Minimum viable product

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A minimum viable product (MVP) is a version of a product with just enough features to be usable by early customers who can then provide feedback for future product development. [1] [2]

Contents

A focus on releasing an MVP means that developers potentially avoid lengthy and (possibly) unnecessary work. Instead, they iterate on working versions and respond to feedback, challenging and validating assumptions about a product's requirements. [3] The term was coined and defined in 2001 by Frank Robinson [4] and then popularized by Steve Blank and Eric Ries. [5] [6] [7] [8] It may also involve carrying out market analysis beforehand. The MVP is analogous to experimentation in the scientific method applied in the context of validating business hypotheses. It is utilized so that prospective entrepreneurs would know whether a given business idea would actually be viable and profitable by testing the assumptions behind a product or business idea. [9] The concept can be used to validate a market need for a product [9] and for incremental developments of an existing product. [10] As it tests a potential business model to customers to see how the market would react, it is especially useful for new/startup companies who are more concerned with finding out where potential business opportunities exist rather than executing a prefabricated, isolated business model.

Description

A diagram that illustrates how one can start develop and launch a minimum viable product by implementing at first the most simple product with the most essential functionality that makes the early product to be already usable. From minimum viable product to more complex product.png
A diagram that illustrates how one can start develop and launch a minimum viable product by implementing at first the most simple product with the most essential functionality that makes the early product to be already usable.

A minimum viable product has just enough core features to effectively deploy the product, and no more. Developers typically deploy the product to a subset of possible customers, such as early adopters who are thought to be more forgiving, more likely to give feedback, and able to grasp a product vision from an early prototype or marketing information. This strategy aims to avoid building products that customers do not want and seeks to maximize information about the customer with the least money spent. The technique falls under the Lean Startup methodology as MVPs aim to test business hypotheses and validated learning is one of the five principles of the Lean Startup method. [11] It contrasts strongly with the traditional "stealth mode" method of product development where businesses make detailed business plans spanning a considerable time horizon. Steve Blank posited that the main principle of the Lean Startup approach rests in the validation of the hypotheses underlying the product by asking customers if they want the product or if the product meets their needs, and pivoting to another approach if the hypothesis turns out to be false. [12] This approach to validating business ideas cheaply before substantial investment saves costs and limits risk as businesses that upon experimentation turn out to be commercially unfeasible can easily be terminated. It is especially important as the main cause of startup failure is the lack of market need; [13] that is, many startups fail because their product isn't needed by many people, and so they cannot generate enough revenue to recoup the initial investment. Thus it can be said that utilizing an MVP would illuminate a prospective entrepreneur on the market demand for their products.

For example, in 2015, specialists from the University of Sydney devised the Rippa robot to automate farm and weed management. [14] Before it was released, the technical hypothesis – that the robot can distinguish weeds from farm plants – had already been proven. But the business hypothesis – that it would be a viable tool on a working farm – still needed to be proved. [15] The application of the MVP method here is that the business hypothesis is tested, and only if it proves successful will further development be invested.

"The minimum viable product is that version of a new product a team uses to collect the maximum amount of validated learning about customers with the least effort." [2] The definition's use of the words maximum and minimum means it is not formulaic. It requires judgment to figure out, for any given context, what MVP makes sense. Due to this vagueness, the term MVP is commonly used, either deliberately or unwittingly, to refer to a much broader notion ranging from a rather prototype-like product to a fully-fledged and marketable product. [16]

An MVP can be part of a strategy and process directed toward making and selling a product to customers. [17] It is a core artifact in an iterative process of idea generation, prototyping, presentation, data collection, analysis and learning. One seeks to minimize the total time spent on an iteration. The process is iterated until a desirable product/market fit is obtained, or until the product is deemed non-viable.

Steve Blank typically refers to minimum viable product as minimum feature set. [18] [19]

Purposes

Testing

Notable quotes

Marketing

Releasing and assessing the impact of a minimum viable product is a market testing strategy that is used to screen product ideas soon after their generation. In software development, the release is facilitated by rapid application development tools and languages common to web application development.

The MVP differs from the conventional market testing strategy of investing time and money early to implement a product before testing it in the market. It is intended to ensure that the market wants the product before large time and monetary investments are made. The MVP differs from the open-source software methodology of release early, release often that listens to users, letting them define the features and future of the product. Instead, the MVP starts with a product vision, which is maintained throughout the product life cycle, although it is adapted based on the explicit and implicit (indirect measures) feedback from potential future customers of the product. [2]

The MVP is a strategy that may be used as a part of Blank's customer development [ broken anchor ] methodology that focuses on continual product iteration and refinement based on customer feedback. Additionally, the presentation of non-existing products and features may be refined using web-based statistical hypothesis testing, such as A/B testing.

Business Model Canvas

The Business Model Canvas is used to map in the major components and activities for a company starting out. The minimum viable product can be designed by using selected components of the Business Model Canvas:

Customers
Customers on the Business Model Canvas denote to whom a value proposition is considered for. [23] Utilizing the minimum viable concept here would be useful to determine whether the selected customer segment actually wants that product, either from questionnaires or experimental launches. Whichever method is chosen, the key in using the MVP is to spend as little as possible while learning as much as possible, thus in this case validating the market with the least possible cost.
Value proposition
The value proposition details what does a business offer to its customers – what desires it satisfies or what problems it solves. [23] In this case, usage of the MVP would focus more on the technical feasibilities of the product (whether such value is possible to deliver using the product), as in the Rippa case described earlier.
Channels
In the business model canvas lingo, channels refer to the ways by which a business delivers value to its customers. [23] MVPs would thus be used here to test whether a newly proposed method of value delivery (for example new channels of distribution, innovations in supply chains) works.
Relationship
As its name implies, relationships refer to how a business attracts and maintains its customers by providing them with the treatment and care they expect. [23] MVPs here would be used to learn if customers would better appreciate a new method of relationship building, and true to the MVP concept the test would seek to learn as much as possible whilst sacrificing the least amount of brand equity, reputation, or costs possible.

Emerging applications

Concepts from minimum viable products are applied in other aspects of startups and organizations.

Minimum viable brand (MVB)

Using a minimum viable brand (MVB) concept can ensure brand hypotheses are grounded in strategic intent and market insights. [24]

Minimum viable co-founder

Finding other people to create a minimum viable product is a common challenge for new companies and startups. The concept of minimum viable co-founder is based on looking for a co-founder with the following attributes: [25]

Criticism

Some research has shown that early release of an MVP may hurt a company more than help when companies risk imitation by a competitor and have not established other barriers to imitation. [26] It has also indicated that negative feedback on an MVP can negatively affect a company's reputation. [26] Many developers of mobile and digital products are now criticizing the MVP because customers can easily switch between competing products through platforms (e.g. app stores). [27] Also, products that do not offer the expected minimum standard of quality are inferior to competitors that enter the market with a higher standard.

A notable limitation of the MVP is rooted in its approach that seeks out to test its ideas to the market. Since the business's new product ideas can be inferred from their testing, the method may be unsuited to environments where the protection of the intellectual property is limited (and where products are easily imitated). [28]

The criticism of the MVP approach has led to several new approaches, e.g. the Minimum Viable Experiment MVE, [29] the Minimum Awesome Product MAP, [30] or the Simple, Lovable, Complete. [31]

See also

Related Research Articles

A startup or start-up is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable business model. While entrepreneurship includes all new businesses including self-employment and businesses that do not intend to go public, startups are new businesses that intend to grow large beyond the solo-founder. During the beginning, startups face high uncertainty and have high rates of failure, but a minority of them do go on to become successful and influential, such as unicorns.

New product development (NPD) or product development in business and engineering covers the complete process of launching a new product to the market. Product development also includes the renewal of an existing product and introducing a product into a new market. A central aspect of NPD is product design. New product development is the realization of a market opportunity by making a product available for purchase. The products developed by an commercial organisation provide the means to generate income.

<span class="mw-page-title-main">Proof of concept</span> Realization of a certain method or idea in order to demonstrate its feasibility

Proof of concept, also known as proof of principle, is a realization of a certain idea, method or principle in order to demonstrate its feasibility, or viability, or a demonstration in principle with the aim of verifying that some concept or theory has practical potential. A proof of concept is usually small and may or may not be complete.

Agile manufacturing is an emerging strategic approach that focuses on a few key principles. These include flexibility, rapid response, collaboration and continuous improvement. Agile manufacturing is a term applied to an organization that has created the processes, tools, and training to enable it to respond quickly to customer needs and market changes while still controlling costs and quality. It is mostly related to lean manufacturing.

<span class="mw-page-title-main">Steve Blank</span> American businessman

Steve Blank is an American entrepreneur, educator, author and speaker. He created the customer development method that launched the lean startup movement. His work has influenced modern entrepreneurship through the creation of tools and processes for new ventures which differ from those used in large companies.

<span class="mw-page-title-main">Continual improvement process</span> Ongoing effort to improve products, services, or processes

A continual improvement process, also often called a continuous improvement process, is an ongoing effort to improve products, services, or processes. These efforts can seek "incremental" improvement over time or "breakthrough" improvement all at once. Delivery processes are constantly evaluated and improved in the light of their efficiency, effectiveness and flexibility.

<span class="mw-page-title-main">Hypothesis</span> Proposed explanation for an observation, phenomenon, or scientific problem

A hypothesis is a proposed explanation for a phenomenon. For a hypothesis to be a scientific hypothesis, the scientific method requires that one can test it. Scientists generally base scientific hypotheses on previous observations that cannot satisfactorily be explained with the available scientific theories. Even though the words "hypothesis" and "theory" are often used interchangeably, a scientific hypothesis is not the same as a scientific theory. A working hypothesis is a provisionally accepted hypothesis proposed for further research in a process beginning with an educated guess or thought.

Lean startup is a methodology for developing businesses and products that aims to shorten product development cycles and rapidly discover if a proposed business model is viable; this is achieved by adopting a combination of business-hypothesis-driven experimentation, iterative product releases, and validated learning. Lean startup emphasizes customer feedback over intuition and flexibility over planning. This methodology enables recovery from failures more often than traditional ways of product development.

Lean enterprise is a practice focused on value creation for the end customer with minimal waste and processes. Principals derive from lean manufacturing and Six Sigma. The lean principles were popularized by Toyota in the automobile manufacturing industry, and subsequently the electronics and internet software industries.

Partner development is a customer-centric approach to business development. It draws from the customer development framework popularized by Steve Blank.

<span class="mw-page-title-main">Eric Ries</span> American entrepreneur

Eric Ries is an American entrepreneur, blogger, and author of The Lean Startup, a book on the lean startup movement. He is also the author of The Startup Way, a book on modern entrepreneurial management.

<i>The Lean Startup</i> Book by Eric Ries

The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses is a book by Eric Ries describing his proposed lean startup strategy for startup companies.

Product marketing is a sub-field of marketing that is responsible for crafting the messaging, go-to-market flow, and promotion of a product. Product marketing managers can also be involved in defining and sizing target markets. They collaborate with other stakeholders including business development, sales, and technical functions such as product management and engineering. Other critical responsibilities include positioning and sales enablement.

Front End Innovation is the starting point where opportunities are identified and concepts are developed prior to entering the formal product development process. Innovation on the Front End is where exciting breakthroughs are created through a process that allows for creativity and value creation in a systematic manner different from the formal development process.

Product-market fit, also known as product/market fit, is the degree to which a product satisfies a strong market demand.

Pretail is a sub-category of e-commerce and online retail for introducing new products, services, and brands to market by pre-launching online, from creating an interest waitlist of signups before launch to collecting reservations or pre-orders in limited quantity before release, realization, or commercial availability. Pretail allows new product ideas/prototypes to be mass produced only when they have reached an initial threshold of buy-in from investors/consumers. Pretail includes pre-sale commerce, pre-order retailers, pre-launch marketing services, incubation marketplaces, crowdfunding communities, and demand chain management systems.

Lean LaunchPad is an entrepreneurship methodology created by Steve Blank to test and develop business models based on querying and learning from customers. It is said to be based on the scientific method and combines experiential learning with “The three building blocks of a successful lean startup”: Alexander Osterwalder's "Business Model Canvas", Steve Blank's "Customer Development Model", and Agile Engineering.

Customer development is a formal methodology for building startups and new corporate ventures. It is one of the three parts that make up a lean startup.

<span class="mw-page-title-main">Second product syndrome</span> Business concept

Second product syndrome is a business concept introduced by Steve Jobs in the documentary The Pixar Story. Steve Jobs describes the concept as when the company comes up with a very successful first product, it becomes more ambitious and boastful. The company then decides to go ahead with the second product without actually investigating and understanding the reason behind their first product's success. Therefore, the second product often ends up as a failure.

The Market Opportunity Navigator(MON) is a methodology in strategic management that aims to help innovators and entrepreneurs identify and select the most valuable market opportunity to pursue current and future resources and capabilities. It was added as the fourth tool in the lean startup toolset and can be used with the Business Model Canvas developed by Alexander Osterwalder and Yves Pigneur and the Minimum Viable Product.

References

  1. ↑ "What is a Minimum Viable Product (MVP)? – Definition from Techopedia".
  2. 1 2 3 Ries, Eric (August 3, 2009). "Minimum Viable Product: a guide".
  3. ↑ Vartan, Arbi; Brinkerhoff, Jeff. "MVP: A maximally misunderstood idea". Slalom. Archived from the original on 2019-03-28. Retrieved 2019-12-04.
  4. ↑ "SyncDev methodology". SyncDev. Archived from the original on May 25, 2016. Retrieved May 16, 2016.
  5. ↑ W. S. Junk, "The Dynamic Balance Between Cost, Schedule, Features, and Quality in Software Development Projects", Computer Science Dept., University of Idaho, SEPM-001, April 2000.
  6. ↑ Eric Ries, March 23, 2009, Venture Hacks interview: "What is the minimum viable product?", Lessons Learned
  7. ↑ "Steve Blank Perfection By Subtraction – The Minimum Feature Set". Steve Blank. March 4, 2010.
  8. ↑ Holiday, Ryan The single worst marketing decision you can make The Next Web. 1 April 2015
  9. 1 2 "A Minimum Viable Product Is Not a Product, It's a Process: Building Product, Experimentation, MVP". YC Startup Library. Retrieved 2020-10-17.
  10. ↑ "The Scientific Method for Startups: Building Product, Experimentation, KPI". YC Startup Library. Retrieved 2020-10-17.
  11. ↑ "Eric Ries on 'The Lean Startup'". Knowledge @ Wharton.
  12. ↑ Blank, Steve (2013-05-01). "Why the Lean Start-Up Changes Everything". Harvard Business Review. No. May 2013. ISSN   0017-8012 . Retrieved 2020-10-17.
  13. ↑ "Why Startups Fail: Top 20 Reasons l CB Insights". CB Insights Research. 2019-11-06. Retrieved 2020-10-19.
  14. ↑ "Rippa robot takes farms forward to the future". The University of Sydney. Retrieved 2020-10-19.
  15. ↑ admin (2018-07-26). "RIPPA The Farm Robot Exterminates Pests And Weeds". agronomybots. Archived from the original on 2020-10-19. Retrieved 2020-10-19.
  16. ↑ Ambler, Scott (2017-12-27). "Defining MVP, MMF, MMP, and MMR". The Disciplined Agile (DA) Blog. Retrieved 19 June 2021.
  17. ↑ Radoff, Jon (May 4, 2010). "Minimum Viable Product rant". Jon Radoff's Internet Wonderland. Archived from the original on March 23, 2014. Retrieved 19 August 2014.{{cite web}}: CS1 maint: unfit URL (link)
  18. 1 2 Blank, Steve (March 4, 2010). "Perfection By Subtraction – The Minimum Feature Set".
  19. ↑ Lenarduzzi, Valentina; Taibi, Davide (August 2016). MVP Explained: A Systematic Mapping Study on the Definitions of Minimal Viable Product. 2016 42nd Euromicro Conference on Software Engineering and Advanced Applications (SEAA). Cyprus. pp. 112–119. doi:10.1109/SEAA.2016.56. dsd-seaa2016.cs.ucy.ac.cy
  20. ↑ Putten, Alexander B. van; MacMillan, Ian (2004-12-01). "Making Real Options Really Work". Harvard Business Review. No. December 2004. ISSN   0017-8012 . Retrieved 2020-10-31.
  21. ↑ McGrath, Rita Gunther; MacMillan, Ian (1995-07-01). "Discovery-Driven Planning". Harvard Business Review. No. July–August 1995. ISSN   0017-8012 . Retrieved 2020-10-31.
  22. ↑ Gallo, Amy (2017-02-13). "A Refresher on Discovery-Driven Planning". Harvard Business Review. ISSN   0017-8012 . Retrieved 2020-10-31.
  23. 1 2 3 4 Osterwalder, Alexander; Pigneur, Yves (2010). Business model generation: a handbook for visionaries, game-changers, and challengers. ). Hoboken, New Jersey. ISBN   978-0470876411. OCLC   648031756.{{cite book}}: CS1 maint: location missing publisher (link)
  24. ↑ "Start-Ups Need a Minimum Viable Brand". Harvard Business Review. Retrieved 2017-09-20.
  25. ↑ Shah, Darmesh (October 5, 2011). "Choosing A Minimally Viable Co-Founder".
  26. 1 2 "The Limitations of Lean Startup Principles". knowledge.wharton.upenn.edu. Knowledge@Wharton, Wharton School of the University of Pennsylvania. 28 September 2018. Retrieved 17 October 2018.
  27. ↑ Beneyto, Carlos (February 5, 2018). "The MVP is dead, long life to the MAP. (Minimum Awesome Product)".
  28. ↑ Contigiani, Andrea. "The Downside of Applying Lean Startup Principles". Knowledge @ Wharton.
  29. ↑ "Death to the Minimum Viable Product! | Lean User Testing". January 11, 2019. Archived from the original on September 29, 2018. Retrieved January 22, 2019.
  30. ↑ fluidmobile GmbH (January 22, 2019). "Minimum Awesome Product in der App-Entwicklung". Archived from the original on January 9, 2019. Retrieved January 22, 2019.
  31. ↑ Cohen, Jason (22 Aug 2017). "I hate MVPs. So do your customers. Make it SLC instead".
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