The Everyday Innovator Podcast for Product Managers

Rich Mironov is a legend in the world of product management. He is the founder of Product Camp, a collaborative unconference for product managers and marketers that has spread across the world. He also is the author of the book The Art of Product Management: Lessons from a Silicon Valley Innovator. Today he provides full-time and short-term product management direction to technology companies. While our discussion is in the context of software product management, much of the insights apply to product managers in any industry.   Practices and Ideas for Product Managers and Innovators Summary of questions discussed: * You coach a lot of people who are new to product management. What do you hear are the reasons people want to be product managers?  Typically three reasons or explanations are given. People becoming product managers want to make a difference in the products that are created. They also want to have influence. This influence can be from a positive or negative position. The positive position is the desire to help guide product selection and overall product strategy. A negative position is people seeking power for themselves. For people that are seeking personal power, they will likely be disappointed in their choice of product management. Further, they’re not the people others want to work with. A related reason that people get into product management is to be involved early in the product development process to help guide the creation of the right product – products that customers love. * For all of its appeal, the role of product management has challenges – what are the frustrations people encounter in the role? Many of the challenges lie outside the scope of the individual product manager. One challenge is sales teams that are given free reign to close deals by committing to new features that don’t yet exist in products. Pressure can also come from the engineering/development side if a culture of “making it perfect” exists. There are no perfect products, only ones that customers love and buy. Another issue is making too much of an investment too early in architecture. For software products, the architecture needs to be sufficient for the current product, not for some future scale that may never happen. A key challenge is not having sufficient time to talk with customers. For product managers to be effective, they need to be spending about 30% of their time externally with customers and the remaining 70% focused on internal work. Finding that 30% is a real issue for many product managers. If they’re not working closely with customers, they cannot reasonably know customers needs, emerging trends, and the direction of the market. * Organizations are creating many of these challenges. What is your advice to product managers to navigate them and increase their influence in the organization? Great sales people are masters at understanding other people, and in this sense, product managers need to be salespeople. A good tool product managers can use in understanding others is the Myers-Briggs temperament assessment. This is also related to the ability to talk with customers in a way that helps to uncover unmet problems without making assumptions or adding bias. The most important tool product managers have to overcome challenges is providing evidence from customers and evidence can only be collected if they are spending sufficient time with customers. * Organizations are also trying many approaches to being innovative. It is the current mantra – to be more innovative. Let’s discuss what is not working and is working. The number one thing that seems like wasted effort is the so-called innovation day. Employees are excused from their regular activities and responsibilities and brought together to be innovative. Making innovation a one-time activity removes innovation from reg...

The discussion with my guest is about selecting ideas to be developed into products. Many organizations encourage employees, partners, customers, and other stakeholders to provide ideas for products, but only a few companies successfully manage organizing the ideas, selecting the best one, and executing well to turn ideas into valuable products. Peter Duggan, a SVP and Head of Product Management & Development for Computershare Investor Services, has created a simple and effective 5 step process for selecting the best ideas for new products. He shared some of these concepts in a workshop at the Product Innovation Management annual conference and I am delighted to have him share the 5 steps with us. After listening, you’ll know how to help your organization become idea-selecting ninjas through 5 simple steps.   Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * Before we can select product ideas, we have to first have ideas – how are ideas generated in your organization? How we don’t generate ideas is important to describe first– we don’t run campaigns with catchy names, that imply that idea generation is a temporary activity. Instead, we solicit ideas on a regular basis from employees that are close to the front lines. We tell employees that no idea is a bad idea – the objective is to generate lots of ideas and then to select those ideas with the most value for the organization. When ideas are selected, we also ask for the employee to identify the purpose of the idea, such as generating additional revenue, saving expense, improving client satisfaction, etc. * The first element is cataloging- what is involved? Every idea is placed into an Excel spreadsheet – we like keeping the system easy and avoid using complicated software. A template is used to collect specific information about the idea, such as its purpose, potential worth to the company, etc. The list of ideas in the spreadsheet is essentially a pipeline, like a sales pipeline. As ideas move through the pipeline, actions are taken, including seeing the idea developed. * The second element – sizing – how is that accomplished? This involves noting all the assumptions made, including specifics related to the purpose of the idea. For example, if it’s a revenue-generating idea, how large is the target market, what is the potential price of the product, how large of an effort is creating the product, what are the timing considerations for getting the product to market, how complex is the project, and what other stakeholders need to be involved. * Prioritizing is the third element. What is your experience with prioritizing? A key question is what is the capability of the organization to manage change – the capacity to accomplish projects. The number of projects need to be maximized and aligned with the capabilities of the organization and the availability of required stakeholders. Consequently, the highest priority ideas need to be identified and balanced against the needs of the organization, considering the short term and the longer term objectives, and the availability of resources. * Next is selecting – the fourth element. How is selecting accomplished? The highest priority ideas are evaluated by a team. Those selected enter a flexible stage-gate development process. Ideas that enter development are managed as a portfolio, aligned to the organization’s strategy. Each idea is assigned to a product manager. The portfolio is organized by the original purpose of the idea, either (1) revenue-generating, (2) expense saving, or (3) client-satisfaction improving. Ideas that are not selected stay in the idea pipeline but are moved to a “hold” state for revaluation in the future.

Welcome to the one year anniversary of this podcast. I’m excited to review the key concepts I found most useful for product managers and innovators from the last 52 episodes. I heard Tim Ferriss do something similar on his podcast and thought it was really helpful and I think you will find it valuable for this podcast. Also, I want to share a product mastery roadmap I have been working on – a roadmap that tells you how to go from a product manager to a product master.   Before jumping in, I have some exciting news to share – thanks largely to this podcast, I was named a “Product Management Top 40 Influencer for 2015” on the Product Management Year in Review site. I’m honored and humbled to be on the list. I have had the pleasure of interviewing some of my fellow influencers. Others I have not yet interviewed but do follow, including Eric Ries, Steve Blank, and Guy Kawasaki.     Practices and Ideas for Product Managers, Developers, and Innovators   Product Mastery Roadmap™ The Product Mastery Roadmap™ shows how a product manager becomes a product master, dramatically increasing the number of right products created – those that customers want and love – while also increasing your influence in the organization. The Roadmap goes through four levels towards mastery – Competent, Proficient, Expert, and Master. The first level, gaining competence, is where most product managers need to start. At this level you learn details of ideation, product development, and evolving products once they are launched. This builds your base towards product mastery. and learn how to go from product manager to product master.   Product Management & Innovation Year In Review TEI 002: The Product Manager’s Two Most Powerful Questions: Ask “What Else” and “Why” for Understanding Users – with Industrial Designer Darshan Rane. Understand what users need and value by: * observing * asking “correct” questions – the ones that avoid assumptions * “walking in their shoes”   TEI 003: Innovation Lessons-Learned Creating StudioPress–Test Feasibility, Identify Trends, and More – with Copyblogger Product Officer Brian Gardner Test product concepts and the business model with customers before beginning development. As an example, Brian asked people if they would buy a WordPress theme before he started creating it.   TEI 005: How Relying on Aggregate Marketing Data Can Doom New Product Development – with CEO George Farkas Watch out for those who say “we know what the customer needs” – the way to know is to iterate and co-develop prototypes with customers.   TEI 007: Simple Steps for Using the Minimal Viable Product Approach to Create a Product Customers Love–with Mixergy Founder Andrew Warner Andrew shared his minimal viable product (MVP) approach he used for creating a training product. The MVP was built entirely around a set of landing pages and used the approach of getting customers first and...

Great product managers must interact with people across the organization and possess the ability to influence stakeholders at all levels, including the very top of the company. Further, they are skilled in developing rapport with customers to gain deep insights into their problems and what they value. All of this requires effective communication and learning how to communicate both effectively and efficiently is what my guest, Curtis Fletcher, and I discuss in this interview. Curtis has been a product manager at Oracle, a Customer Experience expert for several organizations, a CTO, and has served in other leadership roles. Today he coaches executives and their management teams to be more effective communicators and presenters. I met Curtis at the SCORRE conference, which is all about becoming a better speaker. He was my coach for the 3 day experience. Improving my speaking was on my personal development list this year because I want this podcast to offer you even more value, which means I need to become a better communicator. To this end, there are a number of things I have done already. Andrew Warner, founder of Mixergy, has a great course I took for interviewing people. Alex Blumberg, the creator of the StartUp podcast, formerly the producer of This American Life at NPR, held a two day interview course that I found insightful. But now it was time to work on my actual communication clarity, so off to SCORRE I went. In this interview, Curtis and I discuss three parts of a simple framework that will help focus your communications and be more effective. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * What is the purpose of SCORRE and how did it come about? Ken Davis created the SCORRE communication system and the SCORRE conference.  He is a bit of a preacher, motivational speaker, and entrepreneur, but primarily he has made his living as a comedian. He recognized that he had the ability to captivate an audience and that he could share his method to others. SCORRE was created to teach communicating with more focus and clarity. (One of my personal observations from attending the SCORRE conference was the number of attendees that recognized they were presenters who could entertain audiences but who were not effective in delivering a message their audience could remember. SCORRE teaches both how to captivate attention and communicate in a way that audiences remember your key points.) * What are the two types of presentations a person can give? All presentations or speeches can only accomplish one of two things – you’re either trying to train or trying to persuade your audience. There are no other types of presentations. When you realize your purpose is only one or the other of these, it shapes how you think about and design your presentations. The core question is what you want your audience to do – are you training them to do something or are you persuading them to take some action? * SCORRE is an acronym – what does it stand for? The details of the system are in the book titled The Secrets of Dynamic Communication (see link below). We didn’t have time to discuss all of the elements, but they are: * S = Subject * C = Central Theme * O = Objective * R = Rationale * R = Resources * E = Evaluation * A key lesson I learned from the SCORRE conference is to begin any form of communication by having a clear objective in mind. How is an objective created? When product managers are asked to speak on a topic, such as the product roadmap or the findings of market research, don’t start preparing what you want to talk about. Instead, first ask what you want the audience to do when the presentation is done. This will be centered around a verb – I want you to buy, I want you to go do, etc.

I learned what a Walt Disney Imagineer was when my kids started watching the Disney Imagineering videos about science and engineering. Imagineers are known as the dreamers, doers, and the masterminds of magic at Disney. They create what we see and experience at Disney properties. I was fortunate to speak with Joe Tankersley, who was an Imagineer for almost two decades. Today he helps organizations improve their innovation process through the power of narrative. How product managers can use narrative was the topic of his keynote speech at the Product Innovation Management conference. I caught up with him to discuss the topic further. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * You talk about two tools for helping organizations improve the development of new products and services – foresight and narrative. Let’s start with foresight – what is that? Foresight is a series of practices designed to help groups and organizations anticipate challenges and opportunities beyond their traditional time range. It is not about predicting the future but about getting a sense of likely changes. Most people start with trends scanning, but if this is all you do, you will likely miss the underlying drivers of the trends. Foresight examines the reasons why trends exist. Culture, technology, social, economic, and political drivers need to be considered. It takes an outside-in perspective by envisioning what will be happening in the world in the future and how that impacts your organization. * What is narrative and how is it related to foresight? Narrative is story and is the most effective way to explore possible futures. We use scenarios to consider the range of potential futures – the worst case, the best case, and what may occur under specific circumstances. Story gives us a way of exploring the holistic system. (Interestingly, the topic of story and innovation has come up frequently in previous interviews.) You apply foresight and narrative because you believe you have some role in creating the future. The story becomes a guide to help you think about where you want to go. * How are you using story in organizations to help them become more innovative? One approach is to examine a range of scenarios for the future and then create scenario vignettes – small stories – that are focused on a particular market segment and products. This helps us to imagine what the needs of customers will be in the future and provides the foundation for envisioning a future product. This is not necessarily about creating a product today for users in 10-15 years, but recognizing what steps need to be taken starting today to prepare for customers’ needs in 10 to 15 years.  You will never create the story you started with and used as a guide, but you will create new technologies, new capabilities, and anticipate challenges that better prepare you for the future regardless of where you actually end up. * How can a group or product manager apply the tools of foresight and narrative to improve innovation? You begin by considering what you know, which leads to an understanding of what you don’t know. This expands your horizons and thinking about potential alternative futures. Imagination is a big part of this – you have to think beyond the world that you live in. These become the stories that guide your path towards the future. Unlike traditional persona work that creates a description of the ideal customer, the narratives begin with describing the future circumstances that customers will find themselves in. Considering the future is built around asking a series of if-this-then-that questions and basing the answers on the results of reasonable research. An important element is understanding the rate of change in technology, why things change,

I’ve been highlighting aspects of Design Thinking in several episodes and I continue with this episode that considers how idea generation can be improved using design heuristics. I discussed the topic with Seda Yilmaz,  a professor in the Department of Industrial Design at Iowa State University. She earned her PhD in Design Science from the University of Michigan. Seda and three colleagues from the fields of psychology, industrial design, and engineering wrote a chapter in the Design Thinking: New Product Development Essentials book titled Boosting Creativity in Idea Generation using Design Heuristics . The discussion is about how 77 design heuristics can improve the ideation activity of Design Thinking and product development.   Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * What is a design heuristic? First, the concept of a heuristic comes from the cognitive science domain. It is a simple rule of thumb for making a judgment. They tend to be used by experts who have developed knowledge of rules of thumb and an understanding of when they can and cannot be applied based on experience. A design heuristic is a prompt that encourages exploration of a variety of ideas during product ideation (idea generation). Seda and her fellow researchers use a set of 77 design heuristics that help guide product designers and engineers in considering non-obvious solutions to customers’ problems. * How did you identify the 77 design heuristics? Three data sources were used. The first one was from an analysis of award winning products. The second was from a behavioral study of design experts and students. The third was a case study performed by an expert designer with over 40 years of experience. Each data source led to identifying design heuristics. Together the three data sources produced 130 design heuristics. After analyzing each and identifying ones that should be combined, 77 heuristics emerged. * What are some examples of design heuristics? Each of the heuristics have names and are described on cards (similar to playing cards). The prompts are intentionally simple to make them easy to learn and easy to implement. One is Designing for Specific Users. It prompts designing product functions for a specific target user. Another example is Reconfigure, which looks at changing the way product components are configured. The figures below are two additional examples, Reorient and Add to Existing Product, from the design heuristic Cards available at Design Heuristics.       * What are examples of applying design heuristics to generate ideas for new products? Rubbermaid made use of the Flatten heuristic when creating rubber storage containers that collapse like an accordion to save space when not being used and easily expand when needed. Cover or Wrap is a heuristic for improving a product, which was used by company that created a cloth covering for a teapot to keep the tea hotter longer. Nest is a heuristic often seen in containers that fit one inside another as well as in wooden Russian nesting dolls. * When it comes to the traditional activities employed in Design Thinking of empathy, definition, ideation, prototyping, and testing, where are the design heuristics most helpful?  The ideation activity is a perfect spot to use the design heuristics. They help designers consider many options to improve ideation outcomes.   Useful links: * Design Heuristics website with the “cards” containing 77 design heuristics. * Seda’s LinkedIn profile and

Several years ago I was part of a group of product management professionals and we all felt that our profession lacked a good how-to guide that product managers could use. We considered writing one ourselves but life was a little too busy for us at the time. A few years later The Product Manager’s Desk Reference was published (and now is in its second edition) and I thought this was the resource we had envisioned and we didn’t even have to write it – bonus! Instead, my guest Steven Haines wrote the book and has also written Managing Product Management, as well as The Product Manager’s Survival Guide, and just put the finishing touches on his fourth book, The New Manager’s Survival Guide. He is the founder of Sequent Learning Networks, a provider of training and organizational advisory services for mid-to-large organizations. I asked him to join me to discuss an important topic that hasn’t been discussed yet on this show, which is the business case tool. We talk about the right and wrong ways to use a business case and how this tool can improve your success and save you headaches as a product manager. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * Where did you develop your product management experience? Steve is an accidental product manager, coming from the world of financial analysis. He had the opportunity at AT&T to gain international business experience by taking on a product management role. Steve found product management to be a perfect fit for him because he looks at products as businesses and he wanted to deepen his business experience. He became part of a product management task force at AT&T. AT&T created the task force after recognizing other large multinationals’ success came from product management leadership. Product management is a core business function that integrates the other functions of the organization. To illustrate this, picture a picket fence with the vertical boards representing the traditional functions of companies (e.g., Development, Production, Marketing, Sales, etc.) and the horizontal boards representing the cross-functional role of product management. * What is a Business Case? It is one of the most helpful instruments a company can have at its disposal. Essentially, it is a justification for making an investment that allows decision-makers to say yes to good investments and no to poor investments. The complexity of a business case varies by its use. A new-to-the-company product would require a more extensive business case than would an extension to an existing product. A fledgling business case is needed when considering a new product concept. This can be a one-page opportunity statement. Questions it addresses include: what’s going on in the market, why is the investment important, and what strategic advantage does it provide the company? Business case authors should consider if it was their own money, would they invest in this product concept? Exploring these questions in the form of a fledgling business case creates collaboration within the company. Fundamentally, the business case is a decision tool to decide to move forward and make additional investment in the concept or not. * What are examples of not using a business case appropriately? When Steve is helping an organization with an audit of their product management practices and he asks to see the business case of a product, more than 90% of the time the business case is not available. They are missing an opportunity by not using the business case as a strategic instrument to help align the portfolio of products to the company strategy. Also, companies are spending insufficient efforts on market research to validate product concepts. Too often companies assume what customers want without actually validating it with them. The proper use of a business case includes a reflection of wh...

If you have wondered what it means to do innovation at a large company, you are in the right place. I had the pleasure of interviewing Linda Bernardi, IBM’s Chief Innovation Officer responsible for Cloud and the Internet of Things. She is also a startup founder & CEO, strategic advisor to large organizations, and author of the book “Provoke,” which is about the need for organizations to embrace a culture of disruption to promote innovation. I caught her literally between planes so the audio quality is a little different than normal as I called her phone, but it’s still good for listening. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * How long have you been in your Chief Innovation role? Linda has been the Chief Innovation Officer at IBM for the last year, focusing on the Internet of Things and the Cloud and looking at where these are headed in the future. Her unofficial title is Chief Disruption Officer – changing the organization for real advancement and innovation. * Give us a sense of what the role involves at IBM. The culture of the 103-year-old company has many strengths but also a strong sense of how things are traditionally done. Disruption is needed and is a natural part of growth. It is required because everything in technology is changing. IBM is thinking about change in terms of the products and services it develops as well as its culture. What is unique about IBM is its ability to solve very complex problems, and it has done so for over 100 years. Change is coming both internally and through external acquisitions. The IBM of 2015 looks very different than it did even five years ago. * How are you being a disruptor at IBM? There are two components to that: culture and technology. Culture involves being able to think differently. The culture is changing from one that is selling IT products and services to one that is helping customers transform themselves. For those that have been at IBM, this can be an uncomfortable transition, while for the new hires who are not tied to the traditional ways of doing business, it is easy to adopt. The same is true for any change, such as switching hands you hold a toothbrush in. Any type of disruption brings about change and associated discomfort, whether it be personal change or large organizational change. Some people get paralyzed when they are disrupted, and being able to remain flexible is very important. To be a disruptor in an organization, sometimes it is necessary to take action and ask for forgiveness later. Technology has transformed from a series of organized and long-term steps, such as moving from central computing to client-server to personal computers, and now has erupted in choices (e.g., open source database systems versus proprietary systems) and mobile devices and expectations to have access to information from anywhere. * What characteristics or attitudes make a person good at leading innovation? A recognition is needed that the business will change – it always does. There are many examples of companies that did not effectively deal with the change, such as Kodak, Nokia, Blackberry, Polaroid, etc. Each was excellent at what they did, but they did not effectively deal with the disruption that was occurring to their business model. Consequently, one sign of leadership for innovation is being willing to do new things imperfectly to identify new opportunities. The forces outside of a company – the market – are significant. The market is way ahead of what companies are currently doing. This is another significant disruptive force. * How do you watch for and identify market trends? You have to be ahead of the game. While listening to customers is important, if you’re only listening, you’re reacting and behind of what is occurring. Companies need to create differentiating technology capabilities.

I am doing another interview in my Design Thinking series and the topic of this episode is the impact of moving design principles into what is commonly called the Fuzzy Front End (FFE). I personally prefer the term Managed Front End, because, while it is fuzzy, full of unknowns and chaotic at times, it is also manageable. I spoke with Design and Design Thinking researcher and practitioner, Giulia Calabretta. She is an assistant professor at Delft University of Technology in the Netherlands. She contributed a chapter with a coauthor to the Design Thinking: New Product Development Essentials from the PDMA book titled, “Integrating Design into the Fuzzy Front End of the Innovation Process.” Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * What drew you into the field of design? Giulia’s background is in business and management and she has always been interested in innovation. She believes Designers have the best tools for helping companies with innovation. Designers are human centered and should be part of the innovation plans of companies. When they are, the innovations are much more successful. * We need a common understanding of the FFE. How do you describe this early stage of product innovation? It is a messy moment in the innovation process. It begins when people in the company wish to do something new, recognizing a customer need or problem they can take action on to solve. This involves searching for opportunities, idea generation, and idea selection aligned with what is best for the company. * What challenges exist in the FFE? Uncertainty is a key challenge. Companies don’t know exactly what course of action to take and if they will be successful with the course taken. To deal with the uncertainty, some companies will attempt to collect too much information and then have the challenge of knowing what to do with it. They may also involve numerous people throughout the organization in an effort to limit risk but this greatly complicates the decision-making process. * What design practices help with problem definition? One way designers help is to broaden the perspective on innovation. They are good at reformulating specific objectives to consider the broader reasons behind them. An example is public transportation company 9292 in the Netherlands. They provide services to help people understand their best options for public transportation to get from one place to another. When Google maps became popular, 9292 found their service was being used less. They enlisted designers, asking them to create a new website to bring customers back. Instead, the designers asked the company what they really wanted to achieve and after a series of creative workshops (generative sessions) determined that the larger goal was creating deeper relationships with customers. After reformulating the problem, they determined that a new website was not the best solution. Instead, they created a series of personalized mobile services for smart phones, elevating 9292 to be the preferred public transportation planner in the Netherlands. * How does design help us manage information in the FFE? In dealing with uncertainty in the FFE, an overwhelming amount of information can be collected while still not necessarily having the information actually needed. Designers have creative ways of doing user research as opposed to traditional market research to determine what customers really want and consider valuable. An example is Context Mapping, which is a visual journaling process consumers can do without a researcher present to map their behavior over a period of time. An example is applying Context Mapping to understand the relationships between a consumer’s shopping behavior and their eating behavior. The consumer takes pictures over the course of a few days of him or her cooking, eating, shopping, etc.

When it comes to innovation, there are significant distinctions between startups and large enterprises. Startups have the advantage of agility and ability to rapidly change directions because they are not encumbered with legacy systems and organizational constraints. Large enterprises have access to greater resources and an established brand but also have erected barriers to innovation over time and inertia to change has set in. Such enterprises often reach a point where they realize that their existing culture, processes, and structure have limited their innovation to the point of harming the organization. I frequently have conversations with leaders of companies about these very issues. What should large companies do that wish to be more innovative? A place to start is benchmarking the actions Caterpillar is taking to overcome innovation barriers they created over many years and turn the organization into an innovation machine. To explore their actions, I had the sincere pleasure of talking with Ken Gray, Caterpillar’s global Director of Innovation. Ken has worn many hats at Caterpillar, including mechanical engineer, product manager, global product manager, and leader. He is well suited for the Innovation role. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * When did you start your career at Caterpillar? Ken has worked for Caterpillar for 33 years. He made the decision in second grade, telling his mom he was going to become an engineer and work for Caterpillar when he grew up. * You have been an engineer, project manager, product manager, program manager, and in other management and leadership roles.  What principles guide your leadership philosophy? Ken uses the “kitchen table” approach to managing his team. The term comes from his experiences growing up in his home where dinner time at the kitchen table was used to explore any topic – nothing was off-limits. It was the time to bring up tough subjects and hone listening skills. At Caterpillar, his teams are rankless and anyone can share anything. People are encouraged to be brave. When difficult topics need to be discussed, his team members preface the conversation with “we need kitchen table time.” Organizations need to practice open communication regularly so when the tough issues arise, people are willing to share them with leaders. Listening is an active process that requires empathetic and attentive listening while asking clarifying questions as well as questions that help team members learn. * The role you are in now is new to the organization, the Caterpillar Director of Innovation. How did this role and the associated Analytics and Innovation Division come into existence? Given the large size of the organization (global operations with 110,000 employees), Caterpillar has found pockets of innovation in the company but topline performance of the business has been essentially flat since 2009. Executive leadership recognized the organization must be more innovative to continue growing the top line. This resulted in the creation of the Analytics and Innovation Division. The analytics dimension results from the large amount of data collected from machines Caterpillar makes. It is this data that, coupled with ideas from any other sources, helps to drive innovations. Consequently, the analytics group and innovation group needed to be as close as possible, resulting in a single division. * How is your role structured related to increasing innovation at Caterpillar? Ken is trying to create new viable businesses for Caterpillar. While the group will continue looking at innovations related to existing machines, the goal is new business development. Ken structures his work into three innovation categories: * Core – doing what Caterpillar already does but doing it better.

In this episode I’m talking with the creator of an entire category of product innovation – one that significantly changed how I think about the process of innovation. Clayton Christensen said his approaches “bring discipline and predictability to the often random process of innovation.” The category of innovation is known as ODI, Outcome-Driven Innovation, and it was created by Tony Ulwick. When ODI was published in the Harvard Business Review, they declared it one of “the ideas that will profoundly affect business as we forge ahead in today’s complex times.” Tony also authored the best-selling book What Customers Want, explaining how the jobs-to-be-done framework is transformed into practice with ODI. Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * What experiences led to you creating Outcome Driven Innovation (ODI)? At IBM, Tony worked on the PC Junior as a manufacturing engineer. The team was very excited to launch the product but within a day the Wall Street Journal declared it a flop! It turned out that they were right and the cost to IBM in a failed product was over $1B. This got Tony thinking about the metrics to determine what makes a good product – a product that customers want. This was the start to Outcome Driven Innovation, which has matured over the last three decades. * Can you briefly share the key components that make ODI work? The key component is understanding the metrics people use for getting the job done – measuring what people want the product to accomplish for them. Customers don’t describe metrics for a product but do discuss the job they want to accomplish in terms of metrics. An example is a product for teeth whitening and the job customers want done is to have whiter teeth. Associated metrics include how much whiter their teeth can be, the convenience involved, and the financial costs. All the metrics are categorized into one of three areas – core/functional, consumption, and financial. * What is the specific language associated with a customer need? A perfect need statement uses a specific syntax based on three characteristics of needs: (1) it has to be a measure of customer value, (2) it has to be measurable and controllable in the design of the product, and (3) it must be stable over time. Details of the syntax are described in What Customers Want. * How are need statements captured? There are many approaches, such as ethnographic research and face-to-face interviews, but we have found that phone-based interviews work well when performed by a skilled practitioner. Interviews focus on the job the customer is trying to get done and understanding the details of this job and why they are doing it. A “job map” is then created that lays out all of the jobs the customer is trying to get done. * How are customer needs ranked? A complete set of customer outcome statements (needs) is often over 100 items. The objective of ODI is to cast a wide net and capture all possible customer needs. Customers rank the needs by importance and satisfaction. This can also lead to identifying underserved customer segments – segments that cluster around specific unmet needs and who may be willing to pay a premium price to have their needs met. * What about the satisfaction ranking – what have you found about that? ODI allows a composite satisfaction ranking for the product concept to be calculated. If the composite satisfaction is 20% or higher than existing products on the market, people are willing to make the switch and buy the new product. * What about seeing ODI in action – do you have a case study to share that illustrates the process? One example is the Bosch circular saw. ODI was used to examine unmet customer needs.

Brian Lawley is the CEO and Founder of the 280 Group, a company that provides product management and product marketing solutions. Brian has a long history in product management, including product manager for the Apple Macintosh OS. He is also the author of “The Phenomenal Product Manager: The Product Manager’s Guide to Success, Job Satisfaction and Career Acceleration.” Brian and his 280 Group team recently conducted a research project titled the “Challenges in Product Management 2015.” We discussed the key findings from the study.   Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * This is the first year of the study – why did you decide to produce it? There has never been a comprehensive study about the challenges that product management organizations face. Other studies have focused on product managers while our study focuses on impact of product management to the organization. * Before diving into the findings of this year study, what are your overall impressions of how product management has changed in the past few years? The importance of product management has increased. One report states that the product manager is the fourth most important role in organizations. Technology companies recognized this first but today product managers are found in all industries. * What do you know about the participants in the study? 890 people participated in the study. 30% were directors and VPs, 41% were product managers, and 20% were senior product managers. Two-thirds were from the US. Numerous industries are represented. * How is the role of product manager viewed in companies?  61% are viewed as leaders in their company but 57% are too tactical and not strategic enough. The challenge of product managers is to free up at least 30% of their time to work on strategic activities. Product managers spend too much time managing feature lists and requirements instead of holistically managing the product to optimize value for all stakeholders. * How do product managers feel about their competency in the role? Most product managers receive no formal training in their discipline. Across teams, product manager skills vary greatly. Some product managers have very advanced skills. Most respondents shared that their knowledge was average or below. * What did you learn about product management processes in organizations? 49% believe that their product management process is their biggest challenge while 40% of directors and VPs believe their processes are a challenge. About 55% responded that their process is not well defined or standardized. The companies with the most product challenges are those without clear and standardized processes. * What did participants say about improving the product management process their company uses? There was clear recognition that improving processes would increase product success and organizational profitability. * A topic that has come up several times in Agile communities is the role of product manager vs product owner. Did the study examine this intersection? Of companies that said they are doing Agile development, 70% shared that the same person has the roles of product manager and product owner. A key issue is that many of them have not been trained in product management and many have also not been trained as a product owner. On small projects, a person with the right skills and experience can be successful as the product manager and product owner. On larger projects this becomes cumbersome and strategic focus is lost. When separate people are used for the roles, trust must exist between them to be effective.   Useful links: * Challenges in Product Management 201...

My guest is Allan Anderson. He is a keynote speaker at the 2015 Product Innovation Management conference. For the past 20+ years he has been refining his skills in product development and change management, gaining three perspectives as practitioner, academic, and c-level leader in companies. He earned a PhD in Product Development from Massey University in New Zealand, where he is also a professor.     Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * How did you get your start in product development? Allan pursued food technology in college which led to a specialization and graduate degree in product development. * In the description to your keynote speech at the Product Innovation Management conference you shared that “often, there is very little understanding of the principles that truly underpin good NPD practice and how these principles should be applied within a specific company.” Are you suggesting that a one-size-fits-all approach to NPD doesn’t work – that the best practices used by one company may not work as well in another company? There’s been a tendency for companies to adopt a product development process found in books or provided by a consultant without really understanding why the process was chosen and considering if it is best suited to them. Allan refers to this as a paint-by-numbers approach. Instead, he encourages companies to develop processes that are specifically created for their culture, structure, and needs. Organizations should develop their own product development process built around a model with three components: (1) do the right things – choose the right products to work on with the right focus for the organization, (2) do the right things right – choose the processes and practices that are appropriate for what you wish to achieve and measure their success, and (3) create a culture and working environment that helps you to be successful. The key objective is learning what works for the organization. * How can NPD performance metrics help an organization determine what is important and how to continually improve? Traditional metrics used in product development are lagging metrics that focus on outcomes. They don’t lead to any form of learning. Instead, use “contributing metrics” that influence the desired outcomes. For example, does the organization have the right portfolio management in place, are the right cross functional teams in use, is the fuzzy front end being given sufficient attention, etc. * What metrics should be used? Allan uses his model of (1) doing the right things, (2) doing the right things right, and (3) creating an innovation culture to create metrics that are appropriate for the organization. The objective is to lead to learning and improvement of the product development process. What is important is the discussion that occurs around metrics and what are the key areas for the organization to improve product development. It is important to involve the entire organization and identify discrepancies in perspectives between groups, such as between manufacturing and engineering. This produces opportunities for deeper learning and process improvement. It also increases ownership of the processes. * Do you have an example of an organization that used performance metrics to transform their NPD process? When Allan was the CEO of the New Zealand Dairy Industry, an R&D group with about 400 employees, he applied his model to define the important metrics and factors for their product development success. In doing so, this led to discussions that brought employees together and improved teamwork. The focus was on people and encouraging people to talk to other people in the company.

There is a great TED talk by Steven Johnson titled “Where Good Ideas Come From.” Steven shares the importance of coffeehouses and how many innovations we recognize that took shape through discussions in coffeehouses. Interestingly, I met today’s guest, Larry Marine, at a coffee shop. I heard him discussing product design and started talking with him about the innovation research I was doing at the time. We later co-authored chapter 5 in the PDMA Toolbook 3 titled “Integrating User Observations with Business Objectives to Drive Product Design.” Larry is a User Experience expert that has helped many companies improve their products as well as design new products.   Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * What was your path to working in UX? Larry discovered Don Norman’s new Cognitive Science program at UC San Diego after serving as a computer tech in the US Navy. Norman is known as the father of usability and user experience. Larry was in the first graduating class of cognitive psychologists. * What is the essence of UX work? Fundamentally, it is seeking to understand how users will react to specific stimuli in a given context. For example, identifying how a user will respond to a user interface. Our goal is to create the right experience for the context. A classic example is door handles – instead of expecting users  to push on a handle to open a door inwards, give them a flat panel which can only be pushed. * Can you share examples of a project where UX changes took an average product and made it a great product? For a software example, Larry redesigned the user experience of ProFlowers– the website for selecting and ordering flowers. The design was different than all the other online florists at the time. The web developers actually didn’t implement the design because it didn’t “look” like the competitors. The ProFlowers leadership team had the developers implement the new design. Their sales surged and ProFlowers.com has been one of the top performing websites for conversions. The other example is a medical device that performed blood screenings. Users were complaining about its use and Larry was asked to redesign the user interface. After investigating how the machine was used in a laboratory, the actual problem was with the lack of integration between five machines. It was a manual process to move from one machine to the next, data had to be reentered, and blood samples could be mixed up. The solution was a new screening control system for the entire laboratory. * When you make an impact like that, where do you start? By stepping back from the problem, we always find a larger unmet need. We start with an audit to understand who are the users, what problem they are trying to solve, and their objectives. For ProFlowers, the way online florists at the time were selling flowers did not match the problem customers had. Websites asked customers to build a bouquet instead of solving the actual problem, which was buying flowers for a special occasion. In the redesign, the customer is first asked what occasion they are buying flowers for (birthday, anniversary, Mother’s Day, etc) and then they are shown bouquets in various price groups and color options. * Walk us through the steps of conducting an audit. It begins by identifying who the users are and then understanding what problem they need solved. We need to understand what the users currently know and what they need to know to succeed in the tasks that solves the problem. This is a deeper level of information than busi...

Mark Zeh was already developing products using a methodology that was very similar to what IDEO was doing when he joined them. The approach has since been coined Design Thinking. He views the use of storytelling coupled with prototyping as the keys that make Design Thinking work so well. Mark started his design career in the US creating custom mountain bike frames in Minneapolis that carried his name. He worked for product design giant IDEO in the US and helped to lead the office in Germany. He also consulted independently to numerous companies, applying Design Thinking, and is now at Bose, the audio technology powerhouse. In addition, he leads the Entrepreneurship program at the Munich Business School. I invited him to share his insights on using Design Thinking, which he recently wrote about in the PDMA Essentials book titled Design and Design Thinking. His chapter is The Key Role of Stories and Prototypes in a Design Thinking Product Development Process.” Practices and Ideas for Product Managers, Developers, and Innovators Summary of questions discussed: * You use a Design Thinking product development framework. What are the components of that framework? (1) identify customer needs, (2) the cycle of build, test, iterate, and refine, (3) validate and communicate what you found to the organization, and (4) a product development process (not shown in diagram). The activities need to be performed in this order– jumping ahead only leads to problems.   * What is the role of story in Design Thinking?   Knowledge is captured in stories, not raw data.  When examining a need and how customers are behaving, building a narrative is important to communicate to others on the product team.  Stories are the foundation of the process.  They begin by understanding what already exists and then envisioning the future. * What is a prototype and how is it used with story?  A prototype is something you can engage with physically. It is a tool to help you communicate and test ideas. It is refined through iterations as the value proposition is further understood.  Putting prototypes into the hands of  customers actually causes them to think differently than simply talking about the concept. As a product designer, you need to get customers engaged in the concept and this is accomplished through the prototype.  Don’t start building the product early – first get feedback by iterating through prototypes. * How can story and prototyping be combined to improve a product development process?  Story and prototypes are intertwined.  The prototypes are props for the story,  allowing for the story to be acted out.  A prototype is a more effective communication tool than words for aspects of the story. * Can you share an example of a successful product that resulted from applying this framework? The Lemond G-Force RT Recumbent exercise bike is one of the few examples Mark can share publicly. Mark learned that many women were buyers of recumbent exercise bikes but bikes were not tailored for their purchasing process. The design of the bike was influenced by observations of the purchasing process of women:  who the buyer is, how they interact, how the exercise bike gets home, and where it is placed in the home.  The key insight learned was that the exercise bike should look like architecture – a design feature of the room where it is placed. Those insights drove the creation of prototypes and ultimately the final product. * With all the design experience you have accumulated over your life, if you could, what would you tell the 25 year old version of yourself?  Listen better.  Dig deeper into what people are saying and develop empathy to better understand what they’re telling me.   Useful links: *