A Manifesto for a Better Way to Create B2B SaaS Products
A Manifesto for a Better Way to Create B2B SaaS Products
A Call to Challenge Conventional Practices and Unlock the Innovation Potential
Markus, the CPO of a promising B2B SaaS company, stared at the board presentation on his screen, his stomach churning. Their new flagship enterprise product was in trouble. After two years of development and millions in investment, it was struggling to gain traction.
It had all started so promisingly. The team had conducted discovery work and secured pilot customers. They had ideated and iterated the product with customers. They had even pivoted once, rebuilding almost from scratch. Confident they had cracked the code to help their enterprise customers in a massive market, they had pushed for a productized solution.
Yet, the last 6 months had been brutal. No new deals closed, two pilot customers pulled out, and others hesitated to commit.
Despite burning over half the company’s R&D resources, Markus was facing the dreaded Product-Market Fit problem. And it was not a sales problem. It was a genuine problem with the product itself.
“We followed all the best practices,” Markus thought. “Discovery, MVP, agile development, iteration, collaboration with customers. Where did we go wrong?”
As he prepared to present the disappointing results, Markus wondered: Was there a fundamental flaw in their approach to B2B SaaS development? Or was success in such a complex domain always going to be this elusive?
The All-Too-Common Struggle of B2B SaaS Development
Markus’s experience is far from unique. Across the B2B SaaS landscape, countless product leaders have faced similar challenges, trapped in a cycle of false starts, iteration, and expensive mistakes – all while following many industry best practices.
A massive opportunity in B2B and Enterprise SaaS hiding in plain sight
Since the late 1990s, I have been captivated by the immense potential of software to change the world for the better. While consumer software has improved significantly since then, B2B and enterprise software products have lagged far behind, plagued by high failure rates and unfulfilled promises.
This gap represents a staggering business opportunity. Imagine superior, scalable B2B products replacing thousands of cumbersome, expensive, custom-made systems across countless organisations in all industries worldwide. If only we knew how to create such products, consistently and economically.
Breaking free from conventional wisdom to forge a Better Way
To grab this opportunity and overcome the unique challenges of B2B and enterprise software, we need a Better Way that dramatically outperforms current practices.
This Better Way demands that we question established best practices and commonly held beliefs. Conventional ways have not been enough to fulfil the vast potential of B2B software.
A Better Way must simultaneously:
Maximise value creation for customers
Minimise complexity for both users and product developers
Consistently and systematically produce superior software products
My career-long passion is to find out the best way to create the best possible software products for complex domains. I was convinced that there must be objectively better processes that produce objectively better results.
And my obsessive need to understand fundamental causes of how things work has driven me to discover such a Better Way.
10 unconventional values, ideas, and characteristics of a Better Way
The Better Way I have found manifests the following unconventional values, ideas, and characteristics that challenge the status quo.
Depth of understanding customer needs is the primary measure of progress in creating successful software products for complex domains.
Customers know their needs, and their needs can be described explicitly, if we just know what customer needs are, in principle.
Customers are able to articulate their needs, even for some entirely new kind of technology we are developing.
Customer needs, properly understood, change only relatively slowly, in contrast to solutions.
Customer needs are therefore a solid and objective basis for a stable long-term product vision and strategy for large B2B and Enterprise SaaS products.
Common customer needs can be distinguished from customer-specific ones upfront to ensure we are creating a scalable B2B product rather than custom software.
It is possible to measure and compare alternative ideas for software products objectively.
Most ideas for a software product can be measured and compared objectively and quickly, without first developing the solution and without engaging customers and users in a testing and iteration process.
Since alternative solutions can be compared objectively, an optimal solution that maximises customer value and fulfils the customer needs exists, and it can be found out in practice.
Value creation potential of an optimal software solution can be estimated before designing or developing it, which minimises risk of failure and maximises return on investment in product development.
From iteration to a systematic approach to innovation
With this Better Way, we can define a superior software product without guesswork, opinions, feature requests from customers, creative ideation, brainstorming, divergent thinking, iteration, pivoting, failing fast, trial and error, or copying competitors.
While some of those approaches (like implementing customers’ feature requests and copying competitors) help in creating some solution, they won’t result in a radically better one.
Others (like ideation and iteration) can be useful in coming up with solutions to genuinely new kinds of problems.
However, I have noticed that much of the time customer needs for B2B and enterprise software across industries have many repetitive patterns. In essence, they are not genuinely or entirely new. Consequently, a solution that fulfils those needs can be found in a direct, fast, and consistent way.
A Better Way answers 3 critically important questions that determine success
This Better Way I have discovered empowers product leaders to approach their work with newfound confidence. It provides the means to identify exactly which problems to solve and how to solve them effectively. When presenting to the board, leaders won't have to showcase just incremental improvements, but industry-disrupting innovations.
This is achieved by the powerful answers that the Better Way provides to these three make-or-break questions:
What is the right problem to solve?
What are customer problems (or customer needs), in principle?
How can customer problems be discovered systematically, reliably and effectively, without wasting time and effort?
What customer problems are worth solving? How much value could be created by solving them?
What customer problems are common enough to develop a scalable software product?
What is the right solution to the problem?
What is an optimal solution to the overall customer problem, from a customer’s perspective, that creates the most value given existing software technology?
What is an optimal scope for the solution, given that solving some parts of the overall problem is more valuable than solving others?
What is the most direct way to find the optimal solution?
Can we make money solving the problem?
How can we know beforehand how much of the customer value that we create we could capture for ourselves as revenue?
How can we be confident, in advance, that our solution will beat the competitors’ solutions and win in the market?
What is the best path to the best solution that maximises the value for our business?
Mastering the answers can transform a product leader who constantly puts out fires to a visionary who drives the company’s future. The confidence comes from knowing that product decisions are based on solid facts rather than guesswork.
Deductive Innovation is a Better Way to create better B2B SaaS products
I have given a name to what I have discovered about this Better Way.
I call the result of my findings Deductive Innovation. Its purpose is to help find out an optimal software solution for large and complex intertwined customer problems as directly as possible.
The term “deductive” in Deductive Innovation means that new innovative B2B and enterprise software products can be systematically deduced from discoverable facts about customers, their problems and circumstances, and from an understanding of what software technology can do.
Using Deductive Innovation, defining and designing a product becomes primarily a process of inferring a unique and optimal solution from the customers’ viewpoint, rather than a gradual process of ideation, iteration, or copying other products. The role of iteration is delegated to fine-tuning details.
Based on my experience, Deductive Innovation helps find entirely new value for customers that they never would have asked or imagined. It often results in revolutionary rather than evolutionary solutions that improve customers’ productivity by a factor of 5x to 10x, or more, and that deliver significantly better business outcomes.
For product leaders, this means an end to uncertainty about product traction. No more defending roadmap decisions based on gut feelings. The confidence to lead will be backed by a systematic approach that can consistently deliver results.
Why a Better Way can’t be about the best technology
Deductive Innovation is not a new software technology or a new software engineering process, nor does it directly help in inventing entirely new software technologies.
Instead, Deductive Innovation addresses customer-facing and business risks of B2B product development, which are almost always more critical than feasibility risks. Technologically the best state-of-the-art software will result in business failure if it does not fulfil customer needs and create enough value for them.
While technology changes quickly, properly understood customer needs stay largely the same, whether the new technology is the Internet, cloud computing, the smart phone, analytics, big data, microarchitecture, AR/VR, block chain, IoT, metaverse, or today, generative AI and LLMs.
Consequently, discovering, analysing and understanding customer problems in a way that consistently helps generate superior solutions is the core of Deductive Innovation.
Calling for B2B and Enterprise SaaS visionaries to update the rule book
If you identify as a brave B2B SaaS product leader who desires to disrupt your industry, who wants to create radically better B2B software products for your customers, and who is ready to question established rules and consider unconventional ideas, my newsletter is for you. Subscribe now and learn how to outpace competition using a new Better Way!
Here is what you can expect I will write about:
Innovating better B2B and Enterprise SaaS products:
Cutting-edge product strategy
Effective technique for customer problem discovery
Rigorous approach to opportunity selection
Systematic product design method for scalable products
Exclusive insights into Deductive Innovation:
What it is and how it works
Practical experiences and lessons learned from its real-world application
Case studies and examples
Analysis of today’s best practices (e.g. product operating model, agile, lean startup, design thinking):
What common product development practices get right and why
Where and why conventional approaches fall short with B2B products
What makes Deductive Innovation different
How Deductive Innovation fits in with best practices
A new explanatory theory behind Deductive Innovation:
Understand the reasons why Deductive Innovation works
Recognise its limits and potential weaknesses
Gain a deeper grasp of the underlying principles of customer value creation and product design
Subscribe now for an opportunity to gain a decisive edge in the competitive B2B SaaS landscape.
Leap ahead of your competition and join the movement!
My mission is to revolutionise the B2B software industry with this Better Way.
I want to liberate every B2B product leader like “Markus” from the cycle of uncertainty, frustration and disappointment. I want them to experience the confidence of knowing their solutions will solve the right problems for the right customers in the right way. I want them to feel the satisfaction of delivering products that customers rave about.
That is the reality I want to create for as many B2B product leaders as possible.
Are you ready to break free from the cycle of uncertainty and disappointment?
If yes, I invite you to join me in this journey.
1) Subscribe the newsletter now. You will get:
Exclusive, early access to groundbreaking insights that your competitors don’t have yet
A FREE copy of “The Secrets of Gaining an Unfair Advantage for B2B SaaS Products” – a report revealing the best strategies and insights from 31 B2B SaaS founders and product executives I interviewed
2) Engage with the community:
Comment on the articles (publicly or privately)
Ask tough questions
Share your own experiences
Challenge assumptions and spark debates
3) Spread the word:
Share anything you find valuable with your network
Inspire fellow product leaders to embrace innovative thinking
Want to go deeper? I am always open to closer collaboration in applying, developing, or spreading Deductive Innovation. Reach out through the contact information on the About page.
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