Saturday, November 05, 2011

When Minimal Viable Product Doesn't Work (Part 2)

Today, Seth Godin had an interesting post on "When Minimum Viable Product Doesn't Work"- suggesting that the MVP approach suggested by Lean Start Up proponents has some limits.

I am in the midst of reading Lean Start Up by Eric Ries, and agree with Seth that it is a cool idea, but that it works best in some industries. I don't think Eric buys that, as he argues for very broad applicability of the lean start up approach. Since meeting Steve Blank a few years ago (dare I say he is the father of the lean start up movment?) I have been working on applying these concepts to social enterprises and BOP businesses.

So... is MVP a good idea for social entrepreneurs or BOPreneurs?

To me, the issue is one of "who bears the risk"?  Too often, well intentioned designers come up with a new product idea to help others, without a clear understanding of the context. In the well known example of the PlayPump, there was great excitement. However, the pumps, which had a habit of breaking down, often replaced more rudimentary (but longer lasting) hand pumps. In the end, some villages in Mozambique lost their source of drinking water. The company had put the risk of testing their product on the user, not the company.

I think MVP is still a good concept for BOPreneurs, as long as they pay close attention to "minimal" in their design. Don't make it so minimal that you have shifted risks of failure to your users or their communities. Too often, we fall in love with our ideas and only picture how much better off people will be with our new technology. But you must ask- "if this doesn't work, will our users be worse off than before?" Don't proceed until you can answer this question in the negative.

What happens if your solar powered light stops working? Does someone end up stepping on a cobra in the middle of the night? That is so much worse than a bad web link, isn't it? What happens if someone has spent a week's income on the light? Where do they exchange if for a new one (assuming they side stepped the cobra)? At Envirofit, we bought motorcycles from our early testers before doing retrofits. Did we distort the price signal a little? Probably, but if their bikes didn't work, the risk needed to be on us.

Unfortunately, you may also be working in a place that has had other well intentioned visitors trying things out on them. The cumulative impact of broken technologies should be understood; what can you do to minimize or eliminate the mistrust that results? And what about the reputation of any local partners that are helping you out? When you fly off, they still live there. What can you do to leave things better than you found them, not worse? I'd encourage you to look at Amy Smith's work on creative capacity building, which involves the community in the design of products and their dissemination. It is human nature to look at the benefits, but it is the entrepreneur's responsibility to look at the costs.

The insight behind MVP is validated learning, and using innovation accounting to measure what you learn. The motivation of the lean startup approach is to avoid "achieving failure," as Eric puts it, "successfully, faithfully and rigorously executing a plan that turned out to be utterly flawed." I believe the lean start up approach can be applied to social enterprises, as long as the venture has a deep understanding of, and undertaking to bear, the risks that the product is not viable.

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