Using Lean Principles to Create and Get Traction for Your Product Strategy

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I interviewed over two dozen product management professionals across the country who told me they HATE preparing business cases, calling them "a joke," "guesswork," "pretend," and even "evil". On top of that, they said their #1 challenge was getting internal buy-in and managing stakeholders.

The fact is we lack the tools to be able to craft and sell our product strategy. PowerPoint and Word just don't cut it. And in any case, no one ever really reads them.

In this session at ProductCamp DC 2013, I shared my experience of using the principles of Lean Startup, Customer Development and Running Lean to quickly capture my product vision, and then systematically de-risk it, while developing traction among internal stakeholders.

(Note: Lean Startup, Customer Development and Running Lean were developed by Eric Ries, Steven Blank and Ash Maurya, respectively.)

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Using Lean Principles to Create and Get Traction for Your Product Strategy

  1. 1. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Using Lean Principles to Create and GainTraction for Your Product StrategyShardul MehtaPresented at ProductCamp DC, May 11, 2013
  2. 2. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Important Stuff!1This material is licensed to you under the CreativeCommons Attribution-ShareAlike 3.0 Unported License.View the license athttp://creativecommons.org/licenses/by-sa/3.0/
  3. 3. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Hi. I’m Shardul.• Almost two decades years building and launching tech/software products• Early career: software developer – Honeywell, First USA Bank (Chase)• Co-founded cloud based healthcare dot-com start-up in 2000• Product management, product marketing, product development– Small business– Mid-sized company in consumer services and retail that grew from $250M to $1B– Led digital product management for Capital One’s Card online UX• Founded ProductCamp DC in 2010: largest product professionals communityin the Mid-Atlantic• MBA, Tepper Business School, Carnegie Mellon• B.S., Computer & Information Sciences2@shardulmehta http://www.linkedin.com/in/shardulmehtahttp://streetsmartproductmanager.comshardulmehta@gmail.com
  4. 4. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.CHALLENGESUsing Lean Principles to Create and Gain Traction For Your Product Strategy3
  5. 5. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Problem #1The traditional product innovation process is wasteful4
  6. 6. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.The conventional way is to write a business case5ConceptBusiness Case/ProductStrategyGet Approval Execute• Resources• Money
  7. 7. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Elements of a business case, business plan, product strategy6• Executive Summary• Project name• Business objectives and businessstrategic alignment• Market/industry analysis• Competitive analysis• Product description• Target customer• Sales and marketing plan• Operational plan• Scale and complexity assessment• Financial analysis, investment needs,break-even analysis, ROI• Organizational areas impacted(internally and externally), keystakeholders, dependencies• Project plan and schedule, critical path• Required resources - project leadershipteam, project governance team, teamresources, funding• Commitments (required) - Projectcontrols, reporting processes,deliverables schedule, financialbudget/schedule
  8. 8. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.How I used to capture my ideas7
  9. 9. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.So…8ConceptHow do I gofrom this…Business Case• Executive Summary• Project name• Business objectives and business strategic alignment• Market/industry analysis• Competitive analysis• Product description• Target customer• Sales and marketing plan• Operational plan• Scale and complexity assessment• Financial analysis, investment needs, break-even analysis, ROI• Organizational areas impacted (internally and externally), keystakeholders, dependencies• Project plan and schedule, critical path• Required resources - project leadership team, projectgovernance team, team resources, funding• Commitments (required) - Project controls, reporting processes,deliverables schedule, financial budget/scheduleTo this?BusinessCase?Concept doc?MRD?Too much work = wasteful
  10. 10. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Too many unknowns9ConceptBusinessCaseGetApprovalExecuteYou have few factsYour goal: learningYour investor’s goal: growth(a.k.a., write abig document)• What assumptions underlie your strategy?• Have you de-risked your plan?• Have you found early adopters?• Are their problems worth solving?• What key metrics will drive your financials?Have you builtsomething customerswant?(Too late to learn?)
  11. 11. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Problem #2“Plan != Product”10- Steve Wendel, @sawendel
  12. 12. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.11A business case is a document executives makeyou write that they don’t readProduct strategy deck, Concept doc, MRD, etc…With due respect to Steve Blank’s comment of the similar nature
  13. 13. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.No love for the business case12“It’s a necessary evil. But it’s a wasteful process.”“It’s a joke.”“It’s a manager fighting with an Excel spreadsheetfor a month.”“I’m forced to project revenues out of thin air.Putting revenue projections is a nonsensicalexercise.”“A business case is just a lifeless PowerPoint deck.”Loveforincludingfinancials…NOT!“Currently, we have to fill out a ProjectEngagement Request Form that asks fornumbers. But it’s all guesswork. It’s a waste.”“Financial analysis – it’s really just pretend.”“It means showing them a model where you losemoney in the beginning in the hopes of makingthe volume later. I don’t like this approach.”“Typically what happens is you build the businesscase, and then because you can’t guarantee theresults the execs ask you to do more research.”“You are describingmy life!”“People inflate their numbers.”“It took months and months to get through thebusiness case.”“I need to build a horse by committee and I got acamel.”“Decisions are sometimes made for stupidreasons. Especially in large organizations.”“There’s a desire to apply existing[corporate] structure to pursuing ideas. Thistakes away the need to be scrappy. It resultsin the pursuit of metrics that you want to tellyour version of the story [as opposed to thecustomer’s]. The product plan, even whenapproved, is often very lame, timid and onlydesigned to help achieve metrics sufficient tosecure bonus payouts.”
  14. 14. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Problem #3Managing internal stakeholders is hard13#1 challenge
  15. 15. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Too many cooks in the kitchen• Lots of opinions• Lots of approvals• Competing agendas• Keeping everyone on the same page• Capturing and addressing concerns• Following up• Need an executive sponsor/champion14
  16. 16. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Ok! So what do we do?We need to apply lean thinking to formulatingand getting buy-in for product strategy15
  17. 17. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Applying lean principles to get there1. Capture your initial product vision in a way that’s concise andeasily sharable– Minimize documentation upfront (save trees)– Write the business plan/case, MRD, etc. later2. Use validated learning to test each aspect of your productstrategy3. Identify and develop your stakeholders4. Know how to communicate progress16
  18. 18. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.CAPTURING YOUR PRODUCTVISIONUsing Lean Principles to Create and Gain Traction For Your Product Strategy17
  19. 19. Customer SegmentFor whom are we solving aproblem?For whom are we creatingvalue?Early Adopter:Who is a potential earlyuser of the solution?ProblemWhat are the top 3-5problems faced by our targetCustomer Segment?Unique Value PropositionHow are we uniquely going to solveour customer’s problems or satisfytheir needs?A single, clear, compelling messagethat states why you are different andworth buying.SolutionWhat are the top 3-5 wayswe are going to solve theproblems faced by ourCustomer Segment?Key SuccessFactorsHow will we measuresuccess?What key metrics are wetrying to move?Existing AlternativesHow are they solving theproblem today?ChannelsHow will we get (acquire), keep(retain) and grow (sell more toexisting) customers?Get/Acquire: How will we driveawareness, interest, activation,usage?Keep/Retain: How will we keepcustomers coming back?Grow: How will we up-sell/cross-sellcustomers, encourage referrals?Key StakeholdersWho are the most importantstakeholders whose buy-inwe need?Which executives do we needto convince?Who will be our executivechampion?Who are the key influencersto these stakeholders?Who else do we need toinclude in our coalition-of-the-willing?Key Resources &PartnersWhat are the criticalinternal and externalresources we need todeliver the solution to thecustomer?Revenue/Business ValueWhat is the business value of delivering the product/service/capability? (E.g.,drive revenue, save money, increase CSAT, competitive differentiator, marketpositioning, etc.)Cost StructureWhat are most important costs inherent in our product model?Which Key Resources are most expensive?Which key activities are most expensive – product development, marketing,customer support?PRODUCT MARKETMARKET/CUSTOMER PRODUCT/BUSINESSProduct CanvasProduct Canvas is adapted from The Business Model Canvas (http://www.businessmodelgeneration.com)and is licensed under the Creative Commons Attribution-ShareAlike3.0 Unported License.To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/or send a letter to Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.© Shardul Mehta 2013http://streetsmartproductmanager.com
  20. 20. USE VALIDATED LEARNINGUsing Lean Principles to Create and Gain Traction For Your Product Strategy19
  21. 21. Customer SegmentEarly Adopter:Problem Unique Value Proposition Solution Key MetricsExisting Alternatives Channels Key Stakeholders Key Resources &PartnersRevenue/Business Value Cost StructurePRODUCT MARKETMARKET/CUSTOMER PRODUCT/BUSINESSA made up exampleProduct Canvas is adapted from The Business Model Canvas (www.businessmodel.canvas.com)and is licensed under the Creative CommonsAttribution-ShareAlike3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/or send a letter toCreativeCommons, 444 Castro Street, Suite 900, Mountain View, California,94041, USA.© Shardul Mehta 2013http://streetsmartproductmanager.comMortgagecustomers•Active onlineservicing user•Current chkgacct customer•Rewards user•$400k+ homepurchase priceAll your bills inone place•View all bills(utility, etc.)•Pay billsthrough onlinebank servicing•Direct debitfrom bankaccount•Earn Rewards•Mail•Online servicingportal•Social mediapromotionalcampaign•Branches, tellers•Bank BillPay(can’t view bill,though)•Manilla.com•Don’t wantpaper bills•Paying at eachservice’s site istedious•Some vendorscharge eCheckprocessing feesExecutiveSponsor:Business VP/GMVP PMSVP OpsVP DigitalServicing•Free for customers•Customer Lifetime Value benefit•Fee to service providers•IT development cycles•Marketing costs•Integration costs•Payment processing feesIT capacityBrandOpsBranchesServiceproviders
  22. 22. 11/1/12 Confidential 21VALIDATED LEARNING BOARDUNTESTEDIN PROGRESS DONERisk/Assumption Build Measure LearnWho are my earlyadopters?EXPERIMENT: Landing pagetest on UserTesting.comFALSIFIABLE HYPOTHESIS:80% of 100 participants willvalidate the messagingDoes the UVPmessagingresonate?Can integrationwith serviceproviders be donecost-effectively?Is this a problemworth solving?Compete withProject Gold forprioritization?IT capacityavailable?Will serviceproviders pay forit?EXPERIMENT: Interviewswith 20 service providersFALSIFIABLEHYPOTHESIS: 80% willvalidate value prop ofour service
  23. 23. “DEVELOP” STAKEHOLDERSUsing Lean Principles to Create and Gain Traction For Your Product Strategy22
  24. 24. Stakeholder Department Role Current Priorities My Hypothesis Result StatusName of theStakeholderHis or herdepartmentIs he or she aDecision Maker,Influencer,ExecutionPartner?(Or have norole to play?)What are his or hercurrent priorities,challenges,opportunities?Do I think he or she will be infavor or opposed? Is there a fitwith one of their current orplanned initiatives?Is there a particularly areawhere they are likely to raisean issue, such as questioningthe customer need, resourceconstraints, etc.Result of theconversation.Were myhypothesesvalidated orinvalidated?Mark him orher as aSupporter,Detractor orN/A.Stakeholder Development TrackerThe Stakeholder Development Tracker is licensed under the Creative Commons Attribution-ShareAlike 3.0 Unported License. To view a copy ofthis license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 444 Castro Street, Suite 900, MountainView, California, 94041, USA.© Shardul Mehta 2013http://streetsmartproductmanager.com
  25. 25. COMMUNICATE PROGRESSUsing Lean Principles to Create and Gain Traction For Your Product Strategy24
  26. 26. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Communicate progress is critical for ongoing support• Updated Product Canvas reflects current evolution of productstrategy• Validated Learning Board can be shared in detail or summary toarticulate progress– Progress can be summarized in this format:N Untested, X In Progress, Y Validated, Z Invalidated• Stakeholder Development Tracker can be shared with manager,executive sponsor to communicate internal traction– Also to raise roadblocks and ask them to play interference• Supporting detail can always be added– Experiment reports, market research data, detailed financial analysis, etc.25
  27. 27. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Benefits Fast Concise Portable Collaborative• Easily shared• Easily readable and understood• Common language• Not meant to replace a business case/plan, MRD/PRD or user stories– But they can come later26
  28. 28. © Shardul Mehta 2013http://streetsmartproductmanager.comThis work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 UnportedLicense. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letterto Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.Interested in applying lean principles to product innovation?• Get your copy of the Product Canvas here:http://streetsmartproductmanager.com/product-canvas/• Or email me• More information:– Product Canvas: http://wp.me/pQmRk-7x– Validated Learning Board: http://wp.me/pQmRk-am– Stakeholder Development Tracker: http://wp.me/pQmRk-8l• I also offer workshops27@shardulmehta http://www.linkedin.com/in/shardulmehtahttp://streetsmartproductmanager.comshardulmehta@gmail.comMore tips & techniques onapplying lean concepts

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