Creating innovation through iterative cost structure analysis for startups
Sharaf, Nicholas (2015)
Sharaf, Nicholas
2015
Master's Degree Programme in Business and Technology
Talouden ja rakentamisen tiedekunta - Faculty of Business and Built Environment
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Hyväksymispäivämäärä
2015-09-09
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:tty-201508281572
https://urn.fi/URN:NBN:fi:tty-201508281572
Tiivistelmä
The global market is seeing a growing trend of startup launches. Each startup has the aim to be successful, though worryingly 90% of all startups fail to overcome the hurdles they face in their first year and go out of business. Such a high percentage of failures is also fast becoming a deterrent for people interested in pursuing careers as entrepreneurs. More so present day literature lacks the discussion on how a startup should handle multiple roadblocks coming on their way simultaneously. Significantly majority roadblocks startups face come in the shape of costs which financially cripple the businesses. Without having proper insight into cost management, entrepreneurs stand little chance.
The objective of this thesis is to identify the lean startup methodology and embed cost structure analysis into its running process. This thesis then formulates an iterative framework where cost relevant roadblocks for startups can be tackled by either innovation, new technology or outsourcing.
The derived framework is then implemented on existing startup cases. It is determined that startups require constant validation for their problem and solution hypothesis before an efficient business model can be built. Even after conception, the business model needs to be analyzed specifically to pinpoint roadblocks to its success. These roadblocks are identified and by using the concept of cost structure analysis inside the framework resolved. The framework gives entrepreneurs the tools to quantitatively assess their business model and product offering and through constant iterations develop a model which is practical in the market and as a result derive innovation.
The objective of this thesis is to identify the lean startup methodology and embed cost structure analysis into its running process. This thesis then formulates an iterative framework where cost relevant roadblocks for startups can be tackled by either innovation, new technology or outsourcing.
The derived framework is then implemented on existing startup cases. It is determined that startups require constant validation for their problem and solution hypothesis before an efficient business model can be built. Even after conception, the business model needs to be analyzed specifically to pinpoint roadblocks to its success. These roadblocks are identified and by using the concept of cost structure analysis inside the framework resolved. The framework gives entrepreneurs the tools to quantitatively assess their business model and product offering and through constant iterations develop a model which is practical in the market and as a result derive innovation.