Our Lean Innovation expert Adrian von Orelli discusses examples of lean innovation in the hardware domain and talks about the mindset aspect of lean startup.

1. Dr. Adrian von Orelli
Zürich, December 16 2015
Lean Startup Hardware examples
126.2.15 www.pragmatic-solutions.ch
Angelday

2. Adrian von Orelli
• EE PhD ETHZ
• R&D leader
• Innovator
• 15 years of high tech
product development
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3. What are we talking about
• Discuss lean startup examples in the hardware domain
• Talk about the mindset aspect of lean startup
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4. Improve the success rate above 10%
5
• 66% of successful products/companies significantly change
original business idea
• Develop product in half the time and at half the cost (GE)
• Reduce failure: “wrong” product and “premature” scaling
• Success is not driven by the best initial idea, but by a team
that can learn fast what customers really value and have
discipline and speed in developing the solution iteratively
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5. In other words
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6. In SW this is ok but HW needs a
detailed plan to be executed.
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• Developing a HW product nobody wants wastes even more
money than in a SW project.
• HW is less flexible than SW. Incorporating user feedback
late in the game generates huge delays and costs.
• Feasibility of the solution is often not the highest risk
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7. Traditional versus lean approach
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Source: Hansruedi Lingg

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Three Innovation Horizons
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Horizon 1
Horizon 2
Horizon 3
Core Business
Emerging Business
Exploration
known
Semi-
known
unknown
New disruptive
business model
Business Model Innovation
Process Innovation
Todays growth &
tomorrows cash flow
Generate today’s
cash flow
Options on future
high growth business
Source: Baghai, Coley, White, Blank
time
$

9. Lean Innovation Framework
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10. Feedback loop
Design
experiment
Proposal, Pretotype,
Landing page, MVP …Results
Analyze results
pivot or persevere weeks
not
years
Assumption/
Hypothesis
Run
experiment
Creativity
happens here
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11. Hypothesis driven Development
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12. From Proposal to Product
4) Early version with minimal feature set that
can be sold to early adopters
1) Proposal: a document describing the solution
3) Fake demo of any kind
2) Smoke Test: Landing Page to test interest
MVPPretotype
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13. Pretotype Example (Hardware)
https://www.youtube.com/watch?v=M66ZU2PCIcM
How IDEO worked
in 1999
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14. Tesla
Leap of faith: In the future cars will run on electric
motors.
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MVP 1: «Lotus» MVP 2: «Model S»

15. Tesla
Model 3: 2017 @35ks
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16. MVP Examples DropCam
"Home surveillance
wasn't sexy before
Dropcam"
"Dropcam built a fan
base by creating a
product that's dead
simple to use at a price
much lower than other
solutions."
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17. DropCam surveillance camera
People who never would
have bought an IP
camera will buy a
Dropcam if they can
install it in minutes and
the Software is fun to
use.
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18. The result
“They grew 500% per
year and in 2014 sold
the company for
555Mio$ to Nest”
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19. Crowdfunding
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20. FitBit: MVP
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MVP 2009 : Simple Pedometer with charging
station and data connection to computer
2015
2009

21. MVP Examples: iPhone 1
• There’s no need for a keyboard, the
touchscreen can suffice
• A mobile phone can support a full web
browser, and this will be valuable to
users
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Excel at the core
use case, do the
rest later

22. MVP Examples: iPhone 1
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Global Apple iPhone sales from 3rd quarter 2007 to 1st quarter 2015

23. MVP Examples GoPro
Leap of Faith: People will
buy dedicated sports
cameras to take pictures
from their friends while
surfing.
“GoPro makes heros.”
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24. MVP Examples GoPro
The first GoPro
cameras used 35mm film
and were strapped to a
person’s wrist and only
captured pictures of the
ride. (2005)
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25. MVP Examples Jibo
MIT project raise
3Mio$ on Indiegogo”
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26. Minimal Viable Product
An MVP is NOT a crappy version of the final product.
The challenge is to achieve “minimal” and “viable”.
No one said that this is easy
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27. Combination of “what” and “how”
Scale
Product
Market
fit
Problem
Solution
fit
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28. GE Fastworks
https://www.youtube.com/watch?v=TgAk7xP2a1M
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29. GE Fastworks take aways
?
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30. Lean Startup is …
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An experiment driven approach for projects in
the domain of high uncertainty.
• Experimental results over arguments
• Strong compelling vision over detailed plan
• Validated learning over activity reporting