Lean at HBS
Professor Tom Eisenmann has a new class at HBS, with some of the good stuff including reading lists and student comments online. This is how he defines his core thesis on pursuing a startup in a lean fashion:
“Most startups fail — usually due to lack of customer demand, not product development problems. These new ventures burn through their capital, wasting money on engineering and marketing before discovering they have built a product no one wants. Startups are more likely to succeed when they rapidly and iteratively test assumptions about a new venture’s business model based on customer feedback, then quickly refine promising concepts and ruthlessly cull the flops. New ventures that follow this approach are lean startups. “Lean” invokes the image of bootstrapping entrepreneurs, sustained by ramen noodles and a dream. Some lean startups fit that image. However, the term “lean” is derived from Toyota’s management philosophy. Toyota uses short production cycles to reduce inventory and eliminate waste. Lean startups similarly rely on short product development cycles to eliminate waste and gain rapid market feedback.
Lean startup practices are being pursued by firms in Silicon Valley and beyond. These practices have gained special traction in the information technology sector, where rapid “build/measure/learn” cycles are facilitated by the availability of open source engineering tools and Internet marketing channels”