Bridging the Gap

Corporations Want To Be Lean Startups Too

lsm corporate1 Corporations Want To Be Lean Startups Too

Mr. Owens in action.

This is a guest post by Trevor Owens, founder and CEO of  the Lean Startup Machine, a three-day workshop on Lean Startup methodologies. Mr. Owens has also been a guest speaker at Princeton, Columbia, Fordham, and New York University.

The implications of the Lean Startup movement have been significant for entrepreneurs all over the world. At long last, founders are spending less time building products in isolation, and more time embracing their customers. Validating assumptions early and methodically has allowed entrepreneurs to fail fast, turning startup failure into a scientific process that ultimately leads to success. This movement, however, may have even bigger implications in store for established companies. Corporations Want To Be Lean Startups Too Lean Startup isn’t about being cheap, but about being less wasteful and still doing things that are big.”

Can Corporations Be Startups Too?

Applying Lean Startup to corporations remains contentious. But of the 1,000+ LSM workshop attendees trained to date, a significant portion consistently includes corporate intrapreneurs. These are the people that drive innovation from inside the enterprise, whether through an explicit product development and R&D role, or through their personal influence within the organization regardless of their title.

Intrapreneurs are a precious commodity to companies that know how to turn innovation into profits. Keeping them from going out “on their own” does not simply imply better compensation, but requires a corporate culture of innovation, with the leadership setting the example. Given the right culture, intrapreneurs gladly share much of the returns (and risks) of their innovation work with their employer. With thousands more attendees to go through LSM internationally before this year ends, the message is clear: corporations want to try Lean Startup on for size.

Lean Startup Machine Goes Corporate

Two weeks ago, LSM hosted its first on-site corporate workshop in partnership with The Library Corporation (TLC), which provides software that runs more than 2,500 libraries around the world, including the public libraries of Los Angeles and Chicago, the National Library of Singapore, and school districts in Dallas, Atlanta, and Nashville.
TLC had sent several employees to the LSM weekend in New York. “Based on the feedback, we realized that this was something we wanted our whole product team eventually to experience,”  said Simon Marcus, TLC’s COO.

Mr. Marcus and his counterpart, CTO Jabe Bloom, spent the last five years optimizing the company’s software development and customer support operations. But beyond operations, they invested their energy heavily into creating a culture that rewards talent, initiative, and cooperation. They now see disruptive innovation as the 38-year-old company’s natural next step in its evolution.

TLC then reached out to LSM to ask for an on-site workshop for its 40-person product group.

So, How Did It Go?

To maximize the use of LSM team’s time, Mr. Marcus and Mr. Bloom conducted the initial idea pitches and team selection prior to the workshop.

The evening before the workshop, Lean Startup Machine’s four-person leadership team headed down to West Virginia with a quick stop in D.C. In keeping with the Lean Startup methodology, it was critical for the four of us to get first-hand experience with our first corporate customer. It was as much about ensuring top quality of what we delivered to them as it was about getting as much learning out of the experience as possible for ourselves to iterate on our own “corporate workshop” product.

This corporate on-site was planned to take place not entirely on TLC’s Inwood, WV, site. The LSM team rolled out of their beds at Inwood’s best Hampton Inn at 6 a.m., put on our signature yellow “GET OUT OF THE BUILDING” tees under otherwise business-casual blazers, and took a short drive through town to TLC’s wooded campus, where a charter bus was waiting.

The first day of the workshop started with a two-hour ride from TLC’s offices to Washington, DC, during which TLC employees immediately started working on their initial minimum viable product ideas. The LSM team wobbled up and down the middle isle, meeting and mentoring the TLC team throughout the bus ride.

The rest of the workshop was similar to the usual LSM’s experience. The difficulty of getting out of the building and talking to customers, the disappointment of learning that the idea you thought was great likely had no market potential, and the tension within teams as they had to align on their next pivot, were as exhausting and rewarding within corporate walls as they were at the public workshops.

Interestingly, the open organizational culture that TLC had created held the teams back when they ran into a highly structured and constrained mode of a startup. While the TLC team was certainly disciplined, being forced into almost impossible deadlines and an imposed learning curve was clearly somewhat of a shock. This highlighted the potential difficulties with creating a culture of innovation in corporate environments that are otherwise employee-driven.

What helped was the clear process and methodology that LSM delivered to TLC. Down to the type of sticky notes, using all caps and black markers, and staying strictly inside the lines (literally) on the Validated Learning Canvas, the learning process that had been validated in LSM’s public workshops got the corporate teams through the two days.

“No one would argue that the U.S. Marines don’t take extreme risk and innovate on the fly, but they do that within a highly rigorous, disciplined framework that protects them from obvious mistakes and supports them in complex evolving environments,” Mr. Bloom said.

Startups demand a high emotional cost from their co-founders, and corporations tend, rightfully, to focus on their employees’ well-being. Perhaps more than for the typical entrepreneur, the LSM experience was a true bootcamp for the corporate innovator.

LSM workshops are consistently populated by corporate executives, senior software developers, and project managers, who see learning Lean Startup as an investment into their own careers and their companies’ futures. To avoid the risks illustrated in The Innovator’s Dilemma, companies desire to diversify by investing in new product creation.

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