Elements of a Good Product Strategy
I had planned to organize a product strategy workshop this month, but due to life commitments, I'll likely postpone it to Q1 2025.
Still, I wanted to write this post as a guide for product managers currently planning their year ahead.
From my experience working with product teams, I've seen many companies make the same mistakes with their strategy. They get excited about new ideas and cool features, and they feel pressured to release products quickly. But without a clear strategy to guide them, their efforts lose direction - like a boat drifting at sea without anyone steering it.
A good product strategy is more than just fancy documents and trendy business words. It should be a living, breathing guide that shapes how we develop products.
At its core, it's about three main things:
Making clear decisions about what to do (and what not to do)
Being strict about what's most important
Getting everyone in the company to work toward the same goals.
However, before we talk about the elements of a good product strategy, it is important we discuss strategic context first.
Imagine a football team charging onto the field without a game plan. Chaos would ensue, players would run in different directions, and the chances of scoring a goal would be abysmal. The same principle applies to product development. Without a clear strategic context, teams become disjointed, decisions become reactive, and the product's full potential remains untapped.
Strategic context is the foundation upon which a good product strategy is built. It provides the guiding principles, the vision, and the shared understanding that empowers teams to make effective decisions, prioritize ruthlessly, and deliver impactful results.
Here's what a strong strategic context encompasses:
Business Mission and Objectives
Start by understanding what your company wants to achieve. It's like checking a map before starting a trip - you need to know where you're going. Your company might want to be the best in its field, make customers happy, or create new and exciting products. As a product manager, you must understand these big goals. If you don't know what your company is trying to achieve, you can't make a good product plan. So before thinking about product strategy, make sure you clearly understand your company's main goals.
Product Vision
A product vision is a simple statement that explains what you want your product to become in the next 5 years. Think of it as a picture of your product's future that everyone can understand. It helps your team make better decisions about the product and gets them excited about working towards a common goal. When you have a clear product vision, it's easier to attract great people who want to help make it happen. At its heart, a product vision explains why your product exists and how it's going to help make people's lives better.
Team Topology
Team Topology is like a map that shows how product teams work together. It spells out who does what and which parts of the product each team owns. This setup lets teams work independently while still following the company's main product goals. When teams know their roles and how they fit together, they can work faster, collaborate better, and feel more connected to the product's success.
Product Strategy
This is a plan that shows how to reach your product goals and business targets. It's about making smart choices about where to focus your efforts and money. You'll need to spot the best opportunities, handle any risks, and decide what's most important to work on. The main goal is to make your product as valuable as possible and make sure you're spending your technology budget wisely.
Team Objectives
These are specific goals we set for our teams, usually as OKRs (Objectives and Key Results). They turn our big-picture strategy into clear, doable tasks. This helps teams focus on fixing the most important problems and getting real results. Having clear objectives also makes it easier to track progress, hold teams accountable, and keep getting better over time.
So, what are the core elements that constitute a truly effective product strategy? Let's dive in.
Focus
Focus is like having a special power - it helps you choose what's truly important when there are lots of ideas and opportunities around you. It means being able to say "no" to things that might distract you, and instead putting your time and energy into what really matters.
When you're creating a product strategy, you need to be very clear about what you want to achieve. This means picking the biggest problems to fix, the most useful features to build, and the best markets to target. Sometimes you'll need to turn down good ideas if they don't fit with your main goals.
To stay focused, you need three things: self-control, bravery, and a good understanding of what your users want. Instead of trying to make everyone happy, focus on doing the things that will help your users and your business the most.
Insights
Don't build your product strategy on guesses - it won't last long when real market challenges come up. Instead, base your strategy on solid insights about your customers, competitors, and industry.
These valuable insights can come from many places: talking to users, studying the market, watching competitors, looking at data, and using your own experience. When you combine all these insights, you can make better decisions and find new opportunities to help your customers.
Transparency
Don't keep your product strategy hidden away. Instead, share it openly with your team, stakeholders, and where appropriate, your users. When you're open about your plans, people trust you more and feel more connected to the work.
Good things happen when everyone knows why you're making certain choices and what you're trying to achieve. People care more about making the product successful, and they feel more confident about sharing their ideas. This creates a workplace where everyone can do their best work..
Placing Bets
We make smart guesses based on what we know. We try different things and learn from what works and what doesn't. After all, if we already knew which features customers would love or which markets would be successful, we wouldn't need to create strategies at all.
That's why a good product strategy accepts that we can't know everything for sure. It's okay to take careful risks and try new things. The key is to keep testing our ideas, listen to feedback, and make improvements based on what we learn from real data.
The Importance of Deep Thinking
When building a product strategy, it's easy to want to rush into writing everything down right away. But here's the thing - just writing isn't the same as thinking deeply about your strategy. To create a strategy that really works, you need to take time to think carefully, do your research, and analyze your options. This means asking tough questions, looking at things from different angles, and questioning what you think you know.
Yes, this kind of deep thinking can feel messy and take more time than you'd like. But it's worth the effort. When you put in this work upfront, you'll end up with a clear product strategy that helps your team stay focused and move in the right direction. Most importantly, you'll be more likely to build something that your users actually want and that helps your business succeed.
These elements are a great starting point, but remember, nailing your product strategy is the key to building truly successful products. It's tough, but it's the most important thing to get right. Use these elements as your guide, and you'll be well on your way to creating products that users love.
Got questions? Just send me an email - I would love to help you with your product strategy!