Business Outcomes vs. Product Outcomes
We often emphasize that a product should be valuable and usable for our customers and users. We want to please them by delivering solutions to their problems and providing an attractive user interface. Many companies hire product teams that have core capabilities to conduct customer and user research and seek opportunities for making products better in terms of value and usability.
And it is awesome. As product teams, we need to understand customers and users deeply to make their lives better.
Don’t we often forget about WHY we do that? A team may say that it executes a product roadmap (product vision, strategy, and objectives). And this answer is acceptable unless true WHY is well understood.
Products don’t exist without companies. Any product effort should be aimed at generating a business benefit. And any successful product effort is driven by a business need. Successful products have been never isolated from the business. Thus product teams need always understand and remember about true WHY.
Often we are lacking some component in the chain above. In the worst case, we conduct research and deliver solutions without contributing to the product and business roadmap. In this case, most likely, the needs of customers and users are being fulfilled. However, there is a risk to lose control over a product shape and miss opportunities that meet the needs of a company.
Quite often a company itself may overlook the importance of the business roadmap. A company either doesn’t have it or doesn’t share it with a product team. In this case, the is detached from the expectations of the business. In the long run, this gap can harm a company.
Imagine a product team doesn’t possess the product roadmap and tries to contribute directly to the business one. It means that most likely the team is lacking information on customers and users personas, market needs, value proposition, and competitive products. Indeed, continuous product discovery (interviews and surveys) helps find opportunities to address business needs. I think that the product discovery may yield business benefits without the product strategy, but in the long run, a product may turn into a “feature soup”. It may lead to lost focus and ultimately kill the product.
Thus the task of a product leader is to make sure that any product effort contributes to product outcomes in a way to achieve business outcomes. In other words, the product effort should change the behaviour of customers and users by addressing their needs, and this change should benefit the business.
For example, let’s say a product company wants to increase revenue (business outcome) by targeting a new segment of a market (business strategy) to help people lose weight (business vision). It means that a product team needs to put effort into making people from the new market segment customers of a product. Therefore the team needs to conduct market and customer research , create the to target the segment, and start the execution phase by seeking opportunities continuously to address needs of these people and deliver solutions to them.
The picture below shows the alignment between business outcomes and product outcomes. The product outcomes come from the product strategy. They are aimed at customers’ and users’ success. In turn, business outcomes are aimed at company success that is achieved by achieving product outcomes.
When a product team aims at achieving product outcomes, it places customers’ and users’ needs, wishes, desires, pain points at the heart of any effort. And it meets only those customers’ and users’ needs which contribute to business outcomes. By using this approach, the team can ensure delivering value to both the target group of people and company.
Moreover, the team takes full responsibility for product outcomes. It helps easily measure progress at the product level. As soon as a product outcome is achieved, we can jump to conclusions that contribution to a business outcome is made because product outcomes drive business outcomes.
Would you like to learn how how to translate business outcomes into product outcomes? I recommend enrolling the course run by Hope Gurion, the coach to product leaders and product teams seeking growth through customer-centric, evidence-based strategies.
Also, you can read a great article Empower Product Teams with Product Outcomes, Not Business Outcomes by your potential future instructor.
