Increase Decision-Making Momentum Through Data — with 5 Analyses to Try.
As a product leader, you have one of the best jobs in the world. And why’s that? You’re responsible for turning ideas into tangible value. To get from points A to Z, you need to flex a lot of cognitive muscles and draw from your product manager skills — and that’s exciting because every day has the potential to introduce new roadmaps. These product roadmaps can be especially tough for organizations operating in uncertain, unpredictable times — particularly if you and your product team are working remotely for the first time.
From conducting customer interviews and user testing to performing market assessments, allocating resources, prioritizing features, adjusting pricing, and revenue modelling, you have the opportunity to create a ripple effect inside and outside of your organization. It’s your product manager skills that have the potential to ensure your organization maintains a steady operational ship, despite any unforeseen challenges.
But there’s the flip side to the positive aspects of your role (isn’t there always?) — the biggest being that your entire organization relies upon you to make the best possible judgment calls. More often than not, you need to make perfect decisions with imperfect data and metrics. How do you effectively balance that tightrope walk of art and science? How do you make decisions at faster speeds, during a time when uncertainty is the new normal? This approach requires a mix of strategic thinking and prioritization, qualitative insights, and quantitative analyses.
Here’s What Makes a Stand-Out Product Manager
The best product managers have a superpower for driving initiatives forward by aligning product team collaboration with customer insights and revenue goals. Especially if you’re managing teams globally or remotely, it’s up to you to ensure that everyone is on the same page.
“The best PMs I have worked with have mastered the core competencies, have a high EQ, and work for the right company, for them,” writes Julia Austen, senior lecturer at Harvard Business School, who also serves as a director, adviser, and executive coach to early-stage companies.
“Beyond shipping new features on a regular cadence and keeping the peace between engineering and the design team, the best PMs create products with strong user adoption that have exponential revenue growth and perhaps even disrupt an industry,” elaborates Austen.
Your career success depends on your ability to have a growth mindset — that is, “a belief that our basic abilities can be developed and improved through dedication and hard work,” writes Tchiki Davis ,Ph.D. for Psychology Today. A growth mindset, above all, means that you’re adaptable to change.
Your product manager skills — and consequently, the impact that you have on the rest of your organization — are always in a state of development.
- Your product gets better when you do more market research and incorporate more feedback from your team
- As your product gets better, your revenues grow — and as your revenues grow, your company evolves too
- As you build up your own emotional intelligence under higher stakes situations, you’re able to improve collaboration among cross-functional teams and accelerate product development
Accomplishing these goals — and making better decisions — means being able to embrace a perspective beyond your human instincts. That means creating the right foundations for data-driven thinking, so that everyone is on the same page no matter where they are geographically or what functions they hold. Before you think about data or the types of analyses you need, you’ll want to consider the following:
Outsmart Your Human Biases to Align Your Team Around Better Decisions
Hugh Molotsi, a former product management leader with Intuit who recently became a full-time entrepreneur, explains that the biggest step towards these goals is to outsmart your cognitive biases and human instincts.
“Human beings are predisposed to think their first idea is the best approach instead of considering many alternatives,” he recently wrote for the Lean Startup Company Blog. “Simply put, our first ideas are rarely our best ideas, yet we can’t fight the instinct to stop ideating once we feel we’ve had a eureka moment.”
He elaborates that successful product leaders will guide their teams through a process of falling in love with customers’ pain points or problems. He suggests several steps that product owners can take in forming judgment calls:
- Draft a vision statement that describes how the world will change as you solve a problem
- Write down ideas so that you can more easily prioritize what your team needs to pursue
- Clarify your assumptions before you put an idea to the test
By aligning around facts, you’ll also encourage a deeper sense of collaboration between all of your various stakeholders.
“When requirements are nimble, the product owner has more time to understand and keep pace with the market,” a technology account manager for Atlassian, from the company’s blog. “And keeping them informative-but-brief empowers the development team to use whatever implementation fits their architecture and technology stack best.”
So how do you level-up the way that you and your product team make decisions? The short answer is that your data needs to do the heavy lifting for you, to minimize the potential for human bias.
Try These Analyses to Level-Up Your Performance
The people on your team need democratized access to a single data source, a universal source of truth, to make their best decisions.
What happens if they don’t? In the best-case scenario, you may need to rely on intuition and guesswork — which would create room for human error. In the worst-case scenario, your business could implode following a series of poor decisions (yes seriously).
If you’re interested in how a worst-case scenario could unfold, take a look at this article from Hiten Shah, former co-founder and product owner at KISSmetrics. In the story, he shares how his judgment calls prevented his team from doing their best work. There were a few issues at play:
- Lack of product direction
- Recency bias
- “Intuition” based decision
- Lack of trust between leadership, project management and their team
The takeaway from this story is that even the smartest and most talented decision-makers need to step outside their personal world-views to empower every individual in the company to make their best judgment calls.
Hiten up-leveled his emotional intelligence the hard way, but you don’t have to follow his path. Having the right analyses on-hand can have you make better judgment calls before problems have a chance to unfold.
The following analytic techniques can help you democratize your decision-making process in a way that empowers everyone at your company. The data you see comes from a hypothetical startup that offers a digital subscription service.
1. Multi-path funnel analysis
No two customer journeys are the same. We live in a digital age in which people self-direct their user experiences and have unique preferences with respect to their devices. The digital economy unites people with very different world-views around common experiences.
For your company to make its best judgment calls, it’s important to have a holistic understanding of these various journeys, along with the similarities and differences between them. That’s how you can determine a comprehensive understanding of how customers are navigating through the product and comparing the paths to find out which ones are optimal.
2. Cohort analysis
When you launch a new product and features, there are always unknowns. For instance, a feature upgrade could result in unforeseen customer disengagement that is predictable and resolvable through cohort analysis.
With this analysis, you can track such aspects of your product that engage more customers, understand how different behaviors contribute to higher retention rates, and identify key repeat customer behaviors.
This SQL-free approach makes it possible for everyone on your team — even people without a quantitative background nor technical skills — to pitch in data-driven ideas that can impact the organization as a whole. A stronger braintrust means that everyone can work on prioritizing feature implementations that will maintain user engagement more collaboratively.
3. Funnel optimization
Customer journeys are complex with many twists and turns. How do you ensure that your buyers have smooth experiences along the way?
The first step is to understand the key differences in how customers interact with your product. Let’s say that there are five steps required to complete a purchase, as an example. In order to keep customers along the path to conversion, you need to explore individual journeys and create personalized segments to understand where and why drop off rates are high.
People Insights can help you pinpoint where experiences have the potential to get better by helping you optimize marketing campaigns and retarget specific audiences. Digging in a bit, you can figure out exactly why.
Perhaps there is a bug with the submit button, for instance, or there are too many fields. With this insight, you can tackle the areas of your product that yield the biggest opportunity for optimized funnel conversion.
4. A/B analyses
Most likely, you’re already running A/B tests to optimize aspects of your product. But single A/B tests only present a static picture of specific moments in time. In reality, your users are making a series of decisions — one after the other. In addition to simply running A/B tests, it is important to craft a picture of how these experiments fit into the broader user journey.
As an example, maybe there’s an A/B test on a push notification trying to get audiences to rate a recipe. Variant 2 wins in terms of getting people to click on the notification. That’s a simple result – Variant 2 generates more clicks.
In Indicative, you can connect that experiment with results further downstream. For example, which variant resulted in recipes actually getting rated — beyond clicks to the app? Which variant encouraged people to come back to rate more than one recipe?
A/B analyses can help you build deeper stories around one-off experiments with respect to your team’s overall business goals. This perspective can help you do things like establish causal relationships and identify how changes translate into actions downstream. You can gain a deeper understanding of the ripple effects of your experiments.
5. User Segment analyses
These days, it’s impossible to generalize users into large groups. Even within segments, there are many sub-segments.
With a segment analysis, you can understand the similarities and differences between all groups using your product. With this perspective, your team can better understand how different segments use different features, identify which segments are the highest engaged, and figure out which segments aren’t engaging to their fullest potential and why.
You can learn what these individuals are doing on your platform and from there, encourage behaviors that can help make that segment more successful. You can also identify opportunities to engage people who may be outliers to typical trends.
But what is typical, anyway?
As a product manager, you have a unique vantage point into the way that dots connect in your user journey funnels. But how do you build the clearest perspective possible? Having access to data is only part of the equation. What you need are workflows that help you make sense of the information that you’re collecting from a human interest perspective. Data needs to help your team make its best possible judgment calls. The answers you need are in stories and visualizations — not spreadsheets or lines of SQL code.
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