And why that strategy needs to evolve as your product grows
At Rangle, our product managers partner with our clients to build customer experience-enhancing products, without direct ownership of the products themselves. This creates a natural tension between our drive as product managers to build the most valuable thing for our clients’ customers in the “best” way possible, and the boundaries we must consider while working within our clients’ business drivers, constraints, and product culture. This means we’ve built a unique perspective on how we capture and define product strategy in our work.
One of our most significant observations has been the common misconception that product strategy work is only done upfront during product discovery, and then becomes a semi-static roadmap artifact, revisited during quarterly or annual corporate strategy planning for progress updates and minor revisions. But high-performing teams and organizations revisit and adapt their product strategy in targeted, discrete ways on a continuous basis, sometimes even sprint to sprint depending on the lifecycle phase of the product. They've learned that their product strategy must balance the need to provide clear direction to product development with the need to make timely adjustments based on meaningful data and insights from experiments, customers, and the market.
To begin, let’s build a shared vocabulary on what “product strategy” means...
What is product strategy?
Every organization has subtle differences in how they define where their product “strategy” ends and the delivery tactics begin. We define product strategy as:
In short, product strategy provides a structured way to decide what problems to solve for a product, and a plan for how to go about solving them.
A powerful example comes from Gibson Biddle, product leader and former VP of Product at Netflix, who employed his DHM (Delight, Hard to Copy, and Margin-enhancing) product strategy framework while guiding Netflix’s product transition into digital streaming in the late-2000s.
One of the strategic problems they faced at the time was how to improve the personalization of movie recommendations to customers. They knew to focus on this problem area because a strong personalization feature set would be hard to copy by competitors at the time—aligning with one of the three cornerstones of their product strategy. With a product strategy in place, they were able to:
- Break down the “personalization” problem into specific components (e.g. explicit data, matching algorithms, etc.);
- Formulate measures of success that would allow teams to know if their work made a difference;
- Design and choose experiments of new feature ideas that were aligned to these measures (e.g. UX and UI changes to encourage customers to increase the number of provided movie ratings in their first 6 weeks); and
- Shape a rolling roadmap that communicated the priority of these experiments and development efforts.
The product strategy framework allowed Biddle and his teams to repeat this for other strategic problems, designing and executing on product development plans that ensured alignment throughout by:
- Deciding on the priority strategic themes
- Formulating indicators and metrics to understand progress against these themes
- Choosing which feature experiments to develop based on potential impact on these metrics
- Knowing what to say no to
- Having objective foundations to assess experiment results for go/no-go decisions
Why do you need a product strategy?
Without a product strategy, it is incredibly easy for product development efforts to miss the mark on the desired outcomes of clients and their customers. By setting a product strategy, we determine the direction of our product efforts through a system of a product vision, goals, and desired and measurable outcomes that drive (and require) alignment between all teams and stakeholders involved.
This also increases the odds that what we build aligns to our client’s organizational strategy and their product ecosystem (if one exists), while working within organizational constraints to deliver the best possible value to our client’s customers.
This is not to say that a strong product strategy focus will always mean achieving all desired outcomes. But instilling strong product strategy mindsets among all teams involved, enabled by the use of frameworks and tools, increases the odds of successful product outcomes. Product strategy allows product teams to focus on specific problem spaces, customer segments, and feature sets, instead of trying to be everything to everyone. The power lies in both what is defined and what is excluded. For instance, by specifying a particular market in a product strategy, we are also excluding other markets. This helps both stakeholders and product teams to better understand work that is beyond the scope of the current product strategy and what would ultimately distract from the strategic goals.
Keeping product strategy relevant (and adaptable) through the product lifecycle
Another common misconception is that a mature product doesn’t need a continuously adapting product strategy because it is already established in the market. But a relevant product strategy is necessary to drive focused delivery throughout the entire product lifecycle. Without continual updates to the product strategy (regardless of lifecycle phase), you run the very real risks of product dilution, falling short on promised value, and/or deviating from the core value propositions. That said, the function of product strategy and its activities will change though throughout the lifecycle.
While it would take more than one article to elaborate on each product lifecycle phase and how product strategy is relevant in each one, we’ve summarized this information with the following (click to expand):
*New Product Development: Focused on creating customer-facing digital products, platforms, or services that convey value to the end user, and generate revenue through acquisition, retention, and/or conversion. There is greater emphasis on customer research and experience design.
**Complex Product Engineering: Focused on enhancing the enterprise architecture or integrating new digital products into broader digital ecosystems in order to meet the future needs of the business, such as reducing time-to-market.
How does Rangle capture product strategy?
As a product transformation consultancy, the nature of our product management engagements vary widely by scope, industry, product maturity, and the client’s understanding of what “good” and “great” product management can look like. So we treat client stakeholders the same way we treat customers of a product. This allows us to apply a product mindset anchored in the question “What are the stakeholders’ problems, and how can we solve them?”
This is the first step in co-creating product strategy with stakeholders (regardless of whether your stakeholders are external clients or your internal leadership). By empathising with them, it becomes clear that the many stakeholder demands or feature requests (which we know happens all the time) usually come from assumptions held by the stakeholders. These assumptions are often based on what they think will help them solve their problems.
So to effectively co-create product strategy, we help our clients understand that defining strategy actually helps them achieve their goals. One way we try to achieve this is to approach every stakeholder meeting with the intent to learn more about the business and customer problems they are currently trying to solve, not to seek their feature requests and demands. This approach continues even during delivery, where we provide status updates on what the product team is currently learning and the goals we’re working towards, instead of communicating only project management details like status updates on release dates and features shipped.
Experience has also taught us that product strategy is not developed in a vacuum. While a core responsibility of product managers is to lead and facilitate product strategy work, it requires real cross-functional collaboration in order to build a comprehensive strategy to reduce the major risk of product development going off-course.
Working in this way also serves to:
- Build a shared understanding of the product strategy among product team members, infusing a product strategy lens when team members think about how to complete their craft-specific tasks
- Build a shared understanding of balancing what’s right for the customers and for the business
- Ensure the technology strategy is aligned with the product strategy and desired business outcomes
- Ensure the metrics strategy is aligned with the product strategy and vision
- Encourage designs that are cohesive with the product strategy’s direction and priorities
- Reduce the product manager’s own biases
- Reduce the likelihood that the product manager develops tunnel vision in focus
A few examples of how we put this into practice include:
- Planning product strategy workshops and activities with the creative and technology leads (if the entire product team is not available)
- Actively encouraging all product team members to critique product strategy
- Being explicit in our rationale for significant product strategy decisions with all team members when these moments arise
As you can imagine, we’re just scratching the surface on the topic of product strategy. And if you’re wondering how to capture it for your product’s specific context, we have a series of upcoming articles where we’ll drill deeper into defining product strategy at each lifecycle phase. The first of the series looks into product strategy during the pivotal Product-Market Fit phase.