The Productologist

Steve Kaufmann posted an article over at Dumb Little Man about how not everything requires How-To manuals. The post covers a variety of areas, but one struck me as especially relevant for Product Managers–

“I worked for two large corporations in the 1970’s and 80’s. They were both established leaders in their field. Millions of dollars were spent in meetings, studies, Return on Investment(ROI) analysis and more studies, usually resulting in the decision not to go forward. Neither company exists today.” -Steve Kaufmann of LingQ

As Product Managers, we are frequently charged with formulating a plan for either existing or new products. As part of that plan, we have to provide data (sometimes reams of data) supporting our recommendations. Input from Sales and Support, market trends, and competitive analysis are all part of the deal.

But what if all of that analysis hindered us or led us down the wrong path. A manager of mine from a few years ago used to refer to it as “Analysis Paralysis.” She said that was one of the main reasons that she didn’t like working at big companies. She liked being in a position where she could make decisions instinctively and then execute them without having to justify every step.

In larger organizations, using data points to support your analysis is a necessity unless EVERYONE considers you an expert in the target market (and even then, it’s best to have at least some data that corroborate your position). However, the right amount of data is a small target which can be difficult to quantify. Too few data points and you won’t be able to substantiate your plan. On the flip side, too many data points and there will be so much noise that it will be difficult to differentiate betweeen patterns and outliers.

Steve makes the case for making a decision based on fewer data points and then correcting along the way to refine the plan and keep it aligned with corporate and market drivers.

“I have now had my own company since 1987. The “gut-feel” decisions are the ones that really worked for me. I made my way forward and adjusted as I went. Dealing with the mistakes we made was what strengthened our company in the long run.” -Steve Kaufmann

If you work in a small team or have a level of autonomy that lets you control most of the product strategy, then you can likely use the gut-feel method that Steve prescribes, but in a larger organization, especially one where millions of dollars are going to be invested in the research, development and execution, you will likely need to have more than that to get any buy-in from the management team.

I personally have used the gut-feel method, successfully and not. gut-feel is great when you need to make a quick decision and you have a fair amount of information about the issue. What is a fair amount? If you feel that you could walk in to your CEO’s office and feel comfortable explaining your rationale, then you have enough information. If you cannot, then you don’t. The other side of that coin is if you feel you have to put your rationale into a presentation or document, then you have too many data points.

Whether you choose the gut-feel method is largely determined by the make up of your company or organization and your personal comfort with variability. If you don’t mind walking through a door where you don’t know what’s on the other side, then you might try the gut-feel method. If that’s not your style, maybe try it on something small and see how it feels (and works out).

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This entry was posted on Thursday, February 21st, 2008 at 7:38 am PT and is filed under Processes.You can follow any responses to this entry through the RSS 2.0 feed.You can leave a response, or trackback from your own site.