The Product Manager’s Guide

to Strategic Planning

Table of Contents

1. Why You Need to Start with Top-Down Strategic Planning

2. Developing the Product Strategy

3. Defining Your Product Goals

4. Roadmap Planning in an Agile World

5. Typical Roadmap Process Challenges

6. Using Metrics to Support Your Strategy

Strategic Roadmap Planning Guide 2

Introduction

The most important part of the roadmapping process happens before

you begin building your roadmap. Setting the vision and strategic goals
for your product—and, more importantly, getting alignment on these with
your stakeholders—is the first step to creating a successful roadmap.

In this guide, we’ll walk you through the process of developing your
product strategy, defining your product goals, and choosing the right
metrics for your product. We also explain how long-term strategic
planning fits into your agile development process, and why your backlog
will never be a substitute for your product roadmap.

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1
Why You Need to
Start With Top-Down
Strategic Planning
1
Why Top-Down Strategic
roduct Vision
Planning Matters P
roduct Goals
At ProductPlan, we’ve had the opportunity to talk with
hundreds of product managers, and through these
P
conversations we’ve learned that executives prefer top-
duct Roadm
down strategic planning and communication. Executives ro a

p
want to have productive discussions about future initiatives
that tie directly to the product vision and goals. A top-down
discussion and planning process has a greater chance of Release Plan
producing a product roadmap that moves the needle for
& Backlog
the company.

By sharing a high-level product vision, product managers

can get the executive team, marketing, support, engineering,
and the rest of the organization on board with the strategy.

Product managers have told us their executive team simply Start by defining your high-level product vision, then use
doesn’t care much about the details—what they really it to derive actionable, measurable product goals. Your
care about is whether the proposed roadmap fits with the vision and goals should inform your product roadmap,
strategic direction of the company and when its initiatives which in turn sits a level above your more granular release
plan and backlog.
will be delivered to support the strategy. Successful product
managers tap into this by keeping the roadmapping process
high-level and collaborative. From there, they can derive the
detailed release plan and backlog.

Strategic Roadmap Planning Guide 5

 “
Clearly explain why your product
exists and your approach to running it.
This could be a mission statement, tenets,
or principles. The important thing is that
you believe in them, and by pinning them
at the top of every roadmap it will be clear
if what follows in the roadmap doesn’t
match your principles.
“
Ian McAllister, Director, Alexa International

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2
Developing the
Product Strategy
2
Developing the Product
Strategy
When developing a strategy, it’s important to identify and This Strategy-first Approach has Several Benefits:
articulate your product’s vision and principles—the “why.”
• It makes it easier to articulate the product vision to any
Before you begin planning your roadmap, spend some constituency across your company, and ensure your
time determining the product’s mission, and then distill it stakeholders are on the same page for the detailed
into a simple statement your stakeholders can understand. conversations that follow.
Documenting this forces you to nail down many of the key
items that will inform your roadmap. • It makes it easier for you to clearly see your product’s
vision, and allows you to identify priorities as well as those
Your executives need to know (and agree with) your plans for items that should be set aside because they don’t serve
your product’s development—because they will ultimately the product vision.
need to sign off on those plans. Your development teams
need to know what you have planned for your product, and
why, because they will be responsible for building it. Your
sales, service, and marketing teams will need to know the
what and why as well—so they can articulate your strategy to
the market.

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 Examples of Product Visions From Leading Companies

“
Google’s Vision:

To organize the world’s information and make it universally

accessible and useful.

Ikea’s Vision:

At IKEA our vision is to create a better everyday life for the many
people. Our business idea supports this vision by offering a wide range of well-
designed, functional home furnishing products at prices so low
that as many people as possible will be able to afford them.

Amazon’s Vision:

Our vision is to be Earth’s most customer centric company;

to build a place where people can come to find and discover anything
they might want to buy online.
“
Strategic Roadmap Planning Guide 9
3
Defining Your
Product Goals

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3
Defining Your Product
Goals
From the product vision, you can derive product goals that
will in turn influence the initiatives that are on your roadmap. Example product goals:
Coming up with product goals is the step that helps you
translate your product strategy into an executable plan. • Competitive differentiation
• Customer delight
Every organization’s product goals will be different. You
can develop product-specific, company-oriented, or more • Technical improvements
generic goals. • Improve customer satisfaction
Goals may be general, but they can usually be measured • Increase lifetime value
and tied back to Key Performance Indicators (KPIs). It’s • Upsell new services
these types of actionable, measurable goals that will
resonate with your stakeholders. Goals are often
• Reduce churn
longer-term initiatives—for example, they might change • Expand geographically
annually rather than monthly.
• Improve mobile adoption
• Increase monthly active users
• Grow existing accounts
• Improve NPS

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4
Roadmap Planning
in an Agile World
4
Roadmap Planning in
an Agile World
At first blush, the terms agile and product roadmap seem like But the backlog in itself is not the roadmap—a product
a contradiction, but they’re not. roadmap defines a strategic view of where the product is
headed over the mid to long term. The roadmap is tied to the
In most agile product development organizations, the backlog organization’s vision and strategic goals, often for the next
defines the product features for the near term. From the 12 or more months. In an agile organization, the roadmap
backlog, the development team is (hopefully) aware of what’s provides guidance rather than a strict project plan.
coming next, at least for the next few sprints or iterations.

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The Backlog Is Not a Roadmap
The roadmap needs to communicate the big picture to the Because the roadmap will inevitably change, it’s important
organization—the initiatives that move the needle, expand to set expectations with your stakeholders that the roadmap
markets, address competition, and create customer value. is not a promise. Many of our customers keep the roadmap
That big-picture thinking cannot be distilled in the backlog. dates at a monthly or quarterly level, or leave dates off
It’s challenging to communicate strategy in a list that’s 200 altogether to avoid setting the impression that features will
items long, especially to executives and other stakeholders be delivered by a specific date.
who might not think in terms of iterations or sprints.
Product managers need to regularly communicate where the
Even agile organizations need this strategic view. At product is heading so that everyone is on the same page,
ProductPlan, we’ve discovered our customers are sharing especially stakeholders who make final decisions, control the
product roadmaps with the engineers to give perspective budget, or influence the direction of the company. Your agile
to the backlog. This helps the development organization product roadmap, therefore, should be a visual, easy-to-
understand how the next few sprints fit into the big picture. digest document that your stakeholders can understand and
that gives perspective to your backlog.
A roadmap speaks in terms of epics and themes, while
the backlog represents the detailed features and other
tasks that deliver the product. In a sense, the backlog is a
translation of how your team will deliver the vision outlined in
the product roadmap.

Features of an Agile Roadmap

A roadmap should be agile and treated as a living
document—not a fixed plan. You should expect to regularly
revisit, discuss, and re-prioritize your roadmap based on
new inputs.

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 “
Today’s companies need to be agile,
move quickly, and be adaptive—and that
is really difficult with a static roadmap.
We believe that anything that is more
than just a few months out is fuzzy and
needs to change. We’re fast moving
and to be agile, it’s important to
have a living roadmap!
“
Jon Walker, CTO, AppFolio

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5
Typical Roadmap
Process Challenges
5
Typical Roadmap Process
Challenges
Why are product roadmaps so challenging? In our What are the primary objectives
conversations with product teams, we hear a common theme:
product managers are frustrated that their executives and
of your roadmaps?
other stakeholders aren’t on board with the product strategy. startups
Product managers want to convey the big picture but are
stuck in the weeds. help plan & prioritize

According to our product roadmap survey, the primary

objective of roadmaps for medium and large companies is medium-sized companies
to communicate product strategy. A secondary objective is
communicate product strategy
to help plan and prioritize. Unfortunately, these are the very
items that product managers struggle with the most.
large companies
Strategic decisions are essential for your product’s eventual
success in the market. But product managers today face communicate product strategy
several challenges—some organizational—in developing
roadmaps that are as effective as they could be. 0% 20% 40% 60% 80%

Let’s look at a couple of these challenges to creating effective

According to ProductPlan’s 2017 Product Planning
product roadmaps, and how to overcome them. These
Survey, startups reported that planning and prioritizing
challenges and solutions go beyond the roadmap document is the primary objective of their product roadmaps, while
and get to the heart of the process you use to develop larger companies said their objective is to communicate
the roadmap. product strategy.

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Challenge 1: Challenge 2:
Attempting to Lock in Plans That Are Prioritizing in The Moment
Too Long-Term

Many product managers build roadmaps with long-term plans It is the product manager’s responsibility—at an early stage,
that lock in deliverables—sometimes years into the future. when developing the roadmap—to create goals that drive
But in today’s era of agile development (and this is true of prioritization. The product manager must also prioritize
products in many industries—not only software), market the product’s development within the larger context of the
demands and opportunities, as well as new technologies, organization’s other initiatives that will be running in parallel.
often require mid-stream changes in a product’s development
or priorities. Building a prioritization framework into your product decisions
gives you leverage when faced with deciding whether to
This is why successful product roadmaps are designed as prioritize a stakeholder’s pet project or a feature required
living documents, focused on high-level product strategy and by a big prospect. Similarly, this step is vital to managing
organization goals—with built-in flexibility to adjust plans and expectations and ensuring that, when necessary, a team can
priorities quickly and easily. quickly switch focus to a higher-priority initiative.

This is also why your roadmap needs to effectively

communicate to all constituencies and keep milestones and
deliverables flexible, in favor of meeting the high-level goals
for the product rather than any specific deadline.

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6
Using Metrics to
Support Your Strategy
6
Using Metrics to Support
Your Roadmap
Metric-driven product management is the foundation of most describe their hypothesis, define a test, and measure.
successful products. But new products or features that are Product managers can do the same by setting goals and
on your roadmap are sometimes challenging because there then setting metrics for those goals. Although simple, this
is rarely a history of data. In other cases, if the product has scientific mindset is one of the best ways to guide new
recently launched, there might be a flood of data, but no products to success.
structure or focus on the right metrics to use.
For example, you might decide that a conversion metric
What are the right metrics that product teams can use to is important to measure—such as the percentage of trial
measure the potential success or weakness of a new product? customers who convert to paying customers.
Here are several tips for incorporating metrics into your
roadmap planning. Even without solid customer data, you can create a hypothesis
about what you think you will see and a target of what is ideal.
Define the Metrics Early This process itself is incredibly valuable because you’ll have
By defining the right metrics early, you can get better insight great conversations with the team about the business model
to guide your product decisions and your product roadmap. and will be able to spot challenges early on once customer
It’s a good practice to begin discussing success metrics as data begins arriving.
early as you can during the development of the product—and
well before it reaches any customers. Are You Measuring the Right Things?
Ultimately, the metrics you choose depend on the stage of
The Scientific Mindset your product, your industry, the type of product, and the size
In order to begin setting the right metrics and product goals of your company. But the most important consideration is to
early, you’ll need to think like a scientist. Scientists first focus on a limited number of metrics that really matter. These

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are metrics that tie back to the organization’s top-line goals Here are a few examples of metrics that will help you measure
and business results. success from a customer and business standpoint. Of course,
the metrics you select will depend on your business and
Avoid “vanity metrics,” those metrics that feel good but in the product. Choose only a few to start, so you can focus.
end are rarely actionable. For example, vanity metrics might
include website page views or the number of Facebook likes. Work with your team to get consensus on the metrics
In the end, these metrics rarely tie directly back to business that matter. Choose actionable metrics that tie back to
results or customer success. the strategic goals and initiatives you put on your product
roadmap. Revise the goals and metrics periodically; as the
Better choices would be metrics such as active users, product matures, the metrics will need to change and likely
acquisition cost, and average revenue per customer. These grow with it.
are metrics that make a difference to the business.

Sample Metrics for Your Product Customer success Business-oriented

and product metrics
If you don’t already have success metrics, how do you go
about finding the right ones? Product usage/adoption (sign Customer Acquisition Cost
in frequency, sharing, etc.) (CAC)
Begin by researching metrics discussed in your industry.
Whether you are in software, retail, media, or another industry, Percent of users who take a
Lifetime Value (LTV)
specific action that matters
there are experts who are discussing those metrics online.
Feature usage (usage Monthly Recurring Revenue
Look at information about competitive products—companies versus other features) (MRR)
that are publicly traded will often discuss metrics during
Which customer type is Annual Recurring Revenue
earnings calls. using certain features (ARR) per user

Generally speaking, business goals such as revenue, margin, Average Revenue per User
Retention or churn rate
and acquisition cost are good places to start. Customer- (RPU)

specific metrics such as product usage and retention are

Quality (e.g. average bugs, Conversion (e.g. site visit
good starting points as well. net promoter score) to lead conversion)

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Create Beautiful Roadmaps

ProductPlan is the easiest way to plan, visualize,

and communicate your product strategy. We believe
roadmaps are essential to create organizational
alignment and ship successful products. Our
intuitive features for building, managing, and
sharing roadmaps help teams across the globe
convey the big picture in one place.

TRY IT FREE

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