In 2005 I felt an urge to go back to school. I wanted to learn something new and decided to do a master’s degree. I realized that continuing from my B.Sc. in Mathematics and Computer Science won’t really help me since I’m already working in the space, and even more so since I wasn’t a data scientist or into deep algorithm development.
I decided to do an MBA since I was clearly into management but had very little formal knowledge in it, and specifically on the business side of things. Prior to my MBA, I thought business success is almost random. The business world felt to me like a chaotic jungle, where hidden forces are playing a game that I do not understand.
The first class I took was “Foundations of Strategy“. It wasn’t because I wanted to do it first, it was simply on a convenient schedule that worked well with my day job. Little did I know about the impact it would have on my professional life.
I learned to think and speak in a new language that included things like market forces, differentiation, competitive advantage, barriers to entry, segmentation, and focus. I saw deliberate strategic decisions, which were made after careful consideration and thorough analysis. Sure, luck was still part of the equation, but I learned that it was a much smaller one than I originally thought.
I ended up majoring in Strategy and Entrepreneurship and realized that the right professional direction for me is no longer in R&D. I decided to move into product management, and the rest is history.
Do Strategy and Tech Go Together?
On the other hand, there is the tech world, and lean startup, and agile. Everyone knows that reaching product-market fit requires a lot of trial-and-error. Specifically, a lot of errors. You don’t fully understand the market until you are actually playing in it, so you might be thinking that this “offline” strategic analysis is pointless.
Or maybe, you simply don’t know how to approach it and you feel good with trying and trying again, because you know that’s part of the process.
There are a few things though that you can do, that will help you eliminate the number – and magnitude – of the errors you will make along the way. Follow these guidelines, and if you need help – reach out and we can figure it out together.
Let’s start with what you shouldn’t do.
Blind trial-and-error is also called sometimes “spray and pray”. That is, try everything you can in all possible directions, and pray for something out of it to succeed (the term itself is originally talking about the use of automatic firearms by people who don’t know how to properly aim their weapons, so they are shooting blindly using a lot of ammunition towards the general direction of their enemy, hoping that some of it would hit the right place).
In the tech world, it means spending a lot of time and effort (AKA money) on directions that are not likely to succeed.
Understand the Happy Path
Before you try anything, understand your full path to success (be it a sale or a happy customer or a growing number of users). I know there are many paths that can lead you there, but you need to pick just one for this exercise. It’s hard enough to do it for one, trust me.
Pick the path that you think would be easiest to crack. Describe it as a story where one thing leads to the other. It should be clear and logical. Be as specific as you can. Then test yourself to see if the logic actually makes sense.
Here’s an example:
Say you want to open an ice cream stand. Of course, you need to decide on the location, the flavors, pricing, whether you have a sitting area or not and a number of other attributes. Instead of focusing on these micro-decisions, and trying them out until something “catches”, think about the logic behind it. Here is one possible option, with its happy path and all relevant assumptions:
In Israel people love hiking. There are places with thousands of people every weekend. The weather is also warm most of the year, and people have large families and travel with their kids.
Here is a potential happy path based on the above:
- Put the stand at the end of popular hikes
- When people get there:
- they feel accomplished after completing the hike
- they are hot and sweaty after a long walk in warm weather
- kids are hungry and tired
- parents want to rest for a while
- Kids will see the ice cream stand and will ask their parents to get some
- Parents want everyone to be happy and continue the fun day they had, so many of them will agree
- Other parents will simply not have the energy to resist their child who is asking for ice cream again and again
- Once parents decide to buy ice cream for their kids, some of them will buy ice cream for themselves as well
- If all of the above is true, then…
- They will buy from what you have, selection almost doesn’t matter
- No need for a sitting area
- Price sensitivity is low, you are the only option there
Now do it for your own product. It can take time (see the last point below). Remember, you don’t need all the paths, just one – but take it to the level of detail that you can actually hold yourself accountable for in terms of the logic. That is – a level in which you can understand how one thing leads to the other, and of course, it has to end with the desired result (in the ice cream example above it’s the parents buying ice cream for the kids as well as themselves).
After you’ve done it, read it again and see if it makes sense. Maybe something is missing, or some conclusion isn’t directly derived from the previous statements.
You need to bring it to a point where it seems plausible. You don’t need to know for sure that it would work – because to do that you need to develop the product and bring it to the market. But you need to look at it and feel that all in all it makes sense, and you understand that sense exactly and can explain it to someone who doesn’t know your product in and out.
Note: Some statements, when put in the context of the entire story, don’t seem plausible at all. If that’s the case you need to stop and rethink your strategy. If this happens, it means you got immense value from this exercise. Since error is a natural part of the process, the important thing is to catch it on time and make the necessary changes.
Rate Your Confidence in Each Statement
As you read through your logic above, there would be things you are less certain of than others. If these are fundamental to the success of the process, these are the things you want to research and test first.
Conduct your offline research, and refine the logic and assumptions based on what you learn along the way. Some things can be verified with experiments that don’t involve a product (for example using landing pages to test the interest in something, or counting the people who hike in a certain place for the ice cream stand example). Then see what is left to be tested with a real product in the market.
Note that at first it’s not the product that you want to test, it’s the need. Build your product accordingly and make sure you measure the need. Once the need is validated (and probably refined), improve the product so that it fits this need. Don’t fall into the trap of having a product that you don’t know exactly which need it satisfies.
Take Your Time
The process described above sounds simple, but it is rarely so. It involves putting in writing many things that were vague thoughts in your head up until now. It most likely will require research, and figuring out abstract ideas. It requires multiple iterations to be done right, and that’s before you get to a single line of code.
As Jeff Bezos said about Amazon’s famous 6-page memos which are the basis of each meeting they run, no matter how strategic:
“The great memos are written and rewritten, shared with colleagues who are asked to improve the work, set aside for a couple of days, and then edited again with a fresh mind. They simply can’t be done in a day or two.”
If Amazon can’t do it in a day or two, you should take your time too.
And if you don’t want to do it alone, reach out so that we can crack it together.