Final Exam Notes 2018.docx - Exam 2017-2018(example Question 1 What is the rationale of the MVP and what purpose does it serve in an existing vs a new

Final Exam Notes 2018.docx - Exam 2017-2018(example...

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Exam 2017-2018 (example) Question 1; What is the rationale of the MVP and what purpose does it serve in an existingvs a new market. 1) The MVP or minimum viable product is a version of your product or service that can beproduced at lower cost than the actual product you have in mind, to start learning about therange of features designs etc. that the customer actually values.The MVP allows you to learn about your intended business in a cost effective way.This is especially important if you are offering a product or service that is entirely new tomarket where there are no competitors in the market which can function as an analogue forpotential success. In a new market uncertainty level is quite high which means testing,gauging and validating becomes more important, e.g. with an MVP. This cost effective version of your product/service allows you to start learning how itsatisfies customers within your intended market segment. It may be that you are focusing onthe wrong segment, you can use the MVP to re-direct your focus in terms of customersegmentation. It would be expected that your assumptions in an existing market are moreaccurate, hence less iteration is expected to occur in terms of fine-tuning your customersegmentation as compared to a new market.MVP deployment can further be used to steer future development, e.g. whichfeatures are key to customer acceptance, which features provide the most value and at whatcost to the start-up. Which features are considered by customers to be more peripheral,hence can be left out if they come at a significant cost to the start-up. Again, operating in anexisting market would allow testing of more incremental innovations as compared tocompetitors offerings, but would be important to gauge the degree of separation from whatis already out there in the market. In a new market the application and breadth of featuresof the product is flexible and open, meaning that MVP deployment may be more iterativeand over a more extended timeframe. In summary, the MVP is important to learn about your assumptions and the lessonslearned will be more likely to have profound impact on segmentation and product/servicecharacteristics in a new market than in an existing market.How to lose points:1)No definition of MVP (or wrong definition)2)No explanation of the rationale (why do we deploy MVP’s) (or false ones)3No distinction between new and existing markets (or distinction that does not make sense)4)An elaborate practical example5)Unclear arguments6)Woolly narrative
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