What is a Lean Canvas?
The nine areas are Problem, Solution, Key Metrics, Unique Value Proposition, Unfair Advantage, Customer Segments, Channels, Cost Structure, and Revenue Streams.
Central to the Lean Canvas approach is the need to understand your customer’s problems as the first step before you can focus on the solutions to those problems and how to deliver them to the market.
The resulting chart represents how an organization creates and delivers value to its customers – or how it could do so in future.
Why use a Lean Canvas?
Use a Lean Canvas is to evaluate the potential of an idea before allocating time, effort, and resources into development. A one-page Lean Canvas is much faster and easier to create than a multi page business plan. It’s brevity, and simple format is readily understood by stakeholders and investors and easy to update in response to changed business conditions. Use it to:
- Develop an overview of the critical aspects that drive a business
- Streamline planning
- Facilitate conversations about an organization’s strategy
- Create an understanding of the plan across the entire organization
- Help employees collaborate better through a shared understanding of how the business operates and it’s environment.
- Underpin strategy execution, resource prioritization, and effective action plans.
Who should use a Lean Canvas?
The model is equally effective for both small and large businesses and is particularly useful for startups and entrepreneurs, and new products or services within an existing business.
As the organization or product develops, the Lean Canvas can evolve into a Business Model Canvas.
- Business Model Canvas
- Value Proposition Canvas
- Persona Template
- Strategy Sketch
- Petri’s FTE Canvas
- Carefully select participants to provide expert knowledge but also a fresh perspective.
- Use technology to involve critical people in different locations rather than miss their contribution.
- Minimize groupthink by brainstorming ideas individually then combining issues to get the overall picture.
- Be specific rather than broad when defining ideas.
- Use quantitative data where possible to focus on the crux of issue.
- Provide adequate time in the session to rank and prioritize ideas.
- Communicate outcomes to stakeholders and regularly update progress on actions.
Lean Canvas template
Problem
Questions to ask:
- What are the top problems our potential customers face?
- What are the existing alternatives that solve those problems (competitors)?
Solution
Questions to ask:
- How do we, or can we solve the problem.
- What is the Minimum Viable Product (MVP) that will address the problems?
Key Metrics
Questions to ask:
- What is the single most important measure that drives what we do?
- How will we know we are succeeding?
Unique Value Proposition
Questions to ask:
- What is unique about what we provide?
- Why would a customer choose our solution over other alternatives?
Unfair Advantage
Questions to ask:
- What do we do or have that deters copy cats and competitors and which can’t be bought?
Channels
Questions to ask:
- How do/should we, sell, deliver, and maintain our products and services.
- Which channels work best for each of our customer segments?
- Which channels are the most cost effective?
Customer Segments
Questions to ask:
- Who are our most important current and potential customers?
- What do they need or want?
- How do they think and feel?
- What do they do?
Cost Structure
Questions to ask:
- What are the primary cost drivers for our business and how do they relate to revenue and delivery of our Unique Value Proposition?
- Are costs fixed or variable?
- How will costs scale as we grow?
Revenue Streams
Questions to ask:
- What products and services are customers willing to pay for?
- How do they prefer to pay?
- How much does each revenue stream contribute to the overall total?
Lean Canvas vs Business Model Canvas
Like the Business Model Canvas, a Lean Canvas template has nine building blocks that combine to build a holistic overview of an organization’s strategy. However, Ash Maurya made the model more entrepreneur-focused by replacing four of the nine elements (Key Partners, Key Resources, Key Activities, and Customer Relations) with Problem, Solution, Key Metrics, and Unfair Advantage. Unique Value Proposition, Customer Channels, Customer Segments, Cost Structure, and Revenue Streams are common to both.
How to create a Lean Canvas
When developing your Lean Canvas, it’s critical to define and articulate your customer segments and their problems accurately first. After that, the rest of the canvas flows – Solutions, Unique Value Proposition, Unfair Advantage, Channels, Costs, Revenue, and Key Metrics.
It’s unlikely you will create a final plan in one session. Your canvas will develop as you test your assumptions against the realities of your market. However, you should be able to get the initial structure in place in less than one hour.
Brainstorm
As a team, discuss and populate each section of the canvas.
Vote
Individually vote on the areas you need to focus on.
Action Plan
Create actions for each of the top focus areas. Assign responsibility and timeframes.
Share
Share the outcomes of the session, including the action plan, to relevant stakeholders.
Gather ideas individually or as a group using a whiteboard, post-it notes, or an online tool like GroupMap. Start by identifying who you believe you are building your product or service for – Customer Segments. Then describe what their Problem is.
Next, decide on how you can provide a Solution to that problem.You can now work through the other areas of the canvas to work out what you have or need to deliver those solutions to your customers – Unique Value Proposition, Unfair Advantage and Channels.
With all those aspects in place you should be able to address the financial aspects of your business – Revenue and Costs.
The final step is to develop your Key Metrics.
Now organize and prioritize the ideas. Assign one or more votes to members of the group to determine priorities for action. Software tools like GroupMap can significantly reduce the time and effort required to group and rank ideas.
Identify actions for each priority, determine who is responsible for moving things forward, and set time frames for completion.
Distribute your Lean Canvas and action plan to all relevant stakeholders. Use the plan to monitor progress regularly. Update the canvas as the business and product evolve. GroupMap automatically generates visually appealing reports and action plans in several formats for distribution, saving time and effort after the analysis.
Save effort, time and money with GroupMap
Whether you have your best minds together in the same room, or distributed around the world, GroupMap’s unique technology allows groups of up to 2000 to submit ideas independently at separate times, from different places, in different timezones. Prevent dominant personalities swaying the group, drowning out the opinions of others – GroupMap allows everyone to brainstorm independently then effortlessly combines that information to reveal the full spectrum of ideas. GroupMap templates keep the objective front and center throughout the session, keeping everyone on task. This ensures the activity identifies actionable issues rather than becoming just a discussion on ideas. GroupMap gives you all the group decision making tools you need to prioritize, decide and take action.
Create your first map and invite people in to start sharing their thoughts right NOW. Experience the power of GroupMap with our 14-day, no risk, FREE trial. You don’t even need to provide your credit card details to access to all of our features, including the entire suite of templates, for a full 14 days.