Your product management maturity model isn’t so much about what your team can do. It’s what your team can do for the customer.
From either perspective, it’s the skill level and proficiency of your team as it matures. But if customer value is always the end game, make quantifiable customer outcomes the driving force in your product management maturity model and the path becomes shorter, faster and easier to measure.
Here’s the simple way to break it down.
The Product Management Maturity Model: 3 Tiers of Customer Value
Tier 1: User Value
User value is paramount to the success of any product. In B2B though, the value chain goes well beyond the user. Nevertheless, it’s where most product management teams start.
Here’s the most important perspective when it comes to delivering user value. Your solutions have to make users “quantifiably” better at their job in ways that have measurable value to their organization. That means what’s best for the user in many cases, may not be the best or most valuable thing for the customer organization.
As you’re considering new products and enhancements to existing products, the first value test should always be quantifiable impact on the job performance of the users, and the subsequent value to their organization.
Critical versus nice-to-have monikers will be obvious when you look at it from this angle.
Tier 2: Department Value
This is where B2B and B2C product management completely diverge. In a consumer product world, the user and the buyer are usually the same. In B2B, the user and the buyer are rarely the same.
That means the value equation has another layer that many product management teams aren’t built for, and it goes largely ignored.
Here’s the deal. One of the biggest reasons customers buy your solutions is to eliminate organizational silos that prevent them from serving their customers more seamlessly.
Now, take a hard look at how your product management team is structured.
If you’re like most, you’re operating in silos of your own. It begs the question, how are you going to help customers eliminate their silos if your product teams are working in silos of their own?
The goal here is to deliver solutions that improve cross-functional workflows. For example, consider the workflows that cross marketing, sales and finance, or customer service, shipping and billing, or IT, human resources and all departments.
That means your business requirements efforts have to cast a wider net. Most organizations require an additional role with a new skill set to gather business requirements at this level.
Part of the maturation process means growing your team beyond product managers and product owners. Additional skill sets are required to uncover higher level requirements and drive multi-product/integrated solutions that deliver greater cross-functional value to the customer.
Tier 3: Industry-Specific Value
At the top of your game, you’re delivering solutions with industry-specific functionality that make customers more competitive in their markets.
Instead of delivering a great cloud platform, you’re delivering a cloud platform with capabilities that are specific to banking, healthcare, retail, manufacturing, etc.
While your solutions are still “good” for many other markets, they’re “great” for the vertical markets you’ve identified as your best growth targets.
Differentiation becomes easier now because your relevance quotient is much higher in your chosen markets versus horizontal-only competitors.
Many companies go vertical as their products commoditize. It’s the easiest way to differentiate and not get forced into competing on price.
ROI on The Product Management Maturity Model
In most cases, the more quantifiable the value you’re delivering to customers, the greater the ROI to your organization in terms of revenue, market share and customer retention.
If you’re a reasonably mature company and want to shortcut the process, start with the vertical markets that drive 80% of your current revenue. Determine how much runway remains in each vertical in terms of new accounts + cross-sell/upsell potential in existing accounts. Pick your sweet spots and get rolling.
As always, the hardest part is picking your sweet spots and saying no to anything that’s outside those sweet spots! If you can do it, you’ll reap the rewards of being the best solution for a few markets versus a mediocre solution for many markets.
Want to shortcut your team’s maturity curve? Contact us about an enterprise subscription to Product Management University On Demand or an instructor-led training workshop that’s personalized to your products and your markets. Learn what good looks like for you.