Kromatic Client Case Study – CBUSA
CBUSA is a network of independent contractors who leverage their group power to compete against large-scale builders. With hundreds of members across the U.S., the group flexes its collective muscle to reduce material and labor costs, strengthen industry relationships, and maximize efficiency through shared, cloud-based tools.
After taking our coaching program, CBUSA was able to conduct experiments at 20x their previous rate, helping them adopt a more rapid, practical, and efficient innovation mindset. The team’s production cycle went from one year to two weeks, getting their products to market months ahead of schedule.
“Rigorous is a great word to describe Kromatic. The pace is fast and intense. It’s part of their ethos that you need to learn and fail quickly. But the weekly sessions helped us prioritize the insights and to dig deeper on the issues that really mattered. Kromatic set the bar much higher than we would have on our own. Validating product-market fit before starting development was a big step forward for our business.”
The company decided their growth wasn’t where they wanted it to be, but they didn’t know what to do about it. New ideas were sputtering, larger projects were unmanageable, and they couldn’t figure out how to tap new business opportunities with their existing customers. They needed someone to teach them how to implement lean startup methods and shift their mindset to explore areas outside their comfort zone.
After reading Kromatic’s Real Startup Book, the company’s executives recognized that this was the practical approach they needed to take their business to the next level.
“The Real Startup Book was important in our decision to move forward with Kromatic because it was very tactical,” says CBUSA’s Chief Financial Officer Brendan Sheehan. “It answered so many of the how do I actually do that type of questions we had. We sensed that Tristan was rigorous and took a practitioner’s approach to lean innovation. The approach outlined in the Real Startup Book was exactly what we wanted to do at CBUSA.”
“They practice what they preach. You can watch Kromatic build their business using the same principles and see how they are getting great results. It lends a lot of credibility — they walk the walk.”
We started with a one-day, in-person workshop at the CBUSA head office in Portland, where we introduced them to the basic principles of lean innovation and prepared them for the shift in mindset required for a fail-fast, learn-fast approach.
Next we guided the team through weekly coaching sessions, where we debriefed the experiments and research from the previous week, and helped them recognize when the data required them to change their plans to align with their current stage of product development.
What started as a layer of accountability turned into a disciplined approach to product development, with the team focusing on what was learned from their experiments and reprioritizing their tasks to design new experiments for the coming week.
Over the 3-month coaching period, CBUSA generated at least one experiment per week, learning how to question their assumptions about their customers, to avoid the operational miscues of automated solutions, and to prioritize their insights and dig deeper into the issues that really mattered. The company gradually increased their level of risk as we went from discovery, to value proposition testing, to demos, and then to concierge testing a real solution for their customers.
“The fact that we had participation in our pilot from both sides of the marketplace was a milestone. Both sides were willing to depart from business as usual and assume some operational risk to test our new solution.”
After our coaching program, the CBUSA team grew from ad hoc membership to a fully cross-functional team of 7, and their innovation planning went from 2-3 times per year to a weekly event. We helped them design an order-processing system by combining Google Sheets, Axure, and email, and to organize their workflow using tools such as Mural, our Business Model Canvas, and Kromatic templates such as Learn S.I.M.P.L.E., Learn S.M.A.R.T., and our Product Market Fit Storyboard. Their build time went from 12 months to 2 weeks, allowing them to deliver solutions to market nearly a year ahead of schedule.
But central to the process was the change in mindset. By re-aligning their practices around Lean Startup principles, they embraced the value of learning, the importance of co-developing their product with their customers, and the importance of pivoting their value proposition and roadmap according to their customers’ pain points.
Ultimately CBUSA’s vision of a broad, Amazon-like, B2B marketplace shifted to a more narrowly focused procurement platform. By embracing the fail-fast, learn-fast mindset, they began to challenge and revise their assumptions on the fly, going from years-long to weeks-long production cycles. More importantly, they honed in on the viable, scalable product they needed for this phase of their business, and laid the groundwork to do the whole thing again when they’re ready for their next big leap.
UPDATE: In October 2020, CBUSA was acquired by the management software giant CoConstruct, bringing CBUSA’s purchasing network — one of the biggest of its kind in the U.S. — into CoConstruct’s portfolio. Adding product-development expertise to their community- and process-management focus leaves CBUSA poised to make the most of CoConstruct resources.