A Behavioral Approach to the Lean Startup/Minimum Viable Product Process: The Case of Algorithmic Financial Systems
International Journal of Innovation Management, Online Ready, 2019
54 Pages Posted: 22 Apr 2019 Last revised: 23 Mar 2020
Date Written: 2019
This paper theorizes about the behavior of firms engaged in complex product systems innovation and engineering under the lean startup / minimum viable product process. In doing so, it fills a gap in the literature at the intersection of innovation management and behavioral economics. By deconstructing the concept of commercial value, we assemble, define, and structure the relationships among seven values that innovation teams encounter along the path of innovation. Then, we demonstrate the usefulness of the proposed framework by applying it to the case of algorithmic financial systems. As a quantitative implementation, the model of capability developed for this domain may have broader applicability. For innovations where performance is probabilistic and achieves a steady state, capability can define what counts as “good enough” commercial value.
Keywords: lean startup, minimum viable product, behavioral finance, cybernetics, innovation management
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