Factors Highly Correlated With High Performance On Product Teams

1. Strategic Decision-Making Aptitude: Our analysis shows that organizations that develop their strategic decision-making capabilities, and have the discipline to stay the course, have a significant marketplace advantage.
2. Standup Frequency: In short, we found that standup meeting frequency matters. Organizations that regularly conduct effective standups are more likely to perform at a high level.
3. Quick Problem Recovery: All product teams experience unexpected problems. Team performance directly correlates with how quickly product teams can move past these issues.
4. User Experience’s Integration in the Product Development Process: Product teams that successfully integrate user experience professionals into the product development process are more likely to perform at a high level.

Further Analysis: Key Findings Product Managers Should Pay Attention To

When it comes to strategic decision-making aptitude few organizations tell us they do it well. In fact, only 37% of organizations even have a product strategy. Our regression analysis clearly indicates that product managers and product teams that are adept at designing, implementing and incrementally adjusting a product strategy simply perform better than their counterparts. If you and your organization are looking to trump the competition this is clearly an area worth focusing on.

On a more tactical level our regression analysis also indicates that standup frequency makes a material difference in product team performance. In fact, the more frequently well-run standup meetings are held – the more likely a product team is to be high performing. Teams that conduct effective standups daily or regularly are more likely to out-perform their peers.

All product managers and product teams encounter unforeseen problems when developing products. But our analysis shows that those who can quickly overcome unforeseen challenges outperform their peers. If your product team blinks in the face of unforeseen issues you are more likely to be at the bottom of the pack. Nimbleness matters when it comes to high performance.

Finally, product teams that successfully integrate user experience (UX) into their product development efforts are more likely to perform at a high level. Our data shows that not only does UX’s inclusion matter it also illustrates that most user experience professionals are being utilized on new (high risk/high reward) product initiatives. In fact, only a third of user experience professionals indicate that they work on incremental improvements to existing products.

So as we move forward into 2016 take a second to reflect on how effective your product team is at incorporating and responding to these regression analysis factors. The more of these key findings product managers and product teams do well the better!

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

The post Key Findings Product Managers Should Pay Attention To appeared first on Actuation Consulting.

What is a Product Vision and Why Should I Have One for My Product?

A product vision encompasses the general idea of what the product does for whom and with what high-level benefits. The vision is intended to be enduring throughout the product lifecycle. The intent is to keep product management’s efforts focused in a consistent direction over the life of the product or at least the foreseeable future.

For products that do not have an upgrade cycle, the initial value proposition will likely be its ongoing product vision. For products and services that evolve with ongoing updates and development activities, the product vision helps to maintain a common overriding theme that all future development will respect.

The product vision is not a list of features or capabilities. It describes what the product does for a specific target market in terms of benefits. Here’s an example, our product encourages healthy exercise in the home for an aging population and is gentle on the joints, fun to use, and affordable. Much can be interpreted from this vision that can be implemented through a variety of features, while also putting boundaries around it and implying what the product is not.

The vision can also put stakes in the ground relative to competition that will force the product team to constantly stay ahead of their competitors by finding ways to make their product a market leader.

The product strategy should then go on to further describe, in general terms, how to achieve this product vision.

Conclusion

A product vision is a very useful tool for ensuring that your product develops in the way you intended. While a product vision can stand on its own it should serve as the cornerstone supporting your forward-looking and aligned product strategy and tactical product roadmap. This holds true regardless of which product development methodology your product team utilizes to actualize the product vision.

The best way to summarize this point is encapsulated by a recent comment from my last post on product strategy. Their quote, and I paraphrase here, was “relying upon a product roadmap in lieu of a product vision and strategy will get you somewhere – but it will likely be not where you intended to go.” Well said!

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

Source: The Product Management and Marketing Body of Knowledge, Greg Geracie and Steven Eppinger

The post Product Vision: Why Should I Have One? appeared first on Actuation Consulting.

What Survey Respondents Told Us in 2015

As in prior years we asked global survey respondents the following question “Which of the following methodologies best describes the way your organization develops products?” Here’s what they told us this year.

43% of survey responders – by far the highest percentage – indicate that their company utilizes a Blended approach to product development that combines both Waterfall and Agile methodologies. Agile/Scrum is the second most recorded answer, representing slightly more than a fourth of responses at 25.9%. Waterfall, with 13.6% of responses, is a trailing third. Nearly as many respondents (10.6%) indicate they did not know the methodology their organization employs in the development of products. Kanban, representing just 3.2% of responses, came in last among preferred methodologies listed.

2015’s Findings Broke A Historical Trend Line

This was the very first time that we saw an ebbing of market share for Agile product development methodologies which had been on the rise since 2012. It was also the very first time we saw Waterfall gain share. Interestingly, Blended methods remained virtually unchanged and largely consistent, in terms of responses, since 2013. It will be interesting to see if this deviation from the trend is sustained in next years market research!

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

The post Product Development Methodology Utilization in 2015 appeared first on Actuation Consulting.

One of Four Key Regression Analysis Findings

This year’s regression analysis uncovered four factors that further our knowledge about what differentiates high performing product teams from the pack.

All teams experience unforeseen problems, but organizations respond to them quite differently. Almost two-thirds of product teams struggle to get past unforeseen issues. While only 35% of product teams are able to quickly rally and nimbly handle unforeseen issues, our analysis shows that it’s these product teams that consistently overachieve.

Problem recovery is an essential skill for product teams that draws from the fabric of the company’s culture, talent pool, leadership, and creative thinking. Teams that take unforeseen problems in stride produce better results.

A Closer Look at the Data

How a company’s culture prepares its employees to handle and move past inevitable, unforeseen organizational issues is vital to staying competitive. According to our survey respondents, more than a third (35.4%) of their companies are able to respond quickly to difficulties and move past them.

Nearly half of respondents (48.7%) indicate that they eventually do move past unforeseen difficulties, but that it can take time. While 13.1% of respondents admit that their companies can get hung up on unforeseen issues and struggle to get past them, only 2.8% feel their organizations are ill equipped to face unforeseen issues and can rarely move past them to get on with the job at hand.

Conclusion: How Teams Handle Unforeseen Issues Matters

Our data clearly illustrates that product teams that have an aptitude for quickly addressing unforeseen issues perform at a higher level. However, most organizations are not aware of the impact of this single regression analysis factor. Executives who manage product development teams should keep an eye on this aspect of performance as it is a statistically significant indicator of how a particular team is likely to perform now and in the future.

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

The post Unforeseen Issues: Nimbleness Matters appeared first on Actuation Consulting.

In our previous market research we have identified that effective onboarding, or the absence of a disciplined onboarding process, has a significant impact on whether a team is able to maintain momentum. So this year we decided to take a closer look at job satisfaction and the impact that turnover is actually having on product teams.

How Would You Characterize Your Job Satisfaction?

Overall, those responding to the survey are satisfied with their positions. More than 63% indicate that they are either satisfied (48.3%) or extremely satisfied (14.8%) in their work. An additional 24.6% experience some level of satisfaction with their positions. Only 12.3% responded that they are dissatisfied with their jobs, including 5.1% who are actively looking for employment in another organization.

Having established a job satisfaction baseline let’s take a closer look at the impact that turnover is actually having.

How Would You Characterize The Impact That Personnel Turnover Is Having On Delivering Products To Market?

54% of respondents believe that team turnover has had a moderate to significant impact on their team’s ability to meet commitments and deliver products on time. This percentage includes 16.3% who believe turnover has had a damaging effect on the ability to deliver a quality product on time and 37.7% who feel turnover has moderately affected the team’s ability to deliver expected results.

Conclusion

While the actual rate of turnover is relatively low the impact that turnover has on the product team is disproportionately high. 54% of product teams are experiencing moderate to significant impact to their performance even though only 5% of product team members are actively looking to exit with another 7% passively awaiting their opportunity.

It is clear that maintaining stability on the product team is additive to performance, and as we have demonstrated in earlier research, few organizations (4%) indicate that they have a disciplined way of onboarding new product team members. Sink or swim being the dominant onboarding approach.

Is your product team experiencing turnover, and if so, what has been its impact on your team’s performance?

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

The post Turnovers Impact On Product Teams appeared first on Actuation Consulting.

In fact, effectively collecting and prioritizing customer feedback requires a variety of activities that need to be appropriately led and funded. These include the actual collection of the data, centralizing these inputs, prioritizing the inputs as well as weighing their relative values. Simply collecting the voice of the customer is not enough.

We were interested in understanding how much time product managers and owners are actively investing with customers in the field. This includes directly talking with customers, conducting market research, sales support, tradeshows, etc. So we turned to product team members to better understand their perceptions.

Before we look at the response data, how much time do you believe product managers actually spend in active customer engagement? Have a number in your head? Good, now lets take a look at what product team members told us.

“How Much Time Do Product Managers Spend in the Field in Your Organization?”

Copyright 2015 Actuation Consulting. All rights reserved.

Respondents surveyed indicate that more than 40% of their product managers spend at least 15% of their time in the field and 12.5% of this group believe their product managers devote more than 30% of their time to fieldwork where they talk to customers, conduct market research, attend tradeshows and interact with others in the field. On the other hand, more than 43% of respondents – a slightly larger group – see product managers (43.3%) spending 15% or less of their time in the field, a good portion of this group (14.8%) seeing their product managers rarely leaving the building at all.

Conclusion

The data shows that the majority of product team members believe that their product managers and owners are spending  a significant amount of time in the field actively engaging with customers. Survey respondents indicate the 69% of product managers and owners spend between 1% and 30% of their time with customers. With the majority weighing in between 1% and 15% – narrowly edging out the 15% to 30% responses.

However, the picture is not as rosy as it appears! Nearly 15% of product managers do not leave the building and when we examined product manager and owner responses – we got a different answer! It turns out that product team members have a rosier view of how much time is being spent in the field than the product managers and owners do.

I will share that data in next week’s post. Stay tuned.

Advancing the Profession of Product Management
website I consulting I training I toolkits I books I blog I twitter

The post How Much Time Do Product Managers Spend In The Field? appeared first on Actuation Consulting.

In anticipation of our latest white paper’s launch in July I want to share some data on the size of core product teams. By core we mean the roles that lie at the center of a product teams activities. For instance, the product manager or owner, the engineer, a project manager or scrum master, etc. The titles vary by organization and vertical. However, definite patterns appear in the data.

Findings: Size of Core Product Teams

In companies with less than $50 M in revenue 42% of organizations have between one to four team members. Another 38% have five to nine core team members. So while smaller teams dominate it is only by a few percentage points.

When a company moves up to more than $50 M in annual revenue but less than $500 M the size of teams shows a dramatic jump with 37% of survey respondents indicating that there are between ten to thirty members on their core team! We attribute this to rapid scaling taking place inside the business and increased levels of specialization that did not exist in the preceeding stage of growth.

As one might expect when a company grows larger than $500 M the size of teams gets whittled down again. Thirty-nine percent of companies with over $500 M up to $2 B in annualized revenues state that they have five to nine core team members with ten to thirty the next most popular category with twenty-six percent of responses.

Finally, the majority of companies with over $2B in annual revenues also state their core product teams are primarily made up of five to nine team members (35%). However, ten to thirty is close behind at thirty-one percent.

In Conclusion

Companies with less than $50 M in annualized revenues have the smallest core teams as one would expect. Interestingly, but not unexpectedly, the next tier from $50 M to $499 M shows the largest team size with between ten to thirty team members being dominant. This appears to be a temporary phase brought on by rapid scaling and increased levels of specialization that tends to get sorted out as companies cross the $500 M mark in annualized revenues. Team size tends to contract to between five to nine core product team members. This five to nine number is the most consistent size of core team configuration.

How large is your core product team?

Advancing the Profession of Product Management

website I consulting I training I toolkits I books I blog I twitter

The post How Many People Are On Your Core Product Team? appeared first on Actuation Consulting.

As a product management consulting and training organization we have seen the balance tilted in every conceivable direction. From product management holding sway through the informed use of objective data to sales teams driving the process based upon their perceptions of market needs guided by first-hand customer interactions. And everything in-between.

A Personal Disclaimer

Before I wade too deeply into this subject I need to share a bit of my own personal history. I began in sales and carried “a bag” for years. I have also run a sales team. I hit my plan every year and I could have stayed on that career track forever. However, for reasons I don’t need to get into here I decided to alter my career trajectory. Now that I have framed a bit of my history let’s get back to the question at hand.

How strong of a voice should sales have in the product development process? The conclusion that I have come to, having stood on both sides of this line, is that product management needs to collect objective data from a variety of sources, including sales, and look at the information dispassionately against the needs of the market and the organization. In the majority of instances the data will point the way toward the appropriate decisions but sometimes these decisions are situational. When situational decisions arise the call needs to be made by executive stakeholders and framed, whenever possible, with a data supported recommendation from product management that balances the best interests of all parties.

Trust is a big factor. Product managers that have an effective working relationship with the sales organization often get the benefit of the doubt. Having a sales history prior to becoming a product manager also lends a modicum of credibility (if fleeting). The sales team knows you understand the pressure they are under and their pains. In sales, if you don’t perform you don’t typically last too long. Organizations are not hesitant to upgrade the talent pool. There are plenty of sales professionals around.

From the Sales Perspective

Unlike product management things in sales feel much more immediate. You are planning for calls weekly if not daily. You have monthly goals that are closely tracked and often shared publicly to spur competition which roll up to your annual target. Effective sales leaders know how to spread the sales plan and typically build their annual plan knowing that a certain number of individuals are not going to make it. So they hedge their bets by increasing the individual allocations accounting for this under-performance. You can understand why sales professionals are often insistent – they often have a lot at stake both personally and professionally.

Product managers often lament the sales people that continuously ask for “one-offs” that are outside their thoughtfully constructed plans. After all, product professionals are asked to think longer-term and to focus on aggregate market needs. At the end of the day, the short-term needs of individual sales professionals don’t always neatly align with product management’s plans.

This is where executive arbitration matters. If the requested individual enhancement makes the plan for the company at the end of the quarter or year it may make sense to deviate from the well-crafted longer-term plan. If the “one-off” doesn’t have a material impact on the business another call will have to be made.

Like all relationships in life, the product management and sales relationship needs to be built on a foundation of trust. However, our data shows only 9% of product development teams are fully aligned with their sales organizations! Most organizations are dealing with a relationship that is not fully optimized. Sales is certainly not an adversary. They are under a lot of pressure and often coddled but they have a lot to add to the product development process. On the flip side, it is important to note that one customer does not represent a market need and that the quality of information degrades each time it is exchanged.

Conclusion

So in the end, sales is an important partner in the process. One voice mind you, but one that needs to be paid attention to. Executives at the end of the day set the tone on the balance. Will it tilt in the direction of the needs of the market or the needs of individual customers? Based upon this decision, conscious or otherwise, senior leadership holds the key to the resulting culture of collaboration or conflict that results.

What has been your experience?

The post How Strong a Voice Should Sales Have in the Product Development Process? appeared first on Actuation Consulting.

List of Possible Responses

When asked about which performance metrics product managers are being held accountable to respondents have a variety of possible options to choose from. Here’s the full list…

• Topline revenue
• Profitability
• Customer satisfaction
• Market share
• Velocity or throughput metrics
• Our product managers are not held accountable to metrics (but support attainment of company goals)
• We don’t have product managers

A Single Metric Is Prioritized Consistently Across All Verticals

While we’re still in the final stages of collecting survey responses it appears that there’s one dominant metric that crosses all the verticals. The majority of survey respondents, regardless of vertical, indicate that customer satisfaction is the most dominant metric currently being used to measure product manager performance.

The data is really interesting as it becomes increasingly variable once you dig deeper into the data. Each vertical breaks down into a different set of weightings. There doesn’t appear to be a consistent pattern from one vertical to the next. When our survey closes at the end of this month we’ll be able to complete the analysis. Once complete we’ll share our findings on the weightings for each vertical.

In the meantime, we would love to hear from you. What performance metrics are product managers in your organization being held accountable to? Are your product managers being held accountable to customer satisfaction?

You can let us know by clicking this link.

The post Performance Metrics: Which Metrics Are Product Managers Held Accountable To? appeared first on Actuation Consulting.

From our perspective, we view tight integration between the product development team and marketing counterparts as a critical element of successfully bringing products to market. The more integrated the marketing team is, and more clearly delineated the roles and responsibilities are, the more likely the team is operate at a high level. This has been substantiated in our regression analysis.

A product teams relationship with the marketing team typically falls into several clearly defined categories. Survey respondents told us that their organization’s characteristically fall into one of five categories. These categories are outlined in Table 8.

A Closer Look at the Marketing and Product Development Relationship

A third of respondents characterized the relationship between the product team and marketing as a strong working partnership throughout the product development lifecycle. Additionally, 18.60% of respondents indicated that a weak working partnership exists with marketing throughout the entire product development lifecycle.

Another 18.60% of respondents revealed that while there is a relationship between the marketing and product development teams once the product is complete, there is little to no involvement or collaboration between the two teams prior to that point. 20.94% of respondents revealed that product managers are shouldering both responsibilities and nearly a tenth of respondents (8.14%) stated that product marketing has no involvement in the launch of new products.

Significantly, only one third of marketing organizations are actively engaged with product teams throughout the entire product development lifecycle. This represents a significant opportunity, and challenge, for organizations seeking to improve their performance.

Where does your team fall on this spectrum?

The post Marketers – How Strong Is Your Relationship With The Product Development Team? appeared first on Actuation Consulting.