Build What Customers Want

www.rallydev.com @zachnies! ©2013!
Build What
Customers Want!
Zach Nies – Chief Technologist!

Zach Nies
@zachnies
Zach Nies, Chief Technologist
Rally Software

Font Sampler!
http://en.wikipedia.org/wiki/File:Caslon-schriftmusterblatt.jpeghttp://media.kelbymediagroup.com/layersmagazine/images/columns/artoftype/may06/glyph-set.jpg

I love to change
industries !

Apply new 
disciplines!

Become
disciplined
explorers…!

who know how to
balance
exploration 
and execution!

Build what 
people want!

Take advantage
of market
opportunities!

What happened to
this company?!

1 2 5
iPhone Released1
iPhone App SDK Released2
Android w/ Nav Released5
Major Recession3
3
iPhone App Released4
4

A lot can !
happen in 
1.5 years.!

Incumbent
advantage 
is going away!

Easier for startups
to change
industries!

What’s changing?!

Time to excellence!

http://en.wikipedia.org/wiki/File:Disruptivetechnology.gif

http://en.wikipedia.org/wiki/File:Disruptivetechnology.gif
Excellence!

Some examples…!

1984!

2006!

About 20 years!

2001!

5 years!

2007!

2010!

3 years!

2012!

2 years!

2008!

4 years!

“The Tesla Model S outscores every other car 
in our test Ratings.” – Consumer Reports!

1979!

1989!

10 years!

2.5 years!

1.5 years!

http://hbr.org/2013/03/big-bang-disruption/

Startups are more
powerful
disrupters!

Impact on
companies!

500

Question:!
!
How long does the average company
on this list survive?!

1958: !
Average lifespan was 61 years!
!
2012: !
Average lifespan was 18 years!

8 years!

Incumbent
advantage 
is going away !

How does this
impact Product
Development?!

Role of uncertainty!

Where does
uncertainty live?!

Brown, Tim (2009-09-16). Change by Design (Kindle Location 1984). Harper Collins, Inc.. Kindle Edition.

Level of uncertainty!

What to do!
Operate!

What to do!

What to do!
Big 
Companies!

Big
Companies!
http://www.flickr.com/photos/ironnickel/6076087519

Startups!
http://www.flickr.com/photos/elcapitan/2387917709

Aligning action 
with uncertainty!

http://www.flickr.com/photos/isaacmao/380257543
Create a plan to
predict the future!

Market research!
Product deﬁnition!
Product requirements!
Detailed plan!
Alpha release!
Beta release!
Final release!
FIRST CONTACT WITH
CUSTOMERS!

Market research!
Product deﬁnition!
Product requirements!
Detailed plan!
Alpha release!
Beta release!
Final release!
FIRST CONTACT WITH CUSTOMERS!

HOW MANY
GUESSES?!

FIRST CONTACT
WITH POTENTIAL
CUSTOMERS!

http://www.flickr.com/photos/oregondot/4132135156

Obscure 
the uncertainty 
with details!

Embrace and
reveal 
the uncertainty!

What we need 
is a way to 
discover the future!

Uncertainty!
Knowledge!
Experiments!

Discover the future!Form
Pivot
Persevere
Validate
SalesPlaybook
Ourdraftsalesplanwill
closeoractivate
customers.
GoToMarket
Wecanpackage,price,
positionandpromote
ouroffer.
Founders Can Sell
The founders can
understand the flow of
money and sell the offer.
OperateDiscover
Solution
Ourproductidea
solvesthecustomer’s
problem.
BusinessModel
Ourbusinessmodel
canbeprofitable.
Problem
We understand the
problem a customer
wants solved.
Transition
Team
Wehavebudgetandadedicated
transitionteam.
IntoDepartments
Wetransferredourknowledgeintothe
departmentsandtheycanoperatethe
newoffer.
RollOff
Wehaverolledoffeveryonefromthe
discoveryteamwhowantstodo
somethingnew.
Pivot
Persevere
Today’s spend fuels high growth
offers with an expected return
in 12 to 36 months.
rs
s
s
ExperimentExperimentExperiment
FrameHypothesize
Wehaveapredicted
outcomethatwecan
measureandfalsify.
Document
Wehavecompletedtheleft
sideofanExperimentA3.
Empathize
We understand the
perspective of our users &
customers.
Measure
Analyze
Wehaveafactbased
argumenttoinvalidateor
validateourhypothesis.
Organize
Wehaveturnedthedata
intoinformationweuseto
tellastory.
Collect
We have enough data to
effectively analyze the
results.
Learn
Complete
Wehaveacompleted
ExperimentA3.
Share
Wesharedtheresultswith
thosewhocouldbenefit
from
theknowledge.
Compare
We compared the data
collected to our expected
results.
Build
Deploy
Wehaveourexperiment
runningwithrealsubjects.
Implement
Wehaveasolutionthatcan
falsifyourhypothesis.
Design
We understand how to
build our experiment and
measure the results.
Knowledge
Enumerate
Experiments
We have a series of
experiments that will
test the validity of
our top leap of faith
assumptions.
QuarterlySteering
Demo
Demo
Demo
Demo
Demo
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Operational
Review
Operational
Review
I-2
Prepare
Review Canvas
We have an updated canvas that reflects our
latest learnings and the team has reviewed it.
Enumerate Assumptions
We have a list of assumptions that need to be
true for our offer to work.
Identify Key Assumptions
We have identified the 3 most important leap of
faith assumptions to test next.
Vision
Wehaveanideaworth
pursuingthatexcitesthe
team.
InnovationSandbox
Wehaveworking
agreementswithothersto
runadiscoveryprocess.
Team
We have a dedicated, cross
functional team.
© 2013 Rally Software Development Corp.

http://www.flickr.com/photos/klearchos/4541072707
Vision!

The idea is not
the thing that
matters.!

What does
matter?!
!
According to Simon Sinek!

Why you’re doing
it matters.!

Discover the future!
Exploration
Knowledge
Enumerate
Experiments
We have a series of
assumptions.
Cad
Quarterly
Mentor
Checkin
Mentor
Checkin
Prepare
Review Canvas

Business Level!

Feature Level!
5. Value
What value will be created for these users?
Workarounds
How are these problems being solved today?
1. User Personas
Who is encountering the problems?
Circumstances
Within what circumstances do these problems exist?
3. Solution
What solutions may make the problems go away?
4.Technology
What technologies will be used to create the solution?
8. Feedback
What meaningful and measurable feedback will be
gathered from the users?
9. Enablement
What will be needed to make these users aware of
your solution and how it solves their problems?
7. Cost of Development
What costs will go into solving the user’s problems?
6. Cost of Delay
What will it cost your business if you don’t solve these problems over a period of time?
2. Problems
What problems are these users encountering?
Feature Canvas
I-1
Adapted from the Lean Canvas (www.leancanvas.com)

Assumptions!
AssumptionsCanvas Name: Date:
Key Assumption
Dependent Assumptions
Falsified Assumptions
Other AssumptionsOther Assumptions
Key Assumption
Key Assumption
I-1

Assumptions!
Knowledge!
Experiments!

Empathize & Frame!
Test & Measure!
Build&Ship!
Learn&Share!
Experiments!

Experiment Backlog!
Exploration
Docum
Wehavecompleted
sideofanExperiment
W
persp
Knowledge
Enumerate
Experiments
We have a series of
assumptions.
Cad
Quarterly
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Prepare
Review Canvas

Experiments!
Background: What do you want to learn and why?
What guess, assumption, risk, or question are you testing?
What pain or problem is being experienced that’s motivating this experiment?
If you can, write the Problem Statement from the Define worksheet here.
[Customer Segment] needs a way to [describe job to be done], (because|but|surprisingly) [describe insight].
Hypothesis toTest
[Specific repeatable action] will create [expected result].
State your hypothesis as an if/then assertion. Is this hypothesis falsifiable?
Experiment Materials and Method
What will you need to run your experiment, both from your team and from others?
Describe the experiment you plan to run and how it can falsify your hypothesis. What steps are needed to run the
experiment? Do you need a control group to establish a comparison?
Safety: How is the experiment safe to run and how will you undo it?
Why is the experiment safe to run? What about your experiment method protects you from harmful side effects?
Describe how you will undo the experiment upon completion or if you discover it is no longer safe to run.
Variables and Measures
What variable (the manipulated variable) are you going to intentionally change during the experiment? What variables (the
responding variables) do you expect to respond to changes to the manipulated variable? What variables (the control
variables) do you need to keep constant during the experiment? What qualitative and quantitate measures will you use to
measure your variables? What will you measure to indicate the experiment is running safely?
Experiment Name:
Owner:
Mentor: Start Date: End Date: I-4
Next Steps: Given what you learned, what’s next?
Experiment Results
Describe your results from the experiment.
Describe what you learned from the experiment? Did you invalidate your hypothesis or does it live on?
Experiment OutcomeExperiment Outcome
Validated Invalidated InconclusiveValidated Invalidated Inconclusive
Cycle Time: days Cost: $ (Run rate * Cycle Time) + Costs
Validated Learnings
Describe what you learned from the experiment?
Restate your hypothesis based on the results. If it was validated, restate it as it is. If it was invalidated, frame the
hypothesis in the negative rather than the affirmative. If it was inconclusive, leave this box blank.
Ancillary Insights: What else should you explore?
Capture your insights that were gained unintentionally through this experiment.

Run experiments!
P
Per
SalesPlayb
Ourdraftsalespla
closeoractivate
customers.
ToMarket
anpackage,price,
itionandpromote
ouroffer.
Solutio
Ourproductid
solvesthecustome
problem.
nessModel
businessmodel
anbeprofitable.
Tea
Wehavebudgeta
transitio
IntoDepa
Wetransferredour
departmentsandth
newo
Roll
Wehaverolledoffe
discoveryteamw
somethi
P
Per
Frame
Hypothesize
Wehaveapredicted
outcomethatwecan
measureandfalsify.
Document
Empathize
We understand the
customers.
Measure
Analyze
Wehaveafactbased
Organize
Wehaveturnedthedata
tellastory.
Collect
results.
Learn
Complete
Wehaveacompleted
ExperimentA3.
Share
from
theknowledge.
Compare
results.
Build
Deploy
Wehaveourexperiment
Implement
Design
Knowledge
Enumerate
Experiments
We have a series of
assumptions.
QuarterlySteering
Demo
Demo
Demo
Demo
Demo
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Mentor
Checkin
Operational
Review
Operational
Review
I-2© 2013 Rally Software Development Corp.

Empathize & Frame!
Frame
Hypothesize
Wehaveapredicted
outcomethatwecan
measureandfalsify.
Document
Empathize
We understand the
customers.
De
Wehaveourexp
runningwithrealsub
We
build
m
owledge
umerate
periments
ave a series of
ments that will
he validity of
p leap of faith
sumptions.

Build & Ship!
othesize
ehaveapredicted
outcomethatwecan
measureandfalsify.
he
ers &
M
Org
Wehaveturnedt
intoinformationweus
tellastory.
We h
effe
Build
Deploy
Wehaveourexperiment
Implement
Design

Test & Measure!
Measure
Analyze
Wehaveafactbased
Organize
Wehaveturnedthedata
tellastory.
Collect
results.
Sh
Wesharedtheres
thosewhocouldben
from
theknowledge.
We
colle
lement
veasolutionthatcan
w to
and
ts.

Learn & Share!
e
alyze
haveafactbased
rgumenttoinvalidateor
a to
the
Learn
Complete
Wehaveacompleted
ExperimentA3.
Share
from
theknowledge.
Compare
results.

TAKE EACH MAJOR
ASSUMPTION!

RUN AN EXPERIMENT!

http://www.youtube.com/watch?v=Iyjs3zeoSrM

http://www.richard-feynman.net/gallery.htm

Technology adoption
is a human
phenomenon !

Not a technological
phenomenon !

An example…!

Need human
centered approach!

“Get out of the
building!”!
Steve Blank!

“Meaning emerges
through
interaction”!
Dave Snowden!

Your turn!

Add a gift giving
feature to Instagram!

The impact of
innovation is
changing!

Take advantage of
market
opportunities!

1
Began Using Lean Startup1
2
$50M in New Product Revenue2
3
1800 Concurrent Experiments3

Books that informed this talk!

Geoffrey 
Moore!
David Snowden!
Ash 
Maurya!
Tim 
Brown!
Clayton 
Christensen!
Steve 
Blank!
Eric 
Ries!
People who informed this talk!
Brant Cooper
Patrick
Vlaskovits!

Go Agile. Go Rally.!

Build What Customers Want

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