Post on 08-May-2015
description
Product Managementin the era of
Disruptive Innovation
Krishnan & Nag at SP Jain, Aug ‘12
The product manager is the product’s CEO
ProductManagementR&D
Sales (+ Marketing)Markets + Customers
Executives
The product manager is the product’s CEO
ProductManagementR&D
Sales (+ Marketing)Markets + Customers
Executives
budgets staff
targets
strategy forecastscommitmentscompetitive intelligence
segmentation, messagespricing, roadmap, demos
market feedback
product
MRD, roadmap, priorities, personas
Source: Rich Mironov
Once upon a time in Product Management land…
Product Management (‘70s-’00s)
Develop conceptGet funding
Build product Alpha / beta test
Customer Shipment
Write business plan
Build the product Test / fix Ship / fix
Planning / collateral PR / plan launch Launch / Demand gen.
Initial sales rep Build sales team / selling
Build product and offering
Alpha testMarket test
Big-BangLaunch after
3-5 years
Cautionary tale
Source: Steve Blank
1987: Iridium founded
1990: Spun out
of Motorola
1997:Launch
1998:Bankrupt
$5.2b investment15 rockets
72 satellites
1987: Iridium founded
1990: Spun out
of Motorola
1997:Launch
1998:Bankrupt
$5.2b investment15 rockets
72 satellites
Target price: $7/minTarget users: 42million
Viable price: $0.5/minActual users: 30,000
Develop conceptGet funding
Build product Alpha / beta test
Customer Shipment
Build product and offering
Alpha testMarket test
Unbridled enthusiasm
Rude awakening
False sense of security
Resettingexpectations
Predictable disaster
“Big Up Front Design”
Big-BangLaunch after
3-5 years
Disruptive change is becoming commonplace
Dramatic change of fortunes
Source: Innosight – “Creative destruction whips through Corporate America”
Source: Innosight – “Creative destruction whips through Corporate America”
Agony and Ecstasy
Launched: 2007$22b / qtr
Founded: 1975$17b / qtr
Reasons for increasing pace of disruptive change
90-95% of new ventures fail to meet projections
The old ways of Product Management aren’t working
Adaptive Product Management
Limited planning, more experimentation and exploration
Develop conceptGet funding
Build product Alpha / beta test
Customer Shipment
Build product and offering
Alpha testMarket test
BUFD
Front-end planning & design
Back-end execution
Big-BangLaunch after
3-5 years
Existing market New marketE
xist
ing
p
rod
uct
New
p
rod
uct
Highest success rate
Lowest success rate
When does BUFD work?
BUFD is unlikely to work for…
Start-up companies
New products in established companies
Major new features/markets for established products
Visionaries
Steve BlankCustomer Development
Martin FowlerAgile Methods
2 stages of Customer Development
Search Scale
Source: Steve Blank
Focus on Experimentation
Focus on Execution
Iterative model – with checkpoints
Customer
discovery
Customer
validation
Customer
creation
Business
expansion
Pivot / Course correct
Search Scale
Source: Steve Blank
Search Principle # 1: Business Model Canvas
VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES
Source: “Business Model Generation”, Osterwalder & Pigneur
iTunes market place
Search Principle #2: Minimum Viable Product
Minimum
Viable
Too-basic products no one wants
Incumbentproducts
Minimum + ViableFertile area for new
products
Source: Start-up Chronicles
• Demonstrate value• Gather feedback
If you’re building an Excel competitor, what’s the MVP?
Minimum Viable ?
Minimum Viable ?
Minimum Viable Product for Google Docs
Value prop
Learn
Ideas
Build
OfferingMeasure
Data
Minimise the total time through the
loop
Search Principle #3: Focus on exploration
How it all fits together
Agile software development
Predictive (BUFD) | Adaptive
If da Vinci was an adaptive painter…
Source: A Series of Tubes
Questions? Comments?
knataraj@thoughtworks.com nag@thoughtworks.com