This is the first post in a series about a product manager’s perspective on the phases of new product development: idea to product, product to first customer, and first customer to a customer base. I’ll discuss my personal perspective gathered from successes and scars earned at startups and more established companies where I’ve had the opportunity to build and launch multiple enterprise applications in various domains including ERP for process manufacturing, e-sourcing, retail optimization, and sales analytics and intelligence starting with just an idea.
This post will discuss what I’ve learned about translating a hypothesis into an initial product as part of a “startup”. A startup can be a few people working out of the founder’s studio apartment or it can be a group working within an established company looking to extend the product line.
Have you ever walked into a dark room and tried to find the light switch? You try to navigate your way across the room without tripping over the ottoman. Inevitably you walk into a wall or two. That’s what the early days of product creation feel like. In the beginning, there’s an idea, a lot of optimism, but little direction. The product manager’s job is to try to turn on some lights and bring the vision into focus so it’s tangible enough to be built, i.e. turning PowerPoint into Product.
Let’s start at the beginning – the idea. The idea doesn’t necessarily come from the product manager. At a startup it typically comes from the visionary founders who have found a problem with no market solution and some ideas about how to solve the problem. Regardless of whose idea it is, there needs to be some basic due diligence to validate that the idea has a market, i.e. there are customers who are not only interested, but willing to pay for your solution to the problem. For example, one idea that I was asked to productize was an application that would enable companies to manage the sourcing process for services like hotel and transportation. After interviewing a few potential customers I discovered that there was already another vendor in the space, but also found that there was a market for this solution for print services. Make sure you’re working on the right problem before you start building.
What is a Product Manager?
Let’s step back and discuss what a product manager is and what that role looks like in the world of a startup. If you’ve ever looked at product manager job postings they usually start with the words ‘product champion’ followed by a broad list of responsibilities from competitive analysis, go-to-market strategy, product requirements, feature prioritization, sales support, and so on. However, at the most fundamental level, a product manager is responsible for ensuring that they deliver a product that their customer wants to buy and use.
In the beginning, there’s neither a product nor a customer. It’s a chicken and egg problem. Do you build the product first and find the customer or find the customer first and then build the product? Usually, it’s a race to see who gets there first.
One strategy is to identify a beta customer that will fund the initial product. Everyone agrees that this will be a market-based solution, not a custom development project with a well-defined timeline and scope. You’ll have access to end users who can help drive the detailed requirements and the result will be a product that you can sell to other customers. On paper this partnership sounds like a win-win situation. Unfortunately, this is a risky path. One sentence in a high level statement of work can be interpreted many ways. When vision is translated down to the end user’s requirements, you find that the person you’re working with wants to replicate the process they have today, while you had a different approach in mind. You could find yourself in a sinkhole with an unhappy customer and a “product” that is custom and never ending.
A better solution is to find a company experiencing the problem and build a non-binding relationship. The company commits to giving you access to end users that you can interview, observe, and test ideas with. In return, they potentially get a market solution to their problem. If you can’t find a customer who’s willing to engage, then you should question your product idea. By working with more than one organization, you can build knowledge from multiple sources and ensure that you don’t build a one-dimensional solution. This relationship gives you the freedom to develop your product without being limited by a customer’s approach to a problem.
Alternatively, you could start with a “product”. This product is actually a test bed or proof of concept. Your goal should be to validate your approach to the problem and solidify your thinking as quickly as possible. One option is to work with a UX team to develop a working prototype of the user interface that will be thrown away. Use this to convey your vision to potential partners. A typical approach is to start with sketches and wireframes to illustrate the content and workflow for the primary use cases, which are turned into a clickable prototype. Another option is to build a custom product as part of a services engagement. This allows you to fund your research, but you don’t have the conflict of trying to deliver a customer-specific and a market solution in one project. In our initial days at Lattice Engines, the “product” exercise was an Excel macro. It wasn’t pretty, but we were able to get feedback from actual usage. Almost any format will work, but it should be visual and interactive. Use these to get feedback and refine your design, and repeat quickly and often.
Figure 1: Original Excel Macro Version of Sales Intelligence Solution
Figure 2: Current version of a view from the salesPRISM Big Data Analytics Platform
Figure 3: Original Concept of a Detail view
Figure 4: Current version of detail view
Although the look and feel is vastly different, many of the original concepts designed to help sales sell smarter are still in the current product including recommendations on which products an account is most likely to buy supported by insights about the account, and the tracking of recommendation outcomes to support a closed loop cycle.
In summary, there isn’t one path from idea to product, but there are usually has a few ottomans along the way. In the next post, we’ll look at the transition when you land your first customer. Stay tuned. Was this helpful? Please let me know what you think in the comments.