Category: Product Management

Author: Tony Fadell

My Rating: 5/5

Summary: A fantastic book about how to build extraordinary products – told by one of the leaders who brought the iPod, iPhone and Nest products to market.

My Takeaways

Start with a problem. Take Uber. The founders started with a customer problem—a problem they experienced in their daily lives—then applied technology.

As a manager, you should be focused on making sure the team is producing the best possible product.

It’s important to remember that even if you have to criticize someone’s work or their behavior, you’re not doing it to hurt them. You’re there to help. Every word should come from a place of caring. So tell them what’s holding them back. Then make a plan to work on it together.

If you’re a good manager and build a good team, that team will blast off. So lean into it. Cheer them on when they get promoted. Glow with pride when they kick ass at a board meeting or present their work to the entire company. That’s how you become a good manager. That’s how you start to love the job.

But data can’t solve an opinion-based problem. So no matter how much data you get, it will always be inconclusive. This leads to analysis paralysis—death by overthinking.

If you don’t have enough data to make a decision, you’ll need insights to inform your opinion. Insights can be key learnings about your customers or your market or your product space—something substantial that gives you an intuitive feeling for what you should do.

People just can’t articulate what they want clearly enough to definitely point in one direction or another, especially if they’re considering something completely new that they’ve never used before. Customers will always be more comfortable with what exists already, even if it’s terrible.

A/B and user testing is not product design. It’s a tool. A test. At best, a diagnosis. It can tell you something’s not working, but it won’t tell you how to fix it. Or it can show you an option that solves one hyperlocal issue but breaks something else downstream.

You need a hypothesis, and that hypothesis should be part of a bigger product vision. So you can A/B test where the “Buy” button should go on a Web page, whether it should be blue or orange, but you shouldn’t be testing whether or not a customer should buy online.

If you’re testing the core of your product, if the basic functionality can flex and change depending on the whims of an A/B test, then there is no core. There’s a hole where your product vision should be and you’re just shoveling data into the void.

Storytelling is how you get people to take a leap of faith to do something new. It’s what all our big choices ultimately come down to—believing a story we tell ourselves or that someone else tells us. Creating a believable narrative that everyone can latch on to is critical to moving forward and making hard choices. It’s all that marketing comes down to. It’s the heart of sales.

Helping people see things from the customer’s perspective is a critical tool, but it’s just part of what you need to do. Your job in this moment is to craft a narrative that convinces leadership that your gut is trustworthy, that you’ve found all the data that could be gleaned, that you have a track record of good decisions, that you grasp the decision makers’ fears and are mitigating those risks, that you truly understand your customers and their needs and—most importantly—that what you’re proposing will have a positive impact on the business.

So you can’t wait for perfect data. It doesn’t exist. You just have to take that first step into the unknown. Combine everything you’ve learned and take your best guess at what’s going to happen next.

it’s data and intuition.”

But pushing for greatness doesn’t make you an asshole. Not tolerating mediocrity doesn’t make you an asshole. Challenging assumptions doesn’t make you an asshole. Before dismissing someone as “just an asshole,” you need to understand their motivations.

You should talk to people and make connections because you’re naturally curious.

don’t just make a prototype of your product and think you’re done. Prototype as much of the full customer experience as possible. Make the intangible tangible so you can’t overlook the less showy but incredibly important parts of the journey. You should be able to map out and visualize exactly how a customer discovers, considers, installs, uses, fixes, and even returns your product. It all matters.

The only time hardware is worth the headache of manufacturing and packaging and shipping is if it’s critically necessary and transformative. If hardware doesn’t absolutely need to exist to enable the overall experience, then it should not exist.

“Don’t tell me what’s so special about this object. Tell me what’s different about the customer journey.” Your product isn’t only your product. It’s the whole user experience—a chain that begins when someone learns about your brand for the first time and ends when your product disappears from their life, returned or thrown away, sold to a friend or deleted in a burst of electrons.

Makers often focus on the shiny object—the product they’re building—and forget about the rest of the journey until they’re almost ready to deliver it to the customer. But customers see it all, experience it all. They’re the ones taking the journey, step-by-step. And they can easily stumble and fall when a step is missing or misaligned.

In each of these moments, the customer asks “why?” Why should I care? Why should I buy it? Why should I use it? Why should I stick with it? Why should I buy the next version? Your product, marketing, and support have to grease the skids—continually communicate and connect with customers, give them the answers they need, so they feel like they’re on a smooth ride, a single continuous, inevitable journey.

don’t wait until your product is done to get started—map out the whole journey as you map out what your product will do.

Start from that very first moment of the customer journey. You should be prototyping your marketing long before you have anything to market. At Nest, that meant focusing on the box. The packaging led everything. The product name, the tagline, the top features, their priority order, the main value props—they were literally printed on a cardboard box that we constantly held, looked at, tweaked, revised.

Instead we included four heads—more than anyone needed to install the thermostat—so that people could use it for practically anything. So that Nest stayed in their brains as long as the screwdriver stayed in their drawer.

Our product was good, but ultimately it was the whole journey that defined our brand. That’s what made Nest special. It’s what makes Apple special. It’s what allows businesses to reach beyond their product and create a connection—not with users and consumers, but with human beings. It’s how you create something that people will love.

Every product should have a story, a narrative that explains why it needs to exist and how it will solve your customer’s problems. A good product story has three elements: »  It appeals to people’s rational and emotional sides. »  It takes complicated concepts and makes them simple. » It reminds people of the problem that’s being solved—it focuses on the “why.”

He used a technique I later came to call the virus of doubt. It’s a way to get into people’s heads, remind them about a daily frustration, get them annoyed about it all over again. If you can infect them with the virus of doubt—“Maybe my experience isn’t as good as I thought, maybe it could be better”—then you prime them for your solution. You get them angry about how it works now so they can get excited about a new way of doing things.

Your product’s story is its design, its features, images and videos, quotes from customers, tips from reviewers, conversations with support agents. It’s the sum of what people see and feel about this thing that you’ve created.

And it all starts with “why.” Why does this thing need to exist? Why does it matter? Why will people need it? Why will they love it?

You have to appeal to their emotions—connect with something they care about. Their worries, their fears. Or show them a compelling vision of the future: give a human example. Walk through how a real person will experience this product—their day, their family, their work, the change they’ll experience. Just don’t lean so far into the emotional connection that what you’re arguing for feels novel, but not necessary.

Another thing I learned from Steve Jobs. He’d always say that analogies give customers superpowers. A great analogy allows a customer to instantly grasp a difficult feature and then describe that feature to others. That’s why “1,000 songs in your pocket” was so powerful. Everyone had CDs and tapes in bulky players that only let you listen to 10–15 songs, one album at a time. So “1,000 songs in your pocket” was an incredible contrast—it let people visualize this intangible thing—all the music they loved all together in one place, easy to find, easy to hold—and gave them a way to tell their friends and family why this new iPod thing was so cool.

You should always be striving to tell a story so good that it stops being yours—so your customer learns it, loves it, internalizes it, owns it. And tells it to everyone they know.

You can continue evolving that product for a while, but always seek out new ways to disrupt yourself. You can’t only start thinking about it when the competition threatens to catch up or your business begins to stagnate.

When you’re evolving you need to understand the quintessential things that define your product. What’s key to your feature set and your branding? What have you trained the customer to look for? With the iPod it was the click wheel. With the Nest Learning Thermostat it was the round, clean screen with a big temperature in the middle.

To maintain the core of your product there are usually one or two things that have to stay still while everything else spins and changes around them. And that’s a useful constraint. You need some constraints to force you to dig deep and get creative, to push envelopes you hadn’t thought to open before.

So we learned to underpromise and overdeliver. We’d be conservative about key features like battery life—all through development we’d make sure we’d reached a number that Steve was satisfied with.

You cannot be afraid to disrupt the thing that made you successful in the first place. Even if it made you hugely successful. Look at Kodak. Look at Nokia.

Once every carmaker has an electric vehicle, then the customer will focus on all these other aspects that Tesla has already disrupted and brought to market. Competition is a given, both direct and indirect. Someone is always watching, trying to exploit any crack in a more successful competitor.

You should also keep in mind that you’re not just making V1 or V2 of your product—you’re building out the first or second version of your team and processes.

Here’s the trick: write a press release. But don’t write it when you’re done. Write it when you start. I began doing this at Apple and eventually realized other leaders had figured it out, too (looking at you, Bezos). It’s an incredibly useful tool to narrow down what really matters.

When you write a press release you say, “Here. This. This is what’s newsworthy. This is what really matters.”

The way you keep everyone moving is by creating strong internal deadlines—heartbeats that your team sets their calendar to:

But we would have never reached that third design if we hadn’t given ourselves hard deadlines with the first two—if we hadn’t cut ourselves off after a few months, reset, and moved on. We forced as many constraints on ourselves as possible: not too much time, not too much money, and not too many people on the team. That last point is important.

So keep your project small as long as you can. And don’t allocate too much money at the start. People do stupid things when they have a giant budget—they overdesign, they overthink. That inevitably leads to longer runways, longer schedules, and slower heartbeats. Much, much slower.

So have at least one really big launch and another one to three smaller launches every year.

Your team will have to figure out how to find product/market fit for V1, then get the product fixed up and properly marketed to a wider audience with V2, and only then can you focus on optimizing the business so it can be sustainable and profitable with V3.

Both the unexpected issues that inevitably crop up after you launch and the stuff you cut corners on the first time. V2 usually comes swiftly after V1 because you’ve learned so much so fast and you’re dying to get it all into the next generation.

They created a V1 product, scaled it for V2, then optimized the business in V3. The Nest Learning Thermostat followed the same pattern.

You make the product. You fix the product. You build the business.

There are three elements to every great idea:

1. It solves for “why.” Long before you figure out what a product will do, you need to understand why people will want it. The “why” drives the “what.”

2. It solves a problem that a lot of people have in their daily lives.

3. It follows you around. Even after you research and learn about it and try it out and realize how hard it’ll be to get it right, you can’t stop thinking about it.

That’s why we didn’t just present our vision when we pitched investors. We presented the why—told our story—and then we presented the risks. Too many startups don’t know what they’re getting into or, worse, try to cover up the risks of failure.

Sharing the load is one thing; unloading it altogether is another. If you’re going to lead a team, you need to be ready to lead.

In those very, very early days you want people who are there for the mission above all. You’re looking for passion, enthusiasm, and mindset. And you’re looking for seed crystals. Seed crystals are people who are so good and so well loved that they can almost single-handedly build large parts of your org.

Typically a VC needs between 18 and 22 percent to make their model work—step carefully if they begin asking for more. And don’t assume they’re the only game in town—if your gut is telling you to keep looking, then keep looking.

You need some way to rise to the top and get their attention. The best way to do that is with a compelling story. And knowing your audience. Even in Silicon Valley, most VCs won’t be technical. So don’t focus on the technology, focus on the “why.”

It’s like playing chess. You always have to think two moves—and two investment rounds—ahead.

Steve Jobs was clear about the lesson he’d learned and made sure we all learned it, too: any company that tries to do both B2B and B2C will fail.

That’s the other rule: if you cater to both, your marketing still has to be B2C.

You can only have one customer. Choose wisely.

The act of using a pen, then retyping and editing later, forced me to process information differently.

Everyone needs to find their own system. But you do need to prioritize your tasks, manage and organize your thoughts, and create a predictable schedule for your team to access those thoughts. And then you need to take a break.

As a leader, you’ll have to get into the weeds. Don’t be worried about micromanagement—as the crisis unfolds your job is to tell people what to do and how to do it. However, very quickly after everyone has calmed down and gotten to work, let them do their jobs without you breathing down their necks.

If something is your fault, tell them what you did. Tell them what you’ve learned from it. And tell them how you’ll prevent it from ever happening again. No evading, blaming, or making excuses. Just accept responsibility and be a grown-up.

The best teams are multigenerational—Nest employed twenty-year-olds and seventy-year-olds. Experienced people have a wealth of wisdom that they can pass on to the next generation and young people can push back against long-held assumptions. They can often see the opportunity that lies in accomplishing difficult things, while experienced people see only the difficulty.

Different people think differently and every new perspective, background, and experience you bring into the business improves the business.

The key is to get the candidate talking to the right people.

Crown 1 was the hiring manager. They got the role approved and found the candidates. Crowns 2 and 3 were managers of the candidate’s internal customers. They picked one or two people from their team to interview the candidate. Feedback was collected, shared, and discussed, then the Three Crowns met to decide who to hire.

Another good interview technique is to simulate work—instead of asking them how they work, just work with them. Pick a problem and try to solve it together. Choose a subject that both of you are familiar with but neither is an expert in—if you pick a problem in their domain they’ll always sound smart; pick a problem in yours and you’ll always know better.

You’re not just interviewing to see if a person can do the job required of them today. You’re trying to understand if they have the innate tools to think through the problems and jobs you don’t see coming yet—the jobs they can grow into tomorrow.

the only way to do that was to integrate new people into the culture at a reasonable pace, so they could learn by doing, by watching, by working with the team and absorbing the culture organically.

Don’t worry about getting too in the weeds or not giving them enough freedom. Not at first. A brand-new person needs all the help they can get to become really well integrated. Explain how you do things in detail so they don’t make mistakes and alienate the rest of the team right off the bat. Talk to them about what’s working and what isn’t, what you would do in their position, what’s encouraged and what’s verboten, who to ask for help and who to treat with kid gloves.

Just as people make a commitment to your company when they join it, you make a commitment to them. If you’re leading a company or a large org, it is your responsibility to help people identify their challenge areas and give them space and coaching to get better or help them to find a spot at the company where they can be successful.

What you’re building never matters as much as who you’re building it with.

You have to start forming a strategy for how you’ll grow past a breakpoint long before you reach it—at a minimum two to three months before the break and then months of follow-up after.

So focus people’s attention on the opportunity: help them get curious about what their job could become, instead of being fearful of what they might lose.

So to preserve what you love, have your team write down the things they value most and build a plan to continue them. And remember it’s not necessarily the obvious stuff that binds people to your company—it can be small things, silly things. At Nest a few members of the team started doing barbecues in the parking lot when we were really small.

Businesses that try to ignore breakpoints either don’t survive or get stuck at their current size and stagnate.

At its core, designing simply means thinking through a problem and finding an elegant solution.

Deploy design thinking: This is a well-known strategy originated by IDEO’s David Kelley that encourages you to identify your customer and their pain points, deeply understand the problem you’re trying to solve, and systematically uncover ways to solve it.

Avoid habituation: Everyone gets used to things. Life is full of tiny and enormous inconveniences that you no longer notice because your brain has simply accepted them as unchangeable reality and filtered them out.

Literally the only way to make a really good product is to dig in, analyze your customer’s needs, and explore all the possible options (including the unexpected ones:

But you shouldn’t outsource a problem before you try to solve it yourself, especially if solving that problem is core to the future of your business. If it’s a critical function, your team needs to build the muscle to understand the process and do it themselves.

Ask why at every step—why is it like this now? How can it be better? Think like a user who has never tried this product before; dig into their mindset, their pain and challenges, their hopes and desires. Break it down into steps and set all the constraints up front.

Understand and tell the story of the product.

Create prototypes all along the way.

Marketing cannot just be figured out at the very end.

Use marketing to prototype your product narrative. The

The product is the brand.

The entire experience has to be designed together, with different touchpoints explaining different parts of your messaging to create a consistent, cohesive experience.

The best marketing is just telling the truth. The ultimate job of marketing is to find the very best way to tell the true story of your product.

And you tell a story: you connect with people’s emotions so they’re drawn to your narrative, but you also appeal to their rational side so they can convince themselves it’s the smart move to buy what you’re selling. You balance what they want to hear with what they need to know.

First you break down the pain points that your customer is feeling or has habituated away. Each pain is a “why”—it gives your product a reason to exist. The painkiller is the “how”—these are the features that will solve the customer’s problem. The “I want it” column explains the emotions that your customers are feeling. The “I need it” column covers the rational reasons to buy this product. The whole product narrative should be in there—every pain, every painkiller, every rational and emotional impulse, every insight about your customer.

For every version of the Nest story, we wrote down the most common objections and how we’d overcome them—what stats to use, what pages of the website to send people to, what partnerships to mention or testimonials to point to. We figured out which story we could put on a billboard all the way down to the story we’d tell a longtime customer.

Everything is connected to everything, so everything must be understood together.

The spec shows the features, the details of how a product will work, but the messaging predicts people’s concerns and finds ways to mitigate them. It answers the question, “Why will customers care?” And that question has to be answered long before anyone gets to work.

The best salespeople are the ones who maintain relationships even if it means not making money that day.

But if sales is off to the side, doing their own thing, barely part of the company but steadily meeting their monthly goals, that can breed an insulated, transactional culture. And the way customers are treated in that kind of culture can be brutal—even in places where you’d assume customers must be treated well in order for salespeople to make any money.

Once commissions are vested on a schedule that prioritizes customer relationships, a lot of the ugliness that usually defines sales cultures disappears. Salespeople do a better job qualifying customers, the hypercompetition eases up, the backslapping fades, the teams align their expectations and their goals.

Hire a lawyer who doesn’t just think like a lawyer.

You don’t have to be an expert in everything. You just have to care about it.

They hold people (and themselves) accountable and drive for results.

They can keep an eye on the long-term vision while still being eyeball-deep in details.

In this job, respect is always more important than being liked.

And as always when you’re presenting numbers, it becomes much more important to craft a narrative. You have to tell a story.

Just as dessert shouldn’t come before dinner, perks shouldn’t come before the mission you’re there to achieve. The mission should fill and fuel your company. The perks should be a sprinkle of sugar on top.

In the end, there are two things that matter: products and people. What you build and who you build it with.

See the invisible problems not just the obvious problems. For example, Steve Jobs wanted the iPod batteries fully charged for the customer when unboxing so they customer can use it instantly.

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