How to Define Your Product Strategy: A Guide to Building Enduring Value and Increasing Productivity

How to Define Your Product Strategy: A Guide to Building Enduring Value and Increasing Productivity

In today's fast-paced business landscape, defining a solid product strategy is crucial for success. It goes beyond simply satisfying customers; it's about delighting them in hard-to-copy, margin-enhancing ways. This concept became clear to me when I joined Netflix in 2005. I learned that strategic thinking is the key to accelerating progress and building enduring value.

But how can we achieve this level of strategic thinking? Let's take a step back and explore the forgotten science of productivity, which holds the key to being 50x more productive without working more.

Back in 1911, management genius Frederick Winslow Taylor made a groundbreaking discovery. He found that by optimizing the production process, the productivity of manual workers in manufacturing increased fifty-fold. This achievement paved the way for the economic and social gains of the 20th century. However, as we entered the knowledge work era, productivity growth stagnated.

Today, knowledge workers waste a third of their day on activities that could be reduced or eliminated altogether. This inefficiency not only hampers individual productivity but also affects society as a whole. Productivity is a determining factor in the adoption of government policies and societal stability. High productivity leads to higher incomes and more leisure time for workers, while low productivity can lead to unrest and revolutions.

To increase productivity in the knowledge work era, we need to apply the principles of scientific management, as pioneered by Taylor. This means optimizing the process first before relying on technology to accelerate productivity. It's about questioning and codifying best practices, training employees in the most scientifically tested approaches, and eliminating information overload.

Developing a deep productivity mindset requires time and effort. It involves refining the research process, continuously learning and improving, and surrounding yourself with like-minded individuals who embrace long-term, probabilistic thinking. Building a solid product strategy is akin to building a factory – it's about creating a well-oiled machine that can consistently deliver value to customers.

Now, let's dive into three actionable pieces of advice to help you define your product strategy and increase productivity:

1. Embrace strategic thinking: Shift your focus from simply satisfying customers to delighting them in hard-to-copy, margin-enhancing ways. Think ahead and build enduring value by articulating a clear set of hypotheses for achieving customer delight.

2. Optimize your process: Take a page out of Frederick Winslow Taylor's book and optimize your production process before relying on technology. Question and codify best practices, train employees in scientifically tested approaches, and eliminate information overload to improve efficiency.

3. Foster a deep productivity mindset: Invest time and effort in refining your research process, continuously learning and improving, and surrounding yourself with individuals who embrace long-term, probabilistic thinking. Building a solid product strategy requires a team effort and a commitment to long-term success.

In conclusion, defining your product strategy is crucial for building enduring value and increasing productivity. By embracing strategic thinking, optimizing your process, and fostering a deep productivity mindset, you can set yourself and your team on the path to success. Remember, productivity is not just about working harder – it's about working smarter and finding innovative ways to deliver value to your customers. So, let's redefine productivity and unlock our true potential.