Behind Every Great Product by Marty Cagan

[Music] [Applause] thanks i do martin knows i love this conference i really do feel it sounds corny but it does feel like this is my tribe and i just love hanging out with this group and i know fortunately many of you um martin was saying he's been in this business 20 years and i'm you know that's supposed to sound impressive but um i sort of gonna admit to you that last month i celebrated 35 years of working exclusively with tech product teams so i don't know there's that many people in the room who can say that if there are i actually love to meet you in the break but but actually i i'm gonna take advantage of that today because one of the things i've had is i've had a chance to work with a lot of pretty amazing product teams that's been my sort of unfair advantage getting sort of access to so many amazing product teams and i thought i should use that and um so that's really where this comes from and i'm pretty excited actually about this talk i've never given it before because i'm going to take a very different approach because look in truth i've tried for years to write and coach and teach about the role of product uh and you know if you judge it objectively from all the confusion out there i haven't been all that successful it's um it's it's confusing i don't know how many you remember or have read uh if not please read it tomorrow ben horowitz years ago actually about more than 20 years ago now wrote a paper called good product manager bad product manager if you haven't read it it is honestly i had it taped to my desk and i worked with ben and i remember every month or so i would force myself to read it and be very critical of myself and what i needed to improve i mean it's it's very short and sweet and if you know ben that is very much ben is very right to the point very harsh but um ben made a big impact on me that made a big impact on me i had a lot of thoughts about product after i left ebay and i actually decided to write a paper which was really because that good product manager bad product manager didn't really say a lot about how to really do that job it just says good ones do this bad ones do this and so i um i wrote a paper called behind every great product it was kind of my first debut into sort of the blogging scene as a product person and it was pretty well received it talked a lot about the role but we are 10 years later we're actually more than that more than a decade later and i'd like to revisit that really revisit that and there are three reasons that i want to revisit this topic the first one is there's no question confusion remains in a big way all you have to do is read you know any of the the aggregation blogs that come around you'll see all kinds of stuff you know it's amazing to me a new product person must be so confused now part of that i mean there's a lot of forces at play there part of it i think is honestly due to something i'm actually a big fan of which is the move to agile but one of the consequences is countless product managers think their job is a product owner and that is like right off the bat that that's screwing things up left and right second um look it's the internet you can't stop donald trump from writing whatever the heck he wants you can't stop anybody from writing whatever they think about product and so it just creates a lot of noise it's really hard i think for people so there's no question there's a lot of confusion and i wanted to do honestly my best shot at trying to clean up this confusion once and for all i think it's too important as you'll see another big difference is since i wrote that i have learned a lot mostly because i've gained entrance to a lot more teams than i that i had even before and so i wanted to take advantage of that not just learned a lot but i've also met a lot of great product people you can over time you can start to really see the difference the essence of what makes a great product person versus most and the third reason and and this is contrary to some of the what some people think at least online uh i would argue that the role one of the things that has really changed is the role is now even more important than it ever was even more important and i hope to convince you of that so my what really hasn't changed though is my belief is that behind every great product there is always somebody they don't always have the title product manager but they usually do but there's always somebody behind the scenes working like crazy to solve incredibly hard problems to make that product succeed just always and most of the time we have no idea who that person is we might know the founder gets all the press but we rarely know that product person because essentially there's three ways i see teams run product managers working be real here the first way is basically anytime a decision comes up they escalate it to the manager to a ceo so they don't make any decisions they're just always going on to me i refer to this person as the backlog administrator that's their job they're taking care of the backlog if you think the job of product manager is as taught in a certified scrum product owner class this is probably you okay now don't get me wrong product manager needs to also be the product owner but that's like saying i don't know it's like saying i know how to use microsoft excel so i'm a product manager that's not it's just one of the minor things actually that we do all right that's one way of working the second way of working is instead of escalating everything the boss you've seen this the product manager decides whenever there's a decision let's call a meeting and they invite all the stakeholders and you have a big room full of people and you figure lets them argue hash it out i call those people roadmap administrators that's basically what they're doing this is basically designed by committee you almost never get anything beyond mediocrity in that way of working besides being completely demoralizing way of working and then there's this third way which is actually i would argue the product manager doing his or her job and so what i really want to do is talk about this third way but i you know i'm not gonna do it like i usually do it which is to kind of lecture about the responsibilities and the traits behaviors of good product people instead i am going to pick i picked six products six products by the way intentionally that are iconic products every one of you in this beautiful room knows and loves these products you probably love it but you certainly know it every one of you but i would also wager that probably none of you can name a single one of the origin the original product managers or the core product managers but in their pivotal points and and that's not that's normal but it's a shame and it kind of bothers me especially for this tribe i was thinking you know if there if there was a hall of fame for product managers i'm going to show you six absolute members and i not only do i want to introduce you to these six but i want to show you i want to share with you the back story that you know this never gets talked about in the press i want to share with you the back story of really what made that product happen so um and i'm hoping those six examples kind of show you a different way a more maybe visceral way of understanding what the essence of this role is so let me start by introducing you to martinezco and of course one of the most successful products in history word um the year was 1993 that's not actually when word was invented because of course but uh martina what happened in 93 is microsoft was working on the biggest release ever of word it was actually 6.0 at the time and the big thing about 6.0 is what's not remember back in the upgrade model you kind of had to add a bunch more features to get people to pay the money to upgrade well that's how it was and this was the one that was going to make them a ton of money and also they had a huge goal besides all these new features they had a huge goal which was at this point they were supporting three platforms windows dos in the mac and those code bases had diverged and so one of the things that was just driving the team nuts was it was taking forever to get a release out because they believed they had to release simultaneously and these are three completely different code bases so big goal honestly the big goal of 6.0 wasn't the marketing pitch about all the features it was we're going to move to a common code base and of course because of that not only is that hard but it also put a lot of pressure to get that release out because they they needed to get the the velocity improvements that come from a common code base there was a lot of pressure to get that thing out and they did they shipped it was word 6.0 marketed as the most full-featured version of word for windows and mac and on the mac it literally crawled i'm not exaggerating here it literally took two minutes to start up okay people you know what happened actually on the boards people started claiming that microsoft was doing this to kill the mac no literally they thought this was their strategy to kill the mac and in fact hate mail started coming all over to microsoft including directly to bill gates with messages like well sorry they were complaining bill gates he started forwarding these messages onto the team saying things like this is depressing microsoft stock price fix it and so you've got this young product manager out of stanford martina and they say can you tackle this and she's now responsible for word for mac and so the first thing they did is the first thing they did is sort of figure out where they were and where they were is they had just released a terrible product and they knew it so they got to work they got to work and they looked actually they they realized of course that having a common code base is great unless it results in a terrible product and that's an empty victory more important mac customers needed a mac solution they also really deeply realized at this point that people buy a platform because of what's different not what's the same users didn't care that it worked the same way on windows they would have much rather had it work well on a mac so they got to work they did well of course they did a ton of performance work they also worked on fonts because fonts are actually used a lot more on a mac than they were on a pc they also worked on things like keyboard shortcuts so that mac users were comfortable oh they also um what else did they do oh one of the things the press was constantly doing is running word count because they actually use that as their benchmark for performance so they not only made word count work reasonably but they actually made it work better than it does on the pc anyway they did all this work and about three months later they released word 6.1 for the mac tellingly everyone they shipped a version of 6.1 to every registered user on a mac accompanied by a letter personally signed by martina apologizing for the release okay think about that and not only did this work of course it was a reset the perceptions and okay it's a it's a good product well not only did it work uh but and now by the way this is the first release the mac team felt good about like they felt like they should have released this in the first place but what's really remarkable is this caused microsoft to do a hundred and eighty degree change on their strategy they actually realized that they needed to not only diverge but they needed to really build a business unit around the mac you know the mac community was it wasn't i should have mentioned you know back then at 6-0 release the mac version was like 60 million in revenue and the windows version was a billion in revenue so it's pretty small but they also it's a vocal community and you know the other thing is that community on the mac didn't have a lot of love for microsoft so strategically they made a big change focused on mac as a business unit and you know it's almost impossible to talk to really even estimate how big a difference this made to our world not only did this generate billions for microsoft look even today more than 20 years later millions of people around the world consider word and office critical to doing their personal and business work on a mac and yeah we all know like you saw martin's list apple's at the top would they be for sure if they didn't have the software that they needed i'm not sure huge impact that's impact i mean to me there's a lot of points about that team but to me the strongest point is you know people talk about doing the right thing for the customer all the time but it's lip service martina knew what they had to do for the customer and even though that changed major chat strategy major technology approach they did the right thing for the customer and it really did change the course of both microsoft and apple's history martina actually went on i first met her actually after that when she came to netscape she ran marketing for the netscape browser she was actually worked for ben horowitz running marketing at the first cloud computing company and then she happy to say she became my partner at svpg for more than ten years she also teaches marketing at berkeley and the other thing about martina i will tell you if you ever are lucky enough to have a marketing person that's great at product your life is terrific so that's martina let me tell you about another company honestly one of my favorite companies in the world i'd adore well i do adore netflix as a product but i really adore the company the culture their product prowess is amazing love netflix but back in 1999 they were less than 20 people and they were just about to go out of business a lot of people don't know the interesting story for them they were about to go to business their competitor was blockbuster and blockbuster you know had video stores all over the place and uh and they basically started out by having uh it was really just an online version of blockbuster you would rent the movie it would be shipped through the postal service to your house and you'd watch the movie and put it back in the mail and it go back they they got up to about 300 000 users which basically there's early adopters which are always there and there were some people in the u.s that lived in little towns that didn't actually have a video store so okay it's kind of useful for them but they were stuck at 300 000 users and worse they weren't making money it's uh it was a so they were kind of they knew something had to change they knew kate was the product manager kate arnold of this small team and uh while they knew they had to do something different they weren't sure what they were on a whole bunch of experiments one of the things they tried was what if we were to change the model so that you could get a subscription for a month and then you got all the movies you want and it's an easy test to do they did that test no surprise great news was yeah actually people said i love that a month all i want low price let's do it that was good and a lot of people think that was the innovation that wasn't the innovation that was actually the easy part hard part is they just created a mess for themselves they created some really hard product challenges because no surprise everybody wants to rent the new release movies but in that world in that business it costs way more for them to stock a new release movie than it is to stock a classic right an old movie and if everybody's trying to rant new movies they basically go bankrupt really fast so all right they said okay we have to do something we have to figure out a way to make that business model work this is actually where the technology-powered innovations came from this is where they came up with the queuing system the rating system the recommendations engine because they knew they needed to make customers love their movies but end up at the end of a month with a mix of new stuff and older stuff now that's a hard product challenge a lot of companies probably would have wouldn't have done it they figured that out they got to work they figured that out and actually what was amazing to me is a few months later they released with a whole redesign netflix with the rating system with the queue with recommendations with an all new billing system technically that's not quite true they this was pretty funny they actually realized um they released that without a billing system because they realized they had a one month free trial which bought them an extra 30 days luckily but of course this is what powered netflix for the next seven years next seven years and uh and of course then to netflix's credit they they disrupted themselves again by moving aggressively to the streaming model but this is to me just think about this by the way during these months as you're figuring out this new system uh kate was saying that the stand-ups basically had almost everybody at the company she's working with the founders they had a now legendary co-founder reed hastings um on the strategy she's working with the customers users on validating product ideas she's working with the analytics every day she's working with the designers and the engineers to design and implement these capabilities like the recommendation engine she's working with marketing on this new acquisition model she's working with finance on the new business model and billing she's working on with the warehouse on the whole fulfillment logistics issues she's working with industry people because by the way while all this is going on there's a backlash in hollywood against this whole thing imagine her life i mean that is brutal but it happens now nobody knows kate's name but it happened and i argue yeah and by the way kate credits some amazing engineers she's a huge fan of boy co-founders had a lot of courage and insight for that but i argue netflix doesn't happen without a kate this is a big deal okay everybody knows adwords everybody does what you might not all know is that last year i mean adwords actually was created in 2000 it's 16 years old but last year alone adwords generated more than 50 billion dollars in cash so think about that for a second and ask what you've done lately of course it's amazing been an amazing success sort of it's definitely a hall of fame kind of product but again nobody knows jane most people never heard the name but jane was asked to be product manager for this new effort because frankly it couldn't get off the ground it actually the core idea behind adwords had support from larry page but there was huge resistance legitimate huge resistance from the two biggest constituencies at google engineering why engineering resistance because they work like crazy every almost everybody there at the time working like crazy to provide relevant results so advertising that freaked a lot of people out remember the whole do no evil thing that was thrown at her a lot um and then the other huge resistance was sales because you know they were trying to make some money and they had brought on omid kordestani who ran sales and they were actually off to a this part of what made it hard they were off to a great start because they were selling keywords to big brands and showing them as uh highlighted search results at the top of the results by the way just like omid did at netscape where he came from just like several other companies did and they were starting to make some real money because google's works well so it makes it pretty appealing so and of course the sales people were nervous legitimately about well we call this cannibalization they're like why do people you know why should we do that we're trying we're selling this for big money up here so james asked to come in here it's like amazing to me this 50 billion dollar product last year how close it came to never being built very in fact most companies i know would not have built it so why well so jane had to uh shane had to figure this out so she sat down with everybody she sat down with engineers and talked to them about what was the real issue there and of course they she understood part of it was worried about relevance of results part of it is a lot of nervousness about advertising looking at a lot of companies like yahoo and others and not wanting to go there so and they felt a lot of pride in their uh in their technology and so she worked with them to uh because then she also shared with them why this is important because most of them didn't understand why this is important she made the case for the small business owner there's no way they're going to get results either through a mead's team because they could never afford it or even through sc seo because they're a little guy they're never going to come up as high and so she made the case for that she made the case for self-service and with sales of course they were worried about cannibalism cannibalization so she understood that so she got to work and the other thing she did really well is she she went to one of the most respected engineers at early google george haddique and he went and she went to him and really showed what he wanted she wanted to do and convinced him of its virtue and he helped influence the other engineers and the result was they jane actually wrote the first spec for adwords uh worked with the engineers and designers to build this out as you know it's a pretty complex system and of course it was a radical success once it got out there and it really did change the world and certainly changed google in a big way jane um took a break after that to start a family and now she's back at google actually helping the youtube team terrific terrific product manager uh let me tell you a little bit about alex presland alex i got a soft spot for the bbc admittedly i um and not just because i'm here i've had a chance to be in with the bbc for a long time and i met a lot of really good product people at the bbc uh you know they've been around about 100 years actually and they were pretty early to technology but um alex had just done a product for the bbc which was bbc was one of the first companies to do a um content syndication one of the first to enable that and she had just released that and she realized the potential of this new technology so she started looking around uh england to see where this could be used and in general the bbc could reach people through by the way this was four years before the iphone 2003 yeah 2003 four years before the iphone she started seeing um you know people in their homes and their cars okay they have radios or television but there were lots of places people weren't being reached one of the venues she noticed was city center venues that basically had these big video screens but she noticed they were just playing they were just playing what's on tv and so she realized it gave her an idea so she proposed a series of experiments where she had an editorial team create custom content and then she measured the audience reach and engagement of that and which of course sounds kind of basic but the truth was this was a radical departure for the bbc because they were a broadcast culture and this idea of content distribution was a very different thing so actually because these results went well she proposed a new strategy to the bbc by the way she's an independent individual contributor she does this she proposes a strategy called bbc out of home on how to reach people when they're not at their tv or radio that strategy became the mobile strategy but she uh she had some big obstacles that is not an easy institution to change many of you know that personally and she two big areas editorial which was really used to again that they're used to creating content and in control of how it was going to be presented to the audience and now they're talking no no you're going to just do the content we're going to distribute it many different ways it's freaked out a lot of editors and then and she had to convince people is not only good for the bbc it's really good for the audience which is a big part of their mission uh she also ran into big obstacles from ligo can you legal can you imagine all the license agreements having to be renegotiated because of all these ip devices anyway uh pushed through all this and it did become the mobile strategy today more than 50 million people every week use the bbc mobile products alex actually had a great career um running product and tech team she now runs product in new york city for bower excel to be honest what this was not just a story of technology-enabled solutions it's also a story about force of will if you know alex she's a force of nature and this is what was necessary to make that happen let me tell you about camille camille hurst she was lucky enough to sort of go through her formative years in product at apple on the itunes team you know in truth apple when they first started itunes it wasn't a big success but it was a necessary part of their strategy because you know the industry was not cooperative and the basically the way they got any kind of agreement was to do a drm based solution which kind of made the industry okay but users didn't like it so uh but that wasn't actually when camille got engaged she got engaged when uh itunes really came into its own which was when they moved to non-drm and camille got to work on lots of efforts there in fact i had to work to figure out which was the most interesting to talk about but one i loved which was you guys might have heard of this show american idol yeah i think they might have had a knockoff of it here but uh idol was a big thing back in 2008 when this was going on this was a big thing in the u.s 25 million people watched idle twice a week with pretty much unheard of engagement numbers and apple's looking at this you know because when itunes was trying to go mass market there's product work there's marketing work and there's a lot of stuff that's a blend of product and marketing but it's hard for any product to get mass market and this was a tough one and anyway eddie q who ran itunes worked out a deal with the idol producers because it's kind of obvious that is a pretty great target market for apple items the idol crowd pretty great and so they um they worked out a deal that let them uh to do a bunch of integrations and really tie this in well um the the assignment for camille was we want um we want to target the idle persona but we want to make itunes part of the daily life of these idol fans and uh the problem was uh forex i mean there's always this this kind of stuff is always hard especially with a partner especially in the media industry anyway an example was idle is all about voting right it's all about voting and unfortunately uh itunes was all about uh trending music so if you think about it that's like a predictive market and so if they show the sales of contestant song who wants to turn in to see who's eliminated because you can pretty much tell who's going to be eliminated so they had to really change itunes in significant ways so that it didn't disrupt and basically make the producers all unhappy and and make that work and kind of come up with that compliment and long story short they did that they they came up with great solutions led to a 20 billion dollar business another great product manager and to me what was really impressive to me about camille's work is all the normal challenges big companies but they had to really be creative in coming up with solutions that worked for both idle as a business and apple as a business and was loved by this new target market all right so far all the people i've told you about just to point out they are all individual contributors no directors no vps these are individual contributors product managers doing what product is supposed to do and in truth most of the time if you've got a great product team with a great product manager they can do great things especially in a startup mid-sized company but it's also fair to say in big companies a lot of times you need more and this is an example of that leah was at this point in her career a product leader she was leading product for the creative suite at adobe over several years she had built this up to a two billion dollar license revenue business which is amazing and by the way that was roughly half of adobe's four billion dollars a year so this is the big money making part of adobe however this was installed software the creative suite was installed software desktop software on the upgrade model and leah knew that the upgrade model was pushing people into directions that weren't really good for adobe customers and also weren't really good for adobe because of that and so she realized what we they needed to do was move to basically software as a service the cloud as a service actually became known as the creative cloud but that's realize this this is two billion dollars of a four billion dollar revenue company every single bone and muscle in the adobe corporate body is trying to protect that revenue and changing a company from a licensed model to a recurring revenue model is wickedly hard changing anything but this especially just i mean we could talk for an hour just on the challenges there imagine how finance felt about moving and they're a public company and talking to the street about big changes that are coming and why and how about our engineers were freaking out because they were on an 18-month release cycle and all of a sudden they're being asked to move to continuous deployment uh and to they were also realizing you know nice thing about installed software is if there's a big bug the customer doesn't have to install it that's not the way it is for our services today and so they're like well we have to keep this running all the time seven by 24. um so they were freaking out and by the way not if that's not enough adobe made their money through uh go to market strategy of channels you would buy it from other stores including amazon's and everywhere else so you could be and that so their model to sell was through a channel model and this meant adobe was going to have to have a direct relationship with their customers which on one side people are like yeah that's good but like the sales people which not only their jobs were threatened but they were also saying you know if we screw this up the channels will probably not be very forgiving so literally they were betting their company and so leah knew and by the way it's even worse than that because the creative suite as the name implies is not just one product it's a suite of 15 major products plus lots of utilities that all have to be deeply integrated so leah is in charge of this thing and has to convince the whole company basically to move to an entire different way of working way of thinking and way a relationship with our their customers and so she first thing she did she teamed up with the cto or their then cto which was kevin lynch they created some great prototypes that really showed the power of what they could do supporting all these different devices and how it could be a much better world for the designers that depend on them and they use that to kind of get support from executives from teams and then to be honest leah started probably one of the most sustained brutal campaigns i've ever seen she had to constantly well she articulated the vision and the strategy to everybody but she had to talk to executives constantly sales marketing finance legal engineering design everywhere to get them and keep them on board to get that thing out and she did they got this out they went from a million users of to of the uh the creative suite which was pretty awesome to six million users of the creative cloud they were the fastest company to a billion dollars in recovering revenue which by the way is incredibly hard to do they tripled the market cap of the company to it's a 50 billion dollar company now but nobody knows leah's name but of course there were hundreds probably thousands of people that really contributed to that but i argue it needed aaliyah okay so there's five big things i'm hoping you take away from this i wish i could talk about more that was as much as i thought i could fit the amazing thing is i actually know lots more stories like this great product people behind iconic products but first hopefully this start this makes clear i genuinely hope that product role is the product manager is not to be confused with any other roles in the team i'm hoping it's blatantly obvious why this is nothing to do with the product designer we love designers this is not the same role and i hope we can stop having those ridiculous discussions about role conflict between design and product every time i've ever had the discussion i'm talking with somebody that has no clue about products i also hope we could stop having the ridiculous discussion about product versus project management this is not a project management job now the truth is every product manager does some amount of project management of course if you think about it every leader in the company your vp of technology you're vp of uh marketing every leader has to do some project management some cat hurting and force and push things along we all do but to con to think this job is essentially a project manager is to miss the point of this job now the truth is there is one role that this job is really similar to in very important ways which is the ceo now we used to talk a lot more about product being the ceo uh ceo of the product but you know it kind of went out of vogue because there's a obvious difference nobody's the boss the product manager is not the boss of anyone but the ceo kind of is the boss of anyone everyone however if you think about it the good ceos they all know that they need teams of missionaries not teams of mercenaries and so the good ceos even though they are the boss they still know they have to persuade the team they don't want the team to build something just because they say so they want them to build it because they believe so that's the heart of this role so it's not like the other disciplines and this is what the ceos need second you can't do this job without a good broad understanding of business like a ceo you have to understand marketing sales legal partnerships manufacturing all the different parts of the business in order to solve that problem if you don't understand that you're going to have to go back again to escalating all the decisions or meetings again so you've got to understand all aspects of business by the way that doesn't mean you need to be an mba as a matter of fact none of the six product managers i just showed you have an mba i don't have an mba that doesn't mean if you have an mba you're not allowed to be a product person it just means that's not what it's about all right and i know it's flashing at me but just a couple more points um i hope you noticed that not one of those iconic products not one of them did the product actually come from users or from sales as in the cases almost all the time with amazing products successful products the product actually comes from an intense collaboration with design and engineering to solve real problems for our customers in ways that also work for our business that's what it's about it's about these technology-powered solutions that's why product people have to be they have to sort of wrap their arms around their whole part of their product and business i hope you also notice that these people are like a good ceo by the way they are the best in the best sense smart smart because they're like applying technologies to solve real problems creative i hope you noticed so many of them were thinking out of the product box not just like what feature do we add they were actually looking at how can we solve this with the assets we have and persistent there's just no way you know in all those examples especially like adwords a great example of why a product that had many reasons not to get built there are always many good reasons for a product not to get built the successful products have somebody that get over each and every one of those objections like jane did sitting down with engineers and sales people all right and the last point is i hope you notice even though a product manager is generally an individual contributor they're leaders in the best and most meaningful sense of the word and the i want to point out to you then of course they're leading through their inspiration through their motivations through their logic but what i want to point out to you is is uh if you want to be a great product manager don't be afraid to lead okay those are the five big takeaways actually there's one other takeaway i'd love for you to get but i'll let you figure that out on your own all right thank you very much [Applause] you

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Length: 44min 2sec (2642 seconds)

Published: Wed Jun 16 2021