The Lemonade Stall: How to Test and Validate Ideas

Citation preview

PRAISE FOR THE LEMONADE STALL The Lemonade stall is a great book that uses a fun and relatable story to teach us all about the benefits of outcome-focused user testing. It's all too easy to get fixated on one’s great idea without understanding what our customers really need and David's book contains ideas and exercises that can help prevent that bias. I enjoyed reading the story and in particular appreciated the focus on carefully designed, minimum viable tests, multiple rounds of testing and a focus on outcomes in order to really understand customer needs. STEPHEN JANAWAY, VP ENGINEERING AT BLOOM & WILD

David manages to cleverly use a story on a lemonade stand to teach the basics of entrepreneurship in a fun, compelling way. Highly recommended read. JONATHAN SUN, ENTREPRENEUR

A truly enjoyable read that emphasises the importance of challenging your own bias through customer feedback in order to produce more inclusive products. A must read for any customercentric business. ESHA BAKSHI, MOONPIG

A really fun and approachable way of learning about the scientific method — including both its relevance and necessity in the world of complex product development, and how to actually apply it to increase your chances of success. It's an easy and enjoyable read, and you'll likely learn a few things along the way. Great stuff! NEIL KILLICK, AUTHOR, SPEAKER AND PIONEER OF #NOESTIMATES

THE LEMONADE STALL HOW TO TEST AND VALIDATE IDEAS - A STORY AND WORKBOOK

DAVID LOWE

Copyright © 2021 by David Lowe All rights reserved. No part of this book may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without written permission from the author, except for the use of brief quotations in a book review.

For Amelia, Isabella, Helen, Mum and Dad

CONTENTS

Preface How to use this book Part I 1. The discovery 2. Interviewing the neighbours 3. Testing, testing 4. The scientific method bombshell 5. The first question 6. The hypothesis 7. Round one 8. Round Two 9. Round Three 10. The fun run 11. The future Part II The essay Part III The exercises The answers Want printed exercises? A summary of the scientific method Get some free stuff Acknowledgments About the Author Also by David Lowe Also by David Lowe

PREFACE

WARNING: This story may sound very familiar! Not only does The Lemonade Stall contain many of the same characters from The Innovation Revelation, but it also takes place simultaneously (apparently the official term for this is a ‘paraquel’). Those of you familiar with the previous book will remember that it was centred around the antics of Charlie Blades, manager of online sales (womenswear) at Nuttinghams department store, who was struggling to survive in a faltering retail industry ... until his children inadvertently showed him an alternative way of working when planning a lemonade stall for a local fun run. The Lemonade Stall follows the children’s adventure as they discover their business empire is a failure before it even begins, then try to adapt their dreams using an approach from a school science lesson.

HOW TO USE THIS BOOK

This book contains three sections: Part 1 is the story described above. It uses a memorable story to explain how you can use the scientific method to test and validate ideas. Part 2 is a short essay for those people who would like to think about how this applies to their environment. It may be taken to support your understanding and to explain to others why they should follow this approach. Part 3 is a collection of exercises for you to use alone or with friends and colleagues. The intention is for you to question your current ways of thinking and discover new possibilities. For maximum benefit, I would recommend reading them in order, but no harm will come if you read them out of sequence (there are only a few elements which refer to an earlier part which you can skip over and come back to at a later time).

PART 1

1 THE DISCOVERY

‘It isn’t about earning money, it’s about us being part of the community,’ Pen states with an earnest expression, shoving the village newsletter towards her friend. ‘Right,’ Scarlett responds with an equally serious look. She takes the pamphlet and studies it closer, wrinkling her nose a little at the words. ‘Run 5k. Hmmm, what are you thinking we could do?’ ‘Well, I’m not thinking we should enter the race!’ The girls descend into a fit of laughter. ‘What about a lemonade stall?’ proposes Pen. ‘Like the one we did on the front lawn that time.’ They both know that this wasn’t a success even by a nine-year-old girl’s standards. They’d had two customers and both were related to them. But a fun run is different; their houses are in a cul-de-sac with no passing trade, whereas a fun run has a captive audience. ‘Sounds good,’ her friend replies. The bell rings to get to class. ‘Let’s plan it later, right?’ shouts Scarlett as she reluctantly enters school. After a lesson on algebra, Scarlett, Pen and another friend play at ponies, running around, going on camping trips and hiding under the large chestnut tree when the pretend thunder starts. The ordeal of lunch soon follows. Scarlett sneaks the disgusting shepherd’s pie into the food waste bin and shares Pen’s packed lunch. School lunches are a bit of a gamble: sometimes grim but other times inedible. But Scarlett doesn’t want to burden her already busy mum with making a packed lunch on a daily basis, so she weathers it. The post-lunch game pretends that evil year sixers have taken over the school and the girls have to make a survival plan. Thursday afternoon is English followed by art. Both girls’ favourite lessons. The day culminates with the task of making a collage of their favourite things. For the girls, this means: ponies, unicorns, cuddly toys of various forms, pizza and dough balls, spaghetti carbonara and a few Disney films.

Finally, the bell rings, freeing the girls from their scholastic captivity. The walk home seems shorter than ever before, with the girls explaining the golden opportunity to Pen’s younger sister, Emily. It’s a lovely warm summer afternoon. The kind of day that encourages lazy lounging with ice

lollies and paddling pools. But not today. The girls spread a picnic blanket on the front lawn and lay out a selection of stationery. ‘So ... lemonade,’ reiterates Scarlett ‘Yes.’ Scarlett writes L-E-M-O-N-A-D-E at the top of a crisp white piece of A4. Then, very carefully, underlines it with a yellow highlighter. ‘My dad said the reason we didn’t sell more lemonade last time was because it wasn’t real lemonade,’ reveals Pen. ‘It had lemons in it though.’ Scarlett clarifies. ‘So it was lemonade. Wasn’t it?’ ‘Isn’t lemonade fizzy?’ asks Emily. ‘I don’t know.’ The girls head inside to investigate further. It doesn’t take them long to discover that lemonade doesn’t have to be carbonated and most recipes give the ingredients as just lemon juice, water and sugar. ‘What?! It says “blend until the lemon is finely chopped”’ snaps Pen. ‘We’re not going to be allowed to use a blender on our own.’ ‘So, we either need to get someone to help us or stick with our original version of lemonade,’ they agree. Their original version being just water with a segment of lemon plonked in it. The trio examine their options, then postpone any decision until they are able to discuss it with their dad. They drift off into a game of pretend lemonade stalls using a tea set and a variety of plastic fruit. ‘Your dad’s nearly home,’ announces Jess. Jess is Pen and Emily’s mum. The girls run outside to continue their game in the street, then bundle their father to welcome him home. ‘Dad?’ asks Pen. He doesn’t respond. He’s too busy chatting to the mums. ‘Dad?’ asks Pen again. ‘Mr Blades?’ Scarlett joins in. Eventually the girls get his attention. ‘So, we are going to set up a lemonade stall at the fun run. We were talking about whether we should consider selling proper lemonade this time though. You said that we should do that next time. But how do you know that your proper lemonade is better than our lemonade, Daddy?’ The girls are proud of their grown-up approach to their enquiries. ‘Well, it’s what I’d want,’ their dad replies, returning to his conversation. Pen tries to compute the answer. It doesn’t really make sense as her dad doesn’t do running. ‘But you’re not running the race, are you Daddy?’ she clarifies. He confirms he isn’t. Now it’s Emily’s turn to show that she’s grown up too. ‘Do we know anyone actually running in the race?’ she asks. Her mum suddenly comes over. ‘Vinod round the corner is running.’ This is it. The girls need to speak to their neighbour. None of them knows which one is Vinod, but it doesn’t matter. ‘Can we go and speak to him, Daddy?’ they plead in unison. They know that he’ll give in if they ask him enough times. ‘Sure.’

2 INTERVIEWING THE NEIGHBOURS

There is a sense of anticipation and excitement as the small crowd walks to their neighbour’s front door. Thankfully, someone is home and answers the door. As grown-ups go, the girls consider that Mr Panesar—as they know him—is one of the good ones. When he sees them around, he waves and says ‘hi’. But not in the way that some adults do; he speaks to them like they are adults. So they’re glad to see that this is who Vinod is. After their dad explains why they are there, Mr Panesar drops a bombshell. ‘I’m afraid runners would bring their own drinks normally. And they’d bring food too. Nowadays we have special rehydration drinks and energy bars.’ What?! He brings out some sort of gel bar as an example, but the girls aren’t bothered about seeing it. This is bad news. The whole lemonade stall is now a failure. It had seemed such a good idea too. Pen looks like she’s going to cry but she doesn’t. Mrs Panesar joins the conversation on their doorstep. She starts to tell her husband off for not drinking enough water when running. It’s always amusing when adults tell other adults off and, normally, the girls would be loving the entertainment. But not today. Not now their business idea is ruined. Then Mrs Panesar comes to the rescue. ‘I tell you what you girls could think about though,’ she says. The girls’ faces look up hopefully. ‘Something for the poor people like me. We stand outside for hours to cheer our loved ones on, in whatever weather this country decides to throw at us on the day. There’s nothing supplied for the crowds of onlookers like me. The runners go around the village a few times and it’s pretty boring.’ She then continues to throw in other ideas like blankets to sit on, umbrellas when it rains, books to read or things to do. The girls look at each other excitedly. Scarlett takes control masterfully. ‘Why don’t you just take these things with you?’ Good question, thinks Pen, wishing she’d thought to ask that. Mrs Panesar thinks for a while. ‘When getting ready for a big race, Vinod gets… I mean some runners get a little bit stressy. So their partners are usually focusing on just getting them out of the door with everything they need, rather than worrying about themselves. Then you find yourself stuck without anything and

you dare not go home in case you miss them running by.’ It’s Emily’s turn now. ‘What kind of food or drink would you like,’ Emily asks. ‘Lemonade? Lollies? Marshmallows?’ Pen thinks this is also a good question and pats her little sister on the head in approval. Mrs Panesar says that lollies are good on hot days but she’s had them melt in her bag before. She’s not fussed about marshmallows (who knows why?!). She’s quite keen on the idea of biscuits and cake although those too have ended up crushed in her bag. And she could be tempted by a cold or hot drink depending on the temperature of the day. This is wonderful news! They have a business again! The girls want to get on with planning this new idea, but don’t want to appear rude so they continue to stand on the doorstep listening to Mrs Panesar. Pen wonders what the bottom of Mrs Panesar’s bag must be like. Why are adults so messy, yet tell us kids that we are the messy ones? At that moment, Mrs Panesar looks at her watch and says she has to go and pick up her son. Perfect. Planning here we come!

The girls move back to the blanket and start filling sheets of A4 with what Mrs Panesar has just told them. Lollies - yes Marshmallows - no (still don’t know why?!) Biscuits and cakes - yes Drinks - yes Umbrellas - yes Entertainment - yes ‘Do you think we already have the ingredients for all of this in our houses?’ Scarlett asks without looking up from the page. ‘Maybe,’ Pen replies. ‘But we could ask for some extra pocket money just in case.’ It’s always worth asking for this, just in case. They weigh up who is best to ask. Mr Blades gives up ten pounds without much objection. The girls were only going to ask for five pounds but decided to go much higher to chance their arm. Scarlett’s mum, Sarah, announces that everyone is having pizza at her house tonight. ‘Yes!’ The girls move from the blanket onto the dining room table. Annoyingly the adults call them back to bring in the blanket that’s been left on the front lawn. Any of the adults could easily have picked it up themselves on their way in, but they do this to make a point. Ideas stream out of their heads. Ice cubes with fruit in them. Orange squash lollies. Blackcurrant lollies. Hot tea. Cold lemonade. Flapjack. Fork biscuits. Umbrellas. Blankets. ‘There are so many ideas!’ declares Pen after they have filled a page with possible products. Sarah comes in. Pen relays their problem. Sarah is a good listener.

‘Well, what is your business all about, girls?’ she asks. ‘Food and drink,’ the children agree. But that doesn’t help much because there are gazillions of foods and megatrillions of drinks they could offer. ‘Well, when I’m at work, we test out new ideas with customers before we even start to build a product,’ Sarah explains. ‘That way, we get feedback on various possible solutions to help us work out which ones might be more successful than others.’ Again there is hope. ‘Mrs Panesar said that she’d be happy for us to knock on her door,’ shouts Scarlett. ‘Can we have some cookery books please Sarah?’ asks Pen. Sarah delivers a stack of books and the girls share them out between them. ‘Right, let’s each choose a few suggestions and decide on a few to test first’.

3 TESTING, TESTING

The next day at school is tough. As well as being the end of a busy week, it was also a late night by the time they went to bed last night. Parents tend to forget about school and work once they get talking. Despite their fatigue, they are still excited: Sarah has agreed they can do some cooking after school. Within the hour, Sarah’s beautiful kitchen is covered in flour, butter, oats and various forms of sugar. ‘Looks like we’ve got some tasty stuff here, girls,’ Sarah says, licking one of the mixing spoons and throwing it into the sink that is already full of pans and bowls. It seems like an eternity before the biscuits, flapjacks and traybakes have cooled enough to be eaten. ‘Shouldn’t we try them first?’ Emily enquires, pulling her cutest face. ‘Let’s have one between us,’ Pen dictates. ‘We need to hear what other people think about them.’ A few seconds later and the girls confirm their products are ready for feedback and start putting them in boxes. Emily sneaks another small square of brownie when she thinks the big girls are not looking. ‘Em!’ scolds he big sister, wafting her away. ‘I’ve only tooken one,’ she pleads innocently. ‘Taken.You’ve only taken one.’ ‘Whatever,’ Emily replies, swallowing her contraband brownie with a cheeky smile. The Panesars’ house is the obvious place to start.

‘Lovely.’ ‘Tasty.’ ‘They look beautiful.’ ‘I would buy all of them.’ The girls are overjoyed as every neighbour gives them positive feedback and all of their inventory is eaten with enthusiasm. ‘That’s it then. We will make brownies, fork biscuits, flapjacks, carrot cake, cupcakes, cornflake cups, marshmallow crispy squares and crumble bars.’ Propelled by their findings, Scarlett bids the girls to follow her into the garden. Curious, Pen

and Emily follow her. Scarlett’s garden is not as long as the Blades’, but it is meticulously cared for. One side has a beautiful array of flowers and ornamental plants, such as peonies, hollyhocks, dahlias and coleus; the other side has a collection of herbs that Sarah uses in her cooking. Pen loves dangling her arm behind her so that the tips of her fingers brush against the soft petals and strong smelling aromatics. Down the middle of the garden is a block pavement that separates a small patch of grass. At the bottom is a shed. Scarlett is waiting by the door with a grin that stretches the width of her face. ‘Are you ready?’ Pen and Emily look at each other in confusion. Scarlett opens the door and the girls are amazed to see that the garden shed—which is normally full of old bikes, plant pots and tools—is empty apart from 3 bean bags. ‘Mum said we can use it as our operational headquarters!’ ‘A-M-A-Z-I-N-G!’ shouts Pen. Emily rushes forward, throwing herself on the blue bean bag. Her favourite colour. ‘We are allowed to put things on the walls and mum says that she’ll get a table and some chairs out of the loft later.’ The girls decide that they deserve to spend some time kitting out their new HQ, so Pen rushes home to find a few donations. It takes her longer than anticipated, but she returns triumphant. ‘Look! We can put these hanging from the ceiling,’ Pen explains, pulling out a string of fairy lights. ‘And I’ve got some cushions, a blanket and this.’ It’s an old, battered pewter tankard. Scarlett and Emily look back and shrug their shoulders. ‘I thought we could put our pens in it.’ She holds up a bag of loose pens and pencils. Emily grabs the mug and stationery in order to arrange them. When Sarah goes into the loft, she brings down a few additional offerings: an old rug that covers most of the shed floor, a corkboard and a slightly tatty coffee table. The corkboard fits perfectly on the long wall opposite the door and the coffee table has a secret drawer in it where the girls decide to store their top-secret information: their recipes and shopping list. Sadly, the time flitters away and it is bath time far too soon. Pen turns off the fairy lights and the girls take one last look at their new HQ before Scarlett secures the barrel bolt on the shed door. ‘See you tomorrow.’ ‘Bye.’ Bedtimes can be frustrating. At least they have their business empire to think about.

4 THE SCIENTIFIC METHOD BOMBSHELL

‘So the five steps that scientists use are?’ Mrs Coney asks the class. It’s not really much of a question as it’s written on the board behind her. But that’s what teachers do: they ask you questions just to get you to repeat it back to them so they can say that you’ve learned it. At least that seems to be the case. ‘Ask a question … gather information about the question like a detective … form a hypothesis … test the hypothesis … tell others about what you have found.’ ‘That’s right,’ Mrs Coney congratulates the class, although partly self-congratulatory as well. ‘For example, we might ask “why do we feel more energetic some days than others?” What information might we gather to investigate that?’ The class erupts into a sea of hands in the air. ‘We might look at what people eat?’ ‘How much people sleep?’ ‘The amount of exercise we do?’ Mrs Coney regains control. ‘All of this is good. Yes, we would look for clues about what factors might affect our energy levels. Can anyone give me an example of a hypothesis we might form around this question?’ Again a sea of hands. ‘We are most energetic when we have between 9 and 10 hours sleep,’ one boy shouts out. ‘We are more energetic when we exercise regularly,’ another offers. A few more hypotheses are suggested before the teacher moves on. ‘Okay, so let’s take “Children are most energetic when they have between 9 and 10 hours sleep” as our hypothesis. How would we test that?’ ‘We would get two groups of children...’ ‘And what are those groups called?’ Mrs Coney interrupts. ‘The control group and the experimental group,’ the boy confirms. He is allowed to continue. ‘… and we would make sure that everything they did is the same apart from the amount of sleep they have. So they would be given the same food and drink, they would do the same amount of exercise, and so on, but one group would get between nine and 10 hours sleep and the other group would only be allowed, say, eight hours sleep.’ ‘Well done,’ Mrs Coney applauds. ‘And then what?’ The boy looks back blankly. ‘After a while we would run a test to see what happened. Like, after three weeks, we could get them to do a variety of exercises and see whether the control group is slower than the

experimental group,’ another child offers. ‘Very well done,’ said Mrs Coney. ‘And then we would tell other people what we found. And why is sharing our findings important?’ ‘Because other people might find them interesting?’ ‘And it might encourage someone else to run other experiments about other aspects.’ ‘Both are correct answers, yes. And, one other reason is because scientists like to test other scientists’ findings to verify them. If four different groups of scientists test the same hypothesis and all find that nine to ten hours sleep results in peak performance for children, then it is considered more valuable than if only one test has been done.’ Mrs Coney points to the board. ‘This scientific method is very useful. But there are three common reasons why people end up with the wrong conclusions.’ She holds up her forefinger. ‘Firstly, we might use our observations incorrectly. For example, let’s say that someone in our control group is first to complete the running test. We might use this information to conclude that sleep doesn’t affect energy levels. However, that person might be our school’s best runner who has practiced running for years and the only person who did better than the experimental group.’ Mrs Coney makes a two-fingered peace sign. ‘Secondly, we might listen to others who we feel know more than us. A simple example of this might be if I told you that much research has already been done on sleep and that we know eight hours sleep is the optimal amount of sleep for a human being. I might even tell you that there are studies proving this in the British Medical Journal. Because of this, you might decide that there is no need to test your hypothesis. The problem is, I was telling you about research done on adults not on children. So, if you listened to me, you might not have the right answer.’ She holds up her three middle fingers like a Scout salute. ‘Thirdly, and this is a very common mistake, is coming up with the answer you want to hear. I’m sure some of you would like to stay up late on school nights so you might come to the conclusion that seven or eight hours is the best amount of sleep for a child!’ Scarlett shoots Pen a worried look. ‘I think we might need to do some more baking,’ she whispers.

‘I don’t think the feedback we got from our neighbours was as good as we thought it was,’ Scarlett huffs as the girls are walking home, dragging her shoe along the pavement. ‘Did we fall for all of Mrs Coney’s three reasons for getting to the wrong conclusions?’ Pen fires back with a grimace, insinuating they did. ‘People said they liked everything we gave them,’ Scarlett replays, ‘but that might just mean that they liked us because that’s what adults do. They say things they think will make us happy.’ Pen makes the motion of drawing a tick in the air. ‘So we might well have used observations incorrectly.’ ‘We also said that we were going to spend time and money making everything look nice because Mrs Pease at number 22 said that was important,’ recalls Scarlett. ‘Which might not be true.’ Pen makes another tick in the sky. Scarlett raises here eyebrows. ‘And what was our conclusion?’

‘That. Everybody. Will. Buy. Our. Cakes!’ the girls chant together. ‘Oh poo,’ Emily giggles. The others start laughing too. ‘Come on,’ Scarlett urges. ‘Let’s go to our HQ and get a new plan.’

5 THE FIRST QUESTION

‘That’s why people saying they would buy our products isn’t a scientific test.’ The girls have tried their best to explain the situation to Emily. ‘All our previous test did was make us feel good. But it didn’t really prove anything.’ Emily still doesn’t understand but she’s not going to let on. ‘So, what are we going to do now?’ she asks. ‘We are going to work out what questions need answering. That’s step one: decide on the questions we want to know the answer to.’ Emily looks at her big sister. ‘So, what are they?’ She grabs a piece of paper, designating herself as the scribe for the session. Thoughtful silence. Emily looks at the girls in turn, eager to write. More thoughtful silence. ‘Are decorations really necessary?’ starts Scarlett. Emily slowly writes it down in her best joined-up handwriting. Pen desperately wants to take over because she considers Emily too slow but is feeling kind so she holds back to give her sister the opportunity. ‘Do people want to see ingredients that have been locally sourced?’ adds Pen. ‘What food and drink will be most popular and will people buy?’ ‘Will people want drinks and food?’ ‘What will increase or decrease sales?’ ‘Some people care about the amount of sugar in things.’ The girls continue writing down as many questions as they can think of. ‘Do you think we’ve got enough?’ Pen eventually questions. Emily has done a very good job of keeping up with the big girls and has written all their questions down. Pen reads the list, not pointing out the phonetic spelling mistakes her little sister has made, such as ‘Shugar’. ‘So, what do we do now?’ asks Emily. Scarlett and Pen look at each other. ‘Step one is to ask a question,’ they chant together. ‘But you’ve just asked a whole page full of questions,’ Emily highlights. ‘Yes. And we need to pick just one of them to begin with,’ clarifies Scarlett. ‘So, which do we think is the most important?’ After some discussion, they settle on:

‘What food and drink will be most popular and will people buy?’

‘Step one … completed!’ officiates Emily triumphantly. ‘What’s step two?’ ‘Step two is to gather information about the question,’ Scarlett advises. ‘Like a detective,’ adds Pen. The girls look blankly at each other, then shift their gaze to the ground. ‘This is harder than I thought it would be,’ confesses Pen. ‘We can do this,’ encourages Emily. She might be little, but she’s determined. ‘Okay,’ Scarlett presses on. ‘So, when the fair came to the village last year, it sold candy floss, cold cans, hot drinks and doughnuts. What other events have we been to that we can think of?’ ‘Em and I went to a racecourse with our parents and some of their friends recently. They sold hot dogs and burgers. As well as all sorts of drinks at different stalls. But they were fixed stalls in a venue that was used regularly, so it was quite different.’ ‘Where else?’ ‘School fair?’ proposes Emily. ‘Yes. Good one,’ encourages Pen. ‘They also sold hot dogs and burgers like the racecourse. But there was also a cake stall. What did they sell?’ Before Pen can start reeling off the cakes, Em jumps in. ‘A reeeeaallly good chocolate cake!’ ‘And a carrot cake. And a few tray bakes,’ continues Pen. Scarlett has taken over the writing duties as Emily’s interest has waned. ‘They had plates and forks, as well as tables and chairs for people to sit at.’ The girls continue to consider other events they have attended, noting down what offerings each had, but also the facilities available, the types of people attending the event, what kind of venue it was, and so on. ‘I think we should move on to think about the people who come to the fun run. What do we know about them?’ directs Pen. ‘They usually know someone running,’ Emily begins. ‘They are standing around for quite a long time,’ continues Scarlett. ‘And most of them stay for the whole race as they want to see the person they are supporting cross the finish line. And it’s probably quite boring for them.’ Pen joins in. ‘Some of them may bring snacks with them but they probably won’t bring cutlery or plates with them.’ ‘Good. Good,’ says Scarlett, struggling to write down all the thoughts streaming out of their heads. ‘Let’s keep going…’

6 THE HYPOTHESIS

‘So we’ve asked a question and gathered information about the question like a detective,’ clarifies Emily. ‘What next?’ ‘Next is to form a hypothesis’, declares Scarlett. ‘What’s a hypososus?’ asks Emily. Pen laughs and jumps in to explain. ‘Not a hypososus. It’s not a dinosaur.’ Emily feels a bit embarrassed but doesn’t let on. She repeats ‘hypososus’ to suggest she was being funny. ‘A hy-poth-e-sis,’ Pen explains, pronouncing the word very slowly, ‘is a guess of what you think will happen in a certain situation. You then need to run experiments to find out if your hypothesis is correct or not.’ ‘Like “People watching the fun run will want to buy snacks that they can hold in their hands”?’ proposes Emily. The other two girls stare in disbelief. ‘Er, yes, exactly like that,’ Scarlett replies. Pen pats her little sister on the head, then grabs her and squeezes her tightly. ‘Well done.’ Emily smiles as best she can with her big sister squishing her face in the cuddle. ‘And what about “People watching the fun run are more likely to buy something if we offer both sweet and savoury snacks” as another hypothesis?’ Scarlett asks. ‘They sound like two very important hypotheses to me,’ agrees Pen. Scarlett underlines them both. ‘Hyposaurus. Grrrr!’ laughs Emily.

‘Now we get to the really exciting bit, Em,’ explains Scarlett. ‘We are going to test our hypotheses.’ ‘Grrrrr!’ ‘Quite.’ ‘So now we have to think about how we can test these,’ Scarlett says, holding up the sheet of paper with two statements written on it.

People watching an event will prefer to buy snacks that they can hold in their hands

People watching an event are more likely to buy something if we offer both sweet and savoury snacks

‘We need to test them in a way that doesn’t allow our thinking to be swayed,’ Pen asserts. ‘We want to make sure that the information we get is used correctly, not just to prove what we want it to prove, and we must be careful not to take what adults say without testing their statements.’ Scarlett nods and add, ‘We should also think about how to use a control group alongside our experimental group.’ The girls try to explain this last point to Emily. ‘A control group is a bunch of people in our experiment who don’t receive the thing we are testing. We then compare how their actions differ from the group we do give the thing we are testing to.’ The three girls sit contemplating the idea for a while. Emily finally breaks the silence. ‘So, like, we could offer some people only sweet snacks to choose from, but offer another group of people both sweet and savoury snacks?’ Again the older girls are impressed. Pen rewords the suggestion. ‘Yes, we could offer the control group just sweet snacks, but the experimental group has the option of both sweet and savoury snacks.’ ‘I think that would tell us if the second hypothesis is true,’ Scarlett muses out loud. ‘If the experimental group takes more snacks from us, then our hypothesis is true: people are more likely to buy something from us if we offer both. Yet, if there is no difference in the amount of snacks eaten by both groups, then our hypothesis was false.’ ‘And if we make a mixture of easy-to-hold snacks and not-so-easy-to-hold snacks then we will test the other hypothesis,’ concludes Pen. The girls settle down to draw up a shortlist of snacks that will enable them to run their tests. ‘Sausage rolls and tuna pasta, brownies and slices of a chocolate cake…’

‘Before we start making all these snacks, we should think about how we’re going to actually run our tests. Last time people swayed our results because they were trying to be nice to us.’ Pen looks at the others determinedly. ‘What if we don’t ask them whether they would buy from us? What if we offer them two options. For example, a chocolate brownie or a piece of chocolate cake?’ suggests Scarlett. ‘Or a brownie or a sausage roll.’ ‘And then ask them specific questions about the one they ate,’ Pen adds. The girls throw around a few ideas of how to run their tests. They establish that the best candidates would be people already outside their houses, such as a parent watching their child playing in the front garden. But, failing that, they will ask them to step out onto their driveway and imagine the scenario and ask: “If you were out here watching your child on their bike for 30 minutes, and we came up and offered you [snack 1] or [snack 2], which one would you take from us? You can’t have both! You can choose neither though.” This, they decide, makes the results more meaningful. They aren’t asking subjective questions, such as ‘Do you like these snacks’ or ‘Would you like more or less decoration’. The facts should speak for themselves: one snack will be chosen, one won’t. Or neither will be

chosen, but they think that’s unlikely as they’re not even asking for any money. Who turns down free food?! ‘We could then ask some other questions that might give us some useful information,’ suggests Scarlett. ‘Like “What is the best thing about that [product]?” and “If we were to make that [product] even more awesome, what could we do?” I know it’s subjective, but we might learn something from their answers. We can always choose to ignore their answers.’ ‘Let’s do it.’

A Hypososus

7 ROUND ONE

They make small batches of various snacks. They have tried to keep the options limited, but also make them similar to each other: a chocolate brownie and a chocolate cake; a lemon biscuit and a lemon cake. One easy to hold and consume; the other really requiring a plate and some sort of utensil. With the snacks ready, the girls venture out. Luckily, one of their neighbours, Sam, is in her garden with her young son. He’s a cute toddler that the girls love playing with and he beams up at them when they arrive. Their gorgeous dogs, Enzo and Truffle, run out to greet them too. ‘Hi Sam,’ the girls call enthusiastically. ‘Do you have a minute?’ Emily is distracted by the dogs. She longs for the day she can have one. The older girls call her to pay attention to the job in hand. They run through their script as planned, offering Sam the choice of a brownie or a slice of chocolate cake. She takes the former. Her son reaches up towards his mother hopefully and is rewarded with a torn off piece of brownie. ‘If we were to make that brownie even more awesome, what could we do?’ they follow up. Sam thinks for a minute. ‘Add more chocolate chunks, I think.’ ‘And what was the best thing about it?’ ‘It was slightly chewy. Brownies are often dry but that one was nice and moist.’ ‘Thank you, Sam.’ ‘Thank you, girls,’ she replies. Test number one concluded! ‘Right. Who else can we find?’

‘Let’s review our findings then,’ pants Scarlett after they’ve run back to HQ. ‘I think we found that our hypothesis “People watching an event will prefer to buy snacks that they can hold in their hands” is true,’ declares Pen. ‘Hardly anybody went for things like a slice of chocolate cake. Even when we offered them a plate and a fork.’ ‘Right,’ confirms Scarlett. ‘Right,’ chips in Emily. Emily is loving every moment of being in the ‘Snack Club’ as she is calling it. The name isn’t gaining traction but that doesn’t deter her from using it. The older girls aren’t stopping her

so she’s just carrying on happily. Time with Pen and Scarlett is all she wants. They’ve even let her keep the tally of which snacks people chose. Pen did most of the talking. Scarlett wrote down the answers about what people liked most about the snack and how they could make them even better. ‘But I’m not sure we tested the other hypothesis, that people are more likely to buy something if we offer both sweet and savoury snacks; everyone took something from us!’ clarifies Scarlett. ‘I think we might be at risk of falling into Mrs Coney’s using-observationsincorrectly trap if we declared that hypothesis true or false.’ ‘Yes,’ agrees Pen, ‘and maybe falling for the coming-up-with-the-answer-you-want-to-hear trap too. So, what else did we learn?’ Scarlett studies her notes. She used her new pen—which is rainbow coloured with a unicorn sitting proudly at the top—which she thinks makes her writing look very grown up. ‘Maybe we should put more chocolate in the cupcakes and the brownies?’ she questions. ‘It was feedback from a few people. And a few people also said that decorations were important too.’ Pen looks concerned. ‘What’s the matter?’ asks Emily. ‘What if our neighbours are still just being kind when they eat our cakes? What if they actually think they’re all horrible but are just being nice? What if “you could put some more chocolate in them” really means “you NEED to put A LOT more chocolate in them to make them even BEARABLE”?!’ she rattles off with a hint of panic. ‘What if everyone laughs at us because the cakes look ugly?’ ‘Don’t worry, Pen. The point of this test was to test the hypotheses we wrote, remember? The other feedback was just a bonus. But it needs testing before we act on it.’ The three girls agree that they should put their normal high standards aside in order to learn. It’s tough to hear criticism, even if framed positively. It isn’t helping their morale. ‘I suppose it’s better that we find out the truth early before we invest our pocket money in the wrong ingredients,’ Pen concedes. Scarlett gives her an encouraging hug. ‘Right. We don’t want to create snacks that nobody wants! That would be such a waste of our time, pocket money and effort.’ ‘Come on then. What else did we learn?’ Pen stands up. ‘That we should only test one hypothesis at a time?’ suggests Scarlett. ‘I think we made it really hard on ourselves by trying to test two at once. I’m sure Mrs Coney didn’t suggest we test more than one.’ ‘Good. What else?’ ‘That creating small batches of snacks was a good idea,’ states Scarlett. ‘Why?’ asks Emily. ‘Now we’ve got to bake more before we can test again. And we don’t have any left over to eat!’ Scarlett laughs and agrees that it would be nice if they had some to eat right now. ‘Well, we only used up a small supply of our ingredients for that test and we made them quickly. It took us as little effort as possible to test our most important hypothesis.’ ‘Also, there would be no benefit of us having those same snacks for the next round of testing because we probably want to test something different, such as the amount of chocolate in the brownies and the need for decorations,’ huffs Pen who is not completely over the earlier feedback.

8 ROUND TWO

‘We only have two weeks before the fun run,’ reminds Pen. Everyone is fully aware of this, but she felt as though she needed to say it. ‘Okay,’ Scarlett replies calmly, ‘so let’s think of our next important question.’ ‘How about “will decorations increase sales of our snacks?”’ Scarlett contemplates the suggestion. ‘How about we make the question broader: “what will increase the sales of our products?”’ The girls gather information around this question, considering aspects such as appearance, ingredients, calories, advertising, the weather. Although they don’t have control over the last one, they decide to include all factors regardless of whether they can control them or not. ‘Now it’s time to form a hypothesis,’ Scarlett finally declares. Although there are many, the girls settle on “The cakes need to look beautiful in order for people to buy them.” ‘So, how can we prove or disprove that?’ From their previous test, they identified which products were more popular than others. For example, the cupcakes and cookies were equally popular, but both were more popular than a simple tray bake. ‘What about seeing if decorating unpopular cakes makes them more popular? For example, will a decorated tray bake outsell the previously more popular cupcake?’ ‘And we could see whether decorated cookies suddenly start selling better than undecorated cupcakes, and the other way round.’ The girls hit the kitchen again. Sarah is happy that the girls are engaged in something together, as it means she can get on with some other tasks. Even if it looks like her kitchen has been napalmed when they’ve finished with it. Remembering their earlier lessons, the girls make small batches of products to test. This leaves them flexible for trying different products without wasting ingredients. While the older girls are busy mixing and lining baking sheets with parchment, Emily is busy scribbling on a piece of paper. ‘What are you doing, Em?’ asks Pen. Emily proudly reveals a list of cakes in a two-column table: one column has the cakes’ official names while the right-hand column has a name that Emily feels will be more fun. ‘Flame Fairy Cupcake,’ giggles Pen. ‘Love it.’ Although Pen has her doubts about these fancy names, she knows that it will be easier to go along with her sister’s suggestion. ’Can’t do any harm’, she whispers to Scarlett.

Scarlett wrinkles her nose and shrugs her shoulders in compliance. Their tests are focused around a simple measure: which products people choose. Cleverly, the decorated and undecorated products can be switched around to try different combinations. The levels of decoration vary, from simple icing and a cherry to a monstrous combination of buttercream, sugar decorations and a sparkler. The baking equivalent of a child in a beauty pageant. They pack their test material in plastic containers. Scarlett produces some rainbow ribbon to tie around the sides of the boxes. After another half an hour of decorating their equipment, they set off.

‘That was amazing,’ sighs Scarlett as she sinks into a bean bag in the HQ. All three girls are exhausted, but they are also excited from their latest test. There is so much to think about and record. Scarlett grabs her notebook and opens it to a fresh page. ‘Noooooooooo!’ she screams, pulling a broken unicorn pen from her pencil case. It has a crack running the full-length of the unicorn’s head, with a number of shards that have come loose. Everyone keeps quiet for a while until Scarlett is ready to move on. She pulls a simple blue ballpoint from her case and looks at the others, trying not to think about the situation. ‘So what have we learned today?’ she asks. ‘That we don’t need to spend too much time making things look beautiful; looking nice is good enough,’ Pen replies matter-of-factly. ‘And my fancy decorations of the box and other stuff was a waste of time and effort too,’ Scarlett confesses. ‘Nobody cared about that or even noticed it.’ She doesn’t seem upset about it and Pen is so glad that she didn’t have to bring it up herself. Unfortunately, she doubts that Emily has the same self-awareness of the pointlessness of her cute-sounding cakes. Does she tell her and risk crushing her? No. Some things aren’t worth the grief. She will have to broach that another time. Emily sits colouring in a picture of a fairy, oblivious to her sister’s thoughts. ‘Do you think we should continue?’ asks Scarlett. Pen is shocked. What is Scarlett suggesting? Does Scarlett think they are wasting their time and should stop? This would break Pen’s heart. Her tummy has a sinking feeling. ‘Stop? Do you think we should stop? Don’t you think today suggested we are onto something?’ ‘Sure. I was just checking that you agreed.’ Pen is relieved. The funny feeling in her stomach dissipates. After some further discussion, Pen and Scarlett come to a conclusion: simple decorations are sufficient; they won’t waste any more time on pointless details. Emily finishes her colouring. ‘So, what about the other Hypososuses?’

9 ROUND THREE

Although there are lots of other factors they’d like to investigate, the girls know there is limited time. ‘The importance of local ingredients?’ ‘Hmmmm’ ‘Calorie content?’ ‘Naaah’ ‘Marketing?’ ‘YES! That’s one thing I think we should look into.’ The girls only have one weekend left before the fun run in two weeks. So, realistically, that means one or maybe two occasions to test more hypotheses. ‘Advertising will increase sales is something I think we should test,’ agrees Scarlett. This still falls under their wider question of “What will increase the sales of those products”, but they agree that it has more value than customer opinion on local ingredients or calorie content. ‘So how can we test this?’ ponders Pen. ‘Is there anything happening in the village next weekend?’ The girls sit there in silence, scanning their brains. Nothing. ‘We need something that a group of people will go to. And that we can market to some people, but not others. It doesn’t need to be as large as the fun run; just something with a bunch of people.’ ‘Like the football match on the green?’ Emily pipes up. The older girls had almost forgotten about Emily colouring in the corner. She’s not even broken her stride in colouring while giving her brilliant suggestion. They look at each other in astonishment then laugh. Emily looks up. ‘What?’ ‘That’s a brilliant idea, Em. That’s what!’ A smile stretches from one side of Emily’s face to the other. Half an hour later, the girls have their plan. ‘So, we will find out who they’re playing, then find a way to advertise to half the people attending,’ summarises Scarlett. ‘The group we don’t advertise to will be the control group and the people we do advertise to will be the experimental group, right?’ ‘Right,’ says Pen.

‘Right,’ says Emily, although she still doesn’t understand what the girls are talking about. ‘Shall I get the felt tips?’ Just over an hour later, the girls have a very colourful A4 drawing explaining that they will be supplying refreshments at the football match on Saturday. They scan it in, print four per page, then cut them out neatly. Luckily, the local team’s opponents this coming weekend are from the neighbouring village, meaning the girls have access to their potential market and know many of them personally. The two older girls split out the work of distributing the flyers to a mix of local people and visitors. It would be no good having the control group all from one village, as this could easily skew any results.

Cupcakes, flapjacks, tray bakes and other tasty treats are prepared over the coming week and carefully stored away in anticipation. By the time Saturday arrives, the girls have wound themselves up into a frenzy. They head off to the local park on their bikes, having carefully stored the boxed products in their baskets. They haven’t bothered with unnecessary decorations on the products or on the boxes. Simple and tasty is the innate message this time. As the final whistle is blown, both the local team and the girls are buzzing. A definitive win for both. ‘That was a-mazing. And we sold loads!’ Pen declares excitedly. Scarlett and Emily jump up and down screaming and Pen joins in. ‘I think that proves advertising had a positive impact,’ Scarlett pants once they stop leaping around. ‘Yes, the people who had received a flyer definitely bought more often than those who didn’t. Many people who didn’t receive a flyer brought their own stuff, whereas some of the flyer recipients said they deliberately didn’t pack food because they knew they could get it here.’ ‘Shall I get the felt tips out when we get home?’ asks Emily. Pen pats her sister’s head again. ‘Yes, I think you should.’ ‘And we should think about how we tell everyone coming to the fun run about our cakes and bakes. That is not going to be quite so easy as we don’t know who will be coming,’ huffs Scarlett. The girls gather their remaining products, load them onto their bikes and start to pedal home. ‘But someone must,’ mutters Scarlett. ‘What?’ ‘Someone must have a list of all the runners,’ Scarlett clarifies. ‘The people organising it must have a list of the people who will be running. They’ve paid a fee to do the run, so the organisers will probably be emailing them with details about the run. What if we could get a mention in an email to the runners?’ ‘Brilliant. You’re so clever Scarlett.’ The girls start pedalling faster.

10 THE FUN RUN

‘Scarlett?’ ‘Scarlett?’ ‘Scarlett?’ Sarah huffs in frustration. It’s a normal school morning. Although Scarlett can hear a packet of biscuits opening from two-hundred feet or a swear word that leaks from her mother’s mouth on a private phone call, the nine-year-old’s hearing seems to develop issues when getting ready for school. ‘Scarlett! I’ve had an email I think you might be interested in seeing.’ A thunder of footsteps hurtles down the stairs and Scarlett is next to her mum within seconds. ‘Yes, mum?’ Sarah points at her laptop. It’s from the race organisers. ‘Thank you for your email … blah blah blah … first run in the village … blah blah blah … we are not providing refreshments … WE WOULD BE HAPPY TO MENTION YOU IN OUR NEXT EMAIL.’ Scarlett looks at her mum in surprise. ‘I didn’t think they’d do that, mum. I thought they’d have some health and safety or other boring reason not to do it.’ ‘So did I,’ agrees Sarah, smiling. ‘Obviously you’ve found someone who recognises a promising entrepreneur when they see one.’ ‘Can I go and tell Pen?’ she shouts, grabbing her coat. ‘After you’ve brushed your …’ The front door slams before Sarah manages to finish her edict.

Although they happily went to bed early, each of the girls finds it difficult to sleep on the night before the fun run. They have been baking in every spare moment over the last few days. Now there is nothing more they can do. Pen has laid out her clothes: a dress with black and white stripes at the top and a floral pattern underneath. In the morning, she is busy putting her hair in a plait crown while Emily chooses what to wear. Jess has helped Emily pick out a purple t-shirt with a unipig design—a pig with wings and a horn—and a silver glittery skirt. Scarlett is waiting patiently downstairs, wearing her standard

uniform of cropped trousers and a t-shirt. Jess and Sarah have arranged for the girls to have breakfast together; it would be a nightmare containing their excitement otherwise. As expected, the noise over breakfast is deafening. Pen keeps asking everyone how much they think they will sell. The advert about their stall in the email to runners was brief, but she hopes that it means people remember to bring money along to buy their goods. Scarlett is focusing on who else they will see from school. Will their teacher be there? She’d like that. Emily is simply wondering whether they will be rich by bedtime. The adults wisely leave the girls to it.

After helping Sarah load a wooden table into the boot of her car, the girls fasten their cakes and bakes to their bikes and set off. Posters and signs to direct runners are littered throughout the village. With each one, the girls’ excitement increases. They reach the park and, despite it being well over an hour before the race is due to start, they are faced by a mass of people. Sarah arrives shortly after and helps them set up their stall. Within minutes they have a few boxes laid out and people are already showing interest. Surprisingly, not all runners rely on energy bars; flapjack seems to be a happy alternative for many. It doesn’t get any quieter once the race starts. The customers just change. Fairy cakes and brownies overtake flapjack in the popularity stakes. ‘I’m sorry, we have sold out of brownies,’ Scarlett says after an hour. ‘We still have a few fairy cakes and fork biscuits left.’ They don’t for long. Well before the race has finished, the girls are packing up the table and helping Sarah put it in her boot again. ‘I cannot believe we sold everything,’ Scarlett beams. Pen and Emily smile back.

11 THE FUTURE

‘Yes, we sold everything. That was our main focus. But what else?’ ‘We had fun making the cakes and bakes.’ ‘People seemed happy to pay the prices we charged.’ ‘Nobody complained.’ ‘We had products that both runners and watchers bought.’ The girls are already planning what to do next, so have followed Sarah’s suggestion to consider what went well and what they could improve upon in the future. ‘People were disappointed that we didn’t have any drinks.’ ‘Yes. They were pretty thirsty after that chocolate brownie!’ ‘There was water from the main tent though.’ ‘And making hot or cold drinks makes things a lot more complicated…’ Sarah enters Baking HQ with the village magazine. ‘You might want to look at this, girls.’ They scan through the first part of the article. Then they see it! The run was enhanced by a pop-up cakes and bakes stall, provided by three students from the village primary school. Scarlett Moretti, Penelope and Emily Blades supplied homemade tray bakes and biscuits … but my favourite was their wonderfully gooey brownie. We hope to see them at future events.

Pen and Scarlett are overjoyed. Their original goal was to feel part of the community. ‘I really want to do it again!’ pleads Scarlett to the other girls. ‘I am so in,’ replies Pen. ‘Me too,’ agrees Emily. ‘Maybe we could run a stall at other village races?’ proposes Pen. ‘Great idea,’ approves Scarlett. ‘Em, pass me a piece of paper please.’ ‘Would you like Unicornio as well?’ the younger girl asks. Scarlett's face drops as she remembers her beloved broken unicorn pen, then lights up when Emily passes her a brand new one. But…?’ Emily cuts her off. ‘I found two in the corner of the village shop. One for me, and one for you.’ Scarlett leans across and grabs her for a massive cuddle. ‘Thanks. You’re a great business partner.’

PART 2

THE ESSAY

The world of creating products and services is unpredictable. It is complex: cause and effect can only be understood in hindsight, if it can ever be understood. Experts can add suggestions but cannot tell you the right answer. Bob’s story A few months ago I was in a bar with Bob and Mary. Turning to me and Bob, Mary said, ‘I’ve known both of you for quite a while, but I still have no idea what you do. You do something similar, right?’ Bob quickly jumped in to offer his explanation: ‘Well I was born with a gift,’ he began. ‘When someone tells me their problem, I can give them the answer.’ Ptooey! I spit-take my wine across the table. WTF?!

Bob’s statement is wrong on so many levels. Firstly, we cannot know what is best for someone else; only they truly understand their situation. At best we can offer ideas, thoughts or share our experiences that occurred in different circumstances. Secondly, there is never a single answer to any problem that involves the will of another human being. Therefore, the only sensible approach in such unpredictable environments is to try something, see what effect it has, then adjust accordingly. Perfect partners ‘Working software over comprehensive documentation’ 1 ‘Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.’ ‘Working software is the primary measure of progress.’ ~ excerpts from the Manifesto for Agile Software Development

Complexity and Agile are perfect partners. The Agile Manifesto encourages us to use an iterative and incremental approach to fulfilling customer needs, rather than creating extensive, stagnant, fixed plans. Getting something into the hands of real users beats a pile of documentation hands down. But sometimes people interpret Agile as output-focused. Outputs are tangible features, products or services that we create. They are working pieces of software, a signpost, a widget. But we don’t succeed by just creating output. For example, if we create a marvellous new music service, but nobody uses it, that is not success. Value to our customers is measured by ‘the human behaviours that drive business results’ (Josh Seiden 2), such as people subscribing to our music service. These are outcomes. Outcomes include increasing subscriber rates, reducing the drop-off rate at checkout, increasing the number of items per transaction. In summary, value, and therefore our success, is judged by whether the outcome is achieved, not on whether output is achieved. Agile is not output-driven, it is outcome-driven. How to achieve outcomes Our hope is that our outputs result in the desired outcomes. Good teams break work into smaller development cycles and release ideas to market regularly. This has the double benefit of testing whether their solutions (output) achieve the value they desire (outcome) and it enables them to capitalise on value earlier, for example, increasing subscriber rates. But great teams do this by explicitly testing hypotheses. They start by agreeing the desired outcome (e.g. increasing subscriber rates), then run tests to see if their outputs move them towards this goal. They understand that it is impossible to be sure whether a certain feature will cause the desired outcome because they are operating in a complex world. There are different formats but the general approach is something like: ‘I think that, if we release the new share-my-music feature, our subscriber rates will increase by five percent.’ They then judge whether the output results in the desired outcome. They can then adjust that output or try another idea (another output) to see if that causes more of the desired outcome. That is iterative development being led by hypotheses-led learning. The two types of failure There are two possible results from any hypothesis: proven correct or proven incorrect. By their very nature, hypotheses must have the possibility of being incorrect (i.e. failing). When a hypothesis is proven correct, we achieve the desired outcome; when proven incorrect, we achieve learning. Both should be considered positively. Both equate to success. It is important that teams feel safe with the possibility of this kind of failure. The catchphrase ‘Fail fast, fail often’ is used to instil this sense of permission and safety. But it’s misleading because, to the uninitiated, it can sound like failure is a goal. Or that every type of failure is success. Failure in itself is not good. Failure that results in no learning is bad 3. What ‘fail fast, fail often’ really means ‘learn fast, learn often’.

The scientific method’s use of hypotheses is a structured way to learn. It is specific about what the area of learning will be. It should eliminate failure without learning. Hypotheses have the benefit of holding us to account: frivolous requests should no longer edge their way into our work queues. If they do, they will be identified as such when they deliver no value. Time to move on At some point, the available rewards—of either outcome or learning—are no longer sufficient to warrant more investment (of our time, effort, money). At this point we should stop and move our focus to another outcome. This sounds obvious, but you’d be surprised how hard it is for individuals, teams and organisations to do. They’ve become wedded to the outcome. They need encouragement to move on. Fortunately, using hypotheses will help you do this because you’ll be explicitly identifying the desired outcome each time. Summary Releasing pre-determined ideas (as if you’re in a predictable world) is not agile ... regardless of whether you are cutting the work into small development cycles and releasing it to your customers in tranches. More than not being agile, it is madness doing this when you are operating in a complex world. Hypotheses will help you focus on outcomes, not outputs, and you will be more rigorous in your approach. What’s next? Now it is time for you to dig a bit deeper and think about how you might apply this to your work. The following pages are a mixture of exercises to cement your understanding of the scientific method, provoke inquiry into your current ways of working, and provoke disruptions in your current ways of thinking… 1 You can replace ‘software’ with whatever product or service you are making and it still works. To read the manifesto in full, see Beck, K., Beedle, M., van Bennekum, A., Cockburn, A., Cunningham, W., Fowler, M., … Thomas, D. (2001). Manifesto for agile software development at http://agilemanifesto.org/ 2 Seiden,J. (2019). Outcomes Over Output: Why customer behaviour is the key metric to business success. US: Sense & Respond Press. 3 Eddie Obeng uses the terms ‘dumb failure’ and ‘smart failure’: dumb failures refers to those that could have been avoided by using prior knowledge; smart failures happen when trying something new and learning. For more, see Eddie Obeng’s blog post http://imagineafish.blogspot.com/2017/11/design-and-innovation-in-changing-world.html

PART 3

THE EXERCISES

The following pages contain a collection of thought- provoking questions, scenarios and problems. Please keep the following in mind: You can answer them in any order Some of them might not be applicable to your situation; just skip over them There are no right answers My suggested answers (e.g. in the scenarios) are not the ‘best’ answers; they are just there to lead to another question If you find the questions about yourself/your product or service easy, then you probably aren’t thinking about it enough This should be fun Discussing your answers with your colleagues might bring you an even deeper understanding about your situation Are you ready? If yes, turn the page. If no, close the book and do something else (but come back at some point).

THE ANSWERS

Most of the exercises don’t have a simple, single answer so the only way to validate what you have written is to discuss them with others. Maybe start a discussion group in your organisation or in your local town? But some do have more definitive answers and they are:

Mrs Coney’s Warning Mrs Coney warned of three potential mistakes when answering questions. They were: 1. Using observations incorrectly 2. Listening to others who we feel know more than us 3. Coming up with the answer you want to hear.

Outcome or Output? Outputs are tangible features, products or services that we create: Writing a blog post Launching a podcast Creating an advert Releasing a new website The production of a car Composing a symphony Outcomes are the changes to behaviour that occur: Changing the way people choose a bottle of wine

Increasing subscriber rates Reducing complaints Selling more of our product Getting people to drive more carefully

Think of an output If we wanted to change the buying habits of a bar’s customers, there are many, many outputs we could try. For example, we could: Provide special offers around certain drinks Increase or reduce the range of certain drinks Provide loyalty programmes (e.g. buy 9 drinks, get the 10th for free) Advertise certain products Recommend certain drinks (especially when matching with food) Offer local products Train staff in certain products, so they can discuss the drinks expertly with customers Serve drinks in branded glasses Offer free salted snacks to encourage drinking Invite people to tasting events (such as wine or whisky)

Facts vs Assumptions Increasing prices will reduce footfall Assumption: There is no way of knowing this. Gaining a liquor licence will result in an annual fee Fact: In the UK, there is an application fee and an annual fee for a liquor licence. Longer opening hours increases staff costs Fact: As most catering staff are paid by the hour, this is most likely a fact. Top grade coffee beans will increase coffee sales Assumption: There is no way of knowing this. Maybe Deliziose’s customers aren’t coffee connoisseurs. Expanding our menu will increase waste

Assumption: Although adding items to a menu that involve a lot of fresh items is likely to increase waste, this is an assumption because it could cause an increase in those fresh food sales. Also, maybe the increased range is made up of long-life items, such as canned drinks, alcohol or packets of biscuits. Negotiating lower costs with suppliers will increase profits Fact: Assuming you are still receiving the same quality of goods for the lower price, this will increase profits.

Data collection Number of customers coming in between 07:00 - 08:00 Number of customers coming in between 18:00 - 19:00 Knowing how many customers come into the deli during the extended hours would be useful to know, especially when used with... Total number of customers This is definitely useful data: if the total number of customers stays the same, but they are just spread across the extended opening times, this isn’t good for profit (although it might make happier customers). Happiness ratings of customers A grey area: difficult to measure accurately, could be influenced by multiple factors and not necessarily related to the experiment. However, we should never ignore our customers’ happiness! Number of positive reviews received Although easier to quantify than customer happiness, this is probably the least relevant data because it too could be affected by multiple factors and doesn’t clearly relate to the experiment. How much customers spend before 08:00 and after 18:00 Tied in with the other data, this would be useful. Items bought by customers before 08:00 and after 18:00 It may be useful to know what customers are buying during the extended hours, so the deli can focus on those products more (to increase sales, reduce costs, reduce waste, etc.)

WANT PRINTED EXERCISES? NEW! The Lemonade Stall: WORKBOOK ONLY

I love eBooks too: they are portable, can be searched easily, allow note-taking without defacing the book and are environmentally friendly. However, despite these benefits, some people hankered after the exercises in print and asked for an exercise-only version of the book. To satisfy this need, I have created an ‘exercises only’ edition that contains three sets of the exercises (so you can complete them for multiple teams and organisations). Buy now on Amazon.

A SUMMARY OF THE SCIENTIFIC METHOD

As described by Mrs Coney in chapter 4, the five steps of the scientific method are: 1. 2. 3. 4. 5.

Ask a question Gather information about the question Form a hypothesis Test the hypothesis Tell others about what you have found

1. Ask a question Identify the question that we want answered. For example: Why do we feel more energetic some days than others?

2. Gather information about the question Like a detective, we look for information that might help answer the question. For example, we could find out: what people eat how much sleep people have per day how much exercise people do per week

3. Form a hypothesis Hypothesis [hahy-poth-uh-sis], noun a supposition or proposed explanation made on the basis of limited evidence as a starting point for further investigation.

A Hypososus

Based on the information we have discovered, we form a hypothesis that we think might answer our question. For example: We are most energetic when we have eight or more hours sleep

4. Test the hypothesis Run an experiment to test the hypothesis, such as changing the conditions experienced by some people (the ‘experimental group’) but keeping them unchanged for others (the ‘control group’). For example: We measure everyone to see how far they can run in 20 minutes Over the next two weeks, people in the control group are allowed to sleep for eight hours or more per day; people in the experimental group are woken after only seven hours sleep After two weeks we then measure both groups to see how far they can run in 20 minutes

We compare the before/after results to see if there has been a difference in performance.

5. Tell others about what you have found Publishing our findings allows others to benefit from them and enables people to run similar experiments to verify our findings.

GET SOME FREE STUFF

Thank you for reading The Lemonade Stall. If you’ve enjoyed reading this book and completing the exercises, please help me reach more readers who might benefit from it by leaving a review on your favourite review site. I have put together a number of tools to help you explain why you should use the scientific method in your team and organisation, as well as some quick reference guides on how to get started. You can access these at scrumandkanban.co.uk/scientific-method. Thank you for joining me on this journey for better innovation!

ACKNOWLEDGMENTS

My appreciation goes to those who have made the book so beautiful. Isabella designed the cover image, which was then made into the covers for the paperback and ebook by Amber Akhtar and Angie from pro_ebookcovers. Amelia drew the charming illustration; Helen took my monstrously scribbled workshop exercises and turned them into something much more stylish. Belinda Griffin at SmartAuthorsLab again did an amazing job in holding my hand through the book creation, launch and publicity phases. Thank you to everyone else who has provided assistance, feedback, research and knowledge. In addition to those mentioned elsewhere, these include: Tracy Avis, Chris Fernandes, Stephan Huez, Judit Jakubinyi, Stephen Janaway, Malie Lalor, Kim Rowan, Linda Spencer, Jonathan Sun, Sarah Veall, Claudia Weiss, Esha Bakshi, Neil Killick. Many of the concepts covered in this book did not originate from my brain and have been influenced by other great authors. I’d like to especially acknowledge: Stephen P. Kramer (author of ‘How to Think Like a Scientist: Answering Questions by the Scientific Method’); Eric Ries (author of ‘The Lean Startup: How Constant Innovation Creates Radically Successful Businesses’); Alberto Savoia (author of ‘The Right It: Why So Many Ideas Fail and How to Make Sure Yours Succeed’); Josh Seiden (author of ‘Outcomes Over Output: Why customer behavior is the key metric for business success’). My family, again, has endured my tireless enthusiasm which I appreciate can be exhausting. Thank you for putting up with me and keeping me grounded. Finally, thanks to Jiten Vara, Jim Wyllie, Rafa Ribeiro and AWA who continue to be my partners in business, support network and generators of fresh perspectives.

ABOUT THE AUTHOR

David Lowe is the founder of Scrum & Kanban Ltd. He believes that everyone has the right to improve their work and personal life, so divides his time between coaching and training individuals, teams and organisations. Having worked with a wide range of clients across many industries (including Ford, Ministry of Justice, NET-A- PORTER, NHS, John Lewis, GDS, Naked Wines and Shelter), David has a reputation for introducing and evolving successful Agile environments. David has a post-graduate certificate in Business & Personal Coaching from University of Chester, a wealth of agile-related qualifications and is heavily involved in the Agile and Lean communities; he is co-founder of the London Agile Discussion Group (one of the oldest Agile meetups in London), Agile on the Bench and London Lean Coffee. His previous books are Scrum 101: The most frequently asked questions about Agile with Scrum and The Innovation Revelation: A story about how to satisfy customer needs.

ALSO BY DAVID LOWE

The Innovation Revelation: A story about how to satisfy customer needs A real-world guide to taking a customer-focused approach to creating products and services that people actually want and are happy to pay for. Written as a light-hearted fictional story, The Innovation Revelation follows Charlie Blades, a desperately unhappy IT professional struggling to survive in his job at one of the UK's top department stores. He is on the cusp of walking away from it all when he realises they've been doing everything wrong.

ALSO BY DAVID LOWE

Scrum 101: The most frequently asked questions about Agile with Scrum Based on real questions from real people in real talks, groups and workshops over many years, this book provides answers to the questions on Agile and Scrum that you want answered.