With increasing pressure to do more with less, businesses need to look at alternative methods to improve new product development and business growth.
To reduce high wastage of valuable resources, an approach that revolutionised the way businesses develop products and grow is Lean Startup, a principled approach to building products.
Built on this methodology is the practical Lean Analytics framework that leverages the power of data and insights. Given your business model and stage, if applied correctly, it provides structured guidance to building better products in shorter timeframes by integrating analytics into each of the various stages.
The framework can be applied in all types of businesses and help identify what works for the customer and what doesn’t earlier rather than later. This allows you to measure and effect change or improve the customer’s experience.
The Lean concepts are simple to understand but the application process can be complex and daunting. Learning how to practically assimilate which metrics to focus on and what data to measure can ease adoption of the framework and allows teams to operate on the same wavelength.
Other benefits of applying Lean Analytics include:
Improved and informed decision-making
High wastage in product development is costly and can have major implications for the business.
Improve your decision-making when exploring ideas for new products. Using facts and data to inform business decisions is a far better way than gut-feel, intuition or hearsay – enabling the businesses to iterate: build, measure and learn.
Applying learning and iterating quickly, improves the overall chance of achieving success.
Distinguish between vanity and good metrics
In our thriving 24/7 digital world, we are constantly bombarded with information, data and customer demands.
Businesses are quick to claim that they are data-driven but very few really understand what it means. Or data is used ineffectively for simple reporting or vanity metrics like number of registered users, mobile application downloads or page views are measured. Avoid analysis-paralysis. It is easy to become obsessed with senseless data. Businesses should dive deep to understand what “good metrics” are and how it informs behavioural change(s) and action.
When progress is measured and actions show results it can inspire a culture of innovation and experimentation across the entire organisation.
Track what matters: Balance quantitative and qualitative
Define and track metrics that matter.
Quantitative metrics will be informed by two things; (1) the stage of the business and (2) the business model.
Let’s depict an example. Assume you are the founder of a small game development studio and you are in the early stage of developing a mobile game. At this stage, it is retention metrics that matter. Metrics that relate to user acquisition is not important, metrics that indicate retention or the lack of it that matter e.g. churn. All focus should be on reducing the churn rate.
Quantitative data should be balanced with qualitative metrics to uncover insights that cannot be revealed by data alone. Insights gained from customer and market research are hugely beneficial in the product development process and should not be ignored.
There is absolutely no substitute for speaking to your customers and users directly, balance quantitative and qualitative metrics.
Diverse variables and uncertainties in the early stages can derail businesses from developing a product suited to its desired target market in the shortest possible time.
Given the intense competition and pressures that the current business environment beckons, can your business afford to not to measure its progress, waste valuable time, energy and resources?