Vol 8 Iss 2

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8 2 201

Is Your Product Launch Doomed?

Measurement-Driven Product Management:Measure only what matters most

Defining and Designing Technology for People

Dont Let the Sun Go Down:

Techniques for sunsetting or retiring products and features

Conjoint Analysis 101:Know how your market

values your product

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Review key concepts of the Pragmatic Marketing Framework,the worldwide standard for product management and marketing.

Learn techniques leaders can use to accelerate adoption.

Designed speci cally for senior management.

Executive Brie ngThe proven way to create e ective

product management and marketing teams.

Get a free e-book atPragmaticMarketing.com/secrets

CompetitiveLandscape

ProductRoadmap Innovation Requirements

SalesProcess

Presentations& Demos

LaunchPlan

StatusDashboard

SalesTools

EventSupport

LeadGeneration

Referrals &References

ChannelTraining

ChannelSupport

BusinessPlan Positioning

MarketingPlan

Win/LossAnalysis DistributionStrategy Buy, Buildor Partner BuyerPersonas CustomerRetention

DistinctiveCompetence

ProductProfitability

UserPersonas

ProgramEffectiveness

ProductPortfolio

TechnologyAssessment

UseScenarios

SpecialCalls

ThoughtLeadership Collateral

MarketDefinition Pricing

BuyingProcess

CustomerAcquisition

MarketProblems

S T R A T E G I C TA

CTI CAL

MARKET READINESS SUPPORT ST RAT EG Y BU SI NE SS PL ANNI NG P ROG RA MS

PragmaticMarketingFramework

1993-2010 Pragmatic Marketing

b y C r a ig S t u l l, P h

i l M y e r s & D a v i d

M e e r m a n Sc o t t

T h e o f T u n e

d I n L e a d e r s

H o w t ec h n o l og y

c o m p a n y C E O s c

r e a t e s ucc e s s

( a n d w h y m o s t f a

i l )

PragmaticMarketing.com/seminars

Call(800) 816-7861 to conduct this seminar at your o fce

8/8/2019 Vol 8 Iss 2

3/32The Pragmatic Marketer Volume 8, Issue 2, 2010 3

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Inside this issue:Volume 8 Issue 2 2010

4 Conjoint Analysis 101:Know how your market values your product By Brett Jarvis

How do you know what the market wants? What marketsegments exist? What those segments prefer? What will theypay? In short, how do you know what trade-offs to make? Byusing conjoint analysis, understand the trade-offs you shouldmake by understanding the trade-offs your market will make.

12 Is Your Product Launch Doomed?By Dave Daniels

The process of introducing a product to market is a seriousundertaking. Here are ten easily identifiable signs that helpforecast if a product launch may be in trouble.

18 Measurement-Driven Product Management:Measure only what matters most By Mike Smart

If you are a vice president, director or team leader for a product managemfunction, one of the biggest challenges you face today is how todemonstrate the team is making a significant contribution to top lineor bottom line targets. If you cant measure your teams effectiveness,or if you are focused on the wrong metrics,

your headcount and budget allocationcould be at risk.

24 De ining and DesigningTechnology or PeopleBy Sean Van Tyne

We can only design solutions forpeople when we have a deep, detailedknowledge of those peoples needs. We build upon our prior knowledgeand experience to design and develop better products. Each newgeneration of solutions improve based on market and customer feedback.

28 Dont Let the Sun Go Down:Techniques or sunsetting or retiring products and eaturesBy Steve Johnson

Sunsetting is the process of pulling a product or feature from the market wthe cost of development and maintenance exceeds profit. Its a businessdecision that should be easy to make. Understand the factors to considerwhen discontinuing product.

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Conjoint Analysis 10Know how your market values your product

By Brett Jarvis

4 The Pragmatic Marketer Volume 8, Issue 2, 2010

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Product management is all about trade-offs. Whether the objectiveis increased market share, profit margin or revenue, every productmanager makes trade-offsquality vs. cost, time to market vs.breadth of features, richness of the offering vs. ease of use, etc.

So, how do you know what the market wants? What marketsegments exist? What those segments prefer? What will they pay? Inshort, how do you know what trade-offs to make? The answer is toget the market to make the trade-offs for you. Not the entire market,of course, just a representative sample of the market.

By using conjoint analysis, you, as a product manager, can do justthat: understand the trade-offs you should make by understandingthe trade-offs your market will make. Then, apply your increasedmarket insight to your revenue, profit or share objective.

Is conjoint analysis right for me?Conjoint analysis has been successfully applied in many industries,such as Air Travel, Smart Phones, Computers, Financial Services,Health Care, Real Estate, and Electronics. If your job includesconfiguring a defined set of features for a product or service andthe consumers purchase decision will be rational, conjoint analysiscan help. If, on the other hand, your consumers purchase decision

will be impulse or image, conjoint is not the right tool for you.If youre a technology product manager, conjoint analysis is rightup your alley.

Because conjoint analysis helps you understand your marketspreferences, you can apply it to a variety of difficult aspects of the job, including product development, competitive positioning,pricing, product line analysis, segmentation and resource allocation.How should we price our new product to maximize adoption?What features should we include in our next release to take marketshare from our competition? If we expand our product line, willoverall revenue grow, or will we suffer too much cannibalization?For which value-added features is the market willing to pay?

For example, a technology company was feeling pressure from alower cost alternative and debated lowering its own prices. Then,the results of a conjoint analysis showed the market valued theirproducts differently from the competitors. They chose not to lowerprices, but to slightly reconfigure their offering. As a result, thebusiness grew and realized substantial profits that they otherwise

would have never seen. Not every situation is as dramatic as that,of course, but a conjoint analysis done right is impactful.

Conjoint analysisis a set of mark

research techniquesthat measures thevalue the marketplaces on eachfeature of your

product and predicthe value of anycombination of

features. Conjointanalysis is, at its

essence, all aboutfeatures andtrade-offs.

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Conjoint Analysis 101: Know how your market values your product

What exactlyis conjoint analysis?Conjoint analysis is a set of market research techniques that measuresthe value the market places on each feature of your product andpredicts the value of any combination of features. Conjoint analysis

is, at its essence, all about features and trade-offs. With conjointanalysis, you:

1. Ask questions that force respondents to make trade-offsamong features

2. Determine the value they place on each feature basedon the trade-offs they make

3. Simulate how the market reacts to various feature trade-offs you are considering

To demonstrate conjoint analysis in action, lets consider cell phoneplans. These plans have various feature types, which in the languageof conjoint analysis are called attributes. Lets focus on Brand, Price,Minutes, Rollover Options, and Call Options. In reality, plans can bemore complicated and conjoint analysis can keep up with thecomplexities, but lets keep the example simple. Each of the attributeslisted above has different levels. The levels of the Brand attributemight be AT&T, T-Mobile, Verizon, etc., but here we will refer topossible Brands as Brand A, Brand B, etc.

Attributes must be something you can categorize, but they dont haveto be numeric. Note that the attributes include brand, price, and

various product features. Through conjoint analysis, you gain insightsinto the value of your brand and the value of product features, anddetermine price sensitivity.

Attributes Levels

Brand Brand A, Brand B, Brand C, Brand D

Price $60/month, $75/month, $100/month

Minutes 800; 1,000; 1,400; 2,000

Rollover Options No rollover o unused minutesUnused minutes rollover or 1 monthUnused minutes rollover or 1 year

Call Options No ree calling based on contactsFree calling to top 5 contacts

Free calling to top 10 contacts

6 The Pragmatic Marketer Volume 8, Issue2, 2010

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Survey the marketConjoint analysis survey questions could take a variety of forms, depending on yourstudy objective, but the most common type of question would be:

The survey would present multiple questions of this type, varying the levels and,therefore, the trade-offs the respondent needs to make.

Derive values for each of the levelsFrom responses to these questions, conjoint analysis uncovers the underlying value foreach level, depending on how often a level was included in the product selected. Therelative value of the levels is what is relevant, in other words, how the value of onelevel compares to the value of another.

For example, the values for the levels of the Call Options attribute and the RolloverOptions attribute for one respondent might be:

You can see in this example, given the levels tested (which is an importantcaveat), the Rollover Options attribute (with values ranging from 0 to 100) wasmore important to the respondent than the Call Options attribute (with valuesranging from 0 to 50). These values can be calculated for individuals as well asfor the overall market, which means you can use conjoint analysis to segment

your market based on respondent characteristics, needs and preferences. Eachof the level values is called a part-worth, because they represent the worthof any given part of the product.

Which o the ollowing cell phone plans do you pre er?Brand A Brand B Brand C

1,400 minutes 1,000 minutes 800 minutes

Unused minutesrollover or 1 month

No rollover o unused minutes

Unused minutesrollover or 1 year

No ree callingbased on contacts

Free calling totop 5 contacts


Costs $100/month Costs $75/month Costs $60/month

Call Options Value Rollover Options Value

Free calling to top 10 contacts 50 Unused minutesrollover o r 1 year

100

Free calling to top 5 contacts 20 Unused minutesrollover o r 1 month

30

No ree calling based on contacts 0 No rollover o unused minutes

0

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Predict preference for various productsOnce you see the part-worths, you understand what trade-offs to make so a product

will be more desirable to the market. This predictive capability is where the real powerof conjoint analysis is evident. For example, given a set of part-worths, you might havethe following scenario:

Brand A 30 Brand C 0

$75/month 40 $60/month 70

1,000 minutes 55 1,000 minutes 55

Unused minutes rollover or 1 month 30 No rollover o unused minutes

Free calling to top 5 contacts 20 Free calling to top 5 contacts 20

Total 175 Total 145

The total value of the Brand A product is 30 more than the Brand C product. Thisconsumer would be more likely to select the Brand A product. But, if the Brand C call

option was changed from Free calling to top 5 contacts (part-worth of 20) to Freecalling to top 10 contacts (part-worth of 50), the overall value of each product would bethe same and the consumer would be equally likely to select either product. The overall

value of a product is referred to as its total utility.

Simulate competitive marketsNow that each attribute level has an associated part-worth, we can create any number of competitive scenarios by mixing and matching the levels and increasing or decreasing thenumber of products. The result of any conjoint analysis study is a simulation model thatallows you to simulate, for example, what share of the market will prefer your product

versus your competitors products. For example, you might see results like this:

These shares, totaling 100%, are called shares of preference, because they refer to theshare of the market that prefers each product, if everything else were equal. They arenot market shares, because they dont take into account a variety of other factors, suchas sales and marketing efforts, distribution channels, product lifecycle phase, etc.

Simulating shares of preference is powerful. And, theres no limit to the simulations youcan run. So, for example, if your competitor changes its product, you can run simulationsto help determine your response. If you are contemplating adding a new product, youcan predict whether that will be beneficial and from which product in the existingmarket your new product will grab the most share. These are simple but potent examplesof the many different ways that conjoint analysis may be used.

Brand A Brand B Brand C$60/month $75/month $75/month

1,000 minutes 1,400 minutes 1,000 minutes


Unused minutes rolloveror 1 month



Free cal ling to top 10 contacts No ree callingbased on contacts

40% share 35% share 25% share


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Are your product management and marketingoverloaded with tactical activities, spending ttime supporting Development and Sales rath

focusing on strategic issues?

1993-2010 Pragmatic Marketing

The Pragmatic Marketing Framework

Visit PragmaticMarketing.com or call (800) 816-7861

CompetitiveLandscape

ProductRoadmap Innovation Requirements

SalesProcess

Presentations& Demos

LaunchPlan

StatusDashboard

SalesTools

EventSupport

LeadGeneration

Referrals &References

ChannelTraining

ChannelSupport

BusinessPlan Positioning

MarketingPlan

Win/LossAnalysis

DistributionStrategy

Buy, Buildor Partner

BuyerPersonas

CustomerRetention

DistinctiveCompetence

ProductProfitability

UserPersonas

ProgramEffectiveness

ProductPortfolio

TechnologyAssessment

UseScenarios

SpecialCalls

ThoughtLeadership Collateral

Market

DefinitionPricing Buying

Process

Customer

Acquisition

Market

Problems

S T R A T E G I C T A

C T I C AL

MARKET READINESS SUPPORT STRATEGY BUSINESS PLANNING PROGRAMS

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In addition to the extensive published schedule, training can be conductedonsite at your office, saving travel time and costs for attendees, and allow

a much more focused discussion on internal, critical issues.

Pragmatic Marketings seminars have been attended by more than

60,000 product management and marketing pro essionals.

Living in an Agile World Strategies for product managementwhen Development goes agile.

Practical Product Management Principles of the Pragmatic Marketing Framework ,the industry standard for managing and marketingtechnology products.

Pragmatic Roadmapping Techniques to plan, consolidate and communicateproduct strategy to multiple audiences.

Requirements That Work Methods for creating straightforward productplans that product managers can write anddevelopers embrace.

Efective Product Marketing Repeatable, go-to-market process to design,execute, and measure high-impact marketingprograms.

New Rules o Marketing Reach buyers directly, with information theywant to read and search engines rewardwith high rankings.

Product Launch Essentials Assess organizational readiness and de ne teamresponsibilities for a successful product launch.Executive Brie ngs

Designed speci cally for senior management,Executive Briefngs discuss how to organizeProduct Management and Marketingdepartments for optimal effectivenessand accountability.

Seminars

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Is Your ProductLaunch Doomed?By Dave Daniels

Products dont sell themselves!

The process of introducing a product to marketis a serious undertaking. Unfortunately for manycompanies its merely an afterthought; a setof deliverables created from a checklist at theend of product development. When the levelof effort and resources applied to the creation

of the product dwarfs that of the launch, its nowonder product launches fail to achieve the salesvelocity anticipated.

So how do you forecast if a product launch maybe in trouble? Here are 10 easily identifiable signs your launch is about to become a disaster.

N E W ! !

Step 1: There are no goalsfor the product launchLaunch goals are the cornerstone of asuccessful product launch, yet many companies fail to establish launch goals.CEOs have an expectation of what successlooks like and believe the rest of the

organization understands these expectations.But often they arent translated intomeaningful goals, and are not understoodby the people tasked with planning andexecuting the launch.

For the sales team, goals are clearly understood. They have a quota and getrewarded for meeting that quota. Themarketing teams contribution to thegoal is less clear. Sales leads are onemeasure of performance but connectingthis measurement to a sales goal is often

problematic. For example, getting agreementon a common definition of a lead.

The target for Sales seems clear but willthe revenue come from existing customersor new buyers?

This question may seem benign to thesales team, but its fundamental to themarketing team as they devise strategies andtactics to support the sales goal. When theconnection between the sales goal and whatthe marketing team does becomes unclear,

the marketing team often retreats into areasthey can control and manage. For example,focusing on deliverables like collateral, webcontent and sales tools. In effect becomingreactionary to the sales teams requests ratherthan taking a leadership role.

ACTIONEstablish launch goals with the executive teamas early as possible and communicate them inmeaning ul ways throughout the organization


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Step 2: The launchstrategy is based ona set of deliverables

A launch checklist is not a launchstrategy. It usually gets createdafter a failed launch. Expecteddeliverables are missing, the salesteam isnt trained, the systems forbooking and delivering the sale areoverlooked, and on and on

To prevent this problem fromhappening again, someoneis assigned to go around theorganization and ask eachfunctional area what they want fora successful launch. The problemis everyone defines successfuldifferently, particularly if the launchgoals are unclear. The result is a

bloated wish list of activities withquestionable value, often growing with each successive launch.

The CEO of a software company, frustrated with poor results from animportant product launch, decidesits time for action. Her reputationwith the board of directors is on theline because the promised resultswere not realized. To ensure the nextlaunch wont be an issue, she createsa Project Management Office (PMO)

to oversee future launches.

The head of the PMO is a highlyregarded project managerwho addresses the problem byinterviewing every department inthe company. Fresh from the recent failure, everyone is more thaneager to participate. The result is athorough checklist and a master project plan template.

Confident the problem is solved,the PMO proceeds to oversee thenext launch. Based on the checklist,the launch team knows whatsexpected and which deliverablesthey are responsible for completing.This time the launch is delayedby several months while each item

on the checklist is completed to thesatisfaction of the PMO. Sadly, therevenue results were no better thanthe last launch.

An effective product launch checklistis developed only after establishinglaunch goals and then choosingthe best strategy to support them.The checklist will change fromlaunch to launch, adjusting toaccommodate the strategy. Productsearly in their lifecycle, which are

undergoing significant change, willsee a more dynamic process than amature product with an establishedcustomer base undergoing only incremental updates.

ACTIONOnce launch goals are established,

ormulate the launch strategy andthen de ine the deliverables.

Step 3: The launch plancontains unrealistic timeframand expectationsOptimism is wonderful but it canblind teams to the realities of constraints and capabilities withinan organization. Its wise to evaluatethe organization within the contextof the product being launched toidentify readiness gaps. This is morethan just getting the product ready.It means the entire organization isready to market, sell, deliver andsupport at a level that can achievethe launch goals.

Widget Tech was planning tointroduce a new product to market.The product was a departure fromthe typical products Widget Tech

developed and would be sold to anew set of buyers. The company wasexcited about the new potential forrevenue growth. However, the launchwas a fiasco and it became apparentthe launch goals were unrealisticand the change was too much for thesales channel to absorb within thetime allocated.

The key is to assess the organizationobjectively and not color theassessment with personal bias. This

readiness assessment should providemanagement with a realistic pictureof the risks and provide a plan toaddress them. In some cases it willbecome evident the launch goalsare too aggressive and will needto be adjusted.

ACTIONEvaluate launch goals against theorganizations ability to execute.

Then develop an action plan to ithe readiness gaps.


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Step 4: Sales enablementtraining is based onproduct featuresSales enablement training is oneof the most critical components of a successful launch. Unfortunately most training is packed withinformation about the productemphasizing the newest features,the schedule of the marketingprograms, an overview of salestools, and a product demo.

This type of training lacks any insight or information to helpindividual salespeople achieve theirsales quota. Successful salespeoplesolve problems for their buyers,they dont sell features. Inevitably some of the product features

your buyers find most valuableare not necessarily the newestones or the ones you think areimportant or cool!

Salespeople need to know whatproblem the product solves,

which buyers have the problem, what criteria they use to make abuying decision, and how to havea conversation with those buyers ina way that results in a purchase.

ACTIONBecome an expert on howand why your buyers buy.

Step 5: Significant effortis spent creating collateraland sales tools for peoplewho never read itNinety percent of sales tools arenever used by salespeople, yetmarketing teams keep producingthem. They also include a staggeringamount of gobbledygook. Doesit really matter to your buyer that

youre the leading provider of anything or that your software isrobust? Maybe; but it dependson the buyer, not your ego.

Part of the problem occurs as aresult of blindly following a launchchecklist which serves as a proxy for a launch strategy. MarketingCommunications becomes a factory producing a collection of marketingmaterials thats a wishlist fromthe sales team.

But, solidly anchored in launchgoals, a clear strategy, and a deepunderstanding of buyers, MarketingCommunications has the context tobuild the collateral and sales toolsthat influence buyers throughoutthe buying process.

Note: in this context, collateralis designed for prospects andcustomers, sales tools are createdfor the sales team.

ACTIONFocus on gaining a deep

understanding o your buyers,then build collateral and salestools to in luence them through

the buying process.

Step 6: No single personis responsible for drivingproduct launch resultsMany business-to-business (B2B)organizations have just one windowof opportunity to launch each year.

Accountability for driving resultsis fundamental to the success of a launch, but too often centralaccountability is assumed to be inplace when its really distributedamong several individuals.

Development does their part andthrows it over the wall to Marketing.Marketing does their part andthrows it over the wall to Sales.

When the launch fails, those inone group will confidently statethey made a solid contribution andblame the others.

A successful launch takes more thanmerely coordinating the completionof tasks among departments. It takesan individual who can drive resultsthroughout the organization. Alaunch owner provides a single pointof accountability, ensuring productlaunch planning and execution hasthe high priority it deserves.

Getting involved as early as possible,a launch owner can collaborate

with the management team toestablish launch goals and thestrategy needed to achieve them.

With goals defined, a launch ownercan assemble and lead the mostappropriate cross-functional launchteam. Regardless of their current jobtitle, the launch owner needs strongleadership skills and the confidencethat management will support them.

ACTION Assign the responsibility or achiev

the launch goals to a launch ownerand provide them with the lexibiland resources to make it happen.



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Step 7: The launch planis based on hunches, notmarket evidenceHunches may be great for gamblingbut not for a successful productlaunch. Hunches are guesses basedon gut feeling not market evidence.

Your hunch says you can stealcustomers away from your primarycompetitor. Its exhilarating to dothis, but would you bet the successof your launch on this strategy? Youmight, if you have market evidencethe competitor is in a weak position,or is failing to provide adequateservice to their customers.

Suppose your marketing team is planning to exhibit at a tradeshowto announce your new product. If your launch goal is to build salesvelocity, how would you know if thisis the right tactic? You would if thereis market evidence enough buyersof the kind you need will be inattendance.

Market evidence helps mitigate therisk that a hunch will be wrong. Ithelps make sound business decisionsand develop a launch strategy basedon market facts rather than intuition.

With an initiative as important asa product launch there is no roomfor guessing.

ACTIONMake launch planning decisions

based on market evidencenot guesses.

Step 8: The launch planmimics your competitor

Just because one organizationchooses a particular launchtactic doesnt mean it will workfor another. What may seemlike an easy option is to mimic

your competitor. However, thereare too many factors in play toguarantee the same tactic will haveequivalent outcomes. Mimicking acompetitor also assumes they aresmarter than you.

Choosing to mimic a competitoris the result of inexperience or alimited launch planning window.Its easier to copy something thatappears to be successful than it isto develop a sound plan based on

your own capabilities. Mimicking

a competitor can lead to lostmarket opportunity, misdirectionof resources, and loss of focus.

The context competitors use for agiven launch could be completely different than the context of yourproduct launch. Due to strongbrand equity, companies like Applecan choose tactics that will workbrilliantly for them, but may spelldisaster for your company.

ACTION An intimate knowledge o buyers

and the buying process provides thebest guidance or the most e ective

launch tactics.

Step 9: Existing customersare not adequately consideredin the launch planIts staggering how many

organizations fail to recognize theimpact a new version of a productcan have on existing customers.Theyre so focused on acquiringnew business, they forget about thecurrent customer basethe onestheyve worked so hard to acquireand nurture.

A new customer has anunderstanding that getting from

where they are today to fully deploying your product will likely take some work on their part.However, existing customers dontshare this expectation. Theyvealready made the investment andfeel a transition to a new versionof the product should be relatively painless. They trust you will takecare of them.

Your product has been verysuccessful and gained marketshare. To grow revenue, youvediscovered an opportunity in anadjacent market segment. But inorder to enter this new segment,radical changes must be made tosupport critical capabilities expectedby this new market. However, the

cost of supporting two products is prohibitive so you merge the two setsof capabilities into one product.

The launch of the updated productattracts customers in the newsegment but existing customerswont migrate to the new version.The impact on their business is just too great.

When the pain of migrating to anew version of a product (from thesame vendor) is perceived to beequal or greater than the migrationto a competitors product, customers

will often evaluate competitiveofferings. At best they may delay. At

worst they switch to the competitor.This could spell disaster for yourproduct launch.

ACTIONEnsure the migration to a new

version o your product is smoot

and straight orward orcurrent customers.

?? ??

Is Your Product Launch Doom


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Step 10: The launch team isnt a teamHave you ever been responsible for a productlaunch and felt like you were the only one doingthe work?

Product launch is a team sport involving a range of expertise. No single individual can possibly knowall the details, especially in large organizations. Thisnecessitates the creation of a cross-functional launchteam, where individuals can contribute their uniqueperspectives and experience.

The value of successful cross-functional teams is well documented, increasing exponentially withthe size of an organization. However, so does thecomplexity of driving results.

Breakdown occurs when the launch team isnt really a team at all. Its a collection of individuals from

various parts of the organization impacted by thelaunch, but whose management doesnt encourageor reward their participation in the team. Soundfamiliar? Why would a launch team member put inthe hard work to make the launch successful if itsnot deemed important by their manager?

The launch team consists of three distinctroles. The launch owner is responsible fororganizing and driving the launch team.The launch team members areambassadors from their respectivefunctional areas. An executivesponsor helps break down barriers,serve as a mentor and acts aspolitical muscle.

ACTIONMake participation in a cross-unctional launch team a priorityand reward the contribution.

Dave Daniels is an instructor for Pragmatic Marketing with more than 25 years of experience. He specializes in product marketing and product launch, with an emphasison effective go-to-market strategies and execution. His extensive background includesdevelopment, sales, product management and product marketing, with a global

perspective of the entire product launch process. He speaks at many industry eventsabout launch best-practices and writes the Launch Clinic blog. Contact Dave at [email protected]

Are you ready to launch ?I

DontYes No Know

Were you happy with the resultsof your last product launch?

Is your team clear about theirlaunch roles and responsibilities?

Are launch goals established andcommunicated to your team?

Do you have a designated launchowner?

Is the approach to product launcha team effort?

Does your launch team follow

a proven launch process?

Do you consider different launchstrategies for each product launch?

Do you collaborate launch planningamong functional areas?

Is your team learning from eachlaunch experience?

Do you identify and address

readiness gaps before launch?

Each yes gets you closer to a successfulproduct launch. Each no or I dontknow gets you further away fromsales velocity.

If your company is like many others, youwill have the opportunity to launch onlyonce this year, make it the priorityit deserves!


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Are your product launch efforts focused on deliverables rather than results?

Launching a product is more than following a simple checklist. A successful product launch is theculmination of many, carefully planned steps by a focused, coordinated team. Even good products canfail because of organizational issues, misunderstanding of roles and responsibilities, and a lack of astrategic approach to guide efforts.

Learn a repeatable product launch process to shorten the launch planning cycle, get the resourcesneeded, and know what to expect at every step.

Understand the seven product launch strategies your team can useto maximize sales velocity.

Measure product launch progress with indicators that identify unforeseenissues before they become big problems.

Product Launch Essentials Plan and execute a successful product launch

Download a complete agenda and register at PragmaticMarketing.com/seminarsCall(800) 816-7861 to conduct this seminar at your ofce

Get a free e-book at

PragmaticMarketing.com/launch B y D a v i d

D a n i e l s

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In a rapidly changing business climate theallocation of resources and budgets are closely tied to a departments ability to get short termresults. If you are a vice president, director orteam leader for a product management function,one of the biggest challenges you face today is howto demonstrate the team is making a significantcontribution to top line or bottom line targets.The pressure on budgets and resources from

executives has forced a tighter link betweencurrent investments and near term results.

If you cant measure your teams effectiveness,or if you are focused on the wrong metrics, yourheadcount and budget allocation could be at risk.

In the 2008 best-selling book, Tuned-In: Uncoverthe Opportunities That Lead to BusinessBreakthroughs by Craig Stull, Phil Myers and DavidMeerman Scott; the authors point out that many companies force employees to measure and trackthe wrong thing which leads to out of synch or

tuned-out behaviors.

In this economy, the best way a productmanagement team can establish its value to thecorporation is by using a reliable set of outcome-oriented measurements that demonstrate bothperformance of the product(s) and effectiveness

of the role. The stakes are high! A productmanagement function that demonstrates a directcontribution to the companys income statementand uses objective measurements to gauge theireffectiveness and value to the company will havemore influence shaping the product strategy

and the roadmap.

The fact there is increased emphasis onmeasurements, metrics and alignment withcorporate goals during this business cycle is nota surprise. What is intriguing is the number of product management leaders acknowledgingthis focus will continue after growth returns tothe industry. This is in part because CEOs needbetter risk mitigation and are demanding morepredictability in all aspects of the business.

At a recent ProductCamp industry event, a session

on Metrics-driven product management was filled with product management team leaders, directorsand VPs. All of the attendees expressed seriousconcern about the need to establish better linkagesbetween the activities of product management withbroader company results such as revenue, productmargin and profits. Very few challenged the soleuse of these conventional corporate measurementsas the gauge for product management effectiveness.

Success in building high performance teams begins with using measurements that give visibility aboutthe overall effectiveness and efficiency of the team.

The key is finding the right measurements.

What are the best measurements to monitorthe effectiveness of product management teams?

What are the best practices measuring the health of products? How to demonstrate value and alignment

with larger corporate goals?

Measurement-DrivenProduct ManagementMeasure only what matters mBy Mike Smart

The problem with most measurements isthat too many companies have trained theiremployees to measure the wrong things.

Craig Stull, Phil Myers and David Meerman Scott in Tuned In


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Measurements and metricsThe use of measurementsand metrics seems like astraightforward distinctionbut deserves some discussion.These terms are often usedinterchangeably, yet have very different applications. A moreformal definition of the termsmeasurement and metricgives us a common language

to move forward.

Metric: A measuring system thatquantifies a trend, dynamic, orcharacteristic. Metrics encourageobjectivity. They make it possibleto compare; they facilitateunderstanding. Think benchmarksstatistics and predictive indicators.

Measurement: A way of monitoringand tracking the progress of strategicobjectives. Measurements can be

leading indicators of performanceor lagging indicators. Commonmeasurements such as productrevenue, profits, product marginand product adoption rate are oftenreferred to as key performanceindicators or KPIs.

But, what type of measurementsto use and how can they be usedto accurately express performanceand ultimately give managementthe ability to predict results?

There are three types of measurement that are necessary to create reliable performanceindicators; rearview, operationaland activity-based. All key todeveloping an effective productmanagement organization. But the

degree to which a company adoptsa measurement driven approach todrive the business depends on thecompany culture.

Rearview measurements

Pragmatic Marketings 2009-2010 Annual Product Managementand Marketing Survey showsperformance in classical financialmeasurements such as productrevenue, product margin andprofitability are most commonly used to determine the successof product management. Thesemeasurements are rearviewbecause they are lagging indicators;meaning they cannot drive theperformance of people, processes

or products. Product managementteams that focus solely on thesemeasurements usually struggleto establish clear value to thecompanys goals.

Why do so many companies rely on rearview measurements toassess the effectiveness of productmanagement? Because thosemeasurements are easy to assignand consistent with the high levelfocus of the executive.

These rearview measurementsare the natural tools of top-down goal setting. It iscommon for CEOs to pushthese MBOs (managementby objective) down to productmanagement. There is valuein using rearview measurements;primarily to identify historical profitleaks such as:

Product revenue growth

Profitability Cost of sales

Product margin

Rearview or financial measurementsare part of the common language forcompanies. Product Management

will be ultimately judged by thefinancial success of the product,but there are consequences withputting too much emphasis onthese measurements.

We learn too late what is working well and what is not

Focus on rearview measurementscan drive product managers tothe wrong behavior

Product managers are heldaccountable for outcomes they have little or no control inachieving

A solid understanding of the key financial indicators for productsis important but its not enoughto ensure a successful product oran effective team.

I you cant measure it youcant manage it.

The Balanced Scorecard by Robert Kaplan and David Norton

The Pragmatic Marketer Volume8, Issue 2, 2010 19

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Operational measurements

Operational measurements are the measurementsbehind the measurements. These are leadingindicators for most organizations, because they can

drive and create outstanding financial results. Ideally VPs and directors of product management interpretthe company strategy and align with key financialmeasurements by emphasizing relevant operationalmeasurements. These can be the key ingredientsof a high performing product management team.Clear and relevant operational measurementsenable better focus on the team and increase theprobability of product and market breakthroughs.If we understand the relationship between specificoperational measurement and the financialmeasurement, they bring more predictability to thecompanys financial results.

Establishing and using operational measurements toevaluate the effectiveness of product managementand the health of the product is critical becauseit bridges the gap between company strategy andexecution.

A companys operational measurements are howhigh-level goals become grounded. They becomethe vital few for the product management team.

Relevant operational measurements include:

Market sensing knowledge of market problemsamong customers, evaluators and potentials

Speed-to-market putting the right productin the right market segment faster thana competitor

Product adoption driving the uptake ratein a market at a lower cost and shorter timethan a competitor

Product launch improving the response ratefrom target buyers with fewer impressions

Customer satisfaction increasing thewilling to recommend percentage of existing customers

A crucial step is to translate the rearview orfinancial measurements into the appropriateoperational measurements. The leader of the product management team must befluent in both the financial and operationalmeasurement paradigms.

Above, we see that linking these measurementsgives the product management team more contextand better insight into their contribution to thecompany goal. It also gives product managementleaders concrete and objective measurement totrack interim results and key milestones.

As an example, speed-to-marketis a metric that can be tracked in several

ways. How fast did we reach the market with new product releases compared tolast year? How many times did we beat thecompetition to market with comparableproduct releases? Where do we rank withinour industry segment? Over time we learn

what effect improving this measurement has onincreasing revenue. Every team member shouldunderstand these relationships and how theirprojects and key activities affect the outcomeof the operational drivers.

Operational Driver Financial Outcome

Speed-to-market Increase product revenue

Product adoption Increase product margin

Product launch Lower cost of sales


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Activity-based measurements

The next step in developing predictablemeasurements is linking activities, performancedrivers and final outcomes.

Activity-based measurements are the execution sideof the measurements fulcrum. While operationalmeasurements are leading indicators to financialresults, activity-based measurements are the tacticaltasks that lead to the desired operational outcome.Using these allows team leaders to identify thecrucial activities that drive the desired outcomes.

Activity-based measurements reduce ambiguity andestablish accountability for all team members.

Activity-based measurements that a productmanager should be held accountable for are:

Onsite market interviews

Assessing impact to customers for existingor future products

Positioning to buyer personas

The table below illustrates how to close the gapbetween specific activities, operational drivers and

financial results.

Properly conducted onsite interviews across the

total addressable market enable discovery of un-metneeds or market problems. Validation of thesemarket problems through surveys demonstrates

what percentage of the market has these problemsand the value of solving them. The data fromthese activities gives product managers the factsto define the next release and a high degree of confidence that the proposed solution is the rightproduct for the right target segment. This productdevelopment approach is fast and more efficient.

Establishing strong links between activity-basedmeasurements and operational measurements may not be easy, but is critical in establishing the valueof product management and to build credibility

within the organization. The key is to developreasonable correlation and monitor the accuracy of these relationships over time.

Activity-Based Targets Operational Driver Financial Outcome

On-site interviews Speed-to-market Increase product revenue

Assessing impact to customer Product Adoption Increase product margin

Positioning to buyer personas Product Launch Lower cost of sales


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Here is an example of how a teamcould establish strong links betweenactivity-based measurements andoperational outcomes.

The annual operational goal forthe product management teamis to improve speed-to-marketby beating competitor A to themarket. What activity-basedmeasurements must the teamleader assign to each productmanager to ensure this goal isachieved by the end of the year?

Consider these:

Conduct Strength, Weakness,Opportunity and Threat (SWOT)analysis against Competitor A

Complete customer impactassessment of Competitor As products vs. ours

On-site customer visits tovalidate Competitor As perceived product gaps

Complete Market RequirementsDocument (MRD) withCompetitor A as key theme

Deliver 100% of somethingahead of Competitor A

One caution to the team leader make sure the sum of these activitiesis greater than or equal to one ormore of the team goals. This linkingcan provide the ability to benchmarkand propose metrics that havepredictive value.

The key to success with thisapproach is to continuously reviewdata and trends to ensure themeasurement remains relevant.

Best Practice MeasurementsShare of hearts, mindsand markets

Most product management leaders would benefit from the ability torigorously assess existing projectsand new opportunities, identifyingpotential risks. This approach wouldguide investment and allow VPs anddirectors to evaluate outcomes andreinvest to maximize contribution.The enhanced visibility wouldenable product management leadersto defend the allocation of resources

with measurements that are tightly linked to the companys income

statement. As a leader of a productmanagement team, what should

you measure?

Initially two things: productperformance and productmanagement effectiveness.

These are different but equally critical dimensions of the productmanagement process. Team leadersmust monitor people, process andmarket success for the productlifecycle. To be successful, all threemust be continually assessed.

Must be relevant

The most important outcome fromProduct Management are financialresults, but product managementleaders must translate the financialresults into performance driversthat lead to the income statementoutcome. Until a clear linkagebetween actions and outcomesis established the measurementsare theoretical.

When it comes to setting targets forindividual product managers thereare best practices to follow.

Look for connections betweenoperational measurements andactivity-based measurements thatmay not seem obvious at first.

Question your current assumptionsabout the business and what really drives product performance.

Require transparency

Initiating a performance measurementprogram is a commitment tochanging the way a team operates.The biggest change is a commitmentto complete transparency.

In some companies, ProductManagement has accountability forthe operational goalseach of theseare translated into product specificobjectives and measurements.The product management leadersmust defend key measurementsand performance at theproduct line level.

Must impact financial results

In a down economy, CEOs arepressured to emphasize near termresults and near term execution

that impact the income statement.Product management leadersmust be aware of potentialshifting priorities and if your key measurements are trending badly,early intervention is critical.

The team leader using thismeasurement system must havea dashboard view of products,projects, processes and people. Thisis the only way to focus on whatmatters most and to continuously

refine key measurements. It alsoallows the team leader take actionbased on insights gained oremerging trends.

However, the proper use of measurements must go beyonddriving short-term financial results.The real potential is in changing the

way Product Management thinksabout its role and value to theorganization.


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Ultimate goal Every metric, whether it is used, to evaluate

uture strategies, or simply to take stock, willa ect actions and decisions.

From Metrics: You are what you measureEuropean Management Journal

The long term benefit of Product Managementbecoming measurement-driven is higher teamperformance, improved predictability and increasedcredibility. The ultimate benefit is developing theability to reliably create outstanding products andmarket breakthroughs.

Can Product Management operate with this high levelof maturity, using a reliable measurements and metricssystem with more predictable results in a company?

This holy grail of product management performanceis doable, but often many cultural and process gapsmust be addressed first. An organization fosters ameasurement-driven culture by reinforcing otheraspects of the process, such as tightly couplingrewards, recognition, compensation and promotionto attainment of operational results. Does yours?

Mike Smart is an independentconsultant working with private equity firms to increase the value of their portfolio companies by implementing product management and productmarketing best practices. He has a passion for identifying key metricsthat drive company performance.

Mike brings more than 25 years of industryexperience in a variety of leadership roles. Theseinclude Senior Vice President of Operations,

VP of Product Management & Development, VPof Product Management and VP of Sales.

Most recently, Mike was an instructor andconsultant with Pragmatic Marketing wherehe worked with medium and large enterprisesoftware companies to teach and implementthe Pragmatic Marketing framework.

Contact Mike at [email protected]

Visit the online community atPragmaticMarketing.com

Review 10 years of Annual Product Management and Marketing Survey results

Attend a webinar by one of todays industry thought-leaders

Read hundreds of articles on productmanagement, marketing and leadershipstrategies

Read blogs from Pragmatic Marketingthought-leaders and other industry experts

Stay connected with your industry peersby joining a local Product Management

Association

Read profiles of companies who haveachieved success using the PragmaticMarketing Framework

Participate in online networking withLinkedIn and Facebook groups

View a list of recommended books and software tools for product managersand marketers

Stay current windustry best pr

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We can only design solutions for people when we havea deep, detailed knowledge of those peoples needs. Webuild upon our prior knowledge and experience to designand develop better products. Each new generation ofsolutions improve based on market and customer feedback.

Defining and Designing TechnoloBy Sean Van Tyne

[1] Van Tyne, Sean, Easy to Use for Whom: Defining the Customer andUser Experience for Enterprise Software. Pragmatic Marketing, Volume5, Issue 3, 2007

Ignore customer suggestionsSometimes the best way to satisfy a

customers need is to ignore their suggestions.Customers have ideas about incrementalimprovements to their workflow, but if wedevelop something that is truly innovative,our ideas probably wont make sense toexisting customers. 1 Sometimes when wesolve a market problem, our solution may completely eliminate existing workflows,activities, and tasks with a better process.In many cases, customers only know their

way of doing things while we have a broaderperspective across many customers processesand a deeper understanding of technology capabilities. An individual customer doesnot have our aggregated view of the largermarket problem across multiple customersand a deep understanding of technology.

Listening to our customers suggestions may lead to incremental improvement insteadof real innovative market solutions butignoring them all together can produceeven worse consequences! It is by goingout and observing our customers usingour solution that we see how they interact

with our products in their environment.There are many things people never

verbally communicate because they areunconsciously doing them or they do notsee them as important. For example, they may have created special information cheatsheets they need to do their job. I haveobserved numerous customers end-users

who have a spreadsheet on their networkto manage information that could beincorporated into the product and completely change the way they accomplish activities.Most customers do not have the deepunderstanding of technology capabilities.

And, from their perspective, we are, quite

frankly, one of many vendors to them just a part of their overall process andthey think of our products and solutionsin this context.

A deep understanding of our customersneeds is still required to make greatsolutions. But it also requires a deepunderstanding of technology, tools, and of the reasons for our customers activities.


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Understand customer activitiesDr. Donald Norman has suggested

a hierarchical structure of activities,tasks, actions, and operation 2 tobetter understand our customersinteractions with solutions. In thismodel, activities are comprisedof tasks, which are comprisedof actions, and actions are madeup of operations. This activity-centered philosophy is focusedon the activity not the person.If a customers suggestion fails tofit the design model, it should bediscarded. Too many companies,proud of listening to their customers,

will include requested features thatdo not really solve the bigger marketproblems. Only by observing ourcustomers activitiesinteractions

with our productsdo we really understand customers needs.

Successful product designersunderstand their customers activitiesto determine how the solution

will best operate. Understandingthe tasks of the activities helpsunderstand the customersintentions. Focus on activities ourcustomers perform rather than theirrequests. Systems that support theactivities must, of necessity, supportthe people who perform them.Successful products are those that

fit gracefully into the requirementsof the underlying activity, supportingthem in a manner understandable

by their target customer. Understandthe activity, and the solution isunderstandable.

Define who, why, what, andhow: roles, goals, scenarios,and activitiesThe product manager must have aconcise vision for the product they can clearly articulate to the productdesigners. Put the customers and

users activities in context of themarket problem the solution issolving. Markets are made upof segments. We must be able todefine our market segmentationsin terms of their needs in contextof the problems we are solvingfor them. Both demographic andpsychographics help to developsegmentation profiles. 3 Consider thestrengths and weaknesses of thecompetitions solution compared to

your solution along with how the various customers goals, process workflows, activities, and tasks aresimilar and different. Rememberthat innovation sometimes meanslooking at a solution in other

markets and adapting it to our own.The solutions vision provides thedirection for the products design.

The product team must follow the vision and not be afraid to ignorefindings. Yes, listen to customers,but know when the findings supportthe vision. Vet assumptions, validatedesign concepts with customers,and evaluate the solution withcustomers end-users. Reviewmarket segmentation demographicdata and interview stakeholders,customers, and users, in order togain insight into their goals. Agoal is a result one is attemptingto achieve. Observe the customersand users using the solution in theirenvironment and develop diagramsof the various customers workflows

and note where the goals andunderlining activities are similarand different.

Group your customer and user by similar roles based on their goalsand the type of activities they perform. A role is a set of connectedbehaviors. Usually people with thesame role have similar job-relatedresponsibilities, duties, and goals.

Once the various roles and goalsare understood, think throughthe scenarios needed to realizethe goals. Scenarios describe ausers interaction with the solution.Scenarios are useful to ProductManagement to define businesscases and useful for Product Designto define user interface design.

Determine what activities areneeded to complete the goalsby roles. An activity is a specificbehavior or grouping of tasks.

Develop a diagram that illustratesthe activities. An activity diagramshows activities and actions todescribe workflows.

[2] Norman, Don, Human-Centered Design Considered Harmful, http://jnd.org/dn.mss/human-centered_design_considered_harmful.html

[3] Bean, Jeofrey and Van Tyne, Sean, Market Aligned User Experience Seminar, October 5, 2008, Del Mar Doubletree, San Diego, CA

People

Role

Goal

Scenario

Technology

D E F I N E

D E S I G N

Who:

Why:

What:

How: Activity

Tasks

Actions

Operations


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Design activities, tasks,actions, and operationsProduct designers have tools they useto define activities, tasks, actions, andoperations such as activity diagrams,

wireframes, and prototypes.

Activity diagrams divide the activitiesinto tasks needed to complete the usersobjective. A task is a unit of work. Thetask itself may be a single step in theprocess or multiple steps or sub-tasksthat make up the task. Activity diagrams,sometimes called process flow diagrams,divide the scenario tasks as needed

to convey what the userneeds to do to complete

their goal.

Tasks analysis looks

at tasks as outcomesthat have actions. Actions usually result in some form

of commitment. Forexample, selecting the

OK button in a softwareinterface or pressing a button

on a device that results ina desired outcome. And an

operation is the outcome of the users action. The operationis the program initiated and

yields the results of the usersintended goal.

Product Design developsprototypes to elicit customerfeedback to validate thesolutions activities, tasks, andactions meet their needs.

Wireframes are a quick andeasy way to prototype a designfor feedback. Wireframes area basic visual guide usedto suggest the layout andplacement of fundamentaldesign elements in the interfacedesign. They provide a visualreference for the structureof the screens, define thepositioning of global andsecondary levels of informationhierarchy, and maintain designconsistency. It is a way to visually represent the activities,tasks, and actions.

With wireframes, designers validatethe general workflow navigation,information grouping, informationhierarchy, terminology, labels, and generalinteractions in terms of activities andtasks that need to be complete to meetthe customers goals. Wireframes andlo-fidelity prototypes, in general, shouldbe void of all color, fonts, icons, graphics,etc. to keep the focus on the overall

workflow, activities, tasks, and generalinformation design.

When solving problems for the broadermarket, these prototypes allow youto validate where various customers

workflow and content overlap and differ,and start thinking about the right designsolution to support the differences in their

workflow, activities, tasks, and content.

Once youre confident you understand various customers workflow, activities,and tasks, its time to develop visualdesigncolor scheme, fonts, iconography,branding, and all graphic elements. Visualdesigners develop the visual designelements that support the companysbrand and enhance the ease of taskcompletion and efficiency.

Medium-fidelity prototypes are developedbased on wireframes and visual design.These prototypes encompass screenflow and interaction. Interaction Designdefines the behavior of how yourcustomers and users interact with yoursolution. They focus on the tasks thatneed to be completed and the actionsassociated with the task and underlineoperation. Interaction design is focusedon making products more useful, usable,and desirable.

Work with customers and users toconduct reviews of prototypes forfeedback. Conduct usability evaluationsto measure effectiveness, efficiency,and satisfaction. Be sure to measuretask completion, time and task, and theemotional response to your solution.


De ining and Designing Technology or People

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Pragmatic Roadmapping

online or onsite at your compa Align your product strategy with the mDo you need a practical and repeatable way tocommunicate product plans, strategy and vision?

The online Pragmatic Roadmapping is acomplete one-dayseminar, presented in three parts you can watch all at once orspread over several days. Each session includes instructor-led,hands-on exercises to help you dene, plan and complete

your roadmap.

Align and focus the organization around the market not just your products.

Identify which projects to fund based on available resources andcompany strategy.

Communicate the roadmap internally & externally with just theright detail for each audience.

Download a complete agenda and registPragmaticMarketing.com/seminars

Call(800) 816-7861 to conduct this seminar at your

Win in the marketplace We can only design solutions forpeople when we have a deep, detailedknowledge of those peoples needs.

Just listening to our customerssuggestions only leads to incremental

improvement instead of real innovativemarket solutions. It is by going out andobserving customers using our productsin their environment that we gain deepunderstanding of our customers needsthat is required to make great solutions.

Successful products fit gracefully intothe requirements of the underlyingactivity, supporting them in a mannerunderstandable by their target customer.Understand the activity, and the solutionis understandable. With an activity-centered design, focused upon theactivity rather then the person, ensures

we develop innovative solutions that win our marketplace.

Sean Van Tyne is the UserExperience Director forFICO where he providesleaderships for teamsacross the US, UK, andAsia. Prior to FICO,Sean was AVP of User

Experience for LPL Financial wherehe helped define new market segmentsand develop the product management,iterative design, and agile development plan. Prior to LPL, Sean was Directorof User Experience for MitchellInternational. Prior to Mitchell, Sean wasDirector of Product Design for Medibuy.Sean is the current President of UX SIG(www.uxsig.org); on the Executive Boardof UXnet (www.uxnet.org); and advisoron numerous professional and corporateboards. Visit www.seanvantyne.com

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Why should you sunset?Sunsetting is the process of pulling aproduct from market. The term canalso be applied to removing obsoletefeatures from a product. Sunsettinginvolves making the business decisionto remove the product or feature and

then communicating the decisionto customers and sales channel.Sunsetting a product removes theproduct from the sales channel;sunsetting a feature removes thefeature but keeps the product.

In either case, the primary reasonfor sunsetting is that the cost of development and maintenance exceedsprofit. There may be other reasons butin the end, sunsetting is a businessdecision, not a technical decision. Lookat the revenue from maintenance andthe cost of maintenance. It should bea pretty easy decision.

Making the case A quick estimate of productprofitability shows whether the productmakes good business sense. Determinehow many people are staffed on theproduct in development and support.Thatll give you a sense of the cost.Then get Finance to provide annual

revenues for licenses and maintenance. Voila! You have a definition of profit.

Some companies continue to supportobsolete products even though they have no developers or support staff that know anything about the product.

You know that will bite you in the end.If your product isnt making profit, itstime to kill it.

Suppose you need to pull a feature? A SaaS or hosted solution should make

this a snap! Not only can you easily pull the feature, the product itself cantell what features are being used. Forthe rest of us, a quick customer survey

will probably do the job. Survey a fewdozen customersor maybe all of themand ask if they use the feature.One question. Yes or No? Resist thetemptation to extend the survey forsome other marketing or sales objectivebecause you dont want to burden asurvey with too many questions.

Dont Let theSun Go Down

Most product management activities and processes are about

creating, delivering, and maintaining products. But what about

products at their end-of-life? Not much has been written on this

topic so there arent many resources available.

We often hear I want to sunset product features, but a small

handful of my customers are holding me hostage and I dont

know how best to move forward.

Techniques for sunsettingor retiring productsand features

By Steve Johnson


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And dont forget about web stats. Your web master can easily tell which operating systems andbrowsers are being used on

your website. So if you want todiscontinue support for an obsoletetechnology, you can quickly determine what percentage of

your customers are affected.

You need to support yourcustomers environments but notone customers environment; that is,

you must support the environmentsof a statistically relevant set of customers. Most industries upgradequickly while others continue touse old platforms. Your customersmay need continued support fora platform long after the vendorhas dropped support. Check the

statistics on your customer-focused website to identify which operatingsystems are being used. Microsoftis very upfront about the lifecycleof their operating systems. Go tosupport.microsoft.com and searchfor lifecycle to see exactly whensupport will be discontinued for

various products.

The tricky thing of course isknowing what is right for yourproduct. Sure, nobody at yourcompany uses obsolete technologiesbut do your customers? You mightbe surprised how many people dontupgrade their operating systems orbrowsers. They just use whatevercame on their computers. Is thattrue for your customers? Findout before you assume that yourdevelopers tech environment issimilar to your customers.

Factors to considerwhen sunsetting

A product or feature should beremoved from the market when itsno longer profitable to maintain.There may be other considerationsas well. To your colleaguesoutside the technical part of theorganization, there seems nodownside to keeping productsaround but keeping products pasttheir prime confuses customers,

distracts developers, and annoyscustomer support. A trouble ticketrelated to a product on its last legspulls time and attention from thecompanys core business. Customers

will wonder whether to buy theold product or the new, and willcertainly question why they are

paying for maintenance on a productthat you clearly are not maintaining.Sales and Marketing will care aboutthe distraction when they realizethat maintaining an old productcomes at a cost of not producing orupgrading a new product.

Strategic fit

Beyond the profit factor, olderproducts may not align withcompany strategy. If your company is embarking on a new strategicdirection, older products willconfuse the market and your ownportfolio strategy.

Portfolio fit

Its a bad idea to have twoproducts that appear to do thesame thing. Look at your productportfolio across the company and ensure there is no confusionabout capabilities. If you have twoproducts in the same category, one

of them should probably be retired.

Contractual commitments

Many product managers discovercontractual commitments withcustomers that have to be workedout with your legal team. Mostcustomers are reasonable; they understand that youre runninga business. But understand whatthe contractual commitments areand discuss alternatives with yourteam. A great solution for many customers is a free upgrade to yourcurrent product in the category.Since many customers do notupgrade for financial reasons,

you may find that the contractualcommitments disappear if you canmake upgrading free or at leastinexpensive.

Market factors

Continuing to maintain old productimpacts the markets perception of

your company and portfolio. Youprobably dont want the reputationof being the company where oldtechnology goes to die.

Technology

Technology does become obsolete.It doesnt make sense for mostcompanies to support OS/2,

Windows 3.1, DOS 3.3, old versionsof databases, platforms, browsers,and so on. Keeping the code aroundmakes it cumbersome to maintainand often slow to use. Refactoringfor the purpose of improvingproduct performance is hamperedby obsolete or unnecessary code.

Impact to customersChange is often perceived asnegative by many of your customers.Some, of course, have already upgraded and make every attemptto stay current. Others would ratherstick with what works and not haveto re-implement anything.

Any change has a customer impact

so explore options to alleviate thestress and costs of change. Freeupgrades from the old to newproduct, automated conversion of data and scripts to the new platformand assisted conversions using

your professional services teamare all methods to make it easy fora customer to change. Imagine if

you had to format your hard driveand reinstall all your data every time Microsoft put out a servicepack! Thats what it feels like to

your customers when they have toupgrade from version 6 to version 7.


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Communication to customersThe real key to sunsetting productsis to get customers to understand

why youre doing it and how itaffects them. Explain the businessdecisions. Solicit their ideas onhow to best make the transition.

Explain their options for convertingthemselves with automation or with your assistance.

One trick is to do positioning.Those who have attended PragmaticMarketings Practical ProductManagement seminar know howto do this. You want to crystallize

your thinking. Any time you plan tocreate a marketing program or salestool, you start with positioning. Sodo a positioning document for theend of life, too.

This notification is usually done vialetter or email to the buying contactin the client site.

Heres an example from FusionOne:

Several months ago, we informedusers of our free FusionOne Basicservice that we would no longerbe supporting the free service,and urged users to upgrade toour fee-based FusionOne Plus

service. Therefore, effective March31, FusionOne will permanentlydiscontinue the FusionOne Basicservice. After that date, the Basicservice will no longer be available,and any data stored on FusionOneservers will be permanentlydeleted. We will not be able to provide access to that data in any form after March 31. We stronglysuggest that Basic service usersretrieve and/or delete any datastored inside the FusionOne service prior to this date.

We encourage you to learnmore about FusionOnesother service offerings formobile phones: MightyPhone(www.mightyphone.com)and MightyBackup(www.mightybackup.com).

We sincerely appreciate your support and regret anyinconvenience this necessaryaction causes you.

Most of all... be clear. Nobody likesambiguity. You dont want themthinking okay, what does this really mean? Tell them your decision, tellthem their options, and give thema switchover date.

Be sure youve got executive

support for the decision. For somecustomers, sunsetting a product willspark a phone call to their salesrep, asking for an exception. Andthe sales rep thinks he doing thecustomer and the company a favorby saving this client. You needto be able to say with assurity thatthe product is being discontinued.Period. No discussion.

Opening up the account

One negative aspect of discontinuinga product is that it invites the clientto look for alternative productsfrom other vendors. After all, if Im going to have to re-implementanyway, maybe I should look atsome other products. Discuss with

your sales management approachesthat encourage customers to upgraderather than switch.

However, if youre obsoletinga product and dont have anupgrade path within your owncompany, youll need to recommendproducts your customer shouldconsider, particularly thosefrom your partners portfolios.

Again, a discussion with salesmanagement goes a long way

in reducing the thrashing thatoccurs when a customer startsevaluating alternatives.

Un-launching the product

Okay. Youve done the profitability

analysis. Youve decided how tocommunicate to the customers andhelp them move. Now you have toun-launch the product. Rememberall the things you did to launch theproduct? Now we have to un-do itall. Youve got to revise the web-site to say This product has beendiscontinued and send them to aproduct page for the replacement oralternative. Youll have to remove itfrom the price list. What else will

you have to revise or remove? Lookto your current launch plan for any product, walk-through each itemand create an un-launch plan. Thisis probably one of those places

where a team can see items asingle person cannot.

Obsolete products confuse thecustomer and sales channels.Obsolete technologies becomeincreasingly difficultorimpossibleto maintain. Most of all,obsolete products are not profitable.

And they distract you and your team

from focusing on the companysnew initiatives. Help your customersswitch from old to new. Put togethera team, divvy up the areas of responsibility, and make it happenso you can get back to workingon tomorrows products insteadof yesterdays.

Steve Johnson is a recognized thought-leader on the strategic roleof product management and marketing. Broadly published and a frequent keynote speaker, Steve has been a Pragmatic Marketinginstructor for more than 10 years and has personally trainedthousands of product managers and hundreds of company seniorexecutives on strategies for creating products people want to buy.

A biting sense of humor, credible and feels my pain as a product managerare just some of the words attendees use to describe the experience of being taby Steve. He is able to convey his experiences of living the life of a product manin a unique and entertaining way.

Steve is a popular keynote speaker at forums throughout North America andauthor of many articles on technology product management. His ebook on productmanagement has been downloaded thousands of times. He also blogs on the topicat productmarketing.com. Contact Steve at [email protected]


Dont Let the Sun Go Down: Techniques or sunsetting or retiring products and eatures

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Call (800) 816-7861 or go to PragmaticMarketing.com to register!

Seminar Calendar

Practical Product Management Requirements That Work Effective Product Marketing

Effective Product Marketing

Introduces a framework that gives product managers thetools to deliver market-driven products that people wantto buy. Focuses on the practical aspects of juggling dailytactical demands of supporting the channel with strategicactivities necessary to become expert on the market.May 11 - 12 (13)* ............. San Francisco (Burlingame), CAMay 12 - 13 (14)* ............. Tampa, FLMay 24 - 25 (26)* ............Minneapolis, MNMay 25 - 26 (27)* ............ Toronto, ON, CanadaJune 9 - 10 (11)* .............. Vancouver, BC, CanadaJune 14 - 15 (16)* ............ Austin, TXJune 14 - 15 (16)* ............ San Francisco (Burlingame), CAJune 21 - 22 (23)*............Boston (Bedford), MAJune 28 - 29 (30)*............ Raleigh (Durham), NCJuly 12 - 13 (14)* ............. Indianapolis, INJuly 12 - 13 (14)* ............. San Francisco (Burlingame), CAJuly 19 - 20 (21)* .............Ottawa, ON, CanadaJuly 19 - 20 (21)* ............. Portland, ORJuly 26 - 27 (28)* ............Newark, NJAugust 9 - 10 (11)* ........... Boston (Bedford), MAAugust 9 - 10 (11)* ........... Toronto, ON, CanadaAugust 16 - 17 (18)* ......... San Diego, CAAugust 23 - 24 (25)* ........Denver (Littleton), COSeptember 13 - 14 (15)* ... Montreal, QB, CanadaSeptember 27 - 28 (29)* .. Minneapolis, MNSeptember (TBD)............... Atlanta, GASeptember (TBD)............... Baltimore, MDSeptember (TBD)............... San Francisco, CA

*Day 3 is Requirements That Work

Delivers practical tools and processes marketing, industry marketing and marcommunication managers who want totheir strategic contribution and align worganization. Learn how to build a repto develop, execute and measure go-tothat ensure product success.

June 28 - 29 ..................Boston (BedAugust 16 - 17 ...............San FranciSeptember (TBD) ..........San Diego

Provides a repeatable method for writing clear requirementsyour team will read and use. It discusses techniques forprioritizing and organizing market requirements andclarifies the roles for team members. This approachenables organizations to deliver solutions that sell.May 13 ........................San Francisco (Burlingame), CAMay 14 ........................Tampa, FLMay 26 ........................Minneapolis, MNMay 27 ........................Toronto, ON, CanadaJune 11 ........................Vancouver, BC, CanadaJune 16 ........................Austin, TXJune 16 ........................San Francisco (Burlingame), CAJune 23 .......................Boston (Bedford), MAJune 30 .......................Raleigh (Durham), NCJuly 14.........................Indianapolis, INJuly 14.........................San Francisco (Burlingame), CAJuly 21 ........................Ottawa, ON, CanadaJuly 21 ........................Portland, ORJuly 28 ........................Newark, NJAugust 11.....................Boston (Bedford), MAAugust 11.....................Toronto, ON, CanadaAugust 18 ....................San Diego, CAAugust 25 ....................Denver (Littleton), COSeptember 15 ..............Montreal, QB, CanadaSeptember 29 ..............Minneapolis, MNSeptember (TBD) ..........Atlanta, GASeptember (TBD) ..........Baltimore, MDSeptember (TBD) ..........San Francisco, CA

Shows how product management can ensure an Agiledevelopment team remains aligned to company strategy.From creating user stories grounded in market problems tomanaging a backlog prioritized with market evidence.

Assess organizational readiness andresponsibilities for a successful pro

June 30 .........................Boston (BedAugust 18 ......................San FranciSeptember (TBD) ............San Diego

iscount is available for groups of three or more.ont see a date or location that works for you? Pragmatic Marketing come to your company! Call (800) 816-7861 for more information.

Living in an Agile World

Product Launch Essentials

May 14 ...........San Francisco (BurlAugust 12 .......Boston (Bedford), M

Vol 8 Iss 2

Documents

Transcript of Vol 8 Iss 2