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Q & A with Greg Cohen on Lean Product Management

First of all, a big thank you to Greg Cohen for giving a great presentation at yesterday’s webinar. He showed us how lean product management can help us get products to market quickly and successfully. Thank you to everyone who participated and for those of you who were not able to make it, please feel free to watch the replay. Greg has kindly answered the remaining questions that we were not able to cover during our Q&A session.

 

What's a good rate for product failure? It can't be zero for products. (Maybe it could be zero for IT.) Should more than half of products be successful? Or should we lower our success criteria?'

The rate I quoted in the presentation was that 70% of new products fail and that goes to 90% for start-ups.  That 70% number is also similar for IT projects.  From what I have read, the best companies, like Proctor and Gamble, have rates around 50%.  But I think it’s important to look deeper than just failure rate.  Failure is a spectrum.  On one side are large, expensive failures.  Products that absolutely didn’t deliver anywhere near their expectations or pay back the initial investment are pulled from the market, or sold for pennies on the dollar. HPs tablets are a recent example.  More classic examples include Motorola’s Iridium phone system and the Apple Newton.  On the other side of the spectrum are products that underperform.  These products might still be profitable but do not deliver the full return promised in the business case.

Now I don’t like the term “fail fast”.  I prefer to frame it as “succeed quickly.”  Lean product management techniques are designed to let you do just that and reduce the risk and investment along the way.

Regarding lowering our success criteria.  I wouldn’t because lowering the criteria doesn’t actually improve performance.  For product management, performance ultimately ties to realization of the business plan.  To oversimplify the relationship, we as product managers ask executive management for money to build our product and in exchange promise a rate of return.  Product success is therefore performance to plan.  Learning gates let you iteratively develop the business plan and have confidence that it is achievable.  

 

One of the things I notice about breakthrough thinkers is that they are not very linear, and it can be argued that the non-sequiturs and mental (sometimes almost random) twists and turns are important to vision.  Product Management as a profession loves its processes.  How do we reconcile the step-by-step approach with the more fluid, organic approach of visionaries?

Well first let’s realize not every product-market fit challenge needs a visionary.  You need a vision, but you don’t need to be visionary.  A point I think I didn’t make or emphasize during the webinar is that the process you follow needs to match the product-market fit challenge you face.  The process should map to the project and will vary by project.  Thus, I am not an advocate of standardizing process across all projects within the company.  Secondly, by structuring your inquiry as learning gates focusing on validation and the key questions that need to be answered, the team will remain more open to change, not lock into a single plan, and be more fluid while still being able to maintain the checks and control that management wants to be comfortable funding the project.

 

It looks like this lean approach fits within the Business Model Planning methodology promoted by Steve Blank? Is this your take?

I’d absolutely agree. Steve Blank has influenced my thinking enormously. It was his book “Four Steps to the Epiphany” (read it is you haven’t) that presented a framework and vocabulary that gave structure to the work I did at idealab! around 2001 and why that process was so successful. 

There is also a lot more to Lean PM that we couldn’t cover today in today’s short webinar that addresses areas important to product management (such as working in small batches) that are outside Steve Blank’s work.  The webinar covered a subset of Lean Product Management.  As you look for similarities, it is important to realize that Steve Blank and his number one disciple Eric Ries of Lean Start-up approach the topic of new product development from the perspective of the founder.  Similarly David Anderson, Alan Shalloway, and Mary and Tom Poppendeik approach Lean Software from the perspective of software development, Don Reinertsen has an economist’s lens, and Hugh Beyers comes from the perspective of User Centered Design.  These are all valuable and important views.  Product Management, however, needs to also develop its own point of view, one that addresses the key responsibilities of PM and allows PMs to effectively interface with those other groups on the product team.