IF ONLY I’D HAD A TARDIS: WHY YOU SHOULDN’T RELY

ON TIME TRAVEL TO MANAGE YOUR PRODUCT FINANCIALS

Amanda RalphHead of Product – Kinetic Super

22 August 2015

#prodmgmt @ralphytown @pcampmelb

A core role of the product manager is VALUE CREATION –value to the customer; value to the business

You must be able to predict (forecast), measure and create value

AS PRODUCT MANAGER YOU NEED TO:

• Know and understand your customer: understand the customer need – the job to be done

• Identify the market opportunity and the business drivers

• Translate those needs into product strategy and requirements

• Develop a business case that defines the expected costs and return on investment

• Test, learn, iterate and take your proposition to market

BUT IT IS NOT JUST A CASE OF ‘BUILD AND SHIP’

YOU NEED TO MEASURE PERFORMANCE

UNDERSTAND YOUR FINANCIALS

• They will help you identify where the opportunity exists to realise benefits and deliver optimal value… at scale

• And to know where problems and threats to your product performance exist….

YOU NEED TO MEASURE PERFORMANCE SO YOU CAN OPTIMISE BUSINESS AND CUSTOMER VALUE

WHAT TO MEASURE?

DEFINING YOUR BUSINESS METRICS

• They must be measurable – you need to be able to track them back to business/value driver

• They must align to your product and business objectives

• They must be actionable – i.e. you have to be able to do something about them; to intervene and make an impact

They will be a combination of numerical business values (within your P & L) as well as more intuitive ‘gut feel’ indicators

• Revenue

• Costs – cost to acquire; cost to serve; cost to retain

• Management expenses (your business overheads)

• Margin – gross and net

• Volumes – number of customers/’widgets’ acquired, lost

• Market share

• Actual versus Forecast – OVER TIME

• Measure of channel effectiveness

• Customer satisfaction

Together, these form your product dashboard

Source: www.medibank.com.au

CORE FINANCIALS

Source: www.medibank.com.au

CORE AND MARKET DATA …

Source: http://www.slideshare.net/saeed_w_khan/product-management-metrics-be-the-product-ceo?next_slideshow=1

SAMPLE DASHBOARD – STATUS AND KEY INSIGHTS

Your dashboard should enable you to understand performance at a ‘snapshot’ and then to drill down in more detail within each measure.

It should be easy to communicate and quickly highlight opportunities and trouble spots

TOOLS OF THE ‘TRADE’ FOR A PRODUCT MANAGER

Product Canvas by Shardul Mehta (The street

smart Product Manager) http://streetsmartproductmanager.com/product-canvas/

Great for identifying on a single page your product strategyand the elements of your proposition that you need to deliver to solve for the job to be done – including core business value and financials

PRODUCT CANVAS

Useful once you have identified the job(s) to be done to focus on core drivers of value across different dimensions of the business – these can then become central to business case and defining measures of success and should be reflected in your product dashboard.

VALUE DRIVER TREES

A FINAL WORD ON WHY YOU SHOULD KNOW YOUR FINANCIALS…

LOOK FAMILIAR?

AS PRODUCT MANAGER YOU NEED TO HAVE EXCEPTIONAL INFLUENCING SKILLS:

• You need to be able to build trust and confidence in your product strategy

• The business needs to get a sense of the degree of business riskand business value that your strategy will deliver

• And they need to be able to understand ‘what success looks like’

In larger corporate environments, you will need to be able to navigate and deliver your product vision confidently to:

• Investment committees

• CFOs

• Actuaries

• The Board

• The Executive Committee

• And any other governance ‘clearing houses’ that your company requires

If you are a start up, you will need to be able to convince:

• Funding partners – investors; crowd sourcing

• Grant committees

• And any other governance ‘clearing houses’ that your start up requires

YOU NEED TO BE THE CONSUMMATE DIPLOMAT –A WELL INFORMED AND KNOWLEDGEABLE ONE

KNOWING YOUR FINANCIALS WILL BUY YOU STAKEHOLDER ‘CAPITAL’ AND CREDIBILITY

WHICH MEANS YOU CAN KEEP DOING WHAT YOU LOVE –DEVELOPING AND MANAGING LEADING PRODUCT PROPOSITIONS

THANK YOU!

aralph@kineticsuper.com.au

+61 429 512 566

au.linkedin.com/in/ralphamanda

@ralphytown