The Innovator’s Method by Nathan Furr and Jeff Dyer. Harvard Business Review Press: Boston, MA (2015). 268 pages. US$30.00 (hard cover).
Lean methods are spreading well beyond the manufacturing floor. Debottlenecking business processes, like innovation, is an emerging trend along with design thinking and agile software development. Nathan Furr and Jeff Dyer apply the philosophy of lean development to start-ups in their new book, “The Innovator’s Method”.
Conventional wisdom dictates that a new entrepreneurial venture should start with writing a business plan. Of course, business plans project sales and revenues into the future. What follows is a rigorous process of constructing the new product or service and marketing it as designed in the business plan
In contrast, Furr and Dyer encourage doing away with the business plan (Introduction). Testing ideas and concepts with real consumers instead allows the entrepreneur to quickly test ideas in a real environment. Results of rapid experimentation guide the formulation of an advantaged product or service; one that better meets the needs of customers.
What is the innovator’s method? Customer insights are used to define a problem and solutions are tested to generate a scalable business model (pg. 11). The authors stress the advantages of the innovator’s method in an environment of increasing uncertainty (Chapter 1). Innovation can address uncertainties, especially with a lean approach to fail fast and learn from experimentation.
Chapters 3 through 6 delve into the details of each step in the innovator’s method: insight, problem, solution, and business model. Generating customer insights relies on manager and product development teams to get out of the office and observe. An example provided in the book indicates Hindustan Unilever has shown sales increases of 40% (pg. 70) as a result of product development based on customer insights. One customer asked why a health beverage contained sugar (pg. 69), leading to product improvements aligned with customer needs.
Chapter 4 focuses on understanding the problem from the customer’s point of view. These are described as “pain points.” In the lean methodology, then, prototypes are incomplete and used to test just one or two aspects of the product solution. In particular, the authors stress “faking” a solution (Chapter 5) just to see if the concept really addresses the customer need. (Faking may mean manually providing responses in a computer-automated system for testing purposes only.)
Chapter 6 describes key elements of a business model to include the customer consumption chain. This must involve awareness, evaluation, purchase, use, and consumption. Even so, the business model may need adjusting (Chapter 7, Master the Pivot).
Finally, scaling up is a serious challenge for entrepreneurs. Moving from success in ideation and testing to process quality improvement is not easy. Skill sets are different for executing product development and for efficient process improvement. Furr and Dyer recommend the V2MOM model (pg. 203) to guide scaling: vision, values, methods, obstacles, and measures.
“The Innovator’s Method” is a good book and flows easily from page to page. Each chapter includes engaging, real-life examples backed by academic references or interviews. While it is perhaps not earth-shattering, this book reminds every product developer and engineering manager to do their customer homework upfront. “The Innovator’s Method” is built on customer insights and clear problem definition. Testing potential customer solutions quickly is a hallmark of every successful innovation. Recommended for all product development professionals, “The Innovator’s Method” provides guidance for entrepreneurs and leaders tackling the marketability of new ideas.