[Review] The Lean Startup
Courtesy of Sacha Chua4. As highlighted above, innovation accounting is a way of measuring progress through actionable metrics that help to tie in cause and effect. Unlike vanity metrics often found in standard accounting practices, innovation accounting leverages on an MVP to obtain real market data and uses these to propagate value adding improvements. 5. After learning what worked and what didn't, entrepreneurs need to either pivot or persevere. This moment of truth should be viewed objectively (think scientific experiments). Pivots can take the form of changes to singular product features, customer segments, platforms, business architecture, growth engines, technology and more. 6. Small batches inherently work better than large ones. Changes are more easily made to any step of the process and the costs of rework are far lower. 7. There are principally three engines of growth in any startup. The sticky engine of growth entails retaining customers through minimizing attrition while growing slowly, the viral engine comprises exponential growth through word-of-mouth means, while the paid engine looks at advertising and other costs (sales staff) to drive growth. 8. Finally, entrepreneurs should build adaptive organisations which have cultures valuing learning from mistakes while operating with discipline. By asking the five Whys, root causes of problems can be more easily ferreted out. However, one must be mindful not to let it degenerate into a blame game. In summary, "The Lean Startup" is an invaluable resource for anybody charged with starting a new business venture - be they entrepreneurs or intrapreneurs. By embracing the philosophy of thinking big and starting small coupled with a meticulous step-by-step analysis of what went right or wrong, startups can improve their chances of success. Productivity (a huge bugbear here in Singapore) can also be raised as process efficiency can be linked more directly to the market. This is imperative in today's inherently risky and uncertain business environment. For more information, do check out The Lean Startup website which has many useful links to learning resources.
Walter is a seasoned marketer and publicist with almost 19 years of experience in marketing, communications, social media engagement, events management, strategic planning and corporate development. A judge of the Singapore Blog Awards, he blogs at Cooler Insights.