There are three fundamental systems that have to work really well for you to be able to innovate consistently.
One is people. You have to have hiring systems, motivation systems, and team design systems that really work well.
Your partnership between you and HR, the center is, people call it strategy but it's more than that.
It is, where will the market be on our customers be one year, maybe even to three years out?
And not only that, how do you distill it in such a way that everyone in the organization can know it and act on it all the time?
And then the third one is just execution.
like how do you actually get this stuff done the shipyard is basically the people in order to do AI at the core you have to be clear about a couple of things how do I compress the workflow how do I disrupt this workflow how I jump all these steps and just get to the answer that's fundamentally how you need to think about it if the problem is a problem that we call like the persistent problem no matter what the technology is it's always going to be a problem you need to get from destination A to destination B cab hailing taxis whatever.
That is a fundamental problem.
You have a destination, you're here, you need to get there.
That's fundamental.
The way in which you'll get there will change as technology shows up, right?
So AI at the core requires that you get to the heart of what the true goal the customer has is, what the problem is, what their goal is, and then re -examine the workflow.
Creating great products isn't just about product managers and their day -to -day interactions with developers.
It's about how an organization supports products as a whole, the systems, the processes and cultures in place that help companies deliver value to their customers.
With the help of some boundary pushing guests and inspiration from your most pressing product questions, we'll dive into this system from every angle and help you think like a great product leader.
This is the Product Thinking Podcast. Here's your host, Melissa Perry.
Hello and welcome to another episode of the Product Thinking Podcast. Today I'm excited to have back Ogie Odezwe and Azeena Odezwe.
As principals at ProductMine and former leaders at companies like Calendly and Typeform, they bring a wealth of experience in innovation and product development.
Did you know that between both of them, they have almost 20 patents?
I'm thrilled to dive into their insights and discuss their new book, Building Rocket Ships, which has been making waves in the product community.
community. But before we talk to them, it's time for Dear Melissa.
This is a segment of the show where you can ask me any of your burning product management questions, and I answer them here every single week.
Go to dearmelissa .com and let me know what's on your mind.
Hey, product people.
I have some very exciting news.
Our new Mastering Product Strategy course is now live on Product Institute.
I've been working on this course for years to help product leaders tackle one of the biggest challenges I see every day, creating product strategies that drive real business results.
If you're ready to level up your strategy skills, head over to productinstitute .com and use code LAUNCH for $200 off at checkout.
Here is this week's question.
Dear Melissa, I work at a SaaS company that originated as Outsourcing, custom software development business.
A few years ago, the company acquired a product company, but continued to manage it the same way, building whatever the client asked for, just using the new SaaS platform.
As a result, there was no real product thinking in place.
After a year of my role, I've managed to organize a backlog and introduce a product vision.
However, due to old habits, we still bring in dozens of new ideas and product variations each quarter.
This makes it nearly impossible to maintain focus on a roadmap.
In fact, we don't really have a roadmap, just a feature compass that I map along the user journey to track what we're building.
My question is, what is the best way to separate and prioritize features and backlogs in an ever -changing environment?
Are there best practices for categorizing ideas under themes like vision, feedback, and tech debt?
So the short answer is yes, you need a classification system and OKRs.
The way that I like to think about it is what are things that are strategic?
What are things that our customer requests?
Maybe not strategic, but things that might help us either close a deal or it's a really big customer and they're in danger of churning.
Things that we really just need to get done sometimes to save our business.
I call this sales debt.
Stuff that the sales team or your consultants, right?
Former consultants are basically promising to customers that may not go towards a long -term vision.
You also wanna think about what are bugs, what are tech debt, all of those different things in there.
Now, once you have that, you're making a portfolio and part of your stuff is going to be strategic.
That goes along with the vision and helps you get there.
It helps you reach these okay arts.
Now, my question for you is on that strategic part, are people aligned with your vision?
Did you do a lot of work to get them all aligned and say, hey, here's the product vision.
this is where we're going after.
This is why we really have to double down on it and not just build whatever.
It sounds to me that if people are still pushing stuff in there and treating it like a consulting mindset, you might need to do that first. Make sure that people feel really comfortable with that vision.
In addition to having a portion towards strategic, you do have a portion towards bugs.
You do have a portion towards tech debt.
And sometimes, let's be realistic, you do have a portion towards customer requests.
One of the most important things that you could do is really show people and break it down.
What amount of money are we spending on each one of these?
Now, when you're showing that to leaders, those customer requests and those sales debt things, there's a high margin to actually being able to do that.
Maybe you take their approach to actually surface up how much money we're spending on that and what the margin is that we're actually going to return if it's one -offs for customers here or there versus the strategic stuff that you're doing and what the growth potential is and what you can actually be able to return on that.
that. That's one approach that I like to show.
And once people see that, they start going, oh, that's interesting.
It might also be a mindset thing where they're not really understanding that by doing all of these customer requests, building a million different versions of your SaaS product, you're going to have tech debt on there, your margins are going to be lower, and you're not really a SaaS business.
It's going to be harder to scale.
You might want to paint the picture and give them options and say, hey, if we're still going to go this way, this is what our business is going to look like.
Here's our roadmap.
Here's what we're doing.
That's okay hey, if you choose to do that.
But if we go this way, more on the product side with this product thinking, here's our potential for margins, here's our potential for business, here's our potential for growth.
And then we're just building something once.
Occasionally, we might have to step in and do something custom, but we should charge extra for that.
So that's how I have gotten through to people who really get stuck in this mode.
And it's a very common mode, especially when you're used to just doing custom software.
But you want to bring it back to why do you care about SaaS in the first place?
And that's because of margins, scale, and growth.
growth. So if you could put it into that context, you might have a little bit better of an approach and a little bit more, let's say grace and convincing people that you just can't dump a bunch of requests onto your backlog.
I hope that helps. And again, I wish you the best of luck.
If you have any questions for me, please send them to dear Melissa .com and I'll answer them next week.
Now it's time to talk to OG and Azina.
Welcome to the show.
It's great to have you both back.
Always fun hanging out with you.
Yes, good to be back.
I am excited because you have a new book out there called Building Rocket Ships, which I got to read very early on.
And I think it's just really helping a lot of organizations and a lot of product managers out there understand what it takes to be a great product manager, but build high performing teams. So can you tell us a little bit about what motivated you to write this book?
Given our career and some of the work we've done with startups, as well as people internationally.
One of the things we noticed was that most people didn't have access to what we perceived as world -class product management.
Many times it felt as though if we sent them to some website or asked them to read a book, they were starting from the middle of the plot, right?
There wasn't clarity on the why behind some of this.
Like the Silicon Valley folks were just talking to themselves, right?
Because they They had the background and all of that.
And we found ourselves repeating the same thing.
Like, hey, it's about finding a problem.
Okay, why then does it matter how you build and not take direction from others?
It's because the customer should be at the heart of it.
So these were fundamentals that we found ourselves repeating, repeating.
And we felt, okay, it's time to just put it in a book and not assume that people understood the why behind some of the things we do as product managers.
That's the core thing.
We wanted to give back.
Particularly, I mean, we're immigrants.
We came from Nigeria.
So we spend a lot of time mentoring and coaching people in the U .S. as well as outside and just having something that they can reference and have available to them to understand some of the fundamentals was important to us.
Ajit, did I miss anything?
No, no. The thing I wanted to add was Because Anthony and I have been super fortunate to be at the heart of the last 20 years of park management, you know, T -Mobile, Timing, Preserve Voice, Procore and Heartside, Microsoft and Rideside, Atlassian, and so on.
And it sort of dismayed us that the diffusion rate of these really great companies and how they build is stuck in those zip codes.
and you go around the world and you see people who they don't just don't have access or the experience you have the shortcuts the nervous system of like this is exactly how to build it's sort of disappointing actually because we live in a world where you think the cost of information is zero and we want to see a world that's abundant for products want to see people make their products make a lot of money happier humans basically a more ethical you know so that's what we did we tried to pour that love into the book you know they say if you if you don't want want people to read anything you just
write a book in a book we don't know if we succeed but we put it out there anyway i you know the good thing is we try to cut like good for our people we try to cover the gamut there's a regular book kindle and hardcover subcover there's a pure edition with isn't that worked on it for so long it has practical downloadable templates content yeah that you can go on if you get the full edition you go on coda the book is digital digital and there's like another book like literally as much content as the book that you can download with your team immediately and the other side of it we are planning to
make parts of the book open source and free for especially for people outside the country who can afford it on Amazon because we you know we want people to actually read this I love that that's such a good mission I feel like whenever I travel outside the United States one of the first questions I always get is do you really think we can do product management here I got that in France you were were like, well, do you think French people and French companies can actually do product management?
Well, and I'm like, yeah.
And they're like, well, it's only like really for Silicon Valley.
Okay. Well, there's, you know, there's parts of the United States that are not Silicon Valley and you'll find fantastic companies there too, but there's beautiful companies all over the world.
And I think that's such a great mission to try to bring that outside of just California there.
Yeah. New York. No, and I try to remember that I remind people to when I first moved to New York, Like there was no software companies in there either.
And then that now everybody goes, oh, New York is like a hub for software.
But it wasn't always.
It wasn't. That's when we met you.
We were out there in New York all the same time.
We met you with the product council days and so on.
And everyone was still trying to grind it out.
Yeah, we were trying to go to meetups and find people who knew what we were talking about.
Yes. People who knew what a product manager was.
Yes. Yeah. It's so true.
Even those like traumatic flashbacks.
Stop it. The early days.
In the book, you really outline this concept of a product operating system, and you talk about it as a shipyard. Can you tell us a little bit about how you came up with that concept and what that concept is?
With the experience we've seen, and also the way we've been very thoughtful with product management, it became clear to us that there's some rhythm to the madness.
Sometimes product management just seems like fighting a fire.
but if you've been in a lot of really good companies you're like look i've seen the patterns behind being good companies and how they do things in a way so they don't become one hit wonders and they can actually make really valuable stuff all the time and we thought about that for a few years actually isn't and i first talked about product systems maybe four or five years ago and we started to be still we started to take time to figure out and study and distill what people are doing well.
And what we came up with is that innovation can't be a hodgepodge.
It can be just, you know, the last CPO and then you come in, you add another layer to process, you don't even subtract anything and so on and so forth.
It started out with a founder, the next product leader, next product leader.
And before you know, you have a Frankenstein process.
And what we distilled was there are three fundamental systems that have to work really really well for you to be able to innovate consistently.
One is people. You have to have hiring systems, motivation systems, and team design systems that really work well.
There's a partnership between you and HR.
The center is, people call it strategy, but it's more than that.
It is where are we going to be or where will the market be and our customers be one year, maybe even to three years out?
And not only that, how do you distill it in such a way that everyone in the organization can know it and act on it all the time?
and then the third one is just execution like how do you actually get this stuff done the shipyard is basically the people it is how the people operate within this product operating system and how you lead them and the book is really organized in that ways the first part is fundamentals so maybe like senior pm to principal pm right what are the fundamentals in building a great product and the last part is how do you run the shipyard how do you do strategy how do you you keep people connected to the same goals.
And this is more a resource for principal to director, to CPO, to CEOs, to CFOs, so that they can partner well with the business function of leadership in the product system.
So that's what it is, three things.
Is there anything you want to add?
Yeah, I think, Melissa, the way to think about it is this.
From my years of experience, and particularly as leaders, as became leaders, whenever you're building products or you're speaking it to the board or working with the leadership team and there was something broken, most people are saying the product organization isn't delivering, et cetera.
It usually comes down to, they're either blaming the people, they don't know how to solve problems, or they're saying we don't have clarity in our strategy, or it's like, we just don't know how to execute.
So whether you like it or not, whether intentional or not, there is this system.
And when you think about it in engineering or what you're saying, it's just interacting components that produce an outcome.
it's this component of humans and how they work together this component of how we just wayfinding like what you say strategy how do we make decisions how do we make choices how do we prioritize there's something about how a company chooses that they are either intentional or they're doing it haphazardly and then the last part is how do they execute how do they ensure that as they release their learning that learning feeds into decisions that are made later how do we ensure that engineering is speaking with design, et cetera?
So whether or not you like it, these are real living things in your organization.
And there needs to be some intention around that design.
And that's really what we try to talk about because how you manage people is a thing.
You can spend hours working on that.
How you create strategy, a thing, as is execution.
But But the reality is that amazing products that scale come to this intersection between these three things.
And that's really what it is that we do, which is speak to how you can optimize each of these three things to get something that is bigger than the sum of the parts.
I love that. And I think it resonates a lot with where I see organizations struggle too.
When a lot of CEOs come to me, they do what you just said.
And so when you said it, I like perked up where they go.
I think it's my people, right?
Right. Like, I don't think my product managers are doing what they're supposed to be doing.
And I'll go in and I'm like, is it just your people?
Is it? What about like the systems around how you reward those people, the strategy?
Like, hey, you don't really have a strategy.
And it's so interesting how sometimes the leaders just don't want to hear that.
Right. They're like, no, no, no. It's it's a it's my people.
Right. It's just that they don't point.
It's easier to point at something else versus something that you have some control over that you're not doing properly.
And actually, some CEOs don't even understand.
It's just like what's happening right now with AI, right?
Everyone is uncertain.
People don't know what they're going to do next because they smell blood in the water.
They need to change something and not sure what to change.
And so everyone is focused on near -term earnings when some people should be thinking about the future of investing in the future.
So sometimes people actually don't know what product it is.
And fundamentally, we secure the future of companies, right?
We secure anywhere from three months to 24 months.
And right now people are like, okay, let's just secure three to six months out because that's what we care about.
So part of this is what do PR people do?
And not from a we do PRDs, but how do they secure the future of returns for this company?
I think people don't really like fully grub that all the time.
It just feels so utilitarian.
Totally agree. And it's that it's the missing of that long term thinking, right?
It's for growth. I was actually talking to somebody earlier about how their company, this very large company, was not thinking about their products that they oversaw were very much like a growth play, right?
investments, that you have returns today.
And their budgets kept getting slashed because they were trying to invest in the core, right?
Where you get all those crazy returns.
It wasn't really seeing that if we invest in these other products over here, right?
In five years, it could be completely disrupting what we have at our core, or they could be adding to it or just as big.
When you're working with companies and trying to explain that model of how you need that long -term thinking for product, what do you find resonates?
Because I've worked mostly in what I call transformative companies that are that know that there's a challenge that needs to be addressed i would actually say that portfolio thinking is actually what has helped portfolio and horizon so i'll just i know all these stories will be different it's actually pretty much the same it is this idea that you have to pay for now like a startup would have to do they're really trying to search and find so you really do have to pay the bills no matter what but you also have to be ready skating where the puck is going to and as an organization i'm I'm one of these people
that really believe that you should serve the customer, but you should also be looking at your bottom line.
So as an organization, you have to be really crisp about how much can we afford to invest in the portfolio for now while not trading out our future?
So that often resonates when people say, OK, I get it.
So, OK, we are in trouble.
So we're going to shift 80 -20.
OK. But if we're doing well, maybe it's 40 -60, 40 now, 60 into the future.
But that level, that takes the conversation into what I call mature territory, because outside of that, I've tried so many things.
And then the other piece I talk about is tech debt and all the other things.
It's changing it from that type of product language to more of assuring our future, right?
Making sure we take care of the things that will cause us to stumble.
So just we tend to want to use our language to speak to executives and that we should actually be doing the opposite because they don't want to see productees to speak to them in terms of business outcomes, what they understand and will always understand because that's the essence of how a company is run.
on so that's that's what worked for me no i do want to say plus one i think for younger companies the one really good portfolio strategy i'm using popular language is like you know 70 percent on what's happening over the next 12 to 18 months right now there's so much of a squeeze in the market you probably want to be closer earlier and maybe 20 for during the near future and then 10 10 % or less for moonshots, things that could completely remake the entire business.
The key is, as I mentioned, is portfolio language, because that's the language of business, that's the language of product.
And this is something that CPOs should do more, especially today.
In fact, even though we say this, our pragmatic advice for product leaders is actually like, right now you should be speaking even more like this, but actually you should be biased into the present.
There's so much uncertainty that if you start talking 18 months, some CEOs will see you as not urgent because they're afraid there'll be no company in 18 months.
So what the hell are you talking about?
So you better be talking about the company in six months, because if you can't secure six months, there might be nothing to secure.
You have a down round, you'll be out of business.
Does that make sense?
That's so important.
And do you see that shift that's happening right now?
I think that's really important because it's like with the AI boom, with the economy, with everything do you see that as a as a pressure from like the ai parts or the economy parts that are putting that pressure on now what's the signal of we have to be looking this far out and i guess what i'm kind of getting at too is that six months might be very transformative for a company as well right like it might be that vision that we would have done in 18 months but like we got to do it now how do you reconcile that and bring it in so let me let me attempt i think it's an answer is what i'll say this it's
complicated you know most tech companies are unprofitable So if you're not profitable, what are you thinking about?
Well, first of all, you're talking about your investors because they're backbiling your existence.
And two, you're thinking about the market because you want to scale so that eventually you start making profit and you don't need the investors so much or you just get a loan to keep going.
And so if you're particularly unprofitable, you've had an up round in 2020, right?
Where money was free and cheap.
You get a lot of pressure from investors and investors are busy at the board meetings and they're saying, what are you doing with AI?
Your revenue is flatlined.
You're not losing money, but you're not growing.
And so we don't see a determinable value of our investments going up.
And so you're seeing a lot of pressure.
And then the production people, people thinking about the three to six months are like, oh my God, that activation rate isn't going up and so on and so forth.
So that's what's happening across thousands of tech businesses right now.
CEOs were afraid that they'll have to raise money soon and they're going to run out and they'll do it at a much lower valuation, which means they'll get fired.
And they have to think of the short term.
And AI is a driver of even more worry than the business cycle because then they're afraid, on top of that, that someone else is going to wake up in the valley, create something over a six -month vibe, code it out, and then they'll be out of business.
So that's what's happening.
So, again, it's portfolio, meaning that you really have to focus on the short term.
You're out of money, you have to fire everybody.
But then some people in the company are a crack team.
At Typeform, I was fortunate, we had Typeform Labs, ads which was helmed by the former ceo and the co -founder david and so we have a small group of people like three or four people who are building the future who are thinking if we got disrupted today what will we use to save ourselves and have that urgent mindset but you can't be when you're talking to a board right now you can't be saying oh we're securing two years out they don't know there'll be two years yeah so let me let me say this i think that if somebody took a soundbite and said focus on the short term they may misunderstand our goal
it's really around urgency right it is there is a huge like it's a confluence of so many things right just last year everybody was talking about profitability the fact that um the markets were struggling with capital there was so much pressure to drive efficiency and productivity and then ai too right so all of a sudden you're trying to be profitable do it being as efficient as possible people are squeezing costs out and at the same time with ai by coding all the things the barriers to entry into your market is happening right here, right now.
And then the other thing is, in the past, we're trying to protect your revenue, not really shake things up, but anybody is shook right now, so it doesn't really matter.
Code base is changing.
So with all of that, there was this idea of urgency.
So I still think your vision, your strategy, your story of who you want to serve, how you want to serve them, how you will make money in the process still has to be generally long -term.
You need to have a compelling story of an ICP that is going to generate income.
But the way in which you attack their problem has to be extremely urgent.
And before, that urgency didn't exist for many companies.
It would take six months to maybe sort of...
Can't do that because other people have seen that problem and want to solve that problem and take your customers from you tomorrow.
So that's what we're seeing.
It's a little worse than that.
You now have 10 million lines of code is essentially like a baggage to you and people are going to generate the one million lines of code that can do exactly the same thing super fast yeah you'll start with it faster too yeah yeah you can't iterate on top of the thing they can and you know access to the market is lower and lower basically people can make a 20 dollar company with like 200 grand now versus a million bucks and so it is a trying time it's not as easy as it sounds actually like Like it's still hard for startups to make it into the market.
But people are worried as if they're going to lose their lunch tomorrow.
And so that's all the pressure.
Yeah. But do you think that is like a healthy pressure for these companies?
Do you think people are reacting to it?
No, I don't think it's a healthy pressure because I think it's causing.
A healthy pressure is when your sense of what will happen is actually true.
Meaning that you apprehend reality.
reality. And maybe in terms of timelines, you apprehend the right timelines.
But I think people are seeing much more compressed thinking of what will actually happen.
We talked about absorption rate.
There are things that have been in the market for 15 years, haven't made it to insurance companies, haven't made it to manufacturing companies and so on and so forth.
So the real economy moves.
There's an absorption rate thing here.
But CEOs right now in early stage, mid -stage, series C, series D are under a lot of pressure.
You know, the money, the cost of money going up really puts a lot of investor pressure.
You have to show up every quarter to board meet and take a meeting.
And so I think there's a misperception of reality.
It is a hundred percent.
I'm just saying like, even, you know, people who believe in vibe building in photo have never built anything important either.
Like how easy is it to build a company that serves a hundred thousand customers reliably reliably with our security holes respecting privacy and gdpr on the basis of a very slight weekend binge weekend coding it's not as easy as it sounds yeah it's not at all and so what we would prefer is that people have a right size sense of pressure they have a right size sense of what it is and they don't prevent themselves from investing the future prefer because i think we see that happening in a bad way and to underscore actually build trap and all the a feature factory thing with the amount of pressure
people are feeling and basic question is this good we think it's a little it's a little much it's not necessarily going to net out and which is also why we believe that if people step back and really go back to what are the fundamentals of what we're trying to do so in the book we talk about the fundamentals of product the next thing we talk about is actually how do you actually create a winning long -term strategy by really understanding economies of scale economies of scope why platform matters so if you want to if If you're going to look at the problem space and step back and really truly intentionally
design, like intentionally put together your solution, you end up winning.
People are in such a hurry to just build.
And in the end, I talked to Ajit about this.
It's going to be a graveyard of tons of apps and tons of things.
And I was telling him, it's like the fast fashion of code is upon us.
It's like just all of these things will be littered with a whole lot of people's content in all these apps that don't survive because they run bills right or wrong but people will make money.
So let's not get it twisted.
They will make money.
But if you want that enduring company and a product that will scale just you've got to slow down just a bit.
Think about it, but still work with some sense of urgency.
We're burning our people out with some of the fretting that's occurring.
I think it's very hard. Like you were saying to be a VC -backed or PE -backed company right now because I've heard from them.
Like I've sat in board meetings where talked about, we should be cutting our workforce X amount because like AI is just going to replace this percentage.
And then I've heard other investors talking about like, how fast do we think we can get to delivery?
And it should be tomorrow instead of that, just like ship it.
So I think there's so much like noise to filter through as product managers these days.
And that's like a huge burden.
What's your like advice advice for trying to keep the pressure from the board members, the founders, the CEO?
How do you get that space to focus on that vision?
I think that's always been a product management issue.
But what's your advice for people to say, if you do want to craft a greater long -term strategy, let's say, or something that will last, what should you be doing to approach that?
And then how do you communicate that's what you're doing in a way where people aren't going to chew your head off?
This is the hard part of product leadership.
maybe the hardest part pms talk a little about prds and specs and running teams at least at the senior but this is the part that very few actual people like i guess the people who think about this are in the thousands not millions of people in the world and so because our profession is mostly apprenticeships it's actually hard to get right because you don't have any people to mentor you like you have like a ceo a very good leadership succession engine in the company that's a decent size.
So here's what, I'm only gonna say some of the things that I've learned and then I've learned things that are similar and different.
I'd say the, you know, the thing you've got to do is if you're a leader and you get into an organization and have these worries, the first thing you have to do is put points on the board. So be urgent and find the biggest problem you can solve in the shortest amount of time because the currency here is trust and communication.
You need to have people be able to trust you and one way to trust you is to act, right?
And then that doesn't get rid of, you know, Shipping does not solve communication, right?
Because people very quickly get used to this, the new rate of movement that you've achieved with your engineering partner and say, now go twice as fast, which sometimes is not possible.
So the next thing is you have to communicate and set expectations.
Here's what we will do.
Here's what we think it will yield.
And here's how much time it will take.
And actually you should sandbag that because again, there's a lot of pressure.
And then one of the things that we've learned through hard experiences don't just talk to your ceo you should she be his best friend but talk to the board you know do one -on -ones with the board every couple months with the you know there's seven board membership that are like two or three that are most influential make sure you have one -on -ones with them and again set expectations it doesn't always work but some people are crazy and they don't want you to set expectations they want what they want because you know they have bankers knocking on their door and they're not whoever that is but i think these
are some of the things we've learned about how to ride that wheel.
I'll add something and it's very specific, but it's because as I look back on my career, it just has been this drumbeat, which is really making sure that we are aligned on what problem we're trying to solve as a board, as a leadership organization.
And then if we are aligned, what are the options that we have?
Most times, I think people think they have to go off somewhere and ta -da solution and the board misses them they don't quite are not so to aji's point of communication it's like really getting everybody on the same page i call this an alignment context setting this is the context within which i'm working this is how i understand the industry here's how i understand the customer you are really really be clear on what problem are we trying to solve we're trying to be profitable get to rule of 40 okay by what time just really make sure that's clear right and then present what are the options that we
have before us right because people tend to forget that strategy is really about choice it's about decision making like your pms make decisions down the path but strategies what decision are you making about how we will win right so then lay before everybody if this is our goal these objects we're on the same page here are the choices we have and here's the timeline of those choices very key yeah so given that here's what i chief fraud officer is saying we go and do.
There can be debate then.
It's constructive. There may be something you didn't quite get.
Some other board member has seen something happen in another industry.
Then we can have truly constructive conversation.
And then maybe we can't pick one.
Maybe we only have three.
We take some bets and then we go down.
So as I look back on the things I've learned, the things I did poorly, the things that I did extremely well, it really comes down to that context setting, getting on the same damn page on what the hell I'm trying to solve for and what are the options we have in front of us?
And just keep beating that drum.
And when people go off left, right, center, it's like, are we even working on the same problem?
Really continue to hit on that.
That to me is how you get rid of some of that noise and get people on the same page and moving forward. When you're trying to bring people back to that context too, especially with AI out there, a lot of people are just turning to, well, what are we doing with AI?
What are we doing with AI?
What are we doing here?
How have you been seeing people incorporate those stories well and also how have you been seeing people not use ai oh you have a lot more on this but i will say this um a belief i had from the very beginning as i i wrapped up my time at wp engine the thing we kept saying is it is a ai is a bunch of toolkits let's be very it is technology it is technology that makes us amazing because it helps in our productivity but it also helps rethink the workflow and how things are solved so it is a a whole bunch of tools but we have to break it down to its core capabilities what does it provide for us so when you
say how about ai what exactly do you mean do you mean how we work with ai or what aspect of ai how does that influence the workflows that we're trying to solve for and this b2b company so just breaking it down and saying what do you mean when you say ai right so that we're talking about the same thing that That was always helpful and important.
And I think that I feel really lucky that the board that I worked with and the private equity firm that I worked with really got it.
They would come into the room and we would actually work through stuff and say, well, not this part, not this capability within AI.
We mean this other one is like, oh, okay, good.
Let's come back to you tomorrow now that we understand.
So I think breaking it down to what exactly do you mean when you say AI, it's more of a toolkit of tons of capabilities.
So let's break it down first. Yeah, no, I agree.
The thing that people of all sort of levels of the organization is sort of two things happening with AI.
One is a lot of excitement because it's a gold rush.
You can't ignore it.
You can't make it cerebral, right?
You have to sort of mine that excitement.
So simple things, you know, we create AI channels on Slack, have people contribute ideas, experiment.
You have to capture that energy and you have to turn that into real things in the product the only thing you have to make sure it's not like playing magic AI pixie dust it doesn't matter it has to be it has to be real and then for the adults in the room you have to do what is that talked about which is you sort of talk them down what exactly right work capability how does this serve the workflows of our target customers in creative ways because this is more careful crafting versus spending six months building something that no one will ever use which will reduce people's trust, again, trust in your
ability to do anything.
You have to play the inside and outside game of the frothiness and the excitement or the inside game of closer to the business and investment and return on capital.
I'll give you an analogy.
When the internet came out, I shouldn't say that.
You're aging yourself.
I was just a baby when the internet came out.
I was a wee lad. When the internet came out, Microsoft, I wasn't there yet, but they came up with a browser.
They actually, and recently worked on Mosaic, a public project.
He left. They found a nasty.
Microsoft bought Mosaic, and that became the core.
This is internet history arcana.
Bought Mosaic and turned it into an explorer.
Like Bill Gates had this seminal moment.
The internet is everything.
This is what we're going to do now.
And he bought a browser, and he started working on it.
And the browser took over the internet.
It was 90 % market share.
It turned out that the browser wasn't where the action was.
The action was Facebook, Google, Twitter, Salesforce.
These things that didn't think about the presentation layer of the internet, but like used it at the core, right?
The core of human need.
That's the thing, the human need.
The core of human need, but also the core of the application.
They used us to transport, to exchange API calls faster than our PC and all the people who are engineers on Teams, is what we're talking about, right?
right they dug it deep into the app it went into the dna it wasn't just like on top of the gooey yeah we were obsessed with we were stuck with browsers and fighting chrome and all this stuff that's what that was like it's like napoleon right he doesn't fight near the port where people have to fight with 500 years in europe he fights somewhere else so he can win and so this is exactly what happened so what why am i saying that there'll be excitement for well the most thoughtful part we use when people will say how does this serve our customer exactly this and And it's a capability.
It's just a tool. It's like AWS.
Think about AWS now.
Before, everyone was like, Cloud Gartner.
Oh, Cloud is Cloud.
But now, it's just like, we use this thing to build a better thing.
And so that's how people have to think about it.
And you have to herd leadership, including boards, to think of it this way.
Otherwise, you'll be a casualty.
The other one I want to mention real quick, Aji, we talked about this in the other session we did, is not just how does it serve our customers, but how is it going to change the industry?
When you say you are truly an advocate for the customer, you have to be looking around corners.
So if you're serving the construction industry, for example, what is it that AI is going to do that will fundamentally disrupt the construction industry?
As a product leader working on a product in construction, you should be thinking about that.
You really need to be doing that.
Isn't that as always encouraging to use examples because sometimes we don't want to speak like we're from an ivory town.
But let's give a couple of early examples.
They're now outdated.
But I remember the first time I used AI feature in Notion, I'm like, this is bullshit.
I could do this with a right click much faster.
Why am I using the magic button that does things super slow?
I hate it. And I became obsessed with that.
In type form, we knew that people would make a very complicated brand aligned form that plugs into their website to maybe 30 minutes.
If it did a qualification.
So we set out to do it in two or three minutes.
It's like telling, you do a small wizard, you don't even ask for your brand, we go fetch it, you tell us exactly what you want to do.
And the thing you could do in 30 minutes, you do in two minutes, which illustrates something about what AI does.
What it can do is essentially, AI immediately has a code just for you to plug into.
So the thing that they can do the best amongst other capabilities is speed up time to value, for example.
And so we always look for places where time to value became super magical.
That created net demand because people will be like, Like, look, your stuff I saw uses this thing, and I want it.
And the other guy didn't say anything about that, and we don't want it.
So super practical things.
If you don't do 5x acceleration, why are you using AI at all?
I think that is super core.
And it gets into that whole concept, right, that we were just talking about, like AI at the core versus the edge.
And I'm seeing this rush of, I'm sure you two are, but like the rush of people sprinkling, right?
Like, let's talk a little bit about like what does it mean when, and how has a company set itself up to be AI at its core, right?
And which companies are right for that as well versus what does it mean to just sprinkle AI on the top?
Let me kick off with this.
In order to do AI at the core, you have to be clear about a couple of things.
What is the goal a customer has and what is the mapped workflow for them achieving that goal?
And then you ask yourself, how can I do this?
How can I turn this on its head?
That is fundamentally where you go when you're really thinking of AI at the core.
You're asking yourself, how do I compress the workflow?
How do I disrupt this workflow?
How do I get to the, how do I jump all these steps and just get to the answer?
That's fundamentally how you need to think about it.
If the problem is a problem that we call like the persistent problem, no matter what the technology is, it's always going to be a problem.
You need to get from destination A to destination B, cab hailing, taxis, whatever.
That is a fundamental problem.
You have a destination.
You're here. You need to get there.
That's fundamental.
The way in which you'll get there will change as technology shows up, right?
So AI at the core requires that you get to the heart of what the true goal the customer has is, what the problem is, what their goal is, and then re -examine the workflow.
workflow ai at the edge often is looking at the existing workflow as it sits right and it whether it's the workflow within your application or the the actual living workflow right you first you pick up the phone call the taxi etc etc and you're going to just continue to increment and say okay how can i what to call a taxi right press the buttons a few times so you're not thinking about differently you're instead saying i'm going to ai this step then i'll ai the next step so that's the difference in how we when we're coaching or talking in our workshops that's the fundamental change that the pm
has to have it's i understand the customer i understand their problem and i understand their goal if i had a magic wand how can i jump all the steps and really rethink it so that's one approaching core the other is fundamentally understand the core capabilities there are two ways to go about it breakdown what is ai like oh okay there's some of it that's imaging there's some of it that's this and then ask yourself how do you make these problems that your icp have disappear completely so those are the two ways we coach people in driving towards ai at the core the whole we have our app we have the software we're
going to figure out how we plug stuff in and make it ai ish that is ai at the end and that's what we're seeing a lot of people And you should do that if you don't have an AI story or haven't had time.
Just do that just so you can at least stay in the game.
As long as it's not costing you the investment necessary for your AI at the core.
Yeah, and that's a good point.
You should do both because one is an inside game and one is an outside game.
That's where you start because otherwise your team doesn't have the capability to think, to upend the whole thing.
Like when I talked about 5X brand, whatever, that's AI at the edge.
This is whatever million -dollar business.
We want to make more money, 20 % this year.
How do we make it more compelling?
We don't believe that true AI at the core companies will use a lot of legacy code.
We don't think so. I think there'll be more than 50 % base code, and they'll be brand new.
And this is the dilemma that companies face today.
If they don't do that, other people will do it and do it faster, and they might catch up.
They might disrupt them.
Like how does Gong, I don't mean to pick on it, how does Gong make money in an AI age when it's like 100 grand to get started?
And when some of their functionality, I mean, Siri was disrupted in a weekend.
OpenAI released something and you could hack Siri together after spending a billion dollars on this thing.
This is what we are facing.
I'm going to go back up to the business level.
There's going to be a great replacement.
replacement old code bases have to be either junked or made a lot more models, which is very traumatic for engineers, right?
Or the new things that are coming up, the Twitters of this era will come and replace them just like they did to Microsoft's businesses.
And so there's going to be a great replacement.
Some people will evolve out of it.
Some people will purchase and acquire into it and some people will die.
And that's what's going to happen.
And what we coach is is how do you knock down how do you go fundamental first in in type form we actually like okay i had this whatever million dollar business and we were sprinkling ai into it in ways that mattered because you can do it in ways that don't matter and then we created a form list which was like if someone's gonna kill us they'll probably make this and so let's make it first so that we own it if that makes sense and over time you have to shift to this innovators dilemma and the question is how How do you navigate that shift?
And the next 10 years is really going to be about this story repeated thousands of times.
I think that's so key.
And we had a conversation about that at a conference I was at, not last week, in the weekend before, Friday.
And I was using this example of a company that I've been exploring out there called Digits.
And it's like AI accounting.
And they're still working on some stuff.
But the idea is you don't have to go put all of your things in in QuickBooks and categorize it.
it, it just plugs it all in.
It plugs into Gusto, it plugs into all your bank accounts.
And then it does all that, it reconciles it automatically.
It knows where things are coming from, so it can label it very smartly.
And then you just can come in and manage your business.
And then you have to, if you go and you tweak stuff here or there, they take care of all the stuff in the back end.
You don't have to be a bookkeeper to do it.
Whereas QuickBooks, you have to be a bookkeeper to fix stuff.
And that drives me nuts.
Because I'm like, I'm not a bookkeeper.
But I know what I spent money on i just want to categorize it like that's all i want to do and then yeah all you did was bring it in and then you did nothing nothing so then why yeah so somebody asked me i want your i want your opinion on this because it feels intuit has been talking about ai and i do not work with intuit so i have no idea what's going on there but somebody challenged me when i was talking about this and they said one of the things that they are doing in quickbooks is they have tried ai on the categorization where they try to automate it it's not very good it doesn't happen happen
all the time, but they're saying, well, what if that's like a test into further AI automation?
Like what if we're sprinkling it in there and then trying to go elsewhere?
And to me, like my answer was, okay, like it could be a test, but are we testing on like the most important thing, right?
Like, like what's the, like, what's the pain for me as not being a bookkeeper?
I can categorize anything, but it's a reconciling.
It's all these other things that I don't, I'm not an accountant.
So like I, but you can, there are rules, right?
Like if you follow the rules, you You should know how to do that on the backend and do all of those things.
Especially with accounting.
Look, so we come from an era where software is so hard to make.
You picked a small sliver of a problem to solve because that's the problem you could solve really well.
You're calendly and you're like scheduling.
Okay. If we try to take on the whole calendar, someone will kill us.
So we're going to do this.
It's going to take us 10 years to turn it into a $300 million business, if that makes any sense.
sense we actually we're in a world now with development velocity can maybe go from two to 10x over the next little while so if you're good if you know exactly what your customers want you can actually be more ambitious give you an example of full story and all these clickstream products they brought in the clickstream so that you can understand the clickstream and they said the problem in this clickstream well you don't know what problem you don't know how many people maybe experienced it once you know the problem you don't know how to fix it someone has to go analyze on how to fix it right and that's
just the analysis level and then the next level is okay now we sort of understand the root cause how do we create a prb to solve the root cause and of the 10 problems which one is the most important to a prioritization but the thing is the capabilities like isn't i was talking about of ai is that it can actually do all these things very fast It can even write a PRD based on the data from the click stream and check in the code.
So people are going to get more ambitious.
And people who are incremental, things that don't matter, like QuickBooks, are going to see challenge.
Now, obviously, install base, brand strength, these are all important things.
But honestly, OpenAI is trying to kill Google.
It's trying to kill Microsoft eventually.
eventually and this is the ambition that people who are native ai companies are having and some of them will succeed so it's not enough to be cautious you can't be and you can't be cautious on unimportant things like if i wear quickbooks i would focus on sort of like an assistant that helped you with your real issue is i don't want to worry about this yeah i want to make sure it's done right so yeah and then if i break that down into like what are the top two things you worry worry about that's where I would point AI at and it's not categorized in a column that's not that part is very easy for me
I think that's a great way to put it yeah so when you look at um the future of product management we talked about it a little bit AI is very good at stuff like PRDs being able to diagnose things in our in our data there's a lot of talk about does it replace the product manager you know do we just get rid of everybody what do you think is going to change about product management the next five years this is a topic I know I don't know that answer answer.
I don't know that it answers your question, but I think it really, when people were sky is falling last year, it really pissed me off because I think it pointed out that most people did not understand what product managers do and the why, okay?
I think that, and we opened up like, I think it's in the pro edition, quite frankly, I poured my heart out and said, I think when I look at small companies, big companies, enterprise, B2B, B2C, and then I also look at companies that are more maybe media that are working front managers ultimately PMs have to do three things one is create a solution based for the problem that you are solving for your customer like really solution right and that's where most people spend their time 80 it's the solutioning piece right but then there's a part of your job that is about getting that solution in the hands
of the customers or being the advocate for that solution within your organization and And making sure you take away all the heartburn.
So think about this.
Whenever customer support or customer success or sales has a problem, who do they come to?
The best PME organization is usually the one that they come to, and it's because they know the product.
They know how customers want to buy it.
They just know so much. And customer success, customer support all know this person, right?
So that is hardly ever said or discussed, but it's a really important part of our jobs as part of my is like what is the way to remove any roadblocks from customers experiencing and getting access to your solution and the third is evolving right we keep talking about you should know your customer it's what is going on in this industry what is going on in our customers world that i need to be made aware of so that i can anticipate and build the product so it's the product evolution aspect quite frankly if you're at a startup you're doing all three right if you're in a huge company we'll be doing
mostly the first piece if you're an executive you're probably doing all three you're like well working on the other so it's we need to step back and ask ourselves while majority of the pms may be working on the solutioning piece that is not the only job the best like if you go to any company and figure out who's that best pm everybody talks about they're really doing all three of these or have some credibility across these three areas On the solutioning piece and the communication of the solutioning piece, AI has come and is going to do some really interesting things.
So we're no longer working on a document of requirements.
You're working on software, right?
The space within which you're brainstorming, designing, et cetera, is no longer a document to be translated.
It's actually software.
You're looking at software and clicking around.
And that's really good.
It takes away the, but I said that.
And you read this. it just really takes the refinement process the backlog refinement it changes it becomes spec because it's basically language language exactly exactly you don't have to write not the production code but at least the thing that you idea i'm sorry no please it's that you before you had to take english language on a document and translate it into code you don't really need to do that anymore you could actually be working with it with code and that becomes your core prototype type, and then we move on.
So things have changed there.
No argument. But how the organization experiences that, how you influence the rest of the organization.
I remember one PM saying, oh, darn it.
Our CRO and our CEO built some code the other day.
Now they want to sell it and put it on the website and blah, blah, blah.
That's now a major problem.
They've bycoded over the week.
Bycoded a product. Yeah.
And then the CRO says, let's sell it.
Let's sell it. So as the PM, your job is to figure out, is this in conflict?
Is this not in conflict?
Well, first of all, you're alarmed.
You're like, do I have a job right now?
Yeah. And it's also like, if the CRL and the CEO are going around you and doing that, so what are your interactions with them?
Like, are you plugged into the conversation?
No, because they think you're going to slow them down, so they're not.
Right now, you're on the sidelines and you're alarmed, and your NJs and Devleys are like, holy shit.
What the heck is going on?
Security risk, GDTR issues.
issue. So in the past, the PM had the design resources, the engineering resources.
Well, now you've got ChatGPT and LockableMV.
We don't need you guys.
Anybody can build code now.
So it's a wild, wild west. So I do not think that the job is eliminated.
I do think it evolves.
It is, how do you get all those people in the sales organization that are now actually vibe coding and building all sorts of prototypes?
And you're like, oh, crap, what the hell is going on?
How do you curate that?
How do you get them to the table?
How do you help take that energy and use it towards good?
That's part of the orchestration that we used to say PMs have to do.
That is now part of the job.
So it's just evolving.
How do you build it?
What is the right thing?
To build. Build it.
Get it to market in the best way that creates demand and love.
The build part is going to be subsumed.
There's going to be a lot more competition there.
Yes. But the right thing, which ultimately in the end is what matters.
because it's not the right solution, the right thing.
It's like, in the end, what you want is to ship the right thing, ship it in a way that matters.
That is the job. Part of divining the right thing is going to remain super important because doing it is still going to be arcane sophistry and wizardry, right?
I don't mean that. It's going to be custom listening.
The middle will be a lot, there's going to be a lot of creativity there that's going to transform and someone will write a new actual manifesto.
The end will still be very hard to do And PMs will spend more time in those places because it will uniquely differentiate them in the workplace.
I think that's a great way to look at it.
And so if you're advising the PMs who are listening to this right now, what skills to work on?
What would you say?
All the five or six things that we hire for in our career for a good PM, maybe like a fifth is related to the middle thing.
The middle thing is building.
It's the PRD. It's the running the meetings.
It's like herding the cats.
it's like making sure all the inputs are balanced into the thing that is prioritizing ship and so what does that map to in the skill set we call it basically execution right shipping chops if that makes sense besides that is leadership because you have to gain the confidence of these people is communication and over communication right it's not necessarily in that thing although some of it is creativity being able to work in white space being able to perceive the synthesis of market problems and holy shit, we don't know what to do here and coming up with something that actually works.
It is the customer listening skills that help you do that creativity in the direction of the customer, because you can have creativity at 90 degrees away from the customer because you're like, I have a brilliant idea.
That's some type of creativity.
But if it's not personal to the customer, it is a waste of money.
And so those are the other skills.
So what we tell PMs, you have the shipping skills.
These other skills are going to get more important because it correlates to finding the right thing and getting it to market in the right way.
Those are the things.
And also communication in a world where there's a lot of hurly -burly, right, in the build, your ability to lead, your ability to communicate has to be even higher, right?
You have to walk into a room and people are like, okay, what he said, no matter how young he is, makes so much sense.
the CO is like salute we're gonna do it that kind of bit I wrote an article end of the year and I think it kind of encapsulates what it is that I tell people I mentor and coach the first thing that needed to happen was PMs needed to wake up I just had this sense that people were just going through the motions just on autopilot that's the word yes and the second was so there are about five things I said second ones be curious sometimes we get so into our product and knowing our product but we forget the person using it and the problem we're trying to solve and we're so in we're experts at the product
itself but not the problem right and how the problem is evolving with now that our product is there right um so just that curiosity is really critical and then being bold right taking risk is critical and then last but not least and this This is where I spend time is speaking the language.
And this is going to sound really weird, but technology, customer, business, and AI now.
It is your job to figure out how to translate.
I always say, be a polyglot, right?
Translate this and speak it clearly as much as possible.
That's what I really think people should focus on.
There's a lot of noise, et cetera.
Just be alert, be curious, be bold, and then be ready to be that person that is bringing all the parties together and ensuring that there's clarity because you can speak all these languages and bring those people to the table towards a very clear goal.
That's this, when I talking to somebody that I mentor, that's what I'm asking of them so that they can stand out.
I think that's fantastic advice.
And it's kind of bringing me back to almost like my first day as a product manager.
I remember my boss telling me like your job is basically to communicate Communicate what the business and customer needs are back to tech and figure out how to be the bridge between that.
Now that sounds like that's more important than ever.
And the last thing is to reduce products to more customer discovery, more clear PRDs, just like the middle.
And the edges of those are going to become more important because we have competition in the middle.
I think it's going to be a wild ride for the next couple of years.
Yeah, it will be. It will be.
there's a lot I want to encourage people though the thing is this it was always what your boss said it was always a dual mission, make customers happy make us money that's always been the core of it I think we've gotten less lost in the process of how to do that every digital business every tech business still needs this I love developers but they don't have are trying to be as customer centric as we are and that we are mandated to do and they're not asked to do that and so what that means is one of our partners ted says the rocket ship is accelerating to warp speed but if you're pointing the wrong
direction it goes away from the mission faster right you vibe code let's not call that because it sounds terrible but you 10x developers was put in the wrong direction is terrible for return on capital.
And so the ruddering of what a PM does, a good PM does, is still super critical.
Yeah. I think that's so important for people to remember.
Gina, Zina, it's been so good having you here.
If you wanted to go read your book, where should they go?
You go to Amazon and search for Building Rocket Ships, a blueprint for high -growth companies in the age of AI, and you will find it.
You should go to Shopify and search for the same thing and you can get the pro edition and you will get like 60 plus tools you can share with your team immediately.
So turn it into a weapon, not just a book to read on the weekend.
You can follow us on Substack, all the different places where for free, we try to help the PMs around the world build amazing things.
Productmind .co. So you can find us consulting, you can find us coaching coaching, and you can find our thoughts in our book there.
Okay. And Amazon, obviously you can buy it there.
Amazing. And we will put all of the links to where you can find them on our show notes at ProductThinkingPodcast .com.
Thank you so much for listening to the Product Thinking Podcast. We'll be back next Wednesday with another amazing guest. And in the meantime, if you have any questions for me, go to DearMelissa .com and let me know what they are.
We'll see you next time.
