In this weeks’ podcast, we jump straight back into our chat with Daniel Harris about customer-centricity and developing that mindset in product management. Let’s get straight back to the chat! Go check out part one of this conversation if you missed it.
Featured links
Featured Links: Follow Daniel on LinkedIn and Twitter | ‘The State of Customer Centricty’ model at CX Partners | ‘Developing a Customer Centric Mindset’ talk by Amon Kiplagat at Mind The Product ProductTank Birmingham
Episode transcript
Lily Smith:
Welcome back, listeners. We’ll keep this short as we’ve already done a silly intro for part one of this interview. If you haven’t listened to that, then go and check it out, not the silly intro, but part one of the actual interview.
Randy Silver:
So this is our not so silly intro for part two of our chat with Dan Harris from CX partners about their study on customer centricity for large organisations, and how you can measure this and level up your organisation.
Lily Smith:
So let’s get straight back to the chat. The product experience is brought to you by mind the product,
Randy Silver:
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Lily Smith:
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Randy Silver:
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Lily Smith:
minded product also offers free product tank meetups in more than 200 cities. And there’s probably one more you on the kind of strategy side of this, you know, when we talk about making product decisions, you know, there’s, there’s the sort of tactical, smaller day to day product decisions. And then there’s like defining the product strategy. You know, often, when you’re defining your product strategy, it’s got to be tied in with the business strategy. So there’s a bit of there’s an element of, you know, market research and analysis and, and potentially, like financial modelling or, like understanding of pricing, or, you know, all sorts of the kind of what I would consider more sort of business analysis that goes alongside that. So, you know, when we say like, don’t let your leadership make product decisions is that kind of, you know, give or take, rather than a heart, like, they’re not allowed in the room, they’re not allowed
Daniel Harris:
to do to do that. And no, I, you know, of course, all of that activity has to happen. You know, one of the biggest findings was that, you know, high performing organisations use a blend of research. So they will, they’ll use market research, they’ll use survey data, and they will use qualitative as well. And I think that makes the difference, actually, between whether you’re highly mature or not, if you blend it with qualitative, it will make all the difference, if you imagine, you know, pricing. Of course, there’s lots of data out there for how you should, you know, potentially price. But there’s also, you know, a creative question in there, you know, if we are creating Creating this product for, you know, a new market to solve a different problem, then actually, what is it worth to customers? And that is a question that you have to take out to customers themselves, they will tell you what they’ll pay, they’ll tell you more than that, they’ll tell you what it’s worth to them at a deep level. And I think that is that is the difference between the highly mature organisations and the not so mature organisations, that is that they’ll take that business analysis, and they’ll make a decision off of that alone. And that that is where there’s a real risk to business. So,
Randy Silver:
Dan, one of the amazing things that you uncovered, which is going to be music to lots of people’s ears, but potentially also a bit dangerous, is you’re talking about product managers should have a strategic role and not just be backlog managers. So that’s great, unless the business decides that the people in the role aren’t up to that. But how does what does that actually functionally look like on a day to day basis? What kinds of people are they hiring? How are they performing in the organisation? What is the role of a strategic product manager and who is doing the backlog of management in these organisations?
Daniel Harris:
So what’s great about product management is that there are three fires to fight all the time, the three fires of technology, customers and business. And it’s, you know, I can’t think of another role apart from in the C suite where people have to think about those three things at the same time. So for me, product management is absolutely strategic. And what I think has happened over the past few years is i My question is whether that has been slightly eroded that idea that Product Management is at the heart of creating value out of those three really big things, creating value out of technology, creating value for customers creating value for business, that is a very complex thing to do. And so that might be why we’re seeing quite a lot of data show up in the in the report that tells us that, you know, product managers are, you know, certainly low, low maturity organisations are, are simply managing backlog, and then they’re not really making a decision on product. Now, what does it look like? You know, a strategic product manager is someone who is, you know, taking data taking insights, you know, working with designers working with team, they’re creating prototypes, together, they are testing ideas, you know, with other teams, or with customers, they are being highly collaborative with themselves with other teams, they are taking insights and, and showing the business, just what is at stake, you know, in terms of customer problems, they’re showing them the opportunity for solving those customer problems. They’re working with leadership to turn that into a strategic roadmap. There, they’re using that roadmap to inform how they put backlog together, how they put features together, but they’re not, they’re not worried about features, what they’re worried about is customer problems, they’re worried about the how might wheeze, they’re worried about the challenges and the pain points that customers have, and that’s what they put on their backlogs, they don’t put features on their backlogs. Now, for me, and for a lot of those highly, highly mature organisations, that is what product managers do. And anything short of that you’ve got a real, actually, it becomes more of a friction point where customer insight doesn’t flow through to other teams, and so the organisation and, you know, the product teams that are going to create the solutions. So that’s, that’s where I, I’d say, product managers, that’s the role in a highly mature organisation. And it’s not just them, it’s how they are nurtured and set up within the organisation. What we’re talking about here, I think, is the product managers, their employee experience, you know, if you can get it right, give them the right tooling, given the right processes, the right governance, then they can thrive and and do that work for you.
Lily Smith:
So, obviously, like speaking to, or could have done this research with lots of different businesses, and you work with lots of different businesses in your kind of day to day as well. Did you kind of uncover the reasons why organisations kind of end up with product managers more in that sort of backlog grooming situation, rather than in a more contemporary sort of modern idea of like, or the best idea of a strategic product manager?
Daniel Harris:
Yeah, well, my, you know, we didn’t do a huge amount of research with organisations that were probably scoring lower on the on the index, we did a lot of research with those that scored highly. So what we know about the highly mature organisations is that, you know, they’re their product management functions are contemporary, they are strategic. You know, our experience with working with, you know, lower, lower maturity organisations, tells us that, you know, that we’re in those complex organisations, those complex environments, perhaps product management is, is a, a unit or a department on its own. And it’s about, you know, probably scaling, you know, the organisation needs to scale and grow and build digital products. So they need people that they can put into those roles. And that might be, you know, something that they need to accelerate and maybe place, you know, people that that don’t really have the experience to bring a strategic perspective to product management. That might be what’s going on.
Randy Silver:
So, Dan, for those product teams, how do you organise them in high performing organisations? There’s lots of debate about do you put them together in functional areas or business lines or customer problems? What’s What’s the thing that you found if anything that was consistent?
Daniel Harris:
That’s great question consistency, you know, came from you know, just the the high level data, we found that, you know, highly mature organisations had product managers and researchers, that those in particular those two roles were were strategic roles, product managers would work with cross functional teams. In highly mature organisations, a couple of the companies we spoke to over interviews, they told us how they built the teams, and structured them in a way that really broke down silos within their organisation. This was, this was something that was absolutely fundamental to this organisation. In fact, this company scored the top score, they were the only company to score the top score. And in fact, they had an annual revenue growth, that was way off the charts, they represented that sort of hockey stick the end of the hockey stick for our data. So we needed to, we actually removed them from the dataset, because it was looked like an anomaly. But at the same time, they performed they outperformed everyone else in many, many different ways. And their story is really one of how they structure their whole organisation around self organising, you know, collaborative teams, they talk about, they talk about their people actually, as they talk about this idea of dry stone walls. So you know, dry stone walls are made of different shaped bricks, different shape stones, that, you know, if you fit them together really well. You don’t need any cement or mortar to keep it together, they hold themselves together in these walls, they use this as an analogy to, to talk about their teams, their people, they hire T shaped people who are able to, you know, be flexible enough to move and shape around others, and collaborate therefore collaborate really well. But they have a depth of knowledge in a particular area. And they, they’re sort of maniacal about automating as much as they can with their software. So they have their support centre agents working with their developers in these sort of pop up product management, you know, teams, that they work on software, they have a piece of software that they actually sell to other companies in their industry, they’re in retail energy sector, they sell their internal support centre software to other companies. And what it does is it allows them to, you know, record their conversations with customers go back over the history, it allows them to, in small teams, understand problems of their customers, and, and really bring, bring them into product teams very, very quickly. And it’s having that sense, that cadence of being able to know what the problem is spot the pattern and iterate around that, that that really sets them apart from other organisations that we know of.
Lily Smith:
So that sounds, you know, that sounds kind of amazing, and I’m sure everyone will be wondering who that is and be wanting to go and work there. I’m just wondering how that translates to other organisations, you know, where you have a variety of different ways in which customers interact with a business, whether it’s with kind of a sales organisation, or marketing touchpoints as well. And then also customer support, or kind of use of a product, whether it’s like a SaaS product or, or whatever. It feels like if you had, you know, all of these kinds of mini teams working on customer problems in their own silos, like you could end up with just chaos. Rather than, like, extreme growth.
Daniel Harris:
Yeah. That growth idea is, I think, a result of how they’ve been doing this, okay. I don’t even put it in as much as their customers have been absolutely part of their growth story. So this company has grown, you know, revenue wise, over 200% per year. It’s quite astonishing. They’ve gone from 10,000 50,000 to 500,000. They’ve got a million customers within, let’s say, I think it’s four or five years. And one of the reasons they talk about is you Have some of those other functions like marketing to your point, you know, as I was talking about, you know, the Support Centre, but in terms of marketing, they’ve taken an approach where it’s, they’ve tried to make it as one to one as possible. So, you know, of course, you could think about scale, from a technology point of view, you can think about it from a product point of view, you know, but what what this company did was, say, well, actually, if we are one to one with our customers, as much as possible, we can find out as much as possible at a really high level, and we’re talking, you know, CEO, regularly, emails, new customers who join, and if we are at that level, you know, we can have these conversations, and we can learn about what their problems are in the moment. And that can flow into how we develop our services for them, it can flow into how we send out communications to them, because we know actually, if if there’s a, there’s something that they don’t need to know, and they don’t want to know, we can take that out of our communications within the hour. And that means that they’re learning about customers, their customers are teaching them about how they can run their business to serve all their other customers that they want to gain. So you could see it as a, okay, well, there’s product over here. And then there’s your customers, and your customers, in this instance, are an incredible asset. Why wouldn’t you want to get as close as you can to them, and bring them in as far as you can and let them influence? You know, of course, with intelligence, and all the checks and balances and all the regulation that you have to adhere to, but bringing them as sort of seeing them as the asset, I think made all the difference the, for this, this organisation, and they’ve structured their entire organisation around that your original question was, you know, is it chaos? When we spoke to them, they talked about lots of things that they put in place to make sure there wasn’t chaos. And those things like you know, they have regular weekly, Friday, they call them Friday night dinners, and the entire product marketing team comes together for an hour, and they just share stories about the you know, what they’ve been working on with customers, they have in place, this idea that, you know, everyone is, is actually a leader, and they communicate with the staff in a way that will, you know, we’re all working towards one goal, one mission here. And when you have the, all the freedom responsibility to be part of that, and really take that out, and build what you need to for customers. And, you know, for the right people, and they hire the right people that are willing to be be curious, kind of get out of their comfort zone and not do the things they’ve been told to do but do the right thing. They have an organisation that they’re highly collaborative, they are they, they want to learn from each other. So they they automatically, you know, find out what small other small teams are doing. And figure out if there’s a pattern that they can use over here and their team, they have managers that focus on nurturing their team members, holding the conversations about, you know, their careers and what they’re doing. And they take on a sort of, as I said, at the start is sort of servant leadership, they are trying to make sure that their teams have the right things in place, the right facilities in place to do their best work. So they they’ve taken it feels like they’ve taken everything that traditional organisation has had ingrained in it for years. And they’re just picking up bits of it and turning on his head and saying, No, the insight comes from over there. It comes from customers doesn’t come from inside it comes from outside.
Randy Silver:
Again, we’ve got time for just one or two more questions. But you one of the other points that you talked about flows really nicely from this, which was about how communication is a true catalyst. And I mean, you’ve just talked pretty eloquently about it, but is there anything you missed?
Daniel Harris:
Yeah, I’ve got some data. I want to put I want to furnish, furnish what I’ve said with with with some data we, so how did we score organisations on communication? We measured how well Insights were communicated up to leadership. And we also measured how strategy was communicated to the broader organisation, as well as between teams. And what we found was when an organisation scores really highly on communication, that has an incredible compound effect on their maturity overall, so that it has a compound effect on all the other dimensions of compound of you know, it improves how they, you know, how their people work, how the processes work, or facilities they have, you can imagine, you know, why that is, if you’ve got great communications in place, then everyone knows what they’re doing, they can be coordinated, the team can be coordinated. So that was, that was a really, it was really nice to see that, that that was that was there, you know, the hunch that we do have had, similarly, if, if organisations were low scoring and communication, it really dragged them down on every other dimension. So it really is one of the most important for me, it’s the most important dimension here. Now, what we found was to some of those questions, 90% of the highly mature organisations, they told us that they were aware of other teams work, and they were aware of strategic goals. Now, contrast that to just 5% of low maturity organisations, when not aware of each other’s work or about broader strategic goals, there’s real, you know, huge contrast there. And there’s, there’s two ways in which communication is important. Firstly, about quality, quality of communication. Secondly, quantity. So, you know, quality is key. So, what we heard from one of our participants was, it was actually bla bla car, they were a cost sharing site in France. And they talked about the CEO, putting together a customer vision video, and this was quite some years ago. And that still being cited and referred to years later. And what that tells you is that, that there’s something so important about telling something that’s really highly emotive and highly inspirational. And it really helped the team understand where they were going with their customers and with their product. So really communicating a high quality level high, you know, a rich, high fidelity level is, is important. And then you’ve got quantity. We describe this in the white paper, as being you know, if you’re relentlessly communicative, that makes a massive difference. And it is, it’s about being relentless. If you’ve got something great, if you’ve got a great strategy, if you know how you’re going to solve problems, or you know that there are massive opportunities in the problems that you’re seeing, you’re going to want to talk to your team about that. And we found that, you know, if you do that, and yes, it’s exhausting, because you have to be you have to do it all the time, we found that organisations that that did it regularly, that communicated regularly and put it into employee onboarding, for example, you know, that was really about, about making it very clear. All the time. Everyone knew that they were on the same mission on the same path. That was really important. It’s about doing it regularly.
Lily Smith:
So when you say relentlessly, like, like, I just have this like horror, like feeling like this horror, sort of image of slack with like, just 20 million channels and like, 20 million messages, and each has different channels. But I guess, I guess what you mean is, is it just like the core, like the core strategic messages and the mission and values? And that’s the bit that’s relentless, rather than?
Daniel Harris:
I think it’s the values? Yeah, you put, you put that? Yeah, put your finger on it there. I think it’s about values. I think it’s, you know, you want you want diversity in your team, because you want them to take the same values, but look at them in different ways. And if people are reminded of those values, and you celebrate people that have really gone a long way to meet those values, then you know, you’ve got a great organisation that knows that it can communicate with each other really well. And you encourage that communication across teams as well. So it’s what when I say relentless, I don’t just mean it’s, you know, top down bottom up, it’s, yeah, it’s not slack disaster. It’s a slickness in communication across the whole organisation and across teams.
Lily Smith:
So we have just one more item on this list, which we’ve kind of split this effort this interview into two parts, and we’re still running out of time. Let’s just really quickly touch on the last point, which is all around service design. So, you say these kind of high performing organisations think about service design, but is this in every single organisation that there they have service design capability,
Daniel Harris:
we did find high correlations of service design ability in highly mature organisations. So, you know, there is it is important. Now, what I’d also say is that there were other roles that we surveyed, like content design, which which we found that, you know, there was a correlation as well, as well as product management, of course, service design did come come through, I think it’s what it’s been highlighted its value last few years, because a lot of government services are now developed by service designers. That’s what, certainly in the UK that government digital service really promotes. And when we talk about service design, we’re really talking about, well, let’s make sure that we’re considering all of the touch points, and we making sure there’s no gaps in the touch points, what can happen is that product, product teams can get into features. And, you know, the consideration of the full service end to end is hard for product teams to actually consider. So when when we’re talking service design, we’re saying, if there are roles that can have the perspective, quite empowered role, to have the perspective across portfolios across products, so that the experience overall the brand experience, the offline, the online experience, is coherent for customers, then you’re going to really meet their needs, and not drop the ball at a certain touch point, it often happens that, you know, the mobile web version is something that isn’t quite up to date with another version of a service. And, you know, it’s just an example of where things can fall down. Now, really, what I’m talking about, for for most organisations is, you know, yes, great if you can have service designers as a role, but what I’m really talking about is think service design, to think about, considering, you know, all of the stakeholders, actually in a in a service, and you can see when it goes wrong, when people don’t think about all the stakeholders, which are I remember listening to Brian Chesky, from Airbnb, a while back, talking about some of the, you know, authority, some of the local authorities that shut Airbnb down, you know, a number of years ago. And he said, you know, if they’d considered local authorities as a, as quite a major stakeholders of their service at the beginning, that, that they may have had a different outcome. So, you know, for us, service design is really thinking about the system. I talk about, you know, the chair in the room, if you’re designing a chair, you need to design in the context of a room, you need to design the room in the context of a house. This thing is the same with product. And that’s a quote from Eliel. Saarinen, by the way, an architect, you know, where, you know, in order to get it right for that, that feature, you have to think about it in the broader context. I think it’s the same for product teams, product managers, you know, getting their experience right inside their organisation means that it’s going to be right for customers, overall, customers can see this stuff, whatever’s whatever features you have, and however you design them are absolutely a product and a reflection of your internal the way that you’re set up internally. So thinking about it from that systemic point of view is, I think, super important for customers.
Lily Smith:
And on that note, that does conclude part two of our interview with you, Dan, all about high performing orcas and customer centricity. It sounds like it was a really fascinating study. If people want to find out more, is there somewhere they can go to read more?
Daniel Harris:
Yeah, there is a few go to the CX partners website. It’s all there six partners.com and you can download the white paper and take a self assessment as well that will give you a score and a benchmark.
Lily Smith:
So amazing. Thank you. So so much for joining us. It’s been
Daniel Harris:
great. It’s been great to talk to you both Thank you.
Lily Smith:
The product experience is the first and the best podcast from mine the product. Our hosts are me, Lily Smith, and me Randy silver. Louron Pratt is our producer and Luke Smith is our editor.
Randy Silver:
Our theme music is from humbard baseband power. That’s P AU. Thanks to RNA killer who curates both product tank and MTP engage in Hamburg, and who also plays bass in the band for letting us use their music. You can connect with your local product community via product tank, regular free meetups in over 200 cities worldwide.
Lily Smith:
If there’s not one near you, maybe you should think about starting one. To find out more go to mind the product.com forward slash product tank
