1. The Concept of Product Strategy

Welcome to another lesson in the Product Leadership course from PM3. In this class, we will dive into the fundamentals of product strategy. My name is Raphael Farinazzo, and much of what I will discuss is drawn from my experiences at various companies. This lesson is divided into three parts:

  1. The concept of strategy and its associated principles.
  2. The components of a good strategy.
  3. The roles involved in developing a product strategy.

1. The Concept of Strategy

Understanding Strategy

When discussing strategy, particularly product strategy, the term can cause confusion. People often debate whether product managers (PMs) should focus only on tactical levels or whether they should also contribute strategically. Strategy is often misunderstood as something important, but not necessarily strategic.

Let’s begin by examining various definitions of strategy from respected thought leaders in the field:

Simplifying Strategy

If we combine all these definitions, we can simplify the concept of strategy to: The first decision that a company makes to move from Point A to Point B.

This means:

Strategy is about making deliberate decisions to move forward, knowing that resources are limited and obstacles exist.

Strategy in Practice: Deliberate vs. Emergent

While strategies are often presented as well-planned, the reality is that they are rarely like the perfectly fitting pieces of Tetris. A more fitting analogy is the game Enduro, where unexpected obstacles appear, and you must adjust your course to continue moving forward. Strategy often combines both deliberate and emergent elements.

It’s important to have a deliberate strategy, but you also need mechanisms in place to detect when new opportunities arise and be agile enough to adjust your course accordingly.

The Role of Vision in Strategy

Vision and strategy are closely linked. The vision answers the question, "What does success look like for us?" Strategy is about how you will realize that vision.

Here's a simplified breakdown:

Strategy as a Leap of Faith

While strategy involves careful planning, it also requires taking a leap of faith. You are making decisions about the future with incomplete information, particularly in terms of technical feasibility and usability. However, you can reduce this risk by making informed assumptions about value and business viability.

For instance, human needs and behaviors do not change drastically from one year to the next, so value assumptions tend to be less risky. Business viability can often be assessed early on, even if some aspects remain uncertain.

Conclusion

In summary, strategy is the process of guiding your company from where it is now (Point A) to where it wants to be (Point B), while considering obstacles, resources, and market conditions. While strategy often involves a mix of deliberate planning and emergent adjustments, the goal is always to maintain a coherent and focused approach that moves the company forward.

This sets the stage for understanding the components of a strong product strategy, which will be covered in the next part of the lesson.