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Entrepreneurial Management MBI: the Lean Startup Concept


The old MBA paradigms based on long and complex, analytics-based strategic plans, demographics and focus groups research, large investments on a new product or service and even larger in marketing and sales campaign are plainly obsolete. Cash-rich, brand-recognized companies like Apple can afford it and still practice, but are experiencing the symptoms of falling behind: new products and competitors come out first or -even worst- make an entire category obsolete.


Anyone looking for a Tablet PC or a GPS? Or a better laptop?


The rise of the FANG[1] era has taken entrepreneurship to an entire new level. The combination of smart phones, social media and instant, free-access to global markets  lowered dramatically barriers to entry and leveled the play field for innovative startups. Furthermore, the FANGs created an entirely new world of virtual, global communities of users glued to their smart phones for shopping, working and socializing.



In this brave new world, ruled by what Thomas Friedman calls "the Great Acceleration of 2007[1]" (after the year Apple launched the first iPhone[2]) new companies like Uber pop into the market at a "FANG speed" of 1.7 Apps per minute
























Post-FANG startups thrive of short design and business cycles, minimal upfront investment and constant experimentation testing Minimal Viable Prototypes (MVP) with real customers in continuous Build-Measure-Learn loops.


Instead of designing the "perfect" product, we start by building a Minimal Viable Prototype, defined as


"That version of the product that enables a full turn of the Build-Measure-Learn loop with a minimum amount of effort and the least amount of development time. The minimum viable product lacks many features that may prove essential later on. However, in some ways, creating a MVP requires extra work: we must be able to measure its impact."


Then, we can collect meaningful data about the impact (desired vs. actual) and Learn what matters for a better MVP until we "strike oil" (a strong and steady stream of paying customers or transactions)




A startup is not a "baby company", but a controlled experiment for establishing a viable, value-adding business.


Organization and structure can (and must) come first, in order to make possible the many fast cycles of controlled failure required to succeed.


At its heart, a startup is a catalyst that transforms ideas into products. As customers interact with those products, they generate feedback and data. The feedback is both qualitative (such as what they like and don’t like) and quantitative (such as how many people use it and find it valuable)."


The key is in finding better ways to add value -either by improving existing client experiences (like Amazon or Uber) or by creating an entire new categories -like smart phones that can replace credit cards, wallets, GPS and laptops-.


Both Zappos and Amazon started very small, offering a small selection of shoes and books online and focusing on delivering and returning items personally.

 Based on their experience doing the job, they could refine and redefine ways to make the shopping experience easier, saving time and money to their customers and making quite a bit -a few bucks at each click- to grow into companies.


The new concept has also been used in creating new programs, such as the transformation of Barrio 31, in Buenos Aires


 Or creating new ways to engage and influence government at all levels through social media such Votizen does, after several attempts using Lean Design:



At the Performance Improvement Institute, we replaced the old MBA curricula for a new set of entrepreneurial programs: MBI for Masters of Business Innovation in the for profit sector and MSI for Masters of Social Innovation, in the nonprofit sector (NGOs, communities and government), following the Lean Startup concept. 





References and End Notes


[1] (Friedman, 2016)


[2] (Wikipedia, 2017)




[1] FANG is the acronym for four high performing technology stocks in the market as of 2017 – Facebook, Amazon, Netflix, and Google (now Alphabet, Inc.). The term was coined by CNBC's Mad Money host Jim Cramer. (Investopedia, 2017)


[2] (Bernardez, The power of entrepreneurial ecosystems: extracting boom from bust, 2009) (Bernardez, The Future of Jobs and the Jobs of the Future: A Decade of E-Performance, 2017) (Lashinsky, 2017)

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