Over the years, Net Promoter Score (NPS) has become the default question to measure and maximise value. But is it right? Is it true? Daniel Kinal joined us to share his thoughts.
Where did NPS come from? Back in 2003, Fred Reichheld introduced the concept to the world. He felt the current measures of loyalty were too convoluted and complicated. So he did his own study, with surprising results, even to him. What he came up with, Net Promoter Score – the one metric that was supposed to have the strongest correlation to company success.
Why should it work? The more likely you are to advocate for a brand, the more people will be willing to trial the product, therefore reducing your acquisition costs. Also, those advocates are more likely to be repeat customers and increasing their lifetime customer value. Score. Double score!
Simply irrelevant in some industries
Not predictive in a monopoly or near-monopoly conditions
Data analysed was historical, not future
Unconvincing replication studies.
Highly volatile measure
Obscures critical information
Is there a correlation? Well, yes. Is it good as a predictor for future success? Well, maybe not as much. In fact, in one study, NPS only explained 38% of future growth.
Bastardisation If you game your scores, what do you really achieve? From colour coding, nudging your scores, and filtering out negative results. What are you actually able to learn?
Is there an upside? Yes, some compelling aspects of NPS include, it is relatively cheap, fast, simple; and well accepted.
Already using NPS? Make the most of your data.
Don’t focus purely on the number.
Measure brand or full product experience rather than feature or interaction
Measure longitudinally and conduct trend rather than a point in time analysis
Keep it as scientific as you can (randomisation, third party research)
Compare your NPS to direct competitors
Remember what you are measuring (loyalty and propensity to evangelise, not product satisfaction).
Analyse the qualitative feedback
Collect actionable data too, such as customer satisfaction.
For a shorter version of Daniels’s talk please find this recording from his presentation at Web Directions. Here are the slides from the evening.
Thank you to Medibank for hosting, and all our Prod Anon volunteers for helping on the night, Nadia Gishen, Irene Toh, Marija Becker, Yau and Steve Cheah for this write-up.
In curating the speakers, she’s found there’s no shortage of local and international men keen to snap up the opportunity but female speakers are much harder to come by.
Sarah’s goal is to curate a diverse group of speakers to make it the best possible conference. Even after 5 years of LTP, it continues to be a challenge to get more female thought-leaders to agree to speak when invited, let alone respond to her call for applications to presenters.
She asked the group for their thoughts on how we can encourage more female product managers can step up and speak publicly.
We had a robust conversation which clearly highlighted that many women in the product management community would love the opportunity to present but need some support in the months and years leading up to being able to speak at a conference with a big audience.
What is holding women back from talking?
The discussion group shared their views on the challenges for women to be in a position to speak at a conference:
Imposter syndrome – people are worried about whether their topic is good enough and/or relevant to the audience.
Perfectionism – feel that they may not have the authority to talk so don’t even feel brave enough to initiate a conversation in a smaller forum. For as long as they don’t speak up even at work, then they will never be ready to advance to speak at a meetup or conference.
Anxiety and fear of public speaking – some expressed that they were unsure about how to conquer their fears to ‘go for it’.
Lack of experience – without videos or a history of previous speaking engagements makes it harder to get their initial speaking opportunities.
Lack of awareness – that there’s an open call for speakers for many conferences – ideally they get advance notice and know that they will have plenty of support and opportunity to practice in a safe environment.
Prioritising other activities – not having enough time to hone the craft of public speaking.
Unaware what they need to do to improve their public speaking skills – if they don’t get feedback on why they didn’t get invited or their presentation proposal didn’t get accepted, they end up ruminating on all the possible reasons that could be wrong with them, which doesn’t encourage them to keep finding new opportunities to speak.
Can’t find a mentor – would like to find someone to learn from but don’t know how to get one that’s right for them or willing to invest time in helping them improve their public speaking.
Iva Biva, a service designer who has been designing a solution to get more women involved in sport saw the parallels between women’s participation in sport with participation as speakers at conferences. She said that it’s the anxiety that’s stopping women from participating – the self-doubt and feeling that they are not good enough.
Here are some of the suggestions that the group came up with on how to address the above challenges:
Small support groups – Create a safe and supportive spaces for women to present their ideas in front of a small audience, as well as the opportunity to video and watch themselves
Model examples – Increase opportunities for women to see other women speak.
Co-present – to take the pressure off a novice speaker as they build up their confidence and ability.
More guidance – conference/meetup organisers need to provide more guidance on what they are looking for, how to come up with topics that would be appealing to their audiences and specific feedback to those who missed out on how they can improve and reapply next time.
Mentoring – make it easier for people to find suitable mentors that will help them improve and affirm that they are on the right track to presenting well in front of an audience.
Gain experience outside work through volunteering and pro bono projects.
Opportunities to get practice
The following groups provide lots of speaking opportunities:
Saturday August 24th was our 10th birthday and a big thank you to all the sponsors, speakers volunteers and attendees to made it a lovely day!
It is always a fantastic time when the tribe of people who care about making great products gets together and (if you ask me) Camp is the best day of the year for gaining new knowledge, sharing with others, meeting new people, catching up with friends and ex-colleagues and so much more.
Thanks to some amazing volunteers and attendees, we can share these notes from sessions you may have missed. If we’ve missed yours, add it in the comments. We’ll add more as volunteers send them in.
NPS is global phenomenon which we are told to ignore at our peril – but maybe it’s all pseudoscience!
When the concept of a single survey question to ask and a single number to track to gauge the health of your market offering was introduced to the world 15 years ago, it was to huge acclaim.
Today, it has become the default measure for many organisations, So well-established that so few of us stop to ask why we’re using it.
Daniel will take us back 15 years to the birth of NPS – what was the origin? What was the original intention? Then look at how it’s used now, where it might actually be useful and how it’s misused!
He’ll also talk to how we move forward with actionable measures that will make a difference.
Daniel will cover:
Understanding where NPS makes sense & how we should best employ it
Why NPS is probably not the right tool for product managers
Quantitative and qualitative measures that help us drive product development
Our Speaker: Daniel Kinal has been in product management for over 16 years, chiefly working in IT with a focus on B2B products & services.
He began his career in marketing, communications and consulting but soon learned that the aspect of marketing he loved most was working out what to build, for whom and why.
He gets excited about helping businesses become more effective in decision-making, more efficient in their processes and more engaged with their customers. Daniel is at his happiest when waving his arms about in front of a whiteboard with a bunch of smart people, exploring problems and weighing up solutions.
He is passionate about product management as a discipline and is intrigued by how businesses, large and small, grapple with the innovation, collaboration and the measuring of value.
Grant Hatamosa is the first employee of Zen Ecosystems, a hot upstart in the cleantech/smart grid industry. Grant has worn multiple hats through his journey of becoming Zen Ecosystems Vice President of Product. He was a call centre agent, field technician, manufacturing manager, and operations & support manager on top of his actual role as Product Manager. He currently spends his time on Business Development & Product Management preaching the gospel of energy efficiency to customers in the US and Australia. Prior to his stint at Zen Ecosystems, Grant was a lead software developer for Planet Innovation, a company that was awarded Australia’s Most Innovative Company for a number of years. He also had stints in Singapore and the Philippines for NXP Semiconductors and Lexmark Research and Development respectively.
Shannon Gilleland is a project manager come entrepreneur who earned her stripes not only managing schedules across 12 international teams, for a global games company, but from getting her virtual hands dirty in the e-commerce business setting up and running multiple online businesses. She’s now putting her entrepreneurial, project management and problem solving skills to good use by helping solve one of the worlds plastic pollution problems as well as helping her fellow parents travel easier with a baby.
Carl Rigoni is the founder & CEO of SixSix. With a strong track record in successfully managing portfolios of digital and traditional businesses, generating revenues in excess of $1B, Carl is a leading force in helping our clients achieve their economic goals in the digital landscape. Carl also has extensive experience in building multiple cross functional digital incubation teams to facilitate innovation and Enterprise transformation agendas. Furthermore, he has launched highly successful disruptive products such as an award winning Whereis Mobile Application, Sensis1234, and a national Digital Change of Address Notification service.
Caitlin Blackwell is the acting Head of Product for the candidate experience at SEEK. Caitlin joined us last Thursday to talk about continuous discovery and how SEEK is using this framework.
Caitlin talked to how you can generalise the product manager role into 2 areas – deciding what to build and then building it. Teresa Torres talks to how we have gotten really good at shipping quickly via Agile, Lean Startup and other frameworks. We haven’t had the same emphasis on deciding what to build – ie continuous discovery.
We risk wasted effort when we rush to building and don’t do the work to understand what is needed. We can build an MVP quickly but you might have to wait a while until you have a good enough sample size or feedback to keep moving forward or realise you don’t have the right solution.
Caitlin believes discovery is all about being able to make better decisions through the product process. There’s several reasons we make bad decisions (aka the villains) including lack of clarity on the problem, being overconfident, etc.
A part of Teresa Torres’ framework they use is opportunity maps. This visual mapping lets you clearly state the outcome you want (linked back to your OKRs of course!), show the customer needs and show several solutions that may help you reach the goal.
Speaking to customers is key. Caitlin said their teams (ux & product combined) do 5 customer interviews every fortnight with a standup at end of day to share insights with the rest of the team. It’s important to talk to customers to learn about them, not only test out ideas.
The map helps to visualise the situation though you still have work to do in order to decide which customer opportunity and solution to move forward with. After sizing the opportunity to decide which to explore, you should ideate & validate assumptions through experiments.
Caitlin walked through one example where the OKR was to increase the SAT score of a particular customer segment. She shared some of the tools and ways SEEK walks through continuous discovery. (See the slides at the end this article)
Once you’ve decided which opportunity to go after, it’s time to ideate & validate. There are different tools you can use to experiment and test your ideas (slide 21 has a list).
A few tips:
Spend 5 minutes a day to brainstorm. Frequently spending a short time is less cognitively draining than an hour brainstorm!
Do what you can to learn quickly in order to move forward. Talking with 2 customers is better than no customers. You can still learn something from those 2 (sample size is important but you can learn and be smart about what you’re hearing from small numbers)
Map your assumptions! Decide how you validate/disprove each of them.
During the talk, Caitlin gave us a few examples of how using continuous discovery can help create better products.
First up a product fail. When launching a new product which employers did not have access to, they came up with an ‘access code’ solution process to assist. The team ran an experiment to test the process but didn’t test their assumptions enough before launching – particularly really questioning the desirability and usability of a long process. The sales team’s feedback from employers was it is difficult to change behaviour without showing the value of doing so.
A win… SEEK wanted to introduce the ability to search for jobs by commuting distance. They listed their assumptions, what data they needed to assess risk and how they’d get that quickly. Testing made them realise it’s not just distance in km that’s relevant to job seekers as 10k on a tram vs a highway trip is very different time wise. Experimenting allowed them to dig deeper into understanding the candidate need.
How can you get started with continuous discovery?
Talk to users frequently. Ask them how they use your product.
Decide what metric you want to shift. This could be your OKR.
When ideating, go broad. Go for quantity. You can narrow later.
Do some sort of assumption mapping before you start building. Even if it’s listing out assumptions without a framework.
To Learn More
Caitlin recommends the following:
An introduction to Modern Product Discovery & more resources – Teresa Torres
Along with bringing together international and local speakers for a day of product management goodness, this is the 2nd year they’re welcoming you to pitch for one of their lightning talk spots.
So if you’d like to present to ~500 product professionals, we’re hosting a LTP Pitchfest to give you the chance to do exactly that! If you’re not interested in pitching, please come along and support those who are. RSVP
First, we’ll hear from the folks who did Lightning Talks last year. Daniel Kinal, Shiyu Zhu and Jen Leibhart will talk about their lightning talk experience in planning, practicing and getting up there!
Then, it’s your turn! Those of you interested will get 90 seconds to pitch what you’d like to talk about at LTP. No slides… just you sharing with the crowd & judges. To reiterate… you are NOT doing the lightning talk but just pitching your idea for a LTP talk.
At the end of the evening, 2 people will be selected to present a Lightning Talk at Leading the Product 2019. Selection is based on the judges’ vote (judges to be announced)
Most teams have gotten really good at delivering quickly, and measuring our results. However sometimes we can get a bit addicted to shipping fast rather than right, listen to our assumptions too much, and relying on A/B testing to validate if we’ve delivered value.
Hear about the struggle and joy of a journey of continuous discovery, and some examples of validating ideas before building anything.
Our presenter: Caitlin Blackwell is Acting Head of Product – Candidate Experience at SEEK. She’s previously been in Product Manager roles across many parts of SEEK over the past 7 years, and is currently focused on driving the candidate vision for all of SEEK’s jobseeking products.
Teresa Torres defines Continuous Discovery as weekly touch points with customers, by the team building the product, where they conduct small research activities, in pursuit of a desired product outcome.
That sounds easy but it is a lot of work to adopt if not already a habit. Some of the mindsets needed to do this well are:
A collaborative mindset: Do you have the right people involved in each decision?
A continuous mindset: Are you continuously discovering opportunities and solutions?
An experimental mindset: Are you prepared to be wrong?
Teresa Torres has another great video explaining the value of continuous discovery and where it fits in with the many other methods we may be using already. Join us this month to hear more about what it takes to implement and the benefits to be gained for you and your team. RSVP now
Thanks to our wonderful hosts RMIT Online.
Launching Australia’s first University program in Product Management on the 1st of June to help fulfil the emerging skills gap in product management! It’s a Graduate Certificate – Masters level, 4 subjects, and can be completed in 6-12 months.
Objectives & Key Results. Do they really deliver on the promise? Will they help you reach your goals?
We enlisted 3 product people to talk about their experience of using OKRs to see how they work in real life.
Andrew Knibbe, Head of Product – Direct Hirer at Seek – has over 10 years of product management experience – cutting his product teeth in the early days alongside the ThoughtWorks team at Sensis followed by stints at Carsales and Flippa before moving to SEEK where he has had Head of Product roles across both the Consumer and Business side of the employment marketplace. He remains excited about what OKRs can mean for product teams (and customers!).
Wayne Allan, Technical Product Manager, REA – A muso turned software engineer turned product manager, I love creating things people love! Currently solving problems at realestate.com.au
Brad Dunn, Co-founder and Product Director at OHNO. Before that, he was the executive for Product & Customer Experience at Geo. For 7 years, Brad was the CEO of Nazori, a mobile product development business, where they worked with clients in 12 countries around the world including Samsung, Airbnb and Aesop.
The OKR Process
Andrew let us know that every team at Seek manages their OKRs a little bit differently & they’re currently in their 4th or 5th quarter of doing OKRs.
Andrew described a very team based approach (which is what Wayne also talked to). About 6 weeks before the end of the quarter, the teams receive some context on where the business is going & what they’re seeing in the market. About 2 weeks before the end of the quarter, the team incorporates their own research & knowledge to create draft OKRs for the next quarter. Drafts are reviewed to ensure they are aligned across the portfolio.
Setting OKRs is only part of the process – you need to understand how they went & learn from them. At Seek, there’s check-ins during the quarter (even just emails) and at the end of the quarter, teams present how they went for each OKR, what that means for the roadmap & strategy going forward and what the next set of OKRs are. REA has a mid-quarter update to ensure you’re on the right path or if there’s roadblocks that need to be cleared.
Wayne reminded us that part of the process is needing to educate your team about OKRs. Some people might think they are tied to performance or compensation so you need explain how the OKRs work. As the acceptance of OKRs builds across the business, you need to keep educating different groups.
And Brad noted they do not follow the usual quarterly OKR cycle! They work to a 6 week plan because that’s what works for them.
What works well…
There was clear agreement between our speakers that OKRs can create alignment between teams & stakeholders. They set expectations on what to do, not how to do it. They force prioritisation early on. They help people understand why you did X and not Y. Brad believes they are great for helping people believe in something & getting people to rally behind something.
Wayne believes they help speed up decision making as the product manager doesn’t have to answer everything. People on the team know where they are headed which drives performance within the team.
Based on what our speakers said, it seems they can also help raise issues. Use the OKRs to help show when a deliverable (that’s been delivered) needs some help. If a senior stakeholder says to build X, use the OKRs to manage if that’s the right thing to build.
Brad uses a combination of focusing on outcomes and PIRATE metrics to drive OKR setting.
What’s not working…
Creating your OKRs can be tough. You need to provide enough context for the teams to make good OKRs. Don’t have too many – recognise that even 3 objectives can be too many and 26 KRs is definitely too many. Changing the objectives every quarter can be too much context switching with not enough time to make real progress. They should not be a task list.
Wayne said they realised during planning that they had 3 objectives that were exactly the same thing but had been written in 3 different ways. The team used 3 1-hr sessions to get all their ideas on post-its, all the concrete ideas out and used that to help think at a higher level (& get the entire team onboard).
Make your OKRs part of everyday life can be a struggle. What do you do if half way through the quarter you’ve smashed it? or realised it’s not something you should do.
Measuring your OKRs needs to happen. Wayne advised us NOT to have a set & forget attitude. He suggested setting up your measurement plans in the 1st week. AND not to use surveys to measure everything as there will be survey fatigue from customers & internal folks.
Don’t focus totally on the OKR. Brad finds it fascinating that people really focus on the OKR.. what’s a good one, what’s a bad one. He sets them and then focuses on the outcome.
Brad talked about the concept of ‘mental contrasting’ which consists of 4 items and the first 2 are tied to what an OKR is.
Wish – the inspiring thing you’re going for ie your objective
Outcome – your KR
With mental contrasting, you should take a little time to think about the obstacle. Just thinking about it, helps you act.
FYI, this is also called ‘WOOP‘ (easier to remember than mental contrasting!)
What’s the worse KR you’ve seen? Andrew: “TBC” Brad: putting in an OKR we knew we couldn’t meet – or vanity things.
How long does it take to pull together OKRs? Brad says it’s about 2 days (every 6 weeks). Andrew says it’s much less now that they have done this several times and they don’t change their objectives every time. Wayne has time boxed theirs to 3 hrs.
Wayne & Andrew also talked to the difference between old & new products. New products might need longer to work out the OKRs as opposed to tweaking existing products.
A massive thank you to Andrew, Wayne & Brad, our wonderful speakers for the evening! To our fantastic volunteers for the evening: Gwen, Steve C, Steve B, Rob, Neha, Nigel & Marija. To all attendees!!! And to Medibank for hosting!!!!
This month we will be talking about OKRs – aka Objectives & Key Results!
This is a follow on from our Roadmap discussion in February where some of the frustrations with roadmaps could potentially be addressed by working with OKRs.
OKR’s have been around awhile now, but are somewhat relatively new for product teams here in Oz. We have gathered a few folk who are actively using them, to share the pain and the success of getting started.
Our presenters will be:
Andrew Knibbe, Head of Product – Direct Hirer at Seek – has over 10 years of product management experience – cutting his product teeth in the early days alongside the ThoughtWorks team at Sensis followed by stints at Carsales and Flippa before moving to SEEK where he has had Head of Product roles across both the Consumer and Business side of the employment marketplace. He doesn’t miss the chevrons-on-a-page days of product roadmaps and remains excited about what OKRs can mean for product teams (and customers!).
Wayne Allan, Technical Product Manager, REA – A muso turned software engineer turned product manager, I love creating things people love! Currently solving problems at realestate.com.au
Brad Dunn is the Co-founder and Product Director at OHNO in Melbourne. Before that, he was the executive for Product & Customer Experience at Geo. For 7 years, Brad was the CEO of Nazori, a mobile product development business, where they worked with clients in 12 countries around the world including Samsung, Airbnb and Aesop.
For some pre-reading to get you across the area if you haven’t heard of them or used them yourself then try these resources:
Thanks to our sponsors Medibank for being our hosts this month. RSVP now.
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