The Value of Business Value

Business Value is often the holy grail of Product Management (and rightly so) especially when working in Agile.

Business value is genuinely very important; product managers are tasked with building products that offer some real value to somebody. Business values impact almost everything that we do with our product - its positioning, its go to market, its roadmap and its customer centric focus. These core elements of the art of product management are derived from and driven by the business values.

Classically we build things that people want to buy, advancing the business plan of our company. In other cases we may be trying to build infrastructure or experimenting with some novel ideas. However, in almost all cases we can define the objective with business value even if it is a stage or more removed from an actual sale to a customer. I plan to explore business value in these indirect cases in a future post.

So given that business value is one of, if not the primary objective of our professional lives it seems surprising how little attention many of us pay to the business value. Sure we read and write documents with some lip service to the business value. When we do a kick-off meeting we feel forced to generate a couple of statements on the subject and every so on a senior manager will feel the need to talk to even more senior people and have a mini crisis trying to generate a set of business values across all the products that they sponsor. It is possible that this is mainly a feature of big organisations; but my suspicion is that it is a common feature. It is more fun to build and design than to make bold declarations of future business value.

The crux of the issue is that it is really very important and on the critical path of everything that we do. If you are lucky enough to be constantly customer facing then you probably have a pitch maybe even several for different segments, but for the rest of us it is rarely on the agenda.

So here is an idea that I plan to put into action tomorrow - to have a slide deck or excel or some other file with every product that I manage together with its business value. So far, relatively easy, now for the hard part -  to try to keep it updated - say four times a quarter. At most reviews I think it will just be a critical read through and add the review date; but every so often things will change.

I think that this exercise will help in a few ways -

• We will really understand why we are building the product
• We will be able to remain true to the objective and not get inadvertently side-tracked in the natural drift of a dynamic product
• We will make any necessary changes actively after due thought 
• Of course finally we will always be able to provide answers to anybody who needs to know right now

Promoting a Brand - Some thoughts from Richard Branson

I have recently discussed the product aspects of the Nike 10K Night Run. One of the issues that I raised was the value of a brand and how the race was designed to enhance and promote Nike as a sports brand. I also mentioned that Adidas managed to get in on the act by taking advertising space along the route.

I am reading “Screw it – Let's Do It” by Richard Branson the founder of the Virgin group. It is a fascinating book describing how he started out as a school boy entrepreneur and how he developed Virgin. The book itself will be the subject of a future blog.

However, in this blog I want to discuss Branson's insights into branding. The chapter is called Sex Appeal and true to the title he discusses how to make the brand irresistibly attractive. His concept of sex appeal is “A good brand has sex appeal .... the customer falls in love with it, desires it, wants it and buys into it. Sexy is youthful, fun, trendy, cool whatever your age.”

Now at the outset I will concede that I don't think that Branson is just a regular guy doing a regular marketing job – he is a real visionary (there are over 330 Virgin companies) and now that he has success he commands marketing budgets that are, well how shall we say it? – Enough to completely fund the development and launch of 5 or 10 of our best ideas, and a certain fame that brings attention (if not success) to almost whatever he attempts.

Branson also admits that he has enjoyed the stunts he has pulled – from record breaking hot air ballooning to being suspended above Time Square in nude bodysuits. He recounts how one of the pioneers of alternative air travel Sir Freddie Laker encouraged him to be the face of his product, and make the personal commitment.

So I accept that for all of these reasons Branson is not just a regular guy. He is frequently promoting consumer brands rather than the next new killer widget; and so there are many many differences between what he does and what many of us do day in and day out. None the less there are some clear lessons in his messages.

Branson says that he advises all entrepreneurs

“whatever your field, you must be passionate about it and create excitement in everything that you do. Beat your drum, and look beyond the obvious. .... I fully believe that the presentation and image of one's business should reflect the fun as well as all the hard work behind it. In my opinion there are no limitations on what is possible or what should be attempted.”

I think that in 2 or 3 sentences Branson has summarised what Nike were trying to achieve with the night race (notice the similarity between the Nike slogan and the title of Branson's book.)

Of course the brand has to act as a real differentiator the product has to be instantly recognisable - “I will stretch the parameters every time because there is so much competition, you have to stand out from the herd.” However, the promotion and branding must remain faithful to the product - “be true to the product. Don't make it something it's not. Take a good luck at the image you want to promote and go along with it”

Branson also discusses that the products must back up the brand. Having brand alone without the products to match will not work. He describes how he is constantly taking a personal interest in what both the customers and the staff think (“... it is real market research...”) and how the potential for damaging the brand is substantial with poor products. “At Virgin we want to create the most respected brand in the world... but a brand is only as good as your products.”

Part of his philosophy is accountability and engagement – he believes that people need to acknowledge their mistakes, but to engage in the debate and not be debated with no defence or leadership. He comments “it makes me angry to see organisations in crisis that with tens of thousands of employees hiding behind 'no comment.'”

So it is actually pretty clear what the race was all about. It was engaging the customers and making them part of the fun, passion and commitment that they are trying to achieve for their brand and for their image. It was a way of leading the debate, getting their customers involved and trying to stand out from the crowd (ironically, since with 15K runners there was a very strong herd effect!!!)

I think that here are some of the secrets of successful product development and especially product marketing – it needs to be fun, passionate and full of hard work and we need to break down the barriers – so that there are no limitations. Sure there are budget issues and product readiness status, but, we need to work to make sure there are no limits.

Our brand needs to be true to the product and the product needs to be true to the brand. Both the product and the brand need to stand out.

It is critical to listen to our customers to ensure that the brand and the product continually live up to their expectations. A race is one of the rare situations where you can get the customer to offer the commitment and passion in partnership with you, but, you must always get the customer involved.

As product managers and marketeers we must offer a personal commitment to our brand and product, our energy our commitment and our responsibility.

In one sentence - the secret of branding is to offer a personal commitment and work hard to develop and promote a great product that breaks barriers, engages and excites the customers and have a great time in the process.

Finally in Branson & Sir Freddie Laker's words - “If you are starting your own company, a good lesson would be to think very hard about your image and how to brand it. ... get out there and use yourself.”

Screw It – Let's Do It Expanded – Lessons in Life and Business – By Richard Branson 2007 – published by Virgin Books.

The analysis and opinions are mine and do not necessarily reflect those of Branson or of Virgin Books.

Importance of Social Media in Business

Here is an interesting piece on the importance of social media and the probable disconnect at senior levels in Fortune companies, with almost no CEO's being active in social media. This cuts them off from their customers but also the way their customers are thinking.

It has lessons for all PMM - we need to be engaging with our customers effectively and in many markets this means being active in the social networks. This will drive our brand recognition and our competitive positioning.

A 2009 study found that the CEO’s of top U.S. companies tend to avoid social media, according to UberCEO.com. The study found that most of the Fortune top 100 CEO’s were markedly absent from the social media community, including Facebook, Twitter, LinkedIn, and Wikipedia.

Does the Perfect Product exist?

So we all know that one of the hardest things about being a Product Manager is trying to get the product to the market - preferably with most of the required features and in the same decade as the target launch date.

Product timing is critical - often it is better to be in the market with a less than perfect product, getting customers involved and committed than still be in the labs working and missing the opportunity - although a poor offering can do incalculable damage to our product and our brand.

This inevitably forces us to make tough product decisions and compromises on what is in and what is out. We would all like the perfect product, but, in practice we try and define what is good enough. We need to review the product requirements and categorise (in reality recategorise) them into features that are key to the functionality, for example product differentiation and leadership, competitive positioning, key customer commitments (but see this post on balancing customer influence on a release) and usability. There will be many other features, that make sense for the overall product offering, but will not gain customers nor will they loose customers and so sometimes they will just have to wait for the next release.

These calls can be tough and it can take a brave PM to stare down the boss and the market. When Apple introduced the iPhone it was revolutionary (touch screen etc), but at the time it missed some of the key features of a phone that traditional phones already supported (network technology and speed.) Some poor PM in Apple had to make the call and say those features could wait. In this case it worked.

Sometimes, however, the choice is less successful and worse some minor features get delayed from release to release without a solution. So following on from my analysis of Nike getting some marketing issues wrong - here are some thoughts about a place were Google gets it wrong.

Briefly, when you build a website, two of the key stages in launching it are to submit the site to the major search engines together with its sitemap.

Now when we built this blog we built it on a Google platform, and naturally assumed that submission to Google would be automatic. Not so - a few weeks on and we realise that we seemingly need to submit and that the submission is from a different set of Google tools and not the blog control panel. Even more frustrating, building the site map probably isn't automatic and doesn't always work the way they say. Or maybe it is automatic - depends who you believe - the Google support guy on one of the forums or the official instructions. Worst of all - this saga seems to have a history judging by the support forums and QA pages.

So given that these tools are for the general public - the user experience could have been so much smoother. Maybe there is a very good reason why submission isn't automatic - but it is hard to see why this couldn't have been properly explained and a couple of items included in the blog set up wizard. True in this case they didn't loose me as a customer, but they almost did see me checkout a different blogging platform.

To wrap it up - we need to compromise on our dreams for our products, failure to do so can ruin our chances to get market share, but, we need to make sure that we don't compromise too much. We need to listen to our customers and fix the things that we missed or omitted the first time round, failure to do will also ruin our market share in the longer term.

Creating a Product Road Map

“Follow the yellow brick road” - this is the instruction that Dorothy got in order to get to Emerald City.

Product managers are responsible for building the product’s yellow brick road – the Product Road Map.

The road map generally should normally be planned for a 3 year period at a high level and for 18 months in a more detailed manner.

Probably the most important starting point for the road map process is the outcome of the strategic business process of the company. This is a critically important process performed periodically (often annually) by the senior management of the company together with the marketing team and actually drives the entire company. When we start to create or update the road map the last version of the strategic process is a major input.

Often this will be replaced or supplemented by a product strategic process where we systematically look at all aspects of the product and the market and set key business objectives within the overall corporate strategic framework.

The road map process starts with information collection which should include the following:

• Market trends
• Regulatory trends
• Technology directions
• Competitive analysis
• Customer requirements and suggestions

In the next step we need to analyze what is the likely impact of each item on the product and what we can or should be do in order to give the best response to the probable impact. The best way is to create a product requirements matrix with all the needed activities, new features, platform changes, etc. and then to prioritize this list.

Having done that, we need to figure out what is required in the development of each element in the matrix. We must get the rough effort estimation and / or the budget needed. Now we have the information needed in order to make decisions and to create a road map release plan, if possible for a 3 year period, but not less than 18 months.

Needless to mention that during all the process described here we need to drive internal collaboration and buy in by involving and getting the opinions of many other groups from within the organization for example marketing, R&D, sales, operations and so on.

This is a cyclic process, since we need to do it again at least once or twice a year and adjust the road map if needed.

The decision whether to let our customers be involved in the road map or more precisely to what extent they should be involved is not an easy one. See this article for some of our thoughts in this area. Generally we need to make the product ready for market, but at the same time, we need to be careful not to let the road map drift in the direction of one or two (big) customers, but, is not in line with the general market direction.

We should be very careful when externalize the road map document since it is has some legal status as a kind of contract and as such we need to enter all the needed legal and financial disclosures.

Hopefully this road map will lead us to Emerald City.

In subsequent blogs we will look at ways to share the roadmap internally and externally, getting internal buy in and some of the methods available to do competitive analysis and technology reviews.

Product Management & Marketing - The Longest Race

A few weeks ago, I was fortunate enough to run the 4th Annual Nike Tel Aviv 10K night run. Now 10K isn't the longest distance in the world, but it is long enough to enjoy the atmosphere (amazing) and to reflect on many different things whilst running.

Sad to say perhaps, but, whilst pounding the streets I managed a few thoughts on product management.

Organising a run with over 15K runners is a real task - coordination with the city, the police, bands, official running shirts, refreshments, web site for registration and results - clearly a massive project & clearly some top class organisers were behind this event.

However, there were many product lessons to be learnt. The race organisers claimed that the other Nike night runs in Europe have been abandoned this year and that our race was the sole survivor. So clearly we see that there was some effective market segmentation and strong brand/product recognition in the local market.

On the subject of brand recognition Nike (not normally slow in these areas) let the competition steal a trick on them - guess which company managed to get its posters on lots of billboards along the route? (So a clue then - Adidas) - so some poor promotion & competitive positioning here.

One of the main questions that we should consider is what is the product and what is the Key Value Proposition that they were promoting? Trivially, this was a race, but probably that isn't really the intention of the organisers; it was probably more along the lines of

to produce a mass street happening in an important city; promoting an active good time to sporty people who are likely to identify with our brand. The aim is also to attract people who previously would not have taken part in an event like this to participate.

This emphasis makes for a completely different plan driving them towards providing bands and music along the route, promotion on Facebook even the choice of the date - 10.10.10.

The local product management obviously worked hard at getting buy in from stakeholders - both in house (Nike management) and outbound keeping the city interested despite this was no longer a global effort. Not to mention trying to maintain product momentum in keeping the customers (we runners) very happy.

I guess we will never know, but it would be interesting to find out - if with all the cross branding (water, yogurts and granola bars) & other cross product promotion (Nike stores) what were the financial objectives of the event? Did the race actually make a profit - not that this is necessarily the objective. It would be acceptable to under-take a loss making activity in the right context. It would also be interesting to know (given this was a unique event this year) whether there was a process of strategic review of alternatives.

So much for the planning and product development, in the next post I will discuss some of the results (product, not my personal time) and suggest some possible conclusions.