Product Line

Rethinking The Product Line

How to Improve Your Product Line’s Performance

A product line is a collection of related products. But let’s be clear. There’s only one reason to create and organize a set of products into a product line. It’s to boost their performance.

Managing products as a line should deliver better results than when you manage the products separately.

Forming to Perform

Most often, companies don’t bundle existing products to create a new product line. Instead, product lines form by growth and addition. One product is added to another, and variants are added to those. Over time, the product line offering expands. But many managers stumble when working to make their product lines perform better. They find that adding more products doesn’t always help.

If you wait until after you develop a product or form a concept, you may find yourself too late to drive improvement. This is a harsh lesson to learn. Those products and ideas pushed into development may look great as individual offerings. But when added to the line, they can be a burden. Improving a product line’s performance demands more than a linear approach toward discovering and developing one product at a time.

Product Line Performance

To find out how to improve a product line, let’s first explore performance. What does it mean? And with that understanding, let’s look at how to get it.

A product line’s performance is characterized by three dimensions. In no particular order, the first is customer satisfaction. The second is free cash flow. And the third is competitive position.

In the past, performance depended on all three dimensions to be positive. In school, we were taught how to drive and judge such positive results. We learned skills like how to calculate cash flows. And we learned how to design features to match customer needs, and how to move products into markets to improve competitiveness. But in high-tech and platform enabled industries, we see that sticking to the all-three-positive rule proved wrong.

Recasting Product Line Performance

Consider Amazon’s successful approach. Their goal was to grow their online retail business. Plus, they needed to build scale in web services.

Amazon made a choice that many stock analysts viewed as foolish. They didn’t want managers to emphasize free cash flow. This approach was counter to the accepted rule that companies must pursue all three performance dimensions. And it resulted in years of negligible earnings.

But the bold move allowed Amazon to invest in the other two performance dimensions. And the results have been striking.

The move was brilliant. And while the approach demanded as much marketing and financial finesse as it did systems engineering, it also proved fatal for many retailers and web services.

Amazon proved superior performance does not mean the three performance dimensions must advance in unison.  And this is a big lesson for product lines.

Apple also changed our thinking about performance. Their approach showed us that product function and placement aren’t the sole determinants of success.

Apple had a brilliant insight. They realized they could affect customer satisfaction and competitive position with forces that extend beyond the products in the line. These were forces like community, brand, and content.

Apple understands that design and distribution are crucial. But consider their competitor. Samsung’s Galaxy phone line continually falls short of Apple’s iPhone line even when Galaxy phone features are equal or superior.

Beyond The Single-Product Approach

Today, improving a product line demands new thinking. Amazon and Apple prove it. But many companies don’t realize there’s a better way to drive product line improvements. Instead, they’re stuck with a traditional, single-product mindset. And by continuing the old approach their product lines become vulnerable to an enormity of changes.

The problem is that today’s markets, technologies, and competition are more dynamic than in the past. If you wish to advance your line, you’ll need to recognize and understand the dynamics from a multi-product view. Those dynamics and products create a system of parts and forces that comprise the line. When you wish to improve a product line’s performance, you must drive the product line system. And you’ll find that single-product thinking never takes the whole system into account.

Amazon and Apple clearly showed us how performance dimensions matter. But they also showed an adeptness at influencing and driving their product line systems. The reason for their extraordinary success becomes clear only when you see the parts and forces of each of these company’s systems.

The challenge managers face in learning product line systems thinking is that the single-product mindset is ever-present. Look for yourself.

What Experts Get Wrong 

If you visit the web to answer your questions about product lines, you’ll see several definitions and explanations. But most descriptions are both old and ill-suited to today’s business environment. Consider the major disconnects.

More than a Product Roll-up

  1. A strong product line, one that delivers superior performance, is not a simple roll-up of many good products. Yet that’s what some product line definitions imply.

These definitions are based in single-product thinking. It suggests innovations and new products  stand on their own. But in the real-world, a product line’s performance depends on the products and their relation to one another. Plus, there are many forces that interact with the products and the relationships. Creating and selling one product can help to develop and sell other products. The connection across products matters as much as each product’s existence.

Also, a myriad of internal and external forces affect every product line. Influencing and responding to these forces makes up most of the work that product line teams must undertake every day.

A Brand is not a Product Line

  1. A product line is not always synonymous with a brand. Still, that’s precisely what some definitions will tell you.

The notion of a one-to-one relationship between a brand and a product line comes from traditional consumer products thinking. But much has changed. A more modern and powerful view is that product lines act as a system of objects and forces. One or more brands can act as forces within the product line system. And a strong brand can be a powerful force, just like Apple’s iPhone brand. But advancing a product line’s performance demands more than smart brand management.

Product lines can support and drive multiple brands at the same time. Consider how big consumer brands also produce products for store brands. They do this to build production leverage, another powerful force. Yet the product line’s total performance depends on how well the company orchestrates all of its objects and forces, including brands. This is true for both consumer and B2B products and services.

More than Marketing

  1. Orchestrating Product Line improvement demands far more than just marketing skills. Yet when you read about product lines on the internet, you’ll see most postings only communicate the Marketer’s view.

Advancing a product line calls for competence and collaboration across:

Technology Engineering Design

Research

 

Strategy Planning and Execution
Process and Project Management Idea And Concept Targeting And Generation Supply Chain Systems Integration Regulatory
Manufacturing and Operations Sales Service Intellectual Property Marketing And Customer Insights
Brand Management Finance Human Resources Portfolio Management Waterfall and Agile Development

Improving a product line takes superb marketing skills. And it also requires in-depth knowledge and sharp skills across other functions to drive the system’s objects and forces. But the most important yet least discussed skill is the ability to orchestrate organizational change. Product line improvements always call for change in how functions support the line by pushing on system forces and parts. If you can’t achieve the change, the system’s improvement is unlikely.

Innovating a Product Line

  1. Innovation takes an interesting twist for Product lines. When you read most websites, you’d think product line innovation is a simple roll-up of individual product innovations. But such innovations don’t always drive product line improvements. From a product line view, the single-product innovation approach appears as an adventure in serendipity not as a journey to improve the system’s performance. And that’s not productive.

A key to product line performance is to seek innovations that boost many if not all the line’s products. It’s targeted or purpose-driven innovation that cuts across the product line systems parts and forces.

Innovations deliver performance gains when a company deliberately focuses on its product line as a system. It’s not to innovate products singularly and then place them in the line. You’ll find that when communicated properly, most leaders see the system. But sadly, few organize and build a needed focus to innovate across the product line system.

Not the old Single-Product Mindset

  1. You’ll also find websites describe roadmaps and strategies based on a single-product mindset, absent of systems thinking. Unfortunately, this approach is wrong for medium- or large-size companies. Few of these firms can operate in a single-product mode. These companies must advance whole product lines, not just one product. And they must advance their lines continuously.

After you embrace the multi-product mindset, traditional single-product approaches will look flawed. And once you see your product line as a system, it will be difficult to return to single product thinking. A warning flag will rise when a product expert declares the greatness of an old approach.

The challenge is that single-product thinking seems sound. Of course it does. That’s why it lasted so long. But in today’s world, the results are not so great. Consider when an expert says how Samsung will only beat Apple when the Galaxy’s technical features are superior to an iPhone’s. I guarantee that Samsung wants the superior features. But would you base your future on being successful with the approach and not advancing the full product line system?

The Product Line as a System

If you wish to dive into Product Lines as Systems, you’ll need to learn three cornerstone topics.

System Parts (see more HERE)

System Forces (see more HERE)

System Flows (see more HERE.)

And here are definitions to help anchor your thoughts. HERE.

Click here to see a Google search revealing what others say about Product lines.

Begin Improving Your Product Line

Building a systems view is a significant step forward for product line teams. The great news is that it’s teachable and doable. I encourage any team seeking improved performance to reach out to me and learn more.

Please contact me HERE. I will share how to set up the learning specific to your product line and ramp up your improvement journey. Major gains await you and your team.

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