Ravi Akella

Roadmapping and the challenge of predicting the future in an Agile world

“The future depends on what you do today.” ― Mahatma Gandhi

4803587118_0ba543352e_o — Creative Commons, source: https://www.flickr.com/photos/40875081@N06/

Presented below is the model I’ve landed upon after a decade of Product Management. When I reflect, I realize why Product Management is such a challenging and rewarding role – our job is to mitigate any risks that hamper future growth and demand for our products and, of course, predicting the future is impossible – great career choice, Ravi! 😊 The question that has constantly nagged me for ten years is, “Will someone care enough about what we’re building to pay us for it?”.

So here goes, hopefully some of this structure improves our (yours and mine) odds at anticipating the future (since we can’t predict it). A lot of this is nothing new in concept, so please excuse the verbosity below, but it can be hard to implement given all the crises and distractions that rock a Product Manager’s day-to-day life.

At the highest level, I believe there are some practices that need to be followed consistently for the product plans to be meaningful – the actual roadmap can and should change quite a lot over time as one tests their hypotheses with real customers through an Agile process.

First, it is key to define the customer (the paying entity) segment in terms of industry, geography, company size etc. etc. and think about the current size and future opportunity – this is not easy if we look at it from the “who uses our product today?” perspective – everyone ends up with customers they didn’t think they would get. For example, I inherited a team that ran Product Management for a widely used, highly scaled product used in every conceivable industry by companies of all sizes. Given the mind-boggling range of target markets, we deliberately started focusing on a specific industry not because of our past success but because we saw the potential room for growth in that industry according to market research. Other industries were important but did not offer as much opportunity for growth so the roadmap started heavily biasing towards solving the problems in this target industry. So, the moral of the story is that you have to make choices on who your customer is and focus your research and your development efforts… very rarely can you avoid making this choice so, get on it!

We need to then explicitly document and discuss the current tools, workflows and processes in our target industry and identify the users (people who touch the technology) in that workflow who we want to serve – in my experience this is best done as a collaboration between data analysts, user researchers, experience designers and PMs analyzing data and visiting or talking to customers to document their workflows (if you’re in a small company, the PM does it alone). Know that there could be multiple user types that benefit from our tools and they need to be explicitly called out. Of the user types, we need to explicitly define which users would be key to driving adoption and prioritize their problems first… for example, capturing user type A might create an ally inside the customer’s organization to drive adoption with user types B and C. Also, it is important to map out the dependencies between these users… sometimes the only way to deliver value is to solve a problem in a way that serves multiple users at the same time.

We need to then be explicit about the problems faced by our target user type in the target customer type (industry, geo, etc. etc.) – every need and feature request must be reworded in terms of the underlying problem. We should not jump to solutions (as tempting as it is) because everyone (from executives to PMs to development to Sales) needs to be clear on the user type, customer type and the problems we’re trying to solve. If there is a debate (which there will be) it should be about the importance of the problems we want to solve not a particular solution we want to implement – this is because every problem can have multiple solutions (some of which are not development tasks – better training, better customer support, better documentation, the PM’s personal cellphone number for every customer 😊 etc. etc.).

We also need to be explicit about prioritizing the problems, think in terms of two variables to score the problems for prioritization – pervasiveness and severity (higher the better). It is key to think about the pervasiveness and severity in the context of the target user and target customer/industry.

Once there is some common understanding of the prioritized industry, prioritized user type and the prioritized problems then the fun part of imagining the solutions, the new workflows begins. This is a cross-functional job and should include PMs, Technical Architects, Development, Experience Design, Analytics. The solutions can be scored for priority based on the following variables…

Differentiation – How different/better is it compared to the competition or the status quo? The PMs need to know the competitive landscape or current alternatives for this one (higher the better)
Cost – What is the R&D effort in terms of time and people? The Development Managers need to provide rough estimates (lower the better)
Risk – How certain are we that we know how to solve the problem? Sometimes there is need for pure invention so the risk is high. The development and software architects need to weigh in (lower the better)
Barriers to adoption (the silent killer of best laid plans) – How easy will it be for the target users, in the target industry, to adopt this solution? This is where experience design and user research can really provide some insights. (lower the better)

One can create a cumulative formula from the scoring described above to create a prioritized über list of solution proposals.

The final roadmap or backlog then is a list of prioritized solutions derived from the list of prioritized problems derived from a list of prioritized users derived from a list of prioritized customer types. Ideally, the prioritized customer types list changes least frequently and the prioritized solutions list changes most frequently as hypotheses are continuously tested through an Agile process.

This kind of list also makes it easy to evaluate the value and adjacency of potential acquisitions because, ideally, you’re looking to solve a broader range of problems for the same/similar customer type (since you may have already expended the energy and the cost of acquiring said customer and/or your go-to-market partners like marketing and sales are experienced at targeting and acquiring these customers).

One last thing is to maintain a list of mandates – these could be things like infrastructure updates, critical customer reported bugs, other unavoidable initiatives etc. that are non-negotiables. We all know they happen and its best to keep bandwidth free and have an open mind when they come and translate the mandates into their underlying problem statements.

I hope all of this helps… I have learned that having a structured way of thinking reduces stress, improves decision-making and brings sanity to a role that can feel like constant fire-fighting. The scoring/prioritization described above is still dependent on the PM’s judgement but breaking the process down to focus on customers, users, problems and then solutions clarifies the PM’s thought process and provides justification to get stakeholders and peers on board for execution.

If there are things here that don’t make sense to you then please write me a comment. I am a student of the art and craft of Product Management and I would love to learn from all your experience.

It’s the last mile that counts – Amazon Locker

A few weekends ago, I was catching up on the news and read about the thousands of runners finishing the last mile of the Boston Marathon. Running the last mile was a symbol of respect for the victims of the tragedy in April and the resilient spirit of a city and nation. As I was reading through the runners’ quotes in the story, I reflected on the importance of persevering and running all the way to the finish in my life and in my work.

I have always thought (and mentioned in a previous post) that the creation of great products is more akin to running a marathon than a series of sprints (no pun intended). Truly successful products and services go the distance and make sure that the promised value is actually delivered and realized by the end user. It is this focus that turns a product (technology + ideas + promises) into a solution (tangible value that customers would pay for).

As a product manager living in the San Francisco Bay Area, I have the privilege of meeting a lot of product people and discussing product strategies and challenges. Almost always I see a crisp definition of the problem that needs to be solved and a detailed description of the virtues of the product. However, more often that not, it becomes apparent that the product as-delivered does not really solve the problem unless the customer has specific abilities or skills, which may be difficult to possess or acquire. At this point the conversations get interesting and the big a-has come from working out how to turn capable products into a tangible solutions – charting out that last mile.

So when I stopped to reflect about an example that showed a clear understanding of the importance of running to the finish line, I landed on my recent experience with Amazon Locker. It takes the e-commerce experience literally to the last mile and makes sure that customers receive their purchases without having to worry about someone stealing the package or having to wait around for the UPS guy. Since I live in a condo building in an urban downtown, my deliveries sometimes have a tendency to find legs and disappear. Amazon Locker comes to the rescue; it’s a secure, single-use post office box at a convenient location (half a block from my building) to pick up packages… brilliant! Amazon’s obsession with operations is well known so I am not surprised that they thought about their ‘product’ as being all the pieces that need to come together for the customer to realize the value (quick, secure delivery of the package) of an online purchase.

There’s no doubt that creating amazing products requires an obsessive attention to detail. And, it seems like the most important of these details is the series of events that need to happen for customer to actually realize the promised value of the product… and the probability of these events happening in the real world. A good reminder that at the end of the day, it’s all about customer outcomes not products, and the persistence to make those outcomes happen – here’s to running that last mile.

Doing boring things well makes room for innovation

On a recent sleepless night when my daughter was struggling with a high fever, I found myself silently willing her immune system to kick the nasty virus’ behind. And that’s when it occurred to me, that while she gets compliments for her intelligence and her bubbly personality, no one ever compliments her on her immune system. Even though a properly functioning immune system is a prerequisite for her to learn new skills and to maintain her happy, light-up-the-room demeanor.

The next morning (in my half-woken daze) my neurons started connecting my thoughts about my daughter’s immune system with thoughts about product management and innovation. I kept thinking about whether I, and product managers in general, worry enough about their organization’s hidden systems. Do we think about the systems that might be ‘boring’ when described on a PowerPoint slide but are critical to support risk-taking and learning i.e. innovation?

I should clarify a few things at this point, I do not believe that well-oiled systems and processes can, by themselves, ensure the long-term success of a product or company. We all know that existing paradigms can shift dramatically and an optimized, efficiently running system can become irrelevant almost overnight. Also, I want to re-emphasize my belief that product management is about the what and the why and not the how – I just want to posit that the what and the why of systems that are critical to the survival, evolution and success of the product are (or should be) the concern of product management.

When I went looking for some examples of companies that do the ‘boring’ things really, really well, I found a couple of familiar names.

Apple and its supply chain:
I’m pretty sure that inventory stats won’t ever make the cut for any of the slides at an Apple keynote address, but my hunch is that Apple’s ability to run the tightest manufacturing supply chain in the world makes a lot of the innovations on the eye-catching slides possible. According to a recent report from Gartner, Apple is still #1 at masterfully orchestrating it’s entire supply chain and ensuring that its products are never sitting around gathering dust. In reality, Apple products generate so much demand that their main problem is assembling and shipping products at breakneck speed (hopefully in humane conditions). However, if the unthinkable were to happen and one of their products fails to create demand, the company won’t need to bleed money and take write downs like some of its struggling competitors. This must give them the ability to recover quickly from missteps and keep innovating.

Facebook and its uptime obsession:
Admittedly, uptime alone never made someone’s web-based business a success – sometimes stating the obvious is necessary. However, it is almost criminal to waste away one’s hard fought product-market fit because of sloppy reliability. It’s now historical fact that Facebook’s leadership has had an uptime obsession since the very early days. Their expansion, which seems almost instantaneous in hindsight, was measured and underwritten by an ability to ensure reliable uptime for all the new and existing users. On the other hand, the fates of services that came before Facebook but did not pay much attention to mundane details like reliability were sealed pretty quickly. Facebook seemed to have understood early that earning trust comes before earning money – the important thing is to remember that at all times.

A distressingly large number of products fail in the marketplace – some businesses are able to learn from such failure and succeed while others disappear. My belief is that the businesses that prevail understand that innovation is 99% execution and that the resilience that powers risk-taking and creativity comes from focusing on the mundane yet critical details.

Dyson – It sucks, but that’s the point

My wife and I invited nine friends over for Thanksgiving one year and it became quickly apparent that folks would be sitting all over our living room, including on the carpet. It was time for my trusty Dyson to shine – yup… buy, use, love indeed.

Depending on who you want to believe, the first vacuum cleaner was invented in the 1860s and by the early 1990s, a few large players competed mostly on bell and whistles (think colors, attachments and weight) in a global, consolidated market.

Hardly, a situation that would invite to an enthusiastic inventor to redefine the rules. But that’s exactly what James Dyson did. By 2004 Dyson took over the market leader position in the United States from once mighty Hoover.

So curious as ever, I decided to add Dyson to my buy, use, love list because I wanted to understand how the gargantuan incumbents in a stable, non-sexy market were humbled by an innovative upstart which priced its product at twice the market norms. Here’s what I learnt…

Focus on the obvious problem: James Dyson says it pretty bluntly in this TV ad, “Solve the obvious problem that others seem to ignore.” Large incumbents in stable markets tend to assume that some obvious problems (like the loss of suction) can never be solved. This leaves a gold mine waiting for someone foolish or wise enough to attempt solving that very problem. I’m sure all good Product Managers focus on what they perceive to be their customer’s most pressing problems. However, it never hurts to occasionally question our assumptions to see if we’re ignoring an obvious problem in the name of conventional wisdom.
Plan for failure and learn from it: In his autobiography, James Dyson talks about the 5126 failed prototypes he built before he had a design that finally worked. His enthusiasm for failure comes not from the failure itself but from the learning that comes from it. As Product Managers, I’m sure we can all recount some instance when a product croaked on arrival (and the subsequent scrambling and heartburn). Understanding that failure is a necessary step to a breakthrough and planning for it through early, inexpensive prototyping is essential to product magic.
Invest in what’s next: Dyson kept investing in research and development through the downturn even while other companies reduced R&D expenditure. By staying committed to spending on what’s next, Dyson makes certain that their next growth curve kicks into high gear when their current businesses start plateauing. As Product Managers, it’s easy to get consumed by the everyday tasks to get the current product out of the door. However, investing the time and mental cycles to research what’s next (leaving the office and getting in front of customers) pays back in spades.

I have personally waxed poetic about my Dyson to friends and family and all the while, I never stopped to wonder what it is that compelled me to do so. It took writing this post to realize that their stubborn commitment to transforming products from mundane to amazing has a lot of lessons for Product Management geeks like me; I hope I’m not alone.

Escape the ‘How’ prison with ‘What and why’

The motivation to write this post came from a great, raw, uncut interview with Steve Jobs, the then CEO of NeXT Computer, in 1990. Among many other insights, he recalls a thought that crossed his mind when he gave Sean Lennon a Macintosh as a birthday present, “Older people want to know how it does what it does but the young people just want to know what it can do”.

There comes a time in every product and industry’s history when serving the expert customer imprisons the product team into a cycle of ‘how’. The Product Managers respectfully ask folks ‘how’ something should work, implement things to comply with what they heard and then spend their days explaining ‘how’ things work in order to convince the expert to buy the new and improved product.

Of course, the inherent problem with this scenario is that in any sizable community, one will get a different answer to the ‘how’ question from every single expert user. So the final implementation and explanation of ‘how’ the product/feature works will be a compromise that satisfies noone completely and disappoints everyone slightly. The hope then is that one is able to manage the compromises effectively enough for the majority to still buy the product. In essence, one becomes a Compromise Manager instead of a Product Manager. A quick clarification at this point – obviously all complex projects require smart trade-offs to ensure maximum value is delivered with the time and resources at hand. The compromises that I write about here are about finding the least common denominator among many different implementation options, ending up with an insipid experience for all.

Now consider the scenario where the Product Manager reaches out to not only the current user but also the new user and the potential users and asks them what they would like to do and why (think outcomes and results not product features). In this scenario, there is freedom – freedom to implement the solution however one sees fit while making sure that the users can do what they want to do painlessly. Of course, the implementation in this case takes a lot of hard thinking as well as hard work because the Product Managers have to chart their own course. However, at the end of the day, they can then sell the product by talking about what all it can do and not ‘how’ it does it.

If these are the primary options, then why is it that Product Managers and product organizations choose the route of ‘how’ – why is it that so many wantonly imprison themselves in these user-generated courses of action that are guaranteed to produce unsavory compromises and ho-hum results?

You tell me…

P.S. – Steve Jobs… RIP, your biggest gift to the tech community is your way of thinking and yes, your products, they’re awesome too.

Product Management lessons from my newborn

It’s been a while since I blogged but I’ve been keeping busy since my last post… officially moved to the Bay Area, settled into the new job and, on August 30th, became a proud father of a healthy, beautiful baby girl. As a first-time parent, I realize that there is an infinite amount of learning ahead of me – this is merely the beginning. However, as I was spending yet another sleep-deprived night trying to decipher my daughter’s cues I saw some great product management lessons staring me in the face… literally. I’m finding lessons from my newborn and Mother Nature about how to launch a new product or business, nurture it and see it grow.

As a species, we’ve had the time to perform billions of iterations to come up with just the right handful of skills a human newborn needs to survive and thrive. It feels like there is a profound lesson here to guide those of us who struggle with new beginnings in other realms – like products and businesses. Mother Nature isn’t shooting for a ‘full-featured’ person at birth but it is very clearly setting the newborn up for success – with innate attributes and abilities (however few) to advantageously use its environment.

I just have a strong hunch that if most mere-mortal Product Managers were writing a Product Requirements Document for a human being… it would detail out the abilities of a well-adjusted, able-bodied 21-year old and explain why most of those skills are essential. That’s why I want to get this post out while all of these thoughts are fresh in my mind so I can look back at it someday when I am confronted with planning and launching something brand new.

Be irresistible
Babies are designed to be ‘cute’ – with their big eyes, large foreheads and chubby cheeks they tap into deep evolutionary programming in the adult mind and compel grown-ups to care for them and protect them. In fact there is ample research that points to the fact that all functioning adults (especially new parents) tend to be attracted to a baby’s cuteness – talk about precise target marketing. Babies may not be able to impress with insightful speeches, physical feats or sharp wit but they can and do mesmerize their own parents and caregivers. The lesson here is that, in the early days, being irresistible to the target demographic is more important than being ‘full-featured’ (quick side rant – as with people, products and businesses have to constantly learn and grow so there is no such thing as a full list of features on day one). Find the target customers of your product and business and understand them well enough to build something basic but truly irresistible – nothing else will do. This means minimizing the features to a point of discomfort and maximizing the beauty and elegance of the user experience to a point of obsession.

Fixate on the early adopters
The apparently underdeveloped senses of a baby are in fact highly tuned to identify and bond with their parents and primary caregivers. At a very early stage, babies make strong associations with the smells and sounds of their parents/caregivers and use this information to create strong loving bonds. There is scientific evidence that every time an infant feeds it reinforces the olfactory association to Mom in its brain. Even though babies are handed a set of underdeveloped senses, their focus on identifying and bonding with those who sustain them is pretty awe-inspiring and instructional. Early-stage products or businesses need just as much TLC as a newborn infant in order to survive, so it’s essential to fixate on the early adopters who will provide support and sustenance. There will always be critics who will seek to diminish your brand-new product by making comparisons to mature alternatives but, in the early days, you must ignore them. Once you have a relationship in place, the early adopters will help you grow stronger and become more capable.

Have an open mind and learn
Babies aren’t born with a lot of experiences to draw from but they are wired to learn – every waking minute they are soaking up information about their new surroundings, their parents and their own bodies. As a new parent, I am constantly doing things (some of them rather silly) to feed this insatiable desire for learning. It seems like Mother Nature is urging us product people to build products and organizations that are designed to learn from the get-go. Since all product groups and businesses operate with precious few resources, why waste them on building a few more premeditated features that may or may not resonate – why not spend the effort to instrument your product to be aware of when, where and how it’s being used and by whom? You can then use the data to spur deeper conversations with your users, understand why it’s being used the way it is and grow the product to make it more relevant, easier to use and more delightful.

Without a doubt, parenting is the most joyful and the most challenging thing I will ever do but I’m glad that this process is teaching me as much as it’s teaching my baby daughter. I am convinced that I can couple my insights as a parent with my renewed caffeine dependence to become a better Product Manager – I have a feeling that there are more posts like this in my future.

When and why is ease of use important?

This post is spurred by a few thoughts that have recently crossed my mind. One, it’s been an eternity since I’ve posted and the ideas for posts are now stacking up, withering and dying off… it’s time for some action. Second, I’ve recently moved from a quiet suburb of Portland, Oregon to San Francisco… life is not as easy(logistically) as it used to be but the energy of this big, busy, noisy city is exhilarating. And third, as part of this move we got rid of one of our cars and kept the Subaru (which I have mentioned in a previous post)… the Subie has a manual transmission and despite the traffic and the hills in our new town, we are happy it’s the car we kept.

How does any of this relate to a blog that’s apparently about Product Management? Well, these thoughts got me thinking about the value people place on ease of use – more pointedly, I am wondering if ease of use is the highest virtue to seek in products and services – in life?

Let me make it clear at the outset that as a Product Manager who admires products that people buy, use and love, I am not advocating for making things hard to use. No, no, no – I am merely wondering about the questions that need to be asked to understand if (when) ease of use is deemed valuable by customers and markets. I’ve writing about the questions that came to me but I’d love to hear your opinions…

Who is the target customer/user?
Early adopters (all Product Managers have met a few) love new products and services; they love figuring things out when they are difficult and duct-taped together. This makes them feel a sense of pride and they may gain credibility in their community for tackling a new product first. These users demand greater control so they can configure, customize and morph the product or service into sheer coolness. Of course, the more this demand for control is satisfied by the product creators (think massive options dialogs or unending variations on coffee drinks) the harder and more intimidating adoption becomes for the novice. I realize that it’s extremely challenging to peel away from the early advocates but, just like indie bands do every day, sometimes it makes good business sense to appeal to the masses. If the masses are the target customer, focus on ease of use – to these users easy is cool.

In what context is the product being used?

I recently read a great article that urges product creators (designers and managers) to empathize instead of trying to quantify ease of use (clarity) and value (usefulness). Empathy comes from identifying and understanding the scenarios of use and then building the product or service to fit these scenarios. Consider for example how quick service and cheap prices are more important at lunchtime on a workday and possibly a negative when you are trying to impress someone on a dinner date on the weekend. Understanding the real use cases makes it very clear that sometimes being easy isn’t the most pressing need.

What are the alternatives to your product?

In the early days of a product category, there might not be an alternative for a product or service. Soon enough, competitors will emerge and start outdoing each other with features/functionality and be rewarded by customers (the incremental value of each new feature is still high). It is truly a time when you build it and they come. Of course, at some point the various offerings become virtually indistinguishable. Then the easiest way to compete becomes price and we all know where price competition takes the market – the eroded margins make it impossible to fund innovation and slowly the most eager price droppers start hemorrhaging into obscurity. This is precisely the time to focus on the customer experience and ease of use. In a landscape of indistinguishable alternatives, how good a customer feels (or how little they are annoyed) becomes critical.

Just to be clear, ease of use is always a good thing but product management is about making tough trade-offs. And as we debate these trade offs, it seems helpful to keep in mind that products, like people, grow and the priorities one sets will need to change with that growth. For now, here’s to noisy cities and manual transmissions – check back with me in a couple of years.

Netflix – Flicks directly on the net… at last

Lately, I’ve been running errands to tie up the loose ends of a construction project at home and I keep driving past the now defunct ‘Hollywood Video’ store in my neighborhood. As you might expect, the Product Manager in me looks at this abandoned store and can’t help thinking about the innovation and creative destruction delivered to my neighborhood by… you guessed it… Netflix.

I have to admit that, over the years, I was only a sporadic member of the videos-by-mail, no-late-fees Netflix service. That’s because I was always able to find time to watch movies in the theater and so waiting for movies to release on video and be shipped to my house didn’t make much sense. However, all that changed recently when I discovered the instant gratification of Netflix’s video streaming service.

Of course, like the rest of Netflix’s instant-streaming customers, I would like the catalog of content to grow by leaps and bounds. The growing rate of adoption of the streaming service is a great win and a great challenge for Netflix – it’s now up to them to turn these buyers and users into vociferous lovers of their service. In the meantime, there is enough geeky PBS and National Geographic content on their catalog to keep me satisfied for weeks, if not months.

I recognize that it might be a little too soon to add Netflix’s streaming service to the annals of buy, use, love greatness but my study of their strategy might interest fellow Product Managers because it reveals the makings of a blockbuster – no pun intended. Here’s what I learned…

If the data contradicts your business model, reconsider the business model –

Over the past few years, Netflix noticed the downward trend in the number of DVD shipments per user and an increase in the amount of streaming content. This unadulterated market data has driven the company’s transition to streaming from the DVD-by-mail business model that built its initial success. As with any transition, there will be challenges – lower monthly subscription fees, higher content licensing fees, heavyweight competitors etc. but Netflix is clearly committing to the future instead of rabidly defending the past. As Product Managers, we’re often confronted with a choice – tweak the parameters of a known model or explore the uncertainties of new ones. To help with this choice, let’s commit to seeking as much true market data as possible. In the absence of data, self preservation drives PMs and companies towards the tried and true instead of risking the path of tomorrow’s breakthrough.

Focus on eliminating the pain of change –

The triumph of the internet as a means of serving entertainment content seems like a foregone conclusion to folks like me, but it represents a significant transition away from traditional TV for a large majority of Americans (even those with access to high speed internet). Netflix (and the competition) is working feverishly to reduce the pain of this change by offering it’s streaming service on a wide range devices that are already plugged into their customers’ TV screens. Like all good Product Managers, the folks at Netflix know that introducing an innovation that is dependent on a change in customer behavior requires a keen understanding of current behaviors. There are no guarantees of success, but fitting seamlessly into the current ecosystem and eliminating the switching costs will definitely help the odds.

Customer satisfaction is your best defense – Netflix has been astute about intimately understanding customers’ interactions with the service to drive greater satisfaction. In fact, they even spent a million dollars to crowdsource a better recommendation engine to improve the customer experience. This focus on customer satisfaction will serve Netflix well, especially as their power as a content clearinghouse spurs competitive reactions from content creators. Netflix’s strongest defense will remain it’s ability to offer a service that customers prefer. Competitive pressures are a constant for companies and Product Managers and it’s critical to remember that customer satisfaction (more so than feature wins, pricing or promotions) is ultimately the strongest defense.

Netflix is charting a bold course to redefine not only it’s own business but also the larger entertainment industry. I cannot predict today if Netflix will emerge on top but I can tell that it won’t be for the lack of a sound strategy.

Subaru – Love on four wheels

At the outset, I should admit that I live in the Pacific Northwest and that may be one of the reasons I’m taken by this buy, use, love story. I love our Subaru (technically it’s my wife’s car so I don’t use it as much as I’d like to). When we bought it, it was the lightest, most fuel efficient (for an AWD), tightest-turning little SUV we could find. Even though all cars eventually lose their new smell and sheen, we keep recommending the Subaru to our friends and family.

There is no doubt that Subarus shine in parts of the country that have harsh winters or tons of outdoor enthusiasts. Lately, however, it seems like its core group of self-appointed brand advocates have slowly started turning the rest of the country on to Subaru vehicles. In 2009, the year we bought ours, Subaru saw remarkable success while the rest of the industry was being bailed out or bought up. In fact, they’ve kept up the blistering pace of growth throughout the Great Recession.

All car companies have hits and misses and Subaru is no exception; it is also much smaller than some other companies so growth rates alone might not be the correct measure of its success. What is clear, however, is the loyalty of Subaru owners… everyone we know who owns one, loves their Subaru. As you might expect, the Product Manager in me was compelled to investigate the strategies that fuel this (sometimes unhealthy) devotion.

Create a unique identity and stay true to it
Subarus are quirky, all the way from their exterior design and mechanical underpinnings to the way they are produced and marketed. This quirkiness, which aligns the company’s values with those of its customers, makes Subaru’s story and value proposition authentic and sticky. The ubiquitous all-wheel-drive (safety), the smooth, fuel sipping boxer engines (fuel efficiency) and the industry-leading zero-landfill auto plant (eco-consciousness) all make the company’s identity inseparable from the values held dearly by its customers. As a Product Manager, it seems obvious that one would build a marketable value proposition around the customers’ deeply held values (not just near-term needs and desires) but Subaru’s example highlights how uncommon it is to create and maintain this commitment to authenticity.

Focus on customer experience and outcomes
According to their CMO, Subaru recognizes that its core customers (I’m paraphrasing) are the types of people who buy experiences instead of things. These are well-heeled, educated and financially savvy customers who buy Subarus to fulfill their desire to beat the elements, burn rubber (in the case of the WRX drivers) or explore the wild outdoors. Consequently, Subaru’s product strategy focuses on enabling these experiences instead of outdoing their competition with muscle, chrome and technology. All good Product Managers realize that customers care more about dead (or trapped) mice than a better mousetrap… it’s essential to focus on the experience and the outcome not just the product.

Turn sales into relationships
The key reason for its recession-proof financial performance is Subaru’s ability to inspire devoted loyalty and return business amongst its customers. Even though typical Subaru customers are frugal enough to keep their cars for a long time, they keep coming back to buy more Subarus (apparently on average every 7.3 years). The company invests heavily in these relationships by making product improvements to address customer feedback and training dealership personnel to excel at everyday service. They’ve even started a program to let customers adorn their cars with badges to profess their love (free marketing, anyone?). Even with the possibility of occasional harsh criticism, creating a true relationship and dialog with customers is the most valuable and gratifying investment a company and a Product Manager can make.

As I read this post, I keep wondering if I’m describing a company’s product strategy or the secrets to individual success. Creating an authentic identity, focusing on positive outcomes and building rich relationships can definitely make us the best versions of ourselves; as it turns out, these principles also help make the best products.

Harley Davidson – Born to be HOG wild

I can’t think of any other brand that generates as much buy, use, love passion as Harley Davidson. In a time when ‘American manufacturing’ is becoming an oxymoron, Harley Davidson is proudly carrying the banner of American innovation, industry and irreverence. Regardless of all the well-heeled Harley owners who just tootle around on weekends, Harley Davidson represents the irrepressible American spirit of legend that has captured the world’s imagination.

Over the years, Harley Davidson bikes have been vilified, glorified and caricatured in American popular culture but the sheer resilience of their iconic image is the envy of corporate America. Since opening it’s doors in 1903, the company has seen many highs and lows and even some near-death experiences. The juxtaposition of this chequered past and the utter devotion of its customers intrigues me.

Some would credit Harley Davidson’s survival and success to the collective nostalgia among American bikers or the protectionist tariffs on imported motorcycles in the 80s. However, I was convinced that some counter-intuitive product strategy must have played a part in reviving this American icon. Inquisitive as ever, I went looking and here’s what my sleuthing uncovered…

Don’t play your competitor’s game
When Harley Davidson was emerging from near bankruptcy in the early 80s they made a clear decision to ignore the competition and chart their own course to success. At the time, there was no doubt that Japanese manufacturers held the advantage in the mainstream market so Harley decided to focus solely on heavier premium motorcycles and retro designs. In fact, during the latest economic downturn, Harley Davidson decided to forgo market share to maintain their premium status while their competition was lowering prices and offering aggressive incentives. Product Managers are often under pressure to beat competitors and take market share by out-executing on the same tactics as everyone else. Harley Davidson’s example shows that success may not lie in beating competitors at their own game. Let’s all take the time to proactively define success instead of reacting to someone else’s.

It’s OK to be conspicuous
Early in my career, I worked for a company that helped Harley Davidson engineer new models that produced a perfect rendition of the legendary Harley growl. Much like the first iPod’s white headphones or the Toyota Prius’ odd shape, Harleys are designed to stand apart from every other player in the market (even though the competition is constantly trying to catch up). For better or for worse, Harleys grab everybody’s attention and fuel the aspirations of future riders. Of course, not all Product Managers get to manage aspirational consumer products but it always pays to design in ways to amplify your product’s differentiators. If your product is truly better than the competition then don’t be shy… be conspicuous. The good thing is, you’ll hear from the market very quickly if you’re all swagger and no spine.

Enable customers to innovate and learn from them
From the early days, Harley Davidson enthusiasts have refashioned their stock motorcycles to reflect their very own personal style. The company has supported and stayed close to these outside innovations and adopted some of the ideas to create new lines of products. All good Product Managers recognize that innovation can come from anywhere but only a few build platforms that enable innovation outside their own company. Whether it’s building choppers around your ‘Big Twin’ engine or services on top of your API, enabling customers and partners to innovate could be the best R&D investment your company ever makes.

As I was writing this post, the reasons behind the Harley loyalist’s passion became crystal clear to me. The Harley Davidson spirit of individuality and rebellion is more than just slick marketing; the motorcycle itself embodies the spirit. Here’s hoping we can all create products that are physical manifestations of our ideals.