Escaping the Build Trap: How Effective Product Management Creates Real Value

by Melissa Perri

Sales-led companies let their contracts define their product strategy.

Another common way of operating is the technology-led company. These companies are driven by the latest and coolest technology. The problem is that they often suffer from a lack of a market-facing, value-led strategy.

Product-led companies optimize for their business outcomes, align their product strategy to these goals, and then prioritize the most effective projects that will help develop those products into sustainable drivers of growth.

Think of all of the different roles in a company, from sales and marketing to tech and design. So many of these functions don’t cross over much between the tech side and business side. Product managers are the ones who fit right in the middle and translate needs into a product that will satisfy the customer while sustaining and growing the business.

The product manager deeply understands both the business and the customer to identify the right opportunities to produce value. They are responsible for synthesizing multiple pieces of data, including user analytics, customer feedback, market research, and stakeholder opinions, and then determining in which direction the team should move. They keep the team focused on the why — why are we building this product, and what outcome will it produce?

The product death cycle is a specific form of the build trap. You are implementing ideas without validating them. It’s not the customer’s job to come up with their own solutions. That is your job. You need to deeply understand their problems and then determine the best solutions for them.

So, many of the project managers that once existed in these companies have now been made product managers or product owners. But they often lack the experience needed to be a great product manager. Answering why is very different than answering when. It requires a strategic mindset that understands the customer, business, market, and organization. This is a critical skill set for a great product manager.

A frequent question I get is, “What is the difference between UX design and product management?” These two disciplines overlap quite a bit, but user experience is only one piece of building a great product. Design is a critical component of a successful product, but, again, it’s only one piece. Product management is about looking at the entire system — the requirements, the feature components, the value propositions, the user experience, the underlying business model, the pricing and the integrations — and figuring out how it can produce revenue for the company. It’s about understanding the entire picture of the organization and figuring out how the product — not just the experience — fits into it.

The product manager carefully balances the line between all disciplines to be able to strategize and decide what is best for the product. A great product manager listens intently to the inputs given from all their team members, but, at the end of the day, they make the difficult choices about what will be best for the business and the user.

“The biggest thing I’ve learned in product management is to always focus on the problem. If you anchor yourself with the why, you will be more likely to build the right thing,”

The biggest issue I hear from leaders, when I go in to help their organizations become product-led, is that their product managers won’t step up and “own the product.” But, this is a double-edged sword. In many cases, the product manager can do more to lead the product. They can question solutions and push back on things handed down. But the work required to gather data and prove the solution takes time. This is where people usually become confused between what Agile calls a product owner and a product manager.

In other words, product owner is a role you play on a Scrum team. Product manager is a career.

Most organizations do not give their people the necessary time to do product vision and research work. They would rather hold them responsible for a steady stream of outputs and measure success based on stacking backlogs and writing stories.

Product managers ultimately play a few key roles, but one of the most important ones is being able to marry the business goals with the customer goals to achieve value. Good product managers are able to figure out how to achieve goals for the business by creating or optimizing products, all with a view toward solving actual customer problems. This is a very important skill set.

As a product manager, your roles and responsibilities will change depending on your context, the stage of your product, or your leadership position in the organization. Without a Scrum team or with a smaller team, you might be doing more strategy and validation work for a product that has not been defined yet. With a Scrum team, you might be more focused on the execution of solutions. As a manager of product managers, you might be leading strategy for a larger part of the product and coaching your teams to discover and execute well.

I have listened to many arguments that product owners do not have time to do both roles. In the current context, that’s true. The product owners I speak with spend 40 hours a week writing tons of user stories. At that point, you need to ask, are those user stories even valuable? What are they prioritizing them against? How do they know that they will solve a problem? If you have one person spending that much time writing user stories, every week, you are most certainly in the build trap. With a good strategy framework in place and ruthless prioritization around a few key goals, one person can effectively talk to customers, understand their problems, and help to define the solutions with the team. The amount of external versus internal work will shift, depending on the maturity and success of your product. But, you should never be doing all this work at once.

I teach my clients that product managers in senior roles (VPs, product leads, or middle managers) concentrate on defining the vision and strategy for the teams based on market research, an understanding of company goals and strategy, and by looking at the current state of success of their products.

Tactical work for a product manager focuses on the shorter-term actions of building features and getting them out the door. It includes the daily activities of breaking down and scoping out work with the developers and designers, in addition to crunching the data to determine what to do next.

Strategic work is about positioning the product and the company to win in the market and achieve goals. It looks at the future state of the product and the company and what it will take to get there.

Operational work is about tying the strategy back to the tactical work. Here is where product managers create a roadmap that connects the current state of the product to the future...

When you try to advance on the career ladder, the product owner will not have the experience with strategy that is needed to be effective. I believe it’s best, as an industry, that we forgo product owner as a title and call everyone in this position a product manager so that there is a consistent and meaningful career path.

A senior product manager is responsible for the same things as a product manager, but they oversee more scope or a more complex product. It is as high in the product management field as you can go as an individual contributor, meaning that they do not do people management.

This is the role for people who like difficult product problems. They want to work on new, innovative products and to chart new territory for the company. Their role is very similar to the architect role in development, which focuses more on laying the development structure and scaling it rather than managing other developers. Senior product managers are critical to the success of companies of all sizes because they can operate more independently than many product managers. They are also usually entrepreneurial, which is a great trait, since these people are usually the ones who will start new product lines for businesses.

The director of product is responsible for the strategic roadmap of the product, usually looking at a time horizon of a year. They are also responsible for the operational effectiveness of the team, making sure all product managers are aligned by the appropriate goals and working on the most important items to move the product forward.

The VP of product is responsible for connecting the company goals back to the growth of their product line. With inputs from the people on their team and the data they provide, they set the vision and goals for the overall product. In large, enterprise companies, VPs of product are also directly responsible for the financial success of their product line, not just the delivery of product features.

A CPO oversees a company’s entire product portfolio. This is the highest role of a product manager, and it represents a seat at the executive table of a company.

Assuming they are already skilled in all aspects of product, technology, and financial management, those that make the best chief product officers also have three key traits that set them apart: they inspire confidence, empathize, and are relentless and resilient.

A value stream is all of the activities needed to deliver value to the customer. That includes the processes, from discovering the problem, setting the goals, and conceiving of the idea, to delivering the actual product or service. Every organization should strive to optimize this flow in order to get value out the door faster to customers. To do that, it makes sense to organize your teams around the value stream.

Product managers need room to manage toward an entire outcome-oriented goal. This means that people need to be aligned around value and to have the scope to actually make measurable impact toward it. This gets to what we were talking about earlier — organizing teams around your strategy, which is the most important work for your business.

A good strategy is not a plan; it’s a framework that helps you make decisions. Product strategy connects the vision and economic outcomes of the company back to product portfolio, individual product initiatives, and solution options for the teams.

Strategy creation is the process of determining the direction of the company and developing the framework in which people make decisions. Strategies are created at each level and then deployed across the organization.

Gibson Biddle, who was a VP of product at Netflix from 2005 to 2010, talks about aligning his team around a common guideline for evaluating its product strategy. That guideline was to “delight customers, in margin-enhancing, hard-to-copy ways.” He set goals that would accomplish this and would help Netflix execute on the company vision around key initiatives (Table III-1), including personalization, instant access to entertainment, and ease of use. Teams were then able to explore tactics to accomplish these goals, and they were held accountable to success metrics for each.

The powerful thing about a strategic framework like the one Netflix uses is that it forces you to think about the whole before zooming in on the details.

When a company thinks only about the feature-level model, it loses track of the outcomes those features should produce. That is what lands you in the build trap.

Good strategy isn’t a detailed plan. It’s a framework that helps you make decisions. Too often, people think of their product strategy as a document made up of a stakeholder’s wish list of features and detailed information on how those wishes should be accomplished. And they’re peppered with a ton of buzzwords like platform or innovation.

Strategy is a deployable decision-making framework, enabling action to achieve desired outcomes, constrained by current capabilities, coherently aligned to the existing context.

Product teams need the freedom to explore solutions and to adjust their actions according to the data they receive. As long as they are aligned with the overall strategic intents and vision for the company, management should feel comfortable granting the necessary autonomy to capable teams.

Think of the major pieces of work you do that are actually bets. Henrik Kniberg, a former consultant at Spotify, explains that this is how Spotify thinks.1 The company operates using something called DIBBs, which stands for Data, Insights, Beliefs, and Bets. The first three things, data, insight, and beliefs, inform a piece of work called a bet. The concept of thinking of initiatives as bets is powerful because it sets up a different type of expectation.

Strategies are interconnecting stories told throughout the organization that explain the objective and outcomes, tailored to a specific time frame. We call this act of communicating and aligning those narratives strategy deployment.

In most product organizations, there should be four major levels in strategy deployment (see Figure 12-1): Vision Strategic intent Product initiatives Options

Strategy is about how you take the organization from where you currently are and reach the vision. For strategy to be created, you must first understand the vision, or where you want to go. Then we can identify problems or obstacles standing in our way of getting there and experiment around tackling them. We repeatedly do this until we reach the vision.

This is the basis of the continuous improvement framework practiced at Toyota, called the Improvement Kata, which helped it determine its strategies. The Kata teaches people in the company how to strategically tackle problems to reach goals. Mike Rother documented how the process works in his book, Toyota Kata, an excerpt of which you can see in Figure 12-2.

One of the biggest issues I hear from executives is that they do not have the data they need to make decisions. People ask them to create a vision, but they do not continuously surface information in a way that helps inform the strategic decisions that enable the organization to achieve the vision. The teams should be out there, analyzing, testing, and learning and then communicating what they discover back to their peers and their management teams. This is how we set strategy.

Although the vision should remain stable over a long period of time, how you intend to reach that vision changes as your company matures and develops. Strategic intents communicate the company’s current areas of focus that help realize the vision. Strategic intents usually take a while to reach, on the magnitude of one to several years.

These are not small goals. They need an army to execute, from product development to marketing to content creation. That’s the point. The strategic intents are about the whole company, not just the product solution.

Product initiatives translate the business goals into the problems that we will solve with our product. The product initiatives answer how? How can I reach these business goals by optimizing my products or building new ones?

Product initiatives set the direction for the product teams to explore options. They tie the goals of the company back to a problem we can solve for the users or customers. Product managers are in charge of making sure the product initiatives and options are aligned with the vision of an existing product or portfolio. Sometimes, you might even end up creating new products to solve these problems for your users. The product vision and portfolio vision keep you anchored in the problems and solutions that you want to explore.

The product vision communicates why you are building something and what the value proposition is for the customer. Amazon does this particularly well by creating what they call Press Release documents for every product vision. These short (typically a page or two) notices describe the problem the user is facing and how the solution enables the user to solve that problem.

Companies with more than one product often wrap their products under what is called a product portfolio. Very large companies have multiple product portfolios, all aligned by the type of value they provide to customers.

The product initiatives emerge from the work that needs to be done across the product portfolio to achieve the strategic intents and to further the individual product visions. This is also where you want to make sure that you are balancing the work of the teams with the direction of the company. The CPO is responsible for figuring out how to balance these areas of work in a framework.