In our work all around the world, we often need to address the question of what are the strategic measures of success for Product Development projects…
It’s hard to know how to get somewhere if you don’t know where you want to go… The same thing applies to effective Product Development. Any new investment by a business needs to be measured against a target or set of goals. And the time to do that is not once you have started the journey, but before you start. And in Product Development, that generally means as part of the business case development.
These measures of success can be various – and really depend on the nature of the product development project and key driving factors.
So as a first layer your success measure may include business level success criteria such as:
- Revenue growth initiatives
- Revenue protection initiatives
- Customer service improvements
- Operational process or systems changes
- Mandatory technical, legal or similar requirements
Assuming your initiatives will fall in one of the above (some may fall in multiple categories) you will ideally expand on each of the categories to further articulate your strategic objectives. Let’s follow through with some examples:
|Main Objective||Sub-Objective Examples:|
|Revenue growth initiative||.
Margin growth (profitability growth), EBIT growth…
Market share growth from X to Y
|Revenue protection||Protect revenue of product X by selling product Y (stickiness)|
|Customer service improvements||.
NPI score increase of X%
Customer satisfaction rating increase of X%
Customer service installation time improvement by…
Customer help desk wait time reduced by…
|Operational / process change||.
Retirement of old product
Migration of customers from platform X to platform Y
IT systems change to reduce platform downtime by X%
|Mandatory etc…||Government rule around product structure, ingredients, price etc…|
Each of the above objectives should ideally be substantiated and quantifiable eg. for market share growth you must know your existing market share, your competitors market shares, overall market growth % and your expected/projected growth trajectory. Always test your projections by looking at it from the total market perspective and your competition perspectives. So if market is growing at 10% and your competitors are growing at 10% also, you really must grow at above 10% in order to take market share if that is your main goal.
Second layer view you may want to consider, would be at a slightly lower level – being the product success measures.
In this case your strategic considerations and success factors for product development could include:
- Improved pain for user (with some scale for example from 0 to 10)
- % of impacted customers
- Up-sell from existing customers as a %
- Revenue from new customers
- New product differentiation feature
- Competitive necessity (competitor response feature)
And finally at the third layer you would have project success measures such as:
- Did you meet your planned project development time-frames
- Did you meet your agreed budget
- Was product delivered with suitable quality including all the required features
So hopefully by combining some of the above business, product and project level success measures, you will be able to get a good feel of your success.
And remember, if you can’t measure it, you can’t manage it. It’s critical that with any new Development, you can quantify if you are track to achieving what you set out to achieve up front. If things do go off the rails, good tracking of measures of success means you can address issues early before it ends in a train wreck!
If you would like to learn more about bringing something like this to life in your organisation, consider Parcus Group’s Product Development Training courses.