The "Rules" for exceptional products
Talkin' in my sleep at night, makin' myself crazy
(Out of my mind, out of my mind)
Wrote it down and read it out, hopin' it would save me
(Too many times, too many times)
These lyrics from Dua Lipa inspired the following postEveryone loves a good story about products that capture customers' hearts and wallets. But how do some companies and teams manage to achieve this time and again, while others just can't seem to hit the mark? Having been lucky enough to work with a few of these exceptional teams, I believe their success lies in a handful of principles and cultural practices when it comes to making product investment decisions.
You wanna create products that stand out, But sometimes, it feels like you're lost in a crowd. (Out of my mind, out of my mind) Well, I've got some rules that'll help you shine, Just follow along, and you'll do just fine. (Too many times, too many times)
The #1 Rule - Ditch the desk and know your customers on a deeper and personal level.
Can “everyone” on the team describe the customer?
Take an example where you're building products for small businesses. What type of small business? Is it a restaurant, a retail store, or something else? Who's running the show, and what are their names, hobbies, and backgrounds? What are their priorities and daily routines? What are their wildest hopes and dreams, and what keeps them up at night? And don't forget, how do they make business and financial decisions, and what factors do they consider?
Get up close and personal with your customers, and you'll develop products that truly resonate with them. But if your team can't answer these questions with gusto, you're headed for trouble.
The #2 Rule - Lifeboat exercise: It's not about doing more, but about doing the right things well.
When building products or making strategic decisions, it's crucial to start with your goals and metrics, and determine what long-term success looks like for you. This means defining the impact you want to have and developing a roadmap to help you achieve it. Remember, your product roadmap should always be driven by your goals and key results, not the other way around. Don't just measure what you're already planning to build. Your OKRs aren't a scorecard for the roadmap; they're a way to ensure you're making progress towards your overall objectives.
Try playing the "lifeboat exercise" with your product features. Ask yourself, "If I only had room for one feature on my lifeboat, what would it be?" This approach can help you prioritize the features that will have the biggest impact. Don't be afraid to draw a hard line and be aggressive when deciding which features to pursue. Keep iterating until you feel confident that you've made the right choices. By taking this approach, you'll be able to move quickly and efficiently on the features you've committed to, resulting in high-quality products that truly move the needle for your business.
For example, if your goal is to improve customer retention, define what impact you want to have. Do you want to reduce customer churn by a certain percentage or increase the number of repeat customers? By how much? Once the goal is defined, develop a roadmap that outlines the steps you need to take to achieve it. The roadmap should be designed with your OKRs in mind, ensuring that each step will move you closer to your desired impact.
The #3 Rule - Manage an investment portfolio - your roadmap must deliver short term wins and plan for long term growth.
It's important to maintain a balanced portfolio of projects that can deliver both short-term impact and long-term growth, while being mindful of how you allocate your resources.
One approach is to divide projects into three categories: Incubate, Invest, and Debt.
Incubate projects (20%) are the big bets that have the potential to deliver outsized returns over multiple quarters. These projects require significant investment and patience, but the potential payoff is worth it. Incubate projects are where innovation thrives and where the most exciting breakthroughs can be made.
Invest projects (60%) are focused on short-term to medium-term impact. These projects solve immediate customer pain points, address near term opportunities and competitive gaps. They represent the bulk of a company's investments and are essential for maintaining a competitive edge.
Finally, Debt projects (20%) are about keeping the product debt and technical debt under control. This is an essential task that cannot be neglected. Ignoring debt can lead to significant problems down the road, such as a slowdown in execution velocity or increased costs due to technical inefficiencies. By keeping technical debt under control, companies can maintain a high level of execution velocity and stay ahead of their competition.
By balancing these three categories of projects, teams can maintain a healthy portfolio that delivers both short-term results and long-term growth.