The Product Pulse

Allow me to pose the question again, but this time as a multiple choice question:

How is your company using social media?

1. As a hip way to fill business cards and e-mail signatures with nifty and icons
2. To communicate to employees and customers
3. To transform and broadcast media monologues into social media dialogues (Wikipedia)
4. As a powerful platform to drive new, innovative products into the market

Take a moment to select the answer that best describes your organization. And be honest -- no one's watching. Go ahead… I'll wait.

If you answered "D" and you really, really mean it, allow me to lay down the gauntlet to put your company to the test. My good, wicked-smart friends at Kalypso have issued a challenge for all of you product development companies out there… a competition, in fact. Allow me to introduce you to the first annual Spike Awards to recognize the best use of social media and social computing to improve innovation, product development and product management. Spike Awards will be given to companies in four categories: Technology, Life Sciences, CPG, and Manufacturing. Nominees will be measured on the quality of their responses and how creative their social media solution was in solving the business problem. So, put your money where your mouth is and submit your entry today -- nominations must be in by Friday, September 3, 2010.

Winners will be announced on October 19th at PDMA's Annual Global Conference on Product Innovation Management. This conference always delivers meaty content and presents incredible networking opportunities. And with the presentation of the Spike Award winners, setting the example of how social media can be used to drive innovation into the pipeline, this conference should not be missed! See you there!

When Kent Beck first articulated the principles of agile programming, he spearheaded the greatest change in software methodology in the last twenty years, and therefore perhaps of all time in such a young art.

As I cannot hope to improve upon his exposition of the synergetic principles of Extreme Programming, I would like to explain how agile programming relates to Portfolio Management and in particular to the critical need to give executives transparency into the status of a software project.

As Pat Durbin and Terry Doerscher write in Chapter 2 of their recent book Taming Change with Portfolio Management under the heading "The Elusive Nature of Knowledge Work":

Knowledge work is difficult to plan, estimate, and complete. Unlike physical work such as construction or component assembly, knowledge-based activities are often one-of-a-kind endeavors with no direct historical comparison for estimating purposes. Knowledge-based work also lacks discernable indicators of progress.

The concept of Velocity in Extreme Programming, or Agile Programming, is an attempt to provide a discernable indicator of progress for software projects.  It answers a simple but critical question for an executive of a software company:

How close to being done are we?

Therefore it allows the more interesting question to be answered:

What is the best compromise between what we want (our demand) with what we can do in a period of time (our capacity)?

Velocity is the amount of work completed by a team in a fixed, but repeating, period of time, called a Sprint. At Planview we use two-week sprints. However, the complexity of programming tasks, called Stories, varies widely, so you cannot simply count up the tasks. Rather, you measure the complexity of a completed task in an abstract measure. At Planview we call this measure Story Points, but you could call them "complexitrons" or anything you like. Every task must be consistently estimated in these Story Points.

If you measure the number of Story Points completed in several sprints by a particular team, you have the best measure yet devised for predicting how much work will be successfully completed in the next Sprint by that team. If you have all tasks estimated in Story Points, you can predict, with reasonable accuracy, when the project will be done. To an executive, portfolio manager, or project manager, this transparency enables good decision-making.

There are, however, some subtle keys to Estimation, Story Points, and Velocity that experience has taught us:

• The whole team participates in estimation.
• The estimate of a story must never change once it is decided. Time may show that the estimate is wrong, but to change the estimate is like telling a debtor he owes twice as much as previously agreed for no reason.
• A story may be split into smaller stories, but the Story Points, like money and energy and momentum, must be conserved.
• Estimates made quickly, relying on the ineffable thoughts of a skilled programmer, are about as good as detailed estimates.
• Expect velocity in any given sprint to vary about 40% around a multi-sprint average.
• Story writing is an art, but it is not a black art. A team and their product manager should be able to write 15 reasonable stories in an hour. Perfection is no better than "good enough"-ness. Do not allow the perfect to become the enemy of the good.
• When programmers disagree on estimates, resolve the disagreement by consensus and discussion.
• "Done" means "Releasable". A task is not done until it is releasable. You may not be willing to ship a single story, but if that story is not done to the level of quality your customers demand, it just doesn’t count

It was an impressive turnout at ProductCamp Austin (PCA) this weekend. Here’s the breakdown:

• Close to 700 people registered for the un-conference
• More than 500 people actually showed up… on a SATURDAY (that is dedication!)
• Roughly 50 sessions were offered up for voting by campers on a variety of topics
• A total of 35 sessions were delivered
• And the winning presentation was: "How to be a Product Marketing Genius, Ninja, Guru Rock Star, Wizard…"

While it didn’t win best presentation, the session that put the most nuggets in my pocket to take back to the office was by David H. Friedman titled: "What Engineers Wish Product Managers Knew." I always knew there was a fundamental difference between my brain and that of my favorite Development Manager, but this presentation spelled it out for me in black and white: they are right-brain thinkers and I am a left-brain thinker. We are wired in completely different ways! Dr. Friedman spelled out for me where Engineers excel, where they struggle, what motivates them, and how I can successfully work with them. I feel like I’ve received the keys to the kingdom! With this knowledge, my product is going to take off and smoke the competition! Intrigued? Check out his presentation and blog at his website.

There were other great sessions that were offered, but with only 5 available slots, I know I missed some good stuff. Luckily, PCA takes advantage of technology in every aspect and all presentations from the day can be viewed at the ProductCamp Austin website.

Already looking forward to the next two PCA events:

• January 15, 2011
• August 6, 2011

If you need an energy boost, I highly recommend you plan to attend!

Throughout my career, there have been a few examples of good business partnerships -- partnerships that are truly beneficial for both sides. I have many more examples of "Barney" type partnerships that take a good chunk of bandwidth for little return. The most successful partnerships, in my experience, have been built around a "build vs buy" product decision. The best example of this has been the integration platform decision -- if you are an enterprise software company, why do you want to build and own integrations? It is not your business…AND the infrastructure alone is cost-prohibitive, the resources needed to support integrations are expensive and the ability to keep up with all releases of software changes is daunting! And then throw SaaS into the mix! So one of the best decisions you can make is partnering with a good integration infrastructure provider -- and we chose Pervasive.

Any software veteran will understand that integrations are not easy -- our jobs as software providers are to make this as easy as possible. One can argue that the hardest part of integrations is to "talk" to the other applications, databases, ESB, etc. Once this connection has been established, the mapping of one field to another is much easier. This is the approach that Pervasive has taken -- they provide 200+ connectors out of the box and an easy interface to do the mappings. Since we embed Pervasive's technology in our software, all we have to worry about is building and maintaining web services around our product.

I attended the Pervasive Metamorphosis 2010 Conference a few weeks ago (I also had the privilege of speaking at the event -- hear for yourself what I had to say here) and it was amazing how many similar success stories I heard around the "build vs buy integration" decision and the documented achievements that had been realized. The show was very interesting in many aspects, especially hearing the vision of integration technology and how far along "integration in the cloud" has come. My advice to anyone looking at this integration "build vs buy" dilemma: stick to your core competency and let the experts do integrations!

I've never met a homebuilder who wants to build a roof before pouring a foundation. Yet when I talk with executives about optimizing their product development portfolios for customer appeal, competitive impact, and resource allocation, they sometimes ask this question first: how can we do a better job of optimizing development investments across our major lines of business? That's essentially the roof of the portfolio.

This recently came up in a conversation with an iconic financial services company that wanted to improve how development resources are allocated across its retail banking, commercial banking, retirement, and insurance businesses. Of course, the C-suite of every diversified enterprise in any industry must concern itself with such issues. But sequence is critical. And in this case, the sobering reality was that there was more work to do to optimize new product development resources within each business unit before they could possibly optimize across units.

It's a paradox that this is obvious and yet so often ignored: the only way to optimize a company's product development spend is to first optimize it at every intersection of a product line and a target market segment. At each of those intersections is a set of needs and attributes that drives whether a customer chooses Product X vs. Y. When the development pipeline is optimized at each intersection, only then is the company able to optimize across multiple portfolios and business units by working with building blocks that are already optimized.

Like building a house, portfolio optimization is necessarily a bottoms-up discipline. Where there is excellence in product development prioritization and resource allocation at each segment-product intersection, senior management can be much more confident in optimizing across all product lines, customer groups and, ultimately, across business units -- knowing that each brick in the corporate product development house is, on an ongoing basis, an optimized brick.

Hey ya'll, it's almost time for ProductCampAustin's Summer 2010 event on August 7th! Those of you who read my posting on the last one know what a great event this is. Lots of great brains, lots of fun -- no bs, no sales. It's a great place to get fresh ideas when you're feeling stale. Those of you who haven't been yet -- you're missing out. Hope to see you there!

Learn more and register at the ProductCampAustin Web site.

If you're involved in New Product Development, then you're likely using some sort of gated method to manage your product development process. And if you're using a gated process, then you've surely heard of Stage-Gate. And if you've heard of Stage-Gate®, then you know all about THE de facto expert on the process: Dr. Robert Cooper, founder of Stage-Gate International. (Before I continue with this blog post, I must be completely transparent and make a confession: I have a secret, professional crush on Dr. Bob's brain. The man is brilliant, dynamic, extremely engaging during his training classes, and definitely crush-worthy. So yes, I'm biased!) Dr. Cooper has written numerous books, along with his business partner, Dr. Scott Edgett, on the topics of product innovation, NPD, and product portfolio management. These guys definitely know what they're talking about.

To help organizations implement and automate this methodology, further reinforcing recommended best practices, Stage-Gate has created a set of detailed criteria that software vendors must demo to prove that their solution is Stage-Gate Ready. The 200+ certification criteria focus on the areas of idea management, the idea-to-launch process, and portfolio management. The criteria are challenging and the certification process is grueling (trust me, I know). Stage-Gate upped its game by introducing an additional set of 30 criteria (version 2), with more coming towards the end of 2010 (presumably, version 3).

The new criteria do a terrific job of diving into some critical aspects of managing a gated process, including:

• Post-launch review
• Product roadmapping
• What-if analysis on the portfolio
• Portfolio optimization (computing the efficient frontier)

These features are absolute "must-haves" in order to ensure your company's products are successful in the market and drive revenue.

Additionally, I applaud the folks at Stage-Gate for the amount of attention they placed on portfolio management reporting and analytics in this new version of the certification criteria. New reporting-and-analytics-focused criteria include:

• Dashboards for reviewing In-Process Performance
• Graphically illustrating an actual pipeline of projects
• Graphically illustrating a portfolio for Strategic Buckets

Having helped many companies implement portfolio management processes and solutions, I know that focusing on the desired outputs clearly defines the necessary inputs. But unfortunately, some people get caught up in the excitement of putting data into the system, instead of what type of data they want to get out of the system for effective decision making; analyzing the data, not entering the data, should be the focus. These new criteria will hopefully get companies on the right path.

There were two new criteria added to the Idea Management section of the evaluation, but they weren't earth shattering. This is a big bummer because there is a lot of talk right now around using innovation and ideation to better feed the product pipeline. It's the front end of the funnel and the old tricks of the employee suggestion box simply don't really cut it in the "new normal." Hopefully (wink-wink, nudge-nudge, Dr. Bob), more emphasis will be placed on this section in the next version of the criteria.

About a month ago I participated in the Frost & Sullivan 6th Annual Global Innovations in New Product Development Conference in Anaheim, California, home of that hallowed House of Mouse, Disneyland. Like many of you, I've experienced more conferences, summits, huge trade shows, user conferences, etc., etc., ad nauseam, than I care to remember. Few stand out as exceptional. This event, however, did exactly that.

It began on a high note with a networking breakfast chock-full of leaders of innovation and new product development. Also, Frost & Sullivan did a great job of organizing the event and truly making it interactive. Everyone was a participant, not just an attendee. Sponsors, keynotes, and attendees all came together as equals, eager to share, collaborate, learn, and make new connections.

There was a wealth of content about driving innovation, measuring the maturity level of a company with regards to capturing and managing the voice of the customer, breakout sessions and general sessions that demonstrated what these leaders are doing today to drive innovation and accelerate product development in their organizations.

While many of the presentations I heard were valuable, the one that truly stood out was from Malcolm De Leo, Vice President of Innovation at Daymon Worldwide.

Malcolm is an engaging presenter and has transformed the culture at Daymon Worldwide with his "from Innovation to Activation" approach. With a goal of making Daymon more innovative to drive partnerships, value and ultimately more revenue, Malcolm's approach makes innovation a truly collaborative effort by decentralizing the teams and creating a team of interacting innovators that all have a stake in the process and its success.

The process and culture change he and his team have put into action is unlike anything I have seen before. His innovation strategy is a targeted approach from culture to customer. His vision is to make Daymon the innovation network for all of its partners. A truly visionary approach but a practical one based on the work and videos he shared with the event participants.

I think every organization that really is committed to driving innovation across the enterprise can benefit from the work that Malcolm and his team have accomplished. To connect with him, just visit www.innovationmuse.blogspot.com, www.videobio.com/mdeleo, or www.twitter.com/innovationmuse.

Last week saw me traveling, which means I had some time to do a little airplane reading. I had the July/August edition of the Harvard Business Review with me and read a few thought-provoking articles.

The first is titled "The Execution Trap." A lot of good thoughts but the main thread is that there should not be an organizational hierarchy when it comes to the segregation of strategy and execution. In fact, segregation is the problem -- employees at every level of the organization should feel empowered to drive strategy as well as execution. Strategy should not be the exclusive domain of executives, but should permeate the entire organization. We should all strive to build cultures that promote the extinction of the "choiceless-doer" (author's term), i.e. the individual contributor that simply executes what they are told. Here, here.

The second article, "Stop the Innovation Wars," in some ways takes an alternate perspective. The authors advocate that driving innovation demands the creation of "innovation teams" that are chartered to break new ground. These teams then propagate their innovations into the core operations (or "performance engines") of the firm to bring the innovation to life.

Should innovation be more like strategy as in the first article? Shouldn't innovation exist in every aspect and every employee in the firm? I tend to think so, but there are some examples in the second article that show that the "teams" approach has merit.

Interesting reading, check out these articles if you get the chance and let me know what you think.

Back in May, I was in Boston for the Front End of Innovation Conference, and also to meet with Dr. Brian Glassman, PhD Innovation Management. Battling a head cold from Austin to Boston, the first point of order before racing down to the Seaport hotel was a quick stop for a hot bowl of clam chowder at Fanueil Hall Marketplace. It didn't eliminate my cold, but it helped! I met Dr. Glassman on the exhibit floor and I discovered that he, too, was suffering from a cold. Must have been that time of year.

After we discussed the Advanced Ideation webinar we were working on, the bells chimed and the announcer let us know it was time to make our way into the next General Session. I was excited to attend this particular presentation as it featured Xerox, a Planview Enterprise customer. The presenter was Dr. Sophie Vandebroek, CTO Xerox & President Xerox Innovation Group who presented "Technology Led Innovation, Tapping What's Next."

What stood out in this presentation was the blending of technology with Xerox's actual customers to help drive their innovation process. The company has definitely spent a lot of time framing its innovation processes, not just from using cutting-edge technology to foster innovation, but by very proactively including customers in the innovation process itself. Customers' needs are the main elements in what Xerox positions as "Innovation Domains," which were Knowledge Work, Sustainability, and Personalization. What struck me was the similarity to what today's marketers do: create personas for your audience based on their functional roles within their organizations.

One section of her presentation that has us all laughing and agreeing with was when she showed old videos of users of high-end Xerox printers and copiers. "Imagine that if the machine goes down, there's a second engine that keeps running your job, so you don't have to wait for someone to fix it! You can avoid downtime and still get your job copied." The customers in the video absolutely loved this! Unlike the old "focus group" model, this was an open-dialogue format with Xerox and its customers at the same table, not hiding behind one way mirrors. They were able to gather not only the product wishes, but to test and evaluate new features in a qualitative and qualitative format to help validate new products or product enhancements: all driven from the actual customers who will be purchasing them again! It was also clear that Xerox is a highly mature and leading technology organization that relies heavily on technology and its customer base to drive the innovation process. This approach helps it achieve and defend its market leadership position and ensures it has an extremely robust and powerful product portfolio.

Another take-away from the conference itself: Innovation is HOT! More and more companies are creating innovation centers of excellence and creating new positions for people to "own" define and manage the innovation process. On the last day of the conference I was delighted to met Braden Kelley of Business Strategy Innovation. He shared some great insights about the conference and also gave me a lot to think about for the upcoming Open Innovation Summit in Chicago this August. If you're in R&D, Product Development, or Innovation, you probably already know about his blog, aptly named "Blogging Innovation." You can also find him on Twitter @innovate.

So -- did you attend FEI Boston? If so, I'd love to hear about your favorite Keynote or General Session!