Using Lean Principles to Create and Get Traction for Your Product Strategy

© Shardul Mehta 2013
http://streetsmartproductmanager.com
This work by Shardul Mehta is licensed under the Creative Commons Attribution-ShareAlike 3.0 Unported
License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letter
to Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.
Using Lean Principles to Create and Gain
Traction for Your Product Strategy
Shardul Mehta
Presented at ProductCamp DC, May 11, 2013

Important Stuff!
1
This material is licensed to you under the Creative
Commons Attribution-ShareAlike 3.0 Unported License.
View the license at
http://creativecommons.org/licenses/by-sa/3.0/

Hi. I’m Shardul.
• Almost two decades years building and launching tech/software products
• Early career: software developer – Honeywell, First USA Bank (Chase)
• Co-founded cloud based healthcare dot-com start-up in 2000
• Product management, product marketing, product development
– Small business
– Mid-sized company in consumer services and retail that grew from $250M to $1B
– Led digital product management for Capital One’s Card online UX
• Founded ProductCamp DC in 2010: largest product professionals community
in the Mid-Atlantic
• MBA, Tepper Business School, Carnegie Mellon
• B.S., Computer & Information Sciences
2
@shardulmehta http://www.linkedin.com/in/shardulmehta
http://streetsmartproductmanager.comshardulmehta@gmail.com

CHALLENGES
Using Lean Principles to Create and Gain Traction For Your Product Strategy
3

Problem #1
The traditional product innovation process is wasteful
4

The conventional way is to write a business case
5
Concept
Business Case
/
Product
Strategy
Get Approval Execute
• Resources
• Money

Elements of a business case, business plan, product strategy
6
• Executive Summary
• Project name
• Business objectives and business
strategic alignment
• Market/industry analysis
• Competitive analysis
• Product description
• Target customer
• Sales and marketing plan
• Operational plan
• Scale and complexity assessment
• Financial analysis, investment needs,
break-even analysis, ROI
• Organizational areas impacted
(internally and externally), key
stakeholders, dependencies
• Project plan and schedule, critical path
• Required resources - project leadership
team, project governance team, team
resources, funding
• Commitments (required) - Project
controls, reporting processes,
deliverables schedule, financial
budget/schedule

How I used to capture my ideas
7

So…
8
Concept
How do I go
from this…
Business Case
• Executive Summary
• Project name
• Business objectives and business strategic alignment
• Market/industry analysis
• Competitive analysis
• Product description
• Target customer
• Sales and marketing plan
• Operational plan
• Scale and complexity assessment
• Financial analysis, investment needs, break-even analysis, ROI
• Organizational areas impacted (internally and externally), key
stakeholders, dependencies
• Project plan and schedule, critical path
• Required resources - project leadership team, project
governance team, team resources, funding
• Commitments (required) - Project controls, reporting processes,
deliverables schedule, financial budget/schedule
To this?
Business
Case
?
Concept doc?
MRD?
Too much work = wasteful

Too many unknowns
9
Concept
Business
Case
Get
Approval
Execute
You have few facts
Your goal: learning
Your investor’s goal: growth
(a.k.a., write a
big document)
• What assumptions underlie your strategy?
• Have you de-risked your plan?
• Have you found early adopters?
• Are their problems worth solving?
• What key metrics will drive your financials?
Have you built
something customers
want?
(Too late to learn?)

Problem #2
“Plan != Product”
10
- Steve Wendel, @sawendel

11
A business case is a document executives make
you write that they don’t read
Product strategy deck, Concept doc, MRD, etc…
With due respect to Steve Blank’s comment of the similar nature

No love for the business case
12
“It’s a necessary evil. But it’s a wasteful process.”
“It’s a joke.”
“It’s a manager fighting with an Excel spreadsheet
for a month.”
“I’m forced to project revenues out of thin air.
Putting revenue projections is a nonsensical
exercise.”
“A business case is just a lifeless PowerPoint deck.”
Loveforincludingfinancials…NOT!
“Currently, we have to fill out a Project
Engagement Request Form that asks for
numbers. But it’s all guesswork. It’s a waste.”
“Financial analysis – it’s really just pretend.”
“It means showing them a model where you lose
money in the beginning in the hopes of making
the volume later. I don’t like this approach.”
“Typically what happens is you build the business
case, and then because you can’t guarantee the
results the execs ask you to do more research.”
“You are describing
my life!”
“People inflate their numbers.”
“It took months and months to get through the
business case.”
“I need to build a horse by committee and I got a
camel.”
“Decisions are sometimes made for stupid
reasons. Especially in large organizations.”
“There’s a desire to apply existing
[corporate] structure to pursuing ideas. This
takes away the need to be scrappy. It results
in the pursuit of metrics that you want to tell
your version of the story [as opposed to the
customer’s]. The product plan, even when
approved, is often very lame, timid and only
designed to help achieve metrics sufficient to
secure bonus payouts.”

Problem #3
Managing internal stakeholders is hard
13
#1 challenge

Too many cooks in the kitchen
• Lots of opinions
• Lots of approvals
• Competing agendas
• Keeping everyone on the same page
• Capturing and addressing concerns
• Following up
• Need an executive sponsor/champion
14

Ok! So what do we do?
We need to apply lean thinking to formulating
and getting buy-in for product strategy
15

Applying lean principles to get there
1. Capture your initial product vision in a way that’s concise and
easily sharable
– Minimize documentation upfront (save trees)
– Write the business plan/case, MRD, etc. later
2. Use validated learning to test each aspect of your product
strategy
3. Identify and develop your stakeholders
4. Know how to communicate progress
16

CAPTURING YOUR PRODUCT
VISION
17

Customer Segment
For whom are we solving a
problem?
For whom are we creating
value?
Early Adopter:
Who is a potential early
user of the solution?
Problem
What are the top 3-5
problems faced by our target
Customer Segment?
Unique Value Proposition
How are we uniquely going to solve
our customer’s problems or satisfy
their needs?
A single, clear, compelling message
that states why you are different and
worth buying.
Solution
What are the top 3-5 ways
we are going to solve the
problems faced by our
Customer Segment?
Key Success
Factors
How will we measure
success?
What key metrics are we
trying to move?
Existing Alternatives
How are they solving the
problem today?
Channels
How will we get (acquire), keep
(retain) and grow (sell more to
existing) customers?
Get/Acquire: How will we drive
awareness, interest, activation,
usage?
Keep/Retain: How will we keep
customers coming back?
Grow: How will we up-sell/cross-sell
customers, encourage referrals?
Key Stakeholders
Who are the most important
stakeholders whose buy-in
we need?
Which executives do we need
to convince?
Who will be our executive
champion?
Who are the key influencers
to these stakeholders?
Who else do we need to
include in our coalition-of-
the-willing?
Key Resources &
Partners
What are the critical
internal and external
resources we need to
deliver the solution to the
customer?
Revenue/Business Value
What is the business value of delivering the product/service/capability? (E.g.,
drive revenue, save money, increase CSAT, competitive differentiator, market
positioning, etc.)
Cost Structure
What are most important costs inherent in our product model?
Which Key Resources are most expensive?
Which key activities are most expensive – product development, marketing,
customer support?
PRODUCT MARKET
MARKET/CUSTOMER PRODUCT/BUSINESS
Product Canvas
Product Canvas is adapted from The Business Model Canvas (http://www.businessmodelgeneration.com)and is licensed under the Creative Commons Attribution-ShareAlike3.0 Unported License.
To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/or send a letter to Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.

USE VALIDATED LEARNING
19

Customer Segment
Early Adopter:
Problem Unique Value Proposition Solution Key Metrics
Existing Alternatives Channels Key Stakeholders Key Resources &
Partners
Revenue/Business Value Cost Structure
PRODUCT MARKET
MARKET/CUSTOMER PRODUCT/BUSINESS
A made up example
Product Canvas is adapted from The Business Model Canvas (www.businessmodel.canvas.com)and is licensed under the Creative Commons
Attribution-ShareAlike3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/or send a letter to
CreativeCommons, 444 Castro Street, Suite 900, Mountain View, California,94041, USA.
Mortgage
customers
•Active online
servicing user
•Current chkg
acct customer
•Rewards user
•$400k+ home
purchase price
All your bills in
one place
•View all bills
(utility, etc.)
•Pay bills
through online
bank servicing
•Direct debit
from bank
account
•Earn Rewards
•Mail
•Online servicing
portal
•Social media
promotional
campaign
•Branches, tellers
•Bank BillPay
(can’t view bill,
though)
•Manilla.com
•Don’t want
paper bills
•Paying at each
service’s site is
tedious
•Some vendors
charge eCheck
processing fees
Executive
Sponsor:
Business VP/GM
VP PM
SVP Ops
VP Digital
Servicing
•Free for customers
•Customer Lifetime Value benefit
•Fee to service providers
•IT development cycles
•Marketing costs
•Integration costs
•Payment processing fees
IT capacity
Brand
Ops
Branches
Service
providers

11/1/12 Confidential 21
VALIDATED LEARNING BOARD
UNTESTED
IN PROGRESS DONE
Risk/Assumption Build Measure Learn
Who are my early
adopters?
EXPERIMENT: Landing page
test on UserTesting.com
FALSIFIABLE HYPOTHESIS:
80% of 100 participants will
validate the messaging
Does the UVP
messaging
resonate?
Can integration
with service
providers be done
cost-effectively?
Is this a problem
worth solving?
Compete with
Project Gold for
prioritization?
IT capacity
available?
Will service
providers pay for
it?
EXPERIMENT: Interviews
with 20 service providers
FALSIFIABLE
HYPOTHESIS: 80% will
validate value prop of
our service

“DEVELOP” STAKEHOLDERS
22

Stakeholder Department Role Current Priorities My Hypothesis Result Status
Name of the
Stakeholder
His or her
department
Is he or she a
Decision Maker,
Influencer,
Execution
Partner?
(Or have no
role to play?)
What are his or her
current priorities,
challenges,
opportunities?
Do I think he or she will be in
favor or opposed? Is there a fit
with one of their current or
planned initiatives?
Is there a particularly area
where they are likely to raise
an issue, such as questioning
the customer need, resource
constraints, etc.
Result of the
conversation.
Were my
hypotheses
validated or
invalidated?
Mark him or
her as a
Supporter,
Detractor or
N/A.
Stakeholder Development Tracker
The Stakeholder Development Tracker is licensed under the Creative Commons Attribution-ShareAlike 3.0 Unported License. To view a copy of
this license, visit http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 444 Castro Street, Suite 900, Mountain
View, California, 94041, USA.

COMMUNICATE PROGRESS
24

Communicate progress is critical for ongoing support
• Updated Product Canvas reflects current evolution of product
strategy
• Validated Learning Board can be shared in detail or summary to
articulate progress
– Progress can be summarized in this format:
N Untested, X In Progress, Y Validated, Z Invalidated
• Stakeholder Development Tracker can be shared with manager,
executive sponsor to communicate internal traction
– Also to raise roadblocks and ask them to play interference
• Supporting detail can always be added
– Experiment reports, market research data, detailed financial analysis, etc.
25

Benefits
 Fast
 Concise
 Portable
 Collaborative
• Easily shared
• Easily readable and understood
• Common language
• Not meant to replace a business case/plan, MRD/PRD or user stories
– But they can come later
26

Interested in applying lean principles to product innovation?
• Get your copy of the Product Canvas here:
http://streetsmartproductmanager.com/product-canvas/
• Or email me
• More information:
– Product Canvas: http://wp.me/pQmRk-7x
– Validated Learning Board: http://wp.me/pQmRk-am
– Stakeholder Development Tracker: http://wp.me/pQmRk-8l
• I also offer workshops
27
@shardulmehta http://www.linkedin.com/in/shardulmehta
http://streetsmartproductmanager.comshardulmehta@gmail.com
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