Outcome vs Output Product Management

The term 'product mindset' has become a popular buzzword in the design and technology industries, however, many individuals view it merely as creating a flawless solution for their users without understanding the root cause of their frustration."

So what does it mean to have a product mindset anyway?

While passion is often the key to a great product, it's important to remember that no amount of expertise can help you create a great solution if you don't have an accurate understanding of the problem that you are trying to solve.

A product Mindset is about solving user problems that create real value for customers. It's about more than just building features quickly, shipping them into the market, and assuming the problem doesn't exist anymore.

Constantly asking "why" has led to extraordinary moments, like the landing on the moon. Plus, agreeing without questioning can lead you to endless product release cycles.

And when you fully understand this, you start focussing on outcomes (product-led growth) rather than short outbursts of outputs.

But what's the difference?

Difference between outcome and output in product management

In product management, it is essential to understand the difference between outcome and output.

The outcome is a product's result or impact on its intended users, while the output is the product or feature itself. In other words, the outcome is the "what," and the output is the "how."

One way to think about the difference between outcome and output is to consider the difference between a hammer and a nail. The hammer is the output – it is the physical tool that is used to drive the nail. The outcome is the result of using the hammer – a nail that is securely fastened to a piece of wood. In this example, the nail is the outcome, and the hammer is the output.

Outcome-driven product management focuses on the product's impact on its users. This means that product managers should be more concerned with the "what" rather than the "how." They should ask themselves questions like "What problem is this product solving for our users?" and "What benefits will our users get from using this product?"

On the other hand, output-driven product management focuses on the product or feature itself. Product managers who are output-driven may be more concerned with the "how" rather than the "what." They may be more focused on the technical aspects of the product, such as how it is built or works.

There are pros and cons to both approaches to product management. Outcome-driven product management can help ensure that the product is meeting its users' needs and making a positive impact. However, it can also lead to a need for more focus on the details of the product itself. On the other hand, output-driven product management can ensure that the product is technically sound, but it may not always result in a product that meets the needs of its users.

Product managers should strive to find a balance between outcome and output to be successful. They should consider both the impact the product will have on its users and the technical aspects of the product. This can help ensure that the product is both practical and functional.

The problem with managing your product through the lens of feature requests (outputs)

Product companies focusing solely on outputs – delivering specific features and products – can often be referred to as "feature factories." This term is used to describe companies that prioritize the development and delivery of new features over the product's long-term success and the needs of its users.

In product management, it is common for teams to focus on delivering specific features and outputs. While a research-backed execution does not harm, a lack of it can lead to problems in the long run.

Here are a few issues which can arise when managing a product through deliveries and features:

1. Lack of focus on user needs

When the focus is solely on delivering specific features, it's easy to lose sight of the bigger picture and the needs of the product's users. This can lead to developing features that may not be necessary or that do not solve the users' problems.

2. Inefficient resource allocation

It can be difficult to prioritize tasks and allocate resources effectively when delivering specific outputs. This can lead to the development of unnecessary or low-value features while more important tasks should be addressed.

3. Lack of long-term vision

Focusing on outputs can also lead to a lack of long-term vision for the product. It can be challenging to see the bigger picture and plan for the future when focusing solely on delivering specific features.

4. Decreased user satisfaction

If the product meets its users' needs and solves their problems, user satisfaction can improve. However, this can ultimately lead to decreased customer loyalty and decreased business success.

Why should B2B SaaS companies prioritize outcome in product management?

Most B2B SaaS product companies nowadays are knowingly or unknowingly shifting towards becoming feature factories. It would help if you asked better and bigger questions to pull yourself out of this loophole.

The outcome is the result or impact that the product has on its intended users, while the output is the product or feature itself. While both are important, outcome-driven product management – focusing on the impact of the product on its users – should be prioritized over output-driven product management.

Here are a few reasons why:

1. Outcomes align with business goals

When a product is successful, it should be able to meet the needs of its users and solve their problems. This can lead to increased user satisfaction, resulting in higher customer loyalty and ultimately driving business success. Focusing on outcomes can help ensure that the product is meeting these goals and aligns with the overall business strategy.

2. Outcomes drive innovation

Focusing on outcomes can drive innovation by encouraging product managers to think creatively about solving users' problems in new and innovative ways. This can lead to new and differentiated products that stand out in the market.

3. Outcomes improve the user experience

Ultimately, the goal of any product is to provide value to its users. Focusing on outcomes can help ensure that the product is meeting the needs of its users and improving their overall experience. This can lead to increased user satisfaction and loyalty, ultimately driving business success.

4. Outcomes lead to long-term success

Focusing on outcomes can help ensure that the product is meeting the needs of its users in the long term. This can lead to sustained success as users continue to use and recommend the product.

How do you ensure your company is outcome-focused and not just another feature factory?

1. Clearly define business goals

‍The first step in becoming more outcome-focused is to clearly define the business goals and objectives the product intends to achieve. This can help ensure that the product is aligned with the overall business strategy and can help guide decision-making throughout the development process.

2. Understand user needs

‍To develop a product that has a positive impact, understand users' needs and pain points. It can be done through user research, testing, and gathering feedback from existing users.

3. Prioritize tasks

‍Once the business goals and user needs are understood, it is important to prioritize tasks and allocate resources accordingly. This can help ensure that the most critical tasks are addressed first and that the product is meeting the needs of its users.

4. Regularly review progress

‍It is important to regularly review the product's progress and ensure that it meets the intended outcomes. This can be done through user testing, gathering feedback, and tracking metrics such as user satisfaction and retention.

5. Encourage a culture of continuous improvement

‍To become more outcome focussed, it is important to encourage a culture of continuous improvement within the organization. This can be done through regular meetings and reviews and by encouraging open communication and collaboration.

Do you focus on outputs or outcomes?

While output-driven product management – focusing on the technical aspects of the product – is also important, it should not be the sole focus.

By prioritising outcome-driven product management, product managers can ensure that the product is meeting the needs of its users and driving business success in the long run.

Suggested Read: What Does it Mean to be a Product-led Company?

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