Innovation Roadmaps: What Are They Good For, Anyway?
At the heart, product roadmaps show the major milestones of a project’s lifecycle.
Maintaining Product Roadmaps is a useful discipline in just about any organization that has more than one product. But aside from capturing product timelines, what good are they? If a roadmap is just another deliverable you owe an executive, that checks a box on their need to be informed, it probably isn’t worth the time, nor is it of much overall value. When is a Product Roadmap valuable? When it addresses a critical topic for a specific audience. Product Roadmaps are most useful when they are focused.
|Focus Areas for Product Roadmaps|
What is a Product Roadmap?
A Product Roadmap is a graphical depiction of a set of product offerings. It indicates their major milestones, often highlighting product introduction, while enumerating key features at launch. Sometimes Product Roadmaps describe the relationship between your products, their price and features, and sometimes also include competitive offerings. They may also show relationships between your products, especially if they share a design platform, or if they have mutual dependencies. Roadmaps are often used by the Sales Organization in presentations to customers, to confirm that the feature they requested is ‘on the roadmap,’ or to give the sales team a persuasive argument to prevent a customer from switching to a competitor, since important new features are on the way. Frequently, Product Roadmaps are a guarded company secret and never disclosed outside the company as it would tip off the competition. Sometimes they are so guarded that the managers that need to see them cannot.
Product Roadmaps have many variants and are customized to address specific issues for particular audiences. Roadmaps deliver a benefit when they squarely address a specific need. When they address such needs, they can be incredibly powerful in shaping management discussion and decision making. These needs typically fall into the following categories: Revenue & Diversification, Portfolio Budget Allocation, Strategic Alignment, Project Synchronization, Market & Competitive Alignment, and Sales.
Revenue & Diversification
When Product Roadmaps include estimates (typically in a numeric field on the timeline) that define the potential incremental revenue attributed to new product launches, the organization can get a feel for the potential impact of the product on the top line. If products are grouped in product lines, or degree of inventiveness, then you can get a sense of the amount of revenue that will accrue in segments. These estimates can be very useful in understanding the amount of effort in new products or new markets to add to the core business. However, it is a challenge to estimate revenues for some products that are new to the company or to the world. You can either choose to use ‘Tee Shirt Sizing’ (High/Medium/Low) or assign revenue ranges (minimum, best guess, and maximum) to bracket the potential. Making some estimate, even if the error is high, is much better than no estimate at all.
Portfolio Budget Allocation
Typically, a portfolio is defined as a snapshot of the product lineup at a point in time. But managers might also define the product portfolio over time using a roadmap. If the products or product families are grouped by type (such as Core, Adjacent, and Transformational) then one can see how much a company’s activity supports existing products, or expands the reach outside the core, or how it addresses radical new areas. To understand the relative investments, there should be an entry on the map for each product that describes the headcount and expense budget devoted to that product’s development. Then, management should aggregate by type, and compute the overall investment for each type. Research supports a 70%/20%/10% mix for Core, Adjacent, and Transformational programs respectively. A Product Roadmap assists managers to make better decisions toward balancing the need to support existing products, with the imperative to expand the business.
Product Roadmaps also help to align spending on products or product families with the company’s strategic goals. Such a roadmap helps inform the degree to which these product activities are tied to the market intents of the company. Group together each product or family by strategic intent. For the case where a product aligns with more than one strategic vector, indicate this by a rating of the alignment in multiple areas. Examples of these vectors may include Market Alignment, User Alignment, Solution Alignment, and Brand Alignment.
This analysis lends itself to a matrix, with the rows linked to the tails of the product timeline, while columns represent strategic vectors. The cells may contain a binary “1/0” indication, or relative degree (H/M/L). Again, this is a useful tool to help managers fine tune the product set, optimizing around the strategy while verifying that the portfolio addresses the right strategic vectors.
This roadmap, like the others before it, provides the Technical Organization and the Marketing Organization with a useful reference point for planning. Since time is critical, this type of Product Roadmap clarifies the definition of milestones and the schedule estimates for hitting them. It helps teams plan so that they can avoid organizational bottlenecks that occur when many projects are at the same stage, all demanding the same skill types, often in short supply. It also helps indicate dependencies between projects. In this case, the roadmap shows linkages between one product and another, indicating exactly when one project needs a deliverable from the other. This is very useful for project managers who are trying to achieve predictable milestones, while maximizing speed.
This map is also helpful for looking at marketing activities outside the company. It also assists with the timing of product launches, so that customers (and Sales organizations) are not overwhelmed by too many at the same time. On the other hand, the connections on the roadmap may suggest where several products can benefit from a coordinated launch. For example, it may prove more efficient for the Marketing Organization to target multiple products for launch at a trade show, where reps can prepare customers to understand which of the new offerings are best suited to their needs.
Market & Competitive Alignment
If Product Roadmaps include in their vertical axis a cost or performance dimension, then they can help managers understand the relationships between products, on a scale of “Good, Better, Best.” If the roadmap indicates key features or performance variables for each product (typically a bulleted list), and the plot shows individual product timelines to scale on the vertical dimension, it is easy for managers to grasp the big picture and assess the relative price/benefit tradeoffs. Similarly, the vertical axis might have the dimensions of a key performance parameter (for electric vehicles it might be range, for example) to help inform a product family grouping or a pricing tier.
If the roadmap plots other companies’ offerings, then managers can see likely competitive advantages or challenges. It is important to use underlying technology cost/performance drivers to extrapolate and predict where the competition will be tomorrow (not today!). This roadmap is a tool to help set price and position – before the market sets it for you.
A final variant of Product Roadmaps is fundamentally different from the rest. The biggest difference is that this roadmap represents a view of the future that may be disclosed without harm. In other words, if the competition gets their hands on it the company will not suffer. Although Non-Disclosure Agreements with customers can limit this possibility, there’s always the risk that a roadmap will find its way into the wild. Therefore, a Sales-oriented roadmap should be low on details and vague about timing. The look and feel of this representation should reflect the brand; have a designer create it, just like any other piece of marketing collateral.
Often these roadmaps have illustrated icons or schematic representations to make the future products as real as possible – without giving too much away. The roadmap may indicate key points of difference, or Sales can communicate them verbally. These roadmaps are useful for collecting user input and stimulating discussion around desired features or functionality.
Product Roadmaps are good for many situations! They facilitate good discussion and enable good decision making. The first step is to define the problem you are trying to solve, or the kind of discussion you would like to engender. This will help your team generate the right kind of roadmap. By assembling the right information on your roadmap you help to make sense of the relationships, as well as the relative investment, timing, and results you can deliver. Since it takes time to collect, analyze, and present the data, focus your road maps on the most important issues – and go deep.
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John Carter has been a widely respected adviser to technology firms over his career. John is the author of Innovate Products Faster: Graphical Tools for Accelerating Product Development. As Founder and Principal of TCGen Inc., he has advised some of the most revered technology firms in the world.
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