LAJ ARTICLES

Lean Startup: slogan or strategy

With crowd funding and other emerging mechanisms for deal flow and retail distribution, there will be continued growth for both start ups and its industry of accessories.
I am a fan of ‘lean’ as a concept in business. The collected authors of Lean Startup have done a good job of re-purposing reinforced learning and diagramming efficient processes, functions and methods. Amongst Lean Startup’s attributes is that it strives to look at a total system with consideration of complexity and temporal dynamics.
Lean Startup, as defined by Eric Ries is: “a human institution designed to create a new product or service under conditions of extreme uncertainty”. I have read Eric’s breakdown of his definition and it seems showy and mystic. Not quite sure why the word human is included within the definition, but it is there and I suppose adds some measure of precision. It is human.
I do not find his definition, or its elaboration, nourishing, it doesn’t contemplate profit or value creation outcome. It’s a deliberate ommission, explained with diversionary babble. Without direction, all roads possess ‘extreme uncertainty’.
Lean Startup tries to extend itself, beyond a method and into a fable. It is what might come after “Just Do It”. It became its industry, part self help, part DIY, part support group, endlessly self referential and heavily marketed. Their narrative is that ‘they’ are their greatest testimonial.
Any type of ‘Startup’ is still very much art form, not yet science. We do not yet have a mathematical framework for modeling decisions. There is no algorithm that can simulate and make a computational probability of ‘best’, assign values to choices and an equity to likely outcomes (as it affects shareholder return) going plies deep.Nor can we conceivably give a loss of ‘time’ equity value to an improper iteration, or subsequent series of corrective iterations. We don’t have a ‘business state’ pattern recognition or a perfect way of observing and managing volatility. Nor do we have perfect information because it is impossible to know what competitors are plotting.
Thankfully, we have some exceptional VC’s and entrepreneurs who possess exceptional logic, and that is their premium. For those VC’s that are willing and the stakes high enough, the company becomes their baby. Startups require constant supervision. They always have to be regulated for the proper management of resources and data is imperative but interpretative.
At its core, Lean Start up believes that it is a faster, more exhaustive methodology that conserves time and resources. I disagree.
Absent very experienced management and stakeholders with deep comprehension and insight, a company applying a discipline of Lean Startup can become a series of vanity projects threaded together with jargon and without reliable vision. It will go with the wind and never find land.
When crisis occurs, Lean Startup is tempted to propel a company out of that state where a visionary might want to linger a bit longer. Expensive, yes it is.
That is the quality of a great leader, sometimes data is not complete and vision can’t be properly reconciled. Lean Startup assembly pushes the company to trauma. It is ‘pivot’ friendly, and that can be its greatest problem.

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