Outcome over output
In an increasingly distracting world, the challenge of focusing on the right things has become an almost unattainable goal. We, as companies, teams, and individuals, are navigating a digital realm that has become remarkably adept at capturing our attention. Keeping that attention, however, is becoming ever more difficult.
To keep that focus, or even strengthen it, you should put outcome over output. Are you with us so far? Good. So what does it mean to put outcome over output? And why is it that so many businesses are struggling to adopt this mindset?
Output vs. Outcome
What is output? Output means shipping. It’s about making sure you deliver products to the market. Shipping is essential but it does not equal success. Still, many businesses will celebrate the launch of a feature or product without focusing on how it is received by the end-user.
What is outcome? Simply put, outcome is output plus user value. An outcome mindset dictates how you perceive success. Shipping a feature or product is not the be-all and end-all, but rather another chain in the product delivery cycle, which consists of ideation, conceptualization, building, shipping, and ultimately: succeeding.
Most companies have product roadmaps plotted out at least six months ahead—often even a year or more. It’s no secret that they are not always followed. On the contrary: after just the first few weeks, these roadmaps are at risk of being horribly outdated.
So why do we go ahead and make these long-term plans in the first place? It’s in our nature as humans to want to feel in control. Yet, paradoxically:
letting go of full control is key in building successful products.
The reality is that you don’t know in advance which projects or features will succeed: the average failure rate is anywhere between 50 and 80%. This is what Marty Cagan, one of the most important thought-leaders in the digital products sphere, calls the inconvenient truth of product management.
In fact, some of what you build will add negative value for users, by distracting them or bloating an otherwise focused product experience.
There is an inescapable effect of uncertainty in product development. Embracing it is crucial. While building software, it’s important to understand the need to continuously focus on outcomes in a never-ending optimization cycle of product-market fit.
The product discovery process is key to this optimization cycle. A mature discovery process at the very least uses A/B testing for quantitative feedback, and user testing for qualitative feedback. Other techniques include smoke tests, surveys, and alpha/beta programs, to name a few. Use data to quickly learn what works.
Planning for outcomes
When you plan for new features, you want to connect sets of steps to clear outcomes. You don’t know which features will be successful and which will fail, so think of your plan as a set of experiments.
One popular framework for setting goals is OKR. Objectives and Key Results guarantee that you remain focused on specific goals and attach measurable targets to them (i.e. key results as outcomes).
For example, you can set the objective of crafting the optimal onboarding experience in your app, with the overall signup conversion as one key result. Then, it is up to the product teams to discover the best way to reach that objective using measurable experiments.
‘To experiment’ doesn’t always mean ‘to build’. In fact, it’s crucial to refute an idea as quickly as you can and make sure you stop exploring something that will not provide value for users.
On failing well
At X, Google’s Moonshot Factory (which is where a lot of incredibly smart people try to develop solutions for some of the world’s most challenging problems), they appreciate these types of experiments so much that they give bonuses to teams that fail well. By calling it quits on a project that was bound to fail, the team saves the company a lot of money. It frees up time and paves the road for building the right thing instead.
Peter Drucker, one of the pioneers of good management techniques, said that
there is nothing as useless as building something efficiently that should not have been built at all.
OKRs are typically mapped out every quarter. One way to plan for outcomes is to have a quarterly roadmap listing your objectives and linking the necessary steps to reach those objectives to your goals and key results (see figure below).
Don’t be fooled by its quarterly recurrence: this approach results in an organic roadmap that changes over time as you learn what does and doesn’t work. This saves you from the pitfall of—often unattainable—fixed deadlines, help you respond more quickly to swift market changes, and push you to focus on outcomes rather than output.
A process-driven approach
The key to having good ideas (and features) is to have many, then throw away the ones that don’t work.
But while it’s good to have many ideas and see your roadmap as an organic document for experimentation, you still have to pick one or more to start and see if they provide the right outcomes. So how do you go about this challenge of prioritization?
Some software companies, like Snapchat, pride themselves on building new product features based on intuition. Evan Spiegel and his product teams have gotten very far with this approach, pioneering completely new digital content formats such as stories, later adopted by Instagram and Facebook. These have obviously created tremendous user value.
You can use several models for a more process-driven approach to prioritize user value. (R)ICE (reach, impact, confidence, effort), and Kano are two well-known examples. They are especially useful in larger companies where you often see multiple clashing priorities coming from different stakeholders. These models should provide a more transparent view of what comes next, and why. It’s a good idea to continuously communicate why you believe the thing you are building next will create the most user value.
Planning for outcomes can be done by using a continuously evolving roadmap of goals, key results, and steps. Validating ideas in user tests, feedback sessions, surveys, and A/B tests are examples of steps to help you gain confidence in what works for your users. As these experiments progress, you become more confident about what ideas to keep, and you can move your product and ultimately your entire organization towards success.