A product manager’s role can essentially be summarised as following:
Managing a product is not an elementary task though. It spans over numerous sub-processes, challenges, and dynamic forces, that involve thorough customer research, iterative product development, implementing a scalable architecture, in a constantly changing market with shifting customer expectations, varied stakeholder opinions and interests all within a significant time horizon.
Altogether these factors have tremendous potential to divert the product from its strategic long term goals or make it fairly difficult to stay on the right path.
In this context, KPIs or success metrics are handy tools for product teams. They act as a guiding light to help them stay on the right track in regards to their vision and strategy.
As a rule of thumb, there are two considerations for identifying KPIs:
This fundamentally means measuring KPIs at all levels and in all areas.
As much as your product strategy directs the KPIs of your product, releases, and richness of features, your product will also be impacted by sprint goals, epic success metrics, and stories feedback. A constructive measurement framework is fundamental to provide direction at all levels.
Strong customer feedback on the release of an epic may result in significant changes in your roadmap features which in turn might require tweaks in future releases and the overall strategy. Simultaneously, your strategy directs which features go on your roadmap and the richness of features on your roadmap guide your backlog items. Hence, why it is crucial to measure KPIs at all levels from strategy to epics
Measuring every aspect of your product development process is essential. Measurement insufficiency in any area has a cascading impact on the success of the product.
For example, your previous release might have increased the number of active users of your product and supported your revenue targets. But limitations on a healthy release pipeline, an ineffective regression suite, a lack of management sponsorship or weak team motivation will make it impossible to keep the momentum.
A measurement framework can be costly. The more complex it is, the more time and energy your team will spend discussing and making decisions on it. Hence why it is absolutely mandatory to keep it lean, specific and avoiding vanity metrics.
I was once working on a retail product for a company that was originally selling its goods on major e-commerce platforms (e.g. Amazon), which meant that a substantial fee was paid to such platforms on every item sold. Although it was enticing to measure customer acquisition on the new retail product we were building, this KPI alone wasn’t a credible measure of how we were performing according to our strategy. Instead, measuring the conversion of customers from other e-commerce platforms to the new retail product was of higher value. It accurately translated the reduction in fees paid to other e-commerce platforms and reduced the customer acquisition costs burden.
In addition to the key considerations, some additional guidelines that are helpful for choosing and maintaining the right success metrics:
The benefits of a measurement mindset are manifold. They not only guide you through the product path but also help you constantly adapt the path as conditions change so that you are always heading north.
At Fabric we believe that using data, information and empirical evidence is essential to drive our decisions and approach. KPIs and a robust measurement framework that are unique to its product’s needs are part of our core product management and development practices.
We'd love to discuss your measurement strategy, fill out this form and we will be in touch.