People are so excited about starting a startup project. We think it is creative and funny, and we are going to work hard and be motivated by our ideas. There is no bureaucracy, there are no rules, and you have to be fast and curious to achieve your goals and go to the next level — revenue, seed round, and customers.
But the statistics have a different representation and show that 9 of 10 projects fail. It can terrify someone, but a lot of founders choose hope and make a bet on their idea. What if to make a step back, and take a look at what the world’s experience offers to reduce this dramatic risk of failure?
Really, we have a lot of tools to reduce costs and increase our success rate in the early stage. It’s a system engineering and project management. The one thing why we care more about motivation, growth hacking, and fake-it-till-you-make-it stuff — is fun. Serious management practice looks boring.
I’m starting a series of publications about project management and system engineering approaches in startups and other kinds of projects. I believe this will help to make business ideas and products stronger from the first day. The good news is that I’ll tell the story piece by piece to show that these things are not really boring, but really powerful.
There are a lot of methodologies and approaches. However, the founders often focus on fake-till-make-it and skip a lot of fundamental stuff that has to be done anyway. Yes, the idea to make the product fast and cheap sounds attractive. “Serious” stuff can be postponed to the future, when we will have money, time, people, etc. This can be effective in experiments as part of a project strategy, but it can also become a costly trap.
In my opinion, this becomes a trap more frequently than we think. What seems cheap and fast today became a debt and expense in a few months. I watched out how it happened with others and of course, faced it by myself.
The general idea is how to apply a system engineering approach with project management practices to prepare for product development and launch. From the high-level view to valuable deliverables. That is necessary and will be required anyway, although it can confuse you because seems too complicated in the beginning. Moreover, if you make some fundamental thing at the early stage accurately, it obviously saves time and money because
- You can do it by yourself in most cases.
- You are thinking a few steps forward that reduce a lot of risks and mistakes.
System engineering covers the whole process of product creation from ideation and verification to implementation and delivery. We can talk about it as a framework for a product-oriented business. This approach allows us to get a big picture of the project and decompose it as a system, with care about each required component.
The second part of a project building, that should be used it’s, obvious — project management, especially the project management plan as described in PMBOK. Of course, for the small projects or early stages of a startup following the full methodology might be overhead and not reasonable. But you can take some artifacts partially that will fit your goals and help to answer the important questions.
For example financial model can show how much money you will need and how it has to be spent, risk assessment allows you to understand and manage actual risks, and scope management helps to avoid non-critical features in the product that will produce expensive delays. This is not all that I would like to talk about, but the idea is to build every project based on strong fundamentals instead of pure feelings and empirical estimations.
One more thing why it matters — you can operate these parts as deliverables of your project execution and assemble your business piece by piece. It is very useful because it became possible to create a kind of map of the projects with the parts that have to be filled and created. And it’s easy to split the whole roadmap by milestones with clear results. Finally, all this “boring” stuff helps us turn our technology, app, service, or even art into a product and then, into business.
In the few next publications, I’ll talk about the importance of working with stakeholders’ needs and why it is the beginning of each project, and why a financial model is one of the core elements and most important artifacts not only for serious series A but since a pre-seed stage.