If you’ve been debating whether or how to roll out the lean startup methodology in your organization, Bennett Blank of Intuit has a question: what are you waiting for?
“I can’t tell you how many times I’ve talked [about lean startup] with other executives who are like, ‘OK, we’ll spend four or five months benchmarking it, and then we’ll put together a program, and then we’ll spend eight months creating the curriculum, and then we’ll launch it next year,'” Blank told InnoLead members on a recent IL Live conference call.
“That’s the complete antithesis of the lean startup,” he said. Instead, he suggested asking, “What can you do in the next 24 hours that drives lean startup into your organization? That’s the lean startup way. Apply what you learn, and don’t overthink it. Just get started.”Blank is an innovation leader at the $4 billion software company Intuit, which makes software such as QuickBooks, Mint, and TurboTax. Among his responsibilities has been designing and running a training program called Lean StartIn (the “in” representing intrapreneurs.) Blank is also featured in our June 2016 research report, “
Lean Startup: Making it work in large organizations.”
Highlights of the IL Live call are below, or you can click play to hear the whole conversation. (Clicking the “down arrow” at right will download an MP3 file for later listening.)
Where I Sit
I’m not actually in a business unit. I’m in our central organization, our CTO organization.
Our charter is really to help the entire company, all the business units, become more innovative and deliver for our customers. A lot of what I do is researching and experimenting with best practices in terms of culture, tools, process, and then sharing everything we learn with the rest of the organization.That may be in the form of workshops. It might be in the form of strategy. It might be in the form of coaching, but our job is really to advance the company forward in terms of culture. My boss is the Vice President of Innovation and Transformational Change.
In addition to the innovation, we do a lot of culture transformation in partnership with our CEO and founder, who are both obviously very excited about making sure our innovation culture remains vibrant…
One of the Oldest Startups in Silicon Valley
We like to joke that Intuit is one of the oldest startups in Silicon Valley. We’re at 30-plus years now, but would still like to think we’re always looking towards the future. In the consumer software and small-business software space, it’s a rapidly-evolving landscape.
If you’re not staying on your toes, or looking at the future, and trying to invent it yourself, then somebody else will do it for you, and that won’t be good for anyone. …Whether you’re 30 years old or three years old, everyone is under the same pressure to constantly innovate and improve our customers’ lives.
“Design for Delight” and the “Lean StartIn” Workshop
We actually have a program called Design for Delight, which is our own internal version of design thinking, which had become quite popular at Intuit going back as far as 2007, when that program kicked off. That program has three pillars or principles that we lean on.
The first is customer empathy, so we strive to be customer-centric and put the customer at the center of everything we do. The second is going broad before we go narrow, which really just is encouraging folks to explore many opportunities and potential solutions before we settle on one. Then the third principle is rapid experimentation with customers.
The premise behind that, of course, is that we want to test those solutions we choose with our actual customers in a real-world environment, to see whether or not they’re actually delivering the value that we hypothesized it deliver.
When Eric Ries and the other folks that are in the lean startup community started talking about a more formal way to think about this, it really fit very well with our rapid experimentation principle. I don’t want to say it was easy, but it made a lot of sense for us to talk about in the context of some of the programs that we already had in place.
It really gave a boost to our Design for Delight program, and then also we were able to leverage the awesome book that Eric released [“The Lean Startup”]…
From there, our “Lean StartIn” workshop (the “in” stands for intrapreneurs) is one of many different things that we did to try to institutionalize lean startup — the attitude that there’s always something you could be doing faster to test those hypotheses, and encouraging people to be explicit with the hypothesis that they’d actually want to go test.
Trying to move faster is one of the most important things you can do in an organization. Certainly, being clear about what you’re trying to actually go test and learn from the market is something I’ve noticed a lot of folks struggle with.
They start with, “This would be a great idea because,” and here’s some data behind it, but at the end of the day, if you haven’t created an experience to deliver on that concept, and then tested that experience, you’re ultimately always going to be off-course. We saw that at Intuit as well, and thought that was a problem worth solving.
Dealing with Resistance
I wouldn’t call it resistance, but [early on we did get a lot of] questions… Luckily, Intuit is very open to new things, so we don’t get a lot of pure skepticism. What we do get a lot of is questions. Why would you do this? Why do you believe this would be better than what we do today? What are your own hypotheses?
Nobody wants to spend too much time, and spend more money than is required to deliver [something] late. Nobody wants that, so I think the first suggestion I would give folks as you start to talk about [lean startup] is, use the words and the lingo of your organization, in terms of the benefit it might provide….Of course, some of the details of how you do rapid experimentation in market, folks are nervous from time-to-time about how you would use a brand, and shipping a product that’s minimum viable versus complete. What does that even mean?
We had a lot of conversations around, what does the minimum viable product look like that you could attach one of your brands to, versus something that would be a brand-new market idea… Lots of conversations around, are there going to be legal ramifications? We’re in the financial services world, and obviously it’s more sensitive, and regulated, than some other industries.Are we going to lose customers? Will they hate us? All that good stuff that folks worry about every day. We ran up against a lot of that. Again, not in terms of people telling us to stop, but just a lot of hard questions, which frankly, should have been asked.
I think one thing we did really well in early stages to bring those folks not just into the conversation, but we actually invited them to some of our early workshops and said, “You are now participants, and the problems that you’re going to work with are solutions for the other people in the room.”
We had one person come in with the legal challenge of contacting customers. You might imagine reaching out to customers. Should anybody just be able to do that in a company? Those are very valuable contacts. Legal and branding folks said, “That should be controlled. You can’t just let any employee go out there and start calling up customers.”
At first blush, that seems a little bit crazy, but one of their teams that went through this workshop decided to…put the word “product” in quotes. What they created was a series of guidelines for rapid experimentation teams. If you fell below the guidelines, you actually didn’t have to get any approval at all. No approval from branding, no approval from legal. You could actually go run your experiments with customers, and contact customers, and have conversations with them without having to involve anyone.
Of course, that’s very empowering for teams, and that kicked off the first round of opening the floodgates for folks to go out and actually communicate with customers.
$30 Million+ of New Revenue
Early on, the folks who were coming to our workshop were folks that wanted to explore new ideas, or really push the boundaries of existing products. In the process, they were actually able to get literally hundreds and hundreds of customers to test a wide variety of different products.
…Intuit doesn’t really have an R&D situation where we incubate and launch brand-new product lines. What we do a lot is adopt those things and move them into our existing core products.Many new features and innovations that were proven in just a few days to have some merit…would then be adopted by the core teams that would then create those products as part of the core offering. We’ve had many success stories — I don’t even want to use the word incremental innovations, because that makes it sound too small.
In the first 18 months or so [of the program,] it was $30 million plus in new revenue to Intuit that was attributed to ideas that went through the program.I joked, at the time, that it was really just me and somebody else who were running these workshops, and they’re already paying for us, so it’s infinite ROI. Very big bang for the buck, just spending a few days learning how to do these techniques, and then applying it back to their day-to-day work.
…If you ask anybody who’s on those teams, they will say, “Yep, if I didn’t have this opportunity to go test my idea, and I wasn’t taught the tools and techniques of how to go do it in a fast, cheap way, my idea probably would’ve never gotten off the ground, because it never would have passed a more traditional funding barrier or product proposal pitch. We simply didn’t have the certainty of ROI and the things required to get it done that way.”I think the second piece that I find most interesting is, that specific workshop is not about the output in terms of new products and markets, or this idea started here, and now it’s over here generating X dollars. It was really about transformational change, and cultural change, and making sure that our employees understand what we mean when we say rapid experimentation, and what we mean when we say, “Put your idea to the test, or let’s talk about things in terms of the hypotheses.”
The Value of a Shared Vocabulary
A lot of those words — hypothesis, evidence, leaps of faith — those things weren’t explicitly a part of our culture, and so it really helps to create a shared vocabulary around what an experiment actually is. When you’re talking to your fellow employees about your work, you can say, “Well, I’ve got to be honest. In this case, it’s just a hypothesis, and we don’t know right from wrong, but we have a test to go get the answer, and here’s what that test looks like.”
Before, you might have had people saying, “Well, I out-analyzed you, and I am higher ranking, and so just take my word for it that this is worth investing in.”…That’s the real win, when the culture gets shifted, and it starts to take hold in other places in the organization. You see huge, huge, huge improvement.
Giving Innovators an Allowance
We’ve experimented with giving some [funding], and not giving some. …In the early stages, we gave folks that came to our program a small budget. They would buy things like AdWords, or they could create templates, or buy a domain name — sort of small things they needed to do to actually put their product out in market. …[Unlike Adobe’s Kickbox program,] we gave not so much standard [amounts of funding,] but small chunks of money to people to actually build their experiments. That’s where we focused our energy.
We would give in the hundreds of dollars. It’s most important purely from the empowerment perspective. When you empower employees, they will do amazing things. Whether you give them $1,000, or $10,000, or $100, just giving them the money is important part, and saying, “You can spend it on anything you want, on anything that’s driving your experiment. It’s up to you to make the call.”At Intuit, most employees have a corporate credit card, and so we would just earmark funds on that. It wasn’t like a secret debit card, where you get to keep the money if you want, and you can spend it on what you want.
How the Lean StartIn Workshop Links to the Business Units
Anyone can come to the workshop. For example, we might have a team from QuickBooks who has a hunch that there’s a different feature that they should be prioritizing, or a different opportunity that they should be prioritizing, but they can’t get started on that because of their pressures of their daily job. They’ll come to a workshop, and experiment on the side with a new concept, or different way of doing it, which will prove to be better. Then they can just take that right back to their day job and say, “We’re going to stop doing this, and do this other thing.”
There is also a process where we connect to the teams that are working on ideas that are showing a little bit of traction with the senior business leaders. We try to get them to align [their idea] with the metrics that business is trying to solve for. One thing that’s unique at Intuit, we have something called customer benefit metrics, and they’re not business metrics. They’re improvements in the customer’s life.If that idea is actually improving the customer’s life in a way that is important to that product or business unit, they are usually open to at least having a conversation about it. Then, from there, it’s to either be discussed as an add-on to something, or the learning is incorporated into the core product. If it’s unique enough, it might exist on its own for a little while.
“Go Where You’re Loved”
…One of the tips I always give is, “Go where you’re loved.” Don’t try to convince a giant business unit that has no interest in innovation to come to your workshop. Just create something very small, like twenty people. Our first event was 12 people, and we actually did it over a weekend, in the corporate offices, but on a Saturday and Sunday, for people who were passionate about startups. At that time — this is even before Eric’s book came out — there wasn’t necessarily time to do that, and take people away from their day jobs.
You’ve got to start small, go where you’re loved, get a couple of like-minded people in the room, and then when you see success, start sharing that as quickly and loudly as you possibly can. You’ve got to bang your own pots and pans together.
At about our fourth event, we actually sent a note to our CEO saying, “You’re not going to believe what’s going on here. We started these workshops, and people are moving faster, with almost no money, and they’re actually getting learning very quickly from the customers, and they’re actually able to apply that back to the core products. We think that’s exciting, you should come by.”
It turns out he did, and he showed up. It was sort of a surprise to us, actually. He came for the final pitch of one of these two-day workshops, and he was blown away by what he saw, and very encouraging to the teams for having participated. You can imagine some of the teams are mortified that they were going to have to present in front of the CEO after being awake for two days.
Then, of course, we started highlighting the results, and saying people who were coming to this workshop felt more empowered. They were more positive about their job. They now had the tools and resources to go do stuff, when they felt that there was something different Intuit should be doing.
We shared that with anybody who would listen. We were our own marketers. For those of you who are thinking about doing this, you will not have much help. That’s what startups are faced with, and so you’ve got to apply these tools and processes to your own programs.
Bang your own drum. Nobody else is going to do it for you. Once you start to gain some traction, assuming it does, then those other folks will come to the party.
[If you’re working on lean startup or other kinds of cultural change initiatives,] your customer is the organization, and so you have to have empathy for the organization, and understand that if people are trying to squash you, they’re not doing these things irrationally. They’re doing it for a very specific reason, and so you need to understand them as your customer.If you’re creating a workshop, or some way you’re going to be hopefully changing the hearts and minds, there has to be a benefit to them for that. Don’t go to the laggards in the organization and try to convince them to do this. Go to your early adopters, go to your innovators, and target them directly. Start very small. The number one thing you can do is apply the lean startup mindset to this program.
Recommended Books and Videos
For those of you who aren’t familiar with Steve Blank — no relation to me — he’s got a whole series of videos, hundreds of them talking about “search versus execute” and some of the corporate judo moves that you need to apply. I’d recommend anything from him. Of course, Eric Ries’ book, “The Lean Startup ” is great. We brought in someone named Brant Cooper in the early stages for us. He wrote a book called, “The Lean Entrepreneur,” which I found quite good. Ash Maurya has got some great stuff.
“Lean Analytics” is another book I really like…but I think ultimately Eric’s book [“The Lean Startup”] captures the spirit of it, for sure.
“Just Get Started”
I can’t tell you how many times I’ve talked [about lean] with other executives who are like, “OK, we’ll spend four or five months benchmarking it, and then we’ll put together a program, and then we’ll spend eight months creating the curriculum, and then we’ll launch it next year.”
That’s the complete antithesis of the lean startup. No, what can you do in the next 24 hours that drives lean startup into your organization? That’s the lean startup way. Apply what you learn, and don’t overthink it. Just get started.
Today, when you’re done with this phone call, you’re going to have what, two-and-a-half hours before the end of the day? I guarantee you that anybody who’s interested in lean startup can create an experiment in that amount of time. Maybe not execute it, but certainly create it. Do it by the end of this week, done. That’s lean startup. If you can’t do that, you maybe should consider trying something else.
I don’t mean that in a mean way. I just mean you’ve got to live the principles yourself.
We didn’t have [data or success stories] when we started. …There’s lots of articles written about lean startup, but you’re going to have to create your own data. Again, that’s the job of whoever’s leading this program, to do that, and to be humble and honest with the organization: “We don’t know this will even work, but hey, it seems other companies are making huge strides with it, so it’s probably in our business to run an experiment. Let’s do that.”