First principle strategy & decision making of a Product Manager.
The first thing i learnt on starting my Product Management journey is to develop and take decisions based on first principles. A first principle is a “basic, foundational proposition or assumption that cannot be deduced from any other proposition or assumption.”.
First principle thinking helps PMs a lot as companies scale, communicating the rationale behind historical, current, and future product roadmap decisions can be simplified in a way that their team and stakeholders can always stall around and still stay on same page. This enables the PM & all the stakeholders involved to move quickly in the same direction, decouple, and make smart business decisions.
An example of one that we use for our engineering team is that
“all platform features should be like Lego blocks”, meaning that engineers should be able to use any combination of features, libraries, functions and micro-services when building an app. In a way that these Lego blocks are reusable.
First principle strategy of Product Management
first principle strategy can help a PM align their team around what’s most important in a product, I believe all teams thinking similarly will ease the overall process.
The first principle of Product Management can be classified as:
A. Adding value to the product mission: develop a product strategy that maximizes the impact to an organization’s business and engineering mission in a given a set of inputs.
B. Take ownership & accomplish everything through others: PMs do not directly build or operate the product, instead they enable those around them to do it better.
These two principles represent the left and right sides of your brain. The left is defined by logic, research, and rigour. The right is defined by creativity, intuition, and empathy. Great product managers fuse these two principles into all their decisions and everything they do should derive from them.
I wish I had written this first, but honestly I am still trying to learn.
Let’s talk about the Principle A for now.
Principle A: Adding value to the product mission
The focus of all employees in a company should be to fulfill the company’s mission, whether that mission is to earn billions, create social good, or both.
To this end, the vast majority of people in a company are directly working towards providing a product/service to customers: they are building the product (engineers and designers), taking it to market (marketing and sales), or helping existing customers (support).
Product management does nothing to directly build or operate the product for customers. Instead, its core responsibility is to look ahead and inform the builders/operators of the product what the right path is to achieve the goal. That path is also called the product strategy, and the best ones are those that maximize impact to the mission.
Defining the product strategy is a massive responsibility right. Let’s see how does a Product guy will solve this.
I always go on asking and jotting down these three inputs on any problem:
- What is the goal?
- What is the first order thinking & signal?
- People, Money, and Time constraints exist!
PMs use these inputs to form an opinion on the right path that will lead to fulfillment of the business mission.
1. What is the goal?
Everything starts with the goal. If you don’t know where you’re supposed to go, you shouldn’t even move because you’re just as likely to end up further away.
One of the biggest issues I see with PMs is that they don’t take the time to really understand the goal. They may be able to recite the mission statement, but do they understand its foundations? I’m talking about the customer assumptions that led to it, the moral/ethical/design boundaries the company intends to stay within to achieve it, and the vision of the world’s future that it is supposed to live in.
Great product managers incessantly ask hard questions to leadership to understand the nuances — the first principles — that went into defining the mission they follow. The deeper one can understand it, the more precise their path to the goal will be.
PMs also need to know how other teams are also contributing to the effort. Especially in large companies, aligning across all teams ensures that collisions are avoided and — far better — find opportunities for teams to combine efforts and accelerate progress.
Only once a PM is sure they know their company’s goal, and the goals of other teams around them, are they ready to effectively setup their own team’s goals, which must ladder up clearly to the broader mission.
2. What is the first order thinking & signal?
Most plans start out as a straight line to the goal, but the path never ends up as one. It’s impossible to see all the obstacles ahead, and sometimes the goal is so far away you can’t always tell if you’ve drifted off course. To hedge against this, PMs have to listen to their environment to detect, anticipate and course correct the path.
There are two main classes of environment signals you want to seek:
Customer signals are the qualitative and quantitative data sets you accumulate on how customers are using the product. This data is the “ping” from the goal, and when you hear that ping get stronger, you know you aren’t veering too far off course.
Market signals are the “asteroid warnings” that represent shifts in the world that will affect your path. They are the changes in the competitive, political, and socioeconomic landscapes that affect your company and customers.
Constantly listening to the world outside your company walls is a critical input to great product management. And what you hear from customers is the ultimate validation of your achievement of the goal.
3. People, Money, and Time constraints exist for real
How far a rocket ship can go — is decided on how much fuel it holds, the quality of its crew, and its time-constrained ability to leverage gravitation of other bigger celestial bodies. Similarly, product teams are constrained by the money, people, and time.
It all boils down to the product launch
On any given mission, a product team will be constrained by all three of these.
People on a product team often represent the biggest constraint. Too often, that constraint is only thought of as the number of people working on a product (which it can be), but vastly more important are actual skill and experience levels of the people on the team.
Just like you wouldn’t put the rookie class of NASA on its first mission to Mars, there are product scopes that are beyond the ability of some teams. This isn’t their fault, and says nothing of their eventual abilities, but it is something that PMs critically need to understand when figuring out the path forward. To be clear, this applies to the PMs themselves, as well. They need the self awareness to know when they’re biting off more than they can chew. We’ll cover much more on people later in this post.
Money is a constraint that relates to the ability of a team to hire the right people (salaries), enable them to work (overhead like office space), operate the product (servers and support), and distribute it (marketing).
It would be silly to spend all of your money on salaries to hire the best team, but then not have an office for them to work in, or not have a single dollar to pay for marketing and thus very few customers will find the product.
Most companies have abstracted away the overhead, operating, and marketing cost complexities from PMs (so that they can focus on product and distribution), but it’s important that PMs understand that capital isn’t limitless.
Time is the ultimate constraint because unlike the other two, once it’s exhausted you cannot get more of it. Time represents reality. It’s the reality that products that haven’t shipped have yet to produce any value. It’s the reality that competitors are taking market share everyday. It’s the reality that your company will run out of money next month.
PMs must manage time. They must ensure that that they don’t miss big windows of opportunity, make correct business requirements, document precise development requirements, manage backlog with the engineering team, and manage time to grow in a healthy way & foster execution on their team.
The right path (product strategy) is at the intersection of the inputs
When PMs know the goal, understand the environment, and respect the constraints, they have the necessary inputs to build a great product strategy, which sits somewhere in the intersection of those inputs.
Adrian H. Raudaschl | UX collective
My reductionist analogy may imply this is easy, but let me be clear that forming a good strategy is very, very difficult. In fact, despite being confident enough to write this post, I am not confident that I can always find the right strategy in practice. It’s just fucking complex.
The other dimension that I hope comes through from this section is that PMs need incredible breadth to effectively synthesize these inputs into strategy. Knowing enough about engineering, UX, data, finance, organizational design, operations, research, marketing, etc. makes your ability to synthesize these inputs more effective, and thus your strategy will have a higher likelihood of being successful.
I feel many PMs get intimidated by this reality and react by specializing in a domain and/or outsourcing the thinking from a domain to another team (e.g. “marketing will figure out how to distribute it”). I really think this type of thinking is counterproductive, and will limit your potential. As scary as it sounds, it is important that you try to learn everything. Temper the fear that comes with this with the acknowledgement that, at the same time, it is impossible to know it all.
Principle B: Take ownership & accomplish everything through others:
PMs ensure the team is efficient in developing and in a peak state of performance
The parallel for product teams are product development processes. Whether you’re hardcore agile/scrum, “process-less” (note: a process exists whether you choose to acknowledge it or not), or something in between — the coach is responsible for ensuring the team commits to a process that enables them to do their best work. Note that the optimal process will be different for each team and coach dynamic.
PMs take ownership and add value to the process
This is an uncomfortable ownership concept for many PMs, but whenever I see a team that doesn’t seem excited about the work or looks burnt out, I’ll put pressure on the tech lead to foster a healthier dynamic.
This is difficult of course, because people are complicated. We are all motivated to do our best work by different things: some of us need encouragement, some need to be challenged, some need a friend, and some need all three at different times. PMs need to find a way to understand what makes individuals on their team tick — the first principles of their being — and then build meaning and purpose from work on top of those principles.
People management is the ultimate key to success.
The thing about first principles is that nothing else matters in the long run —only adding value does
Exploring the first principles of Product Management reveal that it demands equal effort from the every stakeholder. It’s simple & logical.
Success for Product teams means respecting the first principle decision making and apply them in the process. Create a product strategy that maximizes impact to the mission, adds value to the process and have a mentality to accomplish that mission though the people around you.