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By Hari Harikrishnan – Chief Product Officer, The Cerebrus Group
Understanding the broader context surrounding a product is crucial. This context significantly influences the decisions made regarding the product, whether they are current or future decisions. Today, the flexibility in shaping a product is vast. Thus, considering these broader contexts and dimensions, which might not be part of the daily routine, becomes essential. This comprehensive approach is referred to as “beyond product.” It’s about expanding perspectives and incorporating various factors that can affect a product. Key areas of focus are growth, innovation, and disruption.
These frameworks will enable you to:
By exploring these areas, you’ll gain insights into how to position your product in a dynamic market. This strategic approach will help you stay ahead of trends, adapt to changes, and drive sustained growth and innovation.
Businesses are eager to figure out how to grow, innovate, and avoid disruption. The frameworks discussed here are tools to help think about these aspects effectively. Everyone is eager to figure out how to grow, innovate, and avoid disruption. The frameworks we’ll discuss today are tools to help you think about these aspects effectively.
To understand how product and service conversations fit into the overall business context, it is essential to recognize the mission and purpose driving each business or business division. Every organization operates with a clear mission, which serves as the foundation for productizing offers and developing services.
This broader mission influences critical decisions regarding what to build, what to sell, and the methods employed in these processes. The key areas driving these decisions are:
These aspects are crucial for making both strategic and short-term product decisions, impacting actions on a quarter-to-quarter and month-to-month basis. When prioritizing features, these elements—why, what, and how—must be kept in mind to align product development with the organization’s core mission and objectives.
By maintaining this alignment, businesses can ensure that their product decisions support their overarching goals, leading to more cohesive and effective strategies.
The concept of the “thing” life cycle broadens the traditional understanding of product life cycles. In this framework, a “thing” can be anything from a tangible product like a robot or a coffee cup to an intangible service or software.
Traditional Product Life Cycle
Traditionally, the product life cycle has been viewed as a series of stages from introduction to growth, maturity, and decline. Businesses manage multiple products through these stages, planning for new products or extensions to maintain innovation and revenue growth. This approach involves juggling various products at different life cycle stages to optimize the product mix and revenue.
The “Thing” Life Cycle
The “thing” life cycle provides a more granular perspective. It focuses on the journey of a product from design and development to procurement and use. This approach applies to both tangible hardware and intangible software products. The stages of this life cycle include:
1. Design and Development: Whether it’s hardware like computers and phones or software, every product starts with a design and development phase. For hardware, this includes manufacturing; for software, it involves development.
2. Procurement by the Buyer: Once developed, the product is procured by a buyer. This stage varies depending on whether the product is bought outright or acquired through a subscription model.
3. Use: After procurement, the product is used by the buyer. This use phase can differ significantly between hardware and software, particularly in terms of connectivity and ongoing maintenance.
Distinguishing Product and Asset Life Cycles
While businesses focus on the product and thing life cycles, buyers often view products as assets that need to be managed throughout their life cycle. This perspective highlights the importance of considering how products are perceived and utilized by end-users.
Examples Across Industries
1. Hardware: Hardware products, such as blood pressure monitors, have evolved from unconnected devices to smart, connected devices, especially in consumer and industrial markets.
2. Software: Software has transitioned from standalone applications to connected, cloud-based models, changing how software is consumed and maintained.
3. Healthcare: Products and services in healthcare, such as monitoring devices and healthcare services, follow similar life cycles but are adapted to the specific needs of the industry.
4. Professional Services: Services such as building implementation and management also follow a life cycle from design to delivery and maintenance.
Impact of Digital Transformation
The digital age has significantly altered the life cycles of products. Materials-based products now incorporate smart technology and connectivity. Electronic and industrial manufacturing processes have merged, and software designed for managing hardware has become essential. These changes require a shift in how products are designed, manufactured, procured, and used.
Design for Use and Procurement: Design thinking has become crucial, focusing on rethinking product usage and operations. Additionally, designing for procurement, especially in subscription and on-demand models, requires careful consideration.
By understanding and applying the “thing” life cycle framework, businesses can better manage the evolution of their products and services, ensuring they meet the needs of both the market and the end-users effectively.
Consumption involves the use of products or services, ranging from software to everyday items like drinking water and reading books. In the industry, consumption, and business models are often discussed, but the focus here is on breaking down the dimensions of consumption to understand what drives it.
Examples of Consumption Evolution
Water:
-Dig a Well: Do-it-yourself water collection.
-Commercial Bottled Water: Purchase off the shelf.
-Tap Water: Direct, convenient consumption at home.
Books:
-Physical Book: Traditional printed format.
-E-Book: Digital format for reading on devices.
-Audiobook: Subscription-based service where books are read aloud.
These examples highlight how both the form factor and the consumption model evolve together. When thinking about products, consider the form factor and the consumption model as interconnected elements.
Dimensions of Consumption
Consumption can be broken down into four key dimensions:
Transportation Industry Example
The transportation industry exemplifies these dimensions:
These scenarios illustrate how different combinations of mode, ownership, operations, and payment create various consumption models.
Technology Products Example
Smartphones:
Technology Services:
Cross-Industry Patterns
Across industries, similar consumption patterns emerge. Consider how different consumption models can impact a business:
Impact on Business Models
Businesses must understand their consumption models and those of their partners and competitors. For instance, product makers often sell to other product makers or service providers, who then sell to end customers. Recognizing where a business fits in this value chain and adapting consumption models accordingly is crucial for innovation and competitiveness.
In digital business, understanding the intricate dimensions of your product or service is crucial. The concept of Business DNA, particularly Digital Business DNA, offers a powerful analytical framework to navigate this complexity. This framework encompasses various dimensions that help businesses plan, innovate, and avoid disruption.
Key Dimensions of Business DNA
1. Offer Form Factor:
2. Monetization Models:
3. Ecosystem Leverage:
4. Technology and Assets:
Understanding the Framework
Traditional vs. Digital Business Models:
Ecosystem Orchestration:
Analyzing Business DNA:
Practical Application of the Framework
Example: Automotive Industry:
Example: Technology Products:
Key Takeaways
1. Consumption Models Drive Innovation:
Understanding consumer expectations and preferences is crucial for innovation. The job to be done remains the same, but how it’s achieved can vary widely.
2. Rethink Life Cycles:
Whether dealing with products, services, software, or hardware, reconsidering the life cycle in the context of modern consumption models is essential.
3. Integrate Business DNA:
Combining consumption models, productization plans, and ecosystem leverage creates a holistic view. This helps in determining the necessary transformations for staying competitive.
4. Assess Disruption Potential:
Regularly analyzing whether your business can be disrupted by new entrants helps in stay ahead. This involves looking beyond the immediate product to the broader digital landscape.
By understanding and applying these frameworks, businesses can better manage the evolution of their products and services, ensuring they meet the needs of both the market and the end-users effectively. Aligning product decisions with the organization’s mission, embracing the “thing” life cycle, adapting consumption models, leveraging ecosystem resources, and analyzing Business DNA are essential strategies for thriving today. These frameworks not only help in handling current challenges but also in anticipating and preparing for future disruptions, ensuring sustainable growth and innovation.
About the Author:
Hari Harikrishnan – Chief Product Officer, The Cerebrus Group
A product framework is a strategic tool that helps businesses understand and manage the lifecycle and dimensions of their products and services. It encompasses various elements such as design, development, procurement, use, monetization models, and ecosystem leverage, guiding decision-making and aligning product strategies with the organization’s mission and market needs.
To build a product framework, start by identifying the key dimensions relevant to your product, such as design, development, procurement, and use. Incorporate monetization models, from transactions to subscriptions, and consider how to leverage internal and external ecosystems. Ensure the framework aligns with your business mission and market needs, enabling effective product management and strategic decision-making.
A product design framework is a structured approach used to guide the creation and development of products. It encompasses various aspects such as user research, ideation, prototyping, and testing, aimed at ensuring the product meets user needs and achieves business objectives. By following a product design framework, teams can systematically iterate and refine product concepts, resulting in more successful and user-centered products.
A product strategy framework outlines the key elements and approaches involved in developing and managing a product portfolio to achieve business goals. It typically includes components such as market analysis, customer segmentation, competitive positioning, and roadmap planning. By using a product strategy framework, organizations can align their product development efforts with overall business objectives, ensuring sustainable growth and competitiveness in the market.
