As Consumers, how often do we measure the value of a product by the amount of stuff it offers?
As Product Makers, how often do our Companies measure our progress by the amount of stuff we produce?
Outcomes over Outputs
It’s common for Companies to mistake making stuff with making progress. But stuff is not a real measure of value. Features can be finished, and delivered, and work perfectly, but still not provide any value.
One fundamental problem of this output-based planning is that it makes it hard to prioritize work. How can you figure out what features are important if you aren’t sure which ones will deliver value?
Not less worrying, planning around outputs limits teams’ agility and problem-solving flexibility. They will feel no real sense of empowerment or accountability and no passion for the problem to be solved. What a waste! We need teams of missionaries, not teams of mercenaries.
If features don’t automatically create value, we shouldn’t use them as the center of our planning process. We want a process that makes it possible to make as little stuff as possible and still achieve the outcome we seek — outcomes over output.
Let’s have value at the centre of our process then! Well, it’s not that easy. Value is a tricky word. It’s too vague to keep everyone aligned. It’s too big for any team to target, and it makes it hard to track progress. It’s the opposite set of issues. Instructions shouldn’t be overly prescriptive neither too broad.
If only there was a strategy to navigate this abstract world of outcomes…
Strategy over Plans
A good strategy isn’t a delivery plan. A delivery plan picks a big output and breaks it into smaller outputs. So, execution and delivery can be done separately (and then you call it Agile… *sigh*).
We want more than that. We want to be driven by outcomes, not outputs. Therefore, what we should do is break up the sense of value instead.
Let’s divide the business into levels, from the tiniest product details to the most oversized market entrances. The more detailed a level needs to be, the more concrete its sense of value should be.
By narrowing the playing field as needed, we enable action to achieve the desired outcomes. “This is your playing field, and these are the results that would make you win the game. Now go, strategize and play as you find best. You’re the expert, and we trust you!”
Each level will do these magic strategic steps*:
- Understand the direction
- Evaluate the current position
- Identify pitstops or obstacles on the way
- Decide how to attack those
- Understand how to recognize success
- Retrospect, learn, adjust and inform back the direction
*(Any similarity with the Product Kata isn’t a coincidence.)
Steps number 1 and 6 ensure that all the playing fields are aligned in the same direction. To understand direction, you are first looking at either the Vision, Business Intent, or Product Initiative, depending on your level. But then it’s a cyclical process throughout the organization.
Vision is the keystone in strategy architecture. It sets the ultimate direction and provides meaning for everything that follows. Having a strong Vision enables you to work backward and understand which goals you need to achieve to get there. It’s key to making sure everyone at the company makes decisions that move the product closer towards making it a reality.
To have a Vision, you need to take an educated guess about an exciting possible future. Just have an opinion based on trends, patterns, and current happenings you see in everyday life. Then create an opinion of where you and your team can fit into that future — whether that’s 2, 5, 10, or 20 years from now.
Magic questions to define Vision:
- How does the future look like?
- How can we fit into that future?
Although the Vision is clear, the hard part is connecting it back to the company’s operations. You have to find a sustainable way to get there.
This is where it’s necessary to specify key business intents to make a big leap forward. They will communicate the company’s current areas of focus. They will probably be about increasing revenue, increasing market share, entering a new market, reducing operating costs, reducing churn, etc.
Magic questions to define Business Intents:
- What is the Vision?
- How are we in relation to reaching that Vision?
- What are the business challenges still standing in our way?
- What would be the next big leap forward we could make?
- What is the impact we expect to get?
Afterward, the question is how the entire company can rally around these intents and crush them. This is where Product Initiatives are defined and aligned.
Product Initiatives answer how you can reach these business intents by optimizing your products or building new ones. The best answers are linked to real problems that users want to be solved.
Your users’ behavior is what drives the business, and a Business Intent won’t happen without changes in that behavior. Anticipating human behavior is the critical link between the Product Initiatives and Business Intents.
Think about what behavior changes would benefit that particular Business Intent and what problem you can solve to generate that behavior change.
Magic questions to define Product Initiatives:
- What Vision and Business Intent are we serving?
- How are we in relation to reaching that Vision and Intent?
- What are the things that our users do that drive the business results related to that Intent?
- How can we get people to do more of those things?
- What is the outcome we expect to get?
Options are like bets (Spotify even calls them like that, I believe). They are hypotheses. They represent the possible solutions that you’ll explore to solve the Product Initiative.
Sometimes the solutions will be obvious, based on best practices or previous work. Other times you will need research and experimentation to find and test solutions.
Not all options you come up with have to be shipped. Hopefully, many of them won’t be. The best thing you can do at this point is to kill the bad ideas. That is how you reduce the complexity of your products. Remember, it’s about quality, not quantity.
Magic questions to define Options:
- What is the Product Initiative, and what is the desired outcome?
- How are we in relation to reaching that outcome?
- What is the obstacle in the way of solving that problem/challenge?
- What are the different ways we can address that obstacle?
- What is the checkpoint we expect to reach?
Up, down and across
Through this act of exploring and identifying problems, you uncover data needed to help inform the Business and Vision. Vision is not solely set by top-down management, although it starts there.
The entire organization should be sharing information as they learn about what will reach goals. This process of communicating data and direction (up and down and across) is how you maintain alignment and understanding.