In this talk to ProductTank Cardiff product management coach and one-time Google product manager Itamar Gilad looks at how to deal with uncertainty through lean product management.
Itamar starts with a story from his former company Google and how it has dealt with social networking over the years. Google had a social networking service called Orkut as early as 2004. It worked, but for a number of reasons usage declined and the service was eventually shut down. In 2010 Google launched Google Buzz, but the product quickly ran into privacy issues, says Itamar, from which it never recovered. In 2011 G+ was launched, and it also failed. “Even Google struggles with the same core problems all product managers struggle with: uncertainty, “ he says. We used to have predictable markets, customers and business models, but in today’s world of software and the internet, none of these things are true. Instead we have high uncertainty, unpredictability, complexity and constant change.
How do we deal with uncertainty? Through customer focus, evidence-based decisions, agility, and empowered teams.
Customer Focus and the North Star Metric
Every organisation needs to deliver value to the market and capture value back, with the product being the means to this end. Focus on the top KPI makes for a sales-driven company not a customer-focused company, so to balance this companies should also focus on their north star metric which measures the total value delivered to a market. For Whatsapp it’s messages sent, for YouTube, it’s minutes watched, and for Airbnb it’s nights booked.
Once these metrics are worked out, you can create an impact roadmap, says Itamar, and he gives an example of a company showing its north star metric against its top KPI.
Itamar illustrates this with an example, an online video training platform for enterprises. A few key customers ask for 4K streaming support, and sales estimates this feature will generate an additional $6 million a year. But engineering estimates that 4K streaming will double the load on the servers and only 14% of user devices support 4K. Should you build the platform?
Different people will have different opinions, says Itamar. You can estimate impact, or cost, but all of it is subject to bias. There’s a third element, which is confidence – or how sure are we that the idea will have the expected impact. It means looking at the evidence, Itamar says, and he’s created a confidence meter tool to cut through hype and debate and collect evidence.
Agility is not the same as Agile development, rather it’s about our ability to react to new information fast and accurately. It’s about our ability to change our plans.
When we like an idea we tend to build a project around it, Itamar says, but this will always take longer than we think and it means we defer learning until the end. Instead we need to embrace the Lean methodology and start by testing early versions of the idea as fast as possible. Each step in the Lean process, from user study to MVP to A/B experiments to launch culminates in a learning milestone – it’s the concept of build, measure, learn. Itamar says that while we all understand it, in his experience many companies struggle to implement this concept, so he has developed a framework, the AFTER framework, to help with this. AFTER stands for assessment, fact finding, tests, experiments, release, and Itamar shows us how the framework operates.
He also explains the GIST framework (goals, ideas, steps and tasks), it’s a framework that he likes to teach and he says that it also empowers teams. The GIST board is a useful tool for meetings, he says, and helps the team fell more connected with the business and satisfied in their day-to-day work.