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Roadmap to the Lean Enterprise

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Video and slides synchronized, mp3 and slide download available at URL http://bit.ly/1ptuLYM.

Trevor Owens takes an in-depth look at the methodologies, tools, and incentive structures that are guiding some of the word's largest organizations to reclaim their innovation prowess. Filmed at qconnewyork.com.

Trevor Owens is an entrepreneur and thought leader on Lean Startup methodologies. He's the Founder & CEO of Javelin.com, an innovation training & software company known for the Lean Startup Machine workshop which has helped tens of thousands of people including those from Google, Salesforce, News Corp, Intuit, and others, start thousands of new businesses across six continents.

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Roadmap to the Lean Enterprise

  1. 1. THE LEAN ENTERPRISE Trevor Owens CEO, Javelin.com @TO
  2. 2. Watch the video with slide synchronization on InfoQ.com! http://www.infoq.com/presentations /roadmap-lean-enterprise InfoQ.com: News & Community Site • 750,000 unique visitors/month • Published in 4 languages (English, Chinese, Japanese and Brazilian Portuguese) • Post content from our QCon conferences • News 15-20 / week • Articles 3-4 / week • Presentations (videos) 12-15 / week • Interviews 2-3 / week • Books 1 / month
  3. 3. Presented at QCon New York www.qconnewyork.com Purpose of QCon - to empower software development by facilitating the spread of knowledge and innovation Strategy - practitioner-driven conference designed for YOU: influencers of change and innovation in your teams - speakers and topics driving the evolution and innovation - connecting and catalyzing the influencers and innovators Highlights - attended by more than 12,000 delegates since 2007 - held in 9 cities worldwide
  4. 4. Biz Stone Founder, Twitter
  5. 5. X-Google Employees
  6. 6. Process
  7. 7. Structure Process
  8. 8. Strategy Structure Process
  9. 9. Strategy Structure Process
  10. 10. $30M 100 PPL
  11. 11. 10 7.5 5 2.5 0 1 2 3 4 5 6 7 8 9 10
  12. 12. 10000 7500 5000 2500 0 1 2 3 4 5 6 7 8 9 10
  13. 13. Three Rules 1. Innovation is Unpredictable 2. Small Teams Win 3. One Success = Thousand Failures
  14. 14. Three Strategies 1. Prepare Don’t Plan 2. Fund Small Teams 3. Fund Many Projects
  15. 15. BIG IDEA Companies need to measure and scale Innovation Flow.
  16. 16. Strategy Structure Process
  17. 17. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness
  18. 18. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness Initial Enthusiasm
  19. 19. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness Initial Enthusiasm Reality Sets In
  20. 20. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness Initial Enthusiasm Reality Sets In TROUGH OF SORROW Experimenting & Pivoting
  21. 21. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness Initial Enthusiasm Reality Sets In TROUGH OF SORROW Experimenting & Pivoting Starts Working
  22. 22. The Startup Curve Before Startup Source: Paul Graham; avc.com Time Happiness Initial Enthusiasm Reality Sets In TROUGH OF SORROW Experimenting & Pivoting Starts Working Product/ Market Fit!
  23. 23. The Startup Curve Initial Enthusiasm Reality Sets In TROUGH OF SORROW Before Startup Scale Product/ Market Fit! Starts Working Experimenting & Pivoting Source: Paul Graham; avc.com Time Happiness
  24. 24. Employee 1. Security 2. Recognition
  25. 25. Entrepreneur 1. Power 2. Control Employee 1. Security 2. Recognition
  26. 26. Employee 1. Security 2. Recognition … Entrepreneur 1. Power 2. Control 12. Recognition 13. Security
  27. 27. “Ownership is why you stay up all night. It’s why you think about this all day, every day.” ! -Chris Dixon Andreessen Horowitz
  28. 28. “Stock options in a [large corporation] can never feel like ownership.” ! -Chris Dixon Andreessen Horowitz
  29. 29. Extrinsic Rewards Lead to Worse Performance
  30. 30. 1. Innovation Labs 2. Intrapreneur Programs 3. Skunkworks
  31. 31. 1. Innovation Lab 2. Intrapreneur Program 3. Skunkworks
  32. 32. Disney
  33. 33. INNOVATION COLONY Disney
  34. 34. Innovation Colony The best parts of an Innovation Lab and a Corporate Venture Fund.
  35. 35. Innovation Colony Employee projects are formed as separate legal entities
  36. 36. Benefit Enables employees to become entrepreneurs for benefit of the enterprise
  37. 37. Benefit Enables ownership and autonomy yet limits risk for the enterprise
  38. 38. Autonomy to Navigate Uncertainty
  39. 39. Autonomy to Navigate Uncertainty 1. Allocate Resources
  40. 40. Autonomy to Navigate Uncertainty 1. Allocate Resources 2. Change direction (pivot)
  41. 41. Autonomy to Navigate Uncertainty 1. Allocate Resources 2. Change direction (pivot) 3. Raise money from outside investors
  42. 42. Innovation Colony 1 Xerox Technology Ventures Circa 1988
  43. 43. Robert Adams
  44. 44. XTV Structure $30M, Corp Division Agreement Similar to LP $2M with No Approval Gave Researchers 20%
  45. 45. Results 7 Years Later 12 Years Later How do we know it worked?
  46. 46. Documentum (IPO, $75M rev) Document Sciences (IPO) Advanced Workstation Products (Acquired) vs. LiveWorks ($35M invested, failed) Customers and Technologies (no rev, failed) Xerox ColorGraphX (no rev, failed)
  47. 47. Innovation Colony 2
  48. 48. Techstars Structure 1,000 Applicants Internal & External Talent Mentoring Raise Outside Capital
  49. 49. Results
  50. 50. Results 75%
  51. 51. Strategy Structure Process
  52. 52. 180 DAYS
  53. 53. 1 DAY
  54. 54. Lean Startup
  55. 55. Start here. Brainstorm with stickies, pull it over to the right to start your experiment. Experiments Customer Problem 18 MONTHS Solution RESEARCH Riskiest Assumption Success Criterion Result & Decision Learning 1 2 3 4 5 Who is your customer? Time Limit: 5 Min What is the problem? Phrase it from your customer’s perspective. Time Limit: 5 Min +LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUNTime Limit: 5 Min List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min Need help? Use these sentences to help construct your experiment. To form a Customer/Problem Hypothesis: I believe my customer has a problem achieving this goal. To form your Assumptions: 0UVYKLYMVY̸hypothesis to be true, assumption needs to be true. Determine how you will test it: The least expensive way to test my assumption is... To form a Problem/Solution Hypothesis: I believe this solution will result in XHU[PÄHISLV[JVTL. To identify your Riskiest Assumption: The assumption with the least amount of data, and core to the viability of my hypothesis is... Determine what success looks like: I will run experiment with # of customers and expect a strong signal from # of customers. Project Name: Team Leader Name: GET OUT OF THE BUILDING! Follow Trevor @TO 1,000 CASE STUDIES
  56. 56. HYPOTHESIS C-P-S Follow Trevor @TO
  57. 57. “I BELIEVE customer HAS A PROBLEM WITH problem”
  58. 58. “I BELIEVE solution WILL RESULT IN outcome”
  59. 59. RISKIEST ASSUMPTION CORE + UNKNOWN
  60. 60. METHOD INTERVIEW - SELL- CONCIERGE
  61. 61. SUCCESS CRITERIA GOAL / SAFE PREDICTION
  62. 62. DECISION PIVOT - PERSEVERE
  63. 63. LEARNING MOST IMPORTANT LESSONS
  64. 64. Brainstorm here. When you’re ready, pull it over to the right to start your experiment. Experiments Start here. Brainstorm with stickies, Experiments Customer Problem VALIDATE THE PROBLEM Solution FIRST Riskiest Assumption Riskiest Assumption Success Criterion Success Criterion Result Decision Learning 1 2 3 4 5 Who is your customer? Who is your customer? Time Limit: 5 Min What is the problem? Phrase it from your customer’s perspective. What is the problem? Phrase it from your customer’s perspective. Time Limit: 5 Min +LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUN +LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUNTime Limit: 5 Min What are the assumptions that must hold true, for your hypothesis to be true? List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min Need help? Use these sentences to help construct your experiment. Need help? Use these sentences to help construct your experiment. To form a Customer/Problem Hypothesis: I believe my customer has a problem achieving this goal. To form your Assumptions: 0UVYKLYMVY̸hypothesis to be true, assumption needs to be true. Determine how you will test it: The least expensive way to test my assumption is... To form a Problem/Solution Hypothesis: I believe this solution will result in XHU[PÄHISLV[JVTL. To identify your Riskiest Assumption: The assumption with the least amount of data, and core to the viability of my hypothesis is... Determine what success looks like: I will run experiment with # of customers and expect a strong signal from # of customers. Project Name: Team Leader Name: GET OUT OF THE BUILDING! Start here. Brainstorm with stickies, pull it over to the right to start your experiment. Time Limit: 5 Min People buying Vespas on Craigslist People with KPMÄJS[ commute NYC Relying on products that use oil Understanding safety time saving of Vespa People with KPMÄJS[ commute NYC Vespa too expensive for identity risk Vespa One- Pager + Trial Rent Vespa Return It If Not Fit No friends Vespa Pay $250/month INTERVIEW: 8/10 don’t have friend with Vespa SELL: 15 email addresses in 2 hours Care about environment INTERVIEW: 5/20 buying Vespa bc environment important 0/20 PIVOT! 5/10 PIVOT! 50+ in 2 hours PERSEVERE! - Skinny Tie! - Buying for lifestyle - “I’m not a scooter person” - Lifestyle is a risk - People typing in ALL CAPS - Jumping out of seat to try Time Limit: 5 Min OZVS]PUNTime Limit: 5 Min List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min Customer Problem Solution Result Decision Learning 1 2 3 4 5 To form a Customer/Problem Hypothesis: I believe my customer has a problem achieving this goal. To form your Assumptions: 0UVYKLYMVY̸hypothesis to be true, assumption needs to be true. Determine how you will test it: The least expensive way to test my assumption is... To form a Problem/Solution Hypothesis: I believe this solution will result in XHU[PÄHISLV[JVTL. To identify your Riskiest Assumption: The assumption with the least amount of data, and core to the viability of my hypothesis is... Determine what success looks like: I will run experiment with # of customers and expect a strong signal from # of customers. Project Name: Team Leader Name: GET OUT OF THE BUILDING! STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE BRAINSTORM EXECUTE (QUICKLY)
  65. 65. Brainstorm here. When you’re ready, pull it over to the right to start your experiment. Experiments Start here. Brainstorm with stickies, Experiments Customer Problem Solution Riskiest Assumption Riskiest Assumption Success Criterion Success Criterion Result Decision Learning 1 2 3 4 5 Who is your customer? Who is your customer? Time Limit: 5 Min What is the problem? Phrase it from your customer’s perspective. What is the problem? Phrase it from your customer’s perspective. Time Limit: 5 Min +LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUN +LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUNTime Limit: 5 Min What are the assumptions that must hold true, for your hypothesis to be true? List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min Need help? Use these sentences to help construct your experiment. Need help? Use these sentences to help construct your experiment. To form a Customer/Problem Hypothesis: I believe my customer has a problem achieving this goal. To form your Assumptions: 0UVYKLYMVY̸hypothesis to be true, assumption needs to be true. Determine how you will test it: The least expensive way to test my assumption is... To form a Problem/Solution Hypothesis: I believe this solution will result in XHU[PÄHISLV[JVTL. To identify your Riskiest Assumption: The assumption with the least amount of data, and core to the viability of my hypothesis is... Determine what success looks like: I will run experiment with # of customers and expect a strong signal from # of customers. Project Name: Team Leader Name: STICKY NOTE STICKY NOTE STICKY NOTE GET OUT OF THE BUILDING! Start here. Brainstorm with stickies, pull it over to the right to start your experiment. Time Limit: 5 Min People buying Vespas on Craigslist People with KPMÄJS[ commute NYC Relying on products that use oil Understanding safety time saving of Vespa People with KPMÄJS[ commute NYC Vespa too expensive for identity risk Vespa One- Pager + Trial Rent Vespa Return It If Not Fit No friends Vespa Pay $250/month INTERVIEW: 8/10 don’t have friend with Vespa SELL: 15 email addresses in 2 hours Care about environment INTERVIEW: 5/20 buying Vespa bc environment important 0/20 PIVOT! 5/10 PIVOT! 50+ in 2 hours PERSEVERE! - Skinny Tie! - Buying for lifestyle - “I’m not a scooter person” - Lifestyle is a risk - People typing in ALL CAPS - Jumping out of seat to try Time Limit: 5 Min OZVS]PUNTime Limit: 5 Min List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min Customer Problem Solution Result Decision Learning 1 2 3 4 5 To form a Customer/Problem Hypothesis: I believe my customer has a problem achieving this goal. To form your Assumptions: 0UVYKLYMVY̸hypothesis to be true, assumption needs to be true. Determine how you will test it: The least expensive way to test my assumption is... To form a Problem/Solution Hypothesis: I believe this solution will result in XHU[PÄHISLV[JVTL. To identify your Riskiest Assumption: The assumption with the least amount of data, and core to the viability of my hypothesis is... Determine what success looks like: I will run experiment with # of customers and expect a strong signal from # of customers. Project Name: Team Leader Name: GET OUT OF THE BUILDING! STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE STICKY NOTE
  66. 66. experiment. Experiments Customer Problem Solution Riskiest Assumption Success Criterion Result Decision 1 2 3 4 5 Time Limit: 5 Min Time Limit: 5 Min OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... VESPA BUYERS CRAIGSLIST RELYING ON OIL CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 GET OUT OF THE BUILDING!
  67. 67. Solution Riskiest Assumption Success Criterion Result Decision Learning OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... like: with # of expect a strong customers. CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 GET OUT OF THE BUILDING! 0/20 INVALID ! PIVOT! SKINNY TIE ! BUYING LIFESTYLE
  68. 68. experiment. Experiments Customer Problem Solution Riskiest Assumption Success Criterion Result Decision 1 2 3 4 5 Time Limit: 5 Min Time Limit: 5 Min OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... VESPA BUYERS CRAIGSLIST RELYING ON OIL CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 GET OUT OF THE BUILDING! 0/20 INVALID ! PIVOT! DIFFICULT COMMUTE SEEING BENEFIT SAFETY ONE-PAGER + TRIAL NO VESPA FRIENDS INTERVIEW 8 / 10
  69. 69. Solution Riskiest Assumption Success Criterion Result Decision Learning OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... like: with # of expect a strong customers. GET OUT OF THE BUILDING! ONE-PAGER + TRIAL CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 0/20 INVALID ! PIVOT! SKINNY TIE ! BUYING LIFESTYLE NO VESPA FRIENDS INTERVIEW 8 / 10 5/10 INVALID ! PIVOT! “SCOOTER PERSON” LIFESTYLE RISK
  70. 70. experiment. Experiments Customer Problem Solution Riskiest Assumption Success Criterion Result Decision 1 2 3 4 5 Time Limit: 5 Min Time Limit: 5 Min OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... GET OUT OF THE BUILDING! 0/20 INVALID ! PIVOT! ONE-PAGER + TRIAL 5/10 INVALID ! PIVOT! VESPA BUYERS CRAIGSLIST RELYING ON OIL CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 DIFFICULT COMMUTE SEEING BENEFIT SAFETY NO VESPA FRIENDS INTERVIEW 8 / 10 DIFFICULT COMMUTE TOO EXPENSIVE IDENTITY RISK RENT VESPA BEFORE BUY PAY $250 / MONTH SELL 15 EMAILS 2 HOURS
  71. 71. Solution Riskiest Assumption Success Criterion Result Decision Learning OZVS]PUNTime Limit: 5 Min Time Limit: 10 Min Hypothesis: solution will result XHU[PÄHISLV[JVTL. Assumption: the least core to the hypothesis is... like: with # of expect a strong customers. CARE ABOUT ENVIRON-MENT INTERVIEW 5 / 20 GET OUT OF THE BUILDING! 0/20 INVALID ! PIVOT! SKINNY TIE ! BUYING LIFESTYLE NO VESPA FRIENDS INTERVIEW 8 / 10 5/10 INVALID ! PIVOT! “SCOOTER PERSON” LIFESTYLE RISK PAY $250 / MONTH SELL 15 EMAILS 2 HOURS 50 VALID ! PERSEVERE! ALL CAPS ! JUMPING SEAT
  72. 72. THE LEAN ENTERPRISE Trevor Owens CEO, Javelin.com @TO
  73. 73. Watch the video with slide synchronization on InfoQ.com! http://www.infoq.com/presentations/roadmap -lean-enterprise

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