Look before you code

Look before you code

Summary: CultureAmp's makers quickly found out that it isn't enough to build a product and hope that customers will see the benefit in using it; instead, the product has to meet the needs of the market.

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Over the past decade, technology workers have witnessed how the "iterate and improve" agile development methods have significantly improved the software experience. CultureAmp's founders wondered whether this thinking could revolutionise human resources.

Douglas English, Rod Hamilton, Jon Williams and Didier Elzinga were inspired to address one of the biggest complaints about workplace change programs: that corporate sentiment doesn't quickly translate to tangible benefits.

Traditional HR consultants can take up to three months to survey employees and package the results, according to co-founder English. Companies spend months converting this information into a comprehensive corporate overhaul, and then implementing this across the organisation. It often takes a year for these benefits to filter down to staff members, who are faced with new problems with their working environment.

It was like the old waterfall development framework, where technology systems are developed in long-term, one-off projects.

The founders aimed to replicate Agile's cycle of regular release, smaller features, which benefits users and developers alike, with their application Murmur. Murmur lets companies quickly understand what characteristics of the workplace engage (and alienate) employees by regularly surveying staff to assemble a real-time snapshot of employee sentiment, and a "driver analysis" explains the aspects the best engaged employees.

"Taking an idea and testing it, trying different things," English said. "What we're trying to do is make it possible for companies to take that approach with the way they go about improving their place of work."

The genesis of Murmur was when English, Hamilton and Williams worked together as contractors on the NAB technology change program. The catalyst was the co-working space Inspire9 — based in Richmond, Melbourne, and started by AngelCube investor Nathan Sampimon — where they met fellow co-worker Didier Elzinga. The team is complemented by chief scientist Jason McPherson, an organisational psychologist, who explained the real-world impact.

When they first started the business almost two years ago, it wasn't particularly successful. English and Williams believed that if they built it, customers would come (the foundation of the lean start-up dogma), but didn't give enough consideration to how they would make money.

This lesson taught them to lighten the emphasis on execution, and sharpen the focus on strategy and planning. For the most recent version of their app, they demonstrated a paper prototype to 30 CEOs months before they wrote the first lines of code. Success has come from learning to look before they code.

Now the business is profitable, and revenues are growing 50 per cent each quarter. The founders must decide whether to continue "boostrapping" the operations via profits, or whether to sell a chunk of the business to scale sales.

"We're just now starting to think about what's our next path: how much do we continue to bootstrap and when, and for what; should we consider taking investment?

"Mainly [considering] just how quickly do we want to grow? We've seen enough we know we can bootstrap ourselves, but if we took investment, we would be able to significantly accelerate the development, and the building out of actual product. Doing more of the marketing, advertising — making a bigger splash, more noise."

SWOT analysis

Strengths

The four founders have lived and breathed the problem. They arrived at a successful product through multiple iterations, and it's endorsed by its peers.

Weaknesses

Their perspective is naturally weighted toward the technical, as opposed to the human resources side.

Opportunities

Companies will want to leverage engaged workers via smartphones in order to improve working conditions.

Threats

Companies and employees will need to see tangible results, and larger HR companies could offer similar functionality.

Conclusion

The team has survived a long, challenging journey, which should have equipped them with the skills and determination to succeed.

Verdict: BOOM

Topics: Start-Ups, IT Employment

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8 comments
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  • Lean Startup ≠ Build It And They Will Come

    Hi Mahesh. Sorry, I'm not trying to be a hard-arse here, but "build it and they will come" is *not* one of the foundations of the lean startup approach. In fact, one of the most important insights that underlies the lean startup approach is "build it and they probably will not come".

    I'm probably coming to Sydney on September 5, 6 or 7 if you want to catch up for a coffee.
    snoblenet
  • Consider statements in context

    No need to apologise for your opinions Steven. I love being challenged to explain myself!

    I found this on the website of Lean Start-up godfather Eric Ries:

    "A core component of Lean Startup methodology is the build-measure-learn feedback loop." http://theleanstartup.com/principles.

    Build is the first action. That is, you "build" a MVP, so customers will "come" and use it. You test the idea and use the feedback to iterate to a more polished version.

    As I've said, "if they built it, customers would come". This is consistent with how I've seen the Lean dogma taught and practiced by nearly all entrepreneurs in Australia.

    I explained this concept in the context of CultureAmp's success to encourage people to think about when to start building.

    Success didn't come from coding on a wing and testing on a prayer. This is where the founders failed (not so fast) in the past.

    CultureAmp succeeded when they "paper prototyped" their idea with 30 CEOs - they actually aimed for 50. I've never heard of entrepreneurs performing such extensive market research and user testing before they wrote the first lines of code.

    What principle were you referring to, when you said that Lean emphasises the idea, "build it and they will probably not come?"

    Love to catch up to discuss further over coffee. Please email me at maheshsharm at gmail dot com to arrange a time and location, or to discuss this further.

    Cheers
    Mahesh
    Mahesh.sharma
    • Paper prototype = MVP

      Hi Mahesh,

      A paper prototype is an example of exactly what lean beans meant by minimum viable product!

      For example, the glossary of "The Startup Owners Manual" says "Low-fidelity MVP is the simplest minimum viable product (i.e. a landing page with a sign-up to get more information, a cardboard mockup of a physical product) used to gather feedback about the validity of a customer problem."

      To me, the approach you said that CultureAmp took once they returned to talking with customers is lean to the core. Did you ask them whether or not they define their work in those terms?

      I'll email you about catching up. Should be fun.

      Cheers,

      Steven.
      snoblenet
    • Paper prototype = MVP

      Hi Mahesh,

      A paper prototype is an example of exactly what lean beans meant by minimum viable product!

      For example, the glossary of "The Startup Owners Manual" says "Low-fidelity MVP is the simplest minimum viable product (i.e. a landing page with a sign-up to get more information, a cardboard mockup of a physical product) used to gather feedback about the validity of a customer problem."

      To me, the approach you said that CultureAmp took once they returned to talking with customers is lean to the core. Did you ask them whether or not they define their work in those terms?

      I'll email you about catching up. Should be fun.

      Cheers,

      Steven.
      snoblenet
      • A rose by any other name

        I'll check out that book, it looks like a great resource.

        While there are obviously other methods and philosophies, and i'm sure CultureAmp encountered these in its journey, I've observed the Lean start-up method advocated by Eric Ries is the one followed by most entrepreneurs. His recent tour to Australia was very popular, I heard.

        Of course there are other definitions and interpretations, but I use the one that is most widely applicable and easily understood.
        Mahesh.sharma
        • It's not Reis-vs-non-Reis

          Hi mate. I know I used a non-Reis example, but this isn't a Reis-vs-non-Reis story. I could have easily chosen an example from his book, "The Lean Startup". In there, for example, he discussed Dropbox's release of a promotional video as a MVP for a product that did not exist. In another case, some founders were testing a recipe and food ordering website. Their MVP consisted of the founders interviewing a customer in person, and then hand-delivering recipes and ingredients -- all of which occurred long before they considered building an actual website. The broader definition of an MVP -- one which I'm sure all lean beans would endorse -- is "the smallest possible thing you can build that allows you to test an assumption about your business". This might involve building a part of your product, but in the early days it often does not.
          snoblenet
          • Ries not Reis

            Slap-forehead. Sorry for the typo.
            snoblenet
  • Potato, potaato

    Stephen, this is just nit-picking over details. Please email to discuss further.
    Mahesh.sharma