Aligning Corporate Strategy and Product Strategy

In Q3, Dialogue’s annual strategic planning process kicks off every year. One of the discussions which has percolated across the organization for the past few years involves the interplay between corporate strategy and product strategy. Some leaders cite examples of pure play product companies in which the product strategy is the corporate strategy and the product roadmap dictates the strategic choices made by the organization. This approach falls short since it fails to account for corporate strategy decisions which help to inform the product strategy. This article outlines the difference between corporate and product strategy and a dozen best practices for aligning both.

The best way to describe Dialogue is as a tech-enabled multi-disciplinary clinic in the cloud. In essence, we are both a healthcare SaaS and tech-enabled healthcare services business. Regardless of where healthcare technology companies choose to play on the spectrum of service and software provision, corporate strategy is fundamental for outlining a company’s overall objectives and how it aims to create value for stakeholders. While business and product strategy are interconnected, they serve different purposes and require different approaches. Understanding the distinction and the relationship between these two types of strategies is crucial for healthcare technology businesses to thrive and achieve their goals.

Corporate strategy vs. product strategy: The basics

A corporate strategy is a long-term plan that a company implements to achieve its overall objectives and create value for its stakeholders. It outlines the direction of the company, its scope and how it will achieve and sustain a competitive advantage.

In contrast, a product strategy is the roadmap of a product that outlines the end-to-end vision of the product and what it will become. Companies utilize a product strategy to reach product-specific goals, which align with the overall corporate strategy.

The role of corporate strategy

The corporate strategy provides a clear vision and direction for the entire organization. It outlines the company's value proposition, key business objectives, and the methods for achieving those objectives. It's a high-level plan that guides the company's overall operations and decision-making. It's not about specific products, features, or markets, but rather about the overall operational and competitive approach the company will take to achieve its goals.

The role of product strategy

Product strategy, on the other hand, is more focused. It's about how a specific product, or suite of products, will achieve their objectives within the framework of the overall corporate strategy. It outlines the product's target audience, the value it will provide, its unique selling proposition and how it will overcome competition. The product strategy provides a roadmap for product development, marketing, sales and customer support.

The interplay between corporate strategy and product strategy

While corporate strategy and product strategy are distinct, they are also interconnected. The corporate strategy provides the foundation for the product strategy. It sets the overall direction and goals that the product strategy should support. The product strategy, in turn, provides the roadmap for achieving those goals.

The corporate strategy informs the product strategy and provides the necessary context for making strategic product decisions. For instance, it helps determine the market the product should serve and the business goals it should meet. It's a key input for any product discovery work.

Aligning Corporate Strategy and Product Strategy

Aligning corporate strategy and product strategy is crucial for achieving business success. Misalignment between the two can lead to wasted resources, ineffective products, and missed opportunities. To ensure alignment, the corporate strategy should be clear and well-communicated throughout the organization. It should be so clear that anyone, especially product managers, can consistently explain it, independent of any product or feature.

Product managers should be involved in the creation and review of the corporate strategy. They often hold key insights into markets, competition, and trends, making them well-equipped to contribute to corporate strategy discussions. At the same time, the leadership team should understand how the product portfolio supports the corporate strategy and which business goals the individual products support.

10 tips for aligning corporate strategy and product strategy

Develop the corporate strategy first: Devise the corporate strategy before the product strategy, leveraging a cross-functional Steering Committee and SWAT teams with strategy and product leadership. The corporate strategy should lead the product strategy and not vice versa.
Align on key product areas that drive commercial success: The business strategy should inform the product strategy about key segments you want to support and key points of friction that you want to improve. If a significant portion of your business comes from a segment, organize your strategy and product team(s) to focus on it.
Articulate your product design principles: The product team should translate the organization’s vision and strategy into a set of specific product design principles and then leverage them throughout the design / execution phases.
Test a set of product / market fit hypotheses: This includes target audience, the problem you're solving, value propositions, strategic differentiation, competition, acquisition strategy, monetization strategy, and key performance indicators (KPIs). At Dialogue, we leverage desirability, viability and feasibility tests to assess these hypotheses.
Focus on actionable, customer-centric problem solving: Every year at Dialogue, we host a Think Tank event with an advisory board of HR leaders from 30+ organizations. Through design thinking and workshops, we solicit input for our strategic plan and product roadmap. Rather than simply listing problems or solutions at face value, we spend a day focused on actionable, customer-centric problem solving.
Identify your audience and invest in UX and UI research and R&D: Do the research before moving forward with crafting your product strategy to ensure that there’s an actual audience for your product.
Write your corporate strategy and product strategies down: These strategies need to be visible to every employee tasked with building, selling and supporting your products. This helps keep your product and company vision at the heart of every decision your team makes for your product.
Align the entire organization around the corporate and product strategies: Build and deliver products or features with confidence by having a clear sense of your product’s “why.” The products or features should align with the organization’s overarching mission. Ensure clarity on vision and strategy, putting the whole organization on the same page when it comes to a product-led culture. Every team should know what the roadmap looks like and how their specific work will contribute to not only the roadmap but also larger organizational goals. Everything should align with the corporate strategy and business objectives.
Align work to strategic objectives using holistic business systems (e.g. EOS, OKRs): Your strategic roadmap should consist of a set of clear rocks, goals, objectives or key results. These are informed by your target customer segments and prioritized according to customer impact. Track each team’s progress towards achieving business outcomes and identify at-risk initiatives to get them back on track.
Refer back to the corporate and product strategies and don’t sweat over perfection: When faced with uncertainty, or disagreement, teams should refer back to the corporate and product strategies to determine which paths speak to the intent of the product. It’s important to have a clear view of what you want the organization to achieve. Be crisp and brutal with opportunity prioritization and how you’re trying to achieve the vision. At Dialogue, we leverage a single list of opportunities from across the organization which are dynamically ranked and incorporate strategic priorities and product priorities.

Both corporate strategy and product strategy are essential for a company's success. While they serve different purposes, they are closely interconnected and should be aligned to ensure that the company's overall objectives are met. By understanding the distinction and the relationship between these two types of strategies, businesses can make more informed decisions, develop more effective products and ultimately achieve their goals.

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Aligning Corporate Strategy and Product Strategy

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