Striking the Right Balance to Manage Innovation

Date: 2012.05.07 | Category: Innovation, Product Management | Comment: 0

I was reading a great article in Harvard Business Review about managing your innovation portfolio.  It made me appreciate that for most organizations, it is difficult to strike the right balance of core, adjacent and transformational innovation.  As a new product development manager, I enjoy working on the real breakthrough ideas, but those are few and far between. There is only so much funding available for capital projects and only so much risk an organization can undertake. So what kind of new product innovation will your organization choose to focus on? There are three types:

Core Innovation –They are the successful products you have already launched to market. If they have been successful for a long time, they are often referred to as “cash cows”; they bring in the revenue that fund new initiatives.  If you work for a low-risk organization, the CEO probably wants you focus on different ways to milk that cow (small incremental improvements) rather that rock the boat working on brand new initiatives. It can be reassuring to be the Product Manager for a cash cow because you know your market, you know what the customers want and you just bring it to them. The trouble is that one day, that cow will dry up and the organization too if it has not invested in adjacent and transformational innovations.

Adjacent Innovation – I have an example from my software days. I worked for a company that built Unix GUI tools. We sold them for thousands of dollars per license and our market loved them as we saved developers many hours of coding work – plus our GUI’s made our client’s software look good. However, the market changed as Windows and Java became popular and the market for expensive Unix environments declined. So we decided to develop our tools for Windows and Java but making that leap was not easy; we had to hire new talent and understand new markets (price points, features/functionality, platform requirements, competitors etc…).

Transformational Innovation- This is when you do something completely different from what you have done before. Building the capabilities for game-changing products typically requires a lot of funding and is very risky. The difficult part is that the customer is often not ready and/or has no knowledge of your offering so you have to spend a lot of time and money educating the market. This is why only 10% of all real game-changing innovation actually succeeds in the market place. For mature company, only 1% of transformational innovation succeeds. In my experience there are three key success factors for transformational innovation: (1) a strong Executive sponsor who can communication a clear vision, (2) funding (yes, let’s state this one more time), and (3) good metrics to make decisions – without metrics bad ideas are too slow to get killed.

As a product development manager responsible for new product ideas, I spend a lot of time educating and encouraging everyone from the C-Suite to the ground floor to look for and share ideas. I review a lot of ideas with my New Product Innovation Committee. It’s good to look for the really good ideas but we also need to remember that we have to manage our total innovation portfolio which means core improvements and adjacent innovations as well.

5 Main Differences Between Project and Product Management

Date: 2012.01.03 | Category: Product Management | Comment: 0

Project and Product Management represent two separate functions each with its own goals and reasons to exist. Having said that, the functions do have similarities but they also have important differences. At a high level, Project Managers ensure the work is planned, executed and delivered according to the scope, within budget and on time.  Product Managers, on the other hand, are responsible for ensuring products are created, tested and delivered so that they meet customers’ requirements. The creation, planning, development and launch of a new product is one project or a combination of projects. Once a product is launched to market, the Product Manager manages the product through its life cycle whereas the Project Manager moves to another project.

In my opinion, here are the 5  main differences between Project and Product Management:

1) Projects have a clear beginning and an end – Products are an ongoing effort until their end of life.

2)  Good Project Management does not need passion for the product to move the team to deliver what is required. Good Product Management requires passion and ownership of the product.

3) Project Management has clear methodology and a certification process. There are best practices for Product Management but no methodology.

4) Project Managers are concerned with staying within budget – Product Managers are concerned with cost to develop the product and/or feature (investment) as well as the potential revenue (the whole business case). Normally, Product Managers are responsible for the product’s P&L and must ensure the product is profitable.

5) Project Managers are not normally as intimate with a product’s customers as Product Managers are but there are exceptions to this. Some Project Managers manage the installation or customization of products for specific customers. In this instance, a Project Manager could become even more intimate with a customer than a Product Manager would. The Product Manager must look at the market as a whole and not single out one customer so the product must benefit the organization (profitability) and the target market(s) for the long term; the Product Manager should not be steered in her decisions by one specific customer.

Can you think of other main differences between Project and Product Management? Let me know!

Product Management Is About Closing The Gaps

Date: 2011.10.30 | Category: Marketing, Product Management | Comment: 0

I was asked very recently to define my role and what I should be responsible for. This is not an easy task for me to accomplish for two reasons: (1) if I go too narrow I could pigeon-hole myself into one area of product management and not be able to make as big an impact as I would like in others (yeah, I am a bit of a control freak and I love to have a hand in just about everything); (2) if I go too broad, I might not be able to meet all of the obligations of my role. 

If you take a moment to examine the Pragmatic Marketing Framework, you will notice that product management is in fact a very broad role. One way to slice this framework is to focus on more strategic activities (top left quadrant), more technical activities (bottom left quadrant), or more tactical activities (right-hand side). No matter how you slice it though, if you are responsible for a portfolio of products, you just cannot do it all.

Then I found another better way – I analyzed innovation, product management, product development, project management and marketing roles at my organization and I discovered gaps where I can have the most impact and create the most value. I focused on the gaps and defined the role and presented it to management in order to obtain executive support.

A good lesson for all of you PM’s out there: executive support is very important. Since PM’s have no authority and A LOT of responsibilities, we really cannot accomplish much if we do not have executive support. So in the end, I realized that I can lead a number of initiatives, work with others to meet my organization’s needs and close the gaps.

Product Management in a Non-Technical Company

Date: 2011.08.21 | Category: Innovation, Marketing, Product Management | Comment: 0

I recently moved jobs from a company in the telecom industry to a company in a non-technical field. My new company delivers services that help people. We use technology to enable the delivery of some of our services however, we do not produce a technical widget or software as the core of what we do. You may wonder, what is it like to be a Product Manager who does not deliver technology products?

Let me start by stating the definition of product management which is using business savvy and creativity to manage a product from inception, through its lifecycle, and until it is discontinued. Whether I am managing a technology product or a service, the definition of product management and the fundamentals of the role are the same. In my industry, the same service has been delivered to customers for about 30 years. This service has a very long lifecycle! The reason I was hired was to make us sexy again by innovating in new areas.  I can do this by adding new services or delivering the existing services in new ways.

Formulating a 90-Day Plan For a Product Management Role

Date: 2011.06.13 | Category: Product Management | Comment: 1

I was asked  to formulate a 90-day plan for a new Product Manager role. This role was created to drive the strategy around the “right mix” of partners and solutions in a new emerging technology area. A 30-60-90 plan shows a potential employer how you plan to hit the ground running and can set you apart during a competitive interview process.  Here is my plan:

Before The Start Date

• Obtain all information publicly available to get up to speed on what is happening with the organization (e.g. annual
  reports) and the industry.

Day 1-30: Learn my way around get to know the team

• Meet with my manager to identify top priorities for my department and what is expected of me. Set up a time for weekly status meeting.
• Meet with each member of my team to learn their role, challenges and opportunities. Find out what they expect of me and how I can help them.
• Meet with as many top influencers as possible and ask them valuable suggestions about my role and about navigating the
  organization.
• Learn the corporate systems, the internal workings of the company and read the company policies and procedures.
• Attend any orientation or training offered.
• Review the list of existing partners and study what is known about them, how they have been performing, etc…
• Subscribe to industry online news, thought leadership, and any other industry online resources.
• Go to lots of meetings and offer to help on small initiatives.
• Read as much as possible and study to continue to improve industry and product knowledge.
• Draw up the logical value chain (ecosystem) for the industry and find out as much as possible about each value step and how the organization adds value (or could add value).
• Listen and take lots of notes.

Day 31-60: Take ownership

• Meet with my manager for a first 30-day review. Ensure I am focusing on the right activities and adjust as necessary.
• Take ownership of some projects.
• Contribute my thoughts/ideas on how to streamline industry partners and programs.
• Make a list of activities/project that will contribute to meeting the department objectives and set up a plan to reach the goals.
• Go to lots of meetings and begin to run some of them.
• Continue to build relationships.
• Begin to write materials (drafts)
• Continue to learn and read as much as possible.
• By this time I hope to have uncovered some promising unexploited opportunities for growth and have begun to figure out how to exploit them.

Day 61-90: Begin to take on more of a leadership role

• Check-in with my manager for a first 60-day review. Discuss how things are going, review progress on projects I am involved in and offer new ideas. Reach agreement on how to move forward and secure sufficient resources to get things done.
• Obtain constructive feedback from team members on my progress.
• Start to recommend new partners.
• Use my integrative thinking and propose new solutions or better ways to add-value to partners or programs. Ensure the
  strategies I am proposing match the business environment.
• Share my ideas on developing new ways to reach out to partners and engage with them.
• Start making decisions.
• Take a fuller leadership role.
• Start being a resource to others.
• Keep a focus on problems/projects/activities that are priorities. Create some momentum in a positive and collaborative way.

I consulted some resources for the formulation of my 30-60-90 plan. They are:

Executive Book Summary: Critical Success Strategies for New Leaders At All Levels. The
First 90 Days, by Michael Watkins, Soundview Executive Book Summaries, 2004.

http://www.forbes.com/2006/09/06/leadership-pink-careers-cx_ag_0906ninetydays.html

http://www.thedailymba.com/2010/06/21/your-first-90-days-at-a-new-job/

Thoughts on my plan would be appreciated. Please do not hesitate to comment.