Episode Notes 

It's not enough to just make a product more sustainable. At the end of the day, you also need to capitalize on that sustainability improvement because it’s an investment. 

In this episode, we answer how understanding the six stage gates to developing any product is essential to leverage sustainability improvements. We also discuss using single sustainability scores, trade-off and decision-making hierarchies in organizations, and why life cycle thinking is essential to not lose customers in today’s market. 

In this Episode 

Neil, as a product manager, how have you seen sustainability embedded into product development? 

• Neil - I have been a product manager for software. So, it's slightly different than when you're looking at physical products. But I think more of my experience has come from my work with product managers and engineers in the manufacturing space and that kind of formalized itself into a bit of a product management structure that I think would be good to explain to answer that question. [00:36 ] 


• If you look at the toolkit of the product manager there are six stage gates to developing any product. It starts with Discovery, where the goal is to find ideas. You could be looking at new technology on the market, demographics (who is buying what). There is a big green trend that has been going on for the last 20 years and is increasing. [1:01 ] 

• Product development is a messy process. There is no straight line. But I’m trying to create these buckets [stage gates] that describe this process, starting with Discovery, where you have an epiphany that could help your product or business. [1:30 ] 


• The second stage is desktop research [Scoping phase], which is done mostly on your computer. You are trying to build hypotheses (will it work, is it going to be better, is there a different market to address, is it a bigger market, is it viable?). There is not a lot of team activity at this stage. [1:48 ] 


• When you are looking at sustainability at this stage, you might do some crude life cycle assessments (LCA)s. [02:14 ] 


• Example - Consider a new kind of battery that is low weight, high power for an e-scooter or for a more sporty vehicle. Would you be able to create the battery for a vehicle with 1000 km range? You're trying to create hypotheses and ask are people going to buy it? Is this even technically viable? Have people done it before? [02:25 ] 


• There's a lot you can see about what is already available in the Scoping phase. It doesn't make sense to create a new battery if your main market segment right now is the Middle East or China. These things are not obvious. You may say it's a battery, it must be better, but that's not always the case. When you look at it from the entire lifecycle, the biggest impact from a battery comes from the use of it when you charge it, and the kind of grid you charge it from impacts the overall performance of that product. Using a lifecycle perspective at this stage allows you to understand and rule out some of these hypotheses that do not make sense. [02:50 ] 

• The next stage is Business Case. You are looking at it from both a technical perspective (will it work) and from a market perspective (if it were to work, will it make business sense). You might ask: Will it be twice as expensive? If it is a new market segment, will anybody buy it? How big is the market segment? If it’s a new geography, will you be able to address that geography? [03:27 ] 


• When creating the business case, it is pivotal that you look at the portfolio of products that you're responsible for, and not just an individual product. Because unless there is a big impact to the top or bottom line, you will not get much attention to take this project from the business case to the next stage, where you need to put resources into developing that idea. [03:51 ] 


• The fourth stage [Develop phase] is where you put resources into developing the idea, and the idea meets reality. When they start to build, many Product Managers realize the materials don't work, the processes that they have or the machines they have don't work, they can't find suppliers for certain materials and so on. [04:22 ] 


• What's important to consider here is not to stray too far away from those initial hypotheses [in Scope phase], because you have informed those things with lifecycle assessments and with looking at what has been done before. Very often we find product managers will look to solve a problem that they identify, but then forget about the consequences of making that change. [04:44 ] 


• The next stage is the Testing and Validation phase where you test the hypothetical benefits from taking that product to market and you would test this with market studies. Many companies also look at the stage gates for compliance and sustainability. Do they meet the criteria that would allow them to take the product to market? Both externally from a regulatory perspective but also internally from a company perspective. [05:15 ] 

• You're doing more robust analyses, slightly more detailed than in the early stages. This is where it becomes more realistic based on the suppliers that you would be using, and what are the real final materials that you would be using and so on. [06:00 ] 


• The last stage is the Launch phase and it's how you take the work that you've done and position the product in a way that it was envisaged. If this product is using 50% less water or has been created out of 30% more recycled content or is part of a producer responsibility program; these are things you need to quantify, verify, and they become part of the go-to-market. [06:24 ] 


• This is the frame in which product managers typically look at how they can embed sustainability into products. Sometimes it doesn't have to be a new sustainable product. Sometimes it's just a new innovation or an iteration of an existing product that makes it more sustainable. [07:02 ] 


• But it's not just about making that product more sustainable. At the end of the day, you need to capitalize on that sustainability improvement. You need to consider how to leverage that because at the end of the day it is an investment. Otherwise, you probably would not have put in that time. So, what is the additional benefit that you get? And I think that's how each of the stages give you the opportunity to be able to leverage that work. [07:23 ] 

Neil, you have mentioned in the past that the product manager may not be responsible for the sustainability aspect in each stage gate. What might be relevant to consider for walking a product through its stage gates and how that sustainability metric or responsibility gets passed to different product managers? [08:00 ] 

• Neil -The product manager's ultimate goal is to make trade offs, and trade offs happen at different product levels. Products are also typically seen in the context of which portfolio they fit into. Large organizations who are not just building a single product tend to be more complex, and so the products also belong to a bigger portfolio of products. This is where I would say you have different hierarchies of product managers that are making decisions at different levels. [08:37 ] 


• Should I use material A or material B is one such thing. Should I choose to make this kind of product that is part of my portfolio or cycle it out of that portfolio is a completely different question to answer. And that's above certain people's pay grades. I think the only way to do this is to set the right goals and have the right mechanisms of measuring improvement at any of these levels, and Jim has a lot of experience in this field. [09:10 ] 


• Large companies right now, especially in the automotive space, are transitioning more of their portfolio to electric and alternative fuels, and they're reducing their Scope 3 environmental emissions for the entire corporation. Not by changing existing products, just by adding new products to the portfolio and cycling out old products. This is one way to improve sustainability of an entire organization without changing an existing product at all. [09:39 ] 


• You also see companies fixing the products that are currently in the market because that makes the most business sense. These are different levels of decision making that typically are not in control of an individual product manager. [10:11 ] 

• The other aspect of this is some decisions are very operational. What kind of material you use will decide what kind of manufacturing process you can employ. If you're using machining or if you're using a casting, the amount of material you need compared to the amount of waste you produce for each product step is hugely different. Often product managers stay out of this because you have engineers to solve this problem and they give recommendations on what's the best way. [10:25 ] 


• The recommendation I have is to use the same metric across all decision-making processes, whet