Review

The process of product execution is easy to explain. There’s a plethora of off-the-shelf activities, processes and frameworks new product managers can apply. Product strategy though is more elusive. Although it’s easy to frame it’s hard to do, as each situation is different. As a result product strategy books can leave you feeling a little lost. Product Direction does a commendable job of defining a step by step guide to creating a product strategy, defining a strategic roadmap and setting OKRs.

This book borrowed many of Richard Rumelt’s ideas outlined in Good Strategy / Bad Strategy and made them more practical. However, after this book was published he released ‘The Crux’ which attempted to do something similar.

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The Crux

I’m predicting this book will become a business classic. It is one of the best books on business strategy that I’ve come across. Good Strategy/Bad Strategy (it’s predecessor) had me agreeing with the theory, but I was left wondering how to put it into action. This book addresses that and gives you a framework to follow to create your strategy. This book can stand alone, so I’ll be recommending this ahead of Good Strategy/Bad Strategy from now on.

andrewclark.co.uk

Book Review and Summary: Good Strategy/Bad Strategy by Richard P. Rumelt

Get a comprehensive review and summary of the best-selling book "Good Strategy/Bad Strategy" by Richard P. Rumelt, the strategy expert and author. Learn about the key principles and practices for creating effective strategies and achieving your goals.

andrewclark.co.uk

Book Review and Summary: Strategize by Roman Pichler

Get a comprehensive review and summary of the best-selling book "Strategize" by Roman Pichler, the product management and strategy expert. Learn about the key principles and practices for developing and executing effective product strategies.

andrewclark.co.uk

Key Takeaways

The 20% that gave me 80% of the value.

• Product strategy is selecting the right problems to solve and breaking them down into actionable opportunities, and measurable objectives
• Sequence: set product strategy → define your strategic roadmap → set your objectives and key results
• Strong product strategy helps with alignment, autonomy, focus and scale
• Why companies fail at product strategy:

Lack of method	Frequent changes in direction	Lack of accountability
Lack of insight generation	Lack of focus	Poor Communication
Doing it at the wrong level

Product Strategy

• Your strategy should describe a path to achieving the product vision
• The product strategy should direct focus toward a set of opportunities and activities that will support the company aspiration
• The components of product strategy:
• A diagnosis of the situation
• A subset of opportunities/problems that you’re focusing on
• A set of guidelines for execution
• Find the goldilocks level for your strategy (it can’t be high-level or low-level)
• Too high: Increase sales by 20% (no direction, no guidance)
• Too low: 50 strategic projects for the year (no focus, too restrictive, output-led)
• You’ll need to generate and digest a bunch of insights about your company, customers and product to identify the right direction

	Definitions (previously decided)	Results (usage and performance data)	External (What’s happening elsewhere?)
Company	Vision & Mission	Company KPIs	Industry Reports
Customers	Segments + Needs	Customer Feedback	Customer Research
Product	Product Vision	Product KPIs Technology Status	Benchmark

• Involve enough people to balance strategic thinking with detailed knowledge of product initiatives and results. There’s a tradeoff between having all the insight and having too many people involved.
• You might need to introduce a two-layer strategy:
• Portfolio-level: management setting high-level, key focus areas and resource allocation
• Product-level: product teams aligning but identifying their own opportunities
• You should co-create strategy with stakeholders, but to avoid paralysis, consensus through compromise and group think you should get thoughts and insight in advance and have communication and feedback sessions afterwards
• Review product strategy continuously, with a 12-18 month horizon

Product Strategy Creation Process

• Gather information → collate insights → select → goals → synthesis → communicate
• Step 0: Gather information
• Strategy definition should start with a summary of critical information
• Data should be curated, distilled and presented so it’s easy for others to understand why it’s important
• Gathering data that’s relevant to product strategy should be a continuous ongoing effort
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Divide and conquer on providing key inputs

	Product Level	Company Level
Company Results	Head of Product	CPO
Customer Research Results	Product Designer	Head of UX
Customer Feedback	Product Designer	Head of UX
Product Behaviour Results	Product Manager	Head of Product
Benchmarks	Product Manager	Head of Product
Product technical status	Tech Lead	CTO
Industry Reports	Everyone	Everyone

1. Tap up stakeholders and partners that could have valuable information or benchmark comparisons
• Step 1: Insights
• Select the right insights to focus on (from the information you collected)
• Start by generating as many insights as possible
• Look only for problems, trends or opportunities that can radically change the game
• An insight is a learning with a high potential to impact our users’ needs and business results
• You’ll already have insights → so this about combining and clarifying them
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Use insight generation frameworks to help you come up with and frame insights:
• Sources of innovation (Peter Drucker)
• 10 types of innovation (Larry Keeley)
‣
Core Value proposition and ERRC *Best*
• Benchmark your offering to competitors → identify your core value differentiation
• Porter’s Five Forces analysis
• List characteristics most valued by customers (e.g. price, speed, security, comfort, convenience) → plot how you compare vs competitors/substitutes/alternatives
• ERRC (Eliminate, Reduce, Raise, Create) to decide which factors to focus on {from Blue Ocean Strategy}
‣
Opportunity Solution Tree (Teressa Torres) *Best*
• OST helps you organise discovery options and consider multiple alternatives for each desired outcome
‣
Impact mapping:
• The initial part of impact mapping helps visualise how opportunities link to goals and actors within your product portfolio
‣
The three horizons of growth (McKinsey) *Best*
• Divide ideas by time horizons:

Horizon 1	Preserve the current business. Earnings horizon of 0-12 months.
Horizon 2	Expand into adjacent and emerging new businesses. 1-3 years.
Horizon 3	Disruptive future bets. Could create new business 3+ years out.
• Others: Kano Model, SWOT analysis, BCG matrix, Porter’s 5 forces, McKinsey 7S
• Others: Business Model Canvas, Value Proposition Canvas
• Expected output: many insights, organised and grouped, a shared understanding
• Step 2: Select:
• Focus energy on one for very few pivotal objectives, that if accomplished will lead to a cascade of favourable outcomes.
• Focus on the most promising strategic drivers → make sure you understand the necessary trade-offs of pursuing them
1. Decide which insights will have the biggest impact on results
2. Understand how they interact together
3. Align the selection with the resources available
• Align the entire organisation to the differentiation we wish to have on our customers’ value proposition
• If your insights / paths don’t align to the goals of your organisation flag it
• Decide on a strategy for winning OR you’ll fail to make the resource investments and commitments required to become the leader in your segment
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Selection Tools
• Review the current strategy
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Strengthen the core using your dynamics
• Select and group those insights that enhance your current core business and value proposition
• Use your dynamics: harness a position of advantage → strategic advantages are hard to achieve → once you have them → strengthen your position, and lean in to make the differentiation more clear → exploit their potential
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Google’s 70/20/10
• 70% of resources to the core business
• 20% on emerging opportunities
• 10% on new bets → high risk, high potential payoff
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Gibson’s DHM framework
• Gibson Biddle → Definition of what product leaders ought to be doing:
• to Delight customers
• in Margin enhancing
• and Hard to copy ways
• Analyse each opportunity through this lens → mark each insight against the 3 criteria
• Make sure your selections create alignment
• You’re strategy should be cohesive and align the company toward a particular positioning. Are your selected options compatible?
• Do they all point in the same direction? E.g. don’t try to enter a new market and reduce costs at the same time
• Avoid inconsistency if you can! If not communicate it
• E.g. cut costs except those that relate to new market expansion
• Exceptions like this in strategy make it harder to communicate and implement
• Step 3: Goals and Assumptions
• Selection of which insights to target requires you have an expected outcome ahead of time
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Defining a measure of success can help with insight selection

Opportunity	Target	Assumption	Failure prob.	Impact
Insight name	The KPI and its desired value	What needs to be true to achieve the results	How likely is this to fail	How badly a failure affects the result

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If you select an insight you’re taking a risk that your assumptions will be wrong. So note your assumptions and set your confidence accordingly
• note key assumptions during the selection phase
• vary in confidence based on what you know and how much discovery you’ve done
• uncertainty depends on volume of evidence
• you can score each assumption for risk →based on likelihood vs impact
• You can’t compare emerging opportunities to the company’s core sources of revenues
• Step 4: Synthesise
• Create an artefact that will make your strategy clear and memorable
• Don’t just present a list of problems to be solve. Explain why tackling them crucial? What’s the root cause? What impact will you have on your customers and business if you solve them?
• To make it memorable → tell a story and use visual elements
• Synthesis frameworks:
• Listing key drivers and key results
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The kernel (from Richard Rumelt)
• The kernel = a diagnosis, guiding Policy, coherent Actions
• Defining diagnosis → understanding what’s going on, providing insights on how things are, a compelling why for the subsequent steps
• Guiding policies → indicate the direction selected to tackle the opportunities or solve the chosen problems → without stating a specific action → provide a clear context but gives some freedom for how to execute
• Set of coherent actions → express the most relevant actions, that help you execute and reach the desired outcomes (avoid detailing the activities for all teams)
• What to include in a strategy document
• Try and describe the process that you went through
• Things you could cover
1. A refresher on the company and the product
2. Diagnostic information (point out key info and different sources)
3. Insights and selection
1. Guide them through options that you’ve identified
2. Be clear about the why. Articulate the importance.
3. Say what you won’t do!
4. Resulting direction
• describe the strategy with a single memorable image
• the centre-piece of the communication
5. What good looks like
• KRs or KPIs
6. Resources and other considerations

• For strategy to be successful people need to know it and understand it
• Involve stakeholders, either by ‘co-creation and debate’ or ‘proposal + feedback + adjust’
• Think about your stakeholders needs. Their goals, challenges and concerns. What implication does the change have for them.
• Build a shared understanding. Before selection, everyone needs to share the same vision of what you’re trying to achieve. Verify everyone is on the same page before progressing.
• Reach agreement through reliable data, and experiment (key assumptions need to be validated)
• Broadcast to the organisation after validating with stakeholders. Tailor communication to different groups
• Iteration and feedback on your strategy
• You can’t wait 18 months to see if your strategy is working
• Think about how you can validate over different time periods

Co-Create Strategy	Communication Feedback	Experimental Feedback	OKR Results Feedback	Strategy Results
	Immediate	1 month	3 months	18 months

• Four Aspects of strategy evaluation (from Rumlet Essay)

• When assessing OKR results, you need to determine if they’re down to…
• the chosen strategy → requires a pivot
• the selected solution → update approach with new insight
• or the execution of the solution → stick to strategy but make changes in execution

Strategic Roadmap

• A communication tool that is a statement of intent and direction
• shows your direction and how you’ll get there
• defines major outcomes and milestones/steps to achieve them
• It’s not a binding plan → just a guide for communication
• Project plans hide the uncertainty of creating products that achieve
• Inputs for consideration:
• Product Strategy: Use the drivers as inputs and unpack into smaller chunks
• Current roadmap: Are things still relevant?
• Current team structure and definition
• Who to involve:
• People with the information and responsibility BUT don’t involve too many people
• Product Leadership + Technical Leadership + Discipline Managers + Helpful Stakeholders
• What cadence:
• A roadmap is an expression of strategy so can last 12 months
• Leave room for experimentation and learning
• Top-up or Bottom down:
• Balance allowing autonomous product teams to pursue bottom up goals WITH aligning the organisation to achieve a strategy
• The closer you are to product execution → the more influence leadership should give the team
• Portfolio roadmaps are an opportunity to organise and select relevant themes → allowing you to signal the scale and significance of each theme and how you’re allocating resources to it
• Process: Roadmap structure → strategy grooming → priorities & timelines → comms & feedback
• Roadmap structure 80/20:
• Use more precise timelines and descriptions for closer period, make periods longer into the future (E.g. Q1, Q2, H2, NY)
• Write roadmap elements as challenges (opportunities and problems not solutions)
• Reflect all work
• Granularity should be close to execution but allow enough room for to discover and experiment with solutions
• Strategy grooming 80/20
• Break problems into opportunities at a lower level of definition
• Discovery work allows a higher level of detail and confidence
• Abstract opportunities are OK in the medium term or longer term.
• The LRM (Last Responsible Moment) → an agile principle to defer making analysis or decisions for items until required.
• You can use opportunity trees or customer journey maps to arrive at roadmap items
• OSTs are good for mapping alternatives and choosing the best
• Journey maps are good for creating opportunities all over the place
• Use slicing to make things fit:
• By segment, geography, activities, workflow, variations
• Include mandatory non-strategic work
• Take time to write things in a way they can be understood by others
• Priorities and Timelines
• Ideally you determine the priority of each item and sequence them through time
• Consider effort, resources, dependencies and uncertainties
• Don’t use value vs effort (we’re bad at estimating) → use evidence gathered instead
• Don’t prioritise items in future horizons.
• Split bigger pieces of work across Now/Next/Later
• Prioritise by strategic outcome (use your strategy selection input to prioritise the elements). Use your hypothesis and your expected outcomes to prioritise what will be more meaningful
• How do you set time frames? → Guess when you’re going to achieve the outcome → allow for iteration, experimentation and other unpredictable items
• Don’t rely on confidence level for prioritisation, as we favour less risky more certain things. Instead, direct discovery to uncertainty
• Embrace uncertainty, prioritise the right opportunities, and move quickly through experimentation to either validate your assumptions or pivot
• Specific software makes things easier in a big organisation but they come at a cost
• Consider resources:

Resource Diagnosis	Action
Move faster in chosen direction	Reallocate resources or demote priority of other opportunities
Overloads and under-loads detected	Balance resources reflecting new strategy
New area of work not currently owned	Give ownership to an existing team or create a new one

• Many leaders fail to to accelerate in a chosen direction by reallocating resources by inaction
• Communication and feedback 80/20
• Share your roadmap widely:
• What are you trying to solve?
• Why have you chosen this order for opportunities?
• Why are you following this time frame?
• Get high-level agreement before broad meetings
• Roadmaps attract more pushback than strategy
• Include a ‘possible solutions field’ to make it clear you’re going to test or look into a certain approach
• Alignment
• Let other teams know what you need form them
• Let other teams know what they can do to help with the strategy
• Think marketing, operations, legal and finance
• Roadmaps should be live, update others when you learn more or something changes

Objectives and Key Results (OKRs)

• OKRs combine aspirations and associated metrics
• OKRs support your product direction and help create autonomous, independent and orientated product teams.
• OKRs provide the necessary context for anyone from any department to understand what a team or individual is trying to achieve
• I will (objective) as measured by (set of Key Results)
• Objectives: are an aspirational goal to achieve → they set a clear direction and can help motivate teams
• Key results: Are both a metric and a target value. They help teams know if they’re going in the right direction.
• KRs are precise, measurable and verifiable
• Should be achieved by a specific point in time
• Challenging → set goals which are a stretch. A good score is 70% not 100%.
• Create focus → by having only a small numbe

• Product-Area OKRs can help provide teams with clear strategic directions BUT they can also result in confusion and duplication
• Basic steps: set → check-in → final evaluation
• Creation Phase: Four steps over a few weeks.
• Area and teams drafts
• Dependencies and feedback loops
• Final values and quality review
• Inputs to OKRs: Strategic Roadmap + Current Team Structure
• If you think you need to control the goals → you need to provide more strategic context to the team
• Area Draft → team draft → dependencies management → final version → regular checkins

• KPI trees help visualise and explore what sub-metrics will impact your desired outcome
• Make sure you’re using the KR that is most specific to the problem you’re trying to solve
• Selecting a leading indicator is making an assumption that it will change the desired outcome
• Segments can help create better KRs
• Get teams to self assess the quality of their OKRs

• Attempts at managing complex dependencies such as the Scaled Agile Framework Enterprise (SAFe) end up obstructing the intention to create autonomous and empowered teams. Most successful product organizations opt for finding ways to reduce the amount of coordination required, investing in architectures and practices that provide teams autonomy.
• Official updates serve as a trigger to change plans and elevate awareness of off-track goals
• OKR review results can lead to…
• No new action (goals are on course)
• Normal plan modification (changing plans and tactics but targets remain the same)
• Eliminate, change or add objectives (given current results or an extraordinary situation)
• → in this instance changing is better than persevering with an impossible goal
• There should be NO process to change the OKRs… teams should just be empowered to change them and keep everyone aligned (especially dependent teams

Deep Summary

Longer form notes, typically condensed, reworded and de-duplicated.

Preface

• Our goal is to build impactful solutions to challenging problems, but most of the time, we don’t achieve the desired results.
• Product Direction is about
• Selecting the right problems to solve
• Breaking them down into actionable opportunities, and measurable objectives
• Product Direction is a practical approach to defining, linking and communicating your product strategy, strategic roadmap and objectives → to help align, focus and scale your product organisation’s impact
• Leverages OKR method
• People and teams can interpret a vague vision differently, misalignment occurs and you fail to make the impact you hope.

• Benefits of the approach:
• Team alignment and autonomy. All teams focus on achieving the vision through the right path
• Focus and positioning. Selecting and committing to the opportunities deemed to provide the best results → saying no to the rest of them
• Scale and consistency. Autonomy and alignment enable you to scale and maintain speed and success
• Shared practices, tools, artefacts, communication methods, transparency

Section 1. Setting the product strategy

Chapter 1.1 : Introduction to strategy

• Product strategy is the bridge between your vision and your expected outcomes.
• Product strategy includes…
• a diagnosis of your situation
• a subset of opportunities / problems that you’re focusing on
• a set of guidelines for execution
• Why organisations fail at product strategy
• Lack of method
• Lack of accountability
• Lack of insights generation
• Constant changes in direction
• Lack of commitment / focus
• Poor communication
• Doing strategy at the wrong level of detail
• Doing product strategy at the right level
• Too high level → increase sales by 20%
• there’s no direction to take
• there’s no guidance on how to achieve it
• Too low level → 50 strategic projects for the year
• too restrictive, likely output-led not outcome-led
• Your strategy should describe a path to achieving the product vision
• Vision Templates:
1. Your vision should describe the positive and customer-focused change the product will generate in the next 3-5 years by magically solving hard and enduring problems
2. For (target customer) who (need statement), the (product name) is a (product category) that (key benefit statement / compelling reason to buy). Unlike (primary competitor alternatives), (product/brand name) (primary differentiation statement)
• Your product strategy should align with the company’s vision, aspirations and strategies → such that it helps the company achieve them
• YouTube great multi-year ambition: 1B hours of watch time per day by 2016
• Depending on the age of a company, you might have different objectives:
• Early stage: rapid growth, user acquisition and activation
• Late stage: margin, profitability
• Mature: expand into new segments, geographies, categories
• The product strategy should direct focus toward a set of opportunities and activities that will support the company aspiration

Chapter 1.2 : The Process of Strategy Creation

• You’ll need to generate and digest a bunch of insights to identify the right direction
• Definitions: Things previously decided
• Results: Usage and performance data
• External: What’s happening elsewhere? Competition, new trends etc.

• Nine things to know:
1. Vision and Mission Statement → so you know where you’re going
2. Customer segments, personas and needs → so you know who you’re serving
3. Company results → KPIs, lifecycle stage
4. Product results → AAARR metrics, behavioural analytics
5. Customer feedback → Customer sat, customer service insights, social mentions. Correlate to product performance
6. Customer research → Qualitative research to tell you why things are happening, discover unmet needs.
7. Market & Industry analysis → to understand the landscape, market growth, competition, trends, data
8. Benchmark → Results and performance of competitors. How do you compare to best in class? Compare not just to competition, but substitutes, different industries and insurgents/disruptors
9. Technology status → technical debt, ability to scale, performance, investments required
• Who to involve?
• You need to balance strategic thinking with detailed knowledge of product initiatives and results
• Product leadership + CTO + Tech Leadership + Product Managers
• There’s a tradeoff between having all the insight and having too many people involved
• You need to have somebody accountable for the plan, take authority and make final decisions (CEO, CPO or VP of Product)
• Two levels of strategy:
• Portfolio level:
• High-level, senior people. Identify key focus areas (problems / opportunities) and resource allocation.
• Set a direction that teams can align to impact.
• Product level:
• Product teams align themes to portfolio. Involving team members (not managers)
• Identify opportunity from discovery, benchmarks or experiments
• Even with a portfolio/product level split, decisions made at each level affect the other level
• Stakeholders should be part of strategy co-creation
• Keep them in the loop
• Get their valuable insights and feedback
• Keep them motivated by involving them
• BUT a 50 person debate → paralysis, consensus through compromise and group think → prevents breakthroughs
• So get thoughts and insight in advance → have communication and feedback sessions afterward
• It is beneficial to have somebody responsible for the portfolio strategy → product managers in turn should be responsible for the product strategy
• Cadence:
• Depending on your industry. A 12 to 18 month product strategy is fine.
• Review continuously to incorporate new learnings and discoveries
• Unexpected results might make a pivot necessary
• Strategy Creation Process:
• Gather information
• Collate insights
• Select
• Goals
• Synthesise
• Communicate

Step 0: Gather Information

• Gathering data that’s relevant to product strategy should be a continuous ongoing effort
• User, business, market, competitors, macro-economic conditions etc
• Strategy definition should start with a summary of critical information
• You’ll need to divide the inputs… make it explicit who come with each piece of information

• Tap up stakeholders and partners that could have valuable information or benchmark comparisons
• Data should be curated, distilled and presented so it’s easy for others to understand why it’s important

Step 1: Insights

• From that information, you need to select the right insights to focus on.
• Generate as many insights as possible → to choose the most promising opportunities later
• But we’re only looking for problems, trends or opportunities that can radically change the game
• An insight is a learning with a high potential to impact our users’ needs and business results
• You’ll already have insights → so this about combining and clarifying them
• Insight Frameworks
• Internal vs External

	Business	Customer
External	External Business Insight Business Model Change E.g. low cost airlines	External Customer Insight Consumer Behaviour E.g. Streaming services
Internal	Internal Business Insight Automation (how you use tools) Repositioning (internal capability as a business) E.g. Amazon AWS	Internal Customer Insight Product Behaviour E.g Facebook > 7 friends

• Sources of innovation (Peter Drucker)
• Inside sources:
• Has anything unexpected happen? A surprise success or failure? That could lead to an opportunity?
• Any pains customers still have with the product?
• Can any processes be improved?
• Are there any major shifts in industry or market? (disruptions or trends)
• Outside sources:
• Are our customers changing, or is there a variation in segment’s size?
• Has people’s perceptions changed? Can that be leveraged?
• Any breakthroughs in technology or other fields that can be implemented?
• 10 Types of innovation (Larry Keeley)
• Three areas of opportunity:
• The configuration of the business model and operation
• The offering, the value the product provides
• The experience the customer receives from the company
• Insight Tools
• List your insights → generate ideas with impact
• Spark creativity and introduce options you wouldn’t always consider
• Focus on previous insights
• Tool 1: Core Value proposition and ERRC
• Benchmark your offering to competitors → identify your core value differentiation
• Porter’s Five Forces analysis
• List characteristics most valued by customers (e.g. price, speed, security, comfort, convenience) → plot how you compare vs competitors/substitutes/alternatives
• ERRC (Eliminate, Reduce, Raise, Create) to decide which factors to focus on {from Blue Ocean Strategy}
• Tool 2: Opportunity Solution Tree (Teressa Torres) or Impact Mapping
• OST helps you organise discovery options and consider multiple alternatives for each desired outcome
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Diagram

• The initial part of impact mapping helps visualise how opportunities link to goals and actors within your product portfolio
‣
Diagram

• Both tools encourage you to think about outcomes, and generate multiple alternative ideas (increasing the chance a desirable path will emerge)
• Tool 3: The three horizons of growth (McKinsey)
• Divide ideas by time horizons:

Horizon 1	Preserve the current business. Earnings horizon of 0-12 months.
Horizon 2	Expand into adjacent and emerging new businesses. 1-3 years.
Horizon 3	Disruptive future bets. Could create new business 3+ years out.

• Other tools:
• Kano Model, SWOT analysis, BCG matrix, Porter’s 5 forces, McKinsey 7S. ]
• Business Model Canvas, Value Proposition Canvas
• Expected output:
• A wall of insights
• Organised insights
• Shared understanding

Step 2: Select

• Focus energy on one for very few pivotal objectives → that if accomplished will lead to a cascade of favourable outcomes.
• Focus on the most promising strategic drivers → make sure you understand the necessary trade-offs of pursuing them
• Process:
1. Decide which insights will have the biggest impact on results
2. Understand how they interact together
3. Align the selection with the resources available
• Selecting is about focus and positioning
• Align the entire organisation to the differentiation we wish to have on our customers’ value proposition
• → base that on the insights and opportunities identified
• It’s more than prioritisation → you need to have an understanding of your goals, and the assumptions / risks of each path
• Consider alignment to goals
• Ideally your insights / paths align to your goals and you can select the best
• BUT…
• You might not have clear goals to align to
• You might surface opportunities that conflict with your goals. (e.g. you didn’t plan to expand into a new country, but you’re getting enquiries from customers there)
• If so raise the issue with the CEO and other stakeholders
• Selecting to win
• Playing to win → decide on a strategy for winning OR you’ll fail to make the resource investments and commitments required to become the leader in your segment
• Select a strategy that will enable you to dominate a niche market OR compete based on a key attribute that customers value highly
• Tools for selection
• The current strategy is obviously a useful consideration
• As are some of the insight tools identified earlier
• Selection Tool 1: Strengthen the core
• One of the most useful tools
• Select and group those insights that enhance your current core business and value proposition
• Apple’s ecosystem of services strengthened it’s core device business, and helped all of the devices play nicely together
• Use your dynamics → harness a position of advantage → strategic advantages are hard to achieve → once you have them → strengthen your position, and lean in to make the differentiation more clear → exploit their potential
• Write your product offering in the middle of a whiteboard
• Place the most valuable insights around the centre
• Connect your insight to offering → say how that insight improves your core offering
• Connect your offering to your insight → how your core value makes this opportunity more attractive and likely to achieve
• Then remove orphan insights → that you can’t connect to the product offering
• Then make selections based on the desired outcome
• Selection Tool 2: Google’s 70/20/10
• 70% of resources to the core business
• 20% on emerging opportunities
• 10% on new bets → high risk, high potential payoff
• Selection Tool 3: Gibson’s DHM framework
• Gibson Biddle → Definition of what product leaders ought to be doing:
• to Delight customers
• in Margin enhancing
• and Hard to copy ways
• Analyse each opportunity through this lens → mark each insight against the 3 criteria
• Alignment Filter
• Select your most promising ideas to solve
• You’re looking for a cohesive strategy that aligns the company toward a particular positioning
• Are your selected options compatible?
• Do they all point in the same direction?
• E.g. don’t try to enter a new market and reduce costs at the same time
• Avoid inconsistency if you can! If not communicate it
• E.g. cut costs except those that relate to new market expansion
• Exceptions like this in strategy make it harder to communicate and implement

Step 3 Goals and Assumptions

• Selection of which insights to target requires you have an expected outcome ahead of time
• Defining a measure of success for each insight can help with selection too

• If you select an insight you’re taking a risk that your assumptions will be wrong
• note key assumptions during the selection phase
• you’ll vary in confidence based on what you know and how much discovery you’ve done
• external insights are often more fragile than internal ones
• Evaluating assumptions
• key assumptions need to be proven right to prove your hypothesis
• carefully frame the risk associated with each assumption
• score based on likelihood vs impact
• Allocate a score of 1,2,3,4,5 and then multiply them
• E.g. Likelihood 5 x impact 5 = 25
• uncertainty depends on volume of evidence
• Time horizon consideration
• Opportunities in the second and third horizon can’t be quantified in the same way
• You can’t compare emerging opportunities to the company’s core sources of revenues.
• Don’t fall into this trap and kill emerging opportunity due to lack of early results
• Look at growth and retention rates not just revenue for new ventures
• Validated Learning (Eric Ries), Build Measure Learn
• The goal is to get tangible confirmation or rejection

Time Horizon	Goal type
1st: Core business	Normal Goal, North Star
2nd: Expansion	High growth and retention
3rd: Bets	#of validated learnings, early transaction

• High Level Resource Understanding
• Your selection must realistically reflect your ability to execute those items when the time comes
• Effort = resources, time and scope
• There’s little precision at this point

Step 4 Synthesise

• Synthesis involves creating an artefact that will make your strategy clear and memorable
• Don’t just present a list of problems to be solve. Consider…
• The Why → Why is tackling them crucial? What’s the root cause? What impact will you have on your customers and business if you solve them?
• Story telling → convey a story, explain where you’re coming from, what you intend to do, and how the future will look
• Visual → use visual elements to make the strategy look memorable
• Synthesise Tools:
• Tool 1: Drivers Model
• 3 to 5 pillars/drivers are shown in a single image
• Elements:
• The drivers: expressed in one or a few words
• Description of drivers: super concise, the driving force behind the idea (c.30 words)
• The expected outcome of each opportunity
• Optional supporting principle.
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Visual Example:

• Tool 2: Kernel (From Good Strategy, Bad Strategy)
• The three elements of a kernel:
• Diagnosis, Guiding Policy, Coherent Actions
• Defining diagnosis → understanding what’s going on, providing insights on how things are, a compelling why for the subsequent steps
• Guiding policies → indicate the direction selected to tackle the opportunities or solve the chosen problems → without stating a specific action → provide a clear context but gives some freedom for how to execute
• Set of coherent actions → express the most relevant actions, that help you execute and reach the desired outcomes (avoid detailing the activities for all teams)
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Visual Example

• Completing the strategy document:
• Try and describe the process that you went through
• Things you could cover
1. A refresher on the company and the product
2. Diagnostic information (point out key info and different sources)
3. Insights and selection
1. Guide them through options that you’ve identified
2. Be clear about the why. Articulate the importance.
3. Say what you won’t do!
4. Resulting direction
• describe the strategy with a single memorable image
• the centre-piece of the communication
5. What good looks like
• KRs or KPIs
6. Resources and other considerations
• Artefacts you should now be able to produce:
• A strategy document
• A deck to go through during communication sessions
• A one-pager to hang on the wall

Strategy communication

• For a strategy to be successful everyone needs to know about it and understand it
• A strategy that isn’t known or understood is useless

• Think about how best to involve your stakeholders in the strategy process.
• You can get there help at the insight and selection stage
• If you commit to a direction or goal without key members agreeing to it, it will impact the communication phase
• Two different approaches to involvement:
• Co-creation and debate: can help you understand more, and generate high alignment
• Proposal for feedback: after you’ve made your selection, request and be open to feedback
• Think about the needs of your key stakeholders:
• Understand their goals
• Understand their current challenges or concerns
• What does the selection imply for them?
• Build a shared understanding
• during selection everyone needs to share the same vision of what you’re trying to achieve
• present visually
• take time to verify everyone is on the same page
• Reaching agreement
• Convince through reliable data
• Experiment (if there’s a key assumption that can be easily validated)
• Communication Sessions
• After you’ve navigated stakeholders you need to broadcast to the organisation
• Potential structure:
• Top management (consider 121s ahead of the session, validate your storytelling)
• Product leadership team and complete product team (go in-depth, on data and implications)
• Specific product stakeholders and groups (various stakeholders / departments)
• Look for other ways to reinforce your message
• On the walls
• Link to drivers in goals or initiatives (Objective → Goal)
• Linking everything you’re doing day to day encourages people to keep reading the strategy
• Repeat the message → don’t rely on a single session

Iteration and feedback loops

• A well crafted strategy will provide clarity of direction for 9 to 24 months
• You can’t wait that long to see if your strategy is working
• Use short feedback loops to verify your hypothesis early
• Update your understanding of the situation, tweak direction if needed
• When validating strategy:
• Start simple: survey participants
• Later: run experiments and iterate our hypothesis
• Then execute: see if you hit your quarterly goals at scale
• Different feedback loops operate at different speeds. Use them all:

• Four Aspects of strategy evaluation (from Rumlet Essay)

• Immediate Feedback (Qualitative Assessment)
• A survey to evaluate the 4 desirable attributes of strategy
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19 Question Survey (use the Likert scale)
1. (Consistency) The strategy is aligned with the vision
2. (Advantage) The strategy strengthens the core value proposition
3. (Consistency) The strategy helps increase the value we provide based on the needs of our customers
4. (Consonance) The strategy considers our current users’ feedback
5. (Consonance) Industry trends have been considered
6. (Consonance) Competitors benchmarks have been considered
7. (Consonance) The strategy takes advantage of and considers differentiation based on the company’s strengths
8. (Consonance) The strategy considers the latest company results
9. (Consonance) The strategy is based on the current market conditions (share movements, competitors, margin trend, and so on)
10. (Feasibility) The strategy is aligned with existing resources and capabilities
11. (Feasibility) The strategy considers the required investment in technology renewal and maintenance
12. (Consistency) The strategy considers current and future financial needs
13. (Feasibility) The strategy presents clear goals to be achieved
14. (Feasibility) The level of risk in the strategy is appropriate for the company’s risk appetite
15. (Advantage) Sufficient alternatives were considered before selecting the current strategy
16. (Advantage) The strategy will generate value for the current period as well as future ones
17. (Advantage) The strategy creates or strengthens a competitive advantage
18. (Advantage) The strategy provides “strategic drivers” rather than low-level tactical advantage
19. (Communication*) The strategy is easy to understand and remember
1. Make sure everyone has had a presentation and read the document
2. Also ask for feedback about how clearly it was communicated
• Run the survey with three different groups to get different results
1. Answer the questions yourself
2. Ask the extended product team about facts and feasibility
• Get them to add more detail in your presentation
• Get them to find flaws in your presentation
3. Ask stakeholders about business compatibility
• Validate shared understanding or invite challenge
• How have you considered the current financial situation?
• Likely outcomes and corresponding actions
• Unclear topics? → improve message
• Skepticism → more data
• Feasibility → include examples
• Short-term needs → adjust rolling out
• One month in -Experiments
• Start running experiments to validate your assumptions
• Provides useful learning to adapt and improve the direction
• Find the type of test that validates the problem and value of the opportunity
• E.g. problem interviews, prototype tests
• Exploratory interviews create insight for a strategy, but don’t tell you anything how to execute
• A/B tests or usability tests only tell you about the specific solution
• Likely outcomes from experiments and corresponding actions:
• Aligned insight → part of strategy
• New insight → check size and see if pivot
• Invalidating feedback → go back to strategy definition
• Experiment continuously to discover more about the problem and the solution
• 3 months in - Quarterly Objective Results
• Following experimental validation, we should want to see impact in our objectives at the end of the quarter
• Hopefully you’ve scaled winning experiments such that you’re seeing noticeable impact
• Move into progressive implementation
• Validate results at scale with A/B tests
• If your OKRs are linked back to your strategy, you’ll be showing success in a strategic direction
• When assessing OKR results, you need to determine if they’re down to…
• the chosen strategy → requires a pivot
• the selected solution → update approach with new insight
• or the execution of the solution → stick to strategy but make changes in execution
✅
This is a great framework for interpreting Objectives and Key Results
• If you’re not sure what to do, can you create a new hypothesis or experiment that will give you a clear indication?

Section 2: Strategic Roadmap

Introduction to Roadmaps

• Roadmaps can be at the heart of teams failing at execution and causing teams to work like feature factories.
• Different definitions of roadmaps:
• A visualisation of how your product is going to meet objectives → showing the direction of your product and the work required to get it there
• A strategic plan that defines a goal or desired outcome and includes the major steps or milestones needed to reach it
• A strategic communication tool. A statement of intent and direction
• Attributes of a roadmap:
• A strategic plan → order and arrange problems and opportunities and assign them high-level time frames
• Value orientated → not about outputs and deliverables but results
• Communication Tool → the roadmap links product strategy with product execution
• The roadmap paradox / trap:
• Take it as a binding plan → Build exactly what we thought would work 6 months ago (not learning and probably wrong)
• Take it as a guide → change our course and feel like we’ve lied to you
• Contraversial items:
• Time scales → when we don’t know how much effort is involved
• Solutions or Goals → Writing down features/solutions can limit us to a sub-optimal problem, or sub-optimal solution too early
• Level of detail → epics or stories
• Uncertainty over time → future becomes more fuzzy
• Commitment → is this a binding agreement?
• Shift the conversation toward outcomes.
• Barriers to talking about outcomes include: trust, team accountability, reward systems (e.g. celebrating shipping) , embracing uncertainty (experimentation and failure)

Outcome-orientation is the most crucial transformation a product organisation can make and the strategic roadmap can be a keystone artifact

• Roadmap discussions are where strategy meets execution - talking about outcomes not outputs at this stage sets the tone
• Product leaders should keep the discussion centred on the problems we want to solve
• Project plans hide the uncertainty of creating products that achieve outcomes
• Focus on the strategic roadmap:
• In-depth breakdown of strategic drives
• Considering sequencing and milestones that create a path to success
• It should reflect how we plan to achieve the strategy and when we expect high-level milestones to happen.
• Break strategic drivers into smaller problems to solve → identify how many of them to allocate to each team

The Process of Roadmapping

• Start by understanding the …
1. Inputs
• Product Strategy (primary input)
• Use the drivers → unpack into smaller chunks
• Current roadmap
• Are things still relevant?
• Remember to communicate changes to stakeholders
• Current team structure and definition
2. People involved
• Balance involving the right people with the required details and responsibility WITH involving too many participants
• Who should participate?
• Product Leadership, Technical Leadership and Discipline Managers (head of UX. product etc)
• Admit other stakeholders based on balancing helpful input vs decision delays
3. Cadence
• They are an expression of strategy, so items can last 12 months
• We need to leave room for experimental learnings
• Continuously update your roadmap
• Set the problems to be solved but vary the solutions
• Update stakeholders if you change problem
• Top-up vs Bottom Down
• Autonomous product teams should pursue bottom up goals (they are close to the users, metrics and technology)
• BUT we want to align the organisation in a direction → selecting a single path and pass it top down
• Looking to maximise the output of the entire system not just local teams
• We want teams to participate and commit.
• BUT we also need to drive alignment
• The closer you are to the product execution, the more influence you should give the team in decision making.
• Strategy should be top down
• OKRs should be heavily influenced by the team
• Strategic roadmaps should be in the middle.

• Portfolio vs product level
• Portfolio roadmaps enable you to:
• Organise and select relevant themes: which means → you can signal the scale and significance each theme → and how you’re allocating resources to it
• Dependencies → initiatives with more require great care and have a high risk of failure

• Process Steps:

Roadmap structure → Strategy Grooming → Priorities and timelines → Comms & feedback

Roadmap Structure

• You need to select the right roadmap structure

• Reflect the future is fuzzy, but the now is clear
• All roadmaps have a time component (even if it’s Now, Next, Later).
• Use more precise definitions for items in the near future
• E.g. Improve user retention becomes ‘Improve retention over the first 7 days by increasing the click rate of notifications and emails’
• Use more precise timelines for closer periods
• E.g. Q1, Q2, H2 (or ‘next year’)
• Opportunities and Problems, not solutions
• Align everyone to customer and business problems
• Allow room for discovery, to vary the solution and to experiment
• Have a relentless focus on writing roadmap elements as challenges
• Don’t list features, focus on challenges or outcomes
• Goal-orientated
• Strategic goals should always be present (either as lanes or by another visual representation)
• Group things that relate to strategic goals
• Reflect all major work even if it’s not strategic. Anything that consumes a meaningful amount of time and focus should be included.
• Include them because a roadmap is about alignment and communication
• A roadmap isn’t a committed plan → everyone needs to be open-to-changes.
• Don’t invest too long in creating a roadmap → as you won’t want to change it
• Develop the roadmap in an iterative manor → be open to new learnings and changing it
• Axis Definition
• Don’t ignore the power of the axis → use it and define it
• Be consistent with other teams if you can
• Stick to timeframes on the horizontal
• If using time periods…
• Avoid months (too detailed)
• Use quarters for the next couple, but increase further out
• Q1, Q2, H2, NY
• Or use…
• Now, Next, Future
• Can make discussions harder if you need to stick in dates
• Vertical Axis or Lanes
• Use swim-lanes for grouping
• You can use themes (e.g. a customer need the product team should solve)
• You can split themes into sub-themes.
• You could use lanes to represent different products or teams (but that takes you further away from strategy)
• You can group by goals (e.g. increase conversion by 15%)
• In strategyic roadmaps → arrange by strategic goals
• User goals, and then use themes as a secondary division
• OR pick themes that can group goals
• Items/cards in the grid
• Titles vs Cards
• Many roadmaps are screenshots of tools that let you click into a title to reveal more info
• Cards allow you to add other information around the titles, but space is limited so you must agree a format → but you also need to allow some flexibility
• Granularity:
• You need to decide and communicate the level of your roadmap
• Get as close to execution as you can → BUT whilst leaving room to discover and experiment with the best solutions
• Too General: Reduce the ratio of customer service calls per sale by 20%
• Better: Reduce requests for information calls by improving the search-ability and provision of answers online.
• Rules of thumb for scale:
• Be the right size for the time period - allow periods further in the future to be more fuzzy
• They are executable (without being a solution) → a team could easily act upon it
• The impact is measurable → think about affecting a metric and having a quantifiable result
• Wording choice:
• Verbs (improve voucher information), precise nouns (voucher information) or goal orientated (Reduce 10% of information calls by improving vouchers)
• Things to represent visually:
• Stage in the opportunity lifecycle (e.g. problem discovery, solution discover, delivery)
• Cost (e.g. larger items take longer to complete and have a higher cost)
• Categories or groups of items (especially if not used as an axis)
• Ways to represent:
• Colours
• Tags
• Size
• Icons

Strategy Grooming

• Taking your strategy and breaking it down into a roadmap
• Identify the items that will fit each cell.
• Break problems into opportunities into a lower level of definition
• Where you’ve done discovery work already you’ll be able to go to a higher level of detail
• Other areas may need to stay high level, as they’re based on assumptions and require research.
• Abstract opportunities are OK in the medium term or longer term.
• The LRM (Last Responsible Moment) → an agile principle to defer making analysis or decisions for items until required.

Different ways to arrive at roadmap items:

• Opportunity Trees
• Use it to identify multiple insights & map them to high-level opportunities
• Select and synthesise your drives → then lower nodes in the tree can become themes and roadmap items
• Higher level opportunities → themes
• Lower level options → roadmap elements
• Only include those you selected in strategy definition
• The tree helps you map several alternatives and choose the best
• through input analysis or experimentation
• Customer Journey Map
• Describes a set of activities a user undertakes when using a product/service to achieve a goal
• Choose the goals you want to focus on → use the journey map to identify the lower level aspects of the journey that can be improved
• You’re mapping the pains and opportunities to each activity in the journey map
• It can surface different ways to achieve your strategic goals
• See chapter 10 of Mapping Experiences for how to make one
• Customer journey maps result in long detailed conversations → so it can be hard to stay strategic
• BUT it’s great at creating opportunities all over the place
• You might deep dive into one segment of the journey
• Traditional Slicing
• Slicing is used in agile to make user stories small enough to fit iterations while still adding value → you can use the technique at roadmap level too
• Slicing patters:
• User segments (user group A, user group B)
• Geography (Region A, Region B)
• Activities / Operations e.g. purchase, return)
• Workflow (x before y)
• Variations: What are the variations in your scenario? What slicing direction makes the most sense?
• Include other required work → you should always consider mandatory work not considered part of the strategy
• What about tech debt? Three options?
• The 20% rule → make an on going investment and then you don’t need to reflect it on the roadmap
• Show strategic refactors (when tech debt drives or enables your strategy)
• Non-business-strategic required refactors → e.g. moving from monolith to services.
• Take time to write things well
• Keep names short without losing meaning → select the strongest word from an idea
• Make them easy to understand for different audiences
• Follow the same naming structure

Priorities and Timelines

• Ideally you determine the priority of each item and sequence them through time
• Consider effort, resources, dependencies and uncertainties
• 4 methods:
• Traditional Value vs Effort
• Don’t use it
• We’re terrible at estimating value and effort
• Use evidence from discovery instead of guessing value
• Time Horizons
• Items in future horizons don’t require a strict prioritisation
• Include them in their appropriate time frame (the time frame should map when the outcome lands, not when the bet started)
• You can split a longer piece of work across Now/Next/Later if it makes sense
• Priority by strategic outcome
• Use this one
• Use your strategy selection input to prioritise the elements
• Use your hypothesis and your expected outcomes to prioritise what will be more meaningful
• How do you set time frames? → Guess when you’re going to achieve the outcome → allow for iteration, experimentation and other unpredictable items
• Prioritisation (not) using confidence level
• We tend to favour things that are less risky and more certain
• Don’t use this approach → instead direct discovery toward uncertainty
• Embrace uncertainty, prioritise the right opportunities, and move quickly through experimentation to either validate your assumptions or pivot
• App / Spreadsheet and cross team consistency
• Specific software makes consistency easier
• Specific software can integrate with Jira
• Specific software can change the view based on filters or time horizons (using powerpoint or spreadsheets creates a lot of formatting and moving activities to do that)
• Portfolio roadmaps are easier to compile using specific software
• BUT you lose variation and it costs a licence fee
• Considering or not the org structure?
• Considering it allows you to allocate the right amount of work to each team
• But we’re bad at estimating. You need a notion of feasibility but precision isn’t possible
• Different resources / diagnosis and actions:

Resource Diagnosis	Action
Move faster in chosen direction	Reallocate resources or demote priority of other opportunities
Overloads and under-loads detected	Balance resources reflecting new strategy
New area of work not currently owned	Give ownership to an existing team or create a new one

• Many leaders fail to to accelerate in a chosen direction by reallocating resources by inaction
• Once you’ve decided on strategy, look for ways to accelerate it
• Consider:
• Minor team changes
• Re-focus teams
• Reassign teams (put parts of the product into maintenance mode)
• Consider restructuring → but this needs to be carefully considered, communicated and executed.
• Long lasting teams are a pillar of product culture
• Making consistent changes will have a negative impact

Communication and Feedback

• Share your roadmap broadly across the organisation
• Primary communication goals: alignment and shared understanding
• Roadmap sessions have 3 focus areas:
1. What are you trying to solve?
• Strategy gave you: Where you are going and What the opportunities needed to get there
• Now you have a visualisation of that path.
• The roadmap should make your problems to solve visible to everyone
2. Why have you chosen this order for the opportunities?
• Explain your logic for prioritisation
• Share your analysis and assumptions to create a shared understanding
3. Why are you following this time frame?
• Share why some items would take longer than others to tackle
• Wrestle with uncertainty of not knowing the solution yet
• Commit to make an impact and key result … rather than a feature delivery date.
• Adapt the detail of your presentation to the audience.
• You should only have one roadmap → but be able to present it at varying levels of depth
• Get high-level agreement before any broad meeting
• co-create the roadmap in the first place
• then line up the most influential stakeholders before broader meetings
• discuss hard topics in advance - no negative surprises in the meeting
• raise complex issues and tradeoffs and show your work and why you made the decision you did
• adapting your proposal to cover off feedback increases the change you’ll get key c-level buy-in
• Handlong stakeholder feedback:
• Strategy communication is easier than roadmap communication
• Expect stronger feedback on roadmaps
• You’ll miss come expectations…
• Why isn’t x on the roadmap?
• Go back to the data
• Ask what other things should be removed
• Agree to test (gather more information or run some experiments
• Be open to changes → go to sessions with an open mind and adapt to maximise impact
• Uncertainty feedback: Are you going to build feature x or not?
• If you’ve done discovery you’ll have high confidence
• If it’s a new opportunity you can commit to experimenting and gathering insight relevant to their proposed solution
• Include a ‘possible solutions field’ to make it clear you’re going to test or look into a certain approach
• Time Uncertainty: When is x going to be built?
• Explain you don’t know the solution yet, or the time it will take iterating to achieve the metric.
• Shift the stakeholder from plan to strategy mindset
• Shift focus to priorities and sequence of problems
• Put a target quarter on near term items for when you’ll see the desired outcome
• Tag fixed date items (missing the date misses the opportunity)
• Alignment
• Let other teams know what you need form them
• Let other teams know what they can do to help with the strategy
• Think marketing, operations, legal and finance
• Sequence strategy comms before roadmap comms as strategy feeds the roadmap decisions and you’ll have no space to adapt.t \
• Communicating roadmap changes:
• Roadmaps should be live
• Update when you learn more
• Add details as you progress
• Changing strategy → communicate immediately
• Unmet goals → consider extending them, if they were the most important thing to work on … unless that’s changed it’s likely the best thing to do is to continue
• communicate quarterly if the goal hasn’t been reached

Section 3: Objectives and Key Results (OKRs)

Introduction to OKRs

• Objectives and Key Results (OKRs) is a goal-setting framework
• Born at Intel adopted by Google and others
• OKRs combine aspirations and associated metrics
• I will (objective) as measured by (set of Key Results)
• It seems simple, but it takes a few quarterly reps for teams to get the hang of it
• Objectives: are an aspirational goal to achieve → they set a clear direction and can help motivate teams
• Key results: Are both a metric and a target value. They help teams know if they’re going in the right direction.
• KRs are precise, measurable and verifiable
• Time limit: goal systems, like KRs should be achieved by a specific point in time. Usually quarterly or yearly.
• You can have a couple of different KRs for each objective if you wish.
• Basic steps: set → check-in → final evaluation
• OKRs support your product direction and help create autonomous, independent and orientated product teams. They have great attributes:
• Outcome based → focused on value delivered to the user not the activity of the team. The format supports team autonomy.
• Challenging → set goals which are a stretch. A good score is 70% not 100%.

Set goals we know we can’t reach yet because we know that by stretching to meet them we can get further than we expected. Google Principle

• Transparent → everyone sees everyone else’s objectives
• “OKRs provide the necessary context for anyone from any department to understand what a team or individual is trying to achieve”
• Aligned → check teams are aligned to company goals
• Cascading objectives can feel imposed and like a waterfall process
• OKRs a supposed to be a mix of bottom-up and top-down.
• Company goals set the direction, teams can create targets based on how they can contribute to each desired result
• Agile → create room for change and set quarterly
• Create focus → by having only a small number
• teams that pursue less can have bigger impacts on the ones that matter
• keep the number of objectives as low as possible (1 is great, don’t go beyond 3)
• If you have 3 objectives and 3 key results you have just 1 week per key result.

• In some circumstances it’s hard to be outcome bases, be practical and allow exceptions but don’t fall into the trap of making
• Legal or compliance requirements
• Refactors or internal capabilities
• Internal proxies vs real outcomes
• Partial work

The Process of Managing OKRs

• Phases: Creation + Check-ins + Final Evaluation
• Creation Phase: Four steps over a few weeks.
• Area and teams drafts
• Dependencies and feedback loops
• Final values and quality review
• Inputs to OKRs: Strategic Roadmap + Current Team Structure
• People involved: let teams own the goals specification. Senior managers can help with alignment and measurement quality → they don’t decide what metric or target value teams use
• If you think you need to control the goals → you need to provide more strategic context to the team
• Your strategy and communication weren’t clear
• PdMs should own the OKRs
• The TL and Design Lead should be critical decision makers during the definition process
• Discipline managers can review alignment and broker dependencies and quality of defined results
• Appropriate stakeholders especially if they have related KRs
• Do you need product-area OKRs? They can create confusion and duplication. You don’t want to force together unrelated work and key results. BUT there are some benefits too…
• Help measure cross-product results
• Teams can see what they’re contributing to
• Help Product Leadership simplify conversations with management
• Product-Area OKRs can help provide teams with clear strategic directions
• Cadence → Use Quarters
• Match check-in frequency to the speed at which teams can impact results (from 1 week to 6 weeks)
• Process Flow:
• Area Draft → team draft → dependencies management → final version → regular checkins
• Week 0: Ready to go
• Week -1: Final targets and critique
• Week -2: Dependencies and conflict resolution
• Week 03: Area draft / teams draft

Defining Area and Teams OKRs Drafts

• Create an initial draft of your goals
• Use your strategic drivers or roadmap themes as objectives
• Your opportunity solution tree can help
• A Key Result definition is usually more detailed than a roadmap item
• A single roadmap item might have many KRs
• You can group KRs into objectives that are aligned to your team structure
• It’s more important to align OKRs to teams than it is roadmap items
• Tools to select more specific metrics:
• Metrics Frameworks:
• AARRR → useful for SaaS products
• Conversion funnel → e-commerce
• Google’s HEART → most products, focus on UX
• 3 games of customer engagement → identify metrics based on what’s more important (attention, purchase or productivity
• KPI trees help visualise and explore what sub-metrics will impact your desired outcome
• Make sure you’re using the KR that is most specific to the problem you’re trying to solve
• A KPI tree can find you a metric in two ways…
• Starting at the top, and breaking down a KPI into component parts
• Or detecting an opportunity that impacts a lower level metric that could drive a higher level result
• Leading indicators:
• Find metrics that if affected today can impact desired outcomes
• E.g. Customer Lifetime Value is a lagging indicator
• E.g. Increase task completion is a leading indicator
• They’re easier to measure from one iteration to the next, create faster loops, so teams learn if they’re impacting their KR or not faster
• Selecting a leading indicator is making an assumption that it will change the desired outcome
• Segment
• Segments can help create better KRs
• There are countless ways to segment
• Demographic, psychographic, behavioural, firmographic (for B2B)
• OKR linking is a powerful alignment tool
• Declare which higher level objective your OKR is contributing
• You can link to product department OKRs or business unit objectives
• Challenges of linking and aligning:
• Indirect relationships → may not be directly attributable.
• Lack of a related company goal → E.g. maintenance OKRs. Should be rare, if not you don’t have strategic alignment
• Link to multiple business units → could link to a shared service area
• The goal is to identify OKRs which are aligned, but not matched 1-1. Work hard to align, but be practical when exceptions are needed

Dependencies and Feedback

• A cross-team revision checks objectives are logical and consistent in the entire organisation
• Checking dependencies, reviewing high expectations and adjusting drafts
• Can take a week to resolve if number of teams and underlying technical architecture are against you
• Some OKRs drive requests to other teams because they depend on them to achieve their results
• This is a side-to-side dynamic (not just top-down or bottom-up)
• Breaks down silos and enables peers to work together to define the best way to achieve strategic objectives
• Some teams will have too many objectives if they chose to help all dependents
• They can ask for requests to be dropped or delayed
• Goal dependencies drive teams to discuss the organisations most critical outcome
• Ask the team to meet with all dependent teams → and get them to make the decision together
• if you’ve provided enough strategic context this can empower teams to sort things out
• Work to lower dependencies by design.

building anything at all simply required too much effort from too many teams. We had two choices: 1. Increase the coordination and control of which initiatives to work on 2. Invest in making teams more independent Attempts at managing complex dependencies such as the Scaled Agile Framework Enterprise (SAFe) end up obstructing the intention to create autonomous and empowered teams. Most successful product organizations opt for finding ways to reduce the amount of coordination required, investing in architectures and practices that provide teams autonomy.

1. Tools: modular architecture, DevOps, internal open source
2. Measure how many of your portfolio initiatives have dependencies

Final Values and Quarterly Review

• Get teams to self assess the quality of their OKRs

• Heads of disciplines should provide a second review and help teams increase their OKR quality.

OKR Check-ins, Updates and Communication

• Build regular checkpoints and facilitate an analysis of the situation
• Each team updates their goals, values and status based on the defined KR
• Include any insight or prediction about how you expect the value to change
• Cross-team reviews → synchronise everyone quickly around overall results of all product teams
• Everyone should be pulling toward the same strategy → so everyone should care about the success, failures and learnings from other teams
• Include: status (doing well or not) , results highlights (KR metric movements), learnings (about the hypothesis)
• Official updates serve as a trigger to change plans and elevate awareness of off-track goals
• OKR review results can lead to…
• No new action (goals are on course)
• Normal plan modification (changing plans and tactics but targets remain the same)
• Eliminate, change or add objectives (given current results or an extraordinary situation)
• → in this instance changing is better than persevering with an impossible goal
• There should be NO process to change the OKRs… teams should just be empowered to change them and keep everyone aligned (especially dependent teams)

• How final check-ins can influence the next quarter
• Baselines might change for future KRs
• Future work may require achieving previous goals
• Past results could invalidate our current definitions

Conclusion

• Product direction selects the problems and goals on which we want to focus discovery and delivery
• Simple model:
• Direction: choose the right space
• Discovery: validate the right solution
• Delivery: achieve the right results
• Author sees the product direction coming ahead of the design double diamond

Diamond	Diverge	Converge	Exit with
Direction	Insights	Strategic selection	Problems and goals
Define Problem	Discover	Define	Definition & hypothesis
Define Solution	Ideate	Validate	Validated solution`