Recently in my blog on Product Frameworks, I mentioned some of the common components of a product strategy. Previously I published some product strategy notes from the class I taught at Stanford in their Continuing Studies department. (Also here is a video of me discussing Platform / ISV strategy while at Salesforce.com).
Basic Strategy Model
When I taught my class, the basic strategy model was:
Basic Strategy Model
When I taught my class, the basic strategy model was:
- Where should we go? Using market analysis & competitive analysis, financial plans, and success metrics.
- Why will we be successful there? Using core competencies, mission, and competitive differentiation.
Market & competitive analysis sources include: clients, analysts, competitor websites, and other internet / published sources; and they can be utilized in one or more of a different frameworks such as (mostly from Gorchels The Product Managers Handbook)
This analysis can help you make decisions both about a specific product and about investments across a product line or portfolio.
Product Portfolio Decisions
Other frameworks that help you make your portfolio investment strategy decisions include Porter's Five Forces for Market Competitiveness
- Market Segment Analysis (percentage of company sales, percentage of industry sales, market attractiveness, size, growth rate, etc.)
- Basic Competitive Analysis (including competitive analysis via advertised positioning)
- Competitive Analysis Alternatives (direct competitors, substitutes, etc.)
This analysis can help you make decisions both about a specific product and about investments across a product line or portfolio.
Product Portfolio Decisions
Other frameworks that help you make your portfolio investment strategy decisions include Porter's Five Forces for Market Competitiveness
Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant by Kim and Mauborgne
However the trade-offs are rarely that simple as we need to consider a variety of factors:
Agile Product Strategists
As stated in the Product Frameworks blog post, with the advent of Agile methodologies another viewpoint is that product strategy activities are owned by Product Strategists (External Facing Agile Product Managers):
Lean Startup
An even more recent take on product strategy is what is prescribed for start-ups by Eric Ries in Lean Startup (Amazon, Medium, Wikipedia)
- New Product vs. Mature Product
- New Market vs. Existing Market
- Short Term vs. Long Term Revenue
- Usage vs. Revenue
- Client A vs. Client B
- Research vs. Development
- High Risk vs. Low Risk
Agile Product Strategists
As stated in the Product Frameworks blog post, with the advent of Agile methodologies another viewpoint is that product strategy activities are owned by Product Strategists (External Facing Agile Product Managers):
- Understand market needs and competitors offerings
- Talk with customers; work closely with Sales, Marketing, Services and Product Marketing
- Position product and create roadmap
- Own launches, pricing, beta programs, and product revenue
- Consider next major release and next MRD
Lean Startup
An even more recent take on product strategy is what is prescribed for start-ups by Eric Ries in Lean Startup (Amazon, Medium, Wikipedia)
In short, startups have a vision and employ a strategy to achieve their vision (business model, roadmap, product roadmap, point-of-view about partners, competitors, customers), the product is the end result of this strategy. Products are always evolving, sometimes strategies change, visions almost never change.
(from LightCastle Partners)
An MVP for a proposed solution or product should be quickly defined and then actionable (not vanity) metrics should be used to quickly iterate and incrementally improve a product for a better product market fit (Build-Measure-Learn feedback loop). The two most important assumptions are the value hypothesis and the growth hypothesis. Your MVP will have to be geared towards early adopters who understand the kinks haven’t been completely worked out for your innovative product.
An MVP for a proposed solution or product should be quickly defined and then actionable (not vanity) metrics should be used to quickly iterate and incrementally improve a product for a better product market fit (Build-Measure-Learn feedback loop). The two most important assumptions are the value hypothesis and the growth hypothesis. Your MVP will have to be geared towards early adopters who understand the kinks haven’t been completely worked out for your innovative product.