6 Lean Startup “benefits” to gain “advantage” over your Competition

Lean Startup is a new way of looking at the development of innovative new products that emphasizes fast iteration, customer feedback, a huge vision, & great ambition – all at the same time.

Topics: Responsive & Flexible, faster Innovation, Smaller Opportunities. Focus on a Target Niche Market. “closer” to your Customers, Low to Zero for Sales & Marketing Costs.

Below are six natural advantages Lean entrepreneurs have over large or entrenched Competition that, when multiplied – along with a true sense of urgency, can help you achieve strong growth.

1. You’re more Responsive & Flexible. Nimbleness & agility aren’t exactly two things big companies are known for. Typically, the larger an organization gets, the more dependent it becomes on established structures & processes. There’s more “bureaucracy” you deal with, the “lines of communication” become less & less direct. Worst of all, there are more of the biggest productivity-killers of all — Meetings. As a result, planning horizons tend to be in years rather than days, weeks, or months. By contrast, with Lean you can pivot and react to market opportunities in the time it takes them to organize a Conference call.

How to Fully Exploit this Advantage:

Pick a product market that is rapidly growing or has dynamic needs
Pick a product market that has significant long-term innovation potential
Build your market before large companies know what hit them (stealth
Use new and innovative technologies to grow your company
Make sure the Developers & senior Management is getting out in the field – to see what’s happening

2. You Can Innovate Much More Quickly & Effectively. Change is something any large organization with established systems & processes inherently struggles with. The same goes for the biggies embracing risk. Not only can it be extremely difficult to coordinate changes & new initiatives simply from a logistical point of view, there can also often be significant resistance to it from employees & management alike.

For BiG Co Incumbents, creative thinking & problem solving is often confined to making small tweaks & iterations to existing processes & sytems. In other words, they get stuck in a “that’s the way we’ve always done it” mindset.

As a Lean Startup, you don’t have to be restrained by those types of limitations. In fact, the more innovative & “disruptive” you can make your business/ solution, the harder it will be for bigger companies to copy, catch up, or compete with what you’re doing.

How to Fully Exploit this Advantage:

Be bold and take risks with new technology. You only have be right once.
Build new technology that competitors would have difficulty building into their current platform
Execute an approach that would be very disruptive for a larger company to replicate
Encourage & empower individual teams and employees to test, iterate, and adopt innovative approaches

3. You can Go for Smaller Opportunities. Large companies need to go after large market opportunities. They often can’t justify going after what they see as small markets (particularly if those markets have special needs). That leaves a significant number of opportunities slipping through the cracks – that you can take advantage of.

Use your Laser Focus to ID & Attack. The key for startup entrepreneurs is to identify & attack markets/ democratics (no, demographics) that may be small now, but are on an upward trajectory and have potential for growth. While this might seem to paint you into a smaller corner to begin with, the upside is that you should be able to establish yourself & grow relatively undisturbed by biggies – after which you can look to expand.

How to Fully Exploit this Advantage:

Look for markets that are too small for large companies, or simply off their radar
Look for customer “segments” with special needs that aren’t being fully addressed by big companies
Pinpoint a small or latent market that other startups are only beginning to attack

4. You can Develop an In-Tents, no Intense Focus on a Target Niche Market. Large companies have a difficult time with focus. They generally have to increase their scope to sustain their growth, developing products aimed at numerous customer segments using many distribution approaches. Even though they have more resources, they have to spread those resources thin across a variety of product markets.

Lean Focus. In contrast, you can devote your resources to developing a Lean laser-focus on one very specific target segment. That gives you a powerful advantage. Not only can you develop a comprehensive and in-depth understanding of your customers — their pain points, wants, needs, & buying habits (not to mention how actually they use and realize value from your product) — you can also get incredibly clear & concise (focused) with your messaging.

How to Fully Exploit this Advantage:

Go after a unique narrow Niche
Communicate this, so that everyone in the company focused on that niche
Re-enforce that focus every chance you get from the top down
Keep your teams as small as possible

5. You’re “closer” to your Customers. As a startup, you have the huge natural advantage of a) having more direct access to input from your customers; & b) having the ability to implement changes based on that input much more quickly and efficiently. That’s something most big companies would kill for and sorely miss. Here are a few ways you can make the most of closeness to your customers.

How to Fully Exploit this Advantage:

Connect as many of your employees to your customers – as you can
Establish Feedback Loops between Sales and the rest of your Team
Analyze your Customer Service for “improvements”
Monitor Social Media interactions
Get on the Phone with your Customers more often – instead of just with less personal – Email, Texting, etc.
Meet them in person (ie, Lunch) to discuss their perception of you and if you can make any improvements
Mine your Web analytics and expand what works
Incorporate “data gathering” into your Product sales or Service delivery
Make Customer Feedback highly visible across the organization

6. You can run on Low to Zero for Sales & Marketing Costs. One of the best ways you can battle your Goliath, is to make it your mission to operate as a Lean high efficiency Cash machine. The basic idea is to make everything you do — your product, pricing, customer service, etc. — so compelling that you can convert your target customers with little to no sales & marketing expense on your part.

Zero? The trick isn’t to cut out sales and marketing altogether, but to keep looking for way to keep costs as low as possible relative to the Cash Flow generated.

How to Fully Exploit this Advantage:

Focus on the user “experience”
Build Social-Sharing features directly into your product
Make your Sign up & purchase process as simple & easy as possible
Constantly improve your product
Incorporate Customer Feedback as much as possible
Have rapid Development cycles to new innovations out in the market asap
Leverage free Beta & Trial versions of your product – to get feedback
Price your Product / Services competitively – to get Market share

Comments: Are there any other Lean startup advantages you can think of?

from Overview Partners.com 18 Sept 14 enhanced by Peter/CXO Wiz4.biz

For more Info, click on Competition, Marketing, Starting a Business, Lean Startup.