The iteration cycle is a process by which an entrepreneur makes improvements to any aspect of a business. Kaufman lists the major steps of the iteration cycle and provides a helpful acronym to remember them. The WIGWAM method is described as:

1. Watch – What’s happening? What’s working and what’s not?
2. Ideate – What could you improve? What are your options?
3. Guess – Based on what you’ve learned so far, which of your ideas do you think will make the biggest impact?
4. Which? – Decide which change to make.
5. Act – Actually make the change.
6. Measure – What happened? Was the change positive or negative? Should you keep the change, or go back to how things were before this iteration?

I think this is something that most people do, at least in part, instinctively. I found myself going through these same processes in my own business, but I haven’t been realizing the true potential of the cycle. The power of this process, however, comes from defining your goals and accurately measuring the feedback from your customers or employees. Another key aspect of the iteration cycle is the speed through which it can be completed. The main benefit of the iteration cycle is the reduction of risk. When you take the time to go through the steps quickly then you lower the cost of bad or ineffective decisions, and can move on to more promising ideas.