# The Lean Product Playbook  ## Metadata - Author: [[Dan Olsen]] - Full Title: The Lean Product Playbook - Category: #books ## Highlights - Product-Market Fit Pyramid, breaks product-market fit down into five key components: your target customer, your customer's underserved needs, your value proposition, your feature set, and your user experience (UX). ([Location 537](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=537)) - The Lean Product Process consists of six steps: Determine your target customers Identify underserved customer needs Define your value proposition Specify your minimum viable product (MVP) feature set Create your MVP prototype Test your MVP with customers ([Location 548](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=548)) - <http://slideshare.net/dan_o/presentations>. ([Location 579](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=579)) - Tags: [[orange]] - “Product-market fit means being in a good market with a product that can satisfy that market.” My definition of product-market fit—which is consistent with his—is that you have built a product that creates significant customer value. This means that your product meets real customer needs and does so in a way that is better than the alternatives. ([Location 626](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=626)) - In business, there is a distinction between creating value and capturing value. In order to capture value, you must first create it. ([Location 634](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=634)) - Product-market fit lies between the top and bottom sections of the pyramid. ([Location 646](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=646)) - A market consists of all the existing and potential customers that share a particular customer need or set of related needs. ([Location 652](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=652)) - Different customers within a market choose different solutions to meet their needs. ([Location 656](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=656)) - The Product-Market Fit Pyramid separates the market into its two distinct components: the target customers and their needs. The needs layer is above the target customers layer in the model because it's their needs that are relevant to achieving product-market fit. ([Location 667](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=667)) - A product is a specific offering intended to meet a set of customer needs. ([Location 676](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=676)) - The real-world manifestation of software products that customers see and use is the user experience (UX), which is the top layer of the Product-Market Fit Pyramid. ([Location 682](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=682)) - The set of needs that you aspire to meet with your product forms your value proposition, which is the layer just below “feature set” in the Product-Market Fit Pyramid. ([Location 688](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=688)) - To achieve product-market fit, your product should meet underserved needs better than the competition. ([Location 698](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=698)) - “follow me home” concept, where Intuit employees would go to retail stores, wait for customers to buy a copy of Quicken, and then ask to follow them home to see how they used the software. ([Location 711](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=711)) - Figure 1.2 The Lean Product Process ([Location 725](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=725)) - A key concept in Lean manufacturing, which inspired Lean Startup, is the concept of rework: having to spend time fixing something that you did not build correctly the first time. Minimizing rework is a key tactic for eliminating waste. ([Location 755](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=755)) - separating problem space from solution space. ([Location 777](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=777)) - Tags: [[blue]] - Any product that you actually build exists in solution space, as do any product designs that you create—such as mockups, wireframes, or prototypes. Solution space includes any product or representation of a product that is used by or intended for use by a customer. ([Location 779](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=779)) - problem space is where all the customer needs that you'd like your product to deliver live. You shouldn't interpret the word “needs” too narrowly: Whether it's a customer pain point, a desire, a job to be done, or a user story, it lives in problem space. ([Location 783](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=783)) - having a clear understanding of the problem space (devoid of any solution space ideas), allows for a wider range of creative solutions that potentially offer a higher return-on-investment. ([Location 796](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=796)) - “market disruptions”: when a new type of product (solution space) better meets the market needs (problem space). ([Location 829](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=829)) - You've got to start with the customer experience and work backwards to the technology. You can't start with the technology and try to figure out where you're going to try to sell it.… As we have tried to come up with a strategy and a vision for Apple, it started with: What incredible benefits can we give to the customer? …Not starting with: Let's sit down with the engineers and figure out what awesome technology we have and then how we're going to market that. And I think that's the right path to take. ([Location 872](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=872)) - Note: Quote from Steve Jobs. This can be used to counter when someone says that Jobs never asked the users what they wanted. - It's therefore the product team's job to unearth these needs and define the problem space. One way is to interview customers and observe them using existing products. Such techniques are called “contextual inquiry” or “customer discovery.” You can observe what pain points they run into even if they don't explicitly mention them to you. You can ask them what they like and don't like about the current solutions. As you form hypotheses about the customer needs and their relative importance, you can validate and improve your hypotheses using these techniques. ([Location 923](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=923)) - The best problem space learning often comes from feedback you receive from customers on the solution space artifacts you have created. ([Location 931](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=931)) - Problem space and solution space are an integral part of the Product-Market Fit Pyramid, ([Location 933](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=933)) - The important interface between problem space and solution space occurs between your value proposition and your feature set. ([Location 935](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=935)) - “Customers don't care about your solution. They care about their problems.” ([Location 941](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=941)) - Different customers will have different needs—and even those who have the same needs can have distinct views on their relative importance. ([Location 951](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=951)) - Matching a product with its target customer is like fishing. Your product is the bait that you put out there and the fish that you catch is your target customer. Sometimes you catch the type of fish you were going after and sometimes you catch a different type of fish. You can develop hypotheses about your target market, but you won't truly know who your customers actually are until you throw your hook into the water and see what kind of fish bite. Once you have a product or a prototype to show customers, then you can gain clarity about the target market you're attracting. ([Location 955](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=955)) - You define your target customer by capturing all of the relevant customer attributes that identify someone as being in your target market. These attributes can be demographic, psychographic, behavioral, or based on needs. Dividing a broad market into specific subsets based on attributes is called market segmentation. ([Location 973](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=973)) - the technology adoption life cycle, ([Location 1028](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1028)) - Alan Cooper championed the use of personas as part of his “Goal-Directed Design” process. ([Location 1054](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1054)) - as each person works on their own, independently making lots of little product decisions, personas should make the results more congruous and additive instead of discordant and counterproductive. ([Location 1065](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1065)) - What Info Should a Persona Provide? ([Location 1068](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1068)) - Tags: [[blue]] - “customer discovery” interviews. ([Location 1100](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1100)) - a persona should be pragmatic and provide useful information that can help inform product design decisions. ([Location 1110](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1110)) - Some people within your customer base will like your product more than others. Those people likely use it more frequently and recommend it to others, which you can see on social media. Talking with those passionate customers can especially help sharpen your hypotheses about your target market and gain insights into what underserved needs your product is meeting for them. ([Location 1124](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1124)) - identifying what needs they have that your product could satisfy. ([Location 1134](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1134)) - There are unarticulated needs—those that the customer has but doesn't express in an interview. ([Location 1140](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1140)) - Good interviewers excel at listening closely to what customers say, repeating statements back to ensure understanding, and asking additional probing questions to illuminate the problem space. ([Location 1143](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1143)) - some people perceive a need as critical, whereas desires and wants are just “nice-to-haves.” ([Location 1147](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1147)) - A pain point is just a customer need that is not adequately met, resulting in customer dissatisfaction. ([Location 1157](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1157)) - One of the easiest ways to tell that a product team is starting with the solution space is that instead of articulating customer benefits, they list product features. ([Location 1181](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1181)) - Once you have an initial set of hypothetical customer benefits you feel good about, it's time to test them with users. The best way to do so is via one-on-one, in-person customer discovery interviews. ([Location 1190](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1190)) - You'll find when conducting customer discovery interviews that different customers can use different words to describe the same idea. You will also find that statements made by customers can vary quite a bit in how high-level or specific they are. ([Location 1223](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1223)) - As you talk with customers, you can keep asking them, “Why is that important to you?” until it doesn't lead to any new answers. This helps elevate the discussion from more granular, detailed benefits to higher-level benefits. ([Location 1229](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1229)) - Originally developed by Toyota, the Five Whys is an iterative question-asking technique to explore the root cause of a problem. ([Location 1255](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1255)) - Maslow's Hierarchy of Human Needs ([Location 1261](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1261)) - Figure 4.2 Olsen's Hierarchy of Web User Needs ([Location 1281](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1281)) - prioritizing based on customer value is a good approach. ([Location 1301](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1301)) - When discussing innovation, it's common to distinguish between disruptive innovation and incremental innovation. ([Location 1375](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1375)) - The iPod was a disruptive innovation that yet again redefined the satisfaction scale for portable music listening. ([Location 1404](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1404)) - how to measure values for importance and satisfaction. The easiest way to think about this is a question that you ask your customers (or prospective customers). You can ask the question in person or in a survey. ([Location 1419](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1419)) - it is generally agreed that 5-point scales are best for unipolar and 7-point scales are best for bipolar ([Location 1447](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1447)) - I often hear people say that they're building a new product and don't yet have a customer base that they can survey. They're concerned about not being able to reach enough customers to achieve statistical significance. But even if you can't easily reach thousands of people, you can still obtain meaningful results. ([Location 1468](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1468)) - too many product people have convinced themselves that they need to prove things beyond a shadow of a doubt. That's just not the case ([Location 1481](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1481)) - The Lean approach is all about articulating clear hypotheses and then designing tests to determine if they are valid. ([Location 1486](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1486)) - Gap analysis and jobs to be done both use importance and satisfaction to quantify the size of different product opportunities to inform your prioritization. ([Location 1494](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1494)) - Central to Ulwick's methodology is the idea that customers buy products and services to help them get a task or job done. Customers decide which product to buy based on how well it delivers their “desired outcomes” for the “job to be done.” Clayton Christensen and others have also promoted this approach, commonly referred to as “jobs to be done.” ([Location 1521](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1521)) - In order to identify innovative solutions, the product team needs to create a rich definition of the problem space. ([Location 1528](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1528)) - Steve Jobs shared a similar view, saying: When you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there. But if you keep going, and live with the problem and peel more layers of the onion off, you can oftentimes arrive at some very elegant and simple solutions. Most people just don't put in the time or energy to get there. ([Location 1535](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1535)) - Figure 4.5 Visualizing Customer Value ([Location 1550](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1550)) - Figure 4.8 The Kano Model ([Location 1622](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1622)) - Must-have needs don't create satisfaction by being met. Instead, the need not being met causes customer dissatisfaction. ([Location 1630](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1630)) - Needs migrate over time. Yesterday's delighters become today's performance features and tomorrow's must-haves. ([Location 1645](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1645)) - your product must be competitive on performance features before delighters matter. You can think of this as a three-tier pyramid with must-haves on the bottom, performance features just above that, and delighters at the top. ([Location 1651](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1651)) - A good product is designed with focus on the set of needs that are important and that make sense to address together. Swiss Army knives are incredibly useful, providing a set of tools to address a wide range of needs all in one convenient package. But at some point, as you add more and more tools, a Swiss Army knife gets wider, heavier, less usable, and less valuable. Focus is critical when defining a new product. ([Location 1672](https://readwise.io/to_kindle?action=open&asin=B00SZ638C8&location=1672))