BookYol

Concept

Internal Startup

An internal startup is what Eric Ries, in The Startup Way, calls the atomic unit of uncertain work inside a company: a small, dedicated, cross-functional team set up to test one clear question, with a limited budget and agreed boundaries.

In large companies a new idea is usually cut into tasks and handed from department to department: product writes a specification, IT builds, marketing launches, legal reviews. Each handoff adds weeks and loses part of what was learned. Ries's answer is the internal startup, the smallest structure able to run the build-measure-learn loop from end to end on its own. The team has four traits. It is small, so decisions are fast. It is dedicated: its members do this as their real job. It is cross-functional, so it can build, sell and support a test without waiting for another department. And it has a clear question, written as the leap-of-faith assumptions it exists to test rather than a list of features. It works with a constrained budget, and in return it often needs permissions ordinary rules withhold, such as showing an unfinished product to a limited group of real customers. The structure is not only for products; the same shape works for a new internal tool or a pilot in one region.

A real-life example

At a mid-sized bank in Istanbul, a savings account for freelancers has waited nine months between five departments. A manager proposes a dedicated team of four, one person each from product, software, compliance and the call centre, for eight weeks and one question. Compliance approves a pilot with volunteer customers in advance, and the answer arrives in week six.

How to use it

  1. 1Give an uncertain idea one dedicated team instead of departments that each own a piece.
  2. 2Write the team's question as the assumption it exists to test.
  3. 3Agree the budget, the customers it may reach and the rules it may bend before it starts.