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Wednesday, December 10, 2014

Does your organization really know what it's taking to market?

Having been exposed to a fairly large number of product organizations, I continue to be surprised at how rarely they explicitly define a set of concepts representing what it is they take to market. Terms like "product" and "solution" are bandied about but often it seems no one can point to a common definition, resulting in multiple people and organizations having their own definitions and associated expectations regarding these concepts. Having clear, consistent definitions for the things we take to market help keep the entire organization, from executive leadership to developers, on the same page and can have important implications for assigning accountabilities. In this post, I'd like to offer a set of simple concepts that have served me well. If used consistently, these definitions can alleviate some of the confusion I've seen time and time again in product organizations all over the planet.
  • An offering is an umbrella concept representing anything that your organization takes to market for customers to consume. The rest of the concepts in this list are types of offerings.
  • A product is a good, virtual or otherwise, that is developed and delivered to multiple customers in essentially the same form. Managing products throughout their life cycle presents challenges that I believe are an order of magnitude greater than managing deliverables from a customer-specific project. Transitioning from single-customer project deliverables to product delivery is a topic I've addressed previously in this blog.
  • A service, in the context of offerings, is work performed by people for customers, whether it involves "knowledge work" or physical labor. Services are an under-served offering in many organizations, representing a way to add incremental customer value while strengthening customer relationships.
  • A solution bundles products and services (and other solutions!) to solve customer problems. Solutions are very often customized heavily for individual customers. Market solutions are defined a priori and promoted in the market. Customer solutions are an instance of a solution delivered to a specific customer.
Based on these definitions, I've found that many product managers, especially those in the B2B space, are actually managing solutions. Acknowledging this fact can help everyone in the organization appreciate the scope and complexity of the work the product management organization is doing. 

I'm not sure that it's critical for every organization to adopt the exact same set of concepts or terminology, but it would be nice! I think it's more important that all product development disciplines (PM, marketing, sales) and executive leadership be on the same page. Ideally, this same or very similar terminology is used to describe offerings to customers and prospects.

What do you think of these definitions? Are they similar to the ones your organization uses? Does your organization have an explicit set of shared definitions?

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  1. I think those definitions are good. Though, I would argue that a service is a product. Specially if we could agree with the simplest definition of a product, which is: anything created to solve somebody's real problem.

    From personal experience I know that most product managers would love to work on a solution level (as a minimum). Unfortunately from time to time PMs are forced to work on a feature level. In theory features you serve to a market should contribute to a solution, but in practice it's often not the case.
    Moreover, serving features are not in-line with a good practice of releasing to market only something that could make an impact.

    This only highlights the importance of being problem driven and apply outside-in approach.

  2. Hi Daniil,
    Thanks for the feedback. I avoid this generalized concept of a product. My definition differentiates something you develop and sell from services performed by people. Perhaps more importantly, it differentiates this offering from goods that are developed for an individual customer (like on a customer project). Once you have to ship to multiple people and manage something, eg. software, throughout it's life cycle, the problem becomes much more complex and requires someone to manage it, ie, a product manager!

  3. I agree, Greg. I would add the complexity of differentiating a service (other goods and results than a physical product in its traditional conceptualization) in its main form (the result) and its collateral attributions (helpdesk, postsales, etc.). So, there is the main result (service) when it's not [partially or completely] physical (product) and there are multiple post-result services (attention, guarantee, training, helpdesk, maintenace, etc.). The presales (consultancy, team with the customer, etc.) + the product/service + the postsales could be the solution in my opinion, and solutions are preferred for clients/customers because client/s and provider/s are more based on a business partner relationship and it is endorsed on trust.

    Thank you for sharing your thoughts, Greg. Much appreciated.

  4. Thanks for your input PG! Would be interesting in a future post to further dissect these concepts, e.g., types of services.