PRODUCTHEAD: ‘Better’ decision making
PRODUCTHEAD is a regular newsletter of product management goodness,
curated by Jock Busuttil.
productdrunk lovesick singalong #
Decisions should be the result of rational and deliberate reasoning, but not all are perfectly rational
Almost every decision has associated downsides or compromises
Avoid trying to please people or to allow individuals to dominate the decision-making process
It’s easy to conflate transparency on the decision-making process, with transparency on the actual decisions
every PRODUCTHEAD edition is online for you to refer back to
Helen and I have started our research interviews for the book we’re writing together. Even this early on in the process, we’re both taking away a ton of insights from our interviewees’ experiences of product management, all of which will inform our writing later on.
If you’d also like to help out, let us know.
Is there such a thing as an obvious technology choice? #
If you work with video software, particularly those based in the cloud, you’ve probably noticed that it has suddenly become a LOT better at audio transcription.
There is a good reason for this. While not all open source software is licensed for free commercial use, OpenAI licensed its Whisper speech recognition model in this way. Whisper may not be 100 percent accurate, but it produces transcriptions that are generally as good, if not better than most companies’ home-grown transcription tech. And it’s pretty straightforward to get running.
Unsurprisingly, it seems that every cloud-based video product has introduced or upgraded their audio transcription feature in short order. Product managers around the world must be over the moon — basically a powerful new addition to their product’s capabilities for minimal engineering investment. In fact, it would seem crazy to persist with the cost, effort and likely lesser ability of any home-grown equivalent.
Despite Whisper seeming like an obvious slam-dunk from the outside, I’m sure there have been some fraught conversations between product managers and their development teams. If it was your team that had been beavering away for years on building a really good automated transcription service, how do you think they’d react if you suggested they switch over to a ‘better’ third-party alternative?
A hungry behemoth #
Back when I was a recently-hatched product manager, I worked at a blue chip megacorp. The development team there had a moderately successful software product in their niche market. It kept track of stuff in warehouses labelled with barcodes.
The company we worked for was a behemoth. At one point it was chomping up and digesting small-ish companies at a rate of two per week for over a year. The megacorp was, however, decidedly not a software company. Whenever it ingested a company with a software platform of its own, the megacorp would promptly eject the software in favour of its existing systems.
Occasionally, an acquired company’s software would be generating sufficient revenue or have high-enough profile customers to prevent this from happening. My warehouse-tracking software team fell into this category. And they gave the megacorp what I can only describe as indigestion. Despite being part of the megacorp for several years before I turned up, my development team and the rest of the organisation seemed to exist in a state of mutual distrust.
At the time it was still a common misconception that a product manager was responsible for ‘build, buy, partner’ decisions. In practice, the average product manager was barely allowed to purchase software licences, let alone to spearhead the acquisition of a company.
So when a senior manager started making overtures to acquire another warehouse-tracking software company, it triggered all sorts of fight and flight responses in the development team — and understandably so.
The IKEA effect #
There’s a cognitive bias called the IKEA effect where we assign disproportionately high value to things we’ve helped create. It comes from a research paper published in 2011 by Michael I. Norton, Daniel Mochon and Dan Ariely. Ariely talks about it more in his book Predictably Irrational.
The IKEA effect means it can be really, really hard to get a team to objectively evaluate a third-party technology alternative to their own product, which they’re naturally biased towards. But even then, nothing will kill a comparison quicker than a lack of specific evaluation criteria.
Which is ‘better’? #
As the only product manager in the vicinity, the senior manager tasked me to compare the two products’ capabilities and figure out which was ‘better’. In my naivety it never crossed my mind to push back a little and ask, better at what, and for whom?
I could give my view of what the two products did similarly and differently at a superficial level, but beyond that I had no criteria for the assessment.
The developers were understandably biased against a thing that had the potential to render them redundant. Some dismissed the competitor’s product out of hand as being of lesser quality than their own product. Some were quite excited and wanted to merge the feature set of the competitor’s product with their own. And the rest were freaked out that they’d suddenly have their own product pulled out from beneath them and would have to start working on this other thing.
A hidden agenda #
The reality was that the acquisition was a vanity project for a senior executive with ‘shiny object syndrome’. He held the sincere hope that he could convince his employer to fund some every expensive CV points. Otherwise the acquisition simply didn’t make sense however you looked at it.
The two products ostensibly did similar things, but they went about it in very different ways, for very different sets of customers, with very different sets of needs.
There was nothing particularly unique or hard to copy about the technology to be acquired or its approach, nor any specific team expertise to be gained.
If the megacorp chose one product and killed off the other, migrating the customers of the discarded product would have been a costly annoyance, and it would probably have lost most of them in the process.
If it kept both products, any revenue gained from the new customers would have been more than offset by the development costs of maintaining both products and the cost of the acquisition itself.
The only real winners would have been the shareholders of the acquired company, who would presumably have been laughing all the way to the bank.
Perhaps unsurprisingly, the acquisition never happened; I think even the senior manager realised his powers of persuasion weren’t sufficient to convince a megacorp with minimal appetite for software to buy a niche software company.
Define ‘better’ #
The main lesson I drew from my megacorp experience was that there is no absolute ‘better’. Without defining any criteria for value, any comparison will simply highlight that two things are different, and nothing more.
If I asked you whether an apple or an orange is better, I wouldn’t be surprised if you give me a confused look in return. However, if I asked you which has more vitamin C, then the selection becomes easier.
In the same way, when we’re faced with any evaluation of alternatives — whether of technology choices, different market tactics, whether or not to fight for something, or whatever — we need criteria. They tell us what actually matters, to whom, and why.
This week, I’ve pulled together some articles on decision making that explore these ideas in greater detail.
Speak to you soon,
what to think about this week
“The only proven way to raise your odds of making a good decision is to learn to use a good decision-making process—one that can get you the best solution with a minimal loss of time, energy, money, and composure.”— John Hammond
[Shane Parrish / Farnam Street]
As individuals, we’re continually evaluating options and taking decisions. As product managers, we have the additional responsibility to balance the often competing needs of users, the business and wider ethical considerations. The decisions we make about our products have the potential to affect a much wider audience for better or worse, to a greater or lesser degree.
[Jock Busuttil / I Manage Products]
I am a big fan of involving the stakeholders and dev teams in important product decisions. But deciding together can be challenging: The most senior stakeholder might try to dictate the decision, the group might shy away from difficult conversations, or people might get stuck in endless debates. This article shares eight practical tips to help you avoid these pitfalls and harness the full power of collaborative decision-making.
[Roman Pichler / Pichler Consulting]
In the swirl of growth, it’s easy to confuse and conflate transparency on the decision making process, with transparency on actual decisions and details.
The Why is scalable because it carries the original intent of our decision, and not just the tactic.
[John Cutler / Medium]
Video games aren’t necessarily everyone’s cup of tea, but some of the most successful games and products share a common attribute: they help the user become more skilled throughout their journey.
[I Manage Products]
I’m currently applying for loads of product manager jobs. I’ve received an offer from a sales-led company where the Product team reports in to Sales. Should I take the job?
[I Manage Products]
Years ago, someone once told me that “perception is reality” when it comes to reputation at work. Of all the lessons I’ve learned in my career, this has been by far one of the hardest.
[I Manage Products]
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PRODUCTHEAD is a newsletter for product people of all varieties, and is lovingly crafted from red and gold découpage paper.
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The Practitioner's Guide To Product Management
by Jock Busuttil
“This is a great book for Product Managers or those considering a career in Product Management.”— Lyndsay Denton