To stay competitive in technology, you need to adopt a roadmap based on business outcomes, not features. Here’s why and how to do it.
8 minute read
When it comes to product development, the feature-based roadmap has long been the go-to strategy for software-based businesses of all types and sizes. This methodology requires teams to work off a wish list of features that have been decided upon well ahead of time by various customer and internal team demands. While centering a development strategy around adding features might sound good in theory, in reality, it’s an approach that operates more like a big gamble than a strategy connected to any particular business goals and objectives. Seem counterintuitive? Let’s explore why.
These artifacts often come to represent “promises” to customers that teams must deliver despite more recent or more strategically advantageous opportunities the team otherwise cannot pursue. Competitors release a new feature that’s stealing market share? End users demanding a new feature over and over, inundating the customer support team with their requests? Too bad: We can’t accommodate the request to deal with this new information for six to nine months because we already have our roadmap of features!
As software development is the single most expensive resource a business incurs, it’s important to treat your software development operations much like that of any kind of investment planning and strategy approach. Rather than setting our strategies in stone from the get-go, we want to take small, calculated gambles (or “bets,” as Basecamp’s founders call them) on what teams will do next and what they hope to learn from the next step. As teams evaluate the soundest ideas to bet on, an outcome-based roadmap gets increasing fidelity as to what bet the teams will be making and how they’ll measure whether the investment strategy paid off. And if it didn’t? Just reassess with this new information. Unlike the shackles of feature-based roadmaps, outcome-based is designed for agility. We move away from “do whatever it takes to build this thing” to “do whatever it takes to improve this metric.”
To create a sustainable competitive advantage that encourages innovation rather than stifling it, organizations need to move away from a fixation on features and, instead, develop a purpose-driven strategy that looks toward outcomes.
Why It’s Time to Move to an Outcome-Based Roadmap
While companies using a feature-based roadmap may still be producing lots of things, that doesn’t mean they’re succeeding. In software, the winner isn’t who builds the most stuff. You succeed if you build only what your customers need and no more. When teams only have time to focus on delivering features, they don’t have time or opportunity to understand whether what they built actually solved the problem as intended. Teams plagued by this end up adding endless complexity, bloat, debt, and expense to the product, making further development slower, riskier, and harder. As a result, the entire system slows down—as does the business. Even worse, leadership often can’t understand why, leading to increased demands to deliver more—and faster. The problem perpetuates itself. And in the end, the business burns through cash too fast to succeed.
After all, businesses don’t run on numbers of features built on time; they run on results of features over time on the user and the business. They run on changes in behavior that drive measures of business success. These are the outcomes your strategy should be built around. Slack is a great case study of this in action. The chat concept was originally a feature embedded within a failing video game platform. Chat was so much more engaging to users than their primary product and proved viable and scalable over many small iterations of the feature before ultimately triggering a complete business model pivot.
When centering on outcomes, you create this self-improving system that empowers teams and keeps leadership informed about what’s happening on the ground. Outcome-based roadmaps outline sustainable business growth strategies. Where a feature-based approach can only provide lagging indicators, outcomes are the leading index of behavioral change that impacts crucial metrics like new accounts added, increased in-app activity, etc., that can be directly tied to revenue or business growth metrics. Each bet is then a concerted effort to impact these metrics, rather than just to add another feature that may or may not benefit the company or the user. It’s a focus on the quality of the results of precious resources consumed rather than the quantitative output of those resources, and it can make all the difference in increasingly competitive markets for businesses wondering how to gain a competitive advantage.
4 Strategies for Aligning Your Business Around an Outcome-Based Roadmap
I’m sorry to say it, but to get to this outcome-based future, you’ll need to build a completely new roadmap. This might sound difficult, especially for established businesses, but rethinking your feature-based roadmap is a worthy endeavor that will pay off tenfold. Here are some ways to create key elements of your outcome-based roadmap:
1. Gather a variety of inputs to hone your understanding of outcomes.
The first step is to build a better understanding of the problems you’re trying to solve and the expected results of your proposed solutions. To do this, gather all the information at your disposal. From canvases to interviews, data, and research, you’ll need anything that can help you uncover what matters to the business and customers to articulate intended outcomes. Typically, this involves engaging with sales, marketing and PR, customers, operations, executive leadership teams, finance, and even external vendors or partners to understand what’s most important to them.
When it comes to mature products, another great tool to use to discover outcomes is the business model canvas. This tool encourages teams to break down the company into its key areas of business, such as customer segments, revenue streams, and operations. It helps teams quickly align around a shared understanding of what matters most to the business using a method that doesn’t require a business degree to understand.
For startups or brand-new products, another tool we like to use is the Lean Canvas model, which can help you quickly identify unmet customer needs with real business value to pursue. Together, these tools act as ways to jump-start your strategy, which is built upon your roadmap.
2. Create a memorable elevator pitch that articulates your product vision.
To create change, you need to unify your organization by declaring a shared purpose. If you look at the most successful companies in the world, such as Apple ("To make the best products on earth and to leave the world better than we found it."), Amazon ("To be earth's most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online."), and Disney ("To be one of the world's leading producers and providers of entertainment and information."), they all have succinct, coherent product vision statements that offer a visible direction for their business that rallies the organization behind it.
To craft an inspiring outcome roadmap, you need to be able to clearly and concisely communicate what your products do and, more importantly, why they exist. If someone were handed your roadmap and had to take away one thing that they then used to champion the vision on your behalf, what would this need to say?
A great starting point is to use a Mad Lib-style format and build off the following framework with your own context:
For [target customer] who has [need statement], [product] is a [market category] that [key benefit statement/value proposition]. Unlike [primary competitor alternatives], the product [statement of differentiation].
This simple statement can be the most challenging place to start, but it helps the team articulate a clear understanding of the problem we’re seeking to solve and what the world looks like when we’ve achieved it. If we can’t quickly and clearly relate a customer problem to a solution, why would we invest in solving it?
This is the guiding star for your roadmap: All your other efforts will fall into place under it.
3. Implement a system for setting and tracking objectives and performance.
For your roadmap to accurately reflect your vision, you need a bridge that connects business outcomes with measurable product metrics to guide empowered teams with data. This bridge looks like a metrics-driven strategic goal-setting framework that enables you to identify the specific objectives and key indicators where you would need to see change in order for your business to achieve its vision.
While there are numerous ways to build this framework, a simple and powerful solution is to use objectives and key results (OKRs) to create an implementation plan for reaching your vision. For each goal you have, you identify no more than three to five key results you’ll use to measure your progress toward reaching it. For an online subscription business, we may have revenue targets as a business comprising key indicators of revenue potential such as page visits, free-trial signups, conversions, renewals, daily active usage, repeat use over time, or referrals to friends and family.
Choosing a set of metrics to aim to improve—such as increasing renewals or reducing churn—from a baseline to a new target over a certain period and then letting teams dictate how they plan to accomplish those goals is at the root of the OKR framework. Teams with baseline measures then report to management on a regular cadence how they’re doing against this metric.
The real discipline is in revisiting and reviewing these OKRs regularly. This helps you evaluate the specific bets on the roadmap against what is most likely to impact our OKRs and prioritize what makes it on the roadmap at all. Is a metric improving consistently above goals? Set a new target or focus on a new, bigger problem instead. Is an OKR continually unchanged due to constraints on the team? Consider whether it’s worth tracking at all. Or, if it’s very important, consider reprioritizing other tasks to increase focus on the target metric.
4. Start talking to customers, and never stop.
One of the best ways to achieve a sustainable competitive advantage in the modern economy is to prioritize the customer experience. Eighty-four percent of businesses that try to improve the experience of their customers end up with increased revenue. As such, no successful outcome-based roadmap is complete if it fails to address the needs of the customer. We promise, there’s no greater return to the business than what can happen when you have a direct quote from a customer expressing a problem that the roadmap intends to solve.
Communicating directly with customers is the only way to find out what they’re looking for in your products and why. Making a habit as an organization to have a continuous exchange with customers is the key to keeping your roadmap dynamic and relevant.
Topics, trends, and opportunities uncovered through conversations or exchanges with customers can form your opportunity solution tree, which can help you visualize the entire customer development process, from problem identification to solution to outcome. This format lets you categorize customer feedback into themes and align them with the ideas and opportunities that will help you best address those needs and reach the business outcomes feeding your outcome-based roadmap.
The development and maintenance of an outcome-based roadmap may seem like a lot of work. It can be. But that work will improve team coordination, make it easier for leadership to track the success of each new product or feature, and make it easier for businesses to adapt to any changes in the market that come their way. We have to look before we leap, even in product development. A modern economy calls for a modern way to do business, and that means focusing on what really matters: outcomes.
To learn how Synapse Studios has helped clients develop successful roadmaps, reach out today.