Product Management 101 Series — Part 2 — Identify Business Objectives
Why should you read this blog
I am in the process of producing a series of blogs capturing Product Management (PM) job function aspects. Part 1 of this series (published here) provides a 100ft level Outline of PM execution.
The current blog is Part 2 in the relevant series and covers the importance and approach for the very initial step that a PM needs to take during Product Strategy formation – Identifying the right Business Objectives. This blog covers:
- Why should a PM first identify the relevant Business Objectives when formulating a Product Strategy?
- A sample framework that can help in identifying Business Objectives, and how such a framework can be applied to a real-life example.
Business Objectives – Genesis of Product Strategy Formation
While figuring out the strategy for a new product in the market or enhancing an existing one, PM needs to work with the executive management to very clearly identify the chief business objectives.
Plenty of examples can be considered for understanding this approach, and one such case is from India — Reliance Jio. A few years back, the company wanted to launch 4G internet as a product in a market where many established internet service providers were already playing well. They adopted a winning strategy by identifying the business objective targeting heavy User Acquisition and strong User Engagement. Reliance first launched smartphones at unbelievably low cost to lure billions of Indian citizens and also launched a number of Entertainment and Utility mobile applications which common people would love to consume. Along with building this traction, Reliance Jio offered the 4G network services which the consumers would need, to smoothly consume appealing content as well as services, using the Jio mobile infrastructure. Such clear business objectives helped Reliance Jio to execute the aforementioned disruptive strategy. They could correctly prioritize what solutions with which features they need to offer to a huge size of the Indian population and eventually progressed to become the largest mobile network operator in India and the third-largest mobile network operator in the world with over 405.6 million subscribers, as of 2019.
With clearly laid out Business Objectives, PMs can easily decide what product feature should be prioritized over the rest. E.g. If one of my business objectives is to target the market in Japan, one of the features I need to prioritize in my product web and mobile interface, is the support for Japanese characters and language localization.
One Example Framework that can help, but do try creating your own
Very well-known frameworks have been established for helping professionals create Business and Marketing strategies, like:
- Customer Decision-Making Process
- Marketing Mix 4 P’s (Product, Price, Promotion, Place)
- SWOT (Strength-Weakness-Opportunity-Threat) Analysis
- Situational Analysis 5 C’s (Company, Customers, Competitors, Collaborators, and Climate)
- Porter’s 5 Forces — Threat of new entrant, Supplier Power, Buyer Power, Threat of Substitutes, Rivalry among existing competitors.
- BCG (Boston Consulting Group) Matrix
If you are studying or have studied courses like Masters of Business Administration (MBA), the aforementioned frameworks may be familiar. Even if that is not the case, there are plenty of articles and videos available publicly, clearly explaining what concepts are included in these thought models. And this is not a finite list, there may be even more such guiding principles in place, addressing the same purpose.
Note — Fig 2 has diagrams that have been picked up from multiple articles or YouTube videos and not made originally by the author of this blog.
What is important for PMs is to deeply go through such frameworks and create your own consequent abstraction of strategic thought process that helps identify pertinent Business Objectives. An example of one such framework is given below in the form of a table. It mainly consists of different factors, the understanding of which can drive the identification of Business Objectives. These factors are categorized into various sections. The table has the following structure:
1. Table is divided into different sections as follows:
a. Current Company context — This section consists of factors which cover very specific details about the nature of the company if it is a Product or Services/Consulting company etc. Considering the current context can help in identifying the strength and weaknesses of the organization, any low hanging fruits in the market which can be leveraged, etc.
b. Target Segment Based — This section includes factors that focus on a specific target scope that may be of interest to the concerned strategy being planned, e.g. Any specific Geographical region market, or Industry Vertical.
c. Product Packaging or Operational aspects — These are aspects related to how the concerned product will be distributed (Mobile App store, as-a-Service, etc.) and any other factors related to how the organization is operating (e.g. Partnership).
d. Consumer/User-Based factors are associated with various objectives like Getting more users to register with the product or nudging the users to use the product more frequently.
e. Financially Significant factors revolve around aspects like product revenue or customer investment and returns.
f. Inevitable External factors take into account environmental issues, climatic calamities, the government introduced regulations or standards to be complied with.
g. Key Functions and Features are related to specific strategic moves the product needs to adapt for getting recognized as a Visionary or Industry-leading platform.
2. (Column) Driving Factor — Within a particular section (check the previous #1), a specific factor that could drive identification of Business Objectives.
3. (Column) How it helps identify Business Objectives — explanation of why/how a factor could help in identifying Business Objectives.
4. (Column) S-W-O-T analysis based comments — Identifying if a factor poses as either a Strength, Weakness, Opportunity, or a Threat for the company and what could be possible remediation actions that will influence the product strategy.
5. (Column) Business Objective ideas — The exact resulting Business Objective, which should drive the Product Strategy ahead.
(Column) Success measurement approach — Once the concerned product is out there in the market and is in use by customers, how exactly should it be measured that the underlying business objective is getting sufficiently addressed? Right Metrics need to be identified. For E.g. If an Increase in User Engagement is set as a business objective is, then the measure of successful accomplishment of this objective should be based on a Metric like — Number of Users logged into the product app/day, Average session time for a user, Number of actions taken by a user during a session, Number of events processed by a user, etc.
Table 1 — Sample Framework to identify Business Objectives
Let's see the Framework in Action
A simple example of a Business Objective is presented in Part 1 of this blog series, a section entitled 1. Identify Business Objective. We will use the same case study for understanding how the framework shown in the previous section can be actually utilized in practice.
Hypothetical Scenario (few facts are genuine though)
· Oracle is a large multinational software technology corporation with ~39 Billion USD Revenue. It offers hundreds of products in a variety of technologies like Databases, Enterprise Resource Planning (ERP), Human Capital Management (HCM), Customer Relationship Management (CRM), Supply Chain Management (SCM), Infrastructure Cloud Services, and Application Development Platform services.
· Oracle eBusiness Suite (EBS) is the most widely adopted collection of on-premises ERP, HCM, and SCM products with more than 10000 customers. The new flavor of these products is being offered by Oracle in Cloud as Oracle SaaS.
· Oracle offers multiple Platform Cloud services, say for modeling backend integrations, business processes, building mobile and web applications, running automated DevOps pipelines, and so forth.
· Strategy — Considering more than 10000 customers for Oracle EBS, Oracle wants to leverage this large customer base for pitching all possible products that could be positioned sensibly. An idea, to position the Platform Cloud services to these EBS customers, is to actually provide them with a new product — a fully functioning Mobile Application, free of cost. This app will offer basic employee actions like Expense Report approval, Timecard entries creation, and approval, training enrolment, etc. working on top of business processes modeled in Oracle EBS. From the primary consumer i.e. the employee standpoint, the app will be called MyHelp Mobile App. Customers will start providing this app to millions of their end-user employees. Once these customers would get accustomed to the mobile app, they would want to extend and customize based on their specific needs, building integrations in the app with new backend modules, model business processes, etc. For this purpose, they would get to use the same set of Platform Cloud Services from Oracle, which has been leveraged to build the same app, and this should lead to a possibility where these companies also invest in Oracle Platform Cloud Services for other IT needs as well.
Business Objectives set by PM
The respective Oracle PM team used the aforementioned framework for identifying the relevant business objectives while creating the product strategy of the MyHelp Mobile App.
Note: The same table in the previous section has been used as a template, filled with specific details for MyHelp Mobile App, and presented below. Driving Factors that are not relevant for this app, have been struck through but may have significance for other products you are planning to build.
Table 2 — How Sample Framework is used to identify Business Objectives for MyHelp Mobile App
What do we conclude
The very initial step during Product Strategy formation is the identification of the right Business Objectives. With clearly laid out Business Objectives, PMs can easily decide what product feature should be prioritized over the rest. This blog has also presented a sample framework that could help PMs in this activity.
The next blog in this series will be based on the topic of Building Customer Empathy.
