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Posted by on Oct 22, 2012 in Food For Thought | 1 comment

6 Steps To Apply Natural Selection To Give Your Customers Value

6 Steps To Apply Natural Selection To Give Your Customers Value

I first learned about the theory of evolution when I was a psychology student at university. I took a class on motivation with a professor who was a die-hard believer in the theory, particularly on its effect on our motivations (naturally). Charles Darwin introduced the theory of evolution to the world with his book On the Origin of Species. An essential part of the theory was the idea of natural selection, which is commonly referred to as “survival of the fittest”. Before I go on, I am aware that the theory is controversial, but its irrelevant to this article whether you agree or disagree with it. So hold back your punches and bear with me.

Briefly, the theory of natural selection proposes that members of a species or population have mutations over time. If the members with the mutations adapt to their environment better, they are more likely to survive, reproduce and pass it on to their offspring. Over time, this mutation becomes “standard option” since the members with it will out-survive others in the population. As this process happens repetitively over time, the species evolves and adapts to its environment better (this is called “selective adaptation”). So if we take rabbits as an example (no rabbits were harmed in the making of this blog): The rabbits that developed a strong sense of hearing were able to hear predators approaching earlier and were able to avoid them better than other rabbits. Over time, the rabbits with better hearing survived and reproduced while their hard-hearing cousins ended up as someone’s lunch. So strong hearing became a “standard option” for rabbits.

So what does this have to do with business? I read an interesting book recently called “The Lean Startup“. The writer proposes running startups by using a process similar to Toyota’s Production System. Briefly, the lean method proposes that you should apply your resources (time, money, people, attention, etc) only on things that deliver value to the customer. Anything that doesn’t deliver value should be eliminated.

So, the way I see it both theories are proposing the same thing.

On one hand, Natural Selection says:
Species + “good” mutations in traits = adaptation & survival as a species

On the other hand, the Lean Method says:
Companies + “good” use of resources = value to customers & survival as an entity

Hey, you can get excited about this and apply it to yourself as an employee:
Employee + “good” application of self = value to company and survival/growth in company

So if it worked well for our species, we can make it work for our work and companies. Here are six steps to apply this to our work (be it a startup or an existing company):

1- Launch with something that delivers the bare minimum of what customers want. Avoid the temptation to add extra stuff (e.g. features) you assume customers want.

2- List the items you think will add value to customers (new features, design, price, promotion, etc). Prioritize them based on how much value they will add to customers.

3- Experiment: Behave like a scientist (lab coat optional) and treat each of these items as a hypothesis (i.e. feature X will give value to customer). Add each of these items to your product, starting with the highest priority and working your way down the list.

4- Measure: Set how you will measure “success” for your mini-experiments. This will depend on what you do, but you can track the number of customers, registrations, purchases, renewals, etc. Make sure you are measuring the same thing for all experiments. Oh and while you’re at it, make sure you measure the change in these metrics after each experiment rather than looking at the totals. Tracking the total will dilute the experiment with everything else you have done before.

5- Adapt: After each experiment, eliminate what doesn’t add value and adopt what does. Let go of emotional attachments to pet products/features and only keep what your customers actually want.

6- Rinse and repeat from step 2. If you rinse & repeat too many times (say 10+ times) and still get flat results, then it’s time to make a big change in direction (i.e. go back to step 1).

The advantages of doing it this way are:
– You can start fast(er) and do it cheap(er)
– You will build a relationship with your customers and get feedback from them sooner
– You will keep your house clean since you will be dropping the stuff that doesn’t work
– You will reduce waste of resources building what you assume/project customers want
– You learn more and quicker what your customers want, which means you will adapt better

Share Your Thoughts: Are you ready to cheat from Darwin and apply natural selection to your work? Try it out with a startup, your work, or anywhere in your like. Let us how it goes.

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