The Decision Stack. Strategy for Product Teams.

Host: I'm super happy to be here with Martin. Martin, welcome.

Martin Ericsson: Thank you so much. It wouldn't be a tech event without some AV issues. Right?

Host: Yeah. And of course I have the book.

Martin Ericsson: With you.

Host: With me. Um, had the chance to read through it yesterday and really looking forward to this conversation. Uh, slash, presentation. Um, we will, we will start off with a little presentation from you. You going to show us the key, the essential, um, components or concepts of the book? Um, about 20 minutes. Right. And afterwards, um, we will have a conversation. Maybe, um, I'll give a short introduction of you or you. Please, you yourself introduce yourself just briefly.

Martin Ericsson: Uh, I'll do a little bit of it in the talk, I think. But yeah. My name is Martin Ericsson. I've been in product for over 30. I built my first, uh, website in 1994, ran what I think is probably the first, uh, online livestream in Europe, if not in Scandinavia, uh, in 1995 and became a product manager in 99 and basically haven't looked back. Uh, most recently was a product partner at eqt, one of the world's largest private investors. I've co authored a book on product leadership. I just authored the decision stack that Thomas was showing. And of course I was the founder of Product Tank and co founder of Mind the Product Together, the world's largest community for product people. So I care a little bit about product.

Host: Yes. And we met last year in the product conference and prow, uh, in Timizuara. And um, that's how we know each other. And I think that's more than enough. I think most people know you anyway and then I would just, you know, hand over to you, um, you know, give an introduction to the book, uh, to the audience and, and um, yeah, just take it from there.

Martin Ericsson: Great. Thanks so much for organizing. Yeah. So, really want to talk about strategy. Um, and I think the problem is it sucks in most places. And so I want to share kind of what you can do about it. Uh, so like I said, been doing this for nearly 30 years. Co, uh, author. Product leadership really is an excuse to interview hundreds of product leaders. And then since then I've advised nearly 150 portfolio companies. And the point is, throughout that whole journey I've kind of been obsessed with what it takes for the best teams to work. Right. If we look at like small startups, the best teams, they all kind of fit around a desk. Everyone has this like, implied sense of what we're doing, why we're doing it, uh, what's important then as we scale, you know, it starts getting a little tricky to do that, communication. But we can all kind of see each other, we all know what's happening. And then at some point we end up on multiple floors, multiple buildings, multiple locations, and. And that becomes really, really difficult. So I guess I've been obsessed with this question of like, how do we get these bigger organizations to work more like those smaller organizations. And so if we look back at the last 10, 20 years, right, we have iterative ways of working, we have agile and all the methodologies that came after that, we have cross functional teams. And all the conversations we've been having about that, hopefully we're talking about empowering those teams to make better decisions faster. And then now we're dropping AI on top of everything. So let's just go fast, right? But there's a problem here and there's a distinction that comes actually from science. So there's a difference between speed, just going fast, velocity and momentum. Speed is a little bit like setting jet fuel on fire on a Runway. It has no direction. It's just pure, unabated energy. Right? It's spectacular. You might be able to warm your hands for a little bit, but you're not actually going to get anywhere. Velocity is speed with direction. So suddenly you're putting that jet fuel into an engine and you're actually going somewhere. But even more importantly, momentum is speed with direction times mass. So it's bringing that organization along with you in the same direction. And everyone's going the same place. So we can move fast. But the big question is, are we going in the right direction? Well, let's ask the team.

Narrator: So what are you gonna do with all these underpants that you steal? Collecting underpants is just phase one. Phase one, collect underpants. So what's phase two? Hey, what's phase two? Phase one, we collect underpants. Yeah, yeah, yeah. But what about phase two? Well, phase three is profit. Get it? I don't get it. Spells one, collect underpants. Fells two. Spells three, profit. Oh, ah, I get it. No, you don't.

Martin Ericsson: So hopefully there's a few fans of south park out there, but you'll be surprised how often this is what the conversation sounds like when I come into an organization. Right? It's like, so what are you working on? Oh, you know, we're working this conversion rate or we're shipping this feature, or we're building this thing, or we're going into this market. And then you ask, okay, why? And then you get that same blank stare and then someone goes, eventually. Oh, profit. And Research backs this up, right? There's Harvard Business Research, um, review research that shows that 95% of employees don't know their organization's strategy. This is so pervasive that this is even a prompt in the game Cards against Humanity. And the problem is we play really, really bad cards. We start talking about enterprise features. No self service features, no we want more clicks, no conversion leads, brand, actually, you know, AI. AI is going to solve everything. And so in most organizations we have a pretty good sense of where we might be going, right? We have a sense of a vision, a purpose, a mission, whatever you want to call it. We know that kind of North Star. But if you start asking how we're actually going to get there, you're met with that blank stare that we just saw in the cartoon. And then inevitably, the teams try to do. Sorry. Inevitably the teams try to do everything right, or are told to do everything. Everything has an equal priority. Everything is important. But as Peter Drucker, one of my favorite business authors, said, there is nothing quite so useless as doing with great efficiency that which should not be done at all. And it's even worse when you look at it from the bottom up. So any individual contributors in the room, if you're a product manager, a designer, an engineer, you're looking at that piece of work in front of you and um, maybe you can ask why? And say, why is this important? Hopefully it connects to some goals, some KPIs, some OKRs, something. But then you ask, why are those important? And again, you're met with that same blank stare. So George Patton was a famous World War II general, and he was one of the leaders around kind of this idea of empowered teams or autonomous teams giving a, a military team a mission but not telling them how to get there. And so he is famous for saying, if you tell people where to go but not how to get there, you will be amazed at the results. And I would argue that if you tell, if you forget to tell people where to go, you still don't tell them how to get there, you're going to be amazed at the results. It probably just isn't going to be the results that you actually want. So how do we connect the dots? Well, I think every organization, every team has to be able to answer five questions. Simple questions. Where are we going? How are we going to get there? What matters right now on that journey? What actions are we going to take to move forward? And how do we choose between those actions? Now, these connect from the top to bottom by asking how but Even more importantly, they connect from the bottom to top by asking why. I call this the decision stack and it's what the book is all about. And I use vision, strategy, objectives, opportunities and principles to answer those questions. The point here for me is that it's not important what you use to answer the questions. If you don't like okrs, that's fine. Not everybody does. But as long as you have something that answers that question of what matters right now on the journey and how do we measure progress, that's fine. And as long as those connect to the other answers. Now, the stack is really interesting because it is a stack of decisions, right? So from the top down, you're starting to M. Every level is a decision. Your vision is a set of decisions about who you're going to serve, why that's important, and you're saying no to everything else. Your strategy is then even more focused. All right, given that vision, here's how we're going to get there, here's how we're going to win, here's the customer, and so on. So at every level, you're clearly saying yes to some things, but even more importantly, you're saying no to others. Now, the decision stack probably exists at lots of different levels of your organization and can often look something like this. It becomes a fractal mess. But the most important thing is to focus on what's right in front of you. What does your team, your product, your business unit kind of look like? And again, it's useful because it starts highlighting when things don't connect, right? You might have an opportunity in front of you and it doesn't connect to an objective. And you can rightfully challenge why we should do that. You might have a whole objective that doesn't make any sense. But even more importantly, it, uh, really highlights when something's completely missing. And as we all know, if you take out the wrong block, the result can be really, really painful. So in that experience, I've seen that the stack breaks down in two really important places. And that's what I want to cover today. Strategy and principles. Strategy has become almost one of these four letter words, right? It means so many different things to different people. It's such a loaded word. You talk about strategy off sites, everyone starts rolling their eyes. But as Rita McGrath says, in a fast moving world, strategy is more critical than ever because organizations have to make more choices. And the problem with most strategy is that again, we start playing really bad cards. We think of vision, okrs, KPI's, roadmaps, goals no, wait. AI, AI everywhere there's our strategy. So it's worth taking a step back and really asking ourselves what strategy actually is. You can go academic and you can pick up Strategy Safari by Mintzberg, Ahlstrand and Lampel. It's a fantastic book. It goes through the kind of academic approach, identifies 10 different schools of strategy. Uh, and by the time you're halfway through the book, your head's going to hurt a little bit. So you're going to want to simplify. And I like leaning on the greats in everything I do. So we can go to Michael Porter, one of the first books about business strategy, where he defines it as making choices about deliberately choosing to be different. Or you can look at Playing to Win by AJ Uh, Lafley and Roger Martin, where they define it as two simple where are you going to play and how are you going to win there? Or you can go to Richard Rumholt's Good Strategy, Bad Strategy, another classic that defines strategy as a way to deal with a challenge. So I didn't really set out to define strategy, but if you combine those, you can see that great strategy is a coherent set of choices about the actions we are going to take in order to achieve our vision. So no wonder we get confused when we were met with that blank stare and we can't connect our vision to the work in front of us. Great. Let's go fill out a strategy template. Well, hopefully you saw the trap there. There is no strategy template. You can't copy paste. There's no right framework. There isn't even a right strategy. I learned this fairly early on in, uh, my first VP product role when I was competing with Dropbox and Box. These are both US Companies that were focused on file storage. They both did the freemium to enterprise journey, just as every SaaS company did around 2010. They were both really strongly focused on file sharing. Box had a few tools around the edges, but really was focused on file sharing. Then the strategies started diverging, right? Dropbox basically invented product LED growth went with self Serve, bottom up, Motion Land and expand, all those things. While Box pursued a much more traditional sales model. Dropbox raised nearly $1.1 billion during their before their IPO and box about 600 million. And the outcomes were different, right? Dropbox, this is now maybe a year old, but Dropbox valued about 7.5 billion and box 4.2. Now you might look at that and say, well, Dropbox won, right? Their strategy must have been better. But if you actually look on the return on investment on, uh, money they raised, they're about equal. So you could actually argue they've made specific choices but ended up with a good result on both sides. So there's no such thing as the right strategy, but there is a wrong strategy. So I was the VP product at Huddle, a small UK startup that was trying to compete with these guys and we had a very different approach. We thought that we should build everything right. Collaboration meant not just file storage, but whiteboards, chat, um, task management, like all these tools around the office. We did the same freemium to enterprise journey. We, uh, went traditional failed sales. Because we were in the UK, we could only raise about 90 million. And because of that I believe we couldn't build any of those things well enough to compete and instead built five slightly mediocre products and therefore obviously Dropbox and Box won. And then Slack took Chat. Eventually all these other tools came along and took each piece of that puzzle that we were trying to build. So how do you actually start designing strategy? Well, again, there's hundreds of different tools and this list is 10 years old. So tools don't make a strategy, people do. I like some tools. Thomas probably likes other ones. You might like other ones still, that's okay. The tools don't matter. It's the journey to a shared understanding with your team that does. Because strategy is fundamentally a mindset. It's a problem solving challenge. And that's something that product design and engineering should be really, really good at. The strategic mind explores lots of different lenses, different ways to approach a problem, brings all that experience to bear and figures out the best solution. Strategy also isn't the slides at the end, it's the collaboration that got you there. So while, uh, leadership should start it, the team should always be involved. And at some point, leadership has to get out of the way and let the team execute. Because this is about context, not control. Often when I talk about these choices we have to make at the strategic level, teams start thinking like that sounds like, uh, command and control. That sounds like micromanagement. But it's not at all about defining the, you know, down to the feature level or, you know, down to that kind of detail level. It's really about setting a context and letting the team still figure out how to get there. And as such it's part art and part science. Right? It's a scientific, uh, hypothesis at the end of the day, uh, that we have to subject to the same kind of testing that we would anything we do in our product. And again, we have tons of tools for this, right? There's so many different options to test this. We know this from design, from ux, from research, from the discovery that we do as product people. As David Bland says, your number one job is to test your business ideas to reduce the risk of failure. And I really can't recommend his book enough. It's uh, like 40 very specific ways to test these sorts of things. It's also important to say that strategy is never done right. It used to be this like five year thing and then we'd put it on the shelf and kind of forget about it and come back to it later. But these days it's a constant cycle, just like our product. Work around, you know, diagnosing what's current, exploring possible solutions, setting a course, and then acting to learn. So I get it. Strategy is really, really hard. That's a lot of work I just talked about, right? But that's not an excuse not to do it, and it's not an excuse not to learn how to do it. Well, go back to first principles. We all have these as product people, right? What are we trying to solve? How does that benefit the customer? And how can we be more intentional about getting from where we are to where we want to be? But coming up with the strategy is actually the easy bit. Bringing the organization with you, building that momentum, that's the real work. So to do that, you can ask why often, right? Anyone in the organization should be empowered to ask these questions. Why is this important? Why does this connect to strategy? Why does that connect to our vision? And so on. The more you can challenge this, the more clarity you can get for you and the rest of your team. It's also good to think 10x, not 10%, especially in this world of AI where everything is changing so fast. Instead of just thinking, what would I have to do to get 10% more conversion or 10% more users here, start asking yourself, what would I need to do to get 10x? Because it really opens up a very different way of thinking. And as product people, we know this, but we forget you have to fall in love with the problem, not the solution. It's so much more important to always be focused on that customer need, that customer problem that we want to solve. Because new solutions will always come up, especially at the pace of technology today. And then you have to let your team in on the strategy, leverage everybody's creativity and insights, stop talking about features and focus instead on customer problems. Strategy goals. Encourage your teams to say no to things and coach them, uh, on strategic thinking by discussing value and context. I love Peter Drucker so much I had to have a second quote. Strategy, uh, without communication is just a plan. And a plan without communication is just a dream. So you can literally never talk about strategy too much. You can never repeat it too often. As the CEO of LinkedIn says, when you are tired of saying it, people are starting to hear it. So if you're co located, think about how you can stick it up on a wall, right? Nothing beats that strategy clarity of having it up on a wall next to you. If you're remote, stick it at the front of every slide deck, your figma, your whiteboard, whatever tools you're using. That doesn't mean you're spending an hour talking about it every week, but just as a reminder, at the top of every all hands, at the top of every planning meeting, at the top of every kickoff that you might be doing, and make sure that it's a living document. This should be an ugly thing with lots of post it notes on it, lots of updates, you know, sketches, notes, things like that. Not a polished slide deck that you never want to edit. And use those existing ceremonies to make sure this sticks. As Admiral Hopper, creator, uh, of the first computer manual, creator of cobol, so much more says the most dangerous phrase in the English language is we've always done it this way. So to put it simply, how to be more strategic is simply to challenge the status quo, not just in how we build products, but in how we make those decisions internally. So the other end, the stack breaks down is principles. And principles are one of these really underutilized tools. And I was lucky enough to learn it early on in my career when I was a product manager at Monster in 1999. And can we all just take a minute to marvel at what the Internet looked like in 1999? Kind of wish it was still that simple sometimes, um, when I joined, obviously, um, Monster is a job board and as such a two sided marketplace. Um, so we have job seekers on the one hand looking for jobs and recruiters on the other who are looking to hire people. And when I joined, every conversation, every product initiative kind of centered on that debate. Do we want to do this in a job seeker friendly way or do we want to do this in a recruiter friendly way? And those debates could take months. Like this is back in waterfall days as well, right? We would take six months to write a product spec, throw it over the wall. So we would debate that back and forth, back and forth, back and forth. Finally write something down until I was outside the headquarters just outside Boston or in the headquarters just outside Boston, uh, having the same debate again and see the CEO and founder walk past. This is the beauty of a startup. I could pull him into the room and ask him, can you just help us make this decision? We're not sure which way to go. So he listened for a few minutes and then he said, hang on. Job seekers always come first because if we build an amazing experience for them, then recruiters have to follow. Now again, this was buried somewhere in the strategy deck. This was kind of a, uh, decision that they'd made at the top, but we didn't know about at the bottom. And so we were relitigating this conversation, this decision every single time. But suddenly we had a clear principles and those decisions all went away. We never had to have the debate again. We just knew in any trade off, job seekers always came first. So past decisions can help focus future decisions. And these are the decisions that become your principles. Principles are not the same thing as values. I'm sure all of us out there have some version of values like build a delightful user experience, make something people want, or excellence. The industry is rife for them. And this is research shared by my friends at Singh from a few years ago. But I can also bet you that nobody in your team has ever come into a room and gone, I have a really, really good idea, I want to build a really shitty user experience. And then someone else on the team goes, wait a minute, our values say we build great ones. These aren't trade offs, right? So principles have to be a framework for decision making and they do that by being really specific about those trade offs. And you can use something called an even overstatement to do that. So you might talk about conversion even over revenue as Monster did. You might talk about job seeker even over recruiter, you might talk about mobile even over desktop. You might recognize these from the Agile manifesto. And just like in the Agile manifesto, we're not saying that the thing on the right is not important, we're just saying in any trade off scenario, the thing on the left is more important. So some good examples out there are focus on the user and all else will follow. Like Google says, Shopify is another two sided marketplace, but they actually flip it on its head and say put merchants first because they believe by having the best possible experience for their merchants, they get lots and lots of interesting merchants, interesting shops, and that will bring consumers. Klarna at one point, this is probably before their IPO and had conversion trumps profitability optimization because they wanted their teams to focus on getting the sale, even over getting every last percent of profit out of it. And Supercell, the gaming company, has one around long term retention, even over short term retention. Now again, this is a mobile gaming company. They live and die by day one, day seven month one retention. Of course they care about short term retention, but they still want their teams to focus even more on that long term retention and that long term engagement with their players. So principles have to cost you something, right? They're an articulation between two good alternatives. We're not saying great user experience even over bad user experience, because no one's going to make that argument, right? If you take that out, no one's going to argue for a bad user experience. So it has to be a good thing over a good thing. They also reflect your strategy, right? Just like that monster story. This had been articulated in the strategy, but hadn't really been communicated clearly enough to the rest of the organization. And everything that you said no to as you develop your stack is probably a principle. And principles are really important because you want to have those debates, you want to have the job seeker versus recruiter debate, you want to go look at data, you want to go do the research, you want to do some hypothesis testing, you want to work with your stakeholders, you want to have loud shouting arguments in a meeting room if you have to. But you want to have it once then. Then you want to codify it, make it a decision that's consistent for the rest of the organization and move on. And as much as I can complain about values, principles can make those values actionable. So instead of just saying build a delightful user experience, you might say it's intuitive, not learned, like Pinterest does, to emphasize that they want the experience to be as easy to understand as possible and not rely on kind of help text and things like that. Instead of just saying make something people want, you can say we design for everyone as co op in the UK do to emphasize accessibility and usability. Instead of just saying excellence, you can define it like saying fast is better than slow, as Google does. So good principles describe how you want to build your business. They make a choice between two good things and therefore they're specific to your company, your strategy, your vision. Bad principles, on the other hand, are the meaningless fluff or just generic values that everybody in our industry has their wall, or they're trying to make a false choice between a good thing and a bad thing. And either of those don't differentiate you from your competition, right? Everybody wants to make a delightful experience. So in order to build these principles in your organization, m think about two directions. So from the top down, if you're in leadership for sure, make sure that you're reinforcing your strategy by articulating the acceptable trade offs as principles. What is really going to make your strategy successful? And then provide focus for your teams by helping them say no to distractions. But from the bottom up, you have power too. So use your retrospectives, right? Codify regular debates. What are the things you keep coming back to keep having a discussion about? What are the assumptions that you've challenged in that sprint that quarter, that, that year? What have you said no to? Because that's probably a principle. And if you're still stuck, you can play the this or that game, as my friend Adam Warburton came up with, where you literally just present two options to everyone on the team. I've even built an app for this. Um, we can share the link at the end, but it's this or that.thedecisionstack.com free to use. And it's really just a way to see what everyone else thinks. Now obviously the list of trade offs here are going to be different for every organization, but it can be really useful to think about and challenge and get that conversation going to say, like, what do we care more about? Do we care about new users or retaining users? Growth or profitability? Customization, simplicity. You very quickly see you have different opinions in your team and you can start a, uh, conversation that gets you to some clarity. So that's the decision stack. And hopefully the next time somebody deals you this card, you know that the answers are strategy and principles and that's how you can connect the dots for your team. This is not just about leadership because a decision stack is everybody's responsibility. At the end of the day, it's a problem solving challenge. So we should be using our product design, engineering, data superpowers to solve it. You should keep asking questions until your stack is clear, but you should also keep answering those questions because you're the ones closest to the data, closest to the insights, closest to the customer. And you can bring all that insight to help focus the rest of the organization. Use principles to drive strategy and strategy to drive principles because they kind of sandwich the real work, right? And make sure that you stay focused, set the right cadence of change. Right? Your vision is probably pretty static. I like visions that are almost not achievable in our lifetimes. Your strategy is anything from six months to three years now, right? If you're a startup, you're. Your strategy is basically as long as your Runway. If you're more established product or more established business, it can be a longer time frame. Objectives or okrs are usually on a quarterly basis, but I actually like six weekly focus opportunities. As you hopefully all know is in constant flux as we learn new things and do discovery with our customers and principles evolve somewhere in between. But most importantly, if at any point we learn something new that has invalidated a previous assignment assumption, change it now. Don't wait for the end of the quarter, don't wait for the end of the year to do the strategy review. Change it now. As Katerina, the co founder of Flickr said so often, people are working hard at the wrong thing, but working on the right thing is actually more important. So stop waiting for permission and use the decision stack to drive better strategy and clearer principles because that will make sure that you and your team are working on the right thing. So thank you very much and let's switch to Q and A.

Host: I just cheer for everybody here. Okay, well, thank you very much. Was really, uh, it's always so spot on. Right. I saw something similar already on prowl but you know, like a totally different. Different thoughts again. Right. And uh, it's always, I think as strategy itself. You know, it's just good to hear it over and over. Um, yeah, if you're listening, you can type in some um, question in the, in the comments. I have an eye on that. Um, and maybe come back to, to that. But let me, let me get started with a few questions. Um, you know, let me take that into reality. I know, um, it's not only. It's not primarily written for product managers but you know, like we have a lot of product managers in the master class and um, I cannot remember that somebody said like I know exactly what's our strategy and um, you know, has a clear picture about that. What is, you know, like what is your advice for people, you know, on the operational level, PMs, POs, whatsoever. How do they deal with that situation?

Martin Ericsson: Yeah, so I think, I mean hopefully, um, this and the book and you know, the workshop that we're going to do together in Munich, like it's all about empowering uh, individual product managers as much as leaders to be more strategic. Right. I don't think strategy is just a C suite thing. I don't think it's a CEO thing. I don't think it's like something you are born with as like a special skill. I think it's A muscle that we can all get better at. And like a muscle, you just have to practice, right? And I think it's important, even more important now with the speed that everything is going with AI going so much faster. Like, we need better clarity, better strategy, better choices. Because if everyone can build everything for free, right, or we're headed in that direction, it's even more important to have a point of view and a bet on, like, what do we think the future is going to look like? How can we serve these customers better? And that's really what strategy is, right? So I would really encourage everybody, whether you're a leader or whether you're a product manager, designer, engineer, to ask these questions, right? Just simply start asking, like, why is this important? How does this connect to our strategy? Like, help pull those pieces together. Like, even if it was, you know, oh, last week we heard in the all hands, they were talking about our strategy is this. Now, this week we're planning them M. It looks like we're looking at this, like, how do those connect? Like, just help me understand, like, it doesn't always have to be something where we're challenging our managers and like, calling them out for doing something wrong. It is just asking for that clarity. And I think the more we challenge those and ask questions, the more we bring evidence of that conversation, the more we then bring other ideas, like, oh, if that was our strategy, like, why aren't we building X? Because I think that would get there faster, that would achieve this. You know, those are the kind of conversations I always want, um, my teams to be having. And I always want my engineers, designers, product managers to be challenging me as a product leader with. So really, I would just empower you to think about these things and be more confident to ask the questions and to do that. Like, there's lots of tools. There's a lot of stuff I've written about on the website, but obviously also in the book about how to ask those questions without challenging too much, uh, and bringing your own perspective to it. But I do think we have to start from somewhere. And so we have to start from what's right in front of us, try to build that clarity, even if it's just for our team, right? Like, what do we focus on? What do we care about? What do we think is important? And then start building that up and outward to the rest of our organization as well.

Host: So it's basically, you need to understand your business yourself as a product manager, 100 picture, uh, and everything, uh, in order to make better decisions, right?

Martin Ericsson: Yeah. And I mean we've, we've been talking about that for a while, right. I think. And there's a bunch of great books that have come out recently. So Matt LeMay wrote Impact first, product teams. Uh, Rich Marino's just written money stories like, and they're all about the same thing, right? I think every product manager has to be much closer to the business than we probably have been for the last five, ten years. Um, you know, when I wrote, I don't know if you remember the, the famous Venn diagram of product, right. I wrote that blog Post in, in 2011, defining product as the intersection of UX business and technology. And so many misunderstandings in that. But if you read that post, it's also like product is first and foremost a business role, right? Our job is to create value for our customers and then capture that value for the business. Um, and so that has to be the focus, right? We have to understand the business levers, we have to understand that strategy, we have to understand how we can differentiate ourselves, how we can position ourselves, uh, versus the competition and so on. Um, that's the job, right?

Host: For me, it feels a little bit like a pendulum. I mean, we had like, you know, like the last. Now, um, it's going heavily again towards the business perspective. But you know, like, it was a long time with all the scrum stuff. It was more focused on, you know, building software, delivering stuff, you know. But you know, like now I think the bigger context, the business side is coming back. Is that how you feel too?

Martin Ericsson: Yeah, I think, I mean, definitely the way we talk about it is a pendulum and swinging and I don't think we're over correcting. Like, I think it's back to where it should have been, which is on the business side. I think everything else is just to enable that. Right. Uh, and look, I'm a massive fan of Agile, if not necessarily some of the specific implementations of it, but in terms of obviously being able to move forward fast and iteratively and then everything we're doing with AI now lets us move even faster. Like the building part almost to me is, is solved, right? We kind of know how to do it, we know how to do it fast, we can do it faster and better than ever. Um, but that's not the hard part anymore. That the hard part is like, what should we build in the first place, what's important, how do we stand out, how do we compete? Uh, and so maybe that's why the pendulum is swinging back, right? When differentiation kind of disappears, if everyone can Build quickly. Um, that's where the differentiation is going to be. And so I think it's rightfully coming back to the value side. Yeah.

Host: M. It's also like we felt that when we started the product masterclass because we saw like, okay, you know, like just software delivery is not enough to be a good product manager. Right? And then, you know, like, uh, there is more components to it, just like you, you described. So as a product manager, okay, understand bigger context, ask the questions. Who is actually the driving force for the strategy? Like for me, you know, like it felt for many, many years always like this fuzzy thing, nobody is responsible. And it's always like, it's never clear, nobody's responsible. Like, what is your, what is your take on that? How do you, how do you nail that down somehow?

Martin Ericsson: I mean, I do think ultimately it is leadership's responsibility. So the C suite or whatever level of your organization to make sure it exists. And obviously the bigger the organization, you have multiple layers, so you probably need a, you know, a product strategy that per product, things like that. So the leadership at that level, it is leadership's responsibility. And I think it's another thing that we've forgotten as product leaders, right? Is that again, that is the job is to create the conditions in which our teams can make better decisions. And that is strategy. Right. And so I think, um, it's really important for any leaders in the room to make sure that you have this clarity. And I think it's so easy to forget, right? I've been a founder, I've been in those small startup teams, uh, and I've observed a bunch. It's so easy when we are in those to forget that just because it's clear to us, just because it's explicit to us doesn't mean it's clear to the rest of our organization. So I actually think the biggest challenge as a leader is probably actually communicating the strategy you already have, right? Making that clear, repeating it, making it consistent for the rest of the organization. Because I think again, like, uh, the classic way of doing it has always been that kind of off site or leadership disappearing into a room. And then they're looking at the data for months and months and months. And then by the time they're like, yep, this is the right direction, we've done the testing, we've done it. You know, even if you're doing strategy perfectly, you forget that no one else was in that room, right? So they don't have the context you have. They don't, they haven't looked at the Data as much as you have. They haven't looked at the research, they haven't looked at all these things. And so that one slide thing that comes out kind of goes in, in one head and you know, uh, in one ear and out the other because you're so focused on what's right in front of you. So as leaders it's so important that communication and clarity piece and that alignment piece and making sure all these things connect. Um, but again I do want to emphasize that I think individual contributors have a lot to do here, right? They can uh, and should be empowered to kind of challenge these questions and ask for that clarity. Right? If your strategy isn't clear to you, start asking your leadership like what are we doing? Why is that important? How's the focus? Like how does that help us compete? Like ask these questions to get clarity for you. Hopefully there is a strategy there and it's just not clear. And if it's not, uh, asking those questions will hopefully challenge leadership to do a better job of creating that focus.

Host: Do you think that more companies have the challenge to communicate an existing um, strategy and vision or, or do you think it's more that, you know, many people, many organization really lack the strategy itself?

Martin Ericsson: I think it's probably both. And that's not a cop out answer. Uh, but it is probably both. I think almost every organization has the challenge of communication. Again, whether your strategy is great or not, because it's hard to do, right? Especially as you scale, as you're growing, like new people joining the company all the time, new things happening. Like it's uh, a, it's a, it's, it's not easy to keep that up to date and communicate it. But again that is the job. But I do think, having said that in probably the majority of the organizations I go into, um, the strategy isn't good enough either, right? I think the strategy often is too fuzzy to your point. It's not clear enough, it hasn't made specific choices enough. And I think that's because leadership tends not to want to have to make some of those choices. Right? It can be tough, it can be really hard. Like do we bet the company on, you know, this customer segment or bet the company on this customer segment? Like that's scary, right? And so as leaders it's really figuring out how you de risk those things. And again we have a lot of the tools, right? Coming from lean, coming from agile, like how do we break down the assumptions, how do we go test the assumptions? Like all these things we have tools for These. But it can be a scary thing to have to make that choice and to reduce optionality, but that only by making those choices do you provide the focus that actually lets your teams, uh, run at this. This kind of speed that we want them to run at. So I do think it's both. Um, I do think almost every organization has a communication challenge, and I think most organizations probably don't make explicit enough choices in their strategy to make them really powerful.

Host: M. How do you deal with that as, you know, like in, in the leadership level, not as top leader, like, not as your responsible CEO, cpo, but you know, like one step below that. Because, you know, in my experience and what I see is, you know, managing up is always really hard. So any practical tips how you approach something like that? How do you, how do you infuse on a top level on. On that, you know, there is something missing, or do you do it yourself? Um, what's your best practice? What's your advice? What works in the practice?

Martin Ericsson: So I think the biggest thing here in like all stakeholder management, for me, it's. It's the making it about evidence and not about opinion. Right. So as soon as it's like, I think X, then leadership's gonna win. Right. Because they are the highest paid person's opinion. Right. And opinions. Um, but as soon as you make it about evidence and data, whether it's like, you know, I think we're, we're trying to do too much. Um, here's, like, here's everything that's in progress. We're trying to solve this for this customer group and this for this, and none of it's landing very well. We have a problem with retention. You know, whatever evidence you can bring to the conversation that, like, I need, we need to be more focused on solving one thing and doing it well, I think that's the kind of thing that gets people's attention. I think another hack that I love doing is I go into organizations and I ask everybody individually, like, what they think their strategy is, and you will not be surprised to hear I get different answers from almost everybody. And then you can play that back, right? Because then it's not about me. It's not me saying your strategy is terrible. It's, here's, you know, I talked to 10 people, I got 10 different answers. We have some work to do here. Right. Um, and then I think finally, yes, I do think, like, you can do the work yourself and present something up again. The more evidence you can bring behind it. Like, again, the kind of conversation around, you know, I don't think our strategy is super clear. I think it's this kind of thing. Therefore, like these are the choices I would make, this is the customer I would go after. Here's the data I have behind that. What do you think? Right. Opening it up to that conversation. But you can definitely do some of that work of defining some of this choices up front and what the consequences of that would be. Um, and that can be a great way to start the conversation because again, it's not about challenging opinion. It's not calling leadership out for not doing their job. It's just like coming with information and like, oh, this isn't super clear. So I think it should be the xyz. Here's the data I have behind it, like what have I missed? Right. It's a very different approach to the same question.

Host: Interesting. Let me ask a question from Sebastian, who put this in the uh, in the comments. When you have a company value of putting customers first, which part of the stack is the best to raise awareness that not all customers are created equal? And sadly not all customers are created equal. Is it principles, Is it strategy?

Martin Ericsson: So I think it kind of depends on how, where you're drawing that line. Right. So I agree not all customers are equal. Right. So you, your strategy should be defining like which customers are the important ones to go after. We're going after this segment, this market, you know, we're going after high net worth. Are we going after mass market? Like those are strategic choices. Um, I think principles can be about, you know, we are job seeker, even over recruiter kind of thing. That's a different user choice that you're making, right? I think the distinction as well is that for me, principles is something that still sits across the whole organization even though it might be identified at like the team level and then bubbled up. And the example here, like again going back to monster. You can imagine there were product teams that worked on recruiter products, right. All they did all day was working on the back end. The tooling, the applicant tracking systems, the billing, the payment. Like all things that were only recruiter, like a job seeker never saw. And there was an instinct to like, oh well, maybe they should have different principles. Right. But actually it's even more important that they have the same principle so that anything they build for the recruiter should always be job seeker first if there's in conflict, right. Most of the time it isn't. I need a billing system for job ads. That's not really going to impact job seekers. I Can build it in the best possible way for recruiters. But it might come to a feature like, oh, we want to be able to search the database and search by X feature. It's like that's actually not good for job seekers. So we shouldn't do that even if recruiters might want that. So some of those principles are actually across the whole organization and really remind everybody again what is most important in your strategy. And it's about that jobs in, in this case about job seeker first. So I think it depends kind of what trade off you're trying to make, right? If it's specific, getting more specific, then it's probably a strategy question. If it is that kind of trade off question between uh, types of user, then it might live in principle. And this is again where there's no right or wrong. Right. I really want to emphasize like I do think about this as a mental model. This is not meant to be a framework that you like, fill in perfectly exactly the way I do it. It should be a way to look at your organization and the choices in front of you, uh, and make sure that they connect. Really?

Host: Yeah. If I, if I, to be honest, to be fair, you know, like when, when I looked at it and wishing strategy, objective, opportunity, it's always a breakdown, right? So I was at, at first, you know, like I was okay. Principles don't understand that, huh. Um, um, now today I think I got it a little bit better. Um, I remember that Jeff Bezos gave an interview in 1999 and he said like Amazon is built on three pillars. Fast deliver, vast selection and uh, cheaper prices. Right. Is that, would you call that, is that a strategy for you? Is that a principle or is it

Martin Ericsson: doesn't matter or it's probably, those are probably strategy to me because there's the specific choices. So if you're thinking again about that like playing to win, right? So working where will we play? How will we win? Those are kind of answers to how will we win? Right. So those are specific ways of like this is how we think we can compete and win those markets. Um, I mean Amazon does have a principle. I can't remember the exact wording, but something about like customer first as well. Right. Where they wanted, you know, uh, and the A to Z thing like in their logo is all about that bread to selection. There are some of those things that are more principally. But I think those pillars are very, to me, strategy. Right. Because it's about how we're going to compete. Uh, and if you think about it, it starts breaking down Those choices, right? So like it's, we're going to have a vast selection means, you know, you're making certain choices about having lots and lots of options. You don't care about curation, you don't care about like an editorial view. You're just going to have all the options. Right? Um, so some of those things are more crystallized, like a little further down maybe. But um, again to me those are probably strategic choices.

Host: What is AI doing to that framework?

Martin Ericsson: I think it's just making it even more important, right? So I didn't write the book for AI. I barely mentioned AI in the book because I don't want it to date. But in all the conversations I've had since the book has come out and since the models come out is like it's only ever more important, right? Um, and actually the Chief Transformation Officer Miro really um, opened my eyes to this like when he was reading a beta version of the book where he said this is not just for like the humans in the organization, but this is absolutely critical as we start adding agents to the organization. Right? Because agents need even more strategic clarity and directions and principles and trade offs because otherwise they're going to run in the wrong direction. Not at human speed, but at machine speed. Right. So I think AI just makes it even more important, um, to be clear about what we're doing and why and to give, make those choices as well along the way so that we, we really are thinking about how we're differentiating ourselves when everyone can build at the speed of AI, right?

Host: It always sounds so easy, right? Just say no. But you know, like when you remember back and at Huddle, right. I, I am sure that every feature, every functionality, somebody said like, oh, this must be a great idea. Like and um, you know, like in that bet, you know, many people who listen to that are in the same situation. Stakeholder comes around and says, ah, great, uh, idea yesterday, you know, during shower, I have great ideas this morning, you know, enlightening struck me we need to build xyz. How do you deal with that?

Martin Ericsson: I think, I think that is the biggest challenge for product, right? Is because there's always great ideas and all of these ideas are good ideas. Like they're, they're not bad ideas, right? All the stuff we're doing at Huddle was probably a good idea, right? I, I write about it as like we had a good vision, it was a good idea, but we just did it in the wrong order. Right. Um, if I could go back 2020 hindsight, I would Just focus, right? I would like, okay, what's the most important thing? Like again, thinking more strategically. I didn't have some of this vocabulary or thinking back then, but what, uh, you know, where would we play? How would we win? Let's identify a market. Let's, you know, how are we going to win there? Maybe not file sharing, because Dropbox and Box were already ahead of us. Maybe Chat actually, because that was, you know, Slack didn't exist then, teams didn't exist then. Like that didn't even exist. So maybe that would be a wedge and then do a really, really good job of that. Uh, then you can start thinking about, okay, what's the next thing we need to add on or the next market we want to go after. So for me, strategy is all about focus, right. It's really about making sure that the team is focused on one, one core customer problem and making sure that we do the best job of that. And I think if you look at every successful company in the past 20, 30, you know, probably hundreds of years, like they pick a focus and they get incredibly good at it. Right? Dropbox and Box, one example, Google with search, another example. Like, you build a really strong core in that and then you can build from that. Right? There's nothing wrong with building more things, building new product areas, taking on new ideas, but only once you kind of won in a space and you have security and, or profitability and all those things, product market fit so that you can actually go into that next market or into that next product. So for me it's really about focus and it's really making sure that like, yes, that new idea is really cool, interesting, smart, solve the customer problem. Is that more valuable than doing more on the existing idea? Right. And I think that's the trade off we don't often make. We're always like, oh, new shiny thing, new shiny thing, new shiny thing. Let's do all the shiny things. Instead of really challenging. Like, actually maybe we should say no to the shiny thing and just make sure the file sharing actually works so much better by adding more platforms or adding more features or whatever that thing is that's going to get us over and break out success like Dropbox and Box did. Right.

Host: Well, but the shiny thing is always like a promise, uh, to a better future. Right. So, um, you know, like just, you know, reflecting. I hear that, but I just understanding even more or make it more. Yeah. That people can, can relate to it and say like, okay, now, now I know better what I, what I do because, you know, like at, um, all. I mean, you made the file sharing and then you went into other categories, right. You thought, okay, the other category will, will be shinier for you and more promising in terms of profit, users and so on. Right. So what is, you know, it's not even a question, right. Just thinking about it. Okay. Like, because in the situation it's really hard to say, okay, no, we don't gonna do that. Right. Even, you know, it's even Challenger, uh, Challenger if you're not in a leadership level. Right? Yeah, so I hear you. Um, still hard.

Martin Ericsson: It's not easy. I'm. I'm not going to pretend it's easy. But yeah, I think the, the distinction for me is we didn't do any of those things well enough. Right. Uh, because we were trying to do them all at once with a small. Like we had three squads. We had, you know, it was a small team, you know, and we were doing, we thought we were doing okay on growth, but we were definitely not doing, you know, as much as Dropbox and Box. So for me it was just focus. Right. If, again, if I could go back and use those three squads to just nail file sharing, I think we would have been very competitive because we were, it was a great team. We were doing great things. We were just spread way too thin. Right. Um, and so that is the big lesson for me is just that focus, right? It's incredible what you can do when you can focus a team or several teams on one problem and really doing that well versus like, oh, we're going to do everything for everyone, right? And we're going to, we're going to be for this, you know, going back to that segment question earlier, we're going to be amazing for, you know, small businesses, but also for enterprises, but also for, you know, charities. But also like, those are different problems, different customers, they have different needs and you can maybe get there over time, but you can't do it all at once, right.

Host: How did you come up with, uh, the whole stack? Like, was that incremental development or how was.

Martin Ericsson: It was definitely like, uh, the first version looked different, so it was much more product focused. I had things like epics instead of opportunities because this is before kind of Teresa Torres had come out with her thinking, uh, around that. And so it looked different, but it was largely that structure. Um, and I gave it as a talk at a, at a leadership event in, uh, Hamburg actually. Um, and I kind of thought it was a little obvious. But it turns out again, the Q and A, the conversations after that, it was still a simplified view of the world that helped people make sense of it. Right. I think it's always the challenge with these things. I mean you mentioned earlier like this is a little simple or look, can look a little simple. Um, but that's because we're trying to represent an N dimensional, you know, complex world in a two dimensional graphic on a book. Right. Or on a slide. But um, ah, you know, some models are still helpful to make us think about the world differently and just make those, those connections. And so it's taken me about seven years from that first talk to actually hone it, think about this more differently, test it with different organizations and think about all the consequences. Because obviously as you said, like at a high level it seems quite simple. But then you get into the detail of like oh, how do we do this? Or how does this connect? Where do you, you know, when do you need a different strategy? When do you, you know, all those kind of questions took a long time to test and iterate. Uh, and so hopefully that's what's, what's in the book now as, and will continue to develop. Obviously I'm going to be sharing more and more stories and things like that as well. Uh, because I do think to your point it's, it's about how it actually lives that helps people make that connection. Right.

Host: It feels very, very um, that you. I can feel when I, when I read the book I can feel that you, you know, put a lot of thoughts and iterated a lot because it's so, so coherent and I think that's the right word. Right. It's like consistency in the whole book. Right. And um, um. Yeah, I think especially for such a topic which is a little bit, you know, soft.

Martin Ericsson: Yeah.

Host: Uh, it's, it's really hard to, to make it. Yeah. That people can actually grasp. Um, yeah. So if you listened and you like to know more, um, get the book. Yeah, I can show it again. You get it on Amazon. Uh, if you like uh, to know even more, you can come to Munich on 16th. No 15th of October. Uh, Martin will be on the Just Product conference which uh, is on 16th, but he will give a workshop on the book on 15th. So if you're in the situation that you want to get better with your strategy, you know, um, align your company better, uh, towards a vision or a strategy. I think this will be um, time and money worth spending, uh, well spent. Um. Yeah. Martin, thank you very much for sharing. For sharing, for caring, for creating a huge community, uh, for being ah, um, such a significant part of the product community, like, for so many years. I really thank you.

Martin Ericsson: Just a product guy. Just trying to learn how to do this craft as a. Well, so, uh, that's. That's what drives me. But, yeah, really looking forward to Munich and the workshop as well. So hopefully see a bunch of you there.

Host: Yeah. All right, thank you very much, everybody. Bye. Bye.