Lean Startups

Why Getting Your Product to Market Fast Is Not Always a Brilliant Move

Why Getting Your Product to Market Fast Is Not Always a Brilliant Move
Image credit: Shutterstock
Reader Resource

Position yourself for growth in 2017—join us live at the Entrepreneur 360 Conference in Long Beach, Calif. on Nov. 16. Secure Your Seat »

Scrum and Lean Startup are right to say we should design products iteratively and faster. But they're wrong to suggest that we should deliver them faster.

Jeff Sutherland, the inventor of Scrum, the most popular software development framework in the world, spells it out quite clearly: "If you don't have a potentially shippable product at the end of each iteration, you're not doing Scrum." In Sutherland's opinion, any claim to "be Agile" and "follow Scrum" should be renamed to frAgile or Agile In Name Only, when you don't deliver (and potentially deploy) your product in increments, and thus deliver value to your customers faster.

Eric Ries, the creator of the Lean Startup movement, is of a similar opinion. Iterating in short cycles, failing fast, optimizing learning and pivoting until you've found a good match between your innovative ideas and the market's needs, have rapidly become key survival tactics for startups around the world. If you don't build, measure and learn in short cycles, you're not a proper lean startup.

I agree, but not completely.

I don't write and deliver my books one chapter at a time.
Pixar Animation does not deliver their films one scene at a time.
Apple does not deliver a new smartphone in weekly increments.
And the famous statue of David was not produced as individual body parts.

I can easily come up with reasons why products might be designed iteratively, but should not be delivered incrementally.

Related: 'The Lean Startup' Author Shares His Latest Advice

Not so fast, please.

One issue is that many types of products don't have a simplistic linear value function, where each feature added to a product translates to more value to the customer when delivered now. In fact, some products could destroy value if offered to a customer too soon. For example, many Hollywood films are released in the profitable summer months, or just before Christmas. Releasing them earlier or later would reduce expected income. Feedback cycles within the production process still matter a lot, but they cannot always involve real customers. I like paying for a finished product. If it's not finished, you pay me.

Another issue is that by offering products to customers too soon, even though the (few) features might be useful, you give them a wrong impression of your abilities and the product's qualities. You will prime your customers at a price point that is far too low. For example, there's a reason that houses are sold at higher price points when they are nicely decorated with curtains, carpets and furniture, and at lower price points when they are still unfinished. Customers have a hard time imagining living in a beautiful house when they're just looking at slabs of concrete as the floor and a clear sky as the ceiling. They will only agree on a price once. If you want me to imagine that your product is finished, I leave a higher price also to your imagination.

Last, but not least, introducing something into an environment is rarely without consequences. This is one of the key insights from complexity science. A new species introduced in an ecosystem will provoke a response from the other species that is hard to predict. Likewise, a new product on a free market can elicit a response from the other players. Seeking feedback from customers to validate your new product is great, but it's harmful when game theory says it might destroy your winning strategy. There's a reason Apple keeps a lot of information away from their future customers, and reveals a new product in one big show.

Related: 5 Ways the 'Lean' Approach Can Help Your Startup Grow

The good and the bad.

Both Scrum and Lean Startup have contributed tremendously to faster innovation in business. Most companies are risk averse, slow to change, and devoid of learning. Scrum and Lean Startup can certainly help people in such organizations adopt a more agile mindset. However, learning how to "deliver faster" is not your only priority as a successful business. It's best when you also spend some effort learning what is the optimal value function of your product over time, how to prime people's value perception at better price points, and how to launch your product strategically in the great game of global markets.

Does your Agile or Lean consultant take all those concerns into account?

Scrum and Lean Startup are right and wrong. They are right to suggest that you must learn (the earlier, the better) how customers will respond to your creative ideas. At the same time, they are wrong to push you to release your product at the wrong moment, at the wrong price, and at the wrong position in the game.

It's your job to use such methods where they make sense.

Related: Why the Motto 'If You Build It, They Will Come' is BS