Managing Products to Deliver Solutions

1. Shift from Product-Centric to Solution-Centric Approach in B2B

In B2B, your portfolio is more valuable than the sum of your products, especially when you look at it from the customer's perspective.

Solutions over products. In the B2B world, customers value integrated, multi-product solutions more than best-of-breed individual products. This is because solutions have a greater impact on the strategic goals of organizations compared to single products.

Customer-focused mission. To drive this shift, create a customer-focused mission that reflects a goal critical to every customer's success, stated in their words. This mission serves as the ultimate qualifier for product ideas and keeps the organization aligned with customer goals.

Portfolio strategy. Manage products collectively to keep your portfolio consistently on track towards the most desirable destination for your organization. This may sometimes mean making decisions that aren't the most desirable for individual products, but benefit the overall solution offering.

2. Uncover Top-Down Market Needs for Greater Impact

In B2B, uncovering needs doesn't begin with users – it ends with them.

Start with industry dynamics. Begin by understanding how broad industry and market dynamics impact strategic initiatives and business practices at all levels within your customer organizations.

Top-down approach. Work your way down from senior executives to department heads, and finally to users. This approach helps uncover needs that are more critical to the success of customer organizations and have a bigger impact on their goals.

• Senior Executives: Understand market views and strategic initiatives
• Senior Managers: Connect strategic initiatives to operational goals
• Managers and Staff: Focus on processes and activities that impact departmental goals

Wider lens. This top-down approach provides a wider lens to uncover business needs, leading to solutions that address more significant obstacles and deliver higher value to the market.

3. Innovate by Focusing on Customer Goals and Obstacles

Innovation is synonymous with uncovering needs that have the biggest impact on the goals of your customer organizations.

Customer-centric innovation. Instead of focusing on creating the next "killer product," invest in uncovering the next significant problem or obstacle preventing customer organizations from reaching their goals.

Three guiding principles:

1. Focus on customer goals and obstacles
2. Ignore the competition
3. Consider products and technologies only after understanding needs

Value-driven solutions. By following these principles, you'll uncover more valuable needs and create innovative solutions that solve age-old problems in unique ways or address problems the market never knew it had.

4. Segment Markets for Clarity and Strategic Alignment

Clarity is essential but often elusive to every part of your organization – from executive strategy all the way through the execution of product, marketing, sales and operational initiatives.

Consistent market definition. Create a clear and consistent definition of your target markets across the entire organization. This clarity simplifies everything from meeting company growth targets to developing ideas for new products and services.

Segmentation structure. Define your segmentation structure in a way that's easiest for your organization to stay aligned with target markets. Common factors include industry, company size, geography, department/business function, and profession.

Customer perspective. The number-one rule of thumb for B2B market segmentation is to refer to your customer organizations as they refer to themselves (e.g., an IT services company, a hospital, an insurance company).

5. Position Your Value Through the Customer's Perspective

Tell buyers what they want to hear and then back it up in a credible manner with the capabilities of your solutions, products and services.

Speak their language. Structure your positioning to speak from your audience's perspective, not yours. This makes it easier for buyers to understand your value and increases the likelihood of converting them into customers.

Industry-specific messaging. Get into the habit of always speaking the language of your customers by industry and/or profession. Avoid the trap of one-size-fits-all generic positioning.

Value proposition development:

1. Talk to recent customers about why they bought
2. Keep asking "why" until you get an answer relevant to senior executives
3. Frame your value proposition around that high-level impact

6. Create Business Cases That Pack a Stronger Punch

Markets are unpredictable, which makes every business case questionable at some level.

Emphasize high-impact market needs. Build business cases around specific needs or obstacles that significantly impact customer goals, even if it means combining multiple product initiatives into a single case.

Project revenue by market segment. Break down revenue projections by market segment, distinguishing between existing and new customers. This provides clearer perspective relative to sales force size, average sales cycle, and company strengths in each market.

Tie to company agenda. Consider how the business case advances your company's strategic agenda or helps overcome challenges beyond financial goals. Treat it like a sales presentation, creating an emotional connection with your audience.

7. Leverage User Stories for Powerful Marketing and Sales Dialogues

User stories may be the heart and soul of Agile software development, but they also give marketing and sales a powerful dialogue to communicate your value messages.

Beyond features. User stories articulate what the product accomplishes and why anyone would care, especially decision-makers in a sales cycle. They provide context that features alone cannot convey.

Customer language. Write user stories in the words of the customer to make them more relatable and impactful. For example: "In the next release, your accounting department will be able to notify customers of their impending credit card expiration so they can avoid disruptions in service without having to call each customer."

Proof points for value propositions. In B2B, consider user stories as groups of proof points that support higher-level value propositions for key business solutions. This approach allows marketing and sales to amplify every value statement with concrete examples of how the solution benefits users and the organization as a whole.

8. Implement a Two-Role Product Management Discipline

In B2B, integrating problem-finders and problem-solvers into a well-rounded, cohesive product management discipline is the easiest way to deliver higher-value to the market and achieve maximum strategic impact within your organization.

Problem-finders (10-20% of team):

• Focus on understanding industry/market dynamics and their impact on customer organizations
• Identify high-value business needs from top to bottom of customer organizations
• Define positioning of current offerings relative to those needs in each market segment

Problem-solvers (80-90% of team):

• Own day-to-day care and feeding of products
• Team with problem-finders to formulate portfolio strategy and define high-value solutions
• Improve value of existing products to retain customers
• Manage day-to-day execution of all product initiatives

Benefits: This integrated approach leads to higher customer retention, faster growth, better day-to-day execution, and greater influence on the company's strategic direction.

9. Foster a Consultative Relationship Between Product Management and Development

When people who specialize in uncovering problems (product management) routinely consult with those who specialize in solving problems technically (engineering/product development) and vice-versa, the end result is better for everyone, especially those who market, sell, support and use your products.

Stay in your lane. Product management focuses on the WHO, WHAT, WHY, and functional HOW, while product development owns the "technical how."

Educate and inform. Both disciplines have a responsibility to keep each other informed about industry trends, evolving business practices, and new technology trends.

Build project plans together. Collaborative planning leads to higher confidence levels and better resource allocation.

10. Apply Agile Principles to Product Management Implementation

A moving target is the premise of an Agile-style implementation project.

Goals. Define the mission of product management relative to the organization's goals and get buy-in from key stakeholders.

Backlog. Create a collection of simple user stories for each key process, prioritize them, and get stakeholder approval.

Sprints. For each user story, define the process flow, create required artifacts, assign roles, get stakeholder sign-off, and roll out the process.

Benefits of Agile implementation:

• Easier for everyone to understand and execute
• Produces better results faster
• Keeps stakeholders energized and engaged
• Allows for adaptation to constant organizational change

By applying these Agile principles, organizations can implement a product management discipline that remains flexible and aligned with evolving business needs.

Last updated: August 8, 2024