Most product managers know how to create a product vision, but that’s not the hard part. The more difficult part is getting stakeholders energized and on board the proverbial train. Here’s the thing. The extent to which stakeholders get behind your product vision has everything to do with how the product vision is articulated.
What is a Product Vision?
In the simplest terms, a product vision defines the long-term mission of your product. In other words, it’s the answer to the question, What do I ultimately want my product to be known for?
Why is a Product Vision Important?
Product managers often refer to their product vision as “my north star.” It’s a great analogy as it keeps everything and everyone focused on the ultimate goal of the product. It’s your foundation that keeps everyone grounded on the one goal that always matters the most.
That level of focus is critical. There are so many variables that can influence the direction of a product and lead it astray before you even realize it. Your product vision or north star, is the thing you always come back to when all the different agendas, priorities, design debates and other variables swirl around you as a product manager.
Biggest Challenge Creating a Product Vision
If you take the term product vision at face value, it should be about the product, right? The ultimate goal of your product and the contribution it makes to your organization’s top and bottom line is critical. It’s also the biggest problem with most product vision statements and the reason no one is getting lathered up over them!
It’s hard to get stakeholders fist-pumping over things like…
- be the market leader
- execute the most payment transactions
- pay more employees than all other payroll systems combined
- to be the leading provider of…
- to make the best product in [category]
If your product vision resembles any of the above, you won’t be feeling the love from any direction.
Of course, investors will get on board with anything that supports financial growth but product managers don’t work with investors on a daily basis. Sure, product managers have to keep the numbers in focus with every major decision, but those numbers shouldn’t drive the product vision. Numbers change too frequently. Your product vision shouldn’t.
Stay Away From Inward Facing Product Vision Statements
Bottom line, product vision statements that are all about the success of your product and your company first and foremost, aren’t going to get anyone excited even though those goals are important.
Furthermore, the inward-facing product vision statements make for a terrible north star because the customer value component is nowhere to be found.
When chaos ensues around product direction, priorities, design, etc., how does “becoming the leading provider of…” bring everyone back to earth? It doesn’t. There are too many right answers to accomplishing that goal and most are subjective.
How to Create a Product Vision That Energizes
When 80% or more of your stakeholders are energized and on board, your product vision has hit the mark!
Answer Two Questions to Create Your Product Vision
1. What’s the ultimate business outcome target customers want from your product?
The answer to this question is your vision statement.
2. How is that outcome measured?
The answer to this question makes your vision statement real.
If you have a portfolio of products, create your portfolio vision first. That way, it’ll be easier to tie the vision of each product to the portfolio vision.
Let’s say you have a portfolio of products (or a platform with multiple modules) that target multiple functions in the customer’s sales organization. Your portfolio vision would be directed at your economic buyer, the CRO (chief revenue officer). In other words, your portfolio vision should mirror the ultimate goal of the CRO.
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Sample Portfolio Vision
“To help our customers grow revenue, market share, wallet share and customer retention.“
Let’s give it the acid test.
- Is there any CRO that doesn’t want to grow revenue, market share, wallet share and customer retention? No. That’s what they get paid to do!
- How is the outcome measured?
- Revenue is the sum of the following:
- Market share can be measured at the highest level by the number of new logo accounts and the revenue associated with each.
- Wallet share can be measured by the number of products purchased/in-use and the revenue generated by existing customers.
- Customer retention can be measured by the percentage of customers that renew each year and the rate at which they renew.
It passes the test on all fronts.
Supporting Product Vision Statements
Now that you have a solid portfolio vision, the vision for each product should be pretty straight forward.
If one of your products is a strategic account planning application for the customer’s account management function, its vision statement would be aimed at wallet share and retention.
If one of your products is a lead nurturing application for the customer’s business development function, its vision statement would target new account acquisition and market share growth.
If you’re thinking parent-child relationship between portfolio vision and product vision, you’ve got it!
Product Vision vs. Company Vision
When you’re a startup or small company with one or just a few products, your company vision and product vision are often one and the same. As your portfolio grows and targets multiple departments or business functions within the customer organization, your company vision may change.
Nevertheless, there should still be a clear line of sight between your company vision and portfolio vision, and from your portfolio vision to the vision of each product.
How Your Product Vision Keeps You Focused and Grounded
An outcome-based (customer outcome) portfolio vision has an extremely long shelf life. Using the example above, there will never be a time when revenue, market share, wallet share and customer retention aren’t top priority for a CRO.
When it comes to your portfolio strategy and product investment priorities, they should reflect the investment priorities of your target customers.
Back to our sales platform example, in any given year, your target customers across the market may be investing more heavily in customer retention and wallet share versus new logo acquisition. In other years, new account growth may be a higher priority given the dynamics in their market.
When the pandemic landed in 2020, the new account pipeline evaporated overnight for many companies. Their focus quickly shifted to existing customers and wallet share.
Your focus should mirror that of your target customers. That doesn’t mean you shouldn’t invest in other areas. It just means the weight of your investments should reflect that of your target customers, unless your products arrived in the market ahead of the customer need!
Using Product Vision to Net Out Your Product Priorities
Here’s the best part about creating a product vision that reflects the ultimate outcome of your target customers. From now until eternity, your target customers will face obstacles to achieving that outcome.
Those obstacles will be created by the customer’s market dynamics, new technologies, emerging business practices, regulations and a host of other factors.
Your job as a product manager is to simply identify and prioritize the biggest obstacles (you’re capable of eliminating) standing in the way of that ultimate customer outcome. Then create and execute a plan to eliminate those obstacles.
It really is that simple.
Designing and building the solution is still the hard part, but it won’t be nearly as difficult when the business outcomes and obstacles are perfectly clear.
Product Vision vs. Company Goals & Objectives
Your company’s strategic and financial goals and objectives are still important and should still be top of mind, albeit with a different perspective that will simplify your ability to quantify the value of your product investments back to your own organization.
If you’re consistently eliminating obstacles that prevent your target customers from executing on their priorities, the financial analysis on the contribution back to your organization should be pretty simple in relative terms. It also makes for a much stronger business case that will be easier to get funded.
The “customer value first” approach is the reverse of how most organizations operate. Here’s the problem with using your own company’s goals to drive your portfolio and product vision. It’s inside-out product management and it’s too easy to convince ourselves that customers value things that first and foremost help us meet our own goals. It’s a slippery slope!
The Bottom Line on a Customer-Facing Product Vision
Customers may tell you they buy your solutions to solve problems. The reality is they buy your solutions to get outcomes. Those outcomes are how they get measured and compensated.
No one gets a bonus based on the list of problems they’ve checked off. It’s the outcomes that resulted from solving the right problems that guarantee their bonus.
As product managers, our responsibility is to make sure our target customers get the ultimate outcomes they’re paid to get. Creating a product vision that mirrors those outcomes keeps us laser-focused on eliminating the biggest hurdles standing in their way.
If you want stakeholders to fall in love with your product vision, make it all about the customer and how you’re going to make them better at whatever they do. Just make sure you do it in a way that supports your own organization’s strategic and financial goals.
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If you want to simplify your portfolio and product vision and establish a stronger leadership position in your organization, contact Product Management University about personalized training that puts customer outcomes front and center. It simplifies everything!
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by John Mansour on June 5, 2023.