PRINCE2 and Lean Startup: A principled approach

I recently gave a 7 minute no-slide lightening talk, to the Wellington PRINCE2 users group. The talk was around Eric Ries' The Lean Startup in relation to the PRINCE2 Business Case and Principles. (check out my previous Blog - Lean Startup Government presentation for more details). I was asked to blog the notes so here it is...

PRINCE2 is Business Case driven approach, with a strong emphasis on the Business Case being continuously evaluated to ensure the outcome is still desirable; is this project (still) worth investing in? But how do we ensure that the project continues to be desirable and that we are on the right track? This is how Lean Startup can help.

Lean Startup is a synthesis of:

1. Customer development: Customer centric, it asks is our solution compelling enough that the customer would want to use it today? 
2. Agile development practices: A disciplined approach to software development, that embraces evolutionary change.
3. Lean Principles: A focus on value, (as defined by the customer), reduction of waste (that is anything that does not add value to the customer) and the Flow of work.

Lean Startup is an Experiment, where you test your assumptions early and get early feedback from your customers. This is achieved through minimizing the time to iterate through a Build – Measure – Learn cycle



Fig 1: Build Measure Learn cycle by Eric Ries

Build (Manage by stages)

• Build a Minimum Viable Product (MVP).
• PRINCE2 recommends that one of the three default Business Case options is ‘Do the Bare Minimum’; this should be the next default after the ‘Do Nothing’ option 
• Undertake Rolling Wave planning  and break the project into smaller batches which can be delivered within a Workpackage
• Validate the Business Case assumptions in smaller increments using the vehicle of an MVP, through Learning and Justification

Measure (Continued business justification)

• We need a justifiable reason not just to start a project, but also to continue it 
• The Business Case Justification is based on tangible assumptions which lead to benefits (okay I’m assuming here that a benefit is made up of 1 or many assumptions!)
• We need to accept that these are just assumptions and validate them with our customers early
• To measure our assumptions they need to be objectively quantifiable
• The static Business Case becomes a living Business Model which should be continually updated as assumptions and benefits are realised (or not) and the project progresses
• For a Business Model Consider using the Lean Canvas A3 Lean Canvas by Ash Maurya based on Alex Osterwalder's Business Model Canvas
• The question moves from can the Product be built, to should the Product be built

Learn (Learn from experience)

• Experience is based on customer feedback
• Learn what the customer wants and needs (project is a learning exercise)
• Drive decision making

Manage by exception

• Project benefits are all too often reviewed for realization long after the project has closed
• The exception is what if our assumption is proved wrong? This could invalidate our expected project benefit
• We should not pursue a plan to cost and time that is based on invalidated assumptions
• We should accept the assumption is incorrect and ‘Pivot’ and lean to a new assumption and approach; or Persevere and accelerate our approach based on validated customer feedback for our assumptions
• The Project Board should steer the course of the project, set tolerance around assumptions to ensure they are validated
• Incorporate the Benefits Review as part of the process to validate assumptions based on the MVP; confirm that they can be realized before it is too late
• The Project Board should have the delegated authority to make the Pivot or Persevere decisions
• Don’t hide assumptions in a Business Case

Well that’s four of the seven PRINCE2 Principles covered

1. Continued business justification

2. Learn from experience

3. Manage by stages

4. Manage by exception

Here are some thoughts on how Lean Startup applies to the remaining three:

5. Defined Roles and Responsibilities

• Ensure you have a clear understanding of the roles
  • The ‘User’ the customer who will validate your assumptions
  • The Business to ensure that the Business Model assumptions and benefits they support are realised

6. Focus on Products

• Focus the project on the outcome of the Minimum Viable Product, rather than activities

7. Tailor to suit the project environment

• PRINCE2 is applicable to all project types, including Lean Startup