A summary of an article by Brandon Chu which provides key insights on where Product Managers should be focused on and what are the benefits of each (examples added for illustration):
- Expected value - Estimate potential value by multiplying probability * payoff (e.g. 60% chance of $100k increase means $60k expected value)
- Jobs to be done - Understand the core functional and emotional jobs customers need to get done (e.g. making holes not buying drills)
- Cost-benefit analysis - Compare costs and benefits of different product options (e.g. cost of building feature A vs additional revenue expected)
- Systems thinking - Consider how parts interact within a whole system (e.g. how pricing impacts demand and company revenue)
- Cognitive biases - Recognize biases like overconfidence that could influence decisions (e.g. assuming a feature will be more successful than it likely will be)
- Probabilistic thinking - Use probability to estimate likelihood of different outcomes (e.g. 30% shot this launch date will be met)
- Game theory - Model strategic interactions between competitors (e.g. if we cut price, how will competitor respond?)
- Analogical reasoning - Leverage patterns from different contexts to inform decisions (e.g. freemium model successful in app world, will it work for our product?)
In summary, the article advocates that product managers adopt these various mental models to simplify complexity, identify core issues, and ultimately make smarter product decisions that create value for customers.