At IDEO, we’ve been doing a lot of work in the startup and corporate venturing space over the past few years. As we collaborate with startups and corporate entrepreneurs, through accelerator programs, our Startup in Residence program and as clients, we’ve been reflecting on how a design thinking process and the lean startup methodology compare and contrast with one another.
These two approaches are philosophically aligned, sharing three core beliefs:
- Customer focus: the notion of being user-centered lives at the heart of design, while the lean startup revolves around the goal of establishing product-market fit.
- Bias toward build: design relies heavily on building prototypes to elicit user reaction while lean startup trumpets the idea of a minimum viable product (MVP) to do the same.
- Embrace failure: design prescribes that we need to fail fast to succeed sooner, while lean startup channels activity toward a “persist, pivot or kill” decision point.
It’s clear that the two approaches play well together and are in fact closely related. However, they also have unique origins and differ materially in ways that are important to understand.
Design thinking is anchored around the idea of human empathy or “taking a walk in the user’s shoes.” For this reason, design’s roots lie heavily in the fields of anthropology, ethnography and human observation. The lean startup movement on the other hand has roots in scientific management, and its more recent incarnations like Kanban (popularized by Toyota) and agile development. It’s anchored around the idea of improving agility in an effort to reduce waste and making sure we’re applying human creativity and potential to the right tasks.
Both approaches are useful to those seeking to innovate and bring new offers and ventures to market. In fact, design thinking and the lean startup movement are more complementary than conflicting. A closer look reveals that they do a nice job of covering each other’s blind spots.
Complementary in nature
There’s a lot of emphasis placed on problem framing in design. This is done through deep engagement with and observation of users. Design thinking needs to be inspired by an observed human need to surface needs about retail banking. This means getting out of the building and doing things like accompanying a user on a banking errand. Moreover, the need can only be fully understood if users open up on a psychological and emotional level — it’s not good enough just to observe behavior. Going this deep is difficult. It requires research savvy and a significant time investment to build rapport with the user. This limits the scale of empathic research. We sacrifice breadth for depth, in order to understand elemental value drivers.
However, to justify launching a new offer or venture we can’t go off of observed needs alone. We need to be convinced that a larger market opportunity exists. This can’t necessarily be inferred from empathic research because of its lack of breadth and limited scale. This is where design thinking and the lean startup connect.
- What design thinking offers to a lean startup: Many lean startup practitioners have a tendency to treat everything as “pivotable.” This can be dangerous because it turns lean startup into a mechanistic trial and error exercise. The lack of intent makes it easy to get lost. To avoid this fate, it’s helpful to anchor lean techniques around an observed human need, which is supplied by design thinking. You never want to lose sight of the need you’re designing for as you undertake the lean startup.
- What the lean startup offers to design thinking: Lean startup methodology helps with discovery of the market opportunity that lives around the observed need. Lean startup’s emphasis on articulating hypotheses and testing them at scale, in the wild, often without users and stakeholders knowing they’re participating in a test, is helpful in this regard. Meanwhile, the rigorous measurement that accompanies lean startups plays a critical role in winning permission from investors and project sponsors to pursue the market opportunities we’re passionate about.
Case in point
One of our ongoing collaborations – with a mid-sized food company – highlights the complementary nature of these approaches. The company has strong equity around a specific food item and is keen to develop new businesses that can extend the item into new contexts. We kicked off our work by doing empathic research in Japan where this food item is consumed and applied in more creative ways than it is domestically. Using Japanese consumption behaviors as a baseline helped illuminate needs that are potentially going unmet here at home.
Once we honed in on a specific need by conducting empathic research with American users (guided by prototypes), we set out to understand the market opportunity. We accomplished this by setting up a pop-up kiosk at farmer’s markets, tollway oases and malls, where we stocked our new offerings alongside existing market offerings to validate consumer appeal. Our offerings performed well and validated that we had products that users are willing to pay a considerable amount for. However, we also learned that we have some work to do on things like formulation, assortment and retail strategy. We’ll iterate the offering, but in a way that doesn’t lose sight of the need we’re designing for.
As this example showcases, the marriage of design thinking and the lean startup methodology increases the chances that the new offers and ventures we design will succeed in-market. Why? We’re reducing risk by exposing our designs and parts of our venture to the market sooner. We’re developing more sustainable and resilient solutions by anchoring around meaningful needs. We’re reducing time to market by being scrappy, resourceful and consolidating research and development into one step. Leveraging the best of these two worlds has allowed us to engage more deeply with the startup ecosystem and pioneer emergent areas of design, like venture design.