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Now that you've built an MVP and started testing with live customers, you will need learn rapidly from each test. The objective is to learn and iterate as quickly as possible through a Build-Measure-Learn feedback loop, using customer reactions to modify your hypotheses and MVP after each round of tests.

Build-Measure-Learn is an iterative learning framework popularized in The Lean Startup .

"Build" means having something you can test with users. This can be a product, a mockup, a wireframe; this is your MVP.

"Measure" can be quantitative via analytics, but also doesn't have to be overly quantitative. Pay attention to everything you observe during tests.

"Learn" is what you are learning from each test, and how you modify your hypotheses.

Repeat the process by feeding those learnings and insights back into a refined hypothesis, and moving the MVP testing along through the process again.

After each round of tests, determine if it's necessary to iterate, pivot, or persevere, as defined by David Cummings :

Iterate: A minor change of the current product or business model in an attempt to capitalize on a closely related market opportunity.

Pivot: A wholesale change of the current business model in an attempt to capitalize on a different market opportunity.

Persevere: Your experiments and interviews validate your hypotheses. These are the "green lights" signaling you to move forward with the current model.

6.2 Keep in mind...

Most successful companies go through multiple pivots to find PMF.

Try not to fall in love with your own ideas or fall in love with the problem.

You may need to try dramatically different ways to solve the core problem, or focus on completely different target personas.

Time and resources are best spent with wildly different hypotheses, instead of burning through the runway on a hypothesis that hasn't been validated.

6.4 If we have to pivot, where should we focus?

The Pivot Pyramid by 500 Startups is a visual guideline that's a useful guide to changes and pivots. The objective is to increase the pace of experimentation at the top layers of the pyramid, as changes here don't require changes to things below. In fact, changes at the bottom - the target customer, or the problem to solve - won't be frequent.

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Iterate, Pivot, or Persevere? - Catalyst Fund Toolkit

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Now that you've built an MVP and started testing with live customers, you will need learn rapidly from each test. The objective is to learn and iterate as quickly as possible through a Build-Measure-Learn feedback loop, using customer reactions to modify your hypotheses and MVP after each round of tests.

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The logic we use to understand the world as it is can hinder us when we seek to understand the world as it could be. Anyone who comes up with new ideas for a living will recognize the challenges this truism presents. It means that to get organizational support for something new, the designer needs to pay as close attention to how the new idea is created, shared, and brought to life as to the new idea itself.

The Normal Way of Generating Commitment...

Normally, we commit to an idea when we are rationally compelled by the logic of the idea and we feel emotionally comfortable with it. In the modern world, we focus disproportionately on the logic, assuming that the feelings will naturally follow. Analysis has become the primary tool in this regard. A logically plausible proposition, combined with supporting data, is presented to produce a cognitive "sense of proof." Hence the modern equation is: logic plus data provides proof, which generates emotional comfort, which leads directly to commitment.

The tricky thing about new ideas is that there is no data yet to analyze - otherwise the idea wouldn't actually be new. The absence of data undermines our modern commitment equation. For a new idea, the equation is likely to be: logic without data produces speculation, which results in emotional discomfort.

...And Its Consequence: an Over-Commitment to Exploitation over Exploration

No wonder so many new ideas are dismissed out of hand. Our training and experience tell us logically that ideas without data can't reach our standard of proof, and proof is the prompt for emotional comfort. We are biased, then, against new ideas - based on the way we have been trained to see the world. Moreover, our bias toward analysis makes us blind to the limitations of analytical "proof." Proof comes from the analysis of past data. But, when we look ahead, the proof is only robust to the extent that the future is identical to the past. Despite the obvious fact that the future is notoriously different than the past, the comfort generated by logic and data combined into proof keeps us continuing to exploit what we believe to be proven true rather than exploring unproven directions.

The net result is that we overexploit and underexplore. The consequence in the business world is that start-ups who are more willing to explore new ideas systematically outflank and often demolish established companies trapped in exploitation mode.

The Importance of Intervention Design

In the face of this dynamic, it isn't enough to create new products and services. Unless we also design new ways of talking about ideas and exploring the future, those product and service innovations will never be embraced by the organization and never make their way out into the world.

The problem of the absence of data in the logic + data + emotions equation means that both logic and emotions have to be exceedingly strong. Strong logic alone is not enough to generate commitment to a new idea because logic alone makes us emotionally uncomfortable. Similarly, appealing singularly to emotions makes us uncomfortable too. We know that we aren't being rigorous if we make a commitment to a new idea on the basis of emotions alone.

Thus, great intervention design requires attention to both logic and emotions - equally. Commitment is possible only when driven by a strong combination of both of them. Fortunately, the tools of design thinking, which have for many years been used to create great new ideas, can also be brought to bear on the methods of gaining support for those ideas - or what we in design thinking call "the intervention." The case of John Shuttleworth and his team at BT Financial Group (BTFG) illustrates how this can work.

Gaining Support for New Ideas at BTFG

John Shuttleworth, a member of BTFG's Executive Management Team, is responsible for Platforms and Investments. The company, Australia's largest wealth platform provider, is the wealth management arm of the Westpac Group (Australia's second largest bank in terms of market capitalization).

As of 2010, Shuttleworth had recognized that BTFG needed to transform its wealth management business. Like many other wealth management businesses, BTFG had grown both organically and through acquisitions. As a result, it had myriad, aging, and convoluted back-office IT systems to support its wealth management products. Multiple overlapping systems supported multiple overlapping products. When BTFG wanted to launch a new product or an enhanced service, the IT platform tended to be the limiting factor. As the person with responsibility for the IT platform, Shuttleworth knew things had to change.

To grow the wealth management business, BTFG needed to simplify its legacy systems while at the same time doing a better job of integrating them with the core banking IT infrastructure of parent Westpac. That was going to be tricky in at least four ways. First, it required a holistic approach. If Shuttleworth proceeded one system at a time, the change would take forever. Second, it demanded an entirely new system, unlike any that had been built before. Third, given the first two imperatives, this would also be a big project - from the outset, Shuttleworth knew the project would involve a significant multiyear investment of time and money. Finally, because of the size, importance and structure of the bank, the project would require not just the support of the BTFG function that reported to Shuttleworth, but the leadership team of BTFG (of which he was a member), the executive team of parent Westpac, and the board of directors of Westpac.

Given the magnitude and complexity of the challenge, Shuttleworth instinctively understood that he needed to use design thinking, but not just on the design of the platform. The initiative, which he came to call the Panorama Project, would demand deep user understanding and prototyping applied to both the artifact (the platform) and the intervention designed to bring it about (the process and project).

Designing the New Product

The scope of the Panorama Program was significant. Essentially the team needed to rebuild the entire product and technology architecture for BTFG's wealth products and then migrate existing customers to the new technology platform. Mindful that many large transformation programs run into difficulties because of scope complexity and traditional " waterfall" software development, Shuttleworth and the team used a design-led approach combined with scaled agile delivery. This meant that they'd focus on taking a collaborative, customer-centric, iterative approach. During early 2011, Shuttleworth's team interacted with customers of two of the key products to understand their needs. The team sketched out user stories to frame the work (see below for an example). Six weeks later, customers were shown the first low-resolution prototypes. Multiple iterations followed, to improve the product possibilities.

Building on agile methodology, revised prototypes were tested and released as frequently as possible, with input from business partners and users. The entire program was broken up into a series of releases, from managed accounts to mutual funds and retirement accounts.

Designing the Intervention

The deep user engagement, rapid prototyping, and phased, testing-oriented release were required to design a great user experience for the platform. But rather than focus entirely on improving the customer experience (the artifact), Shuttleworth knew that he had to work in parallel on the design of the invention within BTFG and Westpac. He needed both for the customers to be thrilled and for the executives of BTFG and Westpac to be confident in the approach and the outcome. As a start, he needed leaders to feel comfortable enough to invest in the new and unproven approach - and to invest a lot. Shuttleworth describes the challenge: "I knew that I would have to appeal to both their rational and emotional side...I needed to get them to fall in love with the customer experience...But in parallel, we had to do all the analytical stuff - the business case."

The first challenge for Shuttleworth was to engage his own leadership team, then the management team from BTFG, next the Westpac executive team, and finally the Westpac Board. To accomplish the full series of steps, Shuttleworth first sought to understand the existing journey: the standard internal BTFG and Westpac annual planning process. What were the steps? What was required at each step? Who was involved in the resource-prioritization process? How did they make their choices?

Shuttleworth understood that he needed to design the workflow of his project with his executives in mind. So which products should he tackle first? With careful consideration of the executive commitment challenge in mind, he chose one of the two products - the integration of wealth management and banking - because it was a key priority for Westpac overall. However, the second product - Self-Managed Superannuation Fund (individual retirement savings accounts) - was chosen because many of the senior executive stakeholders actually owned a Self-Managed Superannuation Fund. As business leaders, they were acutely aware that there was no decent solution in the market. But, as consumers, they could meaningfully understand and engage with the emotional experience of the product.

Starting from that deep understanding of the key stakeholders, the intervention continued to take shape. During the ideation and prototyping stage, Shuttleworth simply rang up each executive to ask for an hour of his or her time. There was no pre-reading; no PowerPoint deck. He just wanted to show them the customer experience prototypes that had been designed, to get their reactions, ideas and challenges. (See below for an example of a product sketch).

One by one, Shuttleworth visited the executives personally, but not in random order. He wanted to build a momentum across the teams. So, he started with the BTFG Executive Team, and then talked with key members of Westpac's Executive Team. Finally, he made a more formal presentation to the Board.

One of the key supporters during the process was the Head of Strategy for the Bank, Jon Nicholson. His reflection on the approach is enthusiastic: "The traditional systems proposals process...tends to produce proposals which are vague, overreaching (we will fix everything), poorly costed, and have a largely fictional business case. By contrast, a prototype tends to be much more specific and has actual user feedback; the cost issues have been surfaced more effectively (especially the challenges of integrating into legacy systems, which drives a lot of "overrun" cost) and the business value is more obvious." After experiencing the approach Shuttleworth used on Panorama, Nicolson reflects that using design thinking would be a better way to run strategy across the group, giving business units seed funding to test their ideas through prototyping rather than asking for analytic proof in advance.

Rather than declare victory and ask for funding for the entire project, Shuttleworth continued on his design-thinking trajectory for the intervention. He knew that the smarter approach to the intervention was to ask for greater levels of investment resources only as both rational and emotional confidence built up over time. That meant sharing key insights from the work (like customer personas) as part of the budget approval process. It also meant, on the basis of the successes of the early prototypes, coming up with a rigorous business case for the first $20 million of investment to build those prototypes into initial products and complete the technical feasibility study.

At the end of 2011, Shuttleworth's team received approval from Westpac's executive leadership for the initial $20 million request. Shuttleworth's assessment: "Success in convincing them came from a combination of a rigorous business case and the prototypes." Logic plus emotions were strong enough to overcome the lack of compelling data on the future payoff of the investment. Moreover, customer reactions to the prototypes were beginning to produce some data.

During 2012, Shuttleworth's team took the prototypes and built them into draft products. At the same time, they studied the technical feasibility of the proposed infrastructure replacement. Along the way, they continued to engage with senior leaders through showcase sessions, bringing executives together to engage with rough prototypes, and drive engagement in the work.

Getting the Board's Approval

Then it was time to go to the Westpac board for approval of the rollout based on the results to date and the technical feasibility report. Here, again, the approach was to combine logic (provided by the rigorous feasibility work) with emotion. Because the vast majority of the board members had a Super Fund, Shuttleworth had the board members actually try using the latest version of the prototype. Based on their experience with the old platform and product, board members were able to truly understand the difference at a visceral level. In addition, Shuttleworth "show[ed] them stunning videos of the customer experience" from their prototyping work with customers.

To Shuttleworth, another key challenge was "how to get the executive team to hold the course over a multi-year program, when there are many priorities across the bank." They needed reassurance throughout the process. So, in addition to status updates on project milestones, Shuttleworth included demonstrations of functionality and more videos of the customer experience with the ever-improving products.

This iterative approach kept the Board and executive teams comfortable and confident with continuing to invest over a three-year rollout period. Over that time, the logic and emotion were joined by data from the increasingly successful customer use of the products and platforms. In this way, Shuttleworth combined user-centered design with intervention design to bring about a revolution in the way BTFG served its customers.

Design disciplines of deep user understanding and rapid, iterative prototyping have long been used to design better artifacts for customers. However, design won't make a positive difference if those artifacts never make it to market. That is particularly a challenge with genuinely new ideas, for which no proof currently exists as to their possible success. This challenge necessitates carefully crafted Intervention Design, using design disciplines to guide the design of intervention as well as of the artifact. John Shuttleworth at BTFG demonstrates the power of that combination to deliver great results for the customer and the company.

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Use Design Thinking to Build Commitment to a New Idea

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The logic we use to understand the world as it is can hinder us when we seek to understand the world as it could be. Anyone who comes up with new ideas for a living will recognize the challenges this truism presents.