Chapter 8. Models And Frameworks – Foundations for Organizational Foresight

8. Beck’s Agile Development and Ries’s Lean Startup Cycle (Speed, Efficiency and Innovation)

Both time and resource efficiency and innovation capacity have become key goals in the modern software industry and for business startups. Thus they particularly prized in software startups. Today, nowhere else is the pace of change as fast, or the potential economic prizes as great, as for a small company creating a new software product or platform. In our increasingly connected world, a good software product can bring millions of users and tens to thousands of millions of dollars in acquisition offers to diligent and lucky founders in the space of a few months to a few years.

Beck et al.’s Agile Methodology

Beck et al.’s Agile Methodology

In this accelerated, high-stakes environment, agile software development methods, which stress constant cyclic iteration and incremental improvement, have had a big influence on software engineering, particularly in startups, since their emergence in Kent Beck et al.’s  Manifesto for Agile Software Development in 2001. Agile methods involve a Design-Develop-Test loop for the initial software that is done as a very focused and time-limited sprint, usually with a very small group of talented developers working in isolation, followed by release of that iteration to testers and users in period of Testing and Discovery, then a return to the next sprint of the cycle (picture above right). Since this Design-Develop-Test-Discover loop is another OPDCA-variant learning cycle, the more times one can apply the cycle, the more opportunities there are to learn how to improve efficiency and useful innovation, or product-market fit.

Ries (2011)

Ries (2011)

Agile methods are part of the broader category of lean manufacturing, the Toyota-inspired production approach that uses just-in-time workflow and a low-planning, customer- and learning-oriented style of innovation. Since 2008, a lean startup literature has also emerged, to help individuals, teams, and startups to apply agile/lean decision and action cycles to their work. Eric Ries’s Lean Startup (2011), is a great primer on this model.

Reis’s lean startup cycle, (Envision)-Build-Measure-Learn, is yet another variant of OPDCA. It includes new advice on maximizing efficiency and innovation, such as minimizing cash flow in the early years of applying the cycle, continually testing new and unfinished builds with end users to maximize useful experimentation and feedback, and tying development strategy, funding, and incentives to user traction, to maximize potential profitability of the firm’s innovation efforts. As the business world gets faster and more competitive, it is an easy prediction that the evidence for and use of fast and lean decision-action cycles (Boyd, Ries, and Taylor) will only continue to grow.

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