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70-424: The highly competitive program features an acceptance rate in the single digits. In the inaugural round in the summer of 2012, over 700 applicants competed for 18 fellowships. The second class included 43 fellows selected from over 2000 applicants. The third round consisted of 27 fellows selected from over 1500 applicants. The Presidential Innovation Fellows program and the fellows themselves are commonly referred to by

140-414: A billion dollar business based on the model of selling shoes online. Continuous deployment, similar to continuous delivery , is a process "whereby all code that is written for an application is immediately deployed into production," which results in a reduction of cycle times . Ries stated that some of the companies he's worked with deploy new code into production as often as 50 times a day. The phrase

210-503: A broader community of interested citizens throughout the country. What makes this initiative unique is its focus on unleashing the ingenuity and know-how of Americans from all sectors. Originally hiring in groups of "classes" or "rounds," in 2015 the Presidential Innovation Fellows program was updated to rolling recruitment to better fit the timing needs of agencies and administration priorities. According to

280-420: A group of users one week may see one version of the product while the next week users see another. This undermines the statistical validity of the results, since external events may influence user behavior in one time period but not the other. For example, a split test of two ice cream flavors performed in serial during the summer and winter would see a marked decrease in demand during the winter where that decrease

350-408: A new business, it is important to start with the end in mind, which means thinking about the direction in which you want your business to grow and how to put all the right pieces in place to make this possible. Similar to the precepts of lean manufacturing and lean software development , the lean startup methodology seeks to eliminate wasteful practices and increase value-producing practices during

420-556: A predetermined budget instead of a goal of raising revenue. It was published in 2016. Earlier publications by Osterwalder and colleagues had suggested how to adapt the Business Model Canvas for nonprofit enterprises that depend on raising revenue. "Mission budget/cost" and "mission achievement/impact factors" blocks replace the "cost structure" and "revenue streams" blocks in the Business Model Canvas, while "beneficiaries", "buy-in/support" and "deployment" blocks replace

490-514: A shortlist of administration priorities that it actively pursues." Like the PIF program and 18F, one of the strategic aims is to "bring best-of-class, private-sector engineers into government for time-limited tours of duty," and task them with bringing a modern perspective to key technology initiatives. Similar to 18F, many PIF alumni have stayed on to help staff the USDS. In terms of extreme selectiveness,

560-434: A unique value proposition. "Problem" and "solution" blocks replace the "key partners" and "key activities" blocks in the Business Model Canvas, while "key metrics" and "unfair advantage" blocks replace the "key resources" and "customer relationships" blocks, respectively. The Value Proposition Canvas is a supplement to the Business Model Canvas ("customer segment" and "value proposition" blocks) published in 2012 to address

630-425: A vanity metric is "the number of new users gained per day". While a high number of users gained per day seems beneficial to any company, if the cost of acquiring each user through expensive advertising campaigns is significantly higher than the revenue gained per user, then gaining more users could quickly lead to bankruptcy. A pivot is a "structured course correction designed to test a new fundamental hypothesis about

700-463: A webpage that explained the program in the following terms: The Presidential Innovation Fellows program pairs top innovators from the private sector, non-profits, and academia with top innovators in government to collaborate on solutions that aim to deliver significant results in six months. Each team of innovators works together in-person in Washington, DC on focused sprints while being supported by

770-399: Is a learning cycle of turning ideas into products, measuring customers' reactions and behaviors against built products, and then deciding whether to persevere or pivot the idea; this process repeats as many times as necessary. The process can also be viewed as a test of hypotheses. The phases of the loop are: Ideas → Build → Product → Measure → Data → Learn . The Business Model Canvas

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840-523: Is a methodology for developing businesses and products that aims to shorten product development cycles and rapidly discover if a proposed business model is viable; this is achieved by adopting a combination of business- hypothesis -driven experimentation, iterative product releases, and validated learning . Lean startup emphasizes customer feedback over intuition and flexibility over planning. This methodology enables recovery from failures more often than traditional ways of product development. Central to

910-529: Is a strategic management template invented by Alexander Osterwalder around 2008 for developing new business models or documenting existing ones. It is a visual chart with elements describing a firm's value proposition , infrastructure, customers, and finances. It assists firms in aligning their activities by illustrating potential trade-offs. The template consists of nine blocks: activities, partners, resources, value proposition, customers, customer channels, customer relationships, costs and revenue. Startups use

980-617: Is designed to provide senior level federal employees (GS-15 and equivalent) with exposure to cross-agency priority challenges. It was established by President Barack Obama on December 9, 2014. The program is sponsored by the Executive Office of the President and is administered by the General Services Administration . In the same year that the Presidential Innovation Fellows program was founded,

1050-424: Is done primarily through two processes: using key performance indicators and a continuous deployment process. When a startup company cannot afford to have its entire investment depend upon the success of a single product or service, the lean startup methodology proposes that by releasing a minimum viable product that is not yet finalized, the company can then make use of customer feedback to help further tailor

1120-402: Is mostly related to the weather and not to the flavor offer. Another way to incorrectly A/B test is to assign users to one or another A/B version of the product using any non-random method. Actionable metrics can lead to informed business decisions and subsequent action. These are in contrast to vanity metrics—measurements that give "the rosiest picture possible" but do not accurately reflect

1190-433: Is the "version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort" (similar to a pilot experiment ). The goal of an MVP is to test fundamental business hypotheses (or leap-of-faith assumptions) and to help entrepreneurs begin the learning process as quickly as possible. As an example, Ries noted that Zappos founder Nick Swinmurn wanted to test

1260-611: Is the co-founder and executive chairman of Devoted Health. Park was born in 1973 in Salt Lake City, Utah to South Korean immigrant parents. He graduated from the Columbus Academy in 1990. In that year he was named a Presidential Scholar . He attended Harvard as an economics major where he met his future wife, Amy, with whom he has two children. He graduated magna cum laude and a Phi Beta Kappa . Park co-founded athenahealth with Jonathan S. Bush in 1997 at

1330-896: The Chicago and New York City Lean Startup Meetups attracting over 4,000 members each. The Lean Startup Machine created a new spin on the lean startup meetups by having attendees start a new company in three days. As of 2012, the Lean Startup Machine claimed to have created over 600 new startups this way. Prominent high-tech companies have begun to publicly employ the lean startup methodology, including Intuit , Dropbox , Wealthfront , Votizen , Aardvark , and Grockit . The lean startup principles are also taught in classes at Harvard Business School and UC Berkeley and are implemented in municipal governments through Code for America . Academic researchers in Finland have applied

1400-998: The "customer segments", "customer relationships" and "channels" blocks, respectively. Ries and others created an annual technology conference called Startup Lessons Learned which has subsequently changed its name to the Lean Startup Conference. Lean startup meetups in cities around the world have garnered 20,000 regular participants. The first lean startup meetup named Lean Startup Circle was created by Rich Collins on June 26, 2009 hosting speaking events, workshops, and roundtable discussions. As of 2012, there are lean startup meetups in over 100 cities and 17 countries as well as an online discussion forum with over 5500 members. Third-party organizers have led lean startup meetups in San Francisco , Chicago , Boston , Austin , Beijing , Dublin , and Rio de Janeiro , among others—many of which are personally attended by Ries—with

1470-480: The Department of Health and Human Services created its HHS Entrepreneurs program (originally known as HHS Innovation Fellows), which is different in structure and focus, but also aims to incorporate external ideas and expertise into HHS's own innovation processes. On August 20, 2015, President Barack Obama issued an executive order institutionalizing the Presidential Innovation Fellows program as an ongoing part of

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1540-514: The Nation's biggest challenges and to achieve a profound and lasting social impact; providing a conduit for nongovernmental support of the PIF program and its mission; and serving as an alumni association for PIF fellows, providing an avenue for PIF fellows and their networks to continue contributing to solving challenges of national concern. Some alumni of the program have gone on to other innovation roles, primarily in technology-related areas, in both

1610-596: The National Weather Service, which feeds data to commercial weather sites and applications. He also described his desire to create a "holy cow machine for healthcare" that shows waste. He was an advocate for applying open innovation and the Lean Startup approach to government initiatives. Under Park, HHS applied open innovation—sometimes called crowdsourcing —to leverage the distributed intelligence of people outside of government. According to

1680-602: The New York Times, Park believes that releasing health data through HealthData.gov will support the agency's public health goals and catalyze new business opportunities in mhealth and eHealth . In 2010, Fast Company magazine named him one of the 100 Most Innovative People in Business. Park ran his team inside of the massive government agency "like a Silicon Valley company," according to the Atlantic. That approach

1750-560: The President. After assuming this role, Park worked with a variety of agencies across the federal government to replicate the Datapalooza in their respective domains. Inspired by Code for America , Park also started the Presidential Innovation Fellows program, designed to bring top innovators from outside government for focused "tours of duty" with federal innovators on game-changing projects. The idea of

1820-573: The Presidential Innovation Fellows program is similar to the White House Fellows program. In addition, both are non-partisan programs. However, the White House Fellows program is focused on preparing future national leaders using special assistant roles to top-ranking government officials. In contrast, the Presidential Innovation Fellows are tasked with leading highly accelerated tactical and technical projects, with many of

1890-671: The Sankalp Award for the "most innovative and promising health-oriented social enterprise in India. In 2017, Park founded Devoted Health, where he serves as co-founder and executive chairman. In 2009, he was approached by Bill Corr to be the Chief Technology Officer of the Department of Health and Human Services . At HHS, he was a leader in bringing the notion of "big data" to healthcare. He expressed his ambition to create an open health data platform analogous to

1960-482: The U.S. Federal Government. “What began as an experiment is becoming a success. That’s why I’m making it permanent. From now on, Presidential Innovation Fellows will be an integral part of our government.” In 2017, the bipartisan TALENT Act introduced by Kevin McCarthy was passed by Congress, making permanent the PIF program. The Presidential Innovation Fellows Foundation, a non-government non-profit organization,

2030-579: The White House Office of Science and Technology Policy . When the extent of the problems with Healthcare.gov became clear, Park was tasked by President Obama to work on a "trauma team" that addressed the "technological disaster". Park, along with Jeffrey Zients , led the "tech surge" that ultimately repaired Healthcare.gov over the winter, eventually fixing the marketplace sufficiently to enable millions of Americans to find plans and purchase health insurance. Lean Startup Lean startup

2100-471: The White House blog, Farmer wrote, “The first five missions include creating common-sense tools for public participation, liberating government data to fuel job growth, giving everyone secure access to their own health information, streamlining the government contracting process for high-growth startups, and getting more bang for our foreign aid buck.” Those interested in the program were invited to visit

2170-447: The White House, "Applications will be accepted throughout the year...[T]hey will be reviewed in the order they are received and candidates will be accepted on a rolling basis." 18F , the digital agency of the General Services Administration , grew out of the Presidential Innovation Fellows program in 2014, originally consisting of nearly two dozen Presidential Innovation Fellow alumni. As PIF alum Ben Balter has noted, "the PIF program

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2240-581: The age of 24. In 2008 he co-founded Castlight Health , named by the Wall Street Journal as the #1 venture-backed company in America for 2011. Park also served as a volunteer senior advisor to Ashoka , a global incubator of social entrepreneurs, where he helped start a venture called Healthpoint Services, which brings affordable clean water, drugs, diagnostics, and telehealth services to rural villages in India. In 2011, Healthpoint Services won

2310-428: The application of lean manufacturing principles to startups is highly problematic and only creates incremental outcomes for startups that use the method. Other scholars, including Wharton's Dan Levinthal, argue that many of the insights of lean startup have already been anticipated by the technology evolution, organizational learning and other literatures. The value of lean startup continues to be debated and discussed in

2380-513: The customer–product relationship, the perceived value of the product or service, and potential product/market fit . The "value proposition" block is divided into three categories—products and services, gain creators, and pain relievers—that correspond to three categories in the "customer segment" block—customer jobs, gains, and pains. The Mission Model Canvas is a version of the Business Model Canvas developed by Alexander Osterwalder and Steve Blank for entities such as government agencies that have

2450-410: The earliest phases of a company so that the company can have a better chance of success without requiring large amounts of outside funding, elaborate business plans, or a perfect product. Customer feedback during the development of products or services is integral to the lean startup process, and ensures that the company does not invest time designing features or services that consumers do not want. This

2520-575: The end customer as waste, and they continually seek ways to eliminate such waste. In particular, such systems focus on: Lean manufacturing was later applied to software as lean software development . The lean startup methodology is based on the customer development methodology of Silicon Valley serial entrepreneur-turned-academic Steve Blank . In his book The Four Steps to the Epiphany: Successful Strategies for Products that Win (2005, 5th edition 2013), Blank pointed out

2590-609: The event, renamed the Health Datapalooza , grew to over 2000 attendees, receives coverage from technology blogs, and has participation from venture capitalists, physicians and politicians from both sides of the aisle, providing an example of a way that government can engage with the private sector. In March 2012, President Obama appointed Todd Park to replace Aneesh Chopra as the United States Chief Technology Officer and Assistant to

2660-472: The executive champion for the program and Farmer as its founding director. Around the time of its founding, Park said the new program "will bring top innovators from outside government for focused "tours of duty" with our best federal innovators on game-changing projects. Combining the know-how of citizen change agents and government change agents in small, agile teams that move at high speed, these projects aim to deliver significant results within six months." On

2730-549: The founders realized that their idea was significant, and had successfully empowered people to coordinate group action. Three years later, Groupon would grow into a billion dollar business. Steve Blank defines a pivot as "changing (or even firing) the plan instead of the executive (the sales exec, marketing or even the CEO)." This topic focuses on how entrepreneurs can maintain accountability and maximize outcomes by measuring progress, planning milestones, and prioritizing. The topic

2800-436: The highly political world in which it operates on a daily basis." The United States Digital Service , or USDS, launched in 2014 and provides consultation services to federal agencies on large-scale information technology projects. USDS seeks to simplify and improve federal websites and other digital service delivery tools. As PIF alum Ben Balter has noted, "unlike 18F , which is approached by agencies asking for help, USDS has

2870-445: The hypothesis that customers were ready and willing to buy shoes online. Instead of building a website and a large database of footwear, Swinmurn approached local shoe stores, took pictures of their inventory, posted the pictures online, bought the shoes from the stores at full price after he'd made a sale, and then shipped them directly to customers. Swinmurn deduced that customer demand was present, and Zappos would eventually grow into

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2940-587: The implementation of the healthcare reform implementation progress. HealthCare.gov was also the first website ever "demoed" by a sitting president The following two versions, from the relaunch of the front end in May 2013 to the badly flawed marketplace that went live in October 2013, were developed by contractors and overseen by officials at the Centers for Medicare and Medicaid Services , outside of his purview within

3010-432: The initial early adopters . Ries claimed that despite the many proximate causes for failure, the most important mistake was that the company's "vision was almost too concrete", making it impossible to see that their product did not accurately represent consumer demand. Although the lost money differed by orders of magnitude, Ries concluded that the failures of There, Inc. and Catalyst Recruiting shared similar origins: "it

3080-481: The key drivers of a business. Vanity metrics for one company may be actionable metrics for another. For example, a company specializing in creating web based dashboards for financial markets might view the number of web page views per person as a vanity metric as their revenue is not based on number of page views. However, an online magazine with advertising would view web page views as a key metric as page views are directly correlated to revenue. A typical example of

3150-498: The latter of which focuses primarily on recruiting recent graduates as citizen-scholars as a pathway to long-term Federal careers. Presidential Management Fellows are administered via the U.S. Office of Personnel Management . The Presidential Management Fellows Program was initially established as the Presidential Management Intern Program in 1977. The White House Leadership Development Program

3220-447: The lean startup methodology also drew inspiration from the work of people like Ian C. MacMillan and Rita Gunther McGrath who developed a technique called discovery-driven planning , which was an attempt to bring an entrepreneurial mindset to planning. In his blog and book The Lean Startup , entrepreneur Eric Ries used specific terms to refer to the core lean startup principles, as described below. A minimum viable product (MVP)

3290-399: The lean startup methodology is the assumption that when startup companies invest their time into iteratively building products or services to meet the needs of early customers, the company can reduce market risks and sidestep the need for large amounts of initial project funding and expensive product launches and financial failures. While the events leading up to the launch can make or break

3360-513: The lean startup methodology to accelerating research innovation. The United States Government has employed lean startup ideas. The Federal Chief Information Officer of the United States , Steven VanRoekel noted in 2012 that he was taking a "lean-startup approach to government". Ries has worked with the former and current Chief Technology Officers of the United States — Aneesh Chopra and Todd Park respectively—to implement aspects of

3430-514: The lean startup methodology. Ben Horowitz , the co-founder of venture capital firm Andreessen Horowitz , wrote an article in 2010 criticizing the lean startup method for over-emphasizing "running lean" (constantly cutting and reducing non-essential parts of the company to save time and money). He specifically disagreed with portraying "running lean" as an end rather than a means to winning the market without running out of cash. Horowitz gave as an example his startup Loudcloud , which by "running fat"

3500-862: The lean startup model. In particular, Park noted that in order to understand customer demand, the Department of Health and Human Services recognized "the need to rapidly prototype solutions, engage customers in those solutions as soon as possible, and then quickly and repeatedly iterate those solutions based on working with customers". In May 2012, Ries and The White House announced the Presidential Innovation Fellows program, which brings together top citizen innovators and government officials to work on high-level projects and deliver measurable results in six months. Steve Blank , working with retired United States Army colonel Pete Newell and former United States Army Special Forces colonel Joe Felter, adapted lean startup principles for U.S. government innovation under

3570-441: The method comes out of a 2011 analysis of the factors of success in growth companies as described in the 2011 book Great by Choice . Lean startup has also been the source of attention in the academic literature. For example, Stanford professor Riitta Katila finds empirical support for lean startup. However, a group of prominent strategy and innovation scholars—Teppo Felin, Alfonso Gambardella, Scott Stern and Todd Zenger—argue that

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3640-810: The moniker "Hacking for Defense", a program in which university students solve problems that the Department of Defense , the United States Armed Forces , and the United States Intelligence Community submit to participating universities. Hacking for Defense and variants like Hacking for Diplomacy have expanded to the United States Department of State , Department of Energy , NASA , and nonprofits. Lean startup principles have been applied to specific competencies within typical startups and larger organizations: The lean startup methodology

3710-492: The pitfalls of a narrow emphasis on product development; instead he argued that startups should focus on what he called "customer development", which emphasizes "learning about customers and their problems as early in the development process as possible". Blank's customer development methodology proposed four steps: In an article published in the Harvard Business Review in 2013, Steve Blank described how

3780-470: The private sector as well as in public sector roles at federal, state and local levels, as well as advisory roles such as sharing scientific and technical expertise at President's Council of Advisors on Science and Technology (PCAST) workshops. Todd Park Todd Park is a Korean American entrepreneur and government executive. He served as Chief Technology Officer of the United States and technology advisor for U.S. President Barack Obama . He

3850-420: The product or service to the specific needs of its customers. The lean startup methodology asserts that "lean has nothing to do with how much money a company raises"; rather it has everything to do with assessing the specific demands of consumers and how to meet that demand using the least amount of resources possible. Use of the word lean to describe the streamlined production system of lean manufacturing

3920-407: The product, strategy, and engine of growth." A notable example of a company employing the pivot is Groupon ; when the company first started, it was an online activism platform called The Point. After receiving almost no traction, the founders opened a WordPress blog and launched their first coupon promotion for a pizzeria located in their building lobby. Although they only received 20 redemptions,

3990-496: The program is to combine the experience of citizen change agents and government change agents to tackle specific challenges at high speed, delivering significant results within six months. The initial version of HealthCare.gov, which was deployed on July 1, 2010, was built in 90 days by Park and his team at HHS. The first HealthCare.gov was cited by the Kaiser Family Foundation as one of the early highlights in

4060-586: The projects rapidly delivering new functioning systems, processes, and software applications using principles derived from Lean Startup methodology. Organizationally, White House Fellows are presidential appointees administered through the White House Office . The program established by President Lyndon Johnson in 1964. The PIF program is distinct and separate from the Presidential Management Fellows Program ,

4130-610: The shorthand “PIF” (pronounced “Pif”). In 2015, President Barack Obama issued an Executive Order making the Presidential Innovation Fellows program a permanent part of the U.S. federal government. The Presidential Innovation Fellows program was founded by former U.S. Chief Technology Officer Todd Park , former U.S. Chief Information Officer Steven VanRoekel , former Department of Veterans Affairs Chief Technology Officer and White House Fellowship alumnus Peter L. Levin, and former White House Office of Science and Technology Policy Senior Advisor for Innovation John Paul Farmer. Park served as

4200-407: The template (and/or other templates described below) to formulate hypotheses and change their business model based on the success or failure of tested hypotheses. The Lean Canvas is a version of the Business Model Canvas adapted by Ash Maurya in 2010 specifically for startups. The Lean Canvas focuses on addressing broad customer problems and solutions and delivering them to customer segments through

4270-477: The wants of their target customers, and because they focused too much time and energy on the initial product launch. Next, Ries was a senior software engineer with There, Inc., which Ries described as a classic example of a Silicon Valley startup with five years of stealth R&D , $ 40 million in financing, and nearly 200 employees at the time of product launch. In 2003, There, Inc. launched its product, There.com , but they were unable to garner popularity beyond

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4340-546: Was a success, and soon after a group called 18F was created within the General Services Administration (GSA) not only to house the PIFs, both physically and bureaucratically, but also to continue and augment their efforts — to centralize forward-thinking technologists in government under one administrative umbrella, and to provide a vehicle for change that wasn’t tied so closely to the administration and

4410-537: Was able to outperform 20 direct competitors and after 8 years reach a value of $ 1.6 billion. However, at least since 2008, numerous advocates of lean methods have pointed out that "running lean" does not mean cost cutting . Trey Griffith, the VP of technology at Teleborder, stated in 2012 that the majority of backing for the lean startup methodology was anecdotal and had not been rigorously validated when first presented. However, he went on to note that better support of

4480-442: Was coined by Timothy Fitz, one of Ries's colleagues and an early engineer at IMVU . A split or A/B test is an experiment in which "different versions of a product are offered to customers at the same time." The goal of a split test is to observe differences in behavior between the two groups and to measure the impact of each version on an actionable metric. A/B testing is sometimes incorrectly performed in serial fashion, where

4550-657: Was first proposed in 2008 by Eric Ries , using his personal experiences adapting lean management and customer development principles to high-tech startup companies . The methodology has since been expanded to apply to any individual, team, or company looking to develop new products, services, or systems without unlimited resources. The lean startup's reputation is due in part to the success of Ries' bestselling book, The Lean Startup , published in September 2011. Ries' said that his first company, Catalyst Recruiting, failed because he and his colleagues did not understand

4620-436: Was formally incorporated in 2014. It exists to serve as an alumni group for all former Presidential Innovation Fellows (PIF) and to serve as the fiduciary agent for non-governmental contributions for the support of the PIF program. The purposes include: furthering the mission of the Presidential Innovation Fellows program of bringing the principles, values, and practices of the innovation economy into government in order to tackle

4690-445: Was later expanded upon to include three levels of innovation accounting related to the types of assumptions being validated. The Build–Measure–Learn loop emphasizes speed as a critical ingredient to customer development. A team or company's effectiveness is determined by its ability to ideate, quickly build a minimum viable product of that idea, measure its effectiveness in the market, and learn from that experiment. In other words, it

4760-536: Was particularly relevant in the development of HealthCare.gov , the first government website that provides consumers with a searchable database of public and private health insurance plans available across the U.S. by zip code. At HHS, Park also launched the Community Health Data Initiative, a developer conference and showcase to encourage the development of innovative healthcare applications using open government data. By its fourth year,

4830-504: Was popularized by the 1990 book The Machine That Changed the World . The Toyota Production System pioneered by Taiichi Ohno combined flow principles that had been used by Henry Ford since the early 1900s with innovations such as the TWI programs introduced to Japan in 1951. Lean manufacturing systems consider the expenditure of resources for any goal other than the creation of value for

4900-417: Was working forward from the technology instead of working backward from the business results you're trying to achieve." After Ries later co-founded IMVU Inc., IMVU investor Steve Blank insisted that IMVU executives audit Blank's class on entrepreneurship at UC Berkeley . Ries applied Blank's customer development methodology and integrated it with ideas from lean software development and elsewhere to form

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