The one skill your boss wants you to have (and how to do it)

When I announced my new product management course, Idea To Revenue Masterclass, I asked the folks who manage product teams — Directors, VPs, SVPs of Product — what they’re looking for in their product managers.

The responses I got were eye openers.

Here are some of the replies I got, with certain parts bolded by me that I think are super important:

“A well balanced product manager knows how to take a concept from ideation to delivery. I find some are strong in one but not the other.”

“Our product managers need to learn to drive product innovation by deeply understanding the ecosystem in which our customers operate, address the most pressing customer needs, and ensure we deliver business and customer value and drive company revenue.”

“Currently, our PM team is not leading. They mostly focus on fixes to the current products. They need to be more strategically driven, and be able to size the market opportunity for new ideas. As a result, to be honest, our executive team is not comfortable empowering our product managers to make decisions, and so priorities keep changing constantly.

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In other words, they want product managers who can be strategic product leaders that can drive innovation and deliver business results… not just be backlog grooming sprint release operators.

Having worked with 100s of product innovators and numerous software and digital products and services, I’ve learned that the best product managers think and act beyond tactical activities like backlog grooming, sprints, requirements, stories, releases, user testing, etc.

These activities are important, but in and of them they don’t drive innovation and don’t deliver business results that matter.

The best product managers think and act strategically — that is to say:

  • They think about and pursue monetizable market opportunities.
  • They think about and actively work at tying their activities to business results that matter — acquiring new customers, increasing LTV or ARPU, speeding time to market, etc.
  • They think about the “whole product” — not just the core software app itself, but also how to market, sell, deliver and support that product to customers — and execute accordingly.
The Whole Product

Product Canvas – downloadable here

It’s this strategic perspective that then drives their tactical day-to-day activities.

In this post, I’m going to talk about one of the ways — one of the most important ways, actually — that the best product managers impact business value:

Validating the market opportunity for a product idea.

The best product managers know that to pursue any product idea it must be a problem worth solving. In an earlier post, I talked about how there are 3 criteria any product idea must satisfy in order for it to be worth pursuing:

  • It must solve an urgent problem for a customer.
  • The problem must be pervasive — that is, enough customers must feel that pain or have that need.
  • Customers must be willing to pay to have the problem solved. Or, more specifically, they must be willing to buy your solution to their problem.

This is what it means to have a monetizable market opportunity. And being able to identify these opportunities (and then execute on them) is exactly what the product team leaders above are looking for in their product managers.

Unfortunately it’s a big area where many product managers fall short.

Why is it important to analyze the market potential for a product idea?

Because quite simply, if enough people aren’t experiencing the problem and are willing to pay for your solution, then the market potential for your product idea isn’t big enough, and it’s not worth pursuing it. Period.

viable_product_ideaSo you need to find out before investing considering capital and resources in developing the product or capability whether there may be a market for it.

Also it:

  • Establishes whether the business opportunity for your idea is reasonable.
  • Informs how you look at, analyze, understand, and segment the market.
  • Demonstrates an understanding of your customers’ pain points and the value of your solution.
  • In turn, informs how to enter the market — your go-to-market strategy, pricing model, etc.
  • Provides optics for the growth of your product — a sounding board to measure your financial model and your progress against it.

This isn’t just for brand new product ideas alone. It applies to new feature ideas for existing products and other product expansion ideas as well.

Any new feature or capability must deliver both customer value and business value. There has to be some clear ROI for adding a new feature to a product. Perhaps the new feature will help up-sell existing users to a higher pricing plan. Or maybe help accelerate new customer acquisitions in your target market segment. Or reduce churn and increase lifetime value. Or maybe it will help improve customer satisfaction leading to increased retention.

Your company has a choice of whether to focus its resources on developing feature A or feature B. In fact, it has a choice of whether to have its resources focused on your new feature idea or something else entirely.

So it’s important to vet whether there’s enough of a market demand for that feature before investing engineering cycles building it.

There are several common mistakes product managers make in estimating market potential. Let’s talk about these and then go through specific examples of how you can calculate the market potential for your product idea.

Common mistakes in estimating market size

Your market is NOT “everyone” or “anyone”, as in “everyone who drives a car”, or “every business that needs a CRM”, or “anyone who uses social networks”, etc.

Heck, the market for this blog isn’t “everyone who reads blogs”!

In fact, it’s not even “every product manager” out there. If you’re a product manager for a hardware product, it’s nice to think there may be nuggets in these posts that could help you, but I’ll tell you straight up I don’t specifically target you. So if you find zero value in these posts, that’s cool with me.

Even for a new feature for an existing product, your market potential may not be “all our existing customers”. For example, not all customers using your messaging service may be interested in archiving old messages.

You need to drill down and get specific about the true size of your market. Otherwise, your executives and Board will question the validity of your product idea — and, frankly, your credibility.

To make this super tangible, let’s talk through how you can size the market for a new product and a new feature.

Assessing the market size for a new product

The most common way folks do this is what’s called the “top-down approach”. This approach uses a broad market size figure and whittles it down to the target market.

It typically goes something like this:

  • Let’s say your product is an analytics algorithm that can decide the sentiment of a Twitter stream.
  • You find that IDC (or Gartner, whatever) says the market for big data technology services is $6.2 billion. You estimate that the portion that’s for sentiment analytics software is 20% = $1.24 billion.
  • With your existing sales and marketing channel, you believe you could realistically reach 25% of this market = $310 million.
  • But there are 10 other competitors in that same reach. So assuming you can capture 15% of the market, your target market share = $46.5 million.

Now, if you read that and are feeling uncomfortable, yeah, you should.

‘Cos it sounds squishy, right?

That’s why I’m not a big fan of the top-down approach:

  • The broad market size figure used as the starting point in the top-down analysis often includes different market segments, so it’s easy to forget to take some of these out of the estimate.
  • You’re extrapolating without direct customer validation. So top-down can come off as a bit optimistic (and even fuzzy).
  • When extrapolating, you’re typically using a percentage off a very large number, like 1% of a billion dollar market, but it doesn’t take into consideration which 1% or how you’ll get this 1% with your specific product.
  • Plus, how do you know if a 1% market share is the right success criteria for you?

As such, the top-down method can give you a false sense of comfort.

(Plus, smart execs will see right through it and tear it apart.)

Instead, a “bottom-up” approach is better. This approach builds up the total addressable market by using the main variables of the revenue model — typically total number of potential customers multiplied by what they typically spend or are willing to spend.

It requires more effort, because you’re evaluating where your product can be sold, the sales of comparable products, and the slice of current sales that you can carve out.

(BTW, this is where your customer persona and primary market research really comes in useful. You can use them to identify how many customers are in your target market, and extrapolate from there.)

Let’s go through an example:

Your product is an app that helps people play basketball more regularly by helping them find the right place, time and people.

You’ve discovered that people pay to book time at basketball venues, and your idea is to charge these venues a fee for referring basketball players who use your app.

You interview 10 basketball venues, and discover they typically get 100 bookings per month, each booking consists of 10 players, and each player typically pays $50 to play.

So the total value of monthly bookings at any given venue = $50 * 10 * 100 = $50,000 or $600k per year. And if there are 2,000 venues in your target market, that’s a total market of $1.2 billion.

You find that 70% of venues (1,400) have already signed deals with your competitors, leaving you with 600 unsigned venues. You believe you could steal 10% (140) of already signed venues — so if you signed up all 740 (i.e., 600+140) of these venues, that’s a serviceable market of $600k * 740 = $0.44 billion or 37% of the total market. (It may reasonably take several years to do that, of course.)

You feel confident all 10 of those venues you had interviewed could be initial customers. You extrapolate that there are about 200 venues just like those, i.e., they fit your customer persona. You could target them in the first year, giving you a target market of $120M (27% of your serviceable market and 10% of the total addressable market).

While there are undoubtedly some assumptions inherent in this analysis (and many dependencies to achieving those targets), this type of analysis is much more useful.

For one, it gives you more grounded assumptions to use to extrapolate to the broader market. It’s less likely to include non-addressable revenue since your basis is to start from your primary market research. Finally, it forces you to consider how you’ll be able to attract and acquire customers — for example, you’d love to sell internationally, but if that’s unrealistic for several years, you can’t really factor that in. On the other hand, you can focus your go-to-market efforts specifically on targeting that initial $120M in the first year.

You can also play with the variables to get a sense of best-case and worst-case scenarios. For example, what if you could steal 20% of already signed venues? Or only 5%? What if there are only 100 venues like the 10 customers you interviewed? What if it takes longer to acquire any of those 600 unsigned venues?

Assessing the market size for a new feature

Now, for a new feature or capability for an existing product, how you analyze the market size depends on your goals for the new feature — things like accelerate new customer acquisition, up-sell existing customers, penetrate an adjacent market segment, etc.

For the sake of simplicity and illustration (and because this post is getting pretty long), let’s assume the goal is new customer adds — e.g., this feature is the key missing ingredient that has prevented new customers from purchasing your product till now.

Let’s say your product is targeting a $50 million market and currently generates $5 million in revenues. It’s been successful with early adopters, but now you want to expand within your target market to “early majority” type customers (in the technology adoption curve).

You’ve identified a new feature that your product would need to have to attract this group of customers, and your problem hypothesis testing validated the pain point it solves. From this work, you’ve built a customer persona to target for the new feature, and through further market research and analysis, have identified that 25% of your product’s current target market fit that persona (i.e., they have the same problem).

Your total market opportunity is 25% of your product’s target market * your product’s price (assuming no change).

You believe it could be possible to capture 10% of those customers in the first year. So your target share of market is 25% of your product’s target market * your product’s price * 10%.

Again you could play with the variables for best-case/worst-case scenarios. For example, what if you captured only 5% in the first year? Or 20%? What if it only 15% of your product’s current target market fit the persona?

Once you have your market size, what next?

Play around with the assumptions and variables in your analysis. For example, try different pricing levels, or vary the percentage or number of customers.

This analysis shouldn’t take you very long — you’re merely trying to estimate the opportunity to get a quick sense as to whether there’s a market opportunity for your product idea. If you’re spending hours or days torturing a spreadsheet, you’re spending too long on it.

Of course, you don’t know definitively whether customers will actually validate your product idea, let alone buy it. But you want to do this exercise at this stage because you’re essentially trying to answer if there are enough customers in the market with the problem you’ve identified, and how much revenue you could potentially target if they’re willing to buy?

In other words, is it big enough? If the market opportunity is too small, if there aren’t enough monetizable customers, it’s not worth going after, and you’ll be faced with a pivot. (And a pivot isn’t a bad thing.)

* * *

The best product managers understand that to really drive innovation and deliver value to their businesses they need to be thinking and acting strategically.

As part of that, they understand they need to be testing and validating whether a product idea is worth pursuing before investing major capital, budget or resources on it.

A critical part of that validation exercise is assessing the market potential for a product idea. Doing so exposes important assumptions inherent in the initial product strategy hypothesis. It helps product managers justify the product idea to themselves and to their internal stakeholders, and serves as a reality check for the product idea.

This kind of analysis it NOT about arbitrarily picking a large number out of thin air and then working some Excel magic to rationalize the number. As I’ve shown, there’s a grounded way to approach it.

And, as a result, should the market opportunity for the product idea have potential, it allows for a more actionable way to pursue it.

As Ash Maurya has correctly said:

“While we all need a ballpark destination to justify the journey, it’s not the destination itself but the starting assumptions and milestones along the way that inform whether we are on the right path or need a course-correction.”

To your product success!

The Top Strategies For Doing Customer Interviews That Get You Real Insights

We all know a core responsibility of a product manager is to constantly and consistently bring the customer perspective into the business.

That means customer interviewing is a critical skill for every product manager.

I must admit, earlier in my career I totally sucked at it.

I had no plan. I often just winged it. I asked the wrong questions. I was a poor listener. I talked more and listened less. I tended to get too excited about my product idea and go into pitch mode instead of focusing on the customer’s problems. And I was very guilty of confirmation bias.

Fortunately, with lots of practice, over time I got better. As I did, I accumulated a list of the best strategies that I use even today to conduct an interview that helps me extract real customer insights.

Get the Entire List of 25 Customer Interview Strategies >>

So in this video I share 5 of the best customer interview strategies:

Use these 5 powerful tips to supercharge your customer interviews to extract every ounce of goodness from them:

  1. Set an objective. Know what you want to get out of the interview — that is, what is it you want to learn and come away with?
  2. Have a script. Having a script will help guide your interview with the customer, be better prepared and purposeful in your interviewing, and make sure you achieve the objective you’ve set out.
  3. Ask “Why?” — a lot. This is by far the most important question in your arsenal. It allows you to go deep, get inside the mind of your customer, understand their motivations, get to the true nature of the problem they’re trying to solve, and how they actually value their solutions.
  4. Ask for examples. Asking for an example forces your customer to get specific rather than speak in generalities, giving you tangible evidence of a customer’s problem, and allowing you to momentarily “live in their world”.
  5. Focus on listening. Cannot stress this enough! The biggest thing you can do is to TALK LESS AND LISTEN MORE. Your purpose is to get THEIR perspective — not promote your point of view, explain yourself, defend your idea or debate. The only times you should look to speak is when you need to clarify something or need to ask a follow-up question.

Get the Entire List of 25 Customer Interview Strategies >>

Follow these strategies and you’ll become a pro at conducting truly insightful customer interviews.

Watch the video above, download the full list of customer interview strategies, and please share in the comments below what strategies you’ve developed to conduct truly insightful customer interviews.

How Do You Become A Good Product Manager?

This is the BIG question, isn’t it?

We all want to be the best at what we do.

And product managers are no different. We want to be good. Great. Awesome.

And we want to be recognized for it!

We want to launch products people love. We want customers to love it. Our company’s to grow from it. Our teams to feel pride in it. Competitors to fear it. And our executives to love us for it.

So how does one become a good product manager?

Unfortunately, there’s no one size fits all answer to this. There’s no silver bullet or 3-step process that guarantees you will become a good product manager. (Let alone a great one!)

But it’s one of the most frequently asked questions. It gets asked at ProductCamps. It’s asked on Quora in different ways. And it’s one I’ve been asked countless times by folks I’ve mentored, by peers, even CEOs and senior executives.

Lots of knowledgeable and seasoned product management practitioners have weighed in on this. Some really good perspectives from some really smart, successful product managers.

So today I weigh in with my perspective. While there’s no single universal answer, I do believe there are some key principles or strategies you can adopt to become a really effective product manager.

And that’s what I share in today’s video.

Through product management gigs in startups and Fortune 100 companies, I’ve come to identify seven principles that help me as a product manager in any situation:

  1. Get to know your customer.
  2. Get to know your product.
  3. Learn the business.
  4. Learn the market/industry.
  5. Learn how to execute.
  6. Find mentors.
  7. Invest in yourself. That is, look to constantly upgrade your skill set.

The last two are really the key to unlocking your full potential as a product manager.

Are any of these new to you? These are sort of “no brainers” to me now, but looking back, if I’m honest with myself, I probably focused a bit too much on #2!

It can take time to master these, but I’ve come to realize they’re paramount to successfully execute as a product manager.

You can read my original answer on Quora, as well as some great answers to another similar question on Quora.

Watch the video and then please leave me a comment below on what do you think it takes to be a good product manager?

Here’s to all of us becoming great product managers!

The Most Important Thing You Need For Your Product To Succeed

Have you ever felt like there is no clear direction for your product?

That you keep getting jerked around building features to satisfy the latest customer opportunity?

That your product can do a lot of things, but it’s hard to articulate exactly what it does in just a few short sentences?

Maybe your product is trying too hard to be all things to all people?

Or maybe folks are constantly asking you why…

Why are we building these features?

Why are we selling to those customers?

Why is the customer wanting our product to do something else?

The reason for this often boils down to a simple truth:

The product lacks a coherent vision.

Having a product vision is quite possibly the most important thing you need for your product to succeed.

Yes, strategy is important.

Yes, execution is important.

But it all starts with having a vision for your product.

Without a product vision, how will you know where you’re going and why?

So every product starts with a vision to make it real. It’s foundational to the success of any product. It’s your north star. Without a coherent product vision, even a seemingly “great” product idea will fail in the market!

I decided to put my thoughts on this into a video.

So here it is. In it, I talk about:

  • What is a product vision.
  • Why it’s important.
  • How you can craft one for your product.

I cover this in depth in this video:

Creating a product vision doesn’t have to be hard. You don’t need to write some fancy vision statement, nor do you need torture yourself by trying to come up with the perfect elevator pitch.

You can actually start simply and immediately by defining four things:

  1. Who is your customer?
  2. What problem are you solving for them?
  3. What is your solution to that problem?
  4. What is your value proposition — i.e. that ultimate benefit you’re trying to deliver to your customer.

This is something you can do today. Right now. It can take less than 20 minutes. Even 5.

It doesn’t have to be perfect. It just needs to be done.

I talk about it in the video.

Over time, as you learn from the marketplace, as you learn from customers, you’ll refine the vision. That’s a good thing.

Watch the video, and when you’re done, please leave me a comment on what challenges you’ve had to face because your product lacked a proper product vision.

Then be sure to grab this quick fill-in-the-blank worksheet below to help you create the product vision for your next great product idea!

Grab Your Copy Of The Fill-In-The-Blank Product Vision Worksheet >>

Do You Have A Problem Worth Solving?

In order to pursue any product idea — a new product, or a new feature for an existing product — you must make sure it’s a problem worth solving.

If it doesn’t solve a tangible, real problem that lots of people are facing, and are willing to pay to have solved, it’s not worth spending your time on it. Move on to your next great idea.

So how do you go about figuring out if your product actually solves a problem that’s worth solving?

And what makes a problem worth solving?

In their book, Tuned In, authors Craig Stull, Phil Myers and David Meerman Scott talk about this in detail.

In order to know whether your product idea solves a problem that’s worth solving, it must it must satisfy the following criteria:

  1. Is the problem urgent?
  2. Is the problem pervasive?
  3. Are customers willing to pay to have the problem solved?

These three questions need to be answered before investing a ton of money or resources into developing and launching your product.

If the answer to any of these questions is “no”, then you need to pivot.

Let’s talk about each of these in turn.

Is the problem urgent?

Any product idea you’re pursuing must solve a problem people really care about. It needs to be a real pain point, a critical need, or a super important job for them.

The pain may manifest as costing them money, time, resources, effort, credibility, or some other significant inconvenience or frustration. Even perhaps emotional or physical pain.

The need or job could be social (look good, gain status, etc.), emotional (feel better, feel more secure, etc.), or functional (an important job that must get done).

If it’s truly a pain point or priority need/job, people will have expended time or effort to have tried to solve the problem. They may even have “hacked” together their own solution, or spent money on trying to solve it. This is what’s meant by the problem being urgent.

But why does this matter? Why is it so important to validate the urgency of the problem?

Because nothing is more frustrating than working yourself silly trying to solve a problem that either doesn’t exist yet or that people describe as “not a big deal”.

Here’s an example:

I hate taking out the trash.

I have to do it 2x a week, put it out on my driveway in the evening so the garbage truck can pick it up first thing the next morning.

I especially hate doing it in the winters when it gets really cold.

Is it a job I need done?

Most definitely!

Is it a pain?

Yes!

But have I done anything to solve my problem?

No.

I keep complaining about it. But I’ve done nothing to change the situation.

It’s just not a priority for me — it’s just not urgent enough.

As product people, we’re naturally wired to look for solutions. So we quickly and easily fall in love with our solutions.

(Thanks, Ash Maurya, for representing this first on your Lean Canvas.)

But we need to care about PROBLEMS.

So if you’ve got a product idea, you need to first care about your customers’ problems.

This is true whether you’re thinking about your next new feature or a wholly new product.

Remember:

Customers don’t care about your solution. They care about their problems.

Just make sure the problem is an urgent one.

Is the problem pervasive?

The urgent problem needs to be one felt by a large enough number of people to make it worthwhile for you to develop and sell your product.

Why?

Say one product will cost $1,000 to make, and only two people in the whole world will pay you $10,000 each for it, and another product costs $10,000 to make, but 10,000 people will pay you $10 each for that one.

Which product is better worth your time?

Quite simply, if enough people aren’t experiencing the problem, then the market potential for your product idea isn’t big enough, and it’s not worth pursuing your product idea. Period.

Even for a new feature, you need to size the market opportunity for it.

Your company has a choice of whether to focus its resources on developing feature A or feature B. In fact, it has a choice of whether to have its resources focused on your new feature idea or something else entirely.

So no matter whether you’re pursuing a new feature or a new product, make sure it’s solving a problem that’s pervasive.

Are they willing to pay to have the problem solved?

This is critical — you may find a lot of people are complaining of the problem you’ve identified… but are they willing to pay to have it solved?

Most people have all kinds of problems that they’re just not willing to pay money to solve.

For example, I may whine about taking out the trash, especially in the bitter cold of winter.

And it becomes an urgent enough problem that I finally get my teenage son to do it. (Hey, it builds character.)

And lots of other people may be doing the same thing as me.

But neither they nor I are willing to pay to have someone come to our house twice a week to put the garbage out by the curbside.

Even for an existing product, a new feature must be able to create some tangible business value. Will customers pay for the new feature? Will the new feature justify a higher price for your product? Will it increase customer lifetime value, or accelerate new customer acquisition?

As long as you’re in a profit-making enterprise, it’s worth solving an urgent and pervasive problem only if the people with the problem are willing to pay for your solution.

Are you done? Not quite…

In order to decide whether to pursue your product idea or not, you need to consider a couple of additional things.

First, it’s possible that your company may have (likely has) a point of view (spoken or unspoken) on what it considers worthwhile revenue opportunities.

For example, at a $7 million company, a $50k opportunity could get the CEO’s attention…

…But at a $500 million company, anything less than $250k may not get much interest.

If so, it’s important to consider whether your product idea meets this threshold to be worthy of consideration.

Second, your product may have specific strategic business goals, such as driving new customer revenue, or generating expansion revenue from existing customers, etc.

If so, you’ll need to evaluate whether your product idea contributes in a meaningful way to achieving those goals.

In other words, is there enough monetizable value in your product idea?

If your product is currently generating $50 million in revenue with a goal to grow 15% in the next year, and you estimate your product idea could drive $500k in additional revenue, that means it will contribute less than 7% toward that goal.

Whether that’s good enough will depend on how it compares to other ideas that contribute toward achieving the goal, or whether it can be combined with other ideas in some rational way as part of a theme — then it will come down to how the theme in its entirety contributes toward the goal.

So to recap:

To pursue any product idea, make sure it’s a problem worth solving.

This means the problem must be urgent and pervasive, and your target customers must be willing to pay to have the problem solved.

Furthermore, your product idea must have enough monetizable value to contribute meaningfully toward your company’s strategic goals.

Fortunately, it’s not that difficult to learn how to do this. 🙂

The Secret Ingredient To Getting Product Innovation Done: “Internalvangelists”

So you’ve probably heard of “earlyvangelists”.

(No? Read this post by Steve Blank, who coined the term.)

In Lean Startup circles, we hear a lot about finding these special breed of customers. Why? Because they’re the ones willing to make the initial bet on the startup, because they’ve bought into the startup’s vision and potential. They’re not just buying release 1, but the entire vision of the startup. This is what keeps them committed even if the startup screws up a few times.

They are the true visionary customers talked about in the technology adoption lifecycle.

So a lot of focus is put in identifying, finding and nurturing these earlyvangelists. Test customer and problem hypotheses. Test solution hypotheses. Create an MVP. Find problem/solution fit. Get true customer validation by finding a handful of customers who are actually willing to pay you for your solution — the “earlyvangelists”.

Juxtapose this with traditional product management.

Now, when I started out in product management, I was indeed introduced to the technology adoption lifecycle. I read about it in books. People talked about it in conferences. “You must find those visionary customers and early adopters,” experts said in their presentations. Cool.

Problem was: no one taught me how to get these magical customers.

Business school didn’t teach me how to get earlyvangelists.

Product management didn’t teach me how to get earlyvangelists.

Instead, what I was told was to develop a business case. Write an MRD. Create a business plan.

Business school told me I was supposed to do this. Smart consultants and well meaning senior executives and mentors reinforced this. Elaborate PMO processes required this.

Want resources for your product idea? Show us your business case.

So what’s wrong with that? On the surface, it made sense. Unlike a startup, which is searching for a sustainable business model, a company is executing an existing business model.

Shareholder returns, customer value, and employee paychecks depend on the successful execution of this business model.

So the company needs to evaluate its investments in terms of risk to this business model. A company needs to know whether to dedicate its resources to project A or B. To do that, it needs to know which has the better payoff.

For example, the CFO needs to be able to answer a question from the Board like, “That $250,000 in development resources you spent last year… what are we getting for that?”

So a solid business case with cost/benefit, ROI analysis, risk profile assessment, etc., would allow for objective portfolio and investment decision making.

Good intent.

But here’s what actually happened.

Product managers began spending loads of time crafting multi-page MRDs and business case slideware, and crunching through multi-year financial “projections”. These documents were filled with unvalidated assumptions or HiPPO driven convictions.

“An exercise in pretend,” the product manager grumbled.

“How the heck can I figure out whether customers will buy the product before it even exists?” they’d ask. “And how can I figure out how much money it will make when no customer has bought it yet?”

“Well, you need to figure it out,” Big Exec would shoot back. “Else, no resources for you!”

And so the product manager would torture the spreadsheet more, try and convince finance of adoption rates and growth trajectories based on mere guesses, and go to Engineering/IT for estimates.

“You need to give me requirements,” Engineering/IT would say. “If they’re not documented, there’s no way I can give you estimates.”

So the product manager would then start writing an MRD / PRD / BRD / <stick your 3-letter acronym here>. Ah, the joy…

And under pressure to get “accurate” estimates, they’d pack in as much detail as possible, essentially guessing at the features and functionality that would be needed.

(Meanwhile, that Sales guy with his own “great” product idea has already sold vaporware to two customers and is magically getting resources assigned to deliver on his promise, including you, the product manager. Sales guy: hero. Product Manager: zero.)

The saddest part of all this was that every minute spent preparing the business case, writing the MRD/PRD or torturing the spreadsheet was valuable time not spent with customers.

So it’s no surprise that in a recent survey filled out by over 40 product managers who opted into my upcoming online course, Idea To Revenue Masterclass, they listed the following as their biggest product innovation and planning challenges:

#1 Biggest Innovation Challenge: Testing product ideas without having a product. With both customers and internally within their organizations. They need ways to test their understanding of the market, as well as evaluate the revenue potential for a product opportunity, but without having a product already.

“My number one product management challenge is creating business requirement documents on new products and demonstrating a return on investment for 1/3/5 years without releasing the product.” – survey response

#2 Biggest Innovation Challenge: Alignment, buy-in and communication.

How many people does it take to change a light bulb?

(Or maybe the question is: how many people does it take to get approval to change the light bulb?)

This challenge is a close second to #1 above. Product innovators are challenged with communicating product strategy to get buy-in, getting executive support for their product plans, aligning teams within the company to support new products, and managing communicating across multiple stakeholders.

“In a growing organization, with lots of ‘people of interest’, communicating what you are building and why is a huge challenge.” – survey response

The internal venture must fight on a second front at the same time within the corporation. That second fight must obtain the permissions, protection, resources, etc. needed to launch the venture initiative, and then must work to retain that support over time as conflicts arise (which they will).
– Henry Chesbrough, Why Internal Ventures are Different from External Startups

#3 Biggest Innovation Challenge: Resources.

We can never have too many resources, can we? 🙂

Working with resource constraints is a fact of life. But product innovators feel this acutely so.

They’re pushed to accelerate time to market, yet are challenged with selling the business case for the right mix of resources to do just that.

And, of course, this leads to the chicken-or-egg dilemma from challenge #1 — need a product to test whether customers value it, but need customer validation in order to get the resources to build the product!

“[My #1 product planning challenge is] getting and retaining key resources to minimize time to market consistent and aligned with company priorities.” — survey response

So what’s the solution?

This brings us back to “earlyvangelists”…

Lean practices can and should be adopted and adapted to pursue product innovation inside companies. But product innovators actually need to find two types of earlyvangelists:

  • Earlyvangelist customers.
  • Internal stakeholder advocates, or “internalvangelists”.

One of the biggest factors that can derail any new product endeavor is lack of internal support. In product innovation, lack of stakeholder traction can often be a bigger roadblock than customer traction.

These stakeholders may not only have access to essential information and resources you may need, but also influence key decision makers whose support is critical to the success of your product initiative.

The larger the organization you work in, the more stakeholders you’re likely to have. It’s important to identify who these folks are and make sure you’re not only bringing them along, but in fact creating them into advocates — evangelists — for your product initiative.

Product management didn’t teach me how to get internalvangelists.

The good news is a lean approach that fuses customer development type methods with sound product management practices can be used to not only get early customers, but also build the business case, create alignment, and cultivate internalvangelists iteratively.

Lean product management can get you “earlyvangelists” and “internalvangelists”.

Here’s an example:

Customer learning driven investment strategy

The approach calls for spending plenty of time with customers in a methodical way, systematically testing assumptions at each phase, while also having regular check-ins with folks internally.

Each stage is informed by learnings from the previous stage — “mini business cases”, if you will, at each milestone, instead of wasting time writing a big tome of a business case up front.

Requirements for delivery need only be done when there’s a clear signal to do so. For example, if you find there’s no problem/solution fit, no need to write detailed requirements to build out an MVP or do financial projections. But if there is, then only does it make sense to spend the time doing those activities.

This customer learning driven approach makes for a more market-informed investment approach to the product strategy. This makes it easier to garner, maintain and accelerate stakeholder buy-in, because:

(1) Each investment stage is grounded in real customer data, resulting in less assumptive and more empirically based investment asks.

(2) Smaller continual investments that deliver continuous tangible ROI throughout the process are easier for folks to digest and support than large bloated ones upfront.

(3) Stakeholders continually feel involved in the process, increasing confidence to persevere.

There are surely other variants to this approach. The point here is that lean principles can be fused with sound product management practices to:

  • Test product ideas without a product.
  • Build the business case iteratively.
  • Get alignment and buy-in, and create internalvangelists.
  • And get those magical earlyvangelists!

The Keys To Productive Brainstorming

Brainstorming

(c) Rob Cottingham, used via a CC BY-NC 3.0 license

Let’s face it: brainstorming has gotten a bad rap. And deservedly so.

How many of us have been part of a “brainstorming meeting” that turned out to be a total waste of time? Too many people. A purposeless agenda. Meandering conversations that go nowhere. And no follow-up afterward. Sound familiar?

In fact, doesn’t “brainstorming meeting” sound like an oxymoron?

The irony is brainstorming is actually an important tool to uncover creative solutions to thorny problems. Brainstorming broadens one’s perspective, allowing for new and unexpected ideas. It fosters collaborative thinking and the sharing of ideas, uncovers unexpected questions, and encourages creative exploration. These are important ingredients to fueling innovation.

If done well, brainstorming can be an invaluable tool for any product manager, entrepreneur or innovator.

So the problem really is that most brainstorming sessions are simply not conducted well. (OK, most are conducted really badly.)

So when Essay.Expert shared the following infographic on “Keys To Constructive Brainstorming”, with some useful tips on effective brainstorming techniques, it was a great reminder of how useful brainstorming can be if done right.

I particularly like tip #2 as it increases the likelihood of greater engagement during the brainstorming and continuity after.

Keys To Constructive Brainstorming

(c) Essay.Expert

What brainstorming practices have you seen successfully applied in your work?

5 Indispensable Habits Of Great Product Leaders

As a product management leader, there are many demands on your time. It’s easy to get sucked into working on the most pressing issues and on meeting other people’s expectations.

As “do-ers”, it’s in our nature to jump on these issues immediately. We pride ourselves on our competence to tackle these right away.

But when we do so, are we as product leaders really making traction on the things that matter? When you get to the end of the day, do you feel a sense of accomplishment?

We’re all familiar with the Eisenhower Decision Matrix:

Eisenhower Decision Matrix

Eisenhower Decision Matrix popularized in the self-help book “First Things First” by Stephen Covey

We know we should be spending more (most) of our time in quadrant 2, the yellow box.

I must admit, though, I’ve been guilty of spending too much time in the urgent column. Heck, I’ve wasted time being in quadrant 4.

There’s always a fire to put out, an urgent meeting, a request from up the chain to satisfy, someone stopping by the desk to ask a “quick question”, an email to answer, a phone call to return.

The problem is that while it feels like we’re getting stuff done in the moment, we’re actually not getting anything of real value done. It’s an illusion.

And we know this, because by the end of a day like this we usually feel drained, and lack a sense of real accomplishment.

This problem can be particularly acute for product leaders, who are responsible for (among other things) the product vision and strategy of the company, the business results of the company’s product portfolio, the performance of the product management process, and the success of their team.

The challenge is if we don’t make time for the important stuff, the urgent will always win.

But it’s easy to say we should spend time in quadrant 2. How do we actually do that?

Dan Martell, successful serial entrepreneur and investor, published this video on his YouTube channel in which he talks about what should the day of a startup CEO look like.

He talks about how as he grew in his career, he began thinking about how he could make time for the things important to him, and what are the things other people can support him on and help him with.

He lays out 5 things that startup CEOs should focus on. As I listened to this list, I realized that these same habits apply to successful product management leaders!

They’re habits because they do these regularly, every week, every day. It’s how they ensure they’re making traction on the things that are most important.

As I’ve grown in my own career, I’ve done these same things, and found them to be indispensable in the successful execution of my products.

Here they are:

1. The Daily Check-In

The most effective product leaders check in with their team every day.

Yes, every day. As much as is practical, do this at the top of the day.

One way may be in the form of a stand-up or huddle where folks provide a quick update on progress and highlight any major impediments to getting work accomplished.

Another way is to check in individually. You may “walk the floor”, stopping by each team member’s desk for a few minutes to see how things are going, how they’re feeling, and if there any major issues they may need help with.

As a product leader, you need to stay in tune with the “pulse” of your team. A daily check-in will enable you to stay on top of things tactically, as well as ensure you’ve got the temperature of your team members.

2. Keep Half Your Schedule Open For Strategic Stuff

What? Half? Really?

OK, so this one may be a challenge. But it’s SUPER important.

As a product leader, you’re responsible for setting the product vision and strategy.

That means spending time doing research, discovery and analysis, AND having some thinking time.

In addition, as a product leader, you’re responsible for communicating the product vision and strategy to everyone else in the organization.

So the point here is you need to keep a good chunk of time dedicated toward strategic activities.

If you think this is difficult, look back at the Eisenhower Decision Matrix, and ask yourself how you realistically plan to get quadrant 2 stuff done?

If you don’t make time for it, if you don’t protect that time, trust me, you’ll never get it done.

I’ve actually blocked time off on my calendar to do strategic stuff. I fight not to give up that time.

Keep half your schedule open for strategic stuff.

3. Major Projects Should Be On Your Calendar

This is somewhat related to point #2.

For example, you may be performing due diligence on a potential partner or acquisition as part of a developing product strategy. Or you may be conducting some market research or customer interviews.

Make sure these things are on your calendar.

In addition, there may be major initiatives either you are personally championing or that your team is working on that require your priority attention. A new product launch or a major release, for example.

If you want to get traction on these things, be sure to block off a reasonable amount of time for them — time that enables you to achieve flow.

4. Align Everyday Work To The Product Vision

In product management, it’s easy to get consumed by a particular feature, requirement, story, page layout, design construct, thorny technical issue, project delivery date, PowerPoint slide, or Excel analysis.

As a product leader, you need to make sure everyone understands their work serves a higher purpose.

That it ties back to something bigger, a shared goal. This is typically the product vision, product strategy, even the company mission.

And you need to do this constantly. All the time. Every day.

As Dan Martell describes it perfectly in his video:

“People forget. They get in these funks. They don’t understand why what they’re working on is going to be aligning to the bigger purpose. You should be going around to your team and saying, ‘Hey, you know that interface you’re designing? That’s going to allow us to do X, Y and Z, and allow us to achieve these big results we’re all agreed upon.'”

5. Talk With Customers. Every Week.

If you’re a product leader, this should be a “Duh!”

In fairness, though, it’s easy to become preoccupied with the demands of senior executives, the CEO, the Board, your peers, and your own team.

Certainly, the larger the organization, the more demands on your time from people within the organization than without.

But the primary job of product management is an executable product strategy. To do that means spending time with customers.

So it’s imperative product leaders dedicate time to hear directly from their customers.

Even if you have product managers reporting into you, perhaps an entire hierarchy with Directors, Senior Product Managers, Product Owners, etc. on your team, you need to spend time with your customers.

Not so much to get feedback on a specific feature or an interface design, but to immerse yourself in their world — what challenges they’re facing, what trends they’re seeing in their industry, what opportunities they’re pursuing, what defines business and personal success for them.

By doing this, you can not only make sure the current product vision and strategy, even the company mission, is aligned with the needs of your customers, but also identify opportunities to pivot on these things if necessary.

And it enables you to align the every day work with how you’re creating value for your customers.

Disclosure: I don’t know Dan Martell personally, but am a follower. All credit and many thanks for his excellent video in inspiring this post.

13 Myths And Misconceptions About Product Managers

The good news: when it comes to software, product management is now being seen as a legitimate profession and increasingly critical to a company’s growth strategy.

(Ok, maybe it was always thus in Silicon Valley, but the rest of the world is now catching up.)

The bad news: There are still many myths and misconceptions folks have about our profession.

Here are some common ones:

  1. Product Managers are proxies for project managers.
  2. Product Managers are “technical people”, so it’s not necessary to involve them in business, sales, marketing, pricing or (worst of all) strategic discussions.
  3. Product Managers are “technical people”, so naturally they define/understand the database structure, system design, server configurations, etc.
  4. A Product Manager is a “technical role”, so must sit under Engineering or IT.
  5. A Product Manager’s primary (only?) job is writing requirements…
  6. …And how hard can that be? (One of my favorite quotes from non-PMs: “I could write those requirements over the weekend.” Go for it, boss.)
  7. If the product has a technical issue, like something wrong with the data model, SQL stored procedure, or the system design, the PM is responsible and answerable. (Uh, no.)
  8. A Product Manager can come up with a product roadmap without a well-defined product strategy.
  9. A Product Manager can come up with a product strategy without a well-defined business strategy.
  10. A roadmap is simply a case of plotting a bunch of features on a timeline with dates. How hard can that be?
  11. The Product Manager must come up with delivery estimates and dates, and stay true to them no matter what. (Because we product manages are fortune tellers, of course.)
  12. The Product Manager must spend most or all of their time with the development team / in the scrum. (Nope. They must equally spend time, if not more, in the market.)
  13. The Product Manager is “CEO” of his or her product. (Nope. The CEO is the CEO.)

10 Things To Do To Appear ‘Innovative’

Being “innovative” is all the rage nowadays. Companies big and small, tech and non-tech, are striving to seem innovative to employees and customers.

I’ve worked at such companies, and I’ve helped many product managers working at such companies through my product help calls. As such, I’ve seen companies that are actually trying to be innovative, and those that seem more interested in giving the appearance of being innovative.

So here are ten things a company can do to appear innovative than actually be innovative:

#10. Start using buzzwords, like “MVP”, “lean”, “experimentation”, “hypothesis” and “failing fast” without actually understanding what they mean or what they involve.

#9. Visit Silicon Valley a lot, and come back to share stories of t-shirt wearing founders and how everyone there uses Macs.

#8. Start sponsoring and hosting lots of local tech meetups.

#7. Change the office to look more “startupy”. Or better yet, build a brand new one with an open floor plan, sofas, “nap rooms”, and an Xbox.

#6. Offer lots of free food and unlimited sodas, and host “Pizza Tuesdays” and Wednesday afternoon NERF gun battles.

#5. Tell folks at company town halls that you’re embracing innovation. Just keep saying this. Over and over.

#4. Declare that “mobile is the future”.

#3. Enthusiastically share with employees the millions the company is spending to acquire hot tech startups and entrepreneurs (instead of investing in the existing employee talent).

#2. Declare “entrepreneurship” as a corporate strategy. Or better yet, start challenging employees to be more “entrepreneurial”. Make sure they put it in their professional development plans.

#1. Launch an innovation lab. It may not actually do anything real, but this must be done.

Do these 10 simple things and your company can look innovative too.