We Can Tell You What The Superbowl MVP WON’T Be Right Now

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Sunday is almost here, and once again we hear “MVP” buzzing in the air.  We watch Peyton Manning in car commercials, Colin Cowherd on ESPN, and replays of season highlights as mention of who will be outstanding in this year’s Superbowl floats through our TV every few minutes.  Yet, for people who follow startups and study their architectures (like us and many of you reading this), each mention of MVP may trigger a very different thought–and it often does.  When someone says MVP, we often think of the Minimum Viable Product.  Whether or not you like football, if you are interested in business and startups you will probably like to hear more about this tool.

 

The Minimum Viable Product has been covered on the blog before, and can be one of the most valuable players in your lean startup.  Consider how easy it is to design an MVP for a service on the web.  For example, look in on modelsforadvocates.com.  Models For Advocates is a startup geared towards lawyers in the United States and beyond.  This innovative company uses additive manufacturing to create models for trial attorneys that are often highly accurate.  For example, they create models of patient disease or injury from CT scans.  The point, here, is not the Models For Advocates idea; rather, look at their website and see where they are in their lean startup lifecycle.  This website, hosted by wix.com, was straightforward to put together per the team’s report.  This was created in approximately 25 minutes and is geared towards learning whether there is a market for this service before the team goes live.  Granted, the team has the expertise and equipment to fulfil orders etc.  However, now, the team is testing what the demand is for this product and service before it iterates, pivots, or moves on.  It designed the most spare service that would deliver its value proposition and is testing it with potential customers.  Consider just how inexpensive it can be to do this nowadays.

 

This Minimum Viable Product creation has also been utilized by other startups. Consider, for example, the team Provider Lifestyle Experts.  Provider Lifestyle Experts provides virtual assistants, information, and lifestyle improvement techniques to healthcare providers in the United States and beyond.  This is a membership fee structure where healthcare providers pay to access a team of virtual assistants and obtain a certain useful information regarding lifestyle management.  Interestingly, the Provider Lifestyle Experts team has created a similar website to the Models for Advocates team.  The Provider Lifestyle Experts team has created a website with a signup box to gauge interest before proceeding on with the idea.

 

In both cases, we see an approach to startups which is relatively iterative, inexpensive, and straightforward.  Creation of an MVP, again that product or service that has the least number of frills for which customers will pay, is key in lean startup methodology.  Remember, the MVP or its best friend the Minimum Viable Service (MVS) will gauge exactly what potential clients will pay for and how much they will pay.  It has other distinct advantages, such as being the easiest product to manufacture or service to render and can often be useful in that it can focus on things like interchangeable parts or other facets that make it relatively straightforward to build and create.  Again, this is the attraction to the MVP and MVS: they allow us an ease of manufacturing and creation.

 

When we watch the Superbowl, we are seeing much more than an MVP.  We are seeing a mature production that has progressed far beyond the minimum for which people will pay.  As startups progress and mature, the need for the MVP will likely reduce or at least change.  The manufacturing process may become more refined, the service may become more intricate, and the experiment (the startup) may find success with iterating toward what customers want beyond the MVP.  Watching the Superbowl can remind us, by way of contrast, that the MVP is usually a spare and straightforward product.

 

In the end, our team on the blog can tell you something about what the MVP will be this coming Sunday in the Super Bowl, and in fact, everyday.  The MVP will always be that product that is the minimum product for which customers will pay at an appropriate level.  We invite you to utilize MVP techniques in your startup and have seen these used to great effect in our experience with multiple startup teams.  For more information regarding the startups described here please feel free to leave a comment or contact them directly on the websites listed.

 

Any other comments or thoughts?  Let us know.

The Tools Work: Startup Case Report

Every so often on the blog we explore the case study of a recent startup and highlight the use of some of the advanced tools we discuss as part of the startup’s background.

 

Here, we consider a startup we’ll call Very Awesome Homes (VAH).  VAH is a startup focused on rentals in the Greater Orlando, Florida area home rental market.  This startup team used multiple lean startup techniques in order to create the new venture.  First, there was an intentional focus on the team and its skills.

 

The team of three involved with VAH knew each other from previous business ventures.  They are NOT related, and have complimentary skills required to make a go of a business in this manner.  The skill set represented includes one team member with a focus on sales and services, another with an MBA (and startup) background and a third who is focused on logistics and infrastructure.  This team of three, prior to founding and the other steps of a startup, first made sure that it was compatible, experienced, and that particular skills in the team were complimentary to achieve this particular endeavor.

 

Next, the team focused on a lean business model canvas.  The value proposition was refined and focused on creating great experiences away from home at VAH’s rental properties.

 

Exactly what constituted a great experience?  These and other important questions had to be answered as the team focused on a sustainable source of competitive advantage.  It is a challenge to create sustainable competitive advantage in service and similar industries.  In general, almost anything that can be done can be imitated and is not easily protected by intellectual property constructs like patents, etc.

 

Here, the team briefly scanned the rental market and realized that important factors included proximity to the local theme parks, ease of access for potential guests to arrive at the locations from the airport, and, importantly, a focus on those things necessary to enjoy oneself while on vacation.  It was this latter portion that included how to enjoy oneself on vacation, that constituted some of the focus on the creation of competitive advantage by the VAH team.  The team decided its minimum viable product would include positioning with some unusual features for rental properties:  the team decided to include a 24 hour concierge service that was accessible for all guests at any of its properties so that people new to the area would be able to learn about some of the local features which can be very challenging to access otherwise.  The concierge could make reservations for the guests for things like meals and events.  The team also created an insider’s guide to the theme park area which focused on things that only locals typically know.  This was to be included as part of the minimum viable product and, as discussed before, the team focused on a luxury / premium model with premium pricing.  The team believed adding value with the concierge justified premium positioning, premium price, and differentiated their properties from others in the area.

 

The business model canvas also revealed other important features for the business, including channels through which the potential customer could access the rental property.  The team decided to use one web outlet on which they had done previous research regarding positioning, site views, and rentability of similar homes.  The team then signed up for this venue and worked on creating a posting.  The team also focused on obtaining professional photos to give their first rental property a premium feel and focus.  In addition to these elements of the business model canvas, the team immediately established an investment arm so that the revenue from the rentals could start to generate passive income for the company when the company reached that stage. This was done at the onset of the company so as to strengthen it from a financial position.  These interesting choices were based on findings from the business model canvas.

 

Another important focus of the team was scalability.  The team takes to heart the common definition of as startup as an experiment in finding sustainable, scalable revenue streams.  The team really did look upon this as an experiment from which they could learn and establish important metrics based on their business model canvas.  Next, the team completed all the important legal aspects including the relevant contracts, insurance, etc and went on to found Very Awesome Homes, LLC.

 

The lessons from this startup are clear, and, incidentally, VAH has gone on to success.  The highlights include the fact that VAH has already found a positive outcome from this experiment in finding a sustainable revenue stream.  The infrastructure of VAH is highly scaleable to more rentals whether they be properties owned by the company, the company founders, or other home owners in the area.  Lessons learned include the importance of a focus on scalable tools early on, premium positioning, and business model canvas in addition to other elements from the lean toolset.  The VAH team realizes the rental market may fluctuate with the economy and other issues, and so far their experiment has produced that scalable, reproducible revenue stream for which all startup / experiments hunt.

 

Questions or comments?  We are always interested to hear more about your lean startup ideas and stories of business models in which you have participated.

Why My Bag Flew For Free: Conditional Probability In Everyday Decision Making

Business model innovation requires high-quality decision making.  Sometimes, it is very challenging to apply the often counter-intuitive techniques to everyday decisions.  Here’s a personal story meant to highlight the application of a different way of thinking in an everyday context:

 

One of the interesting facts about explicit decision making techniques is they can be applied in everyday life, even though it seems difficult sometimes.  Our last several blog entries have focused on EAST 2014 and its conference in Naples, Florida.  Interestingly EAST 2014 had more than just lessons to teach from the podium during the conference.  For example, on my way back from the conference, I flew home on Spirit Airlines.  Spirit Airlines has a different restriction on bag sizes etc. and looks to charge you for different bag sizes.  Spirit has some useful bag sizing techniques for you to size your bag appropriately prior to attempting to board the plane.  If your bag is oversized  they look to charge you for bringing the bag on the plane.  $50 for smaller bags.

 

I had flown down to Naples on Spirit Airlines with the same bag with which I was flying back. Importantly, my bag had fit in the sizer at the airport on the way down. I knew that it would do so again as it was not overstuffed, it was actually smaller than it had been on the way down.  In checked in online and went to a kiosk to print my boarding pass because the printer where I was staying did not work.

 

The woman looked at my bag and said “You will need to pay $50 for your bag.”  I explained that the bag had fit in the sizer and had done so on the way down as well.  This bag was to be considered my carry-on and could fly for free.  The woman said to me that the bag could not extend above the sizer at all, which was not clear from the signage either at the Orlando Airport or at the airport from which I had flown.  It fit in the sizer but was slightly taller than the cage style sizer they had available.  It was approximately an inch or two.  I explained nicely to the woman that the bag had fit on the way up and had fit in the overhead compartment on the jet, had fit in the sizer, and I had not been charged or even questioned on the way down.  The woman then gave me a puzzle without realizing it:  she said that the bag would be $50 there or $100 if there was an issue at the gate.  I then considered the different ways in which the scenario could go.

 

Consider a decision tree, similar to the decision trees we have had on the blog before in other entries.  This has become my habit over time and I wanted to use this tongue in cheek example to demonstrate how this can be useful in everyday life.  The question was, at that time, do I pay $50 for the bag at this kiosk or do I take a chance and bring the bag to the gate where it may cost $100?  I envisioned the situation as a decision tree.  The expected payoff was listed and the rough probabilities to my estimation where included.

 

From my experience of flying with Spirit (no data available on this so I had to use probability estimates) and out of the MCO Airport let me know that the gate was sparsely manned, often overwrought with people, and that the staff were unlikely to give me any issues even if I tried to carry an elephant on the plane.  So with the decision tree in mind the expected utility was best for me to thank the woman and tell her I would bring my bag with me.  I thanked her and left.  My expected utility from the branch “take your chances at the gate” was higher overall.

 

Sure enough, at the gate 30 minutes later, the situation was as expected: the gate was overwrought with passengers, and no one paid attention to many of the bags that were much larger than mine which were being brought onboard. And even though only zones 1 and eventually 2 were being called, passengers from zones 3 and 4 boarded right from the beginning and sort of crashed the gate en masse.

 

The lesson here: Decision making techniques like the decision tree can be useful in everyday life.  I don’t tell you this story to tell you how I was right or claim victory.  I tell you this because the woman at the kiosk had used some powerful techniques to cajole me into paying $50 for a bag which was unlikely to be a problem.  She used such techniques as anticipated loss to attempt to get me to pay for a bag which was likely, in fact, to make it through the gate situation.  Anticipated loss is a powerful psychological technique where the anticipation of loss in the future is used as a strong motivator to get us to do something now.  The idea that it will be ‘worse in the future’ can be used as a motivator even when this is statistically unlikely.

 

From this and many other experiences I recommend a moment to think through different decisions with conditional probability.  Yes I may have had to shell out $100 at the gate if we ran the scenario over and over again.  In fact, if we had a computer run the scenario hundreds of times there would be some instances where I was out $100.  However, based on the statistics involved and experience it was exceedingly unlikely that this was going to happen in this particular scenario.  I invite you to use techniques like this in your everyday life for such things as purchasing insurance from Best Buy for new electronics etc.  These techniques are especially useful when you are deciding whether to invest in a company, the market, or making decisions with your innovative business model.

 

Questions or comments? Please feel free to give your thoughts beneath.  Do you have any instances where rigorous thinking helped you avoid unnecessary expense or issue? I would love to hear them.

Magnet Designation Associated With Improved Hospital Outcomes: EAST Day Three

Naples continues to be sunny and filled with powerful talks from influential trauma surgeons.  Today’s EAST conference saw Dr. Tracy Evans, from Lancaster General Hospital, deliver a clear message regarding nursing Magnet designation and an association with mortality data.  Dr. Evans and colleagues showed data to support their contention that Magnet designation is associated with improved mortality at hospitals with existent trauma center designation.  Dr. Evans, at the morning scientific

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paper session, clearly demonstrated data to substantiate her, and her colleagues’, experiences to date.

 

Dr Evans specifically touched on the the forces of magnetism, and described the impact of nursing care on trauma hospitals.  Dr. Evans highlighted data from 27 trauma centers in Pennsylvania that had been reviewed by the Pennsylvania Trauma Systems Foundation.  An important inclusion criterion from the study involved taking data only from level 1 and 2 centers with admissions greater than 500 qualifying patients per year.  Seventeen of these accepted centers were non-magnet hospitals and this portion of the group represented 42,000 patients.  Ten other centers were magnet designated and contributed 30,000 patients to the sample.  Dr. Evans and her team then used a multi-variate analysis to demonstrate 20% less mortality in magnet designated centers, which represented a statistically significant difference between the two types of centers.  Evans stressed that this mortality reduction is on-par with that seen among hospitals with trauma center designation versus those without.

 

Clearly, this fine study demonstrates correlation rather than causality.  Are we able to extrapolate that nursing magnet designation is causal for better quality? We are not.  However, we have learned that magnet designation is one more way in which participants in the healthcare system can get a sense of overall quality in a hospital type institution. Again, we are unable to tell whether magnet designation causes improved quality but we can readily think that having magnet designation is associated with the presence of increased quality.  This represents nice work by Dr Evans and her colleagues.imagejpeg_0

 

In attendance, as an impressive show of support, was the advanced practitioner team from Lancaster General and Dr. Fredrick Rogers, Trauma Medical Director at Lancaster General.  Dr. Evans, with this abstract submission and presentation, will be moving toward the “trifecta” for publication and awaits, with good probability of success, journal acceptance and publication.  This represents one more piece of evidence linking nursing standards to quality of care provided by an institution.  I, and other members of the blog team, look forward to the continued academic strength and data coming out of Lancaster General Health under the guidance of Dr. Rogers in association with his team.

 

 

Trauma & Emergency Surgeons Told To Include Themselves With General Surgery: EAST 2014 Day Two

Today’s 2014 EAST conference in Naples, Florida saw an improvement in the weather and continued excellent talks from recognized leaders in the field of Trauma and Acute Care Surgery.  Dr. David V. Feliciano gave the Scott B. Frame memorial lecture and advocated a return to previous practice principles. Included in his talk were the conservative ideas of representing trauma and acute care surgery as “no different than general surgery” and an admonishment to young trauma surgeons to avoid “separating themselves from general surgery”.  These and other conservative comments were signposts as Dr. Feliciano recreated the mental map he and others have used to achieve success in academic trauma and emergency surgery.

 

Dr. Feliciano advocated several useful ideas including the calculation of each individual’s Hirsch index (or H index).  The H index represents a measure of how many times the individual has been cited by others in publications.  He contrasted this against the typical impact factor for journals and said that the H index is utilized by promotions committees at academic centers.  In addition to useful specifics, Dr Feliciano gave other advice to young academic surgeons, including ways to avoid unproductive overcommitment to activities that do not add value to their careers.

 

Some of Dr. Feliciano’s other ideas emerged as he reported on a lifetime of career success. He advocated that young clinicians start their collections of famous papers early, and that the way ahead in terms of publication was the “trifecta” which includes:  submitting an abstract to a conference, a podium presentation of that work, and, finally, journal publication of that same research.

 

In the last 5-10 years, as we know on the blog, there has been an explosion of innovative online publication techniques.  Dr. Feliciano’s classic rendition of the pathway ahead for young surgeons did not focus on these newer models or disruptive business models for Surgery as a whole.  This left questions for some young surgeons such as whether the way ahead in years previous will continue as the way ahead in the future.  Again, some young surgeons were considering the new classic quotation that we must “evolve or die”.  How do the innovative systems that influence Surgery so much fit into the path for young surgeons?  Will promotions committees ever consider, as the Twitterverse has wondered, social media and associated publications as an influencer for promotion?

 

Regardless of the specific reaction to Dr. Feliciano’s excellent lecture, it is challenging to argue with a career and experience as successful as his has been given his lifetime of prominence in trauma and emergency surgery.  The young surgeons look forward to determining whether the way ahead in years previous will continue to be the way ahead he described given the new techniques, tools, and in light of the American College of Surgeons’ recent focus on innovation in Surgery.  Will the models for research and publication described in this year’s Frame lecture persist into the next decade, or will new techniques including business model innovation move regularly to the forefront?  Only time will tell, and, as for now, we are left with an exposition of a classic pathway ahead in academic surgery that leads to both academic and clinical strength.  For that we can all appreciate Dr. Feliciano’s excellent talk and look forward to EAST day 3.

2014 EAST Conference Begins In Naples, Florida

 

The Eastern Association for the Surgery of Trauma commenced its 2014 membership assembly in beautiful Naples, Florida, January 15th.  Popular topics this year included the immunomodulatory effects of red blood cells as one of the scientific, plenary presentations.  Interestingly, exhibitors this year varied from fledgling device companies to surgical staffing solutions.  Featured prominently was Emergency Surgical Staffing, LLC, a staffing solution meant to displace locum tenens surgery.  The EAST foundation president, Dr Fred Luchette gave his introductory speech which highlighted EAST’s various contributors.  The day saw numerous examples of scientific and business model innovation including new ideas in the world of basic science, and, as mentioned, device manufacturing. 

 

At this year’s conference, EAST continued the tradition of a conference-associated application for iPad and iPhone.  The app features the conference schedule and even photos of the scientific posters.  This year’s conference, in sunny Naples, has all the makings of another successful EAST endeavor.

 

Next year’s conference will be at Disney’s Contemporary in Orlando Florida.  We will be blogging daily from this year’s EAST conference, so join us for updates on the weather, scientific highlights and images of the people seen and heard around the EAST venue.

How-To Guide For Surgical Innovation: A Book Review

 

Book reviews, and reviews on literature regarding innovation in Surgery can be useful tools to help decide where to spend our scarce time.  Here, we review a very useful text book called Bio-Design: The Process of Innovating Medical Technology.  This book serves as a great template for how to innovate in the field of Surgery.

 

This text was published in 2009 and has contributing authors including: Stefanos Zenios, Josh Makower, Paul Yock, Todd Brinton, Uday Kumar, Lyn Denend and Thomas Krummel.  About 5 years ago, Dr. Krummel spoke near Center Valley, Pennsylvania, at the Lehigh Valley Health System.  It was there that I was exposed to just how process-oriented the Bio-Design system had become.  In short, Dr Krummel and his colleagues at Stanford demonstrated a nice pathway for how to evolve, rate and create companies out of the talented surgical residents and interdisciplinary teams they helped form.  This Bio-Design text mostly captures a sketch of that system and makes it a readily available template for other centers across the country.

 

One of the most useful portions of the text is its organization.  It is clearly organized from brainstorming and conceptual phase down to licensing and beyond.  Some of the more interesting facts that you can glean from the text include the idea that the Stanford system has this innovation pathway mapped to such a level that the staff maintains a computer database with which they attach ratings to different ideas and potential startup teams.

 

Why is this pathway so attractive?  There are at least two reasons:  (1) effective innovation can help more patients than we could ever help in our day-to-day work, and (2) innovation provides a non-patient volume-based revenue streams that is very effective.  That is, each of these medical devices has the potential to return multiples of investment.  Therefore, in years where patient care numbers are decreasing or have issues, these non-patient volume sensitive revenue streams are even more useful.

 

What I especially like about the process described in Biodesign is that it leverages human capital to a very full degree.  The text clearly conveys how the program achieves this end.  It highlights how this system takes motivated future/current physicians and plugs them into a process that gives them the ability to create their own medical devices and companies.  Again, they can leverage these companies to help more patients with amazing designs and devices than they could otherwise help in day to day practice seeing patients in the office.

 

Other hightlights of the book include thoughts and quotes from known innovators.  Dr. Thomas J. Fogarty, of Fogarty catheter fame, is one of the Stanford physicians and his comments throughout certain portions of the book are insightful and relevant.

 

The book also contains several directly useful tools. Some of these include sample non-disclosure agreements and other legal documents.  The FDA regulatory process, both for compassionate use and other pathways, is clearly explained such that even a person inexperienced to the process can come to understand some of the various regulatory issues and challenges in bringing a device to FDA clearance.  Of the various textbooks on medical device innovation and biodesign I cannot recommend this text strongly enough.  Its ease of use, clear organization and practical tools makes it an excellent primer for healthcare executives and clinicians who have an interest in the bio-design process and who have an excellent idea that they might want to bring to market.  If you have a moment visit Amazon.com.  You will find the textbook available for download as a Kindle textbook or available for purchase as a hardback.

 

Note the author has no financial association with the publisher of the textbook, the various surgeons and clinicians involved, or any association with the university mentioned.

New 3D printing technology revealed at CES 2014 conference

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One of the regular features on our blog includes 3D printing as a vehicle for surgical innovation.  This year’s consumer electronics show (CES), in Las Vegas, highlighted multiple new 3D printing technologies.  Some of the more interesting ones include the 3Doodler, the new series of Makerbot 3D printers and the new Chef-Jet 3D printer series.

 

This blog focuses on potential applications of technology similar to Chef-Jet in the field of surgical innovation.

 

Some of the at-home applications of 3D printing include PLA or ABS plastic based creations.  Both PLA and ABS have interesting structural characteristics, and PLA has become the plastic type of choice owing to ease of home use.  However, new print media are already coming.  Just as 3D printing represents disruptive innovation for multiple existing technologies, the new 3D printers and possible new media are evolving this cutting edge industry at an exciting pace.

 

For example, new hardware is already displacing certain elements of the market.  The 3Doodler, which recently arrived at my home (see photo above), is a handheld pen which utilizes PLA filament so as to allow the user to create plastic objects via additive manufacturing by hand.  See the photo above.  Letters made in about five minutes with the 3Doodler.  These by-hand prints are often not to the resolution of most non-freehand, “traditional” (amazing we can apply the word “traditional” to 3D printing at all) 3D printers. However, these can serve as rough sketches for later, more definitive creations, are rapid, and are amazing in terms of what can be produced quickly.

 

In addition to the 3doodler, other hardware is already evolving.  We described in an earlier blog post the importance of creating an entire ecology around your innovation. As mentioned, Makerbot and other 3D companies have done this with different 3D scanners as part of their system.  Makerbot recently released a 3D scanner, and presented an amazing new lineup of printers at the CES conference.  These now feature heated build areas, which I can attest would make all the difference when I go to print objects in my cold office.  The current Replicator 2, an amazing device itself, would be that much better with one of these heated areas.

 

One of the interesting, new technologies was recently debuted at CES.  This is the Chef-Jet 3D printer.  The Chef-Jet 3D printer prints in edible media including sugar, vanilla, chocolate, sour apple, sour cherry and watermelon.  This is expected to begin shipping in late 2014.  There will be both a professional grade and an at home grade Chef-Jet.  Wedding cakes and at-home recipes may never be the same.  At this point it is important to mention that the author of this blog post is a stockholder in 3D systems, stock ticker DDD.  I have been a stock holder for about 2 years and did not know this technology was coming.  However, now that it is here, I couldn’t be more interested.

 

Now, consider the logical extensions of printers and these new media: Now, surgical innovation is possible with resorbable matrixes and other resorbable scaffolds.  That is, we will be able to create, cheaply and effectively, collagen scaffolds for things like drug delivery, eventual tissue ingrowth and other similar devices.  Clearly this will make intellectual property and device manufacturing both paramount and in flux over the next several years.  In fact, companies in Cambridge, UK, are already making bio-resorbable, implantable, printing filament.  Importantly, these tissue scaffolds and similar issues have already been explored.  For example, Organovo has explained that a 3D printed liver will be available for pharmaceutical companies on which it may test new drugs by the end of this year…truly amazing.

 

This blog post highlights some of the interesting twists and turns of what can be described as the 3D printing revolution.  The different companies involved are poised to truly disrupt, in a positive way, the manner in which we have done things.  In surgery, this is coming and, in fact, is already here.  The new generation of 3D printers, some of which debuted in 2014 at CES are already here and soon will allow hospitals across the country to purchase the ability to make biodegradable implements.  Indeed, there are already English manufactures that make filaments for 3D printers that are implantable.  Check back in our blog often for updates regarding the 3D printing revolution and its impact on surgery in the coming months.