“Most of the best insights come from what we call a ‘missing.’ Basically, someone sees something that they feel is missing from the world, and the person is driven to fill that void.” — Play Bigger, p.73
What does it take to bring an idea to life? It’s a question most people have asked and the answer is too often a lot more complicated than it should be—especially within large organizations. As software has increasingly powered more parts of the world, it has disrupted existing markets and created entirely new ones, leading to the kind of exponential growth that most businesses are desperate to capture. But internal politics and processes can cause ideas to slowly whittle away leaving behind only the scraps of their potential. And without great ideas turning into great products, businesses don’t grow. Because growth requires more than just an understanding of your current competition and users, it requires foresight and an understanding of how software can change what your users value and who your competitors are overnight.
Which begs the next question: Are there better approaches for consistently building innovative, revenue-driving software-powered products? The answer: Yes, but it first requires you to identify and fill in the missing.
Many of the most impactful products emerged from filling in the missing. Airbnb evolved from the lack of low-cost travel experiences that made people feel like a local; Uber emerged because finding a cab and sharing the cost was time consuming and frustrating; and Netflix pivoted into its status of the world’s leading streaming service by filling the missing piece between the immediacy of online downloads with the trust of a reputable DVD delivery service.
At Connected, we see the missing in modern product development: In an era of dynamic technological transformation and rising customer expectations, large organizations struggle to make impactful progress and ultimately build better products.
In reality, the missing comes from a lack of empowerment. There are countless individuals inside large organizations who have both the ambition and the creativity to develop software-powered products that are loved by millions of users and drive massive revenue growth for their business; however, the structures in place often block innovative ideas from being properly tested and launched. Great hunches and deep-rooted insights end up tucked away in a presentation deck that gently collects dust in a long-forgotten filing cabinet.
This is because building successful software-powered products is a difficult, novel, and intrinsically complex process—one necessitating a deep integration of design, software development, and product and business strategy.
But companies that have scaled on their past success are often forced to specialize and work in silos. Each department leader finds themselves working toward their own goals and with their own team as opposed to creating impact across the business and delivering it to end users. Often the reality is that big businesses are not structured in a way that optimizes for growth; with the people closest to the users being removed from the critical decision-making processes—because they don’t own the value proposition they are downstream from decisions. Marty Cagan dismisses this way of working in the form of the less desirable “feature teams”:
“… in a feature team, you still (hopefully) have a designer to ensure usability, and you have engineers to ensure feasibility, but, and this is critical to understand: the value and business viability are the responsibility of the stakeholder or executive that requested the feature on the roadmap.”
This approach is in stark contrast to the reality of building great products, which is a process that requires a holistic, empowered and cross-disciplinary team.
To get around the challenges, many businesses have begun creating internal innovation labs; acquiring dev shops, design agencies, and digital strategy firms; inorganically positioning themselves as “more start-up like,” “digital first,” or “product led”; augmenting their DNA overnight through rebranding and hiring in opposition to their current culture; handing innovation over to an external service provider that operates separately from the day-to-day reality of the business; or creating new leadership roles such as Chief Innovation Officer and Entrepreneur in Residence.
Yet, if we accept the premise that impactful product development requires the knowledge, creativity, and energy of every business unit, none of these approaches can offer unilateral success. Truly great products come from specialized knowledge bases working together to create something that is bigger than the sum of the individual parts. As Clay Christensen remarked, solving for innovation “is about putting your arms around the whole problem.”
It is this approach that has built software-powered products like Slack, Nest Learning Thermostat, Peloton Bike, and Google Home. What businesses need is a cohesive glue that not only brings different disciplines together, but sticks them together time and time again, product after product.
The big problem in product development
Our experience has led us to a simple conclusion about the biggest challenge facing great product development: large organizations lack the people, practices, and structure to both build the right software-powered products and build software-powered products right.
Building the Right Product
Building the right software-powered product means discovering an unmet user need and rigorously developing a solution against it. The rigorousness of this process shouldn’t just be upheld in the early research phase before anything is built, it should apply all the way through to release and on every iteration of every single feature of the product. This requires not only product strategists and user researchers, but software engineers and UX/UI designers working collaboratively throughout. Simply put, the ability to build the right software-powered products is not found in isolated departments, phases, or tactics, but is a DNA-level competency that utilizes the brain power and creativity of an entire organization. Therefore, no simple restructure, acquisition, hiring spree, or innovation lab can help build better products overnight.
In cases where large organizations recognize this competency gap and choose to outsource the bulk of their discovery work, it is usually to a management consultancy or design thinking agency. These organizations’ expertise often result in superficial product recommendations and roadmaps, based on their own knowledge and capability gaps around software-powered technologies. This means that the client is left “holding the bag” in terms of actually building the product, with the concepts not having been properly validated using software-powered prototypes.
Modern-day product discovery requires a deep understanding of (and an ability to experiment with) technology in equal measure to an understanding of business, design, and product/user research best practices. These streams must then also be concurrent, coordinated activities from start to end. Only in that way can an organization expect to build and maintain a product that has tackled the big risks upfront—be it desirability, usability, feasibility, or business viability.
In short, neither the large organization on its own or the siloed strategy firm to which it turns are able to supply robust and holistic “product discovery” in the case of software-powered products. Without DNA-level product capability, the likelihood that a product will fail is emphatically increased.
Building the Product Right
Building software-powered products right means both building them well—code quality, user experience, and overall design—and building them efficiently—coordinating dependent efforts, anticipating and tackling roadblocks, and moving at a high velocity. In cases where large organizations recognize their inability to do this effectively, they choose to outsource the bulk of their delivery work to a dev shop and/or design studio.
These organizations often prove to be great executors but lack the necessary understanding of discovery work to build a product that meets a real-world need and context. Their job is to deliver on a brief, rather than pressure test whether they are really building the right product. This means that the client loses the ability to easily feed emergent discovery insights back into delivery work as the product’s fidelity moves forward—an important process known as dual-track development.
Without having high-quality product building capabilities in house, potentially successful products are often poorly executed, slow to build, and hurt the overall brand. The siloed firms to which these companies are likely to turn may be able to deliver products well, but the lack of insights-driven discovery work means they end up building the wrong thing.
Channelling resources for impact
Large organizations are intent on building successful software-powered products because they are acutely aware of both the opportunity that such products represent—namely, unprecedented revenue growth, market transformation, and social impact on the scale of Google Sheets, Apple Airpods, and Amazon Prime—as well as the risk posed by failing to develop such products—disruption, obsolescence, third-party platform dependance, brand devaluation, talent loss, and disappointing customers’ increasingly high expectations. Few organizations today would doubt the all-consuming role that technology (especially consumer-facing technology) continues to play in the market.
In the end, helping large organizations build successful software-powered products isn’t just better for them—it’s better for consumers and it’s better for society. These organizations have the scale, financial resources, and industry knowledge and IP to release value-adding products into the marketplace, provided they have the right product development capabilities to help them channel those advantages.
Truly great product development is about so much more than a high-quality products, it’s about creating tools that have a positive impact on the lives of the people who use them. Connected is helping to redefine what great product development really means, helping large organizations release innovative products faster and more often, improving the lives of individuals, communities, and society alike.