296: How to Do Product Prioritization
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In today’s episode of The Startup Chat, Steli and Hiten talk about Product Prioritization. They highlight how to prioritize what is important for your business and how to get the team on board, working towards the important objectives.
Product prioritization is an important metric in the success of your company. You must know what is important for your customer and how your product will deliver that to them. An important part of this, is ensuring the team are engaged in solving the problems and achieving the goals of the company, which allows the product to be optimized effectively.
Tune into this week’s episode of The Startup Chat to learn about product development and product prioritization. Hiten, shares his expertise on some fatal mistakes of product development and how to fix those problems. Steli and Hiten also discuss how to empower your team to get involved in all parts of the business.
Time Stamped Show Notes:
01:01 Product development questions.
02:20 The number one challenge in product development.
03:41 It’s important to do your research.
04:39 Figure out what the problem in your business is.
04:50 An example of problem solving in business.
05:52 Changing the way you do business to solve your problems.
06:46 Why is product development so difficult.
07:43 Working together toward the main priorities.
08:43 Why removing silos from your company is good for business.
11:01 For more information on Product Development visit Product Habits
3 Key Points:
- If you can’t figure out your number one problem, you have no business at all.
- We are used to our own constructs.
- All teams should work based on the number one priority of the business.
- Recommended – https://producthabits.com
Steli Efti: Hey everybody, this is Steli Efti.
Hiten Shah: And this is Hiten Shah.
Steli Efti: Today on the Startup Chat, I forced my man, Hiten Shah, to talk about product prioritization. He’s been teaching all of you people how to build better products on producthabits.com. For those of you that are not on the email list yet, pause the podcast right now. Type in the URL on your phone, put in your email address, it’s the most valuable email you’ll get to learn how to build better products. So, Hiten you published a bunch of stuff on how to do prioritization of products, that’s probably why Hiten, why I had to strong arm him to do this episode but I know that some people still need to hear it from you in a different format, so let’s quickly bang out an episode on this. People have a product, and MVP, some kind of a version. There is a huge list of ideas they have, of things they want to build. There’s a huge list of things that customers tell them to do. There is the potential to look at should we be improving our current features that are not quite perfect? Or should we be building more new features? Should we be building new features until they’re perfect and really well polished before we release them, or should we just be like launching new features really quickly even if they’re not great? Do we let others tell us what to do? Should we do it internally? What kind of process do we do? Do we vote up features or not? I do think this is a super complicated problem for most teams, deciding how to prioritize, what to build and how to build that. What is your basic framework? What have you learned through all your research? How should companies and teams think about this?
Hiten Shah: Last year I asked the audience of my email list, right when we were changing the name of it to Product Habit, because it used to be my personal email list and I wanted to do more and help more people, and be very focused. I wanted to do it about product, I really love product and all that kind of stuff. I asked people what their number one challenge with product development is, and everyone, doesn’t matter what size the company, what department in terms of like … Not what department, what category they were in, even sales people, marketing people, everybody chimed in and they said the number one challenge with product development that they see, obviously product people chimed in too mostly, was product prioritization, and figuring out what to build and when to build it. So, I’ve created a whole bunch of emails on that. I actually have some form of a stage of development of a course workshop and have been doing a lot of testing on that product itself, as well as continue to ask people things and learn myself how to do this better, because I resonate with the problem. I think we all do. What do I build next? And how do I know that it’s the right thing? Again, doesn’t matter, I’ve seen Fortune 500 companies respond and tell me they have problems with this. I’ve seen the smallest startup with two founders respond and say, “We don’t know what to build next.” It’s a problem. It’s a problem that’s only getting worse too because there’s more competition and there’s customers that are out there that are fickle, you know? They’ll try another solution on a whim, no matter how invested they are in yours, especially because it has this one feature that you don’t have. This is it, and the dream would be like every single thing you build is built because you know it’s the right thing to build and you also have a very good idea of the impact it’s going to have on your business. So, let’s work backwards from there. The big thing I learned is that people just aren’t doing enough homework, and I don’t mean like just one type of thing like customer development or customer research or user research, whatever the hottest trend is on learning about your customers. I’m talking about everything. I’m talking about looking at your existing customer base. Realizing why they love your product. Looking at them and being like, well what do you want, right? And then looking at everyone who’s signing up today and figuring out what do they want? Mapping those things together, also spending the time to figure out with your own business metrics, the boring stuff, your churn, your new customer growth, your sign ups, your retention. What is the number one problem in your business? Because, honestly if you can’t figure out the number one problem in your business, you have no business at all. You won’t be able to grow it. You won’t be able to figure out what to prioritize. The first lesson that I would give, and the main one, probably the only is go figure out what the problem in your business is. It’s not about your competition or anything like that necessarily. It’s all about, like, what’s the thing that’s hurting you the most right now? I can give an example in your case, Steli. I think in your case, based on talking to you, knowing enough about your business today, right now your biggest push is getting more sign ups. Is that correct?
Steli Efti: That’s correct.
Hiten Shah: Right, so we’ve talked about this. You’re looking for marketing help and all that kind of stuff and hiring and all that. So, there’s no surprise here. What if, and this is where it gets super interesting, what if your product initiative for prioritized even on product, in areas where you might not see the relation, but even on product were prioritized around helping you get more new sign ups?
Steli Efti: I love it, yeah.
Hiten Shah: That’s what I mean.
Steli Efti: Yeah.
Hiten Shah: Right? That’s the conversation companies don’t have. They’re like, oh, I do product. I work on product. I have nothing to do with getting new sign ups. Wait, bullshit. If that’s the number one thing that’s important in your business, why wouldn’t you have a majority of the product team or all of the product team worried about that?
Steli Efti: Yeah, I think-
Hiten Shah: What would happen?
Steli Efti: Yeah. Well, you all of a sudden have engineering resources to do things that will drive sign ups, which is something that-
Hiten Shah: You got it.
Steli Efti: That you wouldn’t because you think of the engineering team as something that only impacts product features, right?
Hiten Shah: Got it.
Steli Efti: Love it.
Hiten Shah: That’s it. That’s it right there, dude. That’s it, like what would you do? And here’s the fucked up thing, if that’s the number one problem you have, why isn’t the whole company like, oh crap. We need to work on that or we are fucked, right? That’s what doesn’t happen. This blows my mind, Steli, like it’s so logical. It’s the hardest thing to do though, I’m not saying this is easy. This is why I’m, like, on it. Oh crap, this is a problem, people don’t realize how much of a problem this is.
Steli Efti: But why is it … So, you said it’s so important, it’s simple, blows your mind that it’s so difficult. Why is it so difficult? What do you think?
Hiten Shah: We are used to our constructs. What you just said. Oh, now I’ll have engineering to help with that. But engineering and product don’t think about it like that yet. I’ll give you the easy one, dude. You guys, I don’t know if you have a referral program. I haven’t looked at your product in a while, right? Dude, product needs to build a referral program. Oh, sales, they can’t help with new acquisition. Wait, they know the customer, customer success, they know the customer. Why aren’t those two paired up in getting you referrals, more of them for new customers? Why isn’t product helping with that? That’s just one idea, but it’s the most obvious one when you think, wait, I can have engineering at this? Yeah, dude, create a referral program. Test the crap out of it, right? Done. You want more sign ups Steli? Don’t you have happy customers?
Steli Efti: Well, the beauty of this is that instead of thinking of different teams within the company in a very, kind of, constrained box, what you’re saying is the entire company has main priorities and anybody in the company, any team in the company, could help with that main priority. Doesn’t matter in which team you are. So, from a product perspective, to bring you back to that team, the product team should work and prioritize based on what the number one priority of the business is. Right, and if that is retention, that shapes that product roadmap differently than if it is acquisition.
Hiten Shah: Right, you got it. There’s so much more to this in terms of frameworks and structure, but, like, what we just talked about right now, it’s the simplest thing. That’s it. That’s all of it in a nutshell. That’s why I say it’s absurdly simple. The hardest part is systemizing this, and turning it into a process that you’re able to repeatedly do. Because after acquisition Steli, you’re going to have some other problem. My assumption is, like, retention.
Steli Efti: So, let’s briefly touch on this before we wrap up the episode. This brings up a good point. I’ve read before companies like Intercom, they had some kind of a product framework that was saying our number one focus is getting … Or when it comes to product it’s always getting adoption up for a feature, a new feature.
Hiten Shah: Yup.
Steli Efti: Then the second priority is to get, you know, frequency of usage per feature up.
Hiten Shah: Yup.
Steli Efti: Then the third priority is to launch new features, right? That’s kind of their three step process.
Hiten Shah: They’re bullshit. Wait, hold on. They’re bullshit, because they’re treating product as a silo. That’s bullshit. Like, I’ll call them out. Fuck that. They’re talking about a siloed way to think about product teams.
Steli Efti: Yup.
Hiten Shah: So, then you’re going to create more silos, so I’m not saying they’re wrong. They’re not wrong. If you treat it like a silo, great, but I’m calling it for bullshit because if your business has a problem that has nothing to do with those things going up, then the product team will be working on things that don’t impact your business. So, they’re right if those things impact your business, for sure. But I’m just going to call bullshit on the fact that that’s all product teams do, because that’s the way they like to preach it too. That’s the way most people would say it. That’s the old way. Are we a whole team as a company or are we a bunch of siloed people working in our own areas? What are we? That would be my challenge to any company who’s thinking of it in that much of a, you know, siloed construct. Because, what ends up happening then is you have so much waste in a company if your product team is working on adoption and feature and things like that, when you actually have a fundamental acquisition problem. What I would rather have the product team work on is a referral program that is deeply rooted, baked into the product and get adoption for that. That’s what I’m saying. They’re bullshit. It only matters if before you worry about adoption and all that stuff, that the product team is working on the correct initiative. This is what nobody talks about. This is why I think it’s so hard. We’re stuck on this construct. You just proved my point, right? Even like a company that, I honestly, I respect them a lot. They’ve built an amazing product, but nobody should get confused, because even them, they know how to prioritize.
Steli Efti: Boom. Hiten Shah dropping fire people. All right, so for those of you that listened to this and are thinking, oh shit, all right this makes so much sense. We’re going to put this in practice, but how do we put this in a process, all that, how do I learn more about it? Producthabits.com or is there another place? Let’s point people to another place if they need more.
Hiten Shah: It’s producthabits.com, there’s actually an e-book about five habits for better product and product prioritization that you can check out that I know people love, even though I haven’t made it better in a while because people say they keep loving it, although I should probably make it better. Also, if you really are into this, like just hit me up at Hiten@producthabits.com and I’ll help you out.
Steli Efti: Boom, boom.
Hiten Shah: Steli, thank you. Thank you for bringing out my passion on this topic, because we don’t talk about it a lot on here but it’s something, as all of you can hear, I give a big fuck about.
Steli Efti: You give both a big fuck about and you know what the fuck you’re talking about, which is dope. All right, so I love this-
Hiten Shah: I appreciate that, thank you.
Steli Efti: I’m so glad, I’m so glad I’ve been following up on this topic for a number of weeks now and finally got you to crack. Dope, thank you so much for bringing the fire. Everybody, you know what to do next. This is it from us for this episode.
Hiten Shah: Later.