The following post is part two of a three-part blog post series, called From the boat of product to the sea of culture, that touches on the interconnectedness of culture, product and agility. Other parts include:
A product is a vehicle that delivers value to a set of given customer needs. In simpler terms, a product or service helps an individual do something that they weren’t able to earlier, without it. When measuring the effectiveness of a product, Product Managers often look for the outcomes, the change in customer behavior, that the product has helped enable. In the image above, the ship represents the value-carrying vehicle for the customer needs lighthouse.
The sea of culture acts as the enabler for the boat of product to move toward the lighthouse of customer needs. Without the right culture – that is, values, operating principles, and behaviors – it’s hard to build a product that will effectively deliver value to the customers.
For example, you’re building a tool that allows team members to remotely collaborate online. However, you have a culture of silos in your organization where the developers only want to be responsible for coding, the testers only want to be responsible for testing, and the designers only want to be responsible for designing. This sort of culture is never going to enable valuable product creation, let alone one that is aimed to allow team members to collaborate online. In this situation, leaders can create emergent operating principles with the team.
When building tech products in complex environments, it’s generally advisable to have product teams where the team member are altogether responsible for the quality and value that each product increment delivers. This means that the developers, testers, and designers collaborate with each other to discuss different design, code, and test aspects related to the product, to tackle them upfront and make each other’s lives easier by reducing dependencies, back-and-forth, and time to market. One such emergent operating principle could be “Quality is everybody’s responsibility”, which then should encourage a behavior of collaboration between the different roles. As a result of this new behavior, the product could improve its time to market, attractiveness to customers, and overall value. The effectiveness of a product heavily relies on the values and operating principles, which the individuals who build it use.
Just as you can’t surf in the middle of the ocean for too long, or get too far across the Pacific Ocean with just a canoe, differing emergent values and operating principles are needed at different lifecycle stages of a product to enable an organization to meet customer needs. Just as product people need to check for product-market fit (PMF), there is also a need to periodically check for product-culture fit (PCF). The benefit of doing so is a more coherent culture that empowers employees and guides them toward quicker and more decentralized decision-making.
Sachin Rekhi gives examples of Silicon Valley companies with the following secondary-product cultures as part of the PCF: engineering, data, design, and sales. The initial product strategy that helps a product launch, get PMF, and grow might be more design-driven, where the product’s unique selling point (USP) and competitive advantage in a game-changing user experience (UX). Apple is a prime example of this, with how they broke into an industry consisting of established products such as Windows, Nokia, and Blackberry phones.
This design-driven secondary culture may change into more of a sales-focused secondary culture once the growth stagnates and the product’s lifecycle reaches an inflection point at the beginning of the maturity stage. There are a few ways to move the product back into the growth phase to extend the lifecycle.
You may decide to simplify your product to make it more usable, as Microsoft has done with MS Word over the years. Or, you may introduce other features into the product – think about Netflix and the introduction of Netflix Party (now Teleparty) as a Chrome extension during the COVID pandemic to make watching movies with people in other locations, a more social experience. Another way to get your product from the mature stage back into the growth stage is by expanding to new markets and customers. Product discovery practices here can be incredibly helpful in learning about new customer needs and business opportunities. Tesla, for example, initially manufactured and sold luxury electric sports cars. The profits generated from the sales of the Roadster and Model S allowed it to offer the Model 3 to the mass market as its first “affordable” car. However, moving back from the maturity to the growth stage isn’t the only tactic to extend a product’s lifecycle.
Mature products that already have a working business model for satisfied customers are called cash cows. Deciding to “milk the product” while it’s in the mature stage saves time and money that could be put towards newer products in your pipeline that can eventually replace this cash cow. To do so, you want to maximize the time spent by the product in in the mature stage and continue your product offerings to the existing customer base, that is happy to purchase the product as their needs are being met with the help of it. You may want to continue adding incremental enhancements to optimize for efficiency instead of rolling out new features and capabilities, or focusing on product discovery practices.
Depending on the strategy that you go with, there is a need to check for the PCF for the new strategy. In the first example of wanting to return to the growth phase, the company might want to reinforce values and operating principles such as “meeting potential clients to learn about their needs”, or “expanding offers to new markets”, rather than “optimize user experience”. The latter may be more relevant once the product reaches maturity. These values and principles should be observed and created in an emergent manner.
Depending on which stage of the lifecycle the product finds itself in, as well as what sort of product strategy there is for that stage, the values and principles are likely to emerge and be different compared to the previous stage in the curve.
Let’s use the same example from part 1 of this blog series of Tom, an airline employee, working the gate prior to boarding. If there’s an operating principle such as “keep families together” exists, and when Tom notices families that are split up in the seating chart, he can make the decision himself to re-assign seats and seat them together rather than calling up his manager or inputting it in the booking system and waiting for a confirmation. The result is a satisfied family, that would probably be happy to book with the airline again, and recommend the airline to others.
Checking for the PCF at each product lifecycle stage helps employees be clear about their priorities, resulting in quicker, better, and more decentralized decision-making. This, in turn, empowers your employees and results in more satisfied customers.