I just completed teaching a university winter semester course in Innovation and Entrepreneurship. All such courses in the last decade or so teach the lean startup canvas made popular by Steve Blank, Eric Reis and Ash Maurya. This distinctive tool for startup businesses is different than traditional business planning as it starts with a search for a business model. I believe this lean approach is the best way to go for BAM startups in high risk countries. I have found this grid helpful, which I have adapted from the May 2013 Harvard Business Review, page 69*.
| Lean Startup Approach | Traditional Business Planning |
| Strategy | |
| Business models; hypothesis-driven | Business Plan; implementation-driven |
| New-Product Process | |
| Customer development; Get out of the office and test hypothesis | Product Management; prepare offering for market following a linear, step-by-step plan |
| Engineering | |
| Agile development; build the product iteratively and incrementally | Build the product iteratively, or fully specify the product before building it |
| Organization | |
| Customer and agile development teams; hire for learning, nimbleness and speed | Departments by function; Hire for experience and ability to execute |
| Financial Reporting | |
| Metrics that matter; customer acquisition cost; lifetime customer value, viralness | Accounting; Income statement, balance sheet, cash flow statement |
| Failure | |
| Expected; Fix by iterating on ideas and pivoting away from ones that don’t work | Exception; Fix by firing executives |
| Speed | |
| Rapid; operates on “good enough” data | Measured; Operates on complete data |
| Missional Vision | |
| Documented ideas reviewed regularly; pivot toward what works | Detailed plan with upfront built in metrics |
- Blank, Steve. “Why the Lean Start-Up Changes Everything”. Harvard Business Review. May 2013: 65-72.
Larry Sharp, Director of Training, IBEC Ventures
larry.sharp@ibecventures.com