Great ideas are not the same as great businesses

We've all experienced that joyous feeling of waking up one morning thinking we finally have the product that will solve the mother of all problems. Hey, we even have a product name. We start working on the idea, develop a few prototypes, figure out the pricing and if we're really forward thinking we do a 12 month revenue forecast. And yet, somewhere between that point and the end of the 12 months, our juggernaut starts losing steam. A few weeks later we realise our productivity is dropping and what's worse, our enthusiasm is dropping too. After a few months of denial we finally accept defeat, put the project to sleep and move on. We call it experience and maybe one day we'll sit at the bar and begin telling the story of when we were entrepreneurs. I know cause it happened to me.
Years ago I was having coffee with the CEO of a charity and discussing their needs on the ground. Two hours later we had the bare bones of a new app that would help them solve their material donations problems using Web technology. 

My great business idea could've been called "The Titanic"

I discussed the idea with a developer friend of mine and he said the architecture and user interfaces would be relatively simple and we should have a prototype in a couple of weeks.Those of you in the tech startup space can already see where this is going. My great business idea could've been called "The Titanic" cause it was great and was already heading toward an iceberg within hours of being conceived.What went wrong? I had identified a real customer need. I had a real customer willing to pilot the project and support the roll out to their sister organisations worldwide. I had a technology expert as a partner willing to work for free to develop the product and still it died of death. Let's consider the failure factors:

1. Yes, I had identified a key pain point for the customer but problems are never that simple. What we sometimes  identify as a problem is often just one symptom of something bigger. Before you development start any work create a full list of customer jobs, pains and gains and validate it. Talk to other potential customers and learn if they experience similar issues and how much they would value a solution.
2. We started work on the application while designing the mock up and developing the documentation in tandem resulting in a mishmash of ugly interfaces with limited or no functionality and no way figuring out what was missing. I know that when you come up with the big idea, you want to rush and do as many things as possible to see the finished product before you as soon as possible. But if you rush you'll have no structure leaving the door open for all sorts of creeps. Scope creep and feature creeps that is. Also, you'll have no way of telling if you're making progress. Even if it is a small project, make sure to write down your requirements, features and deliverables and measure progress against them.
3. And talking about scope and feature creep, those were the final nails in our coffin. After a few meetings with the client they started talking about other type of functionality that was loosely related to what we were doing but that in their minds had become more important. Not wanting to lose the client we promised we would look into it and see how we could incorporate it to the existing solution. At the end of that meeting we had somehow implicitly agreed the project was over. The key learning was that you should not start any work without a proper document that details that work to be done and what is to be delivered at the end of it and that is agreed by all parties involved. Sounds basic but we forgot about it and paid the price.

Welcome the customer onto the product journey

The world is becoming smaller by the minute. As a lecturer I sometimes talk about the world as an example of a huge system thoroughly interconnected by invisible arcs linking every physical object in existence. A bit over-dramatic but you get the picture. Fueled by the Internet and social media, reality nowadays is a lot closer to my depiction that you actually think. As individuals, our personal and professional world has expanded. Our links and relationships with friends and family on the other side of the world have become stronger. Information and news reach us quicker and in turn we are quicker to reply and react.

The same is true for organisations and products. Think about it, thanks to the internet now we can reach more potential customers and suppliers than ever before. Our products can reach them quicker than ever before thanks to the likes of Amazon Prime or the new products available from DHL or even the national post service.

However, there is a downside to all these wonderful relationships and newly found customers. The point I made about being able to sell your products easier and quicker works both in your favour and against you. Competitors that in the past wouldn’t have come near your customer pool, are now taking those customers away. Think Alibaba.com eroding some of the well-established eBay markets.

There is more bad news. It’s not just new competitors your organisation has to worry about. Customers are also becoming more proactive, more vocal and more impatient. They have unlimited access on tap to reviews on your company, customer service and product quality. Furthermore, they have more choice and as a result of this choice their loyalty has become fickle.

In my experience, the answer to the problem of customer loyalty has always been cross-sell. Entangle the customer with so many of our products that leaving us is more of a hassle than it’s worth it. That is true to a certain degree, and if executed properly that strategy delivers not only loyalty but also increased revenues and customer satisfaction. There are other options but the one that from my point of view is the most exciting at the moment is co-creation.

As a concept is relatively simple: ask the customer what they want and involve them in the process of developing it. By doing this, the product becomes an intrinsic part of the customer. How could you ever leave the product that you helped to create? It’s par with abandoning a puppy after Christmas.  

Aric Rindfleisch defined co-creation as:

“Co-creation is the realization that one’s customers can lend value beyond the traditional means of simply choosing and using your product and/or service.”

This realisation translates into business changes that enable the participation of customers in the development of new products and services. I would go one step further and suggest that the co-creation process should not only involve customers but internal stakeholders too. In that way we can deliver customer propositions that are closer to the real needs of the customer while at the same time we can enhance the new product development (NPD) process supporting these propositions.

Is product management ready for Millennials?

Let’s face it, as product managers we tend to stay away from the world we consider the exclusive domain of marketers with their segment definitions, campaigns and advertising. After all, we are modest beings with an aversion to the limelight. We are the engine room of any organisation where new products and services are launched to satisfy the needs of our customers. Yes, we take into account the voice of the customer (sometimes) in order to fix bugs and features that aren’t working properly. If customers shout loudly, often and over a short period of time, we may incorporate one new feature as requested by them.

This has worked fine to-date, so what's the big deal? Millennials, the Y Generation. These guys are a completely different kettle of fish. They are impatient, they behave differently, they shop differently and do not follow the rules and that has a significant impact in how we, as product managers, view and carry out the development of new products especially in the consumer space. We have to understand them and design new products and processes with them in mind or we run the risk as organisations and professionals of being bypassed by them.

First of all, why is this generation important to understand for product managers? Statistics from the US Census Bureau puts a figure of 83 million people being born roughly between 1980 and 2000 in the US alone.  To put it in perspective, that means one in every four US citizens is a Millennial. Global figures from Millennial Week 2014 estimate that there are approximately 1.8 billion Millennials worldwide. To put it bluntly, there are a lot of them and they’re everywhere.

Why is this significant? Because, according to Time Magazine thanks to globalisation, social media, the exporting of Western culture and the speed of change, millennials worldwide are more similar to one another than to older generations within their nations. This has implications when it comes to purchasing products from global brands since Millennials listen to one another no matter where they are.

They also have more spending power than previous generations. Jason Dorsey, Lead Millennials Researcher at the Center for Generational Kinetics has said that by 2017 Millennials will bypass the spending levels of Baby Boomers and that’s something that any product led organisation should be aware of. If they think that their colleagues in the marketing department will take care of fine-tuning the brand message to capture this market, they will soon find themselves without revenues and customers.

There are plenty of studies and articles that describe the traits of the Millennial generation. Depending on whom you read today the same attribute can be seen both under a positive and a negative light. Consider the following example: Millennials are brilliant multi-taskers. For the more cynical readers the message is: Millennials have short attention spans and are easily distracted into several activities at the same time. For the sake of this article I’ll concentrate on those traits I consider relevant for the product development process. 

What are they like?

Connected

This generation cannot picture life without the Internet or a mobile device and they will use these as their primary vehicles to communicate with family, peers and companies. Marketing and customer care departments in some companies already use social media as a means to have a dialogue with their customers. How does product management collect feedback from this generation?

Results oriented

If they want something new or one of your products is not working as they expect it, they’ll want it fixed. How quickly you can fix it or deliver it to the market will determine whether you can retain them or not.

Fickle

Baby Boomers were a loyal generation as consumers and as employees. Millennials don’t play by those rules. They have the least established loyalty as customers. However, they have strong principles and beliefs and once they select a brand, product or service they stick with it and are quite vocal about the fact.

What do they want?

Transparency

As consumers, Millennials demand to know where your products are coming from, how they were manufactured, and if they were ethically sourced or produced. If you are not capable of answering those questions satisfactorily these consumers will not trust you and will make sure that everybody in their social network knows about it.

Recognition

The Me Generation is all about being heard and being recognised for the effort. They want their opinion to be taken into account. They want to be involved in the creative process as long as it gives something in return. Are you willing to accommodate them in return for their loyalty?

Instant gratification

You want to hear the voice of the customer but have nothing to offer in return? Quite simply, it’s not going to work with this crowd. They are multi-taskers and therefore, easily distracted. Thus, if they can’t see what’s in it for them right away they won’t devote any of their precious time to help you.

The product management function in many organisations usually sits quietly in the background taking input from other customer facing departments and delivering new products using that input. For the Y Generation this is not good enough any more. Companies must find a way to bring product development to the fore and join in the conversation.

The idea of social entrepreneurship

It is acknowledged that NGO's face a number of challenges regardless of the stage of maturity of the organisation. Many NGO's start life as a one person's dream to do good for a cause close to their heart. They go ahead and set up an NGO which gathers strenght and support from the community and perhaps from corporate or government patrons. You can almost see the graph showing lots of growth, successful stories and increased support in the early days.
Beyond this point, as the initial expansion slows down, the NGO's will start facing internal organisational challenges. As the organisation grows the need for a clearer definition of roles and responsibilties within grows as well. Who's responsible for keeping an eye on the finances? Who looks after supporters and donors? Who organises the next fund raiser?
It is often said that, in order to survive, NGO's have to be managed like businesses and not like charities. They need to make the most of the resources they have and the donations and funds they receive. In other words, they need to bring efficiencies to the day-to-day operation of the business. Did I say business? Replace the word for NGO, non-for-profit, charity, etc. and you should get the same idea.
Some time ago I met with the director of an NGO with whom I have been involved for a few of years. In the course of that meeting the conversation turned towards an issue I had noticed while volunteering with the organisation and from an issue we turned it into an opportunity. in broad terms the question was how to make the most of the limited amount of time and resources in order to secure donations for the various projects they embark upon every year. When I suggested a technology driven improvement the response was straight away "Yes! Can you do it?" Which is not what I had in mind originally. However it brings about the suggestion that there is an ocean of opportunities for entrepreneurs with the right attitude and the acknowledgement that they're not going to retire to the Bahamas after their first social enterprise.

Ideas are like buses

I first came across Soundwave in April 2013 through my wife who said these Irish guys had just released a really cool music app. Soundwave was later reviwed in an article in the Irish Times where it was described as a music discovery app with the challenge of turning the buzz into revenue.

As a music lover I felt like an abandoned child when iTunes removed the Genius suggestions sidebar with the release of version 11 but all of the sudden there it was, a new way to discover tracks, bands, anything. All you had to do was to draw an circle around your location et voila, a rake of random songs you might have otherwise never heard of. I signed up for the beta release and despite of not having a huge footprint due to the limited number of users, I loved it instantly. Furthermore, I could see the potential to extrapolate the concept to other fields. That's when I had my eureka moment but obviously, like a tool, I didn't know what to do with it.

In my twitter feed Russell Banks, formely of Conker now CEO of Pirate Dashboard simply put it: "Apply to Wayra". Utterly ridiculous! I wasn't ready then and even at this point in time I'm still in the discovery stages of a start up but he had a point, unless you do something about your great idea, it'll never add up to anything more than a conversation starter on a night out with your mates: "Hey guys, once I had a great idea." "Yeah, right. Your round"

The next bus came along completely by accident as a result of a couple of pints a few days later.