The Best Inc. vs The Rest Inc.
Piotr Kaca?a ??
CTO / Board / Advisor ? I help companies building great product engineering teams
I think we have a big problem.
90% of companies are unhappy about teams building their product.
The most common problems with product teams you’ll hear about:
Companies are right to be worried. They know that?if they don’t fix those problems in time, their competitors will start taking their customers. It may take two, five, or more years, but it will happen.
They’re trying things to help the situation - hiring consultants and running big transformations, but things aren’t improving. Bad news bears. ??
They are also right to be desperate to fix those problems. Because they know that if they create the right environment for their product teams, it will significantly increase the company’s chance for success and bring profit in the long term.
Let’s zoom in. After reading this post, you’ll understand:
Grab your coffee, and let’s change the world together. ?
What are product teams?
I will refer to the?product team?as a team in a company that builds the product.
These teams typically include:
In some companies, these people are formally in one team; in some, they're in different teams but collaborate?occasionally.
Some companies call these teams differently:?feature teams, dev teams, scrum teams, or IT teams. Funnily enough, these names often pair with companies being unhappy about their product teams.
There is something more than just what label you put on the team. It's how you design the environment for product teams to work.
After reading this post, you should understand which tech teams are truly empowered?product teams,?which teams are not, and what to expect from both.
Let's look at what life looks like for the same product team in two different companies. These are actual companies, but I’ve changed their names to?The Rest Inc.?and?The Best Inc.?to keep them anonymous.?I picked them precisely because they are all-rounded examples of how two groups of companies work - the best and the rest.
The Rest Inc.
First, let’s look at how life looks for a product team in?The Rest Inc.
Team
The Rest Inc.?has hired three engineers, one designer, and one product owner. They’re not rockstars, but they are more than competent and friendly. Good people that you would like to have on your team. Engineers code, designer designs, and product owner handles backlog in Jira.Work
The company asked them to release things from the roadmap and take care of their website and mobile app.
They work in Scrum. Lately, they’ve rebranded themselves to?squad?in the hopes of copying the success of Spotify.
There are many?meetings?they need to attend and?processes?they need to follow. They?work on features?listed on the?roadmap. Business stakeholders meet monthly to check the roadmap and discuss planned features.
The?product owner?gathers requirements?on these features, puts them into Jira, then?passes?them to the designer. The designer designs it, then?hands it?to engineers to estimate and code it. There is a bit of?communication ping-pong?between them, but they all agree this is not ideal - the?“We must work on the communication”?note consistently gets the most votes on the retrospectives.
The?deadline?for the release they’re working on is getting closer, but the feature is not ready. It turned out to be more complex than estimated. The team?cuts the scope and quality?and tries to?release on time. Once they finish the feature, they move to the next roadmap item.
Results
Most of the features they deliver?don’t bring significant product results?(conversion, retention) if only these are measured.
Business stakeholders are?unhappy:
People on the team are?unhappy:
The effect is that the?product is not improving, everyone is?unhappy, and?people are leaving?the company.
The only people who can be happy in the scenario are their competitors. They know they have a chance to take?The Rest Inc.?customers if they don’t fix the problem in time.
Big picture
The Rest Inc.?is an example of what 90% of product companies look like.
Which means...
90% of all?product?companies cannot consistently innovate and deliver customer value.
Houston, we got a problem.
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The Best Inc.
Now let’s look at the other side of the mirror.
Imagine the?same group of people?in the team working in the other company -?The Best Inc.?As a reminder, there were three engineers and one designer. This time we'll switch the product owner with product manager*.
* I have no beef with Agile or Scrum, but there is a big difference between Scrum Product Owner’s and Product Manager’s responsibilities. In short - Good Product Managers act as mini CEOs and have?way more?responsibilities than delivering features. Product Owners often are tasked to administer the product backlog and coordinate the delivery.
I may write on it someday—subscribe to get notified.
Work
The team has worked together as a?product trio?for quite some time?to?discover?and?deliver?valuable?solutions for their customers. They make sure these solutions are in line with?their business.
The team is?empowered?to decide what they build, but that doesn’t mean they do things randomly - they’re aligned with the rest of the company. Everyone in the company understands their?vision?- where they want to be in a few years. And everyone follows the?strategy?- the order of choices they made that should take them to the company vision.
Our product team has a?specific objective?connected to the?strategy.?Company asked them to try to increase the number of people adding something to their website cart. And they are?accountable?for the results of that objective.
They look at the?data, do a lot of?research,?and?interview?customers?to understand why some people don’t add things to their carts. Every week they get a better grasp on the situation.
They validate their theories by?prototyping?solutions and running many?A/B tests. They?constantly?add?small changes?to their product that positively impact their?objective KPI?- add-to-cart conversion rate.
Everyone is happy—customers, team, and company.
Big picture
The Best Inc.?is an example of how only a?few percent?of product companies work.
Which means...
Only a?few percent?of all product companies can?consistently?innovate and deliver meaningful customer value.
The Rest vs. The Best
As you can see, the same group of people could bring incredibly different results, depending on their work environment.
Differences between?The Rest Inc.?vs.?The Best Inc.?include:
These are the true differences between empowered?product teams?(The Best Inc.)?and features/scrum teams?(The Rest Inc.).
Which company are you?
Time for some honesty. Are you working like?The Rest Inc.?or?The Best Inc.?
If you're closer to?The Best Inc.?- that's awesome! The world needs more companies like you. Stick around, spread the word, and hopefully, you'll still find something valuable.
If you're closer to?The Rest Inc.?- don't worry. Most companies work like that and don't know how to change it. There is also good news if you want to work more like?The Best Inc.
The good news is:
Product Blocks
Remember the days when you were a child and you were building things with plastic blocks?
You used different blocks with different shapes and colors to make various creations like buildings, vehicles, and animals. The same set of plastic blocks let you build different things. The only thing that was stopping you was your imagination.
Building things with plastic blocks is not far from building teams and companies. Think of the ways of working of each team and company as a set of plastic blocks. Each plastic block represents a specific technique, framework, and principles used.
While each company is different, the building blocks used by the best product companies (think?Apple, Google, Amazon, Spotify, Netflix, and many more) are?shockingly similar. This is where I write about the blocks they use - their techniques, practices, frameworks, principles, and views. No fancy talk, just?step-by-step instructions on how to apply those yourself.
?? Super specific how (SSH)
Here is your todo list for?today:
3. Check all?100+ best practices?used by?the best companies:
4. Read some brilliant people who write on the subject of empowered teams:
Good luck, have fun, and see you in a bit!
Piotr ??
Chief Digital Officer. I work with People and harness Digital, Data & AI to enable a step change in results
1 年One of the best posts I’ve read in a long time. Truly on the money (or Product :-)) Piotr