The Lean Mindsetâ€and What it Takes to Measure Innovation

At the 2012 Olympics in London, Om Yun-chol, of North Korea, won a gold medal for weightlifting in the men’s 56kg event. He did it by lifting three times his body weight—only the fifth man ever to do so. Think about that next time you’re moaning about retrieving your suitcase from an overhead compartment. It doesn’t just take brute strength to lift an incredible amount of weight—it takes mental toughness. It takes a very specific mindset that’s shaped and chiseled by hard work, achievement, failure, and the kind of resilient drive that allows you to steamroll through obstacles. So you may wonder: how much does this apply to business? How about 100%? Whether you are interested in lifting twice or triple your body weight (good luck with that) or starting up what you hope will be a successful business venture, your mindset will make or break you. In our last post, on Lean startups, Professor Mike Grandinetti had this to say on the approach: â€Å"It’s a different method that requires a great amount of discipline, intellectual honesty and humility. You just can’t do it halfway. It’s necessary for you to re-frame your mindset in order to be able to say: I don’t know—the market knows.†Ã‚   Confronting that level of ambiguity takes mental toughness.   But it also takes more than that, especially when taking those first steps to turn an idea into a business. In her article â€Å"Ground Rules for a Startup: Build Your App with a ‘Lean, but Bold’ Mindset,† raw engineering CEO, Neha Sampat writes: â€Å"[Our company] has enjoyed its initial success because we have maintained a certain mindset: cost-conscious, bold, simple, and most of all, humble.† Sampat includes other nuggets to consider when building a Lean venture—some of which may sound counterintuitive to the traditional startup model (because they are): â€Å"Embrace your garage; there’s no need to run and get an office.† And, â€Å"The world is your sounding board—talk to everyoneif you don’t put your idea out there, it cannot manifest into a market-ready product.† All this to say that it’s wise to plan ahead (call it training?) before taking those initial steps to build a Lean business. After all, Om Yun-chol didn’t lift his greatest weight when he walked into a gym the first time. OK, you’re probably getting the point that starting a business and staying competitive takes several crucial mental elements and attitudes. And perhaps you already knew that. But there’s one more critical piece to consider as part of the mindset shift, which Professor Grandinetti also brought up with Hult Labs: â€Å"The traditional mindset is all about using financial ratios to measure the success of an idea—something you can’t do early on with your venture because you have no meaningful financials at this point†¦Rather than financial ratios or traditional accounting metrics, you should use something known as innovation accounting.† Eric Ries, who created Lean Methodology (and which has origins in lean manufacturing) has joked that there’s a big difference between innovation accounting and â€Å"innovative accounting.† We’ll explain. The Financial Times Lexicon describes innovation accounting as â€Å"the rigorous process of defining, empirically measuring and communicating the true progress of innovation—such as customer retention and usage patterns†¦When traditional accounting measures are used to measure innovation, it often has the effect of stifling or suffocating the new product or start up company [because] traditional accounting tends to work best when measuring established products.† The definition goes on to point out that typical key performance indicators, like ROI, financial ratio analysis, and cash flow analysis are not very useful when a fledgling startup is â€Å"burning cash well in excess of revenue.† In this way, traditional accounting metrics can actually fail startups in a really big way because they don’t truly capture what matters most as a startup is, well, starting out. Any wonder why you sometimes hear that accounting is killing innovation? During the Inc. GROWCO Conference in 2012, Ries asked audience members to imagine themselves as part of a startup that had failed to produce revenue in its first year of existence. Imagine further, suggested Ries, that you get a second chance—and one more year—to try again. So a year later, you pay a trip to your VC to provide a progress report. And here’s where the VC could use a little telepathy, because: â€Å"They literally cannot tell the difference between whether you have spent the last year actually on the brink of success, or†¦goofing off and doing nothing,† says Ries. â€Å"In both cases the numbers would be very much the same—very few customers and no revenue†¦A+ or F [performance] looks exactly the same using the standard accounting methods of the 20th century.† The bottom line is this: Lean Methodology isn’t for the faint of heart; it requires shifting some pretty ingrained thinking about how to start a business, and the type of key indicators you need to track progress. But if you hold firm to the main tenets of the process, it could increase your chances of translating a really great idea into a business venture that works. And it will take some mental toughness, along with believing in something others view as an impossible feat—just ask Om Yun-chol. Photo courtesy of Betsy Weber. Like game changers? Break the mould in the business world with a Masters in Disruptive Innovation from Hult. To learn more, take a look at our blog Why every leader needs a growth mindset, or explore overall business challenges with a Masters in International Business instead. Download a brochure or get in touch today to find out how Hult can help you to find out everything about the business world, the future, and yourself. Hult Rotation offers you a chance to study in a truly global way. Our rotation program allows you to study and be immersed in some of the finest cities in the world. 📠¸: @jasminmanzano . Hult Rotation offers you a chance to study in a truly global way. Our rotation program allows you to study and be immersed in some of the finest cities in the world. 📠¸: @jasminmanzano . Each year, Hult seeks to enroll a talented and ambitious incoming class from all over the world. We look for diverse students with a wide range of experiences, perspectives, and interests—students who will thrive in our unique educational atmosphere. Are you ready for a truly global experience? 📠¸: @iambrunadiniz . Each year, Hult seeks to enroll a talented and ambitious incoming class from all over the world. We look for diverse students with a wide range of experiences, perspectives, and interests—students who will thrive in our unique educational atmosphere. Are you ready for a truly global experience? 📠¸: @iambrunadiniz . We’re excited to start 2020 on a ranking high! Hult is proud to have been placed #28 in Poets Quants 2020 rankings for Best Undergraduate Business Schools in the US. Taking a huge leap of 32 places from our 2019 position, we’re also very happy to have secured top positions in key categories like: life-changing experience, practicality of the degree, and global immersion. . With five global campuses, a student body of over 130 nationalities, and a learn-by-doing approach—Hult offers a student experience like no other. . We’re excited to start 2020 on a ranking high! Hult is proud to have been placed #28 in Poets Quants 2020 rankings for Best Undergraduate Business Schools in the US. Taking a huge leap of 32 places from our 2019 position, we’re also very happy to have secured top positions in key categories like: life-changing experience, practicality of the degree, and global immersion. . With five global campuses, a student body of over 130 nationalities, and a learn-by-doing approach—Hult offers a student experience like no other. . â€Å"I’m from an engineering background and needed a whole new skill set for the industry I wanted to switch to. I learned a lot about myself and how I deal with being out of my comfort zone. I learned both soft and hard skills, from how to work in very diverse teams to key accounting metrics and strategy. I was surprised by how weak I was at certain tasks in English or how strong I actually was in other areas. Hult gave me opportunities to try new things and meet people from places I never thought I would have friends. . My internship experiences gave me the chance to broaden my view of different cultures and different companies. I had the opportunity to work and live with people whose values differed from people in my home country. I thought that this would be difficult, but it gave me the chance to reflect on my own values and assess if they were a result of my home country environment or if they were intrinsically mine. . Diederick ter Kulve (@diederick.terkulve) Netherlands Masters in International Business . â€Å"I’m from an engineering background and needed a whole new skill set for the industry I wanted to switch to. I learned a lot about myself and how I deal with being out of my comfort zone. I learned both soft and hard skills, from how to work in very diverse teams to key accounting metrics and strategy. I was surprised by how weak I was at certain tasks in English or how strong I actually was in other areas. Hult gave me opportunities to try new things and meet people from places I never thought I would have friends. . My internship experiences gave me the chance to broaden my view of different cultures and different companies. I had the opportunity to work and live with people whose values differed from people in my home country. I thought that this would be difficult, but it gave me the chance to reflect on my own values and assess if they were a result of my home country environment or if they were intrinsically mine. . Diederick ter Kulve (@diederick.terkulve) Netherlands Masters in International Business . Say a big hello to our Bachelor of Business Administration program cover star, Elisa Orus Plana âÅ" ¨ . â€Å"I’m excited for the future—especially that I cant predict whats going to happen. Maybe Ill end up in Mexico working for a trading company or maybe in Africa, developing my own business. Everything is possible, and the options are constantly changing. I love the idea that Im never going to be stuck doing the same job until the end of my life if I dont want it to be like this. . Hult really supports me and my ambitions and truly believes that we deserve to be considered as professionals as well as students. Here, I get to express not just my opinions but all elements of myself. From my creative side with the Fashion Society to my finance and business sides in Trading Club and the Management Consulting Club. We get a different type of learning here. Not just essential knowledge and theory, but practical skills and mindset. The school is always evolving. We’re encouraged to innovate and to always look for new ways of doing traditional things. We learn how to be more confident and become aware of how we can impact our environment. The school aims to help you become a better version of yourself and to stand out from the crowd.â€Å" . Elisa Orus Plana French Bachelor of Business Administration Class of 2021 Say a big hello to our Bachelor of Business Administration program cover star, Elisa Orus Plana âÅ" ¨ . â€Å"I’m excited for the future—especially that I cant predict whats going to happen. Maybe Ill end up in Mexico working for a trading company or maybe in Africa, developing my own business. Everything is possible, and the options are constantly changing. I love the idea that Im never going to be stuck doing the same job until the end of my life if I dont want it to be like this. . Hult really supports me and my ambitions and truly believes that we deserve to be considered as professionals as well as students. Here, I get to express not just my opinions but all elements of myself. From my creative side with the Fashion Society to my finance and business sides in Trading Club and the Management Consulting Club. We get a different type of learning here. Not just essential knowledge and theory, but practical skills and mindset. The school is always evolving. We’re encouraged to innovate and to always look for new ways of doing traditional things. We learn how to be more confident and become aware of how we can impact our environment. The school aims to help you become a better version of yourself and to stand out from the crowd.â€Å" . Elisa Orus Plana French Bachelor of Business Administration Class of 2021"> During the final days of 2019, you probably reflected on what you’ve accomplished this year—and even this decade—and what you’d like to achieve in 2020. Let us know in the comments below. During the final days of 2019, you probably reflected on what you’ve accomplished this year—and even this decade—and what you’d like to achieve in 2020. Let us know in the comments below. â€Å"The first time we did group work on the program, I went head-to-head with a colleague. It taught me a lot about how I see people, how people see me, and how conflict can be resolved in a kind and productive way. The best feedback you get, when delivered constructively, is the most critical because it really feeds into how you lead. I’ve completely reversed my leadership style—the result is so much richer and more powerful when you lead from behind and lead with strength. . Studying in tandem with working, whilst challenging, gave me the perfect platform to directly apply learning concepts into my business environment, the competitive landscape, and the real-estate industry as a whole. When I started the program, I was very happy in my corporate role. But my courage and aspirations grew to the point that I took on a whole new direction. Having my career coach, Joanna, as a sounding board allowed me to really be strategic and get to know myself. She coached me thro ugh all the interviews, the research, and the questions. It went in parallel with what I was doing academically and after six months everything just clicked. . I went into the EMBA knowing I had nothing to lose and I’ve come out with everything. Great strength, global friends, amazing learning, mentors from professors, a job I love, and the knowledge that I can set my mind to achieve anything and with the right support and resources I’ll get there.† . Kashani Wijetunga British, New Zealand Sri Lankan Associate Director Senior Strategy Consultant CBRE EMBA Class of 2019 . â€Å"The first time we did group work on the program, I went head-to-head with a colleague. It taught me a lot about how I see people, how people see me, and how conflict can be resolved in a kind and productive way. The best feedback you get, when delivered constructively, is the most critical because it really feeds into how you lead. I’ve completely reversed my leadership style—the result is so much richer and more powerful when you lead from behind and lead with strength. . Studying in tandem with working, whilst challenging, gave me the perfect platform to directly apply learning concepts into my business environment, the competitive landscape, and the real-estate industry as a whole. When I started the program, I was very happy in my corporate role. But my courage and aspirations grew to the point that I took on a whole new direction. Having my career coach, Joanna, as a sounding board allowed me to really be strategic and get to know myself. She coached me thro ugh all the interviews, the research, and the questions. It went in parallel with what I was doing academically and after six months everything just clicked. . I went into the EMBA knowing I had nothing to lose and I’ve come out with everything. Great strength, global friends, amazing learning, mentors from professors, a job I love, and the knowledge that I can set my mind to achieve anything and with the right support and resources I’ll get there.† . Kashani Wijetunga British, New Zealand Sri Lankan Associate Director Senior Strategy Consultant CBRE EMBA Class of 2019 . â€Å"It was now or never. I knew that I’d have likely stayed in my neighborhood for years to come if I didn’t take this opportunity. I’d not lived or studied outside of the U.S. before. So I left my job as a global strategist at an advertising agency and moved halfway around the world. I’ve come back a more culturally aware, well-versed person. I’ve realized that everything is a learning experience and an opportunity for growth. Ill definitely carry this mindset with me into the future. Technology and social media allow us to be different people in several places at once. Im excited to see how I can establish myself in whatever city Ill be lucky enough to call home and still maintain deep connections with people all over the world. I’m inspired by my classmates every day. Hearing some of their life stories and how getting this degree fits into their greater mission has been very humbling. My biggest challenge has been finding the ‘right’ path for me. There have been rooms Ive felt like I shouldnt be in, but now Im proud to feel as though I truly belong, wherever I am.† . Dwayne Logan, Jnr. American MBA Class of 2019 . â€Å"It was now or never. I knew that I’d have likely stayed in my neighborhood for years to come if I didn’t take this opportunity. I’d not lived or studied outside of the U.S. before. So I left my job as a global strategist at an advertising agency and moved halfway around the world. I’ve come back a more culturally aware, well-versed person. I’ve realized that everything is a learning experience and an opportunity for growth. Ill definitely carry this mindset with me into the future. Technology and social media allow us to be different people in several places at once. Im excited to see how I can establish myself in whatever city Ill be lucky enough to call home and still maintain deep connections with people all over the world. I’m inspired by my classmates every day. Hearing some of their life stories and how getting this degree fits into their greater mission has been very humbling. My biggest challenge has been finding the ‘right’ path for me. There have been rooms Ive felt like I shouldnt be in, but now Im proud to feel as though I truly belong, wherever I am.† . Dwayne Logan, Jnr. American MBA Class of 2019 . Happy New Year, Hultians! . Happy New Year, Hultians! .