The Four Steps is a framework developed by Steve Blank. I’ve always found it a robust tool for thinking about where a product or company is in their development and where they should be focused (and where they should not be focused). The following diagram is a summary of the four steps:
Customer Discovery
At this step, the team should be focused on relatively open-ended discovery, learning who their customer is and what’s actually on their A-list in your area of interest. I would consider moving on when you have a clear view of an early market persona and problem scenario and a working hypothesis about a value proposition you want to test. At this point, you’re at the end of what you can learn from open-ended questions and you need to be able to observe how your hypothetical customer reacts to an MVP (a la Lean Startup).
Customer Validation
At the beginning of this phase, you are still (hopefully) pre-product in the sense of having invested in actual, working software. You are using techniques from Lean Startup to if and how your customer is motivated with regard to your hypothetical problem/solution(proposition) fit and then your specific product/market fit.
Customer Creation
Here you are taking what might be called an early product/market fit and seeing if how you can apply growth hacking recipes to scale it. You’re not exactly popping the cork yet- you’re still grinding through growth experiments to see if you can expand to a large market.
Company Building
This is a combination of traditional management with regard to building a capabilities-based organization that can scale, but also putting in place a robust innovation program so you can loop back to step 1 and continually renew the company.
