Motivation

Effectively setting goals at the organizational level has always been difficult. We face a wide variety of opinions, individual and group priorities, internal and external demands. Managing all these needs is a delicate art. In this article, I will present a model inspired by Maslow's Hierarchy of Needs, as I believe it can help us structure the process. Human needs are different from organizational needs, but they share important characteristics in the way they relate to each other.

Hierarchy of Needs

Maslow's Hierarchy of Needs is a psychological theory proposed by Abraham Maslow in his 1943 paper "A Theory of Human Motivation". Depending on the revision, it outlines five to eight tiers of human needs, often depicted as levels within a pyramid. From bottom to top, all revisions begin with four basic needs:

• Physiological needs (such as food, water, warmth, and rest)
• Safety needs (such as security and safety)
• Belonging and love needs (such as intimate relationships and friendships)
• Esteem needs (such as prestige and feelings of accomplishment)

and continue with growth needs, which were originally a single level and eventually split into four:

• Cognitive needs (such as creativity and meaning)
• Aesthetic needs (such as aesthetically pleasing experiences)
• Self-actualization (such as achieving one's full potential)
• Transcendence (such as spirituality)

The hierarchy suggests that people seek to satisfy basic needs (the four basic levels of the pyramid) before moving on to meet higher-level growth needs, with the ultimate goal of self-actualization and transcendence. Ignoring our desires at a more profound (or: lower) level of the hierarchy ultimately prevents us from achieving our higher level goals. Since goals, opportunities, our environment and motivations change, we continuously adjust our actions accordingly.

With this in mind, I have been iterating over a model for our continuous development process. Therefore, I would like to share the "Hierarchy of Needs for SaaS Products".

Model

The process of designing and building successful products should be viewed as an exercise in collaboration and mutual growth. This model is read from the bottom up, with the foundation representing the most basic and essential needs.

The model is divided into seven levels, with the first four representing deficiency needs. These needs arise from deprivation and are essential requirements that we must satisfy in order to avoid unpleasant feelings.

Above these are three levels representing growth needs. As their classification suggests, these are not basic necessities but rather stem from our motivation to continuously improve and grow as an organization. They encompass our goal of realizing our full potential as an organization.

Each level of the model is associated with distinct risks, rewards and actions. On the left side of the pyramid, we list potential risks from unfulfilled needs at each level. Conversely, on the right, we see typical responsive actions, practices, and positive effects that may result from fulfilling needs at each level.

Note that the model does not outline a journey. In a company's journey, the focus will shift between the levels. However, at no point we can completely ignore the needs of one or more levels (especially on the first four levels).

Building products is a collaborative effort, supported by the personal and interpersonal needs of all involved parties. To keep the model focused, it is designed with the assumption that a healthy working culture is already in place, addressing the personal and interpersonal needs of all team members.

Levels

1 Basic availability

Level 1 describes the need to maintain the reputation of the company and the product, and a general ability to keep our product capabilities available. Availability may be far from an exciting user experience, but metrics such as uptime play an important role. Failure to address these risks can, of course, lead to downtime of any length, risk of loss of intellectual property, or breaches of customer data. Or the business may fail altogether. Such highly reactive work can only be mitigated by immediate crisis management. It creates high opportunity costs and individual stress. Any action at this level usually means "all hands on deck" until the situation is under control. This is the lowest level of maturity.

2 Secure and proactive operations

Level 2 represents the need to overcome reactive behavior and act in a much more proactive and organized manner. While the main consequence of not addressing these needs is still significant churn, bad customer reviews, or high opportunity costs, we have moved beyond the need for pure "firefighting" and are striving to establish a predictable process for developing engaging products. This includes a variety of non-functional aspects depending on the size of the organization:

• Are we in regular contact with our customers and aware what problems they are trying to solve?
• Do we maintain a concise and actionable backlog of work to improve our product?
• Is our software development lifecycle sufficient, so we ship new features with speed and confidence?
• Are we ahead of potential security threads?
• Do we have a strategy for technology lifecycles?
• Does our infrastructure scale according to our customer base?
• Do we have our operational costs in check?
• Are we resilient and prepared for growth of our customer base?

The maturity of these processes is the dividing line between teams that operate in a resilient and proactive manner, building quality products, and teams that try to react to (or at least survive) the next problem that comes along.

3 Outcome-oriented product development

Level 3 shifts the focus to the results of our efforts to build a product that is compelling and desirable to our customers over the long term. Having operational, organizational, and product development processes under control doesn't automatically mean we're always building the right things. Continuous communication builds a common understanding among engineers, product managers, and management to move in the same direction. Roadmaps, goals, and key deliverables define and communicate these outcomes throughout the organization. Without this, teams may end up working in different directions or optimizing for high output without increasing customer value. Instead, they increase product complexity without helping customers solve problems more easily. In addition, as a compounding effect of such deficiencies, organizations may end up unable to explain what problems their product actually solves, which can lead to a lack of new business or competitors filling the gap. A critical artifact is the product vision, shaped and guarded by the organization's leaders, continuously communicated and evangelized, and carefully adjusted as needed.

4 Consistency of vision and values

Level 4 is about value, resilience, and consistency. Organizations may have a strong understanding of the right things to build for their customers, but the product may become less resilient to change or, on the contrary, lose its overall coherence. This is not exclusive to established products with long-standing customer bases, but it is more typical. Recurring symptoms include increasing amounts of technical or product debt. For example:

• A large number of technologies in use on a technical level which isolates teams through their varying expertise per technology
• Complex codebases with increasing maintenance cost
• Inconsistent user experience across product parts, such as varying UI behaviors or disruptive user journeys due to unsupported features
• Barely used features that remain to be maintained and explained
• Extending functionality while maintaining backward compatibility, such as extending APIs
• Increased manual effort throughout the development lifecycle
• Declining customer sentiment and or Net Promoter Scores

In a market-leading situation, this may be more acceptable, but the risk remains that a competitor will emerge that is able to execute much faster and more resiliently, undermining the organization's continued growth. To overcome this shortcoming, it is essential to align external customer-centric roadmaps with internal roadmaps, execute against them with sufficient levels of investment, and maintain a consistent product vision. Organizations must ensure that they retain what has made them successful.

5 Discovery of opportunities

Level 5 takes us to the need for growth. At this level, the organization is able to operate at a fast pace, is resilient to change, is proactive, and is able to secure and increase value for its customers. But of course it doesn't stop there. Pressure from competitors, the rise of new disruptive technologies, emerging markets, and other variables keep organizations on their toes and they need to find a way to stay ahead of the curve. To unlock more growth, teams focus on further market and product discovery. They are trying to understand what the next big thing is, what is preventing them from entering new markets to diversify their offerings, and how their product needs to evolve in the coming years. Furthermore, this should not be limited to a small group of executives, but organizations must find ways to scale a culture of growth and excellence throughout all levels of their hierarchy. Ideally, the right environment is created so that teams feel empowered and intrinsically motivated to build excellent products with a long-term strategy they understand and support.

6 Ability to innovate

Level 6 suggests that organizations not only understand how to cultivate the right environment for innovation, but they are effective and have the right level of urgency in doing so. It goes beyond the "Why" and "What", but also covers the "How". In large organizations with a demanding business customer base, there are many challenges to continuous transformation. Classic examples include the "Innovator's dilemma" and self-inflicted obstacles such as excessive bureaucracy and technical complexity. In addition, an organization's growth can stall if it is not perceived as relevant enough in the hiring market to attract the necessary talent. However, when organizations address these needs at this level, they achieve a level of excellence such that their products are considered industry standards or even drivers of standardization across organizations. Such products can also achieve high adoption rates through an exceptional user experience, providing a compelling competitive advantage. Ultimately, these organizations are able to replicate their success with new products or by maintaining their competitive edge as new disruptions emerge, such as the rise of AI.

7 Cross-industry leadership

Level 7 takes us to organizations that excel beyond their industry and are recognized as pioneers or visionaries of their respective products. We think of companies famed for their products, regardless of whether we use their products. These companies have reached a critical level of support for their mission, may have an impact (ideally positive) on society, or may be evangelists of a particular work methodology. As you can imagine, such significant impact comes with great responsibility, and the biggest risk at this level is failing to live up to expectations.

Application

How does this model help us define strategy or take the right actions? The "Hierarchy of Needs" can be used to assess the strategic and operational excellence of a team, a function of an organization, or the organization as a whole along the pyramid from bottom to top. For each level, we can examine:

• Is this level of the pyramid relevant for our organization at its current size?
• What are the outstanding risks at this level within our organization?
• Which of those are the biggest threat to our success?
• What critical needs are currently unmet?
• How are we currently mitigating these risks?
• Are we confident that we're able to fulfill the needs on this level?
• What is our risk tolerance for each level?

As a practical approach, consider running a survey within your leadership (or even entire) team and build it around the questions above, depending on what you're most curious about. Here are some potential questions you could ask:

• On a scale from 1 (irrelevant) to 5 (mission critical) and for each level, how do assess the relevance of this level for your / your organization's work as of today?
• On a scale from 1 (fully under control) to 5 (fully uncontrolled) and for each level, how do you assess our organization's ability to manage needs and risks?
• For each level, do you disagree / partly disagree / partly agree / fully agree that we as organization take the right actions to address risks?

Once that's done, we can go a step further and assess whether we're balancing our efforts correctly. We can assess at which levels we have the highest level of unmet need or unaddressed risk. This exercise is likely to be even more insightful if done with different stakeholders or functions within the organization to get a more balanced perspective.

Consider using your survey to explore misalignments within your teams. For example, some might view a lack of new business (Level 3) as a bigger revenue risk than customer churn (Level 2), while others might disagree. A survey can highlight a potential disconnect.

Another common challenge is overemphasizing growth needs (innovation and new features, Level 3+) while not properly addressing deficiency needs (technical debt, operational excellence, Level 1-2). Or we may be on the verge of a regulatory change that impacts the functionality of our core product (Level 3) while we're focused on launching another product (Level 5+).

Or an organization may be torn between a strong focus on managing operational risks and investing in modernizing its technical platform (Level 1-2) and trying to launch a new product (Level 5-6) while the core product roadmap remains vague or unaddressed (Level 3-4).

In general, however, we assume that needs at a lower level of the pyramid must be sufficiently (not perfectly!) addressed before moving on to higher-level needs. If we don't address a critical operational risk involving our customers' data, it doesn't matter if we're at the forefront of a technological revolution. Conversely, in a Western economy, growth is essential for longevity and success. Therefore, growth needs cannot be ignored indefinitely. If we manage risks and needs properly, we should look forward and beyond.

Summary

We strive to address all the risks and needs our organization faces. But in reality, our strategy is driven not only by our mission and goals, but also by very strict constraints and dependencies. We are forced to apply rigorous prioritization and focus on the most impactful actions at the right time. The "Hierarchy of Needs for SaaS Products" is a model to help you organizing this prioritization process, ranging from basic operational aspects to higher-level growth concerns, along a hierarchical structure of risks and needs. It can be used to continually assess and refine your organization's priorities. Assessing the maturity of our actions and the severity of existing risks along the pyramid depends on a multitude of factors, such as your organization's stage, your industry, or the market situation. Lacking a one-size-fits-all approach, I encourage you to rally your organization's leadership team to define the right questions along the pyramid, and to dissect and assess the outcomes.

And of course, I would be glad to hear your feedback and whether or not the model helped you in any way going forward.

Published by Basti Tee

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