In product management, it is important to focus on outcomes rather than outputs. This means that rather than focusing on the features or deliverables that a product team (including the engineering team) is producing, the focus should be on the impact that those features or deliverables are having on the end users and/or the business.
For example, a product team may be working on a new feature that allows users to customize their profiles. While the output of this work may be a new feature that allows for profile customization, the outcome may be increased user engagement or retention. By focusing on the outcome, the product team can prioritize work that will have the most significant impact on the business and its users.
It is also important to note that outcomes can be both short-term and long-term. For example, a short-term outcome may be an increase in user satisfaction, while a long-term outcome may be increased revenue. By considering both short-term and long-term outcomes, product teams can ensure that their work is aligned with the overall goals of the business.
Five steps to defining the right outcome metrics
Here are my five steps to defining the right outcome metrics:
1. Identify the key goals and objectives. It is important to identify the key goals and objectives of the product (or a project). This will help to guide the selection of metrics that will be most relevant and meaningful for measuring the success of the product or project.
2. Focus on outcomes. As mentioned earlier, it is important to focus on outcomes rather than outputs. This means that the metrics should be tied to the impact that the product or project is having on the business and its users.
3. Make sure the metrics are actionable. The metrics should be measurable and should provide actionable insights. For example, if the metric is related to user engagement, it should be possible to take specific actions based on the data collected, such as improving the user experience or introducing new features.
4. Show ratios over time. Avoid looking at absolutes and instead, compare ratios and/or rates. There is a big difference in the amount of information conveyed when looking at “50,000 sign-ups this week” versus “+50% in sign-ups WoW.”
5. Assign ownership. Metrics should have a single owner (usually a PM) who is empowered to drive results. This helps ensure accountability and prevents teams from duplicating efforts. However, the whole team should buy into the outcome that they are driving towards.
Overall, prioritizing outcomes over outputs is an important practice in product management because it helps to ensure that the work being done is having a meaningful impact on the business and its users.
It is also important to regularly review and adjust the metrics to ensure that they are still relevant and meaningful. This can help to ensure that the product or project is on track and aligned with the overall goals and objectives of the business.
Originally published on LinkedIn, Jan 4, 2023.