From Jobs’ iPhone to Bezos’ AWS: Four Keys to Tech Product Success
A version of this piece appeared in Harvard Business School’s The Harbus on April 12, 2018.
What are the greatest high-tech products and services ever launched? Apple’s iPhone? Tesla Model S? Amazon Web Services? Adobe Photoshop? Windows XP? The groundbreaking Netscape Navigator?
This past year, Silicon Valley executives launched a Product Leader Summit focused on the keys to developing innovative tech products like these. Will your company’s new product be the next Amazon Web Services success? Or the next Amazon Fire Phone disappointment? Summit participants discussed four principles as fundamental to product management success:
1. Assemble a High-Performing & Empowered Product Team
Amazon’s success with AWS, “arguably the best intrapreneurship venture of our time,” stems from its ability to assemble an autonomous, high-performing product team led by Andrew Jassy. That team was fully funded and enabled, which according to Spero Ventures Partner Ha Nguyen, is key.
“You want the product team to be very empowered to make the decisions,” says Nguyen. “If you’re simply giving your product team a list of projects or roadmap, you’re doing it all wrong.”
High-performing teams should have key members in specific roles, including a product manager, designer and engineer — and that it is critical they are co-located to enhance their collaborative work. “It doesn’t simply mean that you’re in the same building,” she says. “You want them to be co-located. Together.”
She also adds that these teams need to be focused on results, not simply steps and tasks. “Allow teams to make decisions based on the data and on outcomes,” Nguyen says. “Give the product organization KPIs or objectives and then allow them to work through the process of customer discovery, product discovery and product validation.”
2. Identify Your Target Customer & Their Underserved Needs
With your product team assembled, how do you ensure you are focusing on the right goals?
Dan Olsen, author of The Lean Product Playbook, emphasized the importance of putting target customers and their specific needs at the center of the product development process. He outlined how target markets should be defined:
“You define your target customer by capturing all of the relevant customer attributes,” he says. “These attributes can be demographic, psychographic, behavioral or based on needs.”
The latter — needs-based segmentation — is critical, because target customer segments may wish to buy the same product for very different reasons. Olsen also discussed how to prioritize opportunities and identify which under-served needs to target by using what he calls “The Importance vs. Satisfaction framework.”
Olsen points to the growth of ride-sharing services such as Uber and Lyft as stemming from successfully addressing important but underserved needs, including convenience, affordability and reliability.
“[These types of needs] offer excellent opportunities to create customer value,” Olsen says.
3. Avoid Overkill by Building a Wedge First
With target customers and needs in your crosshairs, Box CEO Aaron Levie adds some parameters to the focusing process by emphasizing the importance of starting simple.
“You see a lot of early-stage products that are insanely feature-rich,” he says. “They will never be disruptive, because you’re trying to be more comprehensive than the incumbent as opposed to simpler and just focusing.”
Levie’s advice to product teams at emerging companies is for them to ask themselves, “Is there a better way to create a wedge into a user base that you can then expand from?”
He points to his own example with Box, which took market share from feature-rich Microsoft SharePoint at just the time that file-sharing across users and devices was becoming exponentially more important. He encourages focus and warns of feature creep, saying feature requests “can truly wear down your entire product or engineering organization if you don’t think about these properly.”
How do teams balance and prioritize external requests and needs with the need to focus? These are “moments of truth,” explains Levie. “You really have to be insanely clear in your North Star.”
4. Persevere Through the Valley of Despair
With your team, target customers and needs, and focused strategy in place, everything should progress steadily, right?
Wrong.
In the case of Apple’s iPhone launch, months before their shipping deadline there were “seemingly insurmountable hardware hurdles….Apple’s employees scrambled as managers bickered and executives locked horns.”
This is not uncommon, says Deb Liu, Facebook’s Vice President of Marketplace. She describes the frustrating iterations and restarts required to manage product development and launch-oriented struggles as the “valley of despair.”
At these junctures, she says, product teams must persevere. She describes launching Facebook’s mobile app install ad product in 2012 after several disappointing pilots: “We said, ‘You know what? We’re just going to figure this out together.’ And we did. Each time we had a challenge, we sat in that room and we puzzled it out.”
Liu’s team succeeded in piecing together the mobile app install product to the tune of hundreds of millions of installs and a run rate of hundreds of millions of dollars per year within two years.
Facebook’s Current Challenges
Now, with Facebook’s major data privacy issues turning in to ongoing front-page headlines and hours of Congressional testimony by its CEO, Marc Zuckerberg, the company as a whole is facing an entirely new “valley of despair.” How the company’s leaders respond, along with the new services and features they launch to protect end-users, should prove just as insightful as any of these four principles for product leaders.
Philip Levinson is Vice President of Marketing at EdCast, which uses artificial intelligence and machine learning to provide distributed knowledge cloud platforms for enterprises, including HPE, Dell EMC, Walmart, Schneider Electric, Accenture and others. Follow him on Twitter here.
