3 Characteristics of a Good Product Strategy and How to Craft One

3 Characteristics of a Good Product Strategy and How to Craft One

There is no dearth of strategy and business model canvases - and yet for most teams, despite all the templates available, it’s hard to craft a good product strategy.

In this article, I’ll share the common hurdles I’ve seen in crafting a clear strategy and summarize what makes a good product strategy so that you can craft one irrespective of the tools you use.


Three characteristics of a good product strategy

Want to know if you have a good product strategy? Ask your self the following three questions:

1. Is it actionable?

This is where I find the Business Model Canvas lacking. It’s good for thinking through the different elements of a business, for example, your key partners, key resources, and value propositions. But once you’ve filled these out, what then?

I repeatedly observe teams struggle to use the insights from this canvas to create an actionable plan. Product leaders or founders typically fill out the Business Model Canvas and then file it away for posterity.

Instead, a good product strategy drives your roadmap and the metrics you’ll measure to know whether your approach is working. It’s a document you edit regularly as you prove or disprove hypotheses through your execution.

A good product strategy is living document that gives you an actionable plan for achieving your vision.


2. Is it grounded on your user and their pain?

I often observe teams filling out the Business Model Canvas from the perspective of what the product or company is currently good at delivering. For example, you might list what you think are Key Resources, or Key Parterships. For example, you might list people and machine learning talent as a key resource.

Instead, to build transformative products, every element of your product strategy should be based on what your users need and what you’re doing to solve that problem. In this case, your HR team needs to see why machine learning (ML) talent is key to solving your users’ needs. (ML might be what your company wants to invest in, but it may not be what your users actually need).

Your product strategy must help different functions in your organization see how their work comes together to solve your user’s pain.


3. Does it help you retrace your steps and guide your next iteration?

Your product strategy is the equivalent of doing a complex algebra problem. Remember how your math teacher told you to show your work? When each step of your strategy follows from the previous step, not only does it make it easier to go back and troubleshoot your strategy, but it also helps others follow along and understand your rationale.

For example, if you released a feature that isn’t delivering the results you expected, you can go back and check which of your assumptions you need to revisit. What else needs to change in your strategy because you’ve invalidated some assumptions?

Your strategy must communicate the Why behind your iterations to bring your team with you on the journey.


How do you craft such a strategy?

A good product strategy must answer the following four questions  —  RDCL (pronounced “radical”) is just an easy to remember mnemonic:

  • Real Pain Point: What’s the pain that triggers someone to use your offering?
  • Design: What functionality in your offering solves that pain?
  • Capabilities: What underlying capabilities or infrastructure do you need to deliver on the promise of the solution?
  • Logistics: How do you deliver the solution to your users? This is where you identify your business model, sales channels and how you’ll support and service customers.

The template below that you’ll find in the Radical Product Thinking toolkit, makes it easy to craft such a product strategy.

RDCL Strategy Canvas


Tips for using the RDCL Strategy template

Real pain points

Start by identifying the different segments that need to engage with your product. For each user segment, what’s the pain that makes them come to your product?

Once you’ve identified the target personas and their pain points, you can begin to prioritize them. It’s unlikely that you could address all of them at once – by acknowledging this and prioritizing pain points, you’re giving your team an actionable strategy.

Design

For each pain point that you’ve listed, think about how you’ll solve it through your product, i.e. what’s the design. Remember that your solutions might be features in your product, or even services.

Taking this approach helps everyone in your organization understand how the feature or service they’re working on is solving a Real pain point for users. If a feature you release doesn’t have the expected results, you can troubleshoot your strategy by questioning your assumption about the Real pain point - maybe it wasn’t real after all.

Capabilities

For every solution you listed under Design, think about what you need under the hood to power that design. Your Capabilities could be both:

  • Tangible such as data, patents, trade secrets, hard to build skills, and
  • Intangible including relationships, partnerships, and processes.

Often these capabilities will be the innovation in your solution and create a barrier to entry for the competition.

Logistics

How does your product get into people’s hands? This is where you think about your pricing, support, service, sales channels, training, and delivery mechanism - these are all factors that should be designed into your product. For example, if you were a developer building a house, you’d build a smaller house and price it lower if you were targeting a young couple or first time house owners.

Pricing, support and training are often afterthoughts bolted onto the product - instead a good product strategy helps you align these factors with the rest of your strategy (Real pain points, Design and Capabilities).


TL;DR

Irrespective of the canvas you use, you need a clear strategy that is grounded in your users’ real pain points to create a user-centric product. If you’re building a simple product, you could do this in your head using just your intuition. But the more complex your product, the more vital it is to get it out of your head and onto paper and have each step of your strategy follow from the previous. Similarly, to lead your team through this journey, take some time to work through your strategy together.

In the Radical Product Thinking approach, the RDCL Strategy canvas helps you craft a comprehensive strategy so you can communicate to your team an actionable plan for translating your vision into reality. You can download the free toolkit or get the Radical Product Thinking book here.

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