BONUS: Barry O’Reilly on What is Hypothesis-driven Development, and why that matters for Agilists

EXTRA BONUS: to get 30% off Barry’s Hypothesis-Driven Development course you can go to www.leanagile.study  and use discount code THIRTYCPOFF before the end of December 2017.

Far too many companies act as if Product Development was a shopping trip: they get a list of things to “buy”, typically Features. Then they create documents explaining that shopping list: Roadmaps, Backlogs, PowerPoint presentations, Post-its on walls, you name it. And then they execute. Here’s the thing: if you act as if Product Development is a shopping trip all you will do is spend a lot of money and get lots of Features you don’t really need.

Barry suggests we treat Product Development differently. He calls it Hypothesis-Driven Development (HDD for short) and includes:

  1. Leadership set an outcome (not a task!) Example: how to increase conversion by 10%
  2. Look for observations: where you try to understand what is happening in the product and to the product you develop.
  3. Set a hypothesis to validate ideas: where you make assumptions and write those down as assumptions. Assumptions should be about how to reach the goal set in step 1.
  4. Create simple experiments: actions that drive results, which you will compare with the hypothesis you created in 3.
  5. Gather the data, learn and repeat: the core process is LEARNING. Therefore, spend enough time on this step so that you generate new observations, insights. Then repeat the cycle.

A fundamental shift in product development

Barry claims that HDD is a fundamental shift in product development. The shift is from doing many things, many small changes, and switches to focusing on outcomes, on results to the business. This means that leadership is no longer accountable for the work, but for the outcomes. And this frees the teams to focus on self-organizing to reach those outcomes, instead of following a list of things that others have dictated.

We go from investing in work to investing in learning. We might use Innovation Accounting, à lá #LeanStartup, or focus on creating Options and benefit from the concept of Optionality popularized by Nassim Taleb in his famous Black Swan book, but also referred to in Commitment, the book by Agile Coaches Chris Matts and Olav Maassen. This different focus will completely change your product development process to maximize the information generated and help you find new avenues for growth in your product.

We don’t do Projects anymore, we run Experiments!

As a result of the shift towards HDD, we stop focusing on big-bang, all-in projects and focus on running smaller experiments that drive the learning that will eventually generate the outcomes we defined. As Barry says in this episode: we go from 1 to 2 experiments per year (projects) to testing many more ideas every month.

But you can’t run that many experiments with the same approach to funding, and management that you used when you ran projects. So we focus on a different management paradigm that Barry explains further. The goal: learn and adapt faster, not produce more features.

As part of that, we need to get familiar with the concept of safe-to-fail experiments that can reliably generate knowledge without causing chaos or confusion in our product development process.

And it all starts with a simple change in product development: define the problem you are trying to fix, not the solution you are trying to create.

If I want to know more about the Hypothesis-Driven Development approach, where should I start?

 

If you want to generate options you may try Teresa Torres ‘Opportunity Tree’ which is a great tool for generating experiment options to test hypotheses https://www.producttalk.org/2016/08/opportunity-solution-tree/

 

About Barry O’Reilly

Barry O’Reilly is a business advisor, entrepreneur, and author who has pioneered the intersection of business model innovation, product development, organizational design, and culture transformation.

Barry works with business leaders and teams from global organizations that seek to invent the future, not fear it. Every day, Barry works with many of the world’s leading companies to break the vicious cycles that spiral businesses toward death by enabling experimentation and learning to unlock the insights required for better decision making and higher performance and results.

Barry is the co-author of the international bestseller Lean Enterprise: How High-Performance Organizations Innovate at Scale—included in the Eric Ries Lean series, and a Harvard Business Review must-read for CEOs and business leaders.

You can link with Barry O’Reilly on LinkedIn and connect with Barry O’Reilly on Twitter.

You can also contact Barry O’Reilly through his site, and sign up for his newsletter to get the latest news about Hypothesis-Driven Development.

EXTRA BONUS: to get 30% off Barry’s course you can go to www.leanagile.study  and use discount code THIRTYCPOFF before the end of December.