape ideas and outputs into innovations to be ready for market validation and commercialisation, by using modern needs-first, market-led methodologies and offering free training workshops and meetup in 7 European countries.
More information in video https://bit.ly/merlin_video

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Lean Hardware

  1. 1. Workshop 7- Lean Hardware This project has received funding from the European Union’s Horizon2020 research and innovation programme under grantagreement No 780460 Trainers Location Date Helping today’s researchers create tomorrow’s enterprises
  2. 2. H2020 GA #780460 Rules for the workshop 2 No question is a silly question What is said in the room stays in the room Support and challenge each other
  3. 3. H2020 GA #780460 General information 3 o Workshop length – 4 hours o Coffee break – 20 minutes o Slide availability
  4. 4. H2020 GA #780460 Agenda 4 Intro – Lean Hardware methodology Waterfall vs lean when building hardware Risks and challenges in Lean Hardware Lifecycle for a hardware startup Lean Hardware startups and funding Playing a game Discussion Conclusion
  5. 5. H2020 GA #780460 Learning objectives 5 Understand the differences between Waterfall and Lean and/or Agile methods for building hardware Test the knowledge about how to build a hardware minimum viable prototype for manufacturing Discuss if Lean methodology is suitable for building hardware products in hardware startups: Risks and challenges
  6. 6. H2020 GA #780460 Target audience 6 ICT researchers and professors Makers Roboticists, electronic, computer science and automation systems engineers, among others
  7. 7. H2020 GA #780460 Intro – Lean Hardware methodology 7 o Lean main purpose: Reducing waste and delivering superior value to customers. When creating a startup: Using Lean Canvas instead of Business Model Canvas.
  8. 8. H2020 GA #780460 Intro – Lean Hardware methodology 8 Not only defining potential target customers is essential but also defining who the early adopters are. Lean Canvas Business Model Canvas
  9. 9. H2020 GA #780460 Intro – Lean Hardware methodology 9 If your startup is being born, you do not define key partners yet, but you need to identify the main problems (pains) that your potential customers have. Lean Canvas Business Model Canvas
  10. 10. H2020 GA #780460 Intro – Lean Hardware methodology 10 Define why you are different from other proposition. What value are you adding? Lean Canvas Business Model Canvas
  11. 11. H2020 GA #780460 Intro – Lean Hardware methodology 11 If your startup is being born, you do not define key activities yet, but you need to define the solution as pills for potential customers pains. Lean Canvas Business Model Canvas
  12. 12. H2020 GA #780460 Intro – Lean Hardware methodology 12 If your startup is being born, you do not define key resources yet, but you need to define the which key activities is necessary to measure: Use metrics for measuring such activities. Lean Canvas Business Model Canvas
  13. 13. H2020 GA #780460 Intro – Lean Hardware methodology 13 What feature in your productcould not currently easily copied or bought? Lean Canvas Business Model Canvas
  14. 14. H2020 GA #780460 Waterfall vs lean when building hardware 14 o Product development of any kind is plagued by numerous unknown unknowns. o Product concept, business needs, and market drivers may shift dramatically after development starts. o Agile methodology in software development has brought many advantages. o Minimum time to market. High value requests developed and delivered faster and higher probability of meeting customer needs.
  15. 15. H2020 GA #780460 Waterfall vs lean when building hardware 15 Comparison between Agile and Waterfall (traditional) methods Sprint concept in Agile methods Iterations, or short development cycles of uniform length (two to four weeks), on a just-in-time basis
  16. 16. H2020 GA #780460 16 AGILE PARADIGM IN SOFTWARE DEVELOPMENT o Many testable components: Agile processes encourage division of product scope into fine-grained pieces for developing and validating as fast as possible. o An Agile process is one that incorporates the principles of the Agile Manifesto. Individuals and interactions Working software Customer collaboration Responding to change Processes and tools Comprehensive documentation Contract negotiation Following a plan over Agile Traditional Waterfall vs lean when building hardware
  17. 17. H2020 GA #780460 17 Software development Hardware development Rewriting software is easy Risks and challenges in Lean Hardware
  18. 18. H2020 GA #780460 18 AGILE PARADIGM IN HARDWARE DEVELOPMENT Risks and challenges in Lean Hardware o Agile methods: Is it possible to apply them to hardware development? IN SOFTWARE IN HARDWARE Product owners are not developers First prototypes focused on users Two or three weeks sprints Change is cheap Product owners are developers Focused on what the product does instead of the user experience Test in the middle is difficult Strict process models meeting specific compliance standards Change is expensive Testing is easy
  19. 19. H2020 GA #780460 19 AGILE PARADIGM IN HARDWARE DEVELOPMENT Risks and challenges in Lean Hardware o Agile methods: It is possible to apply them to hardware development: o Adapting Agile paradigm for considering hardware special features. o Focusing on functionality instead of external design. o Modular design with connected standard independent components makes developing and testing easier. o Finding suitable early adopters is a key issue.
  20. 20. H2020 GA #780460 20 Risks and challenges in Lean Hardware o Lean Hardware methodology (Agile paradigm inspiration): ü Answer the question: What people expects. Put the users in the centre of the process. ü Fast iterations of LEARN->BUILD->MEASURE. Stage 1: Ask potential customers. Stage 2: Build a hardware minimum viable product (HMVP). Stage 3: Getting an alpha version. Stage 5: Improving the product. Stage 4: Getting a beta version. Stage 6: Final product.
  21. 21. H2020 GA #780460 21 Risks and challenges in Lean Hardware o Risks when applying Lean Hardware paradigm o When “asking potential customers”: More difficult to get early adopters because a hardware startup is proposing a physical device as idea. o When “building a hardware minimum viable product”: Difficulties to obtain a prototype for early adopters and test them. o When repeating the alpha-beta cycles: Minimize economic cost. o When improving the product and getting the final product: Bureaucratic aspects and regulation should be considered.
  22. 22. H2020 GA #780460 22 Lifecycle for a Hardware startup
  23. 23. H2020 GA #780460 23 Lean Hardware startups and funding o Costs for developing hardware is higher than for developing software. o Minimum viable prototype needs components that it is necessary to buy. o A provider is needed even in the very firsts steps of development. o A development kit is needed for integration of components and testing. o Software design is also often needed: Firmware. o Provisional external design is made by a third-party or by developers themselves: 3D printing technology is often needed.
  24. 24. H2020 GA #780460 24 Lean Hardware startups and funding o When to get funding and who could finance in each stage. Stage Main funding sources Concept Difficult. Investors needs to see something. Minimum Viable Product (MVP) Moderately difficult. Investors could see the product as the final version. Crowdfunding is risky (competitors could copy). Family and friends. Awards. Grants. Complete Functional Product (CFP) Easier. Investors could see a product that looks well. Angels investors. Family and friends. Crowdfunding. Grants. Awards. Design for Manufacture (DFM) Easier. Crowdfunding. Suitable if you have very early adopters. First Factory Run (FFR) Easier. Crowdfunding. Pre-orders. Angel investors. Accelerators. Venture capitalists. Retail Easier. Investors. Venture capital.
  25. 25. H2020 GA #780460 25 Solving doubts! A little rest for asking questions and solving doubts about theoretical aspects! 20 minutes
  26. 26. H2020 GA #780460 26 Playing a game For testing your knowledge!
  27. 27. H2020 GA #780460 27 Playing a game Telling the story… “You are a group of ICT researchers and makers that have some wonderful ideas in your mind about how to create an intelligent device for helping people to take care of pets…”
  28. 28. H2020 GA #780460 28 Playing a game Telling the story… “You have thought about a smart electronic pet feeder with multiple features for dogs’ owners” “Maybe the device could also include a water tank and a ball launcher for playing”
  29. 29. H2020 GA #780460 29 Playing a game Telling the story… A device that integrates several components used by owners…
  30. 30. H2020 GA #780460 30 Playing a game Telling the story… A device that integrates several components used by owners… …Remotely controlled
  31. 31. H2020 GA #780460 31 Playing a game Creating teams… 5 or 6 people as maximum
  32. 32. H2020 GA #780460 32 Playing a game Creating teams… Each team represents the group of makers that want to create a hardware startup for manufacturing the “wonderful pet feeder”.
  33. 33. H2020 GA #780460 33 Playing a game During the game… Each team will “make a story” or “track a path” from the idea to the manufactured product by taking decisions during the game, with the purpose of successfully ending the process.
  34. 34. H2020 GA #780460 34 Playing a game Materials o A moderator leads the game for teams to create their stories. o At the beginning, teams have a calendar, fake money and tools for annotation. o Teams get cards during the game that describe the story or path followed. o Teams also win points and funding, and spend money during the game, according to the decisions taken. o Luck also plays a role during the game.
  35. 35. H2020 GA #780460 35 Playing a game Cards X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: Z … X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: … V F X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: … a b c Three types:
  36. 36. H2020 GA #780460 36 Playing a game Cards X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: … c o Each card defines a stage in the game, that is, a part of the story (or the path), followedby each team. o The card always shows a number and the title and the description of the stage. Moreover, the team can annotate the spent money and time consumed until that moment. o The card optionally shows the tools that could be used during the stage and if it is possible to get funding in that moment.
  37. 37. H2020 GA #780460 37 Playing a game Cards X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: … c o Type c cards define the current stage and the moderator will ask each team to select a new card from a set of them that define the following stage. As teams select specific cards, a particular path towards the end of the process is built.
  38. 38. H2020 GA #780460 38 Playing a game Cards X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: … V F b o Type b cards also define the current stage. Every time a team gets this kind of card, the moderator should throw a pair of dices to decide which stage (represented by a card with number F or by a card with number V), will be the next for the team.
  39. 39. H2020 GA #780460 39 Playing a game Cards X TITLE OF THE STAGE Description of the stage. x y Team info Spent money: Time consumed: Z … a o Type a cards define the current stage but, in this case, the following stage (represented by a card with number Z), is already defined.
  40. 40. H2020 GA #780460 40 Playing a game Rules o The game starts when the moderator gives the first card to each team. Such card defines the stage 0, and it is the same for all the teams. o Moderator allows teams to get one card in each round. o During a round, teams should decide if tools are used (this consumes money and time), and if funding is got. Moderator will explain which tools and funding means are available. o When a team has a card of type c, the moderator will offer several possible cards and the team should select one of them. The spokesman of each team should explain the decision to the rest of participants.
  41. 41. H2020 GA #780460 41 Playing a game Rules o When a team has a card of type b, the moderator will throw a pair of dices and, according to the obtained result, a new card (defining the following stage), will be given to the team. o When a team has a card of type a, the following stage is already defined in the card. Therefore, the moderator will give the corresponding card to the team. o When all the teams have received a new card defining a new stage, another round starts and a punctuation is assigned by the moderator according the received card. o At the end of the game and according to the obtained punctuation the moderator will determine if the startup is or not successful.
  42. 42. H2020 GA #780460 42 Playing a game Now, let’s play!
  43. 43. H2020 GA #780460 43 Coffee break After playing, take a rest!
  44. 44. H2020 GA #780460 44 Discussion Now, it is time for discussion. All the participants are invited to actively participate!! Please, feel free to concisely express your opinion!!
  45. 45. H2020 GA #780460 45 Discussion o Time to describe your own hardware products…
  46. 46. H2020 GA #780460 46 Discussion o Time to describe your own hardware products… o Are you satisfied with the result of the game?
  47. 47. H2020 GA #780460 47 Discussion o Time to describe your own hardware products… o Have you applied or would you apply Lean Hardware for your product development? o Are you satisfied with the result of the game?
  48. 48. H2020 GA #780460 48 Discussion o Time to describe your own hardware products… o Have you applied or would you apply Lean Hardware for your product development? o What is your opinion about Lean Hardware methodology? o Are you satisfied with the result of the game?
  49. 49. H2020 GA #780460 49 Discussion o Do you think it is easy to apply Lean Hardware to the development of your product?
  50. 50. H2020 GA #780460 50 Discussion o Do you think it is easy to apply Lean Hardware to the development of your product? o What do you know about third-parties for factoring and manufacturing?
  51. 51. H2020 GA #780460 51 Discussion o Do you think it is easy to apply Lean Hardware to the development of your product? o What do you know about third-parties for factoring and manufacturing? o What’s about crowdfunding and avoiding to be copied?
  52. 52. H2020 GA #780460 52 Discussion o What do you know about bureaucracy and CE Marking?
  53. 53. H2020 GA #780460 53 Discussion o What do you know about bureaucracy and CE Marking? o What do you know about existing hardware startups, and their success or failure?
  54. 54. H2020 GA #780460 54 Discussion Some notes about CE Marking o Why is CE Marking important? Because it offers a sense of safety when your product is acquired. o Competitors with CE marked products could be a disadvantage for your company if you are not CE marked. o You can more easily overcome your competitors with not CE marked products if your products are CE marked. o The drawback: CE marking consumes time and money.
  55. 55. H2020 GA #780460 55 Discussion Some notes about CE Marking Stages that should be carried out for obtaining the CE Marking: ü Identify applicable directives. ü Check requirements according to European Regulation and standards. ü Identify if you need Notified organization. ü Test product and verify compliance. ü Establish technical documentation. ü Put CE marking issue by an EU Declaration of Conformity.
  56. 56. H2020 GA #780460 56 Discussion Example of successful hardware company o PrimeSense was a fabless semiconductor company and provided products in the area of sensory inputs for consumer and commercial markets. o Best known for licensing the hardware design and chip used in Microsoft's Kinect motion-sensing system for the Xbox 360 in 2010. o Selected by MIT Technology Review magazine as one of world's 50 most innovative companies for 2011. o On November 24, 2013, Apple Inc. confirmed the purchase of PrimeSense for $360 million.
  57. 57. H2020 GA #780460 57 Discussion Example of successful hardware company o Oculus VR is an American technology company specialized in virtual reality hardware and software products. o April 2012, Rift, a virtual reality headset designed for video gaming, is announced and launched a Kickstarter campaign in August to make virtual reality headsets available to developers. o March 2014, Facebook CEO Mark Zuckerberg agreed to acquire Oculus VR for US$2.3 billion in cash and stock. o Partnered with Samsung to develop the Samsung Gear VR in November 2015.
  58. 58. H2020 GA #780460 58 Discussion Example of successful hardware company o STAYmyway is a smartphone activated keyless access control system for residents, guests, visitors and rental hosts. It is possible to manage access rights for your doors remotely in the cloud. o Its novelty for innovation is that guests are able to access their rooms using only their smartphones. o It is not necessary to change the hotel locks, it is just needed to update them. In 5 minutes, a Bluetooth device is installed inside the lock. o Spanish startup from Cloud Incubator Hub.
  59. 59. H2020 GA #780460 59 Discussion Example of failed hardware company o Pebble is a discontinued smartwatch developed by Pebble Technology Corporation. o It was the most funded project in Kickstarter history. o On December 7, 2016, Pebble Technology filed for insolvency with Fitbit acquiring much of the company's assets and employees. o An unofficial developer group called Rebble was created to extend support for the Pebble watches' online services that were discontinued on June 30, 2018.
  60. 60. H2020 GA #780460 60 Discussion
  61. 61. H2020 GA #780460 61 Discussion Example of evolution of a hardware device.
  62. 62. H2020 GA #780460 62 Discussion Example of evolution of a young hardware startup.
  63. 63. H2020 GA #780460 63 List of resources o http://tech.eu/features/385/lean-hardware-startups-europe/ (The 50 most exciting lean hardware startups in Europe) o https://hax.co/lean-hardware/financing-lean-hardware/ o https://www.researchgate.net/profile/Laanti_Maarit/publication/308869388_Piloting_Lean- Agile_Hardware_Development/links/5a79d8e3aca2722e4df4e521/Piloting-Lean-Agile- Hardware-Development.pdf?origin=publication_detail (Paper: Piloting Lean-Agile Hardware Development) o https://dspace.mit.edu/bitstream/handle/1721.1/1661/95_01.pdf?sequence=1 REPORT -- LEAN 95-01 Toward Lean Hardware/Software System Development: Evaluation of Selected Complex Electronic System Development Methodologies. 1995.
  64. 64. H2020 GA #780460 64 List of resources o https://es.slideshare.net/haxco/building-leanhardwarestartups o http://www.berkeleysg.com/3-best-practices-for-lean-hardware-development/ o https://www.agilealliance.org/resources/sessions/experiences-from-lean-agile-hardware- development/ o https://www.quora.com/What-is-the-best-way-to-apply-Lean-Startup-principles-to- hardware-development
  65. 65. Workshop 7- Lean Hardware This project has received funding from the European Union’s Horizon2020 research and innovation programme under grantagreement No 780460 Trainers Location Date Helping today’s researchers create tomorrow’s enterprises

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