443: Product wisdom from an innovation veteran – with Ken Gray

Why product managers need to understand customers’ needs

We have had a lot of valuable guests on this podcast, and one of my favorites is Ken Gray. When we talked a few years ago for episode 046, he was the Global Director of Innovation for Caterpillar. Since leaving CAT, he has worked on 3D printing, advanced manufacturing, robotics, and more. He has also been a long-time supporter of the University of Iowa Institute for Vision Research, which is creating cures and solutions everyone can afford for vision diseases.

Ken will be sharing lessons learned from years of product innovation wisdom. 

Summary of some concepts discussed for product managers

[6:43] How do we discover what customers want and need?

Innovation is people, culture, vision, and execution. Understanding what customers need is about having the right people on your team and building deep relationships with customers. You need people who spend a tremendous amount of time with customers to learn what they need. Customers generally don’t like to be on the bleeding edge of technology. They don’t want technology for technology’s sake or innovation for innovation’s sake. They have specific needs to improve their business. The most important product marketing work a company can do is understanding what customers need to improve their business performance and translating those needs into functional specifications, which define what a product needs to do to serve the customer’s needs. Functional requirements are the definition of what the product is, and technical requirements are the definition of how to engineer the product to deliver those functional requirements.

[9:10] What tools do you use to understand and meet customers’ needs?

Never write a product requirement document that isn’t prioritized. Never give engineering a flat list. Give them a prioritized list—at least high, medium, and nice-to-have. Otherwise you’re going to get the cool stuff first, which doesn’t necessarily align with what customers need.

There are things customers need that they don’t tell you they need. You need to understand why customers behave the way they do beyond their spoken word. Whatever appeals to them psychologically needs to be satisfied as well. Those buying decisions are harder to uncover than purely technical ones. To uncover them, you have to get to know your customers really well.

Maslow’s Hammer is the idea that if all you have is a hammer, every problem looks like a nail. This is unconscious bias. We tend to think if we have a technology that’s really cool or better than other technologies, people are going to come. It’s not that easy. You have to spend time understanding what drives success to the business and create an optimal product that helps your customers. You have to learn what customers need and explain your product to them. It isn’t about features and benefits. It’s about how your product improves your customer’s business—why they want it. If you can’t explain that to your customer on one sheet of paper, you’ve lost.

[15:10] What are some other lessons you’ve learned related to product innovation?

I would rather have an empty seat on my team than the wrong person in that seat. Don’t settle.

Nurture the dissenting voice. Have people on your team who will tell you when you’re wrong and ask hard questions.

[19:23] What tips do you have for working with team members?

We had town hall meetings with employees. I would sit on stage and have people fire questions. I always learned more about what was going on with my customers, my product, and my team culture in those settings than in any other place.

We always started these meetings with talking about safety. Everyone you work with—your team, customers, suppliers,