How to save client’s development budget and deliver valuable features to users with Lean Canvas

lean canvas

Obviously, the goal of any product is to provide a perfect value to its users through a perfect value creation process that has zero waste.

Being involved in digital product development, I often watch the opposite cases when a client requests and pays for the development of the features which are eventually abandoned by the users. As a result, the client runs out of the budget left with a frankenstein product.

To avoid this, all the new product feature ideas should be validated by the users before the development actually starts.

In this article, I will tell you how we implemented Lean Product Canvas – a tool for ideas validation – on one of our projects to accomplish this and let our client deliver a valuable product with no time and budget waste.

Project background

Our client is the Traffic Engineering and Operations department of the Regional Municipality of Durham, Ontario, Canada.

Their primary responsibility is to engineer and operate a safe and efficient road network in the region.

To support their day-to-day operations they use Matrix – Integrated Traffic Data Management System. It processes road sensors data and displays it on an intuitive map-based user interface.

When the client addressed Transparen with the request to update the system, it turned out that the changes determined by the R&D office would have required the development from scratch. Such option satisfied neither our client since it was budget and time consuming, nor our team as it would have led to permanent stress because of a tight deadline.

Instead of starting the development of the new system features, we suggested conducting a business process audit to define the areas which intersect with the system and determine all the possible bottlenecks in it.

Further, to filter the successful feature ideas and flexiblу manage the fixed development budget, keeping the buffer for any critical issues, we offered our client to use the Lean Product Canvas approach.

lean product canvas model
Picture 1 – Lean Canvas Model

 

Lean Canvas step-by-step practical guide

Customer segment. For whom are we solving a problem?

When creating a product or planning a new useful feature it’s extremely important to define whose problem it helps to solve and for whom we are creating a solution.
So as our first step, we determined the Key Stakeholders of the project and grouped them by the authority and influence levels.
We also used RACI matrix to identify the areas of responsibilities of each stakeholder.

lean canvas stakeholders matrix
Picture 2 – Project stakeholders influence matrix

 

Next, we defined that the changes in the Matrix system targeted the work of the statistics and data analysis department. This is our Customer Segment – 35 people, whose main task is to provide recommendations for the road engineering based on the analysis of the statistical data.

Unfortunately, users don’t always understand the value of innovation. To get them excited about the upcoming changes, the client organized team meetings, where introduced the existing problems and presented the possible solutions. During these meetings, the most involved users were spotted – Early Adopters. They

  • find the problem really burning and have already tried to solve it with alternative methods;
  • give ideas on the system improvement;
  • are the first to test the new features;
  • their feedback is crucial in decision-making about the further system development;
  • involve the rest of the users (Early Majority) to use the new features.
lean canvas methodology adoption
Picture 3 – Technology adoption lifecycle

 

Problem. What are the problems faced by our customer segment?

The key to detecting a problem is the existing alternative/s to solve it. If no one ever has tried to solve the problem, it’s likely to be null or exaggerated, hence it’s not worth an effort to develop a solution for it.

Having analyzed the statistics department operation, we concluded that it took a person 8 days to collect, process and analyze the data, whereas the main task is to provide recommendations to enhance the situation on the roads.

The problem was identified – specialists spent too much time on manual routine activities which slowed them down and distracted from the higher priority tasks.

lean canvas business
Picture 4 – Business process

 

Unique Value Proposition

How are we uniquely going to solve our client’s problem?

In our case, the unique value proposition was to replace manual data collection and analysis taking 8 days with the streamlined automated process. It lets users upload into the system and automatically process big data flows from different types of road sensors. There are no analogs on the market.

The system allows to:

  • integrate with the road sensors control systems;
  • automatically import data instead of manual import;
  • automatically calculate analytical data instead of working with Excel sheets and formulas;
  • monitor calculated deviations to define the validity of the data obtained from the loaded road sections;
  • generate custom reports based on the obtained data.

Solution

Solution is a set of system characteristics incorporating design and functionality useful and convenient for user.

At this stage, we designed system architecture, defined possible vulnerabilities, relations between its services and risks connected with them.

If the security risk or the cost of the implementation is too high, the client can already at this point reject the solution and move on to considering other possible ways out.

To get user feedback prior to the development and to demonstrate the planned changes at the design stage, our UX designers created a functional prototype for testing.

Channels. How will we get, keep and grow our customers?

Our client always thinks in advance how to boost users interest in the new solution. He determined Channels for a target customer segment.

  1. Early Adopters. By default, this is the first distribution channel. They encourage the majority of the users to go for the new features.
  2.  Educational materials. The client created user manuals, presentations, and articles which expose the value of the new solutions for users and train them.
  3.  Live demo-sessions. This channel allows to demonstrate how the system works, explain all the features in detail, answer users’ questions.

Key Resources and Partners

Further, we defined internal and external resources required for successful solution delivery:

  • Web development team
  • Tailored communication system with all the stakeholders
  • Storage system for the project documentation
  • Task management system
  • Kanban board
  • Fault-tolerant servers’ infrastructure
  • Monitoring system for server infrastructure
  • Versions control system
  • Continuous integration server
  • Automated testing

Cost Structure

At this stage, together with the client we estimated the solution development budget and defined a profit which we can get from its deployment.

We identified the most expensive and missing resources and a possibility of replacing them with cheaper ones.

Business Value

In our story, the business value is the increase in user satisfaction. The software lets users get the tasks done much faster and with less effort than before.

Key Success Factors

Simply, these are the criteria to measure goals accomplishment.

Our goal was to provide users with a tool to relieve them from the routine manual work such as
data collection, processing, analysis and let them focus on their main task.

To measure our success, we defined and used such metrics:

  • user growth
  • number of users who still returned to old alternative approaches
  • reasons that prompted them to do that
  • number of change requests

It took us some time to elaborate a final metrics framework.

As a basis, we took Dave McClure’s AARRR – a 5-step startup metrics model and adapted it to our project needs. As a result, we got our own framework ARRMS.

lean canvas success
Picture 5 – Success metrics framework

 

Acquisition
To interest users, we always let them test a new solution. For this, we need to have a stable release on the pre-production server.

Acquisition is measured by the number of the newly attracted users, not taking into account the number of early adopters.

Reviews
To let users influence the new feature ideas, the client conducts a survey and collects their feedback on the idea. Thus, they feel that their opinions count and impact decision-making. Users tell which features they would like to get and we plan the work scope for the future releases.

Reviews are measured both by the number of the interviewees and the number of those who left their feedback.

Retention
To inform users about the progress we set up notifications about the new feature releases, email campaigns with reports on what’s done and what is planned to be done.

Retention is the number of the delivered features.

Motivation
To get users motivated about the idea, we establish a constant response to their feedback, accelerate the development and enhance the quality of the released functionality. Our client strives to minimize the number of users returning to the old work methods.

We measure motivation by the number of users prior to the release of a new feature and the number of new users after the release.

Success is the total result of our effort. We measure it by the average percent of the satisfied users from the moment of the launch and during the continuous support of the business solution.

lean canvas metrics
Picture 6 – Project’s metrics

 

To conclude

It is absolutely necessary to validate the new product/feature ideas before their realization. No point to waste your effort, time and money. If a hypothesis is already disastrous at some stage, give it up and start thinking about the new solutions.

It is great to have a change advocate on the client’s side who understands product value. Such person will always find the time to respond to the development team’s requests, will coach users and help turn a complicated system into the Swiss Army knife instead of a frankenstein product.

Due to the Lean Canvas approach, the monthly development budget of our client was reduced by 42%. Thus, the client received the budget buffer for any critical tasks.

Helpful resources to learn more about the Lean Canvas Methodology

Use the official manual that will help you to create your own Lean Canvas step by step. Here you can find the bright examples of implementing this methodology in such companies as BMW, Mercedes, and Toyota.

If you need a tool to build your Lean Canvas template, we would highly recommend Xtensio. There you can create one project for free and get extra features for a pleasant pricing.

More info regarding the metrics framework to use with lean canvas can be found in this wonderful article.

May the lean be with you!

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