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In this episode of “The Business of Product,” Patrick Carmitchel, VP Product Management, discusses XaaS Portfolio Lifecycle Management at Scale with Laura Fay, Vice President & Managing Director, Offers Research & Advisory, TSIA and Bill Noel, Group Vice President, Portfolio and Programs, Blue Yonder (formerly JDA Software).
Listen to this podcast to discover the challenges, best practices, and recommendations from industry professionals and enter your insights below in the comments section. You can also join community discussions to network with your peers and discuss topics like this one at our new TSIA Exchange.
00:01 - Introducing the interviewees, JDA Software and the topic of lifecycle management.
02:21 - Bill explains his career in product management
03:23 - The portfolio lifecycle management process at JDA Software
05:35 - The differences in the portfolio lifecycle management in SaaS vs traditional software
09:48 - Challenges with buy-in for new portfolio lifecycle management process, change management and data availability
15:22 - Observed industry practices on change management, SaaS business model knowledge and analytics
17:56 - The importance of data consistency
18:51 - JDA’s timeline to success of the new SaaS portfolio lifecycle management process
20:31 - Cross organization engagement beyond product, sales & support
22:41 - Celebrating the customer value realization, not just the first sale.
23:00 - The increase in customer centric culture
24:00 - JDA’s transformational journey to SaaS
25:57 - (More on) cross functional engagement
27:31 - JDA’s lessons learned in establishing a new SaaS portfolio lifecycle management
30:32 - Wrap-up
You’re listening to the Business of Product where product leaders are empowered to transform technology and services. We're here today with Bill Noel, group vice president of portfolio and programs at JDA and Laura Fay, vice president and leader of X-as-a-service product management research at TSIA. We decided to pull Bill and Laura aside today at Technology and Services World at the Aria in Las Vegas just before Bill's upcoming session: Conquering XaaS Portfolio Lifecycle Management at Scale.
Thank you both so much for taking the time today. Why don't you tell us a little bit about yourself, Bill, and a little bit about your company, your background, and how you ended up in product management.
Sure. JDA Software is an enterprise software company that specializes in supply chain software. We're about a billion dollars in revenue annually, 5,000 employees, privately owned by private equity right now, and on a growth trajectory with a lot of innovation going on. Really net new products coming to market.
My role is in the product organization, overseeing all of product operations as well as all of our cross-functional and portfolio processes across the company. I've been with JDA for a couple of years. Before that, I spent over 10 years consulting for PRTM and PWC doing innovation consulting for high-tech companies and outside of that about 15 years in the industry and various technical roles.
Excellent. Thank you. Laura, you wanted to have Bill come on specifically to talk about what's going on with his session. Why don't you tell us a little bit about that session?
The membership of the research practice and product management or product operations ask a lot of questions around portfolio investment, life cycle management (what should we be doing?), and as-a-service (does that look different from traditional life cycle management?). This was a great topic to talk about at the conference and Bill graciously agreed to share what he had been doing at JDA in this context. JDA, under Bill's leadership, has revamped some of their portfolio life cycle management. I thought it would be a great opportunity to have Bill share with the community what he's been doing on that.
So Bill, how did you get into product management?
I got into product management as part of getting an MBA early in my career and then made it a focus area as a consultant helping technology companies build out their product management capabilities, and evolved to be more software-centric and service-centric as the industry went that way. As I got to JDA, I've taken on more of a coaching role for our product managers and our team internally to help them bring that outside-in thinking, bring that service and SaaS thinking into JDA's business, which is 30 years plus in longevity and in the middle of a strategic pivot to SaaS. There was a need for a lot of injection of new thinking and new ideas and how we go about product management, how we think about it, and how we executed as a company. And especially the cross-functional dynamic that goes with that.
Why don't you tell us a little bit about the new portfolio life cycle management process that you recently introduced at JDA?
The new process is born out of recognizing that looking at products discreetly, looking at them in the software world on a release-basis, really underserves the entire need of the business by three quarters. When I started in the role more than a year ago, we had a process that was very much a waterfall-flow. It was born out of discrete products that have a start and an end rather than SaaS products that have a long life cycle and need to be continuously managed, almost independent of where you are in any given release. And so we introduced at the beginning of this year the idea of what we call P2T2 - program, process, team of teams. The idea is to build on the concept of "Team of Teams" that was in one of the books from Andrew McCrystal that brings the cross-functional group from across the different silos together and has them own a portfolio from start to finish of the life cycle.
So whether that's a strategy, a go-to-market, or end of life; whether that's professional services, cloud services, support - the entirety of everything that you need to worry about for that program, that portfolio, is now put on the onus of one cross-functional team of about eight people under the leadership of the product manager for that part of the portfolio.
We rolled this out at the end of Q2 this year after having gone through a cross-functional design process. Now we're in a steady rhythm of review, revise and extend the best practices as we're learning it. But coming back to your original question of why: we found we weren't doing that full life cycle service and it was causing gaps and siloed behavior across the company.
Laura, you wanted to shine a spotlight on this particular process that Bill introduced at JDA. Can you tell us a little bit why you think that's an approach that is important for the product management community at TSIA?
Yeah, I think this whole area of product operations is critical when you move into as-a-service to think about it a little differently. I've just completed some primary research in this particular area and what jumps out from it is the gap between this whole continuous management of products and market and making them successful. But we've yet to establish, as an industry, a practice around in-market success reviews.
We're very focused still on what I'll call NPI - getting a new product, launching it into the marketplace and then going, "Great, it's now launched." But when you recognize that the majority of the revenue is going to come after the first sale and it's a continual process of adoption and renewal and expansion, that's a new muscle that organizations are likely to want to create and strengthen over time.
One of the things that go with that is the need to even manage margin more once you have the launch. Building on what Laura said, coming back around after you've launched and you're having success, what are the margins? How do you optimize the margins and prioritize the enabling of that in the product to lower your costs? Especially in technology, there are levers you can pull there if you fully understand the in-market performance, but that requires thinking about that full life cycle. Everything happens after launch, so you need to think about it in that way.
With as a service, it's a combination of doing some things differently, but it's more about the "and", right? You've got to continue to do what you've been doing to get the products into the market but now you've got to add on this oversight of the success in the market. Would you say, Bill, that there are some additional things that you guys have done in terms of metrics that you monitor?
Yeah, we're looking at that and operationalizing it really as we speak. One of the items is the margins. We have some of our products that are a little bit older - two or three years old - and the life cycle from a launch that is native SaaS that has half or less the margin or the cost structure from an operating perspective than the newer ones have. We're able to see that delta and then prioritize as we go forward.
Another one is thinking about the "try and buy" aspect. A lot of times when you're first getting a product to market, you're not thinking as much about that. You just want to get the thing that solves a market problem, but then you have to consider "How do I enable it so that it's easier, more attractive, and I can entice people with it," as opposed to some longer sales cycle that is more cumbersome.
Are you talking about the role that the product itself plays in the trial process and creating product-qualified leads?
Yes, and even the back office stuff! Are you unable to take a credit card? Do you protect the information the way you need to? A lot of our products are very complex products. How can you create a scenario that minimizes the complexity to allow a customer to try it in a way unique to them while still maintaining the product as it is? That's a tool that's uniquely valuable in the sales cycle and isn't necessarily valuable in operations but can help you to get a lot more at-bats and a lot more proposals.
With this introduction of a different process for portfolio management, what were some of the challenges that you came into while trying to get buy-in or implement this new process?
Well for us the buy-in at the conceptual level wasn't too hard. We had pre-socialized it with a lot of leaders. At a surface level it's, "Yes, life cycle management sounds good. Let's do that!" What would you object to, right?
The challenge comes when you're making it real and even with basic stuff. Do you have the right amount of people with the right perspective in the right roles to be able to engage? We have 17 programs that require cross-functional teams, so with the eight different roles we have on the team, we had some of those pretty well-defined and available. But some of the roles it was like, "Hmm, we have this person who is on the team but their remit is a North America remit for this small portion of the portfolio and we need them to take a global perspective."
Well, that's hard for them to do in their day job. So is the solution coaching or do we need different people? Those were some of the challenges we faced as the organization reacted to the expectations of the model and figured out, "How do we staff [the organization] with the right people with the right amount of time," such as if it's three to five hours or something a week that we want them on these teams. One group had given me five people and they were each on four or five teams. There was no way that was going to work. We're going through those kinds of learning curves and then revisiting it with the leadership.
In some cases, we need to lay out a plan of how we create the right staff, and in other cases, we can get other people to play the role. Those are some of the key challenges that we've had in the first several months of rolling this out.
Thank you for taking the time to tune in. We will continue the interview in just a moment but before we go ahead, I want to make sure that our listeners know how to access the presentations from today's session. If you are an attendee at TSW Las Vegas, for the next 30 days you'll have access to all presentations on TSIA.com/conference.
If you're a TSIA member with a XaaS Product Management research subscription, you can go to TSIA.com anytime, sign in and access the Member Resource Center. There's a whole lot there for you, including all presentations from the conference.
Let's get back to the interview and talk a little bit about what you hope people take away from this in terms of the key success factors and lessons learned.
There are a few things. One is, as we talked about earlier, the executive buy-in and the change management side of things. You're not going to go anywhere unless you get that buy-in and ongoing support, which we've been fortunate to have that from the top down.
The second key factor is the people that you bring in and the expectations you set for those people. You need people that can play a global role as opposed to regional players or niche players that you may find in a lot of companies similar to ours. Many times, we need to have them step back and take that broader perspective.
A third key factor would be around metrics and data. A lot of this stuff requires visibility and really easy access to the data. If you don't make that easy for the teams or if they have to spend a lot of time finding the information, creating reports, doing any of that, it just shuts down the whole thing before you get started because you're spending time on minutia and not doing the value-added part that you want them to do.
Those are some of the key success factors. In terms of lessons learned, the change management of this is going to take a bit longer than what I had hoped originally. I was thinking it would be the second half of the year. I think it's pretty easy to say it'll keep going at least through Q1 this coming year  to get everybody fully embracing and embodying it. We've got to go through the cycle of the different reviews and learnings several times before we'll get to some kind of steady-state.
Another thing that was a key lesson learned that we're in the middle of right now is that we designed the process for 90 plus percent of the portfolio, which is around these steady-state programs that have an ongoing business and an ongoing rhythm. What we didn't design it for is the handful - two or three - of major strategic initiatives that we launched net new at any given point in time that have a completely different life cycle.
If you think about a 1.0 product, it doesn't have that full life cycle and it needs a waterfall approach. It needs the stricter approach and the governance until it gets to market and then can worry about the life cycle. We're having to go back and design and identify what kinds of strategic things are big enough that we want to put it through that kind of a process flow to maintain a rigor over those two or three at any point in time - big strategic initiatives that we need in the portfolio and have the right governance and the right visibility on it. Those are a couple of other things that we're still working through and learning from.
It makes me think about the reality that it's not just being in product, but what is happening is people try to figure out just about everything as a service and how much change management is required, specifically on the product side of the house.
I'm curious, Laura, what you're seeing [across the technology industry] in terms of the capabilities to manage to that [change management] or the knowledge of how to do that.
One of the things that I'm seeing extensively even beyond the life cycle management side of it that permeates everything is that there's a big opportunity to close a knowledge gap in as-a-service with product management communities in general. It's clear that the business model of as-a-service is very different from the traditional business model, but there's a gap [in understanding] in how companies make revenue.
For example, what are all the puts and takes in the ARR (annual recurring revenue) formula? What I see is that most product management communities would fail the test if you ask them to lay that out. I think that's a big opportunity where if they understand how you make revenue in as-a-service, you would probably be amazed at how innovative that those teams can get around designing specifically for that cycle. Conversely, if you don't understand it you're probably not optimizing what you're developing to accommodate it.
Another area of opportunity is clearly in analytics. JDA does a pretty good job on the analytic side because, in the supply chain, you live and die by the data. We [TSIA] see, across the board, many companies are challenged in that. We're pretty good as an industry, I think, in measuring license activation and people clicking through the product, but when it gets to the depth of usage and measuring the journey to product stickiness, we have a gap there. Then when we start talking about measuring tangible value or measuring outcomes in a quantifiable way, and it drops way off. Those are our growth areas and foundational components of understanding what it takes to put the product in solutions in the market and have them successfully growing over time.
While we have a plethora, a wealth of analytics in our products, in some ways the measure of the service and the stickiness and the adoption are areas that we are continuing to grow in. One of the things, especially in a portfolio company like JDA, that becomes an additional wrinkle is the consistency of those so that you can operationalize them. If they're not all measured the same and we have a history of a dozen or more acquisitions with different kinds of codebases, different technologies, different longevity, it makes operationalizing things hard to take advantage of and know what they all mean. That's a different level of discipline and consistency than a lot of companies are used to when you want that autonomy.
Since implementing this new approach to portfolio product management across JDA, how long has it been and are you starting to see some early signs of success?
We're probably three to four months into having the initial rollout. I would say it's early to declare any kind of victory, but I am seeing and hearing of a lot deeper collaboration, especially between some of the teams that haven't necessarily had their seat at the table. At the two-month mark, we started a series of checkpoints with some of the leadership on each of the teams to see what's working and what's not working. We did a survey and now we're propagating some of the best practices that some teams have organically created and are using and propagating it across others.
One of the successes that came out of one team was that they, of their own accord, decided they needed to have bi-monthly town halls. They invited all of the field teams, the salespeople, presales, professional services that are practitioners in their domain and have a roughly two hour, interactive call to share what's going on, where the roadmaps are going, and answer questions. Nobody had any pattern of doing that prior, and it came out of this team organically coming together and identifying needs that they saw. Now, we're propagating that expectation across the other teams to try to drive that message, consistency, and enablement across the portfolio.
Bill, you mentioned these new processes enable some people to come to the table that didn't have a seat prior. Can you elaborate on that?
Sure. JDA is very much a sales and product-led team. Folks from marketing, folks from customer support, folks from professional services - they've historically not been as included all the way along. Even the product managers and the PR and sales folks haven't always been on the same page together.
Now as we bring these teams together and put the expectation on the team that margin matters, cloud quality matters, uptime matters. All these different kinds of measures are a burden on the cross-functional team as opposed to each functional silo owning pieces. That's creating a huge, different dynamic. Even on a call today, that topic came up about how we're going to leverage these teams to push a specific message around quality and uptime and serviceability and all of these issues that were never top of mind previously.
You go to a product manager and it's always about the features and what widget you're going to enable next. It's not about "How am I going to make my support people's job easier? How am I gonna make it easier to diagnose, easier to deploy, et cetera?" Now because of how we're putting these expectations on a cross-functional group of people sitting at the same table together, it's changing the dialogue a bit and it'll take a bit of time, but it's coming along.
Laura: That's great. Would you say it's shifted to take more of that outside-in perspective and factor in the things that are going to happen when the customer takes to the solution?
Exactly, and we've had a shift internally that reinforces that. We used to have emails that would go out about some big customers in the go-live. Now what we're seeing is the value realization. After they've gone live and we've come back six to twelve months later and measure the value, then we're having a celebratory email announcement go out about that.
Even at a company level, we're shifting the dynamic to be more about that full lifecycle, inclusive of the product, customer, operations, all pieces of it.
Patrick: That validation of the value that's being realized, is that happening through a cross-functional team or connection to customer success reporting back to that?
Bill: Yes, it comes through the customer success team because they are the accounts-centric, customer-centric group. In our world, that could be a multi-portfolio implementation where they bought four or six different pieces of our portfolio and implemented them all as one or it could be more narrow than that. That's the point at which we translate from the end customer back into our portfolio to then be able to say, "what's the relative value distribution across the portfolio from a given customer situation?"
That sounds great. So it's bringing more of that customer-centric perspective up earlier on in the value creation cycle.
We're in the middle of a journey to be more modern customer success oriented. We've put a lot of emphasis on it in 2019 and hopefully will start to see the fruit of that in 2020 as we shift to having true customer success managers on all the key accounts and having that be built into our model. In 2018, that wasn't part of our model so that's another part of the shift that we've been doing over the last couple of years to drive more towards that modern service orientation and with full customer success managers.
How frequently do these cross-functional teams meet up?
Weekly. One of the things that might also be a little different about JDA is that is we're in the midst of this shift to SaaS. If you went back two or three years ago, 10-12% of our bookings would be SaaS. This year, it'll be over 50%, so there's been a huge transformation towards SaaS.
The second thing is that if you go back to 2016, our investment in R & D was about 85 - 90 million versus 150 million this year. Clearly a huge investment in net-new innovation. We have a massive shift going on, we have a massive amount of investment in innovation, we have a transformation in all different dimensions. There's a lot of change going on and we threw in an acquisition late last year just to make it even more interesting! With all of that going on, there's a lot to do in terms of cross-functional coordination and execution.
When you think about these cross-functional teams meeting weekly, and you've certainly got a lot of transformation in process, do you feel like you have the right balance of oversight there? Could the amount of oversight be overkill or do you think it's at the right level?
There are different levels of oversight. At the team level, this is just part of their day job so nobody is joining those meetings other than that team. I don't view that as an oversight role since it's just team operations.
What we do have for oversight right now is a governance moment with each of the teams three times a year. In Q1 we'll do a review of the plan for the year and then we'll do two additional checkpoint reviews for the year. Those are each one hour in length, so we have just three hours of overall cross-functional oversight for the entire year. That feels like a pretty moderate investment of oversight.
Once a month, we also have a three to four-hour governance review where we'll go through several programs at a time. For now, nobody's saying that we've swung the pendulum too far in that direction.
Excellent. We're coming to the end of our session, but before we go can you tell us what advice you would give to other product managers that are in a challenging situation? They're going through transformations. They're trying to manage a portfolio or multiple portfolios that are complex varying life cycles. JDA has a pretty big span of up to 20 plus years in the product life cycle, but what do you tell somebody else that is looking at trying to improve their efficiencies?
There are a few different ways you can approach this kind of effort. We've spoken mostly about the team-level dynamics in the life cycle. We didn't discuss the element of it that is above and beyond the team. That's the investment level.
Looking at it from a portfolio perspective, what's the investment? How do you decide to dial up or dial down? There are different places, depending upon the people involved and their roles, that you can potentially weigh in on and you have to pick where your ability to influence and drive is.
If you're an individual product manager in charge of one team, you can try to rally your cross-functional peers to embrace this kind of outside-in, customer-first, market-first, end-to-end thinking and potentially have a fair amount of success within that ecosystem, but you need to get your peers to buy-in.
If you're a higher-up in the organization, you can try to drive something more systematically like we've had the opportunity to. If you don't have the buy-in for that full cross-functional effort, you can focus more at the investment level to start and make sure that investments are getting balanced in the right way across the portfolio, tuned in with where they are in their life cycle and the market opportunity associated with them.
The place to start can be tuned to where your opportunities for influence and the highest areas of need for the organization are. We started late last year on the investment side to make sure we got that right and then we evolved from there because we were able to do that with a smaller group of people and affect that change and then we started getting more into these broader process domains.
Is there anything looking back on this process that you would've done differently? If you had to pick one thing.
I think I would have pushed harder to identify the right people on each of the teams earlier. We made do with who we had, even though we had socialized it. I should have pushed harder in the sense of, "No, it's going to be different. No, this isn't going to work. No, I need you to give me the right people up front." It took a couple of months to get everybody bought into the mindset of "Okay, this is different and we have to do things differently." So I probably could have pushed harder on that one in hindsight.
Great, thank you. I'm looking forward to your session today. I do not doubt that you're going to get lots of great questions from the audience. This is a topic that everyone is quite interested in.
That's it for today's session on Conquering XaaS Product Management: Lifecycle Management at Scale. Thank you, Bill Noel and Laura Fay. We'll see you next time.
If you have not already attended Technology and Services World, I would certainly encourage you to do so. This is the chance to engage with product leaders from the best technology companies in the world like we are right now to gain new insights and accelerate the success of your products and services. TSIA hosts TSW annually in both the spring and the fall. And you can go to TSIA.com/conference to register and learn more anytime.
Post Date: May 28, 2020
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Laura Fay is the vice president and managing director of offers research and advisory for TSIA. She also serves as TSIA’s vice president of XaaS product management research. Laura is a technology industry veteran with over 30 years' experience driving business growth in the enterprise technology industry via leadership roles in product management, general management, product development, and customer success.
The Technology Services Industry Association (TSIA) is dedicated to helping technology and services organizations large and small grow and advance in the technology industry. Find out how you can achieve success, too. Call us at (858) 674-5491 or we can call you.