Chapter 8
IN THIS CHAPTER
Understanding basic planning guidelines
Looking at planning under Lean, Agile, and waterfall
Figuring out how much and what kind of documentation is appropriate
In this chapter, we discuss all the variables that affect how you decide to plan a new product or new addition to a product. This chapter ensures you understand the lay of the land in your specific situation and shows you why changing the way you plan to achieve better outcomes can be valuable.
The key benefit that a well-functioning product management organization can bring to a company’s success is making sure that the products developed actually deliver valuable solutions to customers and that the product is profitable for the company. The planning phase is where you do the detailed work to make sure that you are focusing the organization on a valid problem to solve and that solving this problem will actually translate into company revenue, profits, and any other goals that you’ve set for the product. Planning to plan may sound odd, but the planning process has so many variables to look at that the safe and sane way to proceed is to plan carefully.
In our experience with client after client, the most common problem with the way many companies create products is that they view the process as serial rather than parallel. In reality, as Figure 8-1 shows, product development often starts early and continues at the same time as the ongoing work of understanding how the product will best be brought to market, positioned for a market, and sold.
The most important thing about planning is to make sure that you start early. In fact, you should always start much earlier than you think you need to in order to determine both the product and the marketing parts of the product delivery equation. As you investigate an idea in the conceive phase, plan ahead to what it will take to actually get funding for a project.
Here’s an interesting phrase: “PM as a GM.” It means that a product manager should think about his work much as a general manager does. No, most product managers don’t have the scope of full financial responsibility that a real general manager does. However, the concept of a product manager acting as an executive overseeing all aspects of the plan and execution is very valid.
Products are best brought to market by an integrated team, including members from all parts of the organization. In our consulting work, where we find organizations that are struggling to reach their potential, we often hear of siloed functions that aren’t working together or communicating. Siloed functions happen when information isn’t shared between departments or where each department only looks after its own interests or charter without adjusting to other departments. The result is disjointed and inefficient transitions between internal groups who don’t see themselves as part of a cross-company team. As you get started, bring your integrated team together and share your vision. Have each member contribute to the vision so that everyone has a stake in it. This is one secret to great products: great teamwork.
Remember: Information changes. Each document you create for your project needs to have version controls so that you’re clear on what the latest version is and you can keep adapting the document. Arrange for some time each week or month to update the document that you’re developing. At some point, you may not be the product manager for this product anymore, so make sure others who follow in your footsteps can understand the changes you made and why. Table 8-1 shows a simple addition and revision history of a change. Changing the version number can also help readers easily identify whether they have the latest copy. Online documentation such as shared wikis often include planning information using change logs and allowing readers to subscribe to a document so that they receive alerts when a document is changed.
TABLE 8-1 Change-Tracking in a Living Document
Marketing Strategy Plan |
Date |
Description of Change |
Change Made By |
V 1.2 |
Mar 2017 |
Added “shipping” as additional target market with associated positioning statements |
Julie Harris |
Different products require different amounts of planning. For one project, imagine that you’re developing an app to help customers keep track of gas mileage. For a second project, imagine that you need to track all the different kinds of propulsion types and their current statuses on a manned rocket headed for Mars. In both instances, you’re checking to see how much farther you can travel. The differences in the projects — who the client is, the risks involved with the project, the overall cost of the investment — contribute to how much planning needs to happen.
Here is a list of items that would indicate that you’re going to have to do a lot more planning:
After you know what your planning scope will be, you can align your time and effort accordingly. In general, the more clearly written your material is with a compelling story driving the narrative, the less work bringing the rest of the company along will be.
The two popular methods of planning are Lean and in-depth. We further discuss both later in this chapter, but here we give a brief comparison of the two types. The term Lean has become very popular in the world of product, product management, product development, and even plain old management. At its core, the Lean method of planning is built on two core concepts:
Unlike in-depth planning methodology, where you develop extensive plans upfront and don’t expect them to change much, Lean methodologies build in learning and change as you go.
In Chapter 7, we introduce the product-market fit quadrant to determine what kind of product and problem space — defined or undefined — you’re working with during the conceive phase. In this chapter on planning, your focus is adding an additional dimension of business viability. You need to know that you have a business model that generates profits given the problem that you are solving and the product that you develop to solve the problem.
Take a close look at Figure 8-3. If you’re investigating a Type I product, where you know both what product solution you have and what problem it solves, then you have a lot less work to do in determining financial viability. The example shown is for Microsoft Word 10. If you have sold Word successfully for many years, then there is not much financial uncertainty. Recently Microsoft has moved some of its products to a subscription model, which increased financial uncertainty. The focus of the Word product manager is then to discover what impact a change in the pricing model would have on overall revenue. The product and the problem it solved remained unchanged as they had already been successfully defined.
If, on the contrary, you identify that you’re working on a Type IV product, where you’re simultaneously working on defining what the customer problem is while defining which product may solve that problem, your planning should be much more cautious and use a disciplined empirical process like the learning loop discussed earlier in the chapter. Empirical process means one that is driven by evidence.
Start with undefined factors, the product management equivalent of the medieval map label “there be dragons” for unknown territory. Tread carefully. Examine every assumption. Validate constantly, and be ready to accept that throwing it all out and starting over or switching directions (pivoting, in the Lean start-up terminology) is the right thing to do. For those factors that are defined, make sure to document them very carefully in customer-oriented language.
Only you know your company’s culture well enough to decide what level of planning is expected and necessary. Here your focus is on balance and balance can be lost as one or another department takes over the planning process. Organizations are typically driven more in one of the following directions than another as shown in Figure 8-4:
Understanding customer wants: Sales may not have really understood what the customer asked for. If you are unable to validate the request because sales rushes the product change through, you could easily develop the wrong product. Make sure you validate and clarify the needs and requests before committing resources to build anything.
One big caveat applies in sales-driven planning. Some companies serve very few customers. Virtually every product that they produce is custom. In this scenario it is best to create an underlying product platform that suits most of what customers want and proactively create a boundary above which the product is customized.
Key executives drive most organizations. They have expectations of what your work will look like, and the kind and amount of information they need before they make a decision. Consider the following list of questions about your executives as you begin planning:
When you’ve analyzed their usual behavior patterns, create a communications plan to get your point across. Tie the outcome that your product delivers to the executive goals for the company. Don’t leave any crucial parties out of the equation. Getting executive buy-in is critical.
Investment risk is all about balancing out company resources. For start-ups, the focus is getting to self-sustaining revenue, or growing and achieving market domination as quickly as possible. What many new product managers struggle to understand is how the investment process is perceived at the corporate level. For larger companies with existing products and the opportunity to develop new ones (either follow on products or completely new ones), each project is evaluated differently. Many companies divide their development budgets into two or three categories, as shown in Figure 8-5.
If you aren’t careful to prune your product line, the ongoing product support category may grow too large over time until getting funding for new products is hard. Chapter 16 gives you an idea of the best way to retire products and have more funds to develop new products.
Using a Lean approach to planning in product management means not defining all details upfront. It means accepting — and even welcoming — that change will happen and be part of the development process.
The goal in Lean thinking for product management is to decrease the time to market and project cost without sacrificing the focus on customer value. At the same time, the project has to achieve product-market fit. (See Chapter 7.) In Lean, you investigate the entire system by using a learning cycle. Here are a couple of learning models:
These models are deliberate investigations of the system you originally used to create product and deliver value. With the results of testing, you alter aspects of the system to improve the whole. If, for example, you reduce cost by delivering software faster but the code has so many bugs that fixing it increases time to market, the system isn’t optimized. You’d be better off to slow down the coding and have better-working and maintainable code at the end.
With the idea of Lean product management in mind, the next sections cover the product management aspects that need to be in place for Lean to deliver on its promise: more value for less cost and time.
Incorporating Lean into the planning process means being honest with yourself. Part of that honesty revolves around the numbers you look at. In today’s digital marketing world, you can look at any number of numbers (pun intended). With a product moving through planning, you’re developing and testing — and probably selling at some level. Track each step of the process to see, for example, how many people sign on to the service, use it, keep using it, and then pay for it. Look for the big decrease in customers moving from awareness to commitment.
In Table 8-2, 100,000 people became aware of the product; 10,000 showed interest; 1,000 evaluated the product; and 1 person committed. This decrease in customers as they move through each and every step of the sales decision process is huge and needs urgent investigation into all aspects of this product’s value proposition. By using Lean thinking, you can run a test like this one and then, in association with an Agile development team, make changes rapidly to correct the situation.
TABLE 8-2 Analysis of Sell-Through
|
Awareness |
Interest |
Evaluation |
Commitment |
Number of people |
100,000 |
10,000 |
1,000 |
1 |
Figure 8-6 is the popular business model canvas. You use it in place of a business plan when you’re working in a Lean method with high uncertainty — so not typically for known (Type I) products. As you explore ideas and want to adapt to new information, the business canvas keeps everyone in the loop as to the current thinking, which could easily change tomorrow.
The sections are of a business canvas are in the following list. Turn to Chapter 7 for details on creating business canvases:
Where do you start? With whatever part you believe to be true. You may start with the value proposition that you want to deliver with your product. You can also start with unserved customer segments that you want to target. Then keep filling in the missing parts. If the whole scheme falls apart early on due to an inconsistency or a part of the business puzzle that you can’t validate, you’ve lost only the time spent — not millions of dollars that you may have invested building a product through more traditional planning methods.
Lean incorporates the idea of checking and change as part of the process. To implement Lean, it helps to think of the axes on which you can change or pivot your offering, market, price, or communications. These axes may include the following:
Pivots are a key part of the Lean process. As such, plan to review numbers regularly (on a monthly basis is a good cadence) and decide whether a pivot may be appropriate. Then think along each of the pivot options to see which one or two may offer a change that puts you on the road to success.
If you’re proposing to spend a lot of money on developing a brand-new idea, be prepared to spend a lot of time justifying the investment. Your executives and company may need deep planning and justification, so your planning documents will likely be long and complex.
Though running an entire project from a business case using only a canvas on the wall may be nice, the reality is that the level of documentation depends on a variety of conditions:
TABLE 8-3 Comparing Documentation Levels
Documentation Level |
Content |
Type of Change or Project |
Sign-Off Requirements |
Light |
Few or no written documents. All critical issues considered in person. Summary email advised to document decision. |
Bug fix, minor user interface change. |
Informal agreement — even just an email. |
Medium |
Some or all documents written in short form. Level of detail kept as minimal as possible. |
Small-to-medium next revision of an existing product. |
Sometimes. May just have direct manager’s signature. |
Heavy |
Complete documents delivered for all phases with extensive detail. |
Large and/or new product area, solutions that cover multiple products as part of the offering. |
All stakeholders sign off and agree to all documents. |
Chapter 3 discusses documents you use throughout the entire product life cycle. We cover the details of how to think about and create the contents of each of strategic documents in more detail in Chapters 9, 10, and 11. In the planning stage, team members should complete the following strategic documents for a large scale project:
Product description: A description of the completed solution’s feature set, expected usage, and the technology and delivery requirements. Includes initial scoping of product and project costs. Product development typically creates this document, and the target audience is product management, which confirms that the document meets the customer needs as outlined in the market needs document. In some cases, quality assurance uses the document to make sure that all parts of the product are completed.
Product development is typically unhappy about having to create a product description document. They don’t want to take responsibility in case they forgot something or the project doesn’t go well because it was described incorrectly. Workarounds include selecting one engineer and, for software, one UX person to work closely with you. Have this work specifically assigned to them through the engineering organization. You can then collaborate with them on the details of the document. Another alternative is to create a version on your own, give it to one person or a small team in product development, and then change it based on what they tell you is wrong. Since this document drives the nuts and bolts of what your product will do, product managers do whatever it takes to complete this document no matter what type of development team they work with.
Because no development process is truly 100 percent Agile or 100 percent waterfall, many organizations create hybrid processes that retain the flexibility and adaptability of Agile and have the elements of early and deep thought and planning that are waterfall. In Table 8-4, you see that the hybrid method looks a lot like Agile, with Agile requirements (called epics) taking the place of large market needs and product descriptions documents. (We discuss waterfall and how it compares to Agile in Chapter 12.)
TABLE 8-4 Comparing Agile, Hybrid, and Waterfall Documents
|
Plan Phase Documents |
Agile |
Business planning/business case Product vision Prioritized high-level user stories |
Hybrid (Agile and waterfall) |
Business planning/business case Product vision In-depth epics with more direction so that other areas can be sure of achieving certain goals for customers Market needs document (in some cases) to think through the personas, pain points, and customer problems at a more in-depth scale over a longer term |
Waterfall |
Business planning/business case Market needs document Product description document Project planning |
Writing coherently and thoughtfully to clarify your own thoughts and then using the content to influence others takes time, and your time as a product manager is precious. Each page of a document that you write can easily take you an hour or two simply because as you start writing, you realize that you forgot to nail down some of the details and have to go to figure them out. Even a well-written and complete email can eat up an hour.
One recommendation is to create a very rough draft and then ask everyone’s opinion. In that way, you don’t spend a lot of time crafting a message only to find that particular issues are still not clarified.
For a detailed project, the time from start to finish for extensive planning may be two to three months as you home in on a solution that works with all internal and external stakeholders. The actual time you spend writing will be much, much shorter than that. But if you’re going to be advocating that your company spend a large amount of money developing, launching, and marketing a product, the time you take to answer critical questions upfront and build a solid plan will be well spent.