Build the right product and build it right

Most firms operate in a opportunity rich environment. It’s often a question of which problem(s) to focus on, which pain point(s) to solve for to drive impact for the user, the business and if scaled well, for the industry at large.

As Product leaders, it’s our duty to ensure our firm is betting on the (solving) the right problem(s) at the right time.

A simple framework to ensure that is to stage-gate our work into 3 phases, keeping in mind it’s not always a linear progression. The more thoroughly we work on phases (1) & (2) the more we can de-risk.

1. Problem identification & validation
2. Solution exploration
3. Build & iterate

Problem identification & validation

This phase is about identifying the right problem to solve. The “right” being the operative word, and needs to be deduced by analyzing the problem from a few lenses.

User lens

Start here. We may already have an intuition about the problem the user has, as well as a potential solution in mind for that problem. We shouldn’t be tempted. We should take a step back and think about when this problem manifests for the user, what’s the overall job s/he is performing at that time? Do we feel like we’ve a strong understanding of this job (or someone in our team/firm has)? If no, go to step 2. If yes,

Step 1: Baseline

Based on our intuition and current understanding of the user’s job, applying frameworks such as jobs-to-be-done, we should map out the user journey for this job. Then, for each step in this journey we should identify the important and under-served needs that we believe exists for this user. Now, we can review this map and see where the original problem stack ranks against all the needs in this journey. This forms our baseline understanding.

Step 2: Get out of the building

Often, this might be our step 1. We should reach out and talk to the users about this job (and/or observe them as they go about this job) and understand their journey deeply. Subsequently, we can build out the job steps and the unmet needs (or revise the existing version). If this was our step 2, then we need to take extra care to ensure our user research is unbiased and that we are staying true to what we have heard vs. what we already believe as truth.

If we’ve done the above two steps well, at this time we should have a clearer understanding of the problem(s) the users are facing and exactly what kind (segment) of users have this problem.

Business lens

Step 1: Market sizing

As we develop a better sense of who the user is & their unique attributes, it’s a good time to analyze exactly how big is this segment. We may have a clear view of the user’s journey and their unmet needs, but if there aren’t many such users out there then it may not be a problem worth solving for. As such, at this time we should open a spreadsheet and estimate the Total Addressable Market and Serviceable Addressable Market for this opportunity.

Step 2: Competitive landscape

Let’s say, we were fortunate and for this particular problem we estimated the TAM to be in the billions of dollars and for this particular segment of users and the potential value prop we’ve in mind, the SAM is in the hundreds of millions of dollars. That’s not enough to jump start the solution phase. We need to critically analyze how the job is done today. What alternatives are being leveraged by the user to solve this problem today? How well do they solve it?

Keep in mind, while we may be thinking of solving this problem purely using technology, existing alternatives maybe a mixture of people, process and technology — so we need to look broadly.

Assuming we did a thorough review of the competitive landscape, we should now have a good grasp of how compelling this opportunity is, and what kind of impact we can provide to the users and in turn the value we can expect to generate over time. This understanding should inform our investment strategy for attacking this problem.

Step 3: Moat

Now, before we decide to start working on this problem we need to ascertain if there are any special reason(s) why we may be better positioned to arrive at a 10X solution than the incumbents or future competition. What do we have that others don’t? If we are able to identify something meaningful here, whether it be proprietary data/tech, exclusive partnerships etc. the odds of eventual success goes much higher.

Step 4: Timing

Assuming we have reached here, we need to assess whether the timing is right and what’s our window. Many external and/or internal factors could dictate this. Reviewing our user research and competitive landscape are some ways of assessing whether the timing is right.

And it’s important to pay attention to all these constraints so we can define the trade-offs across scope, budget, time appropriately.

Step 5: Monetization

Eventually, a good business has to generate a high return on the capital invested and it’s never too early to think about how we will achieve that. The focus at this stage isn’t to go crazy building complicated revenue models, but broadly define what possible revenue stream(s) are there, and what are some metrics that we can measure as an early identifier for value generation for the user. This is critical to ensure we have a long-term view of the business and can be rest assured that monetization is a lever we can pull at the right time to achieve max impact.

Step 6: Go-to-market

While we don’t need to put together any detailed go-to-market plans yet, it’s nevertheless a good practice to think about how we will reach the users in this market segment. Understanding what channels/resources did the users use to discover the existing alternatives will inform where we should focus our marketing spend. If this is a new segment we are targeting, we may not yet have developed the marketing muscle to effectively tap into the best channels, so the earlier we brainstorm the go-to-market strategy, the better prepared we could be when the time comes.

Business model canvas

Once we have reviewed the problem from both user and business lenses, we can capture all the various pieces of the puzzle into a lean business model canvas. This 1-pager is a great artifact for communicating to other stakeholders about the opportunity as well as for on-boarding a cross-functional team.

Now, as you can imagine, this canvas is a land-mine of assumptions that we need to de-risk as we enter the Solution exploration phase.

That’s a topic for another day!