http://www.perlmonks.org?node_id=1137353

The biggest waste in software development seems to be building the wrong product, or the wrong features

-- from How to build the right thing by Henrik Kniberg

There is nothing so useless as doing efficiently that which should not be done at all

-- Peter Drucker

I'd originally planned yet another installment of the long-running Agile Imposition series, reporting on Lean startup and related ideas. As I began my research however, I soon realized this is a vast, complicated and perplexing topic; a topic so important it can make or break your business.

So, to do it justice, I've decided instead to start a new series of articles on building the right thing.

Innovators Trump Ideas

Most new ideas fail, even if they are very well executed.

-- from The Pretotyping Manifesto by Alberto Savoia

At work we have a place where googlers submit their ideas; there are over 10,000 ideas. I call it the place where ideas go to die.

-- from The Pretotyping Manifesto by Alberto Savoia

If you have any doubt about the business value of ideas, try going to any venture capitalist and telling them: "I have a great idea that could be turned into a multi-billion $ business. I am not going to implement it, but if you give me a mere $10,000 I'll give you my idea and it's yours to do whatever you want with it." Just for fun, I created an ad peddling my services as an Ideator and posted it on Craigslist: "Ideator for hire. $10 per idea." I am still waiting for a serious reply.

-- from Innovators beat Ideas by Alberto Savoia

Leonard approaches them with an idea for a smartphone app that helps users solve Differential Equations and announces that nobody else is currently making an app like theirs. Because of Penny's presence, Sheldon is afraid Penny will steal Leonard's idea. He points out an "Unlikely, but very plausible scenario" that Penny befriends the gang to steal a marketable idea from them. Penny points out that she hangs out with them partly because she receives free food.

-- from The Bus Pants Utilization Big Bang Theory, Season 4, Episode 12

Sheldon's reaction notwithstanding, ideas themselves are of little value.

Though innovators trump ideas, backing an innovator -- even one with a successful track record -- is hardly a safe bet. Innovation is hard. Startups are risky. Indeed, the prime motivation of both Alberto Savoia (father of pretotyping) and Eric Ries (father of Lean startup) is that they both experienced both phenomenal success and catastrophic failure in different Startups -- and so became determined to figure out why.

Some Famous Product Failures

Many businesses disappear because the founder-entrepreneur insists that he or she knows better than the market

-- Peter Drucker

The Innovator's nightmare is spending years and millions to build and perfect a product or service that people don't need or want

-- from The Pretotyping Manifesto by Alberto Savoia

The throwaway merchants at Bic thought; I know we've been very successfully making disposable pens, lighters and razors, why not make disposable underwear for women?

-- from Biggest and Worst Product Failures

Some examples of spectacular failures caused by building the wrong "it":

Many other examples could be given.

What is especially tragic is when huge investments are made up front, then -- when the product idea is clearly failing -- instead of calling it quits, still more cash is pumped in. Until bankruptcy ensues. How to avoid this sort of tragedy?

Pretotyping

IBM 30 years ago did something very clever. They thought that speech to text would be the next big thing because managers could not type. Their market research told them that if they built a speech to text translator, people would buy it. As a small experiment they got people who said "we will pay $10,000 if you build it" and brought them to IBM. They put them in a room with a microphone and a screen, so they thought they had a speech to text translator when in fact they had a super typist in a hidden room! It sounded like a good idea. However, after using it, at the end of the day my throat is sore; and I cannot dictate confidential memos in an open office. After the test, folks said "I'm sorry, I hope you didn't build too many of them, because we don't want them".

The person who built the Palm Pilot, Jeff Hawkins, had an innovator's nightmare, lost millions. This time, instead of whipping my investors into a frenzy, this time let's test the idea with a little wood block and a tooth pick, and he went around for two weeks pretending he had built this Palm Pilot. After two weeks of this pretending, he said "You know, if this wasn't just a piece of wood I would actually use it". It had much less functionality than the Newton, yet was much more successful.

-- from The Pretotyping Manifesto by Alberto Savoia

Pretotyping: Validating the market appeal and actual usage of a potential new product by simulating its core experience with the smallest possible investment of time and money.

-- from The Pretotyping Manifesto by Alberto Savoia

The Pretotyping Manifesto:

False Positives and False Negatives

Remember Webvan, the originators of the idea of groceries ordered online, then delivered to your door? Conceived during the first internet boom of the late 1990's, the idea behind Webvan was an instant success in Thoughtland. Everyone gave it a thumbs-up, and why not? It sounded simple, convenient, it had that why-didn’t-I-think-of-that, forehead-smacking ring of genius.

Who can ignore Twitter? But when you first heard of the service, what was your reaction? Some may have thought it an intriguing experiment in real-time micro-broadcasting (though what evidence there was that this was a gap for people is unclear to me). But surely few intuited that it would ultimately power the democratic revolutions of the Arab Spring. The elevator pitch for Twitter has that terrier-twisting-its-head-to-comprehend, temple-scratching ring of insanity.

-- from Pretotyping@Work Invent Like a Startup, Invest Like a Grownup by Jeremy Clark

With Webvan, people who had been asked a hypothetical "would you use it?" question turned out to be far less enthusiastic when faced with a concrete "will you use it?" question.

By the way, seeking to learn from failure, Amazon has recently hired several of the original Webvan developers to launch a new Amazon Fresh grocery business.

It seems that False Positives are usually based on the opinions of acknowledged (and over-confident) experts. We pretotype because data beats opinions.

False Negatives, such as Twitter, are much rarer. Which leads us to Clark's second law of failure: too few crazy-sounding ideas get tried.

To avoid both False Positive and False Negative outcomes, revealed-preference market testing of reasonable proxies for the final product have to be achievable at much lower investments of time and money.

-- from Pretotyping@Work Invent Like a Startup, Invest Like a Grownup by Jeremy Clark

Some Pretotyping Techniques

A complementary approach to pretotyping that has made a big splash recently is Lean startup, the subject of the next installment in this series.

Perl Monks References

External References

Extra References Added Later

Updated Sep/Oct 2015: Added "Create a Video", "Partnership", "Audience Building", "Crowdfunding", "Single Feature", "Piecemeal Solution", and "Walking Skeleton" to "Some Pretotyping Techniques" section. Added Extra References section.