Many of our clients have been asking us for advice on how to stay competitive in this rapidly changing world. Customer behavior is changing rapidly and, if they are financially healthy, your competitors are likely innovating to adapt to these changes. Other competitors may be struggling and could become acquisition targets for you to bring on new assets or new customers or both. How do we stay on top of all this?
Enter: Lean competitive analysis
Just like lean startup or lean product methods, lean competitive analysis is designed to help you quickly monitor and analyze competitor actions. It is not the type of competitive analysis you would do if you were refreshing a three-year strategic plan, nor is it what we see a lot of companies doing right now, which is no competitor analysis.
I’m still surprised how many companies run down the innovation path without a quick hygiene check on the competitive landscape. A CEO gets excited about a new idea or your sales team comes to you promising that people will buy. Boom! You are off and running, only to watch the product flounder in the market after months of long days and heartache.
What is ‘typical’ competitive analysis?
Typical competitive analysis is about developing a rich understanding of who is doing what in your market space. It answers questions such as:
In lean competitor analysis, we narrow this question list based on your end goal. What are you trying to learn? Or in Vecteris terms, where are you on the Innovation Pathway?
Where are you on the Innovation Pathway?
Are you in the discover and scope stage before building a new product? If so, focus on competitors serving your target market. This means traditional competitors as well as brand new ones who are serving the same customers and addressing the same problems but with completely different solutions. A lot of ‘digital-only’ companies may emerge on your competitor scan.
Ask are they efficiently solving your customers' most unique and expensive problems? Where is the "white space" — real customer problems that aren't being addressed by your competitors?
For example, recently, a client in the healthcare industry engaged our support for the first phase of the Innovation Pathway (Discover & Scope). Their executive team was considering a large investment in a new product and wanted us to do a deep dive on new digital-only entrants, not their typical competitors. They needed to understand how well these new entrants were solving the same customer problem and how much was start-up hype. Our competitive analysis gave the board the confidence to take the next step to build a Minimum Viable Product.
In the Launch phase, we focus competitor analysis on pricing, positioning, packaging, and promotion (our version of the 4Ps). For another client in this phase of the Innovation Pathway we used competitive analysis to create a sales enablement toolkit including a pitch deck that clearly differentiated them from competitors and a sales “cheat sheet” on how to differentiate their offering versus specific competitors. These tools gave the sales team greater confidence in the product.
How to do lean competitive analysis well
The first step is to identify all the players. You may know some of the traditional competitor names. Resources like CB Insights, Owler, and Capterra (for tech products) can help you identify others. Advisors, investors, and a few customer interviews are also great sources for competitive information. Start with an exhaustive list of everyone in the space, but then do a quick competitive scan to cut the list down to just a handful of the companies that seem to compete with you the most.
Next, take a deep dive into the shortlist. Secondary sources are suitable for a first dive into the tangible and intangible assets, capabilities, níche, and current market positions. You can check advertising, sales brochures, news coverage (mainstream and business press), annual reports, trade associations, or one of the many business databases with paid walls (such as Hoovers).
Social media and company websites also reveal a lot about brand identity and marketing strategies. You can go so far as to sign up for competitors’ newsletters or subscribe to their blog.
Once the data is collected, you have to analyze it and compare it to your own. There are many ways this can be done. You could conduct a SWOT Analysis to evaluate their strengths, weaknesses, opportunities, and threats. Whatever your approach, be sure to run your own business or idea through the same method you used to assess your competitors (i.e., take an objective look at your structure, sales, and marketing efforts, etc., using the same metrics).
We recommend that you continue to monitor your competitors through the rest of your journey through the Innovation Pathway. Refresh the analysis quarterly. Consider tracking metrics that speak to:
What strategies have you used for lean competitive analysis? What worked well to get you the information you needed? If you have questions about how to structure your next competitive analysis, don't hesitate to reach out.
Digital transformation is coming at lightning speed. Previously in-person services are being offered virtually. New digital products are coming to the market quickly. The way we do business is forever changing.
For example, our video platforms and remote work tools have been a beacon of light while working remotely during the coronavirus. They've offered us a chance to see familiar faces, whether those are casual social interactions or facilitated business conversations. These virtual moments keep our days feeling unique and less isolating.
While accelerating the digital transformation of products and services, it is important to remember that our sales strategy may need to change. Even if we have identified a great consumer need and developed a great product or solution to meet that need, we won't be successful if we haven’t taught our sales teams how to sell a new digital product.
No matter how fast we are moving, there are some tried and true tactics for preparing sales teams to pivot, adapt to a new product, and deliver results:
Make sure they know what they are selling. That sounds ridiculously obvious. But, when we quickly develop and launch a new product it’s easy to forget to slow down long enough to explain it to other people. Introducing the sales team to the new product and sales process is important to building trust among the sales team, and for giving them the knowledge they need to sell it.
Salespeople need to understand the “why” of this product. What problem is it solving? What is the true market for it? They must feel good about who will buy the product and how much the customer will pay for it.
And, let’s not forget that the sales team is closest to the voice of the customer and will often have opinions about the success of the product before making their first pitch.
Ask for their feedback along the way. The pace of development might be lightning-fast, but the sooner we engage the sales team, the better. It’s a way to get valuable insights into marketability and likely customer reactions, but it will also make them feel more invested in the product and more equipped to sell it.
Spend time and money on marketing collateral. We are typically thinking of the client when we develop marketing collateral and often forget that marketing collateral also gives our sales team the confidence that we’ve invested in all levels of the product launch. So, don’t skip this step no matter how quickly the product is moving.
Build a selling toolbox. In addition to the marketing collateral, we also need to give our salespeople an arsenal of tools to make their job easy. This includes things like a 30-second elevator pitch, a sales deck, a checklist, and anything else that someone learning about the new product needs to know or that you want them to know.
Incentivize, incentivize, incentivize. Last but not least, this isn’t the time to make our sales teams feel financially insecure. It is important to make sure the sales compensation model matches the new product type to get the sales team focused on where you need them.
Just like everything else when it comes to products, iterate! Evaluate the product, marketing tools, sales pitch, etc. with the team. What’s working? What needs to be revised? What additional research is needed? Keep the conversations flowing to and from the sales team.
We’d love to hear what you are doing to engage your sales team. Or if you are in sales, what’s working in your organization as it digitally transforms? To help, Vecteris is offering a limited number of free coaching sessions for leaders to advise on your product launch plan and how to set up your sales team for success. Reach out if you are interested in learning more.
The innovation I see right now truly is awe-inspiring. For example, distilleries making hand sanitizer, software companies reconfiguring software to help hospitals track and manage COVID-19 cases, massive in-person conferences going virtual, and restaurants turning into community kitchens to serve the needy. For all of the anxiety caused by the current health crisis, there is also a lot of creativity and innovation for doing good and keeping businesses afloat.
It’s interesting how a crisis – characterized by uncertainty and constraints – sparks so much innovation. When times are good, we often forget the proverb, “necessity is the mother of invention”. We mistakenly believe that more resources (time, money, talent) will help us innovate. But my current newsfeed, my client work, and the research all show that innovation can flourish in times like these.
For example, a meta-analysis published at the end of 2019 found that constraints help, rather than hinder, innovation. Oguz Acar, Murat Tarakci, and Daan van Knippenberg reviewed 145 empirical studies on the effects of constraints on creativity and innovation and found that individuals, teams, and organizations alike benefit from a healthy dose of constraints. In other words, the limits of time, money, and available materials that many of us are dealing with in the wake of COVID-19 should help us be more innovative.
As I’ve watched clients completely re-work their product roadmaps during the last three weeks, here are a few things I’ve observed about how to innovate well in a crisis:
1. Adjust Our Mindset
Innovating in a crisis requires shifting our mindset so we are not held back by fear. It is natural to have fear when there is massive uncertainty, revenue declines, and volatility. But fear is where innovation dies.
The good news is that there are specific behaviors that help us face, and move through, our fears. What I’ve observed, and personally experienced, is that we are better able to overcome our natural fears about the unknown when we do these four things:
2. Talk Directly to Customers
Innovation starts with identifying an urgent and expensive customer problem. There are many tools we can typically use to identify customer needs (surveys, focus groups, etc.). But our best tool right now is to directly talk to customers and end-users.
Speaking directly with customers is the fastest way to understand the challenges they are facing and what they need to address those challenges. People want to hear human voices now, too. I especially caution against email surveys, landing page or email testing right now because things are so chaotic that it might get lost in the noise. Instead, let’s use this time to talk to customers while also building connections.
3. Follow Your Process, Quickly
Just because we are in crisis does not mean we throw out good product innovation hygiene. We still need to validate the consumer need, test, and learn. We just massively fast cycle the process. Two-week sprints become one-week sprints (or less). The Director of the FDA recently spoke at a press conference where he said, “Innovation that normally takes years is being pushed to a month.” That doesn’t mean they are throwing due diligence out the door. They are just accelerating that diligence.
4. Build Flexibly
Once we start building a new product, the architecture should be as flexible as possible because things are shifting rapidly. For example, use a more modular architecture, place a premium on flexibility when making design decisions, and delay hard-coded decisions until products are tested.
I’d love to hear how your organizations are innovating despite having constraints and uncertainty– share some inspiration, please!
Some call it a Minimum Viable Product or MVP. Others call it a “Minimum Desirable Product” (MDP) or even “Simple, Complete and Lovable” product (SCLP). Whatever vernacular you choose, launching your Minimum Viable Product (MVP) is about more than just getting to market. The MVP is a version of your product (or your product idea) with the right balance of features to satisfy early customers and provide learning. An MVP is not a smaller, cheaper version of your final product. It allows you to test your product in real life with real people in order to validate the product’s core value. MVP tests are designed to answer technical questions about the product, prove or disprove hypotheses, and get a real feel for the viability of the product in the market.
An MVP can help you avoid costly mistakes. Take Smith & Wesson's mountain bike flop in 2002. When you think of Smith & Wesson, images of bikes aren't likely to pop into your head, unless you are a police officer. Smith & Wesson has been making mountain bikes for police officers for decades. Given the success there, they decided to release a mountain bike for the general public. But the general public wasn't having it. The bikes were priced too high and diverged too far from what people expected to see from the Smith & Wesson brand. Good MVP testing would have either killed the project early or helped the company find a way into the consumer biking market that people would accept.
We draw from three proven methods to test our client’s MVPs (or MDP or SCLP, or whatever you want to call them).
Sell-then-build is aptly named. First, you sell the product concept. Then, you build the actual product. We like sell-then-build approaches that use a “landing page,” directing potential customers through advertising and email marketing. That landing page is a marketing tool that allows for testing the product against market expectations and demand.
This is the idea behind Kickstarter, which we’re all likely familiar with by now. It’s a platform for sell-then-build products for creative types. The designs range from world-changing to downright wacky. One woman raised over $1400, three times her goal, to create 100 little birds out of wire and felt. Who knew that there was a market for wire and felt birds? This woman does, and she learned it without first spending a dime on wire or felt.
You don’t need to use an official sell-then-build platform, like Kickstarter, to test your MVP. A landing page on your company website will do. The landing page needs to explain the product’s features and the problem it will solve for customers. Depending on the product, the landing page can get people to pay in advance or be added to a waitlist that ensures they are among the products first buyers.
To be clear, this isn't an email grab. You want to gather feedback from page visitors and measure genuine demand for the product. This usually comes in the form of people signing up for your waitlist or giving you money in advance. You can also collect feedback from a short survey about their interest in the product and the features they'd like to see. [Read more about Getting More Juice out of the Your Voice of the Customer Interviews]
Wizard of Oz Prototyping
Toto was the real hero of the Wizard of Oz when he pulled back the curtain to reveal that the giant talking wizard head was just a sweet old man appearing all-powerful. The wizard wasn't trying to pull off a nefarious deception. His intentions were good; he just didn't have the skills yet to be good at his job. Wizard of Oz prototyping is similar in that it gives the impression that a product idea is an existing product when in actuality, it's under development. There is work being done in the background, but customers don't know it’s happening.
Wizard of Oz prototyping isn’t nefarious deception either; it’s a simulation of what the real product could look like and do. It's merely a way to avoid building expensive systems or platforms until you know there is a real demand for a product or solution. And since testing is performed manually, you can quickly modify the product to rapidly test many hypotheses in search of the most effective product.
Zappos was started using Wizard of Oz prototyping. Nick Swinmurn came up with the idea of selling shoes online when he struggled to find a pair of boots he wanted. He was at a shoe store in the mall when the idea struck him. In an interview with Fortune, Nick says he approached the store and said, "I’ll take some pictures, put your shoes online, and if people buy them, I’ll buy them from you at full price.” So, that’s what he did. He set up an online store. When people ordered shoes, he’d go to the store, buy the shoes and ship them to the customer. He was the man behind the curtain until he no longer needed to be. Now, you can hop onto Zappos.com to have any shoe you might ever want sent to your house in two days.
The Concierge Test is similar to Wizard of Oz prototyping in that the work is still being done, but, in this case, your customers know it’s happening. Concierge testing lets you try out your product idea by first providing it to a small group in beta form.
A commonly shared example of good concierge testing is the sister-team behind Rent the Runway. If you aren't familiar, Rent the Runway is an online platform enabling people to borrow designer clothing and jewelry at a fraction of the cost. The sisters behind the now $100 million company started with two beta tests. The first test offered college students a chance to come in and try on clothes to rent and return. It was a success. So, they moved to the second test which allowed women to see the clothes, without the ability to try them on. Women still rented and returned the clothes. With two successful betas under their belts, the sisters knew they had an idea that was ready for scale.
This is a very high touch form of testing, as you manually work out what the product will be, and how customers engage with it. While it is intensive, concierge testing gives rich insight into your customers’ needs and desires because you are right there with them. Eventually, you can scale up the product and remove some, or all, of the human touch.
Regardless of the testing method you choose, the goal is to see how real customers engage authentically. Testing allows you to pivot your initial idea quickly and easily, if you learn that customers need or want something different, don’t let your product be the next Smith & Wesson Bike.
Have you used one of these MVP approaches or something else entirely? We would love to hear about it. Contact us.
Not sure about what MVP approach is best for your company? We can help.
I traveled to DC for business earlier this week. Not wanting to take irresponsible risks with COVID-19 (or the flu), I took hand sanitizer and a bag of Clorox wipes. I want to be responsible and try to stay healthy.
But as an entrepreneur, a mom, and a business advisor, I know I need to do more than just keep myself healthy. I need to lead my team, offer advice to clients and make sure my family is safe.
I've been asking business leaders whose opinions I value what they are doing to lead in this time of uncertainty. I am by no means an expert in crisis management, but I wanted to share the best advice I've received and how I am applying it:
1) Get comfortable with the facts
When the future is uncertain, start by understanding the facts. And please make sure your facts come from reputable sources.
The next step is to outline the best-, medium-, and worst-case scenarios in your big areas of uncertainty. So, for our businesses, this means running scenarios for revenue and cash dips, supply chain disruptions, and long periods of remote working. If you don’t know where to start, check out this McKinsey report published on Monday for inspiration. It outlines best-, medium-, and worst-case scenarios for big companies and also has actionable advice for each.
The team at Vecteris is fully distributed (i.e., remote), so my business scenarios have focused on revenue and cash flow. For each scenario, I wrote down the actions we could take to stay strong. Yes, things are continuing to evolve, but the act of imagining the worst-possible scenario and writing down how we might respond was incredibly comforting. I also suggest thinking through best-, medium-, and worst-case scenarios on how might the kids staying home for weeks or months impact you? What happens if travel restrictions continue? How could you manage each scenario?
The point is not to deny the facts or their seriousness. Scenario planning is both coming to terms with the facts and, more likely than not, discovering that the scenarios can be managed. Every situation, even the worst case, can be figured out, and a plan can be put in place. Or, in the words of Marie Forleo, “Everything is figure outable.”
2) Reframe the situation
In each of the scenarios (best-, medium- and even worse-case), there is always an abundance of opportunity. It could be everything from using the dip in the market to invest (I just noticed one friend fishing for small M&A targets on LinkedIn - seriously), to the opportunity to tackle long-delayed projects at home.
It is also an excellent time to shed things in your life or business that are not working. For some companies, that could be pruning the product portfolio, accelerating investment in new products or making overdue organizational changes.
It is also a great time to build new capabilities. Personally, that could be taking online courses or starting to tackle that pile of books you want to read. From a business standpoint, what could my team do with free time if business slows? I get excited thinking about having the time to create a new workshop offering, create new content, strengthen our prospect list, and the list of ideas goes on.
Life isn’t about waiting for the storm to pass…
It’s about learning to dance in the rain. – Anonymous
3) Be of Service
Being of service to others almost always helps me forget my own concerns. For example, how can I be of better service to my customers? The McKinsey report I referenced earlier has good advice about “getting closer to your customers” to find out what help customers need during this time of uncertainty rather than taking wild guesses.
Even better, be of service to those who are truly suffering. How can we help hourly workers or people who work in travel and hospitality? Or Uber and Lyft drivers? What about the homeless? Or the elderly? Some people will struggle with the community-wide isolation - what can we do to help them?
Consider dropping off needed supplies at a local homeless shelter (call first and ask what they need). Phone an elderly neighbor or relative to find out what they need. Be extra generous with tips. This is a drop in the bucket, I know, but it will help you contextualize your own situation.
With all the media coverage and social media frenzy, it's easy to start to panic and feel overwhelmed by the potential fallout. But there are things you can do to keep yourself, your family, and your business safe. I know I am feeling more prepared and ready for whatever the next few weeks or months have in store.
I would love to know what information sources you are finding useful and the steps you are taking. Please share!
“What’s the biggest new product development mistake you see companies make?” a client recently asked me.
I immediately said, “Creating something that does not solve an urgent and expensive customer problem.”
It’s true. Sometimes it happens when we fall in love with a new technology, jump to developing a product that leverages the technology and then end up creating a “solution in search of a problem.”
Other times, we might develop a new product to copy a competitor without pausing to ask if the competitor is successfully meeting an urgent and expensive customer problem.
Or, maybe, our product team thinks they have identified an urgent and expensive customer problem. But it’s really only a frequently cited problem. Or it is a symptom, not the root cause, of the problem.
In all of these cases, we waste money developing and launching new products that customers won't buy.
Here are a few tips for avoiding this mistake.
1. Appreciate the difference between frequently cited problems and expensive and urgent problems.
Clayton Christensen’s advice to design products that solve customers’ “jobs-to-be-done” is frequently cited among product innovation professionals. He suggests looking for “…poorly performed ‘jobs’ in customers’ lives-and then design[ing] products, experiences, and processes around those jobs.”
However, we think finding a “job-to-be-done” is not enough. We encourage our clients to find an urgent and expensive job-to-be-done to solve. We need to understand the difference between a minor annoyance or a real pain point. The difference between something that will "improve people's moods but not their lives.”
For example, we recently conducted Voice of the Customer interviews for a client. Many of the customers we spoke with cited feeling lonely while on out-of-town work assignments as a problem they faced. However, as we dug deeper, we realized that this problem was not as painful as other problems, such as job assignment uncertainty or better temporary housing options. We recommended focusing innovation efforts on solving those problems first and think about addressing loneliness later.
Cindy Alvarez, author of Lean Customer Development, has some great tips for asking the right questions in customer interviews that can help us understand how urgent and expensive a customer problem is. Here is some of her advice that I love:
Keep in mind that urgent and expensive problems are frustrating enough that people do more than complain about them. They are prepared to do something about the issue, such as paying for a service or switching providers.
2. Don’t confuse the current solution with the problem.
Consider this oft-cited example from Harvard Business School marketing professor Theodore Levitt: A potential customer needs a hole in their wall to hang a painting. The current solution to that problem is a drill. We might be tempted to create a better drill. But, if we take a step back to reconsider the problem, which is: “I need a hole in my wall,” we could design an entirely new way to create better holes in walls. As Levitt said, put it, "People don't want to buy a quarter-inch drill. They want a quarter-inch hole!"
Mobility, getting from point A to point B, is similar. When cars were invented, people stopped buying horses and buggies. It no longer mattered how fast the horse or how good the buggy, people wanted cars instead. The customer problem was mobility, not slow horses. Car companies are facing a similar market distribution felt by the horse and buggy companies. The urgent and expensive problem that cars solve is getting from point A to point B. Enter Uber and Lyft, who innovatively solve that problem.
One way to do this is to understand the root cause of the problem. To uncover the root cause, we like the five whys method. It was developed by Japanese inventor and industrialist, Sakichi Toyoda, to provide a better understanding of any problem and uncover its solution. It’s a simple process that involves asking the question “why” enough times that you get past symptoms of a problem to the root cause.
The point is not to stay anchored to a particular solution or ‘surface-level’ problem. When we identify the underlying customer problem, it opens the door for game-changing innovation.
3. Design real-life tests for your hypotheses, don't just ask questions.
Once we’ve found a problem that seems worth solving, we need to be sure. That means developing a hypothesis and testing it. A testable hypothesis should state the problem and what we expect our solution will do. For example:
To test the hypotheses thoroughly, we need to go beyond just asking customers and run live tests. This is important because:
There are a range of techniques for market testing that are fast and thorough, such as selling a product before it exists (think: Kickstarter), or building and launching your MVP (a.k.a. send a product with as few features as possible to market). Each of these approaches allows us to see whether customers will buy your product and test different feature sets of the product that entice them to or deter them from buying.
At Vecteris, we specialize in helping B2B companies successfully design and manage innovations. Our Innovations Insights service ensures your new products address urgent and expensive customer problems. Using techniques adapted from the Design Sprint process, our service includes:
Please contact me to walk you through our different Innovation Insights offerings!
I am sure you would agree, technology has changed drastically since most of us were in school, probably, even, since most of us took the jobs we are in today. Yet, despite how true this may be, the data says we aren't doing enough to help ourselves, our employees, and our organizations adapt to these changes.
According to a recent survey by Gartner, 70% of employees report that they don’t have mastery of the skills needed to do their jobs. And 52% believe they need upskilling as a result of digitalization.
We can’t afford to let our knowledge and skills stagnate. Top performing companies know this. A survey by IBM found that 84% of employees in the best performing organizations receive the training they need, compared to just 16% in the worst-performing organizations.
Classroom-based, instructor-led training, while still valuable, cannot keep pace with today’s technology-driven training needs. Science has deepened our understanding of how people learn—and we how can leverage technology to do it.
Learning Product Services
Vecteris has launched our Learning Product Services to help our clients in the learning & development space develop the products they first came to us to create the product strategy for. Here’s a brief overview of the kind of learning product services we are recommending to our clients today.
Mobile & Social eLearning
We are tethered to our smartphones for socialization, business, and entertainment. Why not use it for education? Mobile learning solutions put learning into the hands of learners, allowing them to access the content at any time and in any place. It fulfills our expectations for on-demand services. Learning providers can offer their users “just-in-time and just-for-me” training. Think LinkedIn Learning, Coursera, or Smartly (the mobile MBA), who all provide off-the-shelf eLearning courses. Similarly, our mobile and social eLearning solutions give you the power to customize content and curriculum to meet the unmet needs of your learners.
Microlearning is also an eLearning solution, but it’s taken in tiny chunks (typically, less than 5 minutes long). If you come from a more traditional learning background that required 15-week long semesters and $400 in textbooks, you might be inclined to dismiss microlearning as the lazy way out or consider it sub-par in some way. But, a 2015 study out of Germany shows that learners who received smaller bits of content took less time to answer test questions while still performing better. Bottom line: microlearning is less time-consuming and less expensive than regular eLearning. It is also more engaging and results in higher information retention.
Instructor/Virtual Instructor-led Training
As much as eLearning has to offer, some things are better learned with a guide. That’s why we also help organizations create rich, customized content that reflects their brand within a structured curriculum. Content can be delivered in person or virtually.
Virtual instructor-led training can involve scheduled courses on video conference platforms like Zoom, or through online classrooms with pre-recorded content and discussion board. This type of training allows the instructor and learner to engage from anywhere in the world.
We are excited about this work. We’ve bought on a team of seasoned instructional design and learning product development experts who have opened up a whole world of learning opportunities.
Professional training no longer requires taking people away from work thanks to an innovative new approach — workflow-enabled learning. At the most basic level, workflow-enabled learning is a training strategy that empowers your team by incorporating “learning” into their daily “workflow” with convenient and intuitive online tools that help them address job challenges in real-time. The result is greatly expedited task completion. Tracy Cyr VP of Learning at Ariel and our CEO Eisha Tierney Armstrong's were recently featured in Training Industry Magazine. Learn about how their experience with workflow-enabled learning empowering teams to increase productivity. http://bit.ly/37g26Ds
So, how’s your organization meeting the training needs of your employees or customer-base? To help our client’s kick-off 2020 strong, we are offering a limited number of “Learn to Learn” Coaching Sessions. If you are interested in talking to one of our experts on how you can use learning to support your product development send me a quick note.
Such a small, powerful, and, sometimes, frightening word. It's a word most of us hate to hear and that we don't say enough. “No," however, can be our sanity and productivity savior in our personal and professional lives when used well.
In our businesses, “No” can free up resources to pursue longer-term growth. Requests for product customization (a.k.a. one-off-work), for example, is a significant resource drain for product development teams. In fact, reducing custom development requests is the largest challenge for companies that are migrating from customized solutions to more standardized products.
Customization is often promised by well-meaning sales or account management teams that don’t fully understand a more scalable product strategy. However, if your development team is spending all of its time on custom requests, it will never have the time to make your scalable products successful.
“Simplicity boils down to two steps:
Identify the essential. Eliminate the rest.”
– Leo Babauta, Zen Habits
That leaves a lot of CEOs asking: “What can I do to reduce the amount of customized work my product development team is doing?”
I’d argue that the smartest strategy would be to correctly identify customer needs before developing new products (read our COO’s blog about how to do this), and then deliver on what gives 80% of your customers, 80% of what they need. But even when we’ve identified the product features that meet the largest customer need, we still might find ourselves with customization requests, again, typically coming from well-meaning staff who do not embrace the new scalable product strategy.
One of our clients has solved the problem of customized development requests, and they did so in less than nine months. Here’s their story.
Case Study: Reducing Customization
After decades of success selling services that were often heavily customized, our client decided they needed to build more scalable, technology-based products to effectively compete in a changing market. They did not have new investment dollars to fund building more scalable products, so they diverted their existing product development teams away from customized work toward building the more scalable products.
The shift started, first, with the CEO and the Head of Sales, announcing the strategy change at the annual sales kick-off. Knowing that they could not flip a switch and completely stop custom work for clients, they also created a way for the sales and account management team to request an exception on behalf of a client. This came in the form of a “help desk ticket” that was first reviewed by the product team and ultimately decided upon by the Head of Sales and the CEO, if necessary.
When completing this customized work request ticket, the submitter had to outline a super simple business case:
Once our client started implementing this process, many requests that may have been fulfilled before were automatically dismissed because of a lack of a positive ROI. It’s a lot easier to assess the value of a customization when it is spelled out in front of you in black and white.
The big help, especially for sales team engagement, was that it wasn’t the product development team saying, "no,” rather it was the leadership team, including the Head of Sales, saying “no.”
Additionally, the executive team and sales leadership could turn to the salesperson and say, “go look for something more profitable.” Even if the immediate request was denied, the door was open for a viable solution.
Our client started with a goal of no more than 25% of total product development teams’ effort being spent on client custom projects. In January of this year, they were at about 40%. In the last three months, the average was about 15-20%. That is a 50% decline!
Saying "no" to clients isn't always easy, which is why putting a process together to build the case for "no" is essential. We like our client's strategy to reduce customization because it allows for thoughtful consideration of the impact on the company's scalability and revenue goals.
What other strategies have you tried to reduce custom development requests? And how successful would you say they were? What do you think of this approach?
Many of the organizations we work with are founded by visionary leaders—people who can identify important customer problems and have the creative spark to deliver a successful solution to those problems.
Visionaries can communicate their great ideas and get people excited about them. While demonstrating exceptional resilience and adaptability as market needs change, new ideas seem to magically strike! It is exciting to work for a visionary as they can bring out the best in those around them by encouraging creativity and abstract thinking. And they have a knack for inspiring others to action.
But, at some point, these unique and special abilities can start holding companies back and, even, push loyal employees away. An excellent example of a visionary leader, or perhaps a caricature, is Elon Musk. As one of his former employees said about Tesla, "it was incredible," and "I’d never work there again."[i]
I am not going to speculate as to what it’s like to work for Mr. Musk. I can share, however, what I have heard from clients are the downsides from those who work for visionaries. Scope creep and turn-on-a-dime redirection, as the leader hops from idea to idea, is a common theme. They also talk about how visionaries get bored with the details and ignore the steps it takes to bring their ideas to fruition. Some around them start to feel defeated and exhausted.
Working with a visionary doesn't have to be a Jekyll and Hyde experience. If you’re someone who craves routine and order, and the constant barrage of ideas gives you a headache, you can still have a fantastic experience with a few simple tricks.
How to Work with a Visionary
1. Share their passion, enthusiasm, and drive
First and foremost, you have to want to be on this wild ride. The energy pushed out by your visionary leader will either drain you or invigorate you. For it to do the latter, you have to believe in the vision and be committed to delivering on it by providing the structure that is missing, which brings me to tips two and three.
2. Get clear on the criteria for moving forward
As discussed earlier, visionaries are the idea people, or more pointedly, they are often the LOTS of ideas people. While each one of their ideas could be a breakthrough innovation, rapidly moving from one idea to the next is not always practical or profitable. It’s important to have clear criteria on when to move forward with an idea and when to ignore it. To do so, you need to define how to prioritize the work, and then stick to it!
At Vecteris, we use a simple prioritization tool with clients that measures new product ideas in four areas:
With a simple calculation, we prioritize the ideas and have buy-in on what is most important. And we don't waver from the results. We trust the process to keep us focused on what's best for our business, so we don't get side-tracked, bogged down, or de-energized.
3. Give actionable plans with specific steps, job responsibilities, and deliverables
People with big vision often see the goal, but the steps to get there are glazed over. They can get bored with or lost in the process. The end goal won't matter, though, if no one takes the project to completion.
Our leadership team has built an action planning process upon which we can all rely. [ii] During our weekly executive team meeting we:
We do this quickly, using the standard green, yellow, red designation. Any problems get moved to the “issue solving” section of our agenda so we can brainstorm and decide upon a solution.
Throughout the week, our CEO and any other team members add new ideas, suggestions, or problems to our weekly executive team meeting agenda. At that meeting, we take the time to discuss, prioritize, and plan as needed.
This approach has brought about a couple of great results: first, our broader team doesn't get distracted by un-vetted ideas or frustrated by continually changing plans. Second, the executive team has the accountability needed to make sure we get the most important projects done without distraction.
Last but, definitely, not least is not so much a trick or strategy as it's a reminder:
4. Be comfortable being honest
In any healthy relationship, be it personal or professional, honesty is vital. Your organization should have a culture of psychological safety so that you feel comfortable being honest, saying no, and questioning an idea without confrontation. According to Amy Edmondson, Harvard Business School researcher and award-winning author, psychological safety “is the belief that the environment is safe for interpersonal risk-taking.”[iii]
We’ve worked hard as an executive team to build this safety with each other and with our team. We know each other, and each of our team members well. Some relationships started before Vecteris, but many did not. But we've purposefully built trust that is rooted in understanding.
Without this strength of relationship and psychological safety, we'd become, or we'd surround ourselves with, ‘yes, men' and ‘yes, women' who wouldn't be capable of helping us reach our goals.
Working with a visionary can either be the most rewarding or most damaging experience (or both, as that Tesla employee found). If you are working for one now, try these tips to make the most of the experience.
If you would like a copy of our prioritization tool and/or the executive meeting agenda we to keep us on track just send me an email at email@example.com. Happy to share!
When my partners and I launched Vecteris a year ago, our primary purpose was to create a place where we love to work. We wanted to create an environment that inspires innovation, fosters collaboration, and welcomes diverse working styles and talents.
To build the culture we want, we’ve spent a lot of time this first year defining our core values and making a commitment to live them.
Five recurring themes emerged: fearless, generous, creative, committed and inclusive. The most important value for us to embrace this first year has been fearless.
Our mission is to help organizations successfully innovate. And, to successfully innovate, the leaders that we work with have to overcome their own fears of failure and change.
Also, each of the co-founders overcame fear to start Vecteris. Personally, I left a rewarding job and a secure paycheck that provided stability for my family. I had to learn new skills associated with the day-to-day operations of running a consulting business, stretching me out of my comfort zone. I started tapping my network to land our first few clients, which could have put those relationships, and my professional reputation, at risk if we failed. The list of fears I have faced this past year is very, very long.
The problem is that fear is a natural, fundamental human emotion. It is easy to say "face your fears." The hard part is learning the behaviors that help us face, and move through, our fears.
Yet, here we are, celebrating a year of facing fears:
Through my client work, my research and my personal experience, I’ve learned that the behaviors that help us successfully face our fears are different than what one might typically think.
When you picture a leader who is “fearless” what do you envision? Perhaps someone decisive, with a clear plan, hard-charging, competitive, risk-taking?
What I’ve observed, and personally experienced, is that we are better able to overcome our natural fears about the unknown when we do these four things:
Listen, Especially to Our Intuition
The most fearless clients I’ve worked with are fantastic listeners. Not only do they listen to their customers and employees, they listen to their inner voice. Often times referred to as “gut instinct” or “founder’s intuition”, these leaders have an inner voice encouraging them to take the unknown path and these leaders are following that inner voice, not ignoring it.
I’ve had a regular yoga practice for ten years and a regular meditation practice for two years. Both have helped me tap into my inner voice by quieting the chatter of my mind. Hearing, and following, my inner voice has helped me clarify my purpose, see opportunity, and ease my fears about venturing into the unknown. I firmly believe that without my practice of yoga and meditation, I never would have launched Vecteris because my fears would have been louder than the inner voice telling me to follow this path.
And the research supports this. Tibetan monks, who have mastered meditation, were found by neuroscientists to have abnormally high levels of gamma brainwaves, which are associated with our ability to synthesize disparate bits of data, solve problems, heighten perception, and boost consciousness.[i]The study found that meditation can actually rewire the brain to make better connections and generate ideas.
Other research confirms that some kind of meditative practice, such as yoga, prayer, running, even taking a nice long bath, aids the brain’s process of idea incubation which means these breaks are a key ingredient to productivity and creativity.[ii]
Ask for Help
I’ve found that fear is best overcome when we ask for help. I’ve observed that my clients who are best able to guide their organizations through fear of the unknown will often state an intention to innovate without also communicating a concrete plan to achieve their vision. Instead, they ask others to help them figure out how to make the impossible possible.
I recently had a conversation with one of my CEO clients about how best to help the senior leadership team embrace a new product innovation idea. This CEO was frustrated that the team seemed resistant to the changes the innovation would require and was wondering how to proceed. We discussed two options:
The CEO chose the first approach – having the team own the plan – and, although it took longer, it ultimately ended in a more ambitious (and successful) product.
My personal leadership journey is similar to this CEO’s. For me, asking for help meant giving up the idea that I needed to have all of the answers. As a classic ‘smarty-pants’ overachiever this has not been easy.
I’ve had to resist the urge to leap in with all of my ideas at every opportunity. I had to go back to listening (see above!) and opening my mind to others’ ideas. I’ve also had to get much more comfortable leaning into debate or discomfort and staying there. Gary Pisano wrote a great article for HBR that covers this topic. In it, he explains why healthy collaboration and comfort in debate is essential to innovation. “If people are afraid to criticize, openly challenge superiors’ views, debate the ideas of others, and raise counter-perspectives, innovation can be crushed.”[iii]
Let Go of Perfectionism
It is easier to face our fears of failure when we accept that what we do does not have to be perfect.
Getting comfortable with ‘good enough’ has been a game changer for some of my clients who are trying to innovate. Brené Brown nailed it in her book, The Gifts of Imperfection, when she said,
“Perfectionism is not the same thing as striving to be your best. Perfectionism is the belief that if we live perfect, look perfect, and act perfect, we can minimize or avoid the pain of blame, judgement, and shame.It’s a shield. It’s a twenty-ton shield that we lug around thinking it will protect us when, in fact, i t’s the thing that’s really preventing us from flight.”[iv]
For me, this has meant launching our website, publishing blogs, and even delivering work to clients without endless rounds of editing and agonizing over typos or imperfect graphics. I certainly do not want to deliver a crappy product (and we do have a few editing rounds!) but I try to model for my clients and my team that, especially when we are talking about digital innovation, we need to rapidly iterate, rather than taking months of research and development to perfect. Again, as a classic type-A, this has been a hard lesson for me to internalize.
I consciously started a regular habit of writing thank you cards and keeping a gratitude journal in 2017, around the same time I started meditating. Both the thank you notes and the journal have helped to shift my mindset to one where I see opportunity, rather than scarcity. It keeps me positively focused. I believe that mindset shift has helped me have more courage to try new things, take risks and tackle my fears.
My successful clients do something similar. They have a very strong understanding of their assets and their strengths, and they focus on building on those strengths. When generating new product ideas based on a SWOT analysis, for example, they focus on their strengths and opportunities, rather than their weaknesses and threats. This helps them talk to their teams in terms of opportunity, rather than dwelling on the obstacles.
Recent research from Gallup shows that strengths-based workplaces are more productive, too: [v] “Organizations whose mission, values and processes are based on their strengths have:
Coming from a place of strength and gratitude helps to remind ourselves, our team, and our clients of the most important fearless act of all: believing that we are powerful beyond measure. Marianne Williamson' s wisdom below is still my favorite “face my fears” touchstone:
“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness, that most frightens us. We ask ourselves, 'Who am I to be brilliant, gorgeous, talented, fabulous?' Actually, who are you not to be? . . . as we let our own light shine, we unconsciously give other people permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.”
-Marianne Williamson, A Return to Love
Understanding our customers—or more specifically their urgent and expensive problems—is the key to developing a successful product. I’ve seen too many companies waste time developing a new product that no customer wants or needs. This often happens when a CEO develops a product because they have fallen in love with an idea or a technology or are trying to out-do a competitor and they don’t want to take the time to talk to any customers about what real-life problems they are solving.
To understand those real-life problems, we need to talk to our customers directly. Feedback from a sales force is not a replacement for our own customer conversations.
Interviews can be time-consuming and a bit of a headache, if we’re being completely honest. But there is no other approach that can yield rich data with the deepest insights. And if you do them well, you don’t need to do that many.
I’ve talked to a lot of customers over the years. Here are 5 useful tips I’ve learned for doing this well – with a minimal amount of pain for you and the customer.
1. Be Clear on What You Need to Learn
We need to be sure the conversation stays on task. We can easily let open-ended questions spiral out of control or run off in a million tangents.
Then build your interview guide around those hypotheses. Your goal will be to prove or disprove each hypothesis. Review after each interview to see what you have learned and what you have left to learn. This keeps conversations headed in the right direction, to get the answers we need, without being overly prescriptive about where the conversation goes.
2. Start with the Basics
Remember, the #1 goal is to understand your customers’ most urgent and expensive problems. Use two or three broad and open-ended questions in the beginning of every customer conversation about their experience. Not only does this warm-up the conversation, it gives you the opportunity to explore the big picture. You are looking to learn:
Really explore the most pressing problems customers are facing from their point of view. Broad and open-ended questions open the door for the customer to express themselves without biasing the results (a real risk to be aware of).
3. Talk to a Representative Sample
We don’t have time to talk to everyone. So, this is where our customer personas come in. Well-developed customer personas will help us make sure we talk to the right mix of sample customers to capture a diverse mix of voices.
Keep in mind the product you plan to create – is it intended to bring in new clients? Make sure you have prospects in the mix. Could the product be received differently by very mature vs less mature customers? Will there be differences between the end-user and actual buyers?
This may sound like a daunting number of interviews, but it is really about quality over quantity. If you plan ahead to have a good mix of participants, you should be able to get the data you need from 10-12 interviews.
4. Iterate, Iterate, Iterate
This should be your mantra in all thing’s product. Pull up your notes after every interview to highlight what you have learned. Return to those questions we discussed earlier. What is the most expensive, urgent problem people are facing? Can we solve that problem? Are we creating enough value for customers to jump on board? Have you proven or disproven your hypotheses? Do you need to re-work your assumptions?
Now, ask yourself, what do you need to change in the next conversation to continue learning? Should you tweak an opening question? Should you make changes to your product vision? Can you add more specificity to your sample packaging or pricing? Don’t go more than 2-3 interviews without adjusting your interview guide.
5. Be Customer-centric
Finally, it’s imperative that we remember that we are dealing with people. People with packed schedules, to-do lists a mile long, and, basically, a million other things they could be doing instead of answering our questions. Keep the entire process focused on the customer. Work around their schedules. Thank them for giving up their time and sharing their insights.
You’ll also need to make them comfortable sharing – even when they have something to say that we might not want to hear. Be prepared for your customer to crush your vision entirely.
“Disarm “politeness” training: people are trained not to call your baby ugly. You need to make them feel safe to do this. My approach was to explain that I needed their honesty, so I didn’t build something nobody wanted to use, which seemed to resonate with folks.” –Giff Constable Chief Product Officer at Meetup
Last but not least, we need to listen more than we talk. It’s human nature to fill the gaps that make us feel awkward. We can use prompting cues like “tell me more” or “interesting, can we expand on that?” The goal is to get the customer talking again.
As we have already noted, people are busy and sometimes hard to schedule but don’t let that stop you. With hundreds of interviews under my belt, I can honestly say that 99% of people really enjoy being part of the product development process and appreciate that we value their opinions and care about their problems.
Don’t forget our team at Vecteris has decades of experience working with companies as they quickly bring products to market. Our team is highly skilled at conducting the research companies' need and providing actionable recommendations to move quickly on product ideas. Don't hesitate to reach out to see how we can help.
Product innovation and management are key capabilities for developing successful scalable, digital products. But if you're new to product innovation and management, building the processes and competencies you need to be successful can be overwhelming. For example, should you start by improving your voice of the customer skills or Agile project management skills or product usage analytics skills or all of the above?
My recent executive conversations have a common theme - speed. Specifically, they all want their teams to move faster.
For example, one client acknowledged they were still trying to figure out how to better prioritize so they could focus on executing at a pace they’ve never moved at before. They need to release products faster so they can learn from the market faster, but the team’s focus and sense of urgency is not where it needs to be.
To move faster, we need to adopt more flexible operating structures but we also need to change our standards of what ‘done’ looks like.
Earlier in my career, after returning from one of my maternity leaves, I was told that my role had expanded to that of “Product Manager.”
As a “Practice Leader,” I had strong customer voice and product development skills, but now my job was expanding to include product marketing, KPI management (including revenue targets), and long-term product strategy. I loved the expanded scope; however, although I had an MBA, I never received any formal Product Management training.
I was given an article about Product Management to read and I had to figure the role out on the fly. I made it work, but it wasn’t easy. I took a very boot-strap approach: I tacked a copy of Ben Horowtiz's Good Product Manager/Bad Product Manager  to my bulletin board, and read it every morning. And I took a leap of faith.
The companies I work with are usually B2B, knowledge-based companies (such as professional services firms) that are trying to develop new technology-enabled products—something outside their core product set. To do so requires them to think differently about how they work and how they create value for their customers.
It requires innovation.
I’ve come to learn that innovation can be tricky, and it takes hard work. It's not because the leaders are not visionary, or the team isn't creative or smart. Nor is it because the company culture is stagnating or stifling. It's because, as humans, we tend to favor the routine, the known, the comfortable. Innovation often takes us outside our comfort zones and it certainly almost always requires behavior change. So, rather than suggesting genuinely new ideas, we suggest ideas that we have seen work elsewhere. Or we turn to gimmicks that we think will make us more innovative. For example, “The right business process tool will help – let’s ditch Asana and start using Notion!” Or, even worse, we imagine that adopting open floor plans and bringing in a ping-pong table is what we need to get our teams to think more creatively.
In my experience, and the research supports this, making our companies more innovative requires 1) organizing for innovation, 2) upskilling our people, 3) adopting a disciplined process, and 4) establishing clear and aligned priorities. Here's what I’ve learned about how each of these elements can build an organization where ideas flourish and new revenue growth is possible.
“If I give this new product to my current sales team to sell, it might eat away my existing business.”
We hear this a lot.
So many executives get caught up in the fear that new products will detract, or worse destroy, their existing business. It is a legitimate concern. Total or partial cannibalization can occur when a new product moves customers away from current service offerings or product lines.
That’s why we spend a lot of time helping companies to scope, position, and launch new product innovations in a way that does not mistakenly cannibalize existing revenue streams.
We call our approach the 3 Cs of Cannibalization.
On the last day of February, Cincinnatian’s overcame freezing temperatures, grid locked traffic, and gusts of wind, hail, and snow, to attend a Women in Product Cincinnati event hosted by 84.51°, in downtown Cincinnati.
While the weather was cold, the discussions inside certainly weren’t. Moderated by Danielle Koval, we were fortunate to gain advice, wisdom, and more from Jennifer Bailey, a Director of PM at 84.51°, Lydia Henshaw, Head of Product at Alchemy, and Mike Varona, Lead Consultant of Thought Works.
Here are few of the biggest takeaways shared with PMs of at all levels that evening.
Many professional services firms have one or more of the following growth strategies:
These product-minded growth strategies are attractive.
Yesterday I had the honor of speaking with a group of local leaders about how to create more inclusive work environments (thank you, GCHRA!). We spent the morning discussing how diverse teams offer the ‘trifecta’ of great product management: more innovation, better problem solving, and greater customer empathy.
This past weekend I had the opportunity to speak at ProductCamp Cincinnati about helping more women succeed in product management roles. My recent trip to the annual Women in Product conference inspired me to start a local discussion about how to increase the number of women in product leadership roles.