Product–Market Alignment

Abstract

The ability to achieve product–market alignment (PMA) differentiates businesses that will thrive from those that will fail. Yet many find it difficult to create—and sustain—products that continuously generate value, even as their markets change. Traditionally, managers seeking to develop new products or reexamine current offerings have relied on frameworks that compare customer views on the desirability of various product features to the financial potential of those features. This note expands this common approach to explicitly include the consideration of operational resources and capabilities. This includes the resources needed to develop the product or service and to deliver it. An organization's operational capabilities can dictate whether, how, and which potential new products can be built, so it is important to understand the interplay among marketing, finance, and operations when developing new products or refreshing existing ones. The framework in this note is useful both when developing new products and reexamining existing offerings.This note can stand alone, but works well when used with a case, "Product Development at StubHub: Don't Stop Believin'" (UVA-OM-1705), that explores a company's efforts to innovate and create new value for its customers.

Excerpt

UVA-OM-1706

Apr. 19, 2022

Product–Market Alignment

Firms that get to market faster and more efficiently with products that are well-matched to the needs and expectations of target customers create significant competitive leverage. Firms that are slow to market with products that match neither customer expectations nor the products of their rivals are destined to see their market position erode and financial performance falter.

—Steven C. Wheelwright and Kim B. Clark

Product—Market Alignment

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Keywords: lean, Agile, innovation, scale, growth, new product development, product–market fit, product–market alignment, software development, product management, process management, project management, operations management