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Welcome to our series of CEO Guides. The aim of these articles is to provide a short guide on key technology topics. These reflect the common questions we are asked by CEOs as well as outline the critical foundations of each topic.

What is Product?

Why is it important?

Key points for CEOs and Board members

Common CEO questions about Product

What Product is not

Examples of how AKF works with product organizations

What is Product

Product is a much-used term and can be used to describe the role and function of product management; or a department under a chief product officer that often includes product management, product design and maybe even UX research; or it can be used to describe a product team which is a sprint team or squad comprised of a product manager as well as engineers and product designer (and even a few other roles at times such as data analytics).

Why is it important?

Product-focused companies build products and services with a user-centric approach fuelled by data, working iteratively with small empowered teams and striking a good balance between focus and agility.

At its heart, a product-centric approach focuses on outcomes not outputs. The success of a great product team can easily be measured through the value it creates for the company. This is very different from a project-led approach which is based on outputs (stuff being built) which as an approach is often more expensive and less successful.

There should also be a good tension between execution and strategy. A good product leader should have a clear vision and strategy that is matched by regular, impactful execution.

Key points for CEOs and Board members

1. Product management is not the same as project management. If there is any confusion on this within your company, you should address as soon as possible. As the CEO, you may be very clear on this point - but if the rest of the organisation is not, you need to help educate your broader staff to aid the product team.

2. It is critical for CEOs to have alignment across their executive team in terms of vision, priorities and metrics. Too often product leaders and their teams bump up against either conflicting priorities - or perhaps even worse - a never ending list of different priorities depending on the team. No product team can excel if the CEO is not very clear on the direction and does not have a handful of key priorities (1-3 is a good number).

3. Product teams work iteratively. You need to be comfortable with rapid experimentation and failure. When failure comes (and it will) ensure there is no blame or witch hunt. Failure is fine as long as it quick, actionable lessons are learned and there is still a clear focus how the final product will create value for users and the business.

4. Products are rarely finished. Your CFO may expect a team to finish building one product and then abandon it to build the next new product. The inconvenient truth about software development is that all products need maintenance, technical debt needs managing and it is likely that more value can be created. However, this is not an excuse for a team to tinker and not demonstrate impact on the business. Every product has a lifecycle.

5. A good product team weighs up the opportunity costs of their decisions. A good idea is not the same as a great opportunity. This means product teams will say no to ideas more often than they say yes. They will likely need your support if other parts of the business push back when their ideas are rejected or poorly thought out.

6. Product vision and strategy lie at the heart of every great team. Don’t let your product team fall into the trap of talking about process all the time. Agile is a capability, not a strategy. Don’t hesitate to push your product leadership for a clear and bold strategy and vision. This is where a CEO’s time should be spent with the product team - not in the weeds of the process.

7. But a great product strategy needs a clear vision of the future from the CEO. Many companies fall into execution mode and forget to take time for vision and strategy. Work closely with your Chief Product Officer to ensure a strong vision and aligned strategy. The other critical partner here is the Chief Technology Officer as a product strategy and a technology strategy should be one of the same. Plus it is a waste of great talent to not include the engineers at the very start of any strategy process as they can help the organisation understand what is feasible tomorrow that is not possible today.

8. Feedback from customers (current, lost or potential) should be constant and can be gathered in a variety of ways (i.e not just expensive focus groups). Ask your product team about customer feedback. CEOs and exec teams can learn a lot by sometimes attending customer feedback sessions.

9. Product development is a team sport. Investing in product management always requires investment in engineering, product design and data. You need to ensure you build balanced cross-functional teams rather than invest in just one discipline.

10. Product leaders need the support of the CEO. A product manager’s job is always going to make them unpopular at times within your organisation. The role is to balance the business needs and the user needs. Product managers cannot make everybody happy all the time (and nor should you want them to).

Common CEO questions about product

Why does my team resist timelines and roadmaps?

Good product teams are focussed on impact. Therefore you should avoid demanding very specific dates for outputs or a one to two year roadmap with a list of deliverables. Teams still need to be held accountable and should be judged on the value they create for your users and the business. However, being focused on impact does not mean teams can avoid questions regarding when something will be delivered. All teams should be shooting within a time range and/or they should have a good understanding on how much time to invest in each idea.

Do we need Product on the executive leadership team?

More and more firms are adding the role of Chief Product officer on the exec team, even for non digital-only companies. Both Engineering and Product need a seat at the top table (and increasingly is often the same person holding the role of CTPO).

How do I measure the success of my Product leader?

Product metrics should reflect how the team creates value for the business and therefore should primarily be judged by business metrics. However, as mentioned above, there needs to be alignment on these personal and departmental objectives across the executive team.

Why does my product leader talk about agile beyond the tech team?

Agile is a software development methodology but it is also a mindset that is seen across successful organisations. Some may also call this a digital mindset, a customer-centric mindset, or a product mindset - but whatever you call it, the term underlines the need for customer focus, pace, experimentation, iterative regular development, and cross-functional teams. Almost all teams across organisations benefit from this approach.

We want to set up a Project Management Office to increase governance but our tech and product team is resistant. Why?

The desire to set up a PMO office is often a symptom of a wider organisational problem. In our experience, it can often signify:

- There are concerns about delivery. However, setting up more bureaucracy rarely results in faster delivery.

- There is poor communication from product and engineering. These teams can sometimes be guilty of keeping their heads down to deliver great software and neglect internal communications. This can easily be solved by asking your product team to ensure a regular communication cadence which can include updates, show and tells, or regular strategy presentations.

- Other teams are unhappy with aspects of the product team. Again this can be a normal reaction when organisations are going through transformation. Beware burdening Product and Engineering with additional governance procedures as these often result in projects becoming political footballs within your organisation.

I am not clear why certain projects get picked above others?

Your product team needs to have a clear and transparent prioritisation process. This should nest with the company’s objectives and KPIs for the year ahead. The product strategy should be part of the overall strategy. Done well, it should be very clear why certain projects get chosen above others. But remember, product teams also need to spend a certain percentage of time on maintenance and addressing technical debt. This can be around 25% of effort and should be done regularly to ensure minimal disruption to the business

What Product is not

Product and engineering are not service departments that just take and process requests. It is their role to marry the customer needs and the business needs to create optimum impact.

Product is not taking bespoke requests from customers to close contracts, under pressure from a sales team. On the flip side, Product is not insisting on discovery work when a product or service has already been sold to a customer who has a very clear idea of what they are getting.

Product is not just executing a solution. It is about identifying the right problems to solve with the most effective solutions. Be warned, product teams will almost always ask ‘What problem are you trying to solve’ when somebody asks for a new feature.

Product is not only about customer needs. Just because an initiative may improve a metric or improve things for the user, does not mean it should automatically be done. A strong product team understands opportunity costs and finds the best ideas.

Product is not a silo. As a team, product works across the entire organisation - from finance, to sales to marketing and beyond. It is probably one of the few departments in an organisation that works across almost every team. But that brings challenges. Many product managers would probably love to work in isolation with their sprint team - but they don’t because they know a cross functional approach is best for the customer and the business.

Examples of how AKF Partners works with product organisations

Here are a few examples of recent projects:

- Building a product operating model for an international organization to establish a clear product cadence across the company

- Running a joined-up product and technology strategy process, working with Chief Product Officer and Chief Technology Officer. We also run Product strategy training for teams

- Aiding hypergrowth companies establish high performing and scalable product and engineering organizations

- Work with CEO to conduct short assessments that includes technology, product, process and people

- Support and coaching for tech leaders, especially when doing strategy, building a new team or transformation

- Training sessions for boards and executive teams on how to become a product and technology-focused organisation

If you want to read more

Hopefully we have piqued your interest in all things Product. If you want to read more, we would recommend our recent blogs on:

Adaptive Product Teams

Key skills for adaptive product teams

Checklist for aligning product management and engineering

Top ten product discovery mistakes