thoughts on lean product development at camug, yyc nov 2014

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Lean Product Management

The Value of Experiments !!!@DaveSharrock


compliance international B2B MBA English IPO

agile husband start-up technology

newly-minted Canadian

executive leanstartup outsourcing father enterprise transitions

B2C data analysis kanban seismology PhD

scrum organizational excellence

[email protected] twitter: @davesharrock Certified Scrum Coach (CSC) Certified Scrum Trainer™ (CST)

Dave Sharrock


The Sky is Falling! The Sky is Falling!

Applying the Scientific Method to Software Development

Incorporating Learning into Product Development

A Last Note on Shorter Feedback Loops


“No matter how good the team or how efficient the methodology, if we’re not

solving the right problem, the project fails.” !

Woody Williams


http://www.archives.gov.on.ca/english/on-line-exhibits/d-day/big/big_03_airline_assembly.aspx Archives of Ontario, Reference Code: C 190-5-0-0-21

Assembly Line Manufacturing has a high cost of change


• In software development, (presumed) high cost of change leads to long delivery cycles

• Any and every idea has to be captured in the first version of a requirements specification

• This creates waste - bloated documents, unwanted features and entitlement thinking

Inclusive thinkingFeature usage in

enterprise softwareNeverRarelySometimesOftenAlways

Standish Group - CHAOS Report, 1995, 2002


Cost of Change

Detail of Requirements

Hypothesized Requirements

Capture all possible needs


Software Development has commoditized cost of change

Continuous Delivery

Ruby on Rails

Coffeescript

jquery

Object-oriented languages

DevOps

Automated Tests


Cost of Change


Evolving Requirements


Emerging needs as development

progresses



Usability Testing - c.2000


Usability Testing - today

http://welovelean.wordpress.com/2012/01/29/15-essential-tools-every-lean-startup-cant-li/


• If change is cheap, requirements can change continuously

• We can evolve our thinking as we learn more about the product we are building

• Maximizing Return-on-Investment requires validating new features early, before the total investment cost has been spent

Changing paradigms


Cost of Change


Validated Requirements

Evolving Requirements


Lean Startup experiments

Emerging needs as development

progresses



Designed by KISSmetrics


Theory

Prediction

Experiment

Observe

Use the theory to make a prediction

Design an experiment to

test the predictionRun the

experiment

Modify or change your theory

The Scientific Method


The Theory of General Relativity

Einstein’s Theory of General Relativity

Light bends in a gravitational field

Solar Eclipse of 1919

Observations validated General Relativity

Einstein’s prediction

(1907)

Wait for 1919 solar eclipse to observe

whether or not light bends around the sun

Arthur Eddington observed that Light did bend around the sun

Gradual acceptance of General Relativity over Newtonian Mechanics

http://thethoughtstash.wordpress.com/2011/01/03/how-eddington-demonstrated-that-einstein-was-right/


User Model

Prediction

Experiment

Validate

Use the model to make a prediction

Design an experiment to

test the predictionRun the

experiment

Modify or change your user model

Applied to an Online Experience


Vision Planning

Roadmap Planning

Release Planning

Release PlanningItera3on Planning

Daily Planning

Five Levels of Planning

Annually Define a vision

Bi-‐annuallyRank features in order of delivery

Quarterly Plan stories to be delivered during next release cycle

Bi-‐weeklySprint planning, focussing on delivery of sprint goal

DailyFocus on daily planning of team activities

Vision Planning

Roadmap Planning

5 Levels of Agile Planning: From Enterprise Product Vision to Team Stand-up, Hubert Smits (2006)


Vision Planning

Roadmap Planning

Release Planning


Daily Planning


Long-‐termDefine & refine behavioural models we are testing? Pivots happen here.

Medium-‐termValidate understanding with Lean (or Customer Experience) Canvas

RegularlyMinimum Viable Product. Validate ideas before fully committing investment

Bi-‐weeklyProduct Owners, Delivery Team

DailyProduct Owners, Delivery Team

Vision Planning

Roadmap Planning


Learning


Recognize there are gaps in your vision/business model, and look to fill those gaps in as quickly as possible

Known Unknowns

Map of Africa, 1824http://culturalstudieslectures.blogspot.com/2012/01/

lecture-one-on-question-what-is.html


“In a nutshell, the job of the product organization is to make that vision a reality. So we don't work for a few weeks or even a few months and then just declare it's not happening and we should do a pivot. We will typically work hard for many months on a product vision and not even entertain the possibility of giving up.”

!

Marty Caganhttp://www.infoq.com/news/2013/07/pivoting-product-development


Vision Planning

Roadmap Planning

Release Planning


Daily Planning



Medium-‐termValidate understanding with User Story Mapping and Lean Canvases




Vision Planning

Roadmap Planning


Learning


User Story Mapping is a powerful tool for understanding

your product from the perspective of the user


Validated Learning

• Understand the problem a feature will solve

• Decide how to ask if your customer cares

• Validate before investing complete cost


1. Problem

top 3 problems !!!!

Exis3ng alterna3ves

4. Solu3on top 3 features

8. Key metrics e.g. AARRR

3. Unique value

proposi3on Clear compelling message. Why makes you different?

2. Customer segments

Target customers !!!

Early adopters?

9. Unfair advantage Not easily copied

or bought

5. Channels Path to customers

7. Cost Structure Customer acquisi3on, distribu3on, people,

etc.

6. Revenue streams Revenue model, life 3me value, revenue,

gross margin

Lean Canvas: Ash Maurya

Lean Canvas, from Ash Maurya: Running Lean. Licensed under Crea3ve Commons-‐A\ribu3on-‐Share Alike 3.0

Product Market


Problem Top 3 problems

!!!!

Exis3ng /alterna3ve solu3ons

Customer segments

!Early adopters?

Success metrics

!Leading and lagging

indicators

Possible solu3ons

!Key features & benefits for customers & business

Business readiness What is needed to deploy and support the solu3on?

!(Staff, budget, training,

systems, support, opera3ons dependencies on projects/

vendors)

Channels Path to

customers

Costs People, training, capital, marke3ng, etc. + Objec3ve jus3fica3on

Business value 1. User & business value 2. Cost of Delay (urgency) 3. risk reduc3on/opportunity enablement + Objec3ve jus3fica3on

Lean Experience Canvas

ProductMarket

Cost of delay

time

linear

dela

y co

st

1,2,3,5,8,13,21 1,2,3,5,8,13,21

<Title / headline>


Vision Planning

Roadmap Planning

Release Planning


Daily Planning



Medium-‐termValidate understanding with User Story Mapping and Lean Canvases




Vision Planning

Roadmap Planning


Learning


Zappos famously launched without stock, selling shoes from their local specialist show store


Minimum Viable Product

A Minimum Viable Product may be an entire product or a sub-set of product (such as a feature):

• Product - The canonical MVP strategy for a web application is to create a mock website for the product and purchase online advertising to direct traffic to the site. The mock website may consist of a marketing landing page with a link for more information or purchase. The link is not connected to a purchasing system, instead clicks are recorded and measure customer interest.

• Feature - A link to a new feature in a web application might be shown in a prominent location on the website. The feature is not implemented, rather an apology, mock-up, or marketing page is provided. Clicks of the link are recorded and provide an indication as to the demand for the feature in the customer base.

It is ALWAYS smaller than you think!


• In 2009, Google ran approximately 12,000 experiments, of which about 10% led to business changes

• Linus Pauling famously said, "The best way to have a good idea is to have a lot of ideas."

• Focus on minimizing the incremental cost of testing ideas with your customers/users

How Much Effort on ValidationFeature usage in

enterprise softwareNeverRarelySometimesOftenAlways

Standish Group - CHAOS Report, 1995, 2002


One test is worth a thousand expert

opinions. !

Wernher Von Braun

Interaction Model Backlog ValidationDoing Doing Deployed

For <target group> Who <has a specific need> The <product name> Is A <product category> That <key benefit> Unlike <primary competitors> Our Product <additional advantages>

Pathway #1

Pathway #2

•Visualize your User Interaction Model and adjust it as you learn •Come up with ideas for each pathway •Prioritize experimental testing •Spend time on measurement infrastructure (a test without ability to measure = an unvalidated feature)

Level of Detail / Close to done

•Always revisit validation tests for size •The execution board is equivalent to the team’s task board, but at the Idea Card level

Idea #1.1

ExecutionValidated?

Idea

#1.2

Idea

#1.3

Idea

#2.1

Idea

#2.2

To Do Observation

Idea

#2.3

Idea

#2.4

Idea

#1.4

Idea

#1.6

Idea

#1.5

http://www.agile42.com/en/blog/2013/06/17/product-owner-board/


Economists

In November 2007, economists in the Survey of Professional Forecasters — examining some 45,000 economic-data series — foresaw less than a 1-in-500 chance of an economic meltdown as severe as the one that would begin one month later.


In 1940, the chance of an American being killed by lightning was about 1 in 400,000.

Today, it’s 1 in 11 million.

vs Weatherman

http://www.nytimes.com/2012/09/09/magazine/the-weatherman-is-not-a-

moron.html


Shifting Paradigms

“I know that half of my advertising

budget is wasted, but I’m not sure

which half” Lord Leverhulme

B.G.|A.G.

http://www.marketingprofs.com/charts/2009/3161/more-smbs-use-online-media-than-traditional http://marketing.blogs.ie.edu/archives/2011/01/trends-in-online-advertising-in-2011-in-the-united-states.php

agile42 | We advise, train and coach companies building software www.agile42.com | All rights reserved. Copyright © 2007 - 2009.

Lean Product Management The Value of Experiments !

• Product Management is becoming data-driven • Drive down your incremental cost of validation • Validated requirements trump everything • Feedback without a model means little

Thank you @davesharrock [email protected]

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