Lean Product Management @ SDEC13, Winnipeg

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The rise of the Lean Startup has led to a deeper understanding of the importance of validating business ideas, from new features to new business models. But many tools available to the Product Owner aren't adapted to rapid validation. Starting from the principles and practices of agile product management, from defining the product vision to creating story maps and refining the product backlog, you will learn about key practices that incorporate the lean startup principles, allowing a Product Owner to bring the build-measure-learn cycle alive and ultimately earn more value more quickly.

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Lean Product Management @ SDEC13, Winnipeg

  1. 1. Lean Product Management And why I should care agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  2. 2. “No matter how good the team or how efficient the methodology, if we’re not solving the right problem, the project fails.” Woody Williams agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  3. 3. Understanding depends on Length of Feedback Cycle agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  4. 4. Length of Feedback Cycle driven by Cost of Change x Cost of Validation agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  5. 5. Economists In November 2007, economists in the Survey of Professional Forecasters — examining some 45,000 economic-data series — foresaw less than a 1in-500 chance of an economic meltdown as severe as the one that would begin one month later. agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  6. 6. vs Weatherman http://www.nytimes.com/2012/09/09/ magazine/the-weatherman-is-not-amoron.html In 1940, the chance of an American being killed by lightning was about 1 in 400,000. Today, it’s 1 in 11 million. agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  7. 7. Cost of Change agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  8. 8. Assembly Line Manufacturing has a high cost of change http://www.archives.gov.on.ca/english/on-line-exhibits/d-day/big/big_03_airline_assembly.aspx Archives of Ontario, Reference Code: C 190-5-0-0-21 agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  9. 9. Inclusive thinking • In software development high cost of change leads to inclusive thinking • Any and every idea has to be captured in the first version of a requirements specification • Creates waste - bloated documents, unwanted features and entitlement thinking Feature usage in enterprise software Never Rarely Sometimes Often Always 7% 13% 45% 16% 19% Standish Group - CHAOS Report, 1995, 2002 agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  10. 10. Cost of Change Hypothesized Requirements Capture all possible needs Detail of Requirements agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  11. 11. New programming languages and versions released 110 104 88 66 10 x 44 50 41 25 22 0 11 1954-1959 12 1960-1964 1965-1974 Increasing Choice in Technology Environments agile42 | We advise, train and coach companies building software 1975-1984 1985-1994 1995-2004 Language types and versions released per decade, taken from O’Reilly’s Programming Language Timeline www.agile42.com | All rights reserved. Copyright © 2007 - 2009.
  12. 12. Object-oriented languages Software Development has commoditized cost of change Ruby on Rails jquery Coffeescript Continuous Delivery agile42 | We advise, train and coach companies building software Iterative & Incremental Methods www.agile42.com | All rights reserved. Copyright ©2007-2013
  13. 13. Cost of Change Hypothesized Requirements Evolving Requirements Capture all possible needs Emerging needs as development progresses Detail of Requirements agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  14. 14. Cost of Validation agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  15. 15. Shifting Paradigms B.G.|A.G. “I know that half of my advertising budget is wasted, but I’m not sure which half” Lord Leverhulme http://www.marketingprofs.com/charts/2009/3161/more-smbs-use-online-media-than-traditional http://marketing.blogs.ie.edu/archives/2011/01/trends-in-online-advertising-in-2011-in-the-united-states.php agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  16. 16. Usability Testing - c.2006 agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  17. 17. Usability Testing - today http://welovelean.wordpress.com/2012/01/29/15-essential-tools-every-lean-startup-cant-li/ agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  18. 18. Changing paradigms • If change is cheap, requirements can change continuously • We can evolve our thinking as we learn more about the product we are building • Maximizing Return-onInvestment means validating new ideas early, before the total investment cost has been spent agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  19. 19. Designed by KISSmetrics agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  20. 20. Cost of Change Hypothesized Requirements Evolving Requirements Validated Requirements Capture all possible needs Emerging needs as development progresses Lean Startup experiments Detail of Requirements agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  21. 21. 5 Levels of Learning agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  22. 22. Five Levels of Planning Annually Define a vision Roadmap  Planning Bi-­‐annually Rank features in order of delivery Release  Planning Vision  Planning Quarterly Plan stories to be delivered during next release cycle Bi-­‐weekly Sprint planning, focussing on delivery of sprint goal Daily Focus on daily planning of team activities Vision  Planning Roadmap  Planning Itera3on   Release  Planning Planning Daily   Planning 5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006) agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  23. 23. Product Vision Customer Behavioural Models agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  24. 24. Five Levels of Planning Learning Vision  Planning Roadmap  Planning Release  Planning Vision  Planning Long-­‐term Validate understanding with Medium-­‐term Lean (or Customer Experience) Canvas Regularly Minimum Viable Product. Validate ideas before fully committing investment Bi-­‐weekly Product Owners, Delivery Team Daily Product Owners, Delivery Team Roadmap  Planning Itera3on   Release  Planning Planning Daily   Planning Define & refine behavioural models we are testing? Pivots happen here. 5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006) agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  25. 25. “In a nutshell, the job of the product organization is to make that vision a reality.  So we don't work for a few weeks or even a few months and then just declare it's not happening and we should do a pivot.  We will typically work hard for many months on a product vision and not even entertain the possibility of giving up.” Marty Cagan http://www.infoq.com/news/2013/07/pivoting-product-development agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  26. 26. Validated Learning • Understand the problem a feature will solve • Decide how to ask if your customer cares • Validate before investing complete cost agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  27. 27. The Scientific Method Theory Use the theory to make a prediction Modify or change your theory Observe Prediction Design an experiment to test the Run the experiment agile42 | We advise, train and coach companies building software Experiment www.agile42.com | prediction All rights reserved. Copyright ©2007-2013
  28. 28. The Theory of General Relativity Gradual acceptance of General Relativity over Newtonian Mechanics Einstein’s Theory of General Relativity Einstein’s prediction (1907) Observations validated General Relativity Light bends in a gravitational field Wait for 1919 solar Arthur Eddington eclipse to observe observed that Light did whether or not light bend around the sun Solar Eclipse of 1919 bends around the sun http://thethoughtstash.wordpress.com/2011/01/03/how-eddington-demonstrated-that-einstein-was-right/ agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  29. 29. Applied to an Online Experience User Model Use the model to make a prediction Modify or change your user model Validate Prediction Design an experiment to test the Run the experiment agile42 | We advise, train and coach companies building software Experiment www.agile42.com | prediction All rights reserved. Copyright ©2007-2013
  30. 30. Requirements Definition User Story Mapping and the Lean Canvas agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  31. 31. Five Levels of Planning Learning Vision  Planning Roadmap  Planning Release  Planning Vision  Planning Long-­‐term Validate understanding with Medium-­‐term User Story Mapping and Lean Canvases Regularly Minimum Viable Product. Validate ideas before fully committing investment Bi-­‐weekly Product Owners, Delivery Team Daily Product Owners, Delivery Team Roadmap  Planning Itera3on   Release  Planning Planning Daily   Planning Define & refine behavioural models we are testing? Pivots happen here. 5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006) agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  32. 32. User Story Mapping is a powerful tool for understanding your product from the perspective of the user agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  33. 33. Known Unknowns Recognize there are gaps in your vision/business model, and look to fill those gaps in as quickly as possible Map of Africa, 1824 agile42 | We advise, train and coach companies building software http://culturalstudieslectures.blogspot.com/2012/01/ lecture-one-on-question-what-is.html www.agile42.com | All rights reserved. Copyright ©2007-2013
  34. 34. Lean Canvas: Ash Maurya 1. Problem 4. Solu-on top  3  problems top  3  features Exis3ng   alterna3ves 8.  Key   metrics 3.  Unique   9.  Unfair   2. advantage Customer   value   Not  easily  copied   proposi-on or  bought segments Clear  compelling   message.  Why   makes  you   different?   e.g.  AARRR 5. Channels Path  to  customers Target  customers Early  adopters? 7.  Cost  Structure 6.  Revenue  streams Customer  acquisi3on,  distribu3on,  people,   etc. Revenue  model,  life  3me  value,  revenue,   gross  margin Product Market Lean  Canvas,  from  Ash  Maurya:  Running  Lean.  Licensed  under  Crea3ve  Commons-­‐APribu3on-­‐Share  Alike  3.0 agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  35. 35. Lean Project Canvas <Title  /  headline> Problem Leading  and  lagging   indicators Channels Path  to   customers Business  value 1.  User  &  business  value 2.  Cost  of  Delay  (urgency) 3.  risk  reduc-on/opportunity  enablement +  Objec-ve  jus-fica-on 1,2,3,5,8,13,21 Market agile42 | We advise, train and coach companies building software Possible   solu-ons linear time Business   readiness What  is  needed   to  deploy  and   support  the   solu3on? Key  features  &   benefits  for   customers  &   business (Staff,  budget,  training,   systems,  support,  opera-ons   dependencies  on  projects/ vendors) Costs Cost  of  delay delay cost Exis3ng  / alterna3ve   solu3ons Success   metrics Early  adopters? Top  3  problems Customer   segments People,  training,  capital,  marke-ng,  etc. +  Objec-ve  jus-fica-on 1,2,3,5,8,13,21 Product www.agile42.com | All rights reserved. Copyright ©2007-2013
  36. 36. Interaction Model Backlog To Do For <target group> Validation Doing Observation Execution Validated? Who <has a specific need> Doing Deployed Idea #1.1 The <product name> Is A <product category> That <key benefit> Idea #1.2 Unlike <primary competitors> Our Product <additional advantages> Pathway #1 Pathway #2 Idea #1.4 Idea #1.3 Idea #1.5 Idea #1.6 Idea #2.3 Idea #2.1 Idea #2.4 Idea #2.2 Level of Detail / Close to done •Visualize your User Interaction Model and adjust it as you learn •Come up with ideas for each pathway •Prioritize experimental testing •Spend time on measurement infrastructure (a test without ability to measure = an unvalidated feature) •Always revisit validation tests for size •The execution board is equivalent to the team’s task board, but at the Idea Card level
  37. 37. Release Planning - the Minimum Viable Product agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  38. 38. Five Levels of Planning Learning Vision  Planning Roadmap  Planning Release  Planning Vision  Planning Long-­‐term Validate understanding with Medium-­‐term User Story Mapping and Lean Canvases Regularly Minimum Viable Product. Validate ideas before fully committing investment Bi-­‐weekly Product Owners, Delivery Team Daily Product Owners, Delivery Team Roadmap  Planning Itera3on   Release  Planning Planning Daily   Planning Define & refine behavioural models we are testing? Pivots happen here. 5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006) agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  39. 39. Zappos famously launched without stock, selling shoes from their local specialist show store agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  40. 40. Minimum Viable Product A Minimum Viable Product may be an entire product or a sub-set of product (such as a feature): • Product - The canonical MVP strategy for a web application is to create a mock website for the product and purchase online advertising to direct traffic to the site. The mock website may consist of a marketing landing page with a link for more information or purchase. The link is not connected to a purchasing system, instead clicks are recorded and measure customer interest. • Feature - A link to a new feature in a web application might be shown in a prominent location on the website. The feature is not implemented, rather an apology, mock-up, or marketing page is provided. Clicks of the link are recorded and provide an indication as to the demand for the feature in the customer base. It is ALWAYS smaller than you think! agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  41. 41. Sticky Note Moment agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  42. 42. Validate Everything agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  43. 43. One test is worth a thousand expert opinions. Wernher Von Braun agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  44. 44. “I can’t say it any better, HiPPO’s rule the world, they over rule your data, they impose their opinions on you and your company customers, they think they know best (sometimes they do), their mere presence in a meeting prevents ideas from coming up.  The solution to this problem is to depersonalize decision making, simply don’t make it about you or what you think. Go outside, get context from other places. Include external or internal benchmarks in your analysis. Get competitive data (we are at x% of zz metric and our competition is at x+9% of zz metric). Be incessantly focussed on your company customers and dragging their voice to the table (for example via experimentation and testing or via open ended survey questions). Very few people, HiPPO’s included, can argue with a customer’s voice, the customer afterall is the queen / king! : )” Avinesh Kaushik, kaushik.net agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  45. 45. Depersonalize Decision Making • “HiPPO’s” rule the business world • It is never about you, it can’t be about you • Benchmarking is awesome  • Leverage competitive analysis  • Experimentation / testing rock • Execution strategy:  • Transparency, standardization, looking outside in  • Be a slave to customer centricity (its about your customers (internal & external)) agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  46. 46. “Data is like garbage.  You’d better know what you are going to do with it before you collect it.” Mark Twain agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  47. 47. Vanity vs. Actionable Metrics Vanity metrics (like web hits or number of downloads) which only serve to document the current state of the product but offer no insight into how we got here or what to do next. An actionable metric is one that ties specific and repeatable actions to observed results. agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  48. 48. get good at celebrating learning agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright © 2007 - 2009.
  49. 49. How Much Effort on Validation • In 2009, Google ran approximately 12,000 experiments, of which about 10% led to business changes Feature usage in enterprise software Never Rarely Sometimes Often Always 7% • Linus Pauling famously said, "The best way to have a good idea is to have a lot of ideas." • Focus on minimizing the incremental cost of testing ideas with your customers/users 13% 45% 16% 19% Standish Group - CHAOS Report, 1995, 2002 agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  50. 50. Length of Feedback Cycle driven by Cost of Change x Cost of Validation agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013
  51. 51. Feedback loops make all the difference In 1940, the chance of an American being killed by lightning was about 1 in 400,000. Today it’s 1 in 11 million. http://www.nytimes.com/2012/09/09/ magazine/the-weatherman-is-not-amoron.html agile42 | We advise, train and coach companies building software In November 2007, economists in the Survey of Professional Forecasters — examining some 45,000 economic-data series — foresaw less than a 1-in-500 chance of an economic meltdown as severe as the one that would begin one month later. www.agile42.com | All rights reserved. Copyright ©2007-2013
  52. 52. “The race doesn’t go to the one with the best idea, but to the one with the most tested ideas” Lean Product Management • Agile drives incremental cost of change down • Lean Startup leverages falling cost of validation • Feedback means nothing without a model Photo: ESA http://www.nbcnews.com/id/50677062/ns/technology_and_science-space reserved. Copyright ©2007-2013 agile42 | We advise, train and coach companies building software www.agile42.com | All rights
  53. 53. “Coming together is a beginning. Keeping together is progress. Working together is success.” Henry Ford thank you dave.sharrock@agile42.com twitter: @davesharrock slides: slideshare.net/davesharrock agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright © 2007 - 2009.

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