There are many ways to skin a cat, so the old saying goes (a terrible expression that it is!). Product planning of software and hardware tech products seems to fit in the same category.
There are some models that you tend to see over and over again. And there are a lot of different ways that the planning of products occurs in the technology industry. Also, there are new buzzwords for this activity appearing all the time. “Customer Development” became the rage for a while. However, the fundamentals of good product planning don’t really change. And no, communities built around SaaS business models don’t obsolete the need for product management & planning as I wrote here.
Technology-Driven Product Planning
One typical method of planning hardware and software products is what I call a “technology-driven” approach. That’s when an engineer, software programmer, or inventor comes up with a new way to apply existing technology to a problem in a better way than other products that currently exist. Or in some cases, the developer is a true visionary and actually invents a new breakthrough technology that blows away the existing way of doing things.
While this technology and developer-driven model is widespread, and when it works it can lead to blockbuster successes, this approach is often rife with problems. In my consulting practice, I have been brought in often to clean up the results of this particular product planning approach. The reason for this is that companies using this approach usually have an overall technology or product-centric view of the world. And what’s missing in the view?
Customers must be a key ingredient
Now I don’t want to insult all the technologists out there who have taken the lead in developing products. Of course, many technology professionals understand the need for customers and the importance of getting their feedback in the product development process. Some have a natural knack for product planning and are highly effective at it. Yet the reality is that product developers aren’t trained to, nor do they generally derive pleasure from this activity. Trying to extract product preferences, unsolved problems, and workflow issues from potential customers is very different from their core training. Let alone put all of this customer feedback in the bigger context of an overall MARKET.
In addition, customers often don’t really know what they want or have some other agenda which can lead any product planner in the wrong direction. Unless the planner is experienced and savvy in uncovering the desired information. Let’s face it, developers are trained to design hardware or write software code. Many do pick up product planning skills—but in my experience, it’s not generally a natural fit with their interests or training, and far less than the majority that tries excel at it.
Works best at the next bench
This technology-driven approach tends to work well when the product is being developed for what is referred to as the “next bench”. What this means is that the product developer is creating something for themselves or their buddy at the bench next to them. Since they are in a sense the target customer for their own development, this can work and often does.
Unfortunately, a common end result of a technology-driven product plan is often one that is launched and does get a few customers. But the product then stalls long before gaining full traction and critical mass in the marketplace. Precious cash has been burned through and a typical lament is “it’s a great product if we could only find someone to sell it”. What is frequently believed to be a customer-facing sales and marketing issue is quite often actually a product that doesn’t meet broad market needs in some respect. This is a result of flaws in the product planning process.
Customer-Centric Product Planning
Another common way that I’ve seen products planned is what I call the “customer-centric” approach. This method is characterized by focusing on a few “model customers”. This is coupled with a fanatical devotion to using the input of these few customers to develop the product. Often you will see this in a company that has previously failed using the developer-centric model discussed above. Sometimes, it’s the same technologists on their second try. Now you may be thinking, this is the way you do it! But while this approach is definitely an improvement in some ways over a purely technological approach, it too has some limitations.
Homogenous, niche markets
The customer-centric model works well if you are developing for a very limited, niche market—or at least one that is quite homogeneous. The problems occur in two areas. First, if your target market is heterogeneous, it is easy to miss that part of the market that isn’t represented among your select few model customers. That miss can sometimes represent a LARGE part of your target market. Secondly, this approach can sometimes stifle innovation. In high technology, input from major customers is very important, but key customers shouldn’t be doing your product planning for you. Each has its own quirky agendas, unique to its individual companies.
In addition, even your best customers often can’t see far enough past their current problems and needs to imagine how to best apply new technology to create a radical improvement in their future workflow. So if you only build what they tell you to build, you will often end up with a “state of the art today” product. In addition, it will contain a few features that the larger market will scratch their head over why they were included. Worst of all, the product may be nearly obsolete by the time it hits the streets. This usually happens because you haven’t looked far enough ahead of the market and built in what’s possible and desired for the future. These products get stuck in the present of when they were planned, which in the tech world is the distant past by the time they are introduced into the market.
Market-Centric Product Planning
Finally, let’s talk about the way most tech products OUGHT to be planned and built. I call this approach a market-centric model, which includes elements of both the customer and technology-driven approaches.
The most basic requirement for success in this approach is to have a skilled, balanced product planning team. The core of this team consists of an experienced Product Manager with a marketing background and an experienced Engineering Manager or Technical Project Leader. I call this the “2-headed monster” of product planning.
The two-headed monster
Having two leaders for a project sounds like a prescription for design-by-committee, which usually satisfies no one. And there are definitely dangers to this approach. The most problematic (and frequently encountered) issue is when the Product Manager and Engineering Lead clash. Maybe they just don’t like each other. Sometimes the differences in marketing and engineering mentalities create an issue, or they clash for other reasons. Then you have a real problem—and one that must be dealt with quickly. But that’s a topic for another article. The important thing here is to raise the odds of producing a truly GREAT tech product. Both the Product Manager and Technical Lead possess key expertise that needs to be brought to the table to optimize the product planning process.
The Product Manager is the market expert, and customer proxy when necessary. She/He is trained and skilled at uncovering the true needs and latent desires of potential customers. A PM also has to have a broad perspective. All important market segments must be canvassed to ensure that the resulting offering is MARKET-driven. Not a product shaped primarily by the love of cool technology, or peculiar requests from a few key individual customers.
The Technical Lead brings a couple of critical skills to the table. He or she keeps the discussion centered on what’s POSSIBLE, ensuring that you don’t plan a product that can’t meet the required timing and budgetary constraints. Worse yet, one that can’t be built at all! In addition, he or she can “see ahead”. This enables the injection of new, upcoming technology to solve a problem in a way that those less technical might not be able to envision.
Not perfect either
I won’t pretend that this approach to planning products is easy to implement. In truth, it’s hard to pull off. The key ingredients to success for this model are an honest, open process and culture. One where everyone is motivated by the success of the product and ultimately, the company. In companies with a high degree of politics or rivalries between departments, the process tends to fall apart quickly. This is to no one’s benefit or satisfaction. Immature individuals driven by ego or focused on their own wants and needs will also quickly sabotage the process. Mutual respect between the key players is critical. Lastly, openness is also key. Anyone is allowed an opinion on any product aspect, whether technical or market-oriented.
An engineer can express an opinion on the customer base or marketing approach. A marketer can have an opinion on what technological approach is most appropriate. This cross-fertilization of ideas is very valuable and leads to innovative approaches that aren’t derived from orthodoxy. At the end of the day after all the discussion has taken place, there must be mutual respect. There also must be trust in the competency of each functional area. At the end of the day, marketing people must be most trusted on marketing matters; developers must be most trusted on engineering matters. If trust isn’t there, a successful product as an end result becomes far less likely.
Best for Success
When done right, the market-centric approach to product planning is almost always optimal. It usually leads to solid singles and doubles, with the occasional home run. It reduces your risk of an outright flop. While also increasing somewhat the normally long odds of creating a blockbuster, market-leading product. A company is poised to introduce a succession of market winners, once its product planning process has evolved to market-centric.
That’s my take on planning great hardware and software tech products. I’m sure with some people my view will be controversial. What’s your view? Post a comment or drop me a message to discuss.
Follow Phil Morettini and Morettini on Management via Twitter, Facebook, LinkedIn, RSS, or Subscribe to the Morettini on Management Newsletter hosted by LinkedIn. Contact Phil directly at email@example.com