Description
My purpose in writing The Four-Way Fit is to advance the science of innovation-- in ways both practical and actionable; for entrepreneurs and business leaders; at every stage of company-building.
For the past fifteen years, innovation theory and practice have been dominated by the Lean Startup Model. This innovation era was first ushered in by Steve Blank, with the publication of Four Steps to the Epiphany in 2005. Eric Ries built on Blank's seminal work in his 2011 book The Lean Startup. These two luminaries are the grandfathers of the lean startup movement, which has transformed innovation worldwide. Phrases like "minimum viable product", "agile development" and "build / measure / learn" are rooted in their work. Companies in all corners of the globe are today more customer-centric, more scientific, more incremental, and more agile-- directly because of their work.
But still, today we are in need of a new and better innovation model. Fully half of all small businesses launched in the US this year will be gone in 5 years. Half of the companies on the S&P 500 list today will not be on the list in 10 years. For all the good the lean startup model has brought us, time and experience have taught us its gaps. Over the past fifteen years, we have come to learn that to traverse the journey from early-stage startup to iconic global enterprise, lean thinking is certainly key-- but it is not sufficient.
The path to greatness begins with an initial value breakthrough, achieved in a large market. Great companies then go on to perfect and extend that value, while simultaneously building pathways to sustainable competitive advantage. This requires work in four domains: Market, Product, Model and Team. At every stage of company-building, they figure out what it takes inside these domains to move on to the next stage-- and then they execute. Through the embrace of design thinking, lean thinking, strategic thinking and systems thinking, they methodically build up, sustain and extend customer-defined value.
It all requires more than just product / market fit. It takes a Four-Way Fit-- found at the juncture of Market, Product, Model and Team.
To find this fit, you need a framework and a method. The Four-Way Fit framework helps you to clarify the domains and subdomains that matter most in charting the innovation path. Within them, you can then differentiate between those assumptions you are confident are true, and are therefore immediately actionable; versus those that require testing and verification before investment and action. The difference between these two types of assumptions is important; understanding it helps you avoid waste of money and time.
The job of the method is to help you march from your current stage to the next with efficiency and effect. It helps you strike the right balance between planning steps and action steps. It clarifies what to do if a key assumption proves flawed. It helps you test, iterate and optimize, so you can narrow in on truth, reach the next value inflection point and by so doing reach the next stage.
The Four-Way Fit is organized into three parts. Part One addresses the framework. Part Two addresses the method. And Part Three addresses the unique requirements presented by each company-building stage.