AIB Guest Lecturer: Daniel McPherson

AIB Guest Lecturer: Daniel McPherson

As the practical business school, AIB invites practical industry leaders to speak to on-campus students at its local Adelaide campus. Students had the opportunity to learn about New Product Management from Daniel McPherson, Chief Technology Officer at Rapid Circle.

With more than 17 years’ experience in the software industry (most of it spent at Microsoft), Daniel has launched his own business that has today grown into a global team of 70 people specialising in solutions to help people in large organisations work better together.

Speaking at a recent AIB weekend workshop, he shared his top tips for building a start-up company based on his experience and the evolution that has taken place between the first generation of products launched in 2012 to now.

In setting up his own business, Daniel was never short of ideas, and quickly found the benefit of having only one very good, small, and simple idea.

“Ideas are the easiest things to come up with, ever – day in, day out, we battle with ideas all the time, and there is no end to suggestions, recommendations or feedback,” Daniel said.

“If you are faced with a decision and you must choose between two options, bias yourself towards the simplest, most easy to do option,” he said.

“Even if you take the simplest possible path, it’s going to turn out to be complex enough for you, your team, your sales team, and everyone else involved.”

Another rule of thumb he’s learnt to stick with is the 80 – 20 rule, designed to ensure the team delivers 80% of what the customer wants by focusing only on what’s needed.

“When you are working out the requirements of the product, if the function is outside of 80% of the most important capabilities of your product, then it is a very bad investment – the extra minute you spend working on it is not going to deliver on the functionality you should be aiming for, for your customer,” he said.

“You will also find that you don’t know what the final 20% is going to look like yet – not until your customers start using your product. Up until that point you are very poor at predicting that final 20% functionality.”

Watching how customers use the product is a big part of finding out more about the final needs of the product, according to Daniel, who said that while feedback can be helpful, customers don’t usually understand what they want or how to implement it.

“We have to see how many times they’ve clicked on that page in half an hour, or ask what’s missing on a page when they navigate to it and click ‘cancel,’” Daniel said.

Another tip was to focus on product marketability rather than just the customer’s needs, so the product can later be commercialised, making it a long-term investment for the business.

“Over the two years we spent building products for Logica and Shell we never took a chance to sit back, plan our own product features, and prioritise what the market wants rather than just what these two larger companies wanted,” Daniel said.

“This time around, we are trying very hard not to be aware of a single customer – to make a product that is a fit for the market, and not just Shell,” he said.

“The way we are doing that is trying to be a bit more upfront with the customers we have, telling them ‘I know you would like that, but you are just going to have to wait.’ The funny thing is, they are okay with that. You are so scared that if you say ‘no’ to them, they will ditch you or go somewhere else, but that is not what happens.”

But the process is ongoing, and can often be improved by A/B testing with specific audiences in a similar way to Facebook.

“They don’t have Facebook Version 17 – they are just constantly changing and initiating products, and watching what people do before designing software based on it,” Daniel said.

“That is the way forward in software – no versions, just constantly looking for improvement.”

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