Ditch your business idea before it ruins your business
In this talk I will share key learnings from my humbling journey in building digital products, and provide practical tips on how to minimise the risk of failure before you write your first lines of code.
Subjected to paraphrasing and mirror errors.
- My name is Gresë, and I am a cyborg who loves to deliver value and solve customer problems through technology. She has been building and launching different kinds of products for the last 14 years.
- I thought I had great ideas about how technology could make the world a better place, but most of them were probably terrible and the business model didn't work.
- When I decided to foray into the wonderful world of software development, I was leaving behind one of my most successful jobs. But when I answered the first meeting, I realized that I didn't know what this software product management thing was.
- I stopped questioning people, ideas and projects, and I stopped asking for evidence. This kept me focused on executing other people's ideas, and kept me busy, and we all felt very important.
- After a while I started to notice a pattern. People overestimate the value of their own IDs, and you can only know whether an idea is valuable or worthless in hindsight, or as a Medallia earlier set through testing and refining the idea.
- Get to know your customers and stakeholders very, very well. They all have three things in common needs, wants and demands, and we're all born with certain universal needs and develop others.
- Maslow's hierarchy of needs is a popular theory on needs that describes the pattern through which human motivations generally move.
- Customer needs are not created by organisations, they can only be fulfilled by them. Customer wants are shaped by culture and individual personality, and customer demands are the willingness and the ability of consumers to purchase a quantity of goods, products or services in a given period of time or at a specific moment in time.
- I've always found it surprising and at times sad, how few team members were interested to speak directly with the customers of the product they were producing. To know what value is for your customers, you need to understand who are they, what are their needs, demands and desires.
- Bain and Company claims that there are 30 elements of value that help companies better serve their customers, and that this model extends Maslow's insights by focusing on people as consumers describing their behaviours around products and services.
- To be able to deliver on higher order elements, a company must provide at least some of the functional elements required by a particular product or service.
- Products and services must attain a certain minimum level of quality, and no other element can make up for a significant shortfall in that one. So, how can you minimise the risk of launching something that solves the wrong problem when you're building from scratch?
- You need to validate that the people for whom your business idea applies, actually have the problems that you think they have, and care enough about that problem to do something about it.
- Ensure that your value proposition actually creates value for the customers it's intended towards, run experiments to invalidate or validate various assumptions, and finally ensure that your value proposition is embedded in a profitable and scalable business model.
Audience questions for Gresë
These questions were asked by the attending audience of about 180 participants on 27. 10. 2022 at Ljubljana.tech. Maximize your next knowledge experience by attending our event in-person.
- At what time do I know that I have not enough knowledge about a problem that I can start solving?
- The answer to this question depends on a lot of factors. At the moment, where you have gathered enough evidence, not only qualitative evidence, but also quantitative evidence that has made you see the problems in a different light, for example, it also depends on how much time you have and how much money I am currently working on. Validating a problem solution fit for a global Swedish retailer. And they have given us four months to come with enough evidence that validates or invalidates the customer problem statements, and the business case they have given us. So there's no straight answer. Sorry! Thanks. But yeah, somebody said earlier if they give you three days, try to do it in three days. Do what you can with what you've got.
- The age old question, who does research product management or UX design?
- I think the main issue is that there are a lot of companies that expect to have either a unicorn designer, who can do everything from research to design, or a unicorn product manager who can do more than just research. My personal opinion is that research should be done by people who are most qualified to do that. And sometimes it can be the product manager and the team, if they're qualified to do that—if they come from a research background, which happens sometimes. And preferably, it should be a specialised person who does research. But again, my personal experience with researchers is that the more specialised they are about it, the more professional they are about it. It's very difficult to pull them out of research—they just want to keep on researching!
- How do you evaluate and ditch ideas that don't work at large companies and enterprises?
- In this case, I think the differences for the product manager and the product sense that they have. I believe that most product managers want to, as I said, deliver value. And there are only a few of those who just want to linger around for job security. So it is up to the product manager to come to whoever needs to make the decision and say, Look, these assumptions, we've invalidated these assumptions, these customer problem statements don't exist, or customers don't really care about them. Or this will not generate any value for the business. Therefore, let's pivot. Let's find something else. And yes, the bigger the organisation is, the more politics is in it. But I guess that makes it that much more exciting, at least for me.
- How do you measure quality?
- What customers value is what customers perceive as quality. It can be best judged by listening to whether they perceive something as qualitative or not. It always goes back to the customers. Because you may think that you have the best quality, or you view in your product, or your idea is of the highest quality. But if people come back, and even though you think that it's best, they don't find any value in it, then it is not qualities in the eyes of the customer.
- As a product manager, what was the biggest mistake that you've made with the most significant negative impact either on the team or on the budget?
- Oh, I failed a lot. No shame in admitting that. Oh. Which one do I choose? There was a time when I was working with a client to develop mobile apps for their loyalty programme. Bad decision. It was worthless. I knew it from the start. I had this gut feeling. We were not doing any research. We were not doing any discovery. But just this idea of having a loyalty native app for both platforms was wild because there was no value that customers would get out of it. It was the main value proposition was, well, you know, instead of having your loyalty card in your wallet, now you will have loyalty card on your phone. Wow. Customers didn't care about that.
- Follow up, if there was a similar situation today, what would you do differently?
- I would find ways to explain to the client or first to research whether this is something that their customers want. And how big of a desire these customers have for that product. But I've seen many cases when these loyalty apps haven't worked. After so many years, people still don't really care about them. So just try to find ways to prove or to gather enough evidence quantitative and qualitative, to show to the customer that you don't have a problem, solution fit, move on, find something else. Let's research. And let's talk to customers and understand what other problems they have that you could solve.