Lean Product Management @ SDEC13, Winnipeg

agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright ©2007-2013

Lean Product Management

And why I should care


“No matter how good the team or how efficient the methodology, if we’re not

solving the right problem, the project fails.”

Woody Williams


Understanding depends on

Length of Feedback Cycle


Length of Feedback Cycledriven by

Cost of Change x Cost of Validation


Economists

In November 2007, economists in the Survey of Professional Forecasters — examining some 45,000 economic-data series — foresaw less than a 1-in-500 chance of an economic meltdown as severe as the one that would begin one month later.


In 1940, the chance of an American being killed by lightning was about 1 in 400,000.

Today, it’s 1 in 11 million.

vs Weatherman

http://www.nytimes.com/2012/09/09/magazine/the-weatherman-is-not-a-

moron.html


Cost of Change


http://www.archives.gov.on.ca/english/on-line-exhibits/d-day/big/big_03_airline_assembly.aspxArchives of Ontario, Reference Code: C 190-5-0-0-21

Assembly Line Manufacturing has a high cost of change


• In software development high cost of change leads to inclusive thinking

• Any and every idea has to be captured in the first version of a requirements specification

• Creates waste - bloated documents, unwanted features and entitlement thinking

Inclusive thinkingFeature usage in

enterprise software

45%

19%

16%

13%

7%

NeverRarelySometimesOftenAlways

Standish Group - CHAOS Report, 1995, 2002


Cost of Change

Detail of Requirements

Hypothesized Requirements

Capture all possible needs

agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright © 2007 - 2009.

Increasing Choice in Technology Environments

Language types and versions released per decade, taken from O’Reilly’s Programming Language Timeline

0

22

44

66

88

110

1954-1959 1960-1964 1965-1974 1975-1984 1985-1994 1995-2004

104

5041

25

1211

New programming languages and versions released

x10


Software Development has commoditized cost of change

Continuous Delivery

Ruby on Rails

Coffeescript

jquery

Object-oriented languages

Iterative & Incremental

Methods


Cost of Change


Evolving Requirements


Emerging needs as development

progresses



Cost of Validation


Shifting Paradigms

“I know that half of my advertising

budget is wasted, but I’m not sure

which half”Lord Leverhulme

B.G.|A.G.

http://www.marketingprofs.com/charts/2009/3161/more-smbs-use-online-media-than-traditionalhttp://marketing.blogs.ie.edu/archives/2011/01/trends-in-online-advertising-in-2011-in-the-united-states.php


Usability Testing - c.2006


Usability Testing - today

http://welovelean.wordpress.com/2012/01/29/15-essential-tools-every-lean-startup-cant-li/


• If change is cheap, requirements can change continuously

• We can evolve our thinking as we learn more about the product we are building

• Maximizing Return-on-Investment means validating new ideas early, before the total investment cost has been spent

Changing paradigms


Designed by KISSmetrics


Cost of Change


Validated Requirements

Evolving Requirements


Lean Startup experiments

Emerging needs as development

progresses



5 Levels of Learning


Vision Planning

Roadmap Planning

Release Planning

Release PlanningItera3on Planning

Daily Planning

Five Levels of Planning

Annually Define a vision

Bi-‐annuallyRank features in order of delivery

Quarterly Plan stories to be delivered during next release cycle

Bi-‐weeklySprint planning, focussing on delivery of sprint goal

DailyFocus on daily planning of team activities

Vision Planning

Roadmap Planning

5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006)


Product Vision

Customer Behavioural Models


Vision Planning

Roadmap Planning

Release Planning


Daily Planning

Five Levels of Planning Learning

Long-‐termDefine & refine behavioural models we are testing? Pivots happen here.

Medium-‐termValidate understanding with Lean (or Customer Experience) Canvas

RegularlyMinimum Viable Product. Validate ideas before fully committing investment

Bi-‐weeklyProduct Owners, Delivery Team

DailyProduct Owners, Delivery Team

Vision Planning

Roadmap Planning



“In a nutshell, the job of the product organization is to make that vision a

reality. So we don't work for a few weeks or even a few months and then just declare it's not happening and we

should do a pivot. We will typically work hard for many months on a

product vision and not even entertain the possibility of giving up.”

Marty Caganhttp://www.infoq.com/news/2013/07/pivoting-product-development


Validated Learning

• Understand the problem a feature will solve

• Decide how to ask if your customer cares

• Validate before investing complete cost


Theory

Prediction

Experiment

Observe

Use the theory to make a prediction

Design an experiment to

test the predictionRun the

experiment

Modify or change your theory

The Scientific Method


The Theory of General Relativity

Einstein’s Theory of General Relativity

Light bends in a gravitational field

Solar Eclipse of 1919

Observations validated General Relativity

Einstein’s prediction

(1907)

Wait for 1919 solar eclipse to observe

whether or not light bends around the sun

Arthur Eddington observed that Light did bend around the sun

Gradual acceptance of General Relativity over Newtonian Mechanics

http://thethoughtstash.wordpress.com/2011/01/03/how-eddington-demonstrated-that-einstein-was-right/


User Model

Prediction

Experiment

Validate

Use the model to make a prediction

Design an experiment to

test the predictionRun the

experiment

Modify or change your user model

Applied to an Online Experience


Requirements Definition

User Story Mapping and the Lean Canvas


Vision Planning

Roadmap Planning

Release Planning


Daily Planning



Medium-‐termValidate understanding with User Story Mapping and Lean Canvases




Vision Planning

Roadmap Planning



User Story Mapping is a powerful tool for understanding

your product from the perspective of the user


Recognize there are gaps in your vision/business model, and look to fill those gaps in as quickly as possible

Known Unknowns

Map of Africa, 1824http://culturalstudieslectures.blogspot.com/2012/01/

lecture-one-on-question-what-is.html


1.Problem

top 3 problems

Exis3ng alterna3ves

4.Solu-ontop 3 features

8. Key metricse.g. AARRR

3. Unique value

proposi-onClear compelling message. Why makes you different?

2.Customer segments

Target customers

Early adopters?

9. Unfair advantageNot easily copied

or bought

5.ChannelsPath to customers

7. Cost StructureCustomer acquisi3on, distribu3on, people,

etc.

6. Revenue streamsRevenue model, life 3me value, revenue,

gross margin

Lean Canvas: Ash Maurya

Lean Canvas, from Ash Maurya: Running Lean. Licensed under Crea3ve Commons-‐APribu3on-‐Share Alike 3.0

Product Market


ProblemTop 3 problems

Exis3ng /alterna3ve solu3ons

Customer segments

Early adopters?

Success metrics

Leading and lagging indicators

Possible solu-ons

Key features & benefits for customers & business

Business readinessWhat is needed to deploy and support the solu3on?

(Staff, budget, training, systems, support, opera-ons dependencies on projects/

vendors)

ChannelsPath to

customers

CostsPeople, training, capital, marke-ng, etc.+ Objec-ve jus-fica-on

Business value1. User & business value2. Cost of Delay (urgency)3. risk reduc-on/opportunity enablement+ Objec-ve jus-fica-on

Lean Project Canvas

ProductMarket

Cost of delay

time

linear

dela

y co

st

1,2,3,5,8,13,21 1,2,3,5,8,13,21

<Title / headline>

Interaction Model Backlog ValidationDoing Doing Deployed

For <target group>Who <has a specific need>The <product name>Is A <product category>That <key benefit>Unlike <primary competitors>Our Product <additional advantages>

Pathway#1

Pathway#2

•Visualize your User Interaction Model and adjust it as you learn•Come up with ideas for each pathway•Prioritize experimental testing•Spend time on measurement infrastructure (a test without ability to measure = an unvalidated feature)

Level of Detail / Close to done

•Always revisit validation tests for size •The execution board is equivalent to the team’s task board, but at the Idea Card level

Idea#1.1

ExecutionValidated?

Idea

#1.2

Idea

#1.3

Idea

#2.1

Idea

#2.2

To Do Observation

Idea

#2.3

Idea

#2.4

Idea

#1.4

Idea

#1.6

Idea

#1.5


Release Planning - the Minimum Viable Product


Vision Planning

Roadmap Planning

Release Planning


Daily Planning



Medium-‐termValidate understanding with User Story Mapping and Lean Canvases




Vision Planning

Roadmap Planning



Zappos famously launched without stock, selling shoes from their local specialist show store


Minimum Viable Product

A Minimum Viable Product may be an entire product or a sub-set of product (such as a feature):

• Product - The canonical MVP strategy for a web application is to create a mock website for the product and purchase online advertising to direct traffic to the site. The mock website may consist of a marketing landing page with a link for more information or purchase. The link is not connected to a purchasing system, instead clicks are recorded and measure customer interest.

• Feature - A link to a new feature in a web application might be shown in a prominent location on the website. The feature is not implemented, rather an apology, mock-up, or marketing page is provided. Clicks of the link are recorded and provide an indication as to the demand for the feature in the customer base.

It is ALWAYS smaller than you think!


Sticky Note Moment


Validate Everything


One test is worth a thousand expert

opinions.

Wernher Von Braun


“I can’t say it any better, HiPPO’s rule the world, they over rule your data, they impose their opinions on you and your company customers, they think they know best (sometimes they do), their mere presence in a meeting prevents ideas from coming up. The solution to this problem is to depersonalize decision making, simply don’t make it about you or what you think. Go outside, get context from other places. Include external or internal benchmarks in your analysis. Get competitive data (we are at x% of zz metric and our competition is at x+9% of zz metric).Be incessantly focussed on your company customers and dragging their voice to the table (for example via experimentation and testing or via open ended survey questions). Very few people, HiPPO’s included, can argue with a customer’s voice, the customer afterall is the queen / king! : )”

Avinesh Kaushik, kaushik.net


Depersonalize Decision Making

• “HiPPO’s” rule the business world • It is never about you, it can’t be

about you • Benchmarking is awesome • Leverage competitive analysis • Experimentation / testing rock

• Execution strategy: • Transparency, standardization,

looking outside in • Be a slave to customer

centricity (its about your customers (internal & external))


“Data is like garbage. You’d better know what you are going

to do with it before you collect it.”

Mark Twain


Vanity vs. Actionable Metrics

Vanity metrics (like web hits or number of downloads) which only serve to document the current state of the product but offer no insight into how we got here or what to do next.

An actionable metric is one that ties specific and repeatable actions to observed results.


get good at celebratinglearning


• In 2009, Google ran approximately 12,000 experiments, of which about 10% led to business changes

• Linus Pauling famously said, "The best way to have a good idea is to have a lot of ideas."

• Focus on minimizing the incremental cost of testing ideas with your customers/users

How Much Effort on ValidationFeature usage in

enterprise software

45%

19%

16%

13%

7%

NeverRarelySometimesOftenAlways

Standish Group - CHAOS Report, 1995, 2002


Length of Feedback Cycledriven by

Cost of Change x Cost of Validation


Feedback loops make all the difference

In November 2007, economists in the Survey of Professional Forecasters — examining some 45,000 economic-data series — foresaw less than a 1-in-500 chance of an economic meltdown as severe as the one that would begin one month later.

http://www.nytimes.com/2012/09/09/magazine/the-weatherman-is-not-a-

moron.html

In 1940, the chance of an American being killed by lightning was about 1 in 400,000.

Today it’s 1 in 11 million.


Lean Product Management

• Agile drives incremental cost of change down• Lean Startup leverages falling cost of validation• Feedback means nothing without a model

Photo: ESAhttp://www.nbcnews.com/id/50677062/ns/technology_and_science-space

“The race doesn’t go to the one with the best idea, but to the one with the most tested ideas”


thank you

[email protected]: @davesharrock

slides: slideshare.net/davesharrock

“Coming together is a beginning. Keeping together is progress. Working together is success.”

Henry Ford

Lean Product Management @ SDEC13, Winnipeg

Business

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