Companies usually create the perfect business plan to launch new products and services which are then introduced into the market. They often fail to incorporate the voice of the customer into the early design phases, which can lead to catastrophic failures later.
The concept of lean startups places importance on delivering the greatest possible customer value without engaging in elaborate planning. While several businesses face challenges and fail, lean startups are more resilient and more flexible, as they’re not restricted by a rigid business plan.
Businesses of any scale can embrace lean startup principles to create products that are actually needed by customers, as the latter will be willing to pay a price for something they really need. This also helps establish brand loyalty in the long term which contributes to greater customer lifetime value.
What is Lean Methodology?
Lean is a process improvement methodology that aims to fix waste in production to improve efficiency, productivity, and customer satisfaction. Waste is anything that doesn’t contribute any value to customers and includes delays, waiting times, switching times, defects, production issues, etc
Lean traces its roots to the 1960s when it originated in the manufacturing sector. The approach puts all emphasis on processes and focuses on continuous improvement. It is highly customer-centric.
When wastes are removed from processes, what remains are value-adding processes. Lean minimizes inventory management costs with a pull system, where goods are only created when there’s a demand for them. This helps manage overproduction.
How Startups Can Become Lean?
Startups that aim to embrace lean should focus on continuous improvement. It is crucial to create ways to obtain continuous feedback from your customers and use it to shape your goods and services in a way that adds more value to customers.
It’s a great idea to involve customers in product design cycles so that the final product already has an established demand in the market. Constant product improvement helps startups differentiate themselves from their competitors as well while enjoying greater business efficiency at reduced costs.
Since customer needs are incorporated into the product at early stages, products are much more likely to succeed.
The Era of Lean Startups
Lean startup is actually an innovative methodology that emphasizes experimentation to create minimum viable products. Lean startups use the lean methodology to create rapid product delivery cycles for customers. This helps reduce market risks and immediately cuts down on overproduction and inventory management losses.
Companies should strive to cut down on waste, which are process inefficiencies that don’t address customer pain points.
Since customers are involved from the beginning itself, lean startups will address customer requirements in a better way and face fewer losses.
Brands that attempt to launch new products and services should use the lean startup approach to increase their chances of success.
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