Building Products For Maximum Impact

We recently hosted a webcast conversation between Vasily and Elliot focused on how organizations can “build products for impact.”

Don’t have time for the full webcast now? Below you can catch the highlights and tips from their talk in our companion blog.

If you’d like to read the full transcript of Elliot Susel’s conversation with Vasily Starostenko, you may download it.

Building For Impact: You Want 99 Problems And These 3 Clear Steps

Vasily Starostenko loves problems. Today he leads the customer acquisition team at Tesla, and before that he was a product manager on the driver team at Uber. At both companies he’s learned that successful products start with a relentless focus on solving customer problems.

Vasily developed his appreciation for problem solving in 2003 when he went to work for Telefone, a small startup in Russia. The company solved an important issue even for Vasily: He could not afford to call home. “I came from Siberia to study in Moscow and a single minute of a phone call was quite comparable to my whole scholarship,” Vasily told Lean Startup Co. faculty member Elliot Susel in a recent webcast. The experience of working on a product that improved lives inspired Vasily to keep building for impact.

Not surprisingly, Vasily defines “impact” as trying “to solve the customer problem” and “to make people’s lives better,” a goal that he recognizes can be complicated. But, based on his experience working for both early stage startups and large scale operations like Uber and Tesla, Vasily has simplified building for impact into three steps: 1) Understand 2) Experiment 3) Align. Below we outline Vasily’s steps in more detail, along with other important insights from our conversation.

Understand: Avoid Feature Fetish by Starting with a Problem Statement

Vasily knows that it is easy for companies to succumb to feature fetish: “When we just launch a feature and we celebrate the feature launch, it often happens that we do not even ever explicitly talk about what problem was it launched to solve? And what problems has it actually solved?” If you can’t answer these questions, then you’re probably not building sustainable products.

A simple way to ensure you’re focused on customers, not features, is to start the product cycle with an “explicit problem statement,” and it should be “from the customer’s standpoint,” not the company’s, “because your company exists and your product exists to satisfy the customer need,” shares Vasily. For example, the dilemma should not be how the company can grow new users by 20 percent because “customers maybe want your company to stay alive and offer good products, but they don’t really want the company to grow.” Growth is not a customer need.

But, what do customers need? Identifying the right (and real) customer problem is not easy. “It’s important to identify the problem. But how you do it? There is no clear winner,” Vasily admits. He does, however, have a few suggestions. First, he recommends exploring at least 50 problems before deciding to solve one. He also thinks that the Double Diamond design model is effective for helping teams to decide where to focus.

“When we just launch a feature and we celebrate the feature launch, it often happens that we do not even ever explicitly talk about what problem was it launched to solve? And what problems has it actually solved?” Click To Tweet

Experiment: “Always Have a Hypothesis,” But Don’t be Blinded by Science

You may think you’ve identified a clear problem, but as Vasily has learned “sometimes you’re discussing a problem that doesn’t even exist.” To avoid solving phantom problems, Vasily emphasizes that you must “always have a hypothesis.” A hypothesis forces you to focus on what you anticipate outcomes to be if you have correctly identified a problem, and those outcomes should be measurable.

To measure, you must identify metrics that you will use to determine if the product test was successful. And, Vasily says that you must label every experiment a success or failure, or as he says, every experiment must be “called.”

And even though “calling” an experiment relies heavily on quantitative evidence, Vasily stresses that you can’t be too focused on numbers. “Data shows you the past. So to grasp the future, you need to be always thinking of qualitative measures. Talk to your customers. Figure [out] what happens in customer support.”

To prove his point, he recounts his experience trying to encourage Uber drivers to drive more hours. His team developed a feature that asked “Are you sure you want to go offline?” and motivated drivers with messages such as “You’re 15 minutes short of 5 hours” or “If you finish right now, you will finish at trip number 9. How about you drive one more trip?” Vasily remembers that “people as a result drove way more,” but ultimately the feature was discontinued because even though some drivers were driving more, many were annoyed by the feature.

“So the number of hours you drive is actually not the right success metric because it’s just showing you at the moment what’s happening. It’s not showing you what’s gonna happen tomorrow. What if all these annoyed people, tomorrow, just don’t come?” Vasily explains that a simple way to ensure that you hear from customers that may be frustrated by a feature is to include a way for customers to let you know, “I hate this feature.”

A net promoter metric is one way to measure customers’ love (and hate) for a new product, but ultimately, Vasily says, “As much as you wanna build science, the human judgment cannot be replaced by just a set of processes.” You want to be sure you have a product team with “good judgment” and that you “talk to your customers all the time.”

“Data shows you the past. So to grasp the future, you need to be always thinking of qualitative measures. Talk to your customers. Figure out what happens in customer support.” Click To Tweet

Align: Put Your Money Where Your Mouth Is

Alignment is designing your organization around having the impact you’ve validated with experiments, or as Vasily describes, putting your money where your mouth is. He provides the example of Uber: “Uber has a driver team and a rider team. And it kind of makes sense because there are drivers, and there are riders. And… when I was there, the growth team stopped to exist.” Drivers and riders were prioritized.

Prioritizing and planning help build an organization aligned for impact. Vasily is quick to quote Mike Tyson, “Everyone has a plan until they get punched in the face,” but, he says, “Still have a plan.” Vasily believes that the planning process helps organizations prioritize and avoid internal miscommunication. “When there’s multiple teams, those teams often clash around, should I be solving this problem or should you be solving this problem?” The plan will help you “figure out which team is solving which part of the customer need.”

And, once plans and priorities are established, the punches will come, and things will change, but staying focused on the customer problem should help keep your teams aligned. Vasily is “always explicitly discuss[ing] what problems we are solving” even “with every single non-product and non-tech team that I engage.” He believes that “when it’s obvious [that] I’m trying to make my customers happier by doing this, it’s more likely to get unchanged to the ultimate team which will be implementing it.” Vasily says, “Communication straightens out in your organization when you talk about problems.”

Thanks to Misti Yang for contributing this piece. If you seek to bring the entrepreneurial spirit to your organization, Lean Startup Co. can help.


Also published on Medium.