module 1 - lesson 6 constraints 2... · module 1 - lesson 6 constraints ash. 3 2 1 repeatability 3...
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1 Repeatability
3 ATTRIBUTES OF A SYSTEM
Constraints
Throughput
How do you achieve right action, right time?
Problem Solution Unique Value Proposition
Unfair Advantage
Customer Segments
Key Metrics Channels
Cost Structure Revenue Streams
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Everything here is a risk
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Problem Solution Unique Value Proposition
Unfair Advantage
Customer Segments
Key Metrics Channels
Cost Structure Revenue Streams
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Systematically de-risk your vision
customers
investors
entrepreneur
team
Prioritize tackling what’s riskiest, not what’s easiest in your business model.
Systematically test your plan
Identify the riskiest partsof your planDocument your Plan A
Systematically test your plan
Identify the riskiest partsof your planDocument your Plan A
01 Use your intuition.
Incorrect prioritization of risk is the top contributor of waste.
02 Start with top 3 universal risks.
Problem Solution Unique Value Proposition
Unfair Advantage Customer Segments
Key Metrics Channels
Cost Structure Revenue Streams
Lean Canvas is adapted from The Business Model Canvas (http://www.businessmodelgeneration.com) and is licensed under the Creative Commons Attribution-Share Alike 3.0 Un-ported License.
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Early AdoptersExisting Alternatives
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03 Seek out domain experts.
Problem Solution Unique Value Proposition
Unfair Advantage
Customer Segments
Key Metrics Channels
Cost Structure Revenue Streams
Help me, help you. - Jerry Maguire
Advisor Paradox: Hire advisors for advice but don’t follow it, apply it.
-Venture Hacks
There is a better way that doesn’t require guessing.
Theory of Constraints:
Every business is a system of interconnected processes with a single constraint.
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 7 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 7 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
1. What is the maximum system output per day?
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 7 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
1. What is the maximum system output per day?2. Where is the constraint?
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 7 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
Throughput is 7 units/day
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 12 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 12 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
1. What is the maximum system output per day?2. Where is the constraint?
StepA
StepB
StepC
StepD
StepE
10 units/day 15 units/day 12 units/day 9 units/day 10 units/day
MARKET DEMAND12 units/day
Production Example
New throughput is 9 units/day
StepA
StepB
StepC
OUTPUT3 customers/day
Customer Factory Example
Acquisition
Activation
Revenue
20 signups/day 6 users/day
POTENTIALMARKET DEMAND
100 visitors/day
Equipment Capacity: 10,000 users/day 1000 users/day 1000 users/day
People Capacity: N/A 20 users/day 20 users/day
Conversion Rate: 20% 30% 50%
Time To Conversion: 5 minutes 7 days 20 days
Constraints help you identify right action, right time.
It’s time to act on your big idea.Validate and grow your business idea with advice from top business model coaches and lean experts.
Ash Maurya | Author, Running Lean | Founder, Spark59 | @ashmaurya
Life is too short to build something nobody wants…