\u00a0<\/span><\/p>\n <\/p>\n <\/p>\n If the direction of action in developing the offering is not clear, it is understandable that different views will emerge. The doers begin to realize themselves. Often this is realized when different functions of the company have a completely different view of the direction. Sales are driven by the customers’ short-term wishes, product development focuses on technical refinements (or re-doing things they already can), and product management halts when the target state is unknown.<\/span><\/p>\n The change, say a business model enabled by digitization, affects the entire organization. If there is no common understanding of what the steps are, there is a high probability that change will not happen. Change always requires time and effort also in relation to the product portfolio.\u00a0\u00a0<\/span><\/p>\n Without a product strategy, the offering can only develop incrementally. We can add functionality X and customer desire Y, and measure our performance in each quarter’s financials. But if we only see the current situation, the company will not be able to respond to the changes in the market and environment.\u00a0<\/span><\/p>\n Longer leaps (compare <\/i>McKinsey’s horizons<\/i><\/span><\/a>) will not occur if the focus is only on the present. Then the question is, how long will we stay in the competition?<\/i><\/span><\/p>\n<\/blockquote>\n <\/p>\n When making a purchasing decision, the customer assesses the ability of the producer to meet future needs. Finding a new supplier is often a longer process than we would like. Purchasing efficiency is reduced if there are a large number of suppliers and the average purchase is small. Nor does the buyer make his decisions objectively, but wants to work with reputable companies. What better tool to convince the customer than a presentation of what kind of challenges the customer himself will face later? And how we as a supplier have already begun to prepare for it.<\/span><\/p>\n Predicting the future is difficult. When using long term roadmaps, it is advisable to raise the level of abstraction the further the events are. An outlook of the operations for about 12 months, an outlook of what kind of challenges we will be solving in about 24 months, and after that, just an outline of the development and phenomena in the customer’s context.\u00a0<\/i><\/span><\/p>\n<\/blockquote>\n Without a proper product strategy, we compete with the same arguments as our competitors. This leaves only one differentiator \u2013 the price. This is often manifested by reading win-loss analyses. 80% of the time the reason for the loss was a lower competitor price. While many important factors influence purchasing decisions, the benefit of a product strategy is that it helps to create a distinctive offering, which reduces the importance of the price tag. The benefits of a product strategy are undeniable in this respect too.\u00a0<\/span><\/p>\n Who would want to compete only on the price?\u00a0<\/i><\/span><\/p>\n<\/blockquote>\n How can marketing and sales help you to sell your product if you cannot clearly communicate your strengths? The first rule of product marketing is to capitalize on your strengths. How can you do good product marketing if you don’t know what your strength is? A company’s competitive advantage is usually reflected in its products and it is the backbone of the product strategy. Or at least a theme that is somehow present in all products. How can a marketing campaign succeed if you can’t tell your marketing partner which customer segments to target?\u00a0<\/span><\/p>\n Products are successful when they are made to meet the needs of a limited customer segment, and marketing and sales are targeted to those same segments. A good product strategy also defines the customer segments you want to reach, and thus marketing gets the raw material they need for their work.\u00a0<\/span><\/p>\n <\/p>\n <\/p>\n If we don’t know where we’re going, the wishes of (individual) customers drive our product too much. Product business is standardization, you have invested in product development and in return the same product is delivered as it is to multiple customers. The customer\u2019s wishes are taken into consideration, but as a rule we provide our own solutions to the customer’s problems and needs (because the customer may not know the best solution to their problems). With a good product strategy, we can proactively respond to the customers\u2019 needs, enabling us to present solutions to the needs before the customers come up with their own solutions.<\/span><\/p>\n If individual customers get too much influence over our development, a \u201ctwo-customer\u201d solution with a product business cost structure and project business volumes will emerge.\u00a0\u00a0\u00a0<\/i><\/span><\/p>\n<\/blockquote>\n If a product strategy does not guide product related decision-making, decisions will not be made. They are often referred to a management team, which can be a bottleneck for decision-making. Of course, when developing a product strategy, the strengths and conditions come from all of the company’s operations.\u00a0<\/span><\/p>\n Indeed, a product strategy is a common plan that affects the operation of all departments more or less. That’s why the benefits of a product strategy are so significant.\u00a0\u00a0<\/i><\/span><\/p>\n<\/blockquote>\n However, it is good to remember that when developing products, decisions are based primarily on the needs of the customer and the market. The management team\u2019s best expertise is usually in finance, human resource management or production, so they do not necessarily have answers\u00a0 what is needed in the market next. The product strategy answers these questions.\u00a0<\/span><\/p>\n Without an effective product strategy, decision-making slips away from where it is best placed. One of the most important principles of modern management is that decisions are made where the best information is available to make them. This principle requires that the framework is easily and comprehensibly accessible for all. In terms of developing the offering, the former is easiest to communicate with a product strategy presented in the form of a roadmap.<\/span><\/p>\n <\/p>\n <\/p>\n The product strategy includes a long-term goal. What does ”long-term” mean then? The timeline varies according to the maturity of the company and the length of the product life cycles:<\/span><\/p>\n The product strategy includes the means to achieve the desired goal. The product strategy includes a description of how we go from our present state to our desired goal. The product strategy is not, however, written in stone, and towards the end of the planning period, things are not dealt with on a detailed level.\u00a0\u00a0<\/span><\/p>\n A good product strategy also documents what we don’t do \u2013 which protects product development from unnecessary requests in particular.\u00a0\u00a0<\/i><\/span><\/p>\n<\/blockquote>\n Assumptions are made when creating a product strategy, because we always have an incomplete picture of the future. It is of utmost importance that the most important assumptions are logged and get at least some simple metrics.\u00a0 Regularly monitoring the metrics can change the product strategy to better reflect reality.\u00a0<\/span><\/p>\n The benefits of a product strategy are undeniable. They include, among others:<\/span><\/p>\n \u00a0<\/span><\/p>\n Interested in improving your product strategy? Check out our Product Management services here<\/a>!<\/em><\/strong><\/p>\n <\/p>\nThree major problems caused by a missing product strategy:<\/b><\/span><\/h3>\n
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<\/p>\nThe company\u2019s change projects stop<\/b><\/span><\/h3>\n
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The company\u2019s messages towards customers do not stand out from the competition<\/b><\/span><\/h3>\n
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<\/p>\nDifficulty and slowness of decision-making<\/b><\/span><\/h3>\n
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<\/p>\nWhat is included in a good product strategy?<\/b><\/span><\/h3>\n
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The most important benefits of a product strategy:<\/b><\/span><\/h3>\n
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