We recently sat down with product guru Bruce McCarthy to discuss all things product, product-growth in start-ups and current industry trends:
Well, it's great to be together today to talk about startups and to talk about Product Management. My colleague, Andrew Shaw, and I are excited to be joined today by Bruce McCarthy, who we met earlier this year through one of our mutual clients.
Bruce is an Entrepreneur. Bruce is also an Author, which we're going to talk about a little bit later in our time together. Bruce is also a Founder of a consultancy called Product Culture.
Bruce, first of all, thank you for being part of this discussion today. Why don't we get things started by having you tell us a little bit about Product Culture and the work that you do?
Sure, thanks very much. Product Culture came out of my long years of experience in product-oriented, product-led sorts of organizations. For most of my career, I've been in Product Management but the thing about Product Management is, it's a very horizontal leadership role and so officially or unofficially, I've ended up being in charge of everything from engineering to design, to partnerships, to agile enablement. You name it. So that's given me a unique perspective of how all the parts ideally fit together and reinforce each other to make an engine that goes faster than just the parts alone.
So, now my work for the last 8/9 years has been working with companies trying to tune their engines, trying to help them get more out of their investment in product, cross-functional product teams. How do I do that? So, we work together on, first of all, objectives. Usually, there's a need for a roadmap or a set of OKRs or some other way of articulating, where are we all going?
I help companies do that well, teach them the skill and also help them organize their teams all around those outcomes that they're looking for. I helped one company nearly double their valuation just this year, working with them on OKRs, coaching them on strategy and their strategy development process and their roadmap, helping them through a reorg and to integrate an acquisition. It's really a holistic approach to how we get you to where you want to go in terms of a product-led organization.
Wow, that's phenomenal. That's a great overview. Thank you so much for that. You know, I have to imagine working with as many companies as you do and have done that. You've probably seen a few crazy things or unexpected situations unfold. I'm just curious if you can share an anecdote or a story, maybe it might have, you know, made the episodes of Silicon Valley or maybe not, but you know, anything funny or cute that you'd like to share today?
The sort of funniest or scariest story I can remember about really trying to set direction and make it clear what the measures of success are in companies is this one company that I worked with some years ago, where they were really proud of the fact that they had set goals for each of their teams and even tied bonuses to those goals and they were confident that it was going to get them somewhere.
But they did seem to be having a little bit of trouble with alignment between the teams because, and it turns out when I dug into it, the product management team, their goal that their bonus was dependent on, was shipping new features. Not about whether those features were good or bad but just let's ship them.
Whereas, the engineering team's goal, which they were also bonused on, was to ship on time. So the engineering team kept saying, "No, we can't fit that feature in because it'll cause us to be late. No, we can't fit that one in either." The product management team is like, "No, you must fit that one in."
Worse, the QA team was bonused on filing bugs, as many bugs as possible. So they were just coming up with anything and everything that they could cram into Jira to file bugs and engineering was just closing all of them as not a bug because addressing them, good or bad, would cause them to be late.
So the three departments were all pointing at each other saying you're the reason I'm not meeting my goals and that's just so backward compared to where you want to be, where setting team goals should be about creating alignment so that everyone is working in the same direction rather than pulling in opposite directions.
The way that works well and the way I helped this company reorganize its approach was to set the goals at the cross-functional product team level, not product management team but product team, a team that owns a product which consists of Product Managers, Engineers, Designers, Data Scientists, Marketers, whoever you need in order to make the product successful.
That's really interesting Bruce. I wonder if there's any more commonality and challenges that you see when you're working with your clients around really working towards that product-led growth model. Are there any commonalities there?
Definitely, I think it has to do with PLG's really positive model of getting customers to try your product in order to get them to become customers. So, it really forces you as an organization to think holistically across all of the different functions.
What is it going to take to make the customer fall in love with us, to make them want the product and want to use the product so much that they're willing to buy the paid version of the product or convert from a free trial to paid ongoing customer?
It means we have to figure out what it's going to take. We can't just say we think if we build these features that will do it by itself. We have to test those assumptions. We have to try to see what works, see what doesn't work, learn from that, change course.
If you're used to focusing though, as any sort of long-standing organizations are, on simply the efficient output of features, you're really not well equipped for that tuning of what you're doing of your roadmap, your backlog, your whatever you have in Jira, to those customer needs, listening to the customer when they are speaking through their actual usage of your product or their willingness to go from a free version to a paid version.
For that, you need, number one, good customer discovery that combines qualitative like interviews, listening, open-ended questions with quantitative like watching what they actually do, watching what they actually click on, watching how often they really log in.
An experimental mindset is also necessary. That's focused not on, did we get this feature out, but what did we learn from how this feature did or didn't change customers' behaviors and rapid iteration, to be not like, well, we know we want to ship these 10 features. Let's figure out the most efficient way to do that and we'll have one big bang released at the end of the year. Well, that's not a way to learn. That's not a way to iterate. That's not a way to tune your offering to the customer.
It's a way to use a waterfall approach to efficiently ship things that you have about a 50/50 chance according to industry studies of making a difference with.
Wow, it makes a lot of sense for sure. Talking a little bit about the sort of people, you've worked with great people I would imagine in your career and your consulting business, what makes somebody a really successful product leader? Are there any key themes or traits that you've come across in your work?
A lot of the time hiring managers when they are working on the job description with me for a product leader will put down things like they want someone who has 10 years experience in their industry or the will put things down like they need to have a CS degree or they have to have been an Engineer because they want to tick the boxes of some market knowledge and some technical knowledge.
Those things are useful, don't get me wrong but I think they're actually the least important factors for success, for a product leader compared to what I would say, I call empathetic communication.
That is, they need to be able to have a two-way dialogue where simultaneously, they are really articulating for a stakeholder internally or a customer or a board member articulating a vision clearly of a future world where things are better for customers and things are better for the company as a result, and they also then need to have made that, clear articulation of vision need to shut up and listen.
And hear how people react to what they've said, so that they can again, just like the product tune their message to the audience. They need to be willing to just have an open-ended conversation that might start what's going on with your kids and lead to telling me about your job and what success looks like and where you might be struggling. That leads directly into how you use my product in your day. Does that make sense?
Absolutely, makes a lot of sense. The marketplace we're seeing today, you know, there are new announcements each and every day, it seems like with money coming into companies and investment being made, when you're working with a founding team and they've raised a lot of money recently, how do you guide them through that? Where do they may be to make this money work for them?
Yeah, that's a really good question. Often when a company gets to something like, Series B, they've reached some level of product-market fit, they have something that they can sell on a repeated basis and they're looking to really scale, they're looking to really grow this thing bigger, and so what that means is that, as entrepreneurs, they're shifting emphasis from building a great product because they actually have succeeded at that big milestone at that point, to building a great company.
A great company that can really take advantage of that product-market fit and scale it, fully commercialize it, and fully captures that opportunity. That's a different focus. If they're used to being the kind of Founder/Executive who is down in the weeds of the Jira tickets and the wireframes and everything, they're going to struggle to have enough bandwidth to pay attention to building the team around them and allowing that team to carry the company forward, providing leadership rather than management is the big difference at that point.
So the number one tenet of leadership in my mind is to hire great people, let them do the job rather than you doing the job like you had to do for the first few years.
Number two, be that empathetic communicator with that team, give them a clear direction but then, you know, do get out of their way and let them do the job. This is a big struggle for a lot of Founders. The product, the organization, everything, it's their baby, so delegation is hard.
One of the other really biggest struggles after that is, okay so you've raised a bunch of money, you're focusing on building out the team, we can do everything now, right? We can pursue every idea that I ever had or ever will have as an entrepreneur because entrepreneurs are good at coming up with good ideas, right? So prioritization is absolutely necessary and really, really hard, especially if you feel like you have a lot of money in the bank and you should be able to do all of this stuff.
One of the things I spent a lot of time working with teams on is focus. Let's actually have a great big, huge list of everything that we could or should pursue, but then let's cherry-pick out of that the 10 x ideas, the ones that are great ideas, not just good ideas to pursue first, and then let's not say no to the other ones, let's just say these first.
Great, thank you. That's a lot to chew on. I always get excited when I start, you know, people are always asking us, Heidi the market's so crazy, what do you think the new year is going to hold? Where are things going to be in three months? In six months? We all dream a little bit. We all hope that these good days are just going to go on forever and hopefully they will for quite a while. Do you have any predictions or are you placing bets on anything for 2022 Bruce, whether it be, in the ardent science of product, what the future might hold, or about tech in general?
Well, there are two things that are on my mind as trends. One of them is long term and the other one is short term and COVID related. Long term, I'm seeing increasing cross-pollination between the practices of B2B and B2C. That is, B2B players have traditionally felt like, well we can't do the things that the B2C people do because we don't have the numbers, right? We can't instrument our product and do heat maps and get data back in days for what the effective UX changes were. I just don't think that's true anymore.
A lot of B2B applications have hundreds or thousands of users logging in every day, some have millions. The technology is there today to actually make a small change and see what happens and monitor. I've worked with companies that are doing exactly this right now. Similarly, B2C companies have found ways with usertesting.com or with other services to do quick and dirty interviews that actually inform their more quantitative usual analysis. So I love seeing that cross-pollination between the two.
But the other trend that I'm thinking about is the working from home thing that we've all been doing the past year and a half, almost two years now. I think that I expect some companies at some point to swing the pendulum way back and say we really want you all back in the office now, that it's safe to do so and we'll work hard to make it safe and there'll be a push back against everyone working at home before and for good reasons, you know, we get more done, a different kind of thing done.
The empathetic communication sort of thing comes more naturally when you're in person or talking over coffee or some other beverage. So I think there's going to be a swing back to that, but I don't think that it's going to be a swing all the way back.
I think I worked with several companies who have made a permanent change to being remote-first and they started hiring people that don't work in the same city as them. I worked with this one company that has decided to let all of their office leases go at the end of their term and they're just… they'll use co-working spaces where necessary if people really don't want to work at home.
Thank you for that. Let's get back together again at the end of the year and see where things have taken shape. Bruce, I want to end our time today talking about your book. You are an author of the book, Product Roadmaps, tell us about this book, why it came to be, and who it's been written for.
It's really for anybody who needs to work with their team, with their stakeholders, with anybody else to create, align and execute on any sort of plan. My background is software and so it came out of the tech business and best practices there.
But what I'm finding is that all businesses seem to be moving in the direction of adopting some of the innovations, not just the technical innovations, but the team orientation, and the goal orientation of really great Silicon Valley companies.
So I'm now… I work with nonprofits, I work with an electric utility, all over the world, in Europe, the electric utility is in New Zealand. In the United States, companies that you don't think of as tech businesses are adopting road mapping, are adopting OKRs, adopting a product-led sort of culture, a cross-functional team sort of approach.
This book really speaks to anybody who needs to take that journey. It's about the technical discipline of putting together a roadmap. But it's about a lot more than that. It's about the whole sort of mindset and process and team orientation of doing this together as an organization.
And it's about fundamentally a shift in the mindset from outputs, the features we put out there on the dates using these resources and these budgets, which is kind of the old-fashioned approach to road mapping and an emphasis instead on outcomes. What are we trying to accomplish? What difference do we want to make in the world? How will that drive our business? It's more of a strategic roadmapping sort of approach.
We're finding that people are finding it, like the missing link for them between the company vision, which all sounds really good but how do we accomplish that and their backlog of tickets in Jira. How do we connect those two? Well, we need a strategic roadmap, we need a description of if we do these things, if we solve these problems, we will reach our vision. That's what the book is about.
Beautiful. Bruce, thank you. Thank you for sharing your thoughts and your perspectives and your knowledge and just everything that embodies this topic and subject matter of product management, especially for startups.
For anybody who's watching, thank you for joining. We're going to link Bruce's information below and we invite you to reach out and learn more about Bruce, Product Culture, and about his book, Product Roadmaps. Thank you again Bruce for being with us today.
My pleasure. Thanks, Heidi and Andrew.