M.R. asks Pete Sinclair, CEO of Obo, 3 questions

M.R Rangaswami, co-founder of Sand Hill Group, sat with Obo CEO and founder, Pete Sinclair, to discuss the problems that Obo is trying to solve, whether or not NPS should be used to measure product success, and ways to improve alignment between executives and product teams. 

This article was originally published on sandhill.com

M.R. Rangaswami: Why was Obo created and what problem is the company trying to solve?

Pete Sinclair: Obo was created to address the enormous problem of product failure. Harvard Business School professor, Clayton Christensen, notes that each year 30,000 consumer products are launched—and 95 percent of them fail. Many others have done studies on product failure, and the average failure rate is over 70 percent across the board. Both new and existing products can fail for many reasons, not the least of which is misalignment between what the engineering team is building, what the C-suite envisions and what the customer and market actually need.

We saw, from our own experiences as former executives, product managers, and product developers, the way products “escaped” out into the market with insufficient validation; we’ve witnessed it firsthand and saw new products and new releases of existing products that missed the mark. We did research with more than 2,000 companies and saw a clear need in the market for a system that brings stronger validation and analytic capabilities to the product decision-making process. There are software tools on the market today that help you build the wrong product faster when what you really need are applications that help you make better decisions about what you should build—before you build it.

Our research identified a gap between the company strategy (that says “head east”) and development planning (that needs step-by-step “turn right on 1st St., then left at the next light”). We call it the muddy middle, where product leaders synthesize desired business outcomes, market needs, and customer needs into strategic product plans. And then they have to work with delivery and engineering to break it all down into sprint-sized, prioritized pieces to feed their agile teams. Obo fills that gap.

Obo addresses a top challenge facing businesses today, namely the need to build better products without investing countless hours into analyzing the risks and rewards of each move (or, worse, not analyzing these things due to lack of time, resources, or organizational will). The Obo SaaS platform was designed to empower technology product organizations to make better decisions and consistently put their best product forward by aligning the product process with core business objectives and using concrete data from internal and external stakeholders, customers, and the market to inform the product decision-making process at every step. Instead of building elaborate roadmaps in silos for what may or may not be the right features, teams across an enterprise—from the C-suite to product managers to engineers to customer success teams—use Obo to collaborate on product plans. By adding a layer of software automation to this process, we provide value and mitigate natural human biases by supporting decisions with easy-to-understand data. People can see the impact of tradeoffs and make better decisions. 

M.R.: Do you think the net promoter score (NPS) is an accurate way to measure and validate the success of a product?

Pete: NPS asks the wrong question. It’s similar to “likes in social media. It might feel good to have a positive NPS, but it doesn’t tell you why customers like something or what will make them buy more. NPS might be a good starting point for companies that want to understand and single out specific functionality users like or don’t like about a product, but it doesn’t offer enough insight to guide the most important decisions a business can make. The more complex the product functionality, the less NPS works as a representative success score. You need to dig deeper and take a step back to assess what truly works and what doesn’t when evaluating a product. 

The product process is not a one-way path and we waste enormous effort when we address product problems and complaints individually, especially given people’s natural bias to respond at the extremes. Product teams need to focus more on implementing more of what customers are proven to love, and should take a more holistic approach to getting feedback to understand what’s important to both customers and the market as a whole. This will result in more overall traction and product success when products are out in the market. 

M.R.: A challenge many executives and product managers face is prioritization. What do you feel is the underlying cause of misalignment between executives and product managers, and how can it be improved?

Pete: Product managers often struggle to prioritize what goes into product plans. In business environments facing rapid change (which is every company today), it’s challenging to collaborate and communicate to make decisions that support strategy. Our recent State of the Product Journey Report found that more than one quarter (28 percent) of about 600 respondents across job functions believe that competing priorities are the number one challenge faced when building a better product plan, while 21 percent of all respondents said that the top barrier is a shift (or shifts) in strategy and priorities. 

 Product managers need to implement systems that help them focus on what matters most to their market, customers, and internal and external stakeholders so they can deliver more successful products. Validating product decisions with verifiable and explainable data allows product teams to clearly articulate the “why” behind product decisions, and allows data-driven prioritization to get a front seat. 

For example, C3, a leading AI-based enterprise software provider, is using Obo to improve feature prioritization and product planning. So far, they’ve used Obo to evaluate and prioritize features for a new financial services product they are developing. They plan to use Obo to run feature preference surveys with both internal stakeholders and experts as well as with potential customers. This helps C3 assess the expected demand for and benefits of potential features before investing development resources.

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