A Common MVP Evolution: Service to System Integration to Product (2017)

A common evolution for a startup’s offering is service to system integration to product. Here is an explanation for the reasons and benefits.

A Common MVP Evolution: Service to System Integration to Product

One common approach we see is for bootstrapping teams that have a basic understanding of customer needs to start by offering a service. Once they get uptake on their service offers, they start to take advantage of existing solutions prospects are using to create a “system integration” or extension offering. For example, if your goal is to replace Excel where it’s being used for a particular purpose, first offer an Excel template. This is more compatible with current practice, easier for prospects to trial, and easier to iterate on than a fully coded solution. Once they get uptake on the system integration offer, they can start to offer a product. We normally see the progression as:

1. Service: normally wrapped around or leveraging an internal technology that is the core of the contemplated product offering.
2. System integration: that combines one to three existing solution elements.
3. Product: that may benefit from related services and that often still interoperates with existing solutions based on what you learned during phase 2.

Starting with a service goes by various names:

• Mechanical Turk (replace software and hardware with people for maximum flexibility)
• Wizard of Oz (pay no attention to the man behind the curtain).
• Flintstoning (from Fred Flintstone’s feet powered his “car”).
• The Concierge method

Service First

By starting with a service, you can refine and adjust your offering with each customer, trying different approaches in parallel while engaging in ongoing discovery. Your ability to improvise enables you to continuously deliver “new features,” and contemporaneous conversations allow for continuous discovery. Keys to success:

• Continual improvements to your ability diagnose customer needs and constraints.
• Refinement of explicit checklists for engagement and internal processes.
• Systematic substitution of software for labor as processes stabilize to enable lower cost and faster cycle time.

Add System Integration

In addition to adding software to your service process, embrace tools that the customer is already using and interoperate with them. This allows you to come to a clearer understanding of the strengths and gaps in the current workflow. There is no point in duplicating the functionality of existing tools the customer is already using; find ways to extend them to add value and increase your differentiation.

Typical offerings in the phase may include:

• Templates or configurations that extend their existing system (Excel/Word templates, simple forms).
• Simple add-on tools that leverage APIs or established file formats. If these can be bidirectional, the customer is more likely to invest effort because their data won’t be trapped in your system.

Offer a Stand-Alone Product

With phases one and two complete and customers willing to pay you for the value you have delivered, you have a much deeper understanding of their needs and are much better prepared to offer them an upgrade path to a full product offering.

The Key Benefit: You Can Focus on Value Immediately

Normally you face two key risks:

• Desirability: Will customers pay for your product? With a service, you can make a bona fide offer and negotiate an agreement immediately.
• Feasibility: Can you make the product work? Service first reduces this to: can you make the technology work well enough that it makes you more productive delivering results.

“Without writing any code, the team learned what they needed. MVPs often don’t need code, but teams forget this. Our organizations are so used to solving every problem with software that we forget that we can learn what we need by faster, more effective means.” — Jared Spool