In the agile transformation organisations sometimes rely on implementing Scrum or some other agile frameworks. Scrum should make the company agile and customer centric. But the Scrum guide is incomplete by purpose. It only has a very limited set of tasks a product manager need to fulfil (Developing and explicitly communicating the Product Goal, Creating and clearly communicating Product Backlog items, Ordering Product Backlog items and Ensuring that the Product Backlog is transparent, visible and understood. [1]). How to create the product coal and any product backlog item refereeing to this goal is not part of scrum. This is where most companies get stuck in their agile transformation, as they tend to create the product goal and product strategy inside-out, top-down as usual. At this point, companies often wonder where the promised agility for success will lie.
Product led refers to growth strategy where the product is the primary driver of customer acquisition, engagement, and revenue. This approach prioritizes the user experience and focuses on building a product that is so valuable that it can drive customer acquisition and retention on its own, with less relying on traditional sales and marketing tactics. This approach is often used by software companies and can be contrasted with a traditional sales-led approach where the primary driver of growth is sales and marketing efforts.
Being product-led instead of sales-led brings some advantages for companies.
Cost-effective: Product-led growth relies on the product to drive customer acquisition and retention, which can be more cost-effective than traditional sales and marketing efforts.
Greater customer engagement: When the product is the primary driver of growth, it means that the company is focused on building a product that is valuable to the customer. This can lead to greater customer engagement and loyalty.
Data-driven: Product-led companies tend to be more data-driven, as they rely on data to understand how customers are using the product and to make informed decisions about product development.
Scalability: Product-led companies can scale more effectively as they rely lesss on salespeople to generate leads and close deals.
Overall, product-led companies tend to be more customer-centric, data-driven and scalable, while sales-led companies tend to be more sales-centric. Being product-led is clearly given advantages but the transformation is hard. In the following I describe some useful steps to become a more product-led company.
Product vision and strategy
Define your product vision and strategy: Clearly define what problem your product solves, who your target customer is, and what value it provides. If your strategy does not match your daily business or the daily business does not match your vision and strategy you are doing it wrong. A vision is not a set of actions, it is a clear goal what you want to achieve. This way anybody in the company is able to focus its work on reaching the goals.
Product people and manager need to sit down as long as it takes to have a product vision that is understood and supported by everyone.
Customer feedback
Prioritize customer feedback: Make sure you are gathering feedback from your customers on a regular basis and using it to inform product decisions. Do not try to define the needs of your software development inside-out. Only your customer knows what is needed.
Don’t be afraid. Go ask your customers what their biggest problem is you need to solve.
Product-focused culture
Build a product-focused culture: Ensure that everyone in the company understands the importance of the product and is working towards the same goals. Very often the different departments within the company (sales, consulting, marketing, …) do have very different goals in their daily work. Sales normally don’t care about being product centric. They need to sell whatever the next new customers need. Whether this is out of scope of your current product, or makes other customers unhappy is not important within the sales process.
Remove incentives on salespeople to sell more and more. Let them work instead to have the best product available on the market, to gain new customers.
Metrics
Focus on retention and growth: Measure the success of your product by looking at metrics such as customer retention and growth, rather than just acquisition.
Happy customers will lead to more customers. Make sure you have an idea what problems you need to solve for your customers need and how happy they are. This way you will easily get more customers.
Don’t stop!
Continuously improve and iterate: Use customer feedback, data, and testing to continuously improve and iterate on the product.
You are never finished with your product and you will never have ended to become even more product-led. Don’t stop taking the next step to get a better product.
In product development, organizations are increasingly shifting their focus from a service-oriented approach to a product-first mindset. This strategic transition involves prioritizing the enhancement and innovation of newer products, while limiting investments in legacy offerings. To gauge the success of such a transformation, it becomes crucial to track key metrics that provide insights into the effectiveness of the product-first approach. In this article, we delve into two essential metrics-developer time spent on old products and the number of tickets related to legacy offerings-as powerful indicators of progress towards a product-centric strategy. Let’s explore how these metrics can help evaluate and drive the effectiveness of your organization’s product-first approach.
At its core, the product-first approach centres around delivering exceptional value by focusing on features and improvements that truly elevate the product’s quality and user experience. It involves a deliberate decision not to implement every customer request, but instead to invest in those that contribute to making the product great. By waiting for a critical mass of customer demand before introducing new features, organizations can optimize their resources and prioritize development efforts to align with market needs. Furthermore, self-service options are embraced to empower customers, reducing reliance on extensive consulting and support.
Assessing Developer Time Spent on Old Products
One key metric for evaluating the success of a product-first approach is the time developers spend on old products. By tracking and analysing the allocation of developer resources, organizations can gain insights into their focus and priorities. A reduction in the time dedicated to maintaining and supporting legacy offerings indicates a successful transition towards prioritizing newer products. This shift signifies a commitment to innovation, as resources are redirected towards enhancing the quality, functionality, and overall value of flagship products. Ultimately, it enables organizations to respond more swiftly to market demands, fostering greater customer satisfaction and a competitive edge. When organizations reduce the time spent on old products, it signifies a fundamental change in their development mindset. It reflects a strategic decision to shift the balance from maintaining outdated solutions towards investing in the continuous improvement of newer offerings. By dedicating more resources and time to enhancing these products, teams can drive innovation, respond to market trends more effectively, and deliver enhanced value to customers. This shift also cultivates a culture of agility and adaptability, enabling organizations to stay ahead in rapidly evolving markets.
Leveraging the Number of Tickets on Old Products
Another essential metric for evaluating the success of the product-first approach is the number of tickets associated with legacy products. Fewer tickets indicate a reduced need for support and maintenance on older offerings. By effectively addressing and resolving customer issues, organizations can minimize the number of tickets generated, freeing up valuable resources. This reduction allows teams to focus their energy on product innovation, accelerating development cycles, and improving time-to-market. Ultimately, it paves the way for more efficient and streamlined operations, resulting in greater customer satisfaction and improved overall product performance.
Regular monitoring of these metrics is essential to evaluate the long-term impact of the product-first approach, identify areas for improvement, and adapt strategies accordingly.
Product Abandonment
In addition to tracking developer time and tickets, another crucial factor to consider when evaluating the success of a product-first approach is the customer base using old non-strategic products. The number of customers relying on outdated offerings can significantly impact resource allocation and priorities. If a substantial portion of customers still utilizes legacy products, the need for support, bug fixing, and maintenance will persist. In such cases, it becomes essential to dedicate the necessary time and resources to ensure customer satisfaction and minimize disruptions.
Conversely, as the customer base transitions towards adopting the newer products within the portfolio, organizations can allocate more time and attention to strategic products. With a reduced reliance on outdated solutions, development teams can channel their efforts into enhancing the functionality, usability, and competitive advantage of the newer offerings. This shift enables organizations to capitalize on market trends, drive innovation, and deliver greater value to their customers.
By carefully monitoring the customer base and understanding the adoption rates of newer products, organizations can make informed decisions about resource allocation, development priorities, and support strategies. This customer-centric approach ensures that efforts align with market demand, maximizing the potential for success in the product-first journey.
In summary, the composition of the customer base and the adoption rates of products play a pivotal role in determining the allocation of resources and time. A higher number of customers using outdated non-strategic products may necessitate increased support and bug fixing efforts, while a growing base of customers embracing newer offerings empowers organizations to focus on the strategic products that drive innovation and differentiation in the market. Balancing these factors is vital for effectively implementing a product-first approach and achieving sustained success.
Release Age Metrics in Product Management
In addition to the metrics mentioned earlier, another valuable metric to consider when evaluating the success of a product-first approach is the age of releases in production. The age of a release refers to the time elapsed since its deployment to customers. This metric provides insights into how effectively organizations are encouraging their customers to adopt new releases and stay up to date with the latest product enhancements.
When customers tend to use older releases for extended periods, it can result in increased support and bug fixing efforts. Timely resolutions for issues and customer requests become necessary to ensure customer satisfaction and minimize any potential disruptions caused by outdated versions. This situation can strain development resources and hinder progress towards a product-first mindset.
Conversely, if product management can successfully persuade customers to update frequently and adopt new releases promptly, it can yield significant benefits. By encouraging customers to stay current, organizations can save valuable time and resources that would have otherwise been spent on supporting and maintaining multiple outdated versions. Additionally, frequent updates enable organizations to deliver new features, improvements, and bug fixes more efficiently, providing enhanced value and addressing customer needs more effectively.
Relating these metrics to the well-known DORA (DevOps Research and Assessment) metrics, which focus on key performance indicators for high-performing software delivery teams, there are notable connections. The DORA metrics, such as deployment frequency, lead time, change failure rate, and mean time to recovery, align with the goals of a product-first approach. By promoting frequent updates and reducing the age of releases, organizations can improve their deployment frequency, reduce lead time, and lower the change failure rate. Additionally, faster recovery times from incidents or issues in newer releases can be achieved through improved monitoring and bug fixing processes.
In the context of product management, these metrics help measure success by assessing the organization’s ability to deliver value, respond to customer needs, and maintain a rapid feedback loop. By tracking the age of releases and analysing its impact on support, bug fixing, and customer satisfaction, organizations can identify areas for improvement, establish targets for timely updates, and measure progress towards achieving a product-first approach. These metrics serve as a valuable tool for product managers to drive continuous improvement, optimize resource allocation, and align development efforts with customer demands.
The age of releases in production is a significant metric that reflects the effectiveness of product management in encouraging customers to adopt new versions promptly. By reducing the reliance on outdated releases, organizations can save time and resources while delivering value through frequent updates. These metrics, when aligned with the DORA metrics, contribute to measuring success in product management by evaluating the organization’s ability to drive innovation, agility, and customer satisfaction through a product-first approach.
Milestones
Using milestones in the form of thresholds can be highly beneficial when evaluating the success of the product-first approach. These milestones serve as specific targets or goals that provide a clear direction for progress and enable product managers to track the effectiveness of their strategies.
By setting thresholds for metrics such as Developer Time, Number of Tickets, Customer Adoption (%), and Deployment Frequency, organizations establish actionable milestones to measure their performance against. These thresholds can be based on industry benchmarks, internal goals, or historical data. They act as guiding points, helping product managers gauge progress and make informed decisions regarding resource allocation and strategy adjustments.
The inclusion of milestones in the comparison table brings several advantages. Firstly, they provide a tangible way to assess progress and success. By comparing the actual metric values against the predefined thresholds, organizations can easily determine whether they are on track or if adjustments are necessary.
Secondly, milestones offer a sense of direction and motivation. They provide clear targets for teams to work towards, fostering a shared understanding of the desired outcomes and creating a sense of purpose. As each milestone is achieved, it becomes a cause for celebration and reinforces the product-first mindset within the organization.
Furthermore, milestones enhance communication and alignment. By having predefined thresholds, product managers can effectively communicate expectations and progress to stakeholders, such as executives, development teams, and customers. It facilitates transparency and ensures that everyone is working towards the same goals.
Lastly, milestones enable the identification of areas for improvement. If a metric falls below the threshold, it serves as an early warning sign, indicating the need for corrective actions. Conversely, surpassing a milestone can signal success and provide valuable insights into the effectiveness of the strategies employed.
By diligently monitoring and analysing these metrics, product managers can assess the effectiveness of their product-first approach and make data-driven decisions. Successfully implementing a product-first strategy results in optimized resource allocation, improved customer satisfaction, and a competitive advantage in rapidly evolving markets. Embracing these metrics as indicators of success empowers organizations to continuously improve their product management practices, innovate proactively, and deliver exceptional products that meet and exceed customer expectations.
