🎙️ Pod Shots - Bitesized Podcast Summaries

Today, we’re covering a recent Product Thinking Podcast, with Shruti Patel, Executive Vice President and CPO Business Banking at U.S. Bank. Shruti shares her expertise in navigating the complexities of product development within large financial institutions. She covers her approach to product leadership and the differences between product management in traditional banking sectors and more dynamic startups. Overall, Shruti emphasises the importance of continuous improvement in existing products and customer experiences, while also keeping an eye on emerging trends and technologies.

Having worked in both Fintech and traditional banks I tend to find more alignment with the disruptor’s side of the conversation so don’t necessarily agree with all her view points. But overall a great conversation with plenty to learn from.

⚒️ Balancing Legacy and Innovation with Shruti Patel

🎥Watch the full episode here

📆 Published: October 2nd, 2024

🕒 Estimated Reading Time: 3 mins. Time saved: 40 mins🔥

Mastering Product Focus: Balancing Legacy and Innovation

🚀 The Challenge of Balancing Legacy Systems and Innovation

One of the most critical issues product managers and founders face today is balancing the pressure to innovate while managing legacy systems. Patel touches on how fintech companies like Shopify focus heavily on solving specific pain points, whereas large banks like U.S. Bank must deal with broader complexities. This broader canvas often requires a slower transformation, as the dependencies between legacy infrastructure and newer technologies present a unique challenge.

Takeaway for Founders and Product Managers:

• Understand the limits of your infrastructure. If you’re managing a legacy product, don’t underestimate the complexities involved in transforming it. Instead, map out what dependencies exist, how new tech can layer into the old, and plan for incremental upgrades.

• Focus on targeted pain points. Even in a legacy system, look for the most critical customer pain points you can solve immediately. Prioritise those quick wins to show progress, even as you plan for larger transformations.

💡 From Fintech to Traditional Banks: What’s the Difference?

The difference between working in a fintech or a company like Shopify and a traditional bank is stark. In fintech, products are built with modern infrastructure, making it easier to create and iterate quickly. However, banks are dealing with decades-old technology that doesn't always adapt as fast to modern API-based or microservices-based designs. Shruti explains that large banks not only manage digital interfaces but also have physical channels like ATMs, branches, and in-person advisory services.

Takeaway for Founders and Product Managers:

• Integrate omnichannel thinking early. While fintechs can focus exclusively on digital, if your product spans digital and physical touchpoints, think about how those different channels can work together.

• Legacy doesn’t mean old-fashioned. Leverage the inherent strengths of legacy systems (trust, scale, reliability) while planning your product updates. Remember that some parts of your system may still work well, and there’s no need to throw everything out.

⏳ Speed and Agility: It’s Not Always a Race

For product managers, speed to market is always a hot topic. Fintech companies often seem faster, but Shruti makes a critical point about the trade-offs U.S. Bank must navigate due to the sheer scale of their customer base. When launching a new product, even a minor mistake can affect millions of people. Therefore, banks must rely on rigorous testing and gradual rollouts.

U.S. Bank uses A/B testing and focus groups before launching new features to its large audience. This controlled approach might seem slow to SaaS companies, but when managing people's money, it’s the only safe way to ensure a quality product.

Takeaway for Founders and Product Managers:

• Speed isn’t everything. While moving fast is important, it’s more crucial to ensure the quality of your product, especially if you’re in a regulated industry like banking.

• Adopt a ‘test before release’ mindset. Whether you’re releasing a new feature to 100 customers or a million, testing and feedback loops ensure you’re not pushing something harmful to market.

🔄 Horizon Planning: The Three-Part Framework

Shruti highlights her Horizon 1, 2, and 3 model of product management, which helps large organisations balance existing products while exploring new opportunities. She spends 70% of her time on Horizon 1, focusing on enhancing existing capabilities and driving immediate impact. Horizon 2 takes 20% of her time, expanding current products into new segments, while Horizon 3, the more experimental and forward-looking stage, gets the final 10%.

Takeaway for Founders and Product Managers:

• Use the Horizon Model for clarity. Focus the majority of your efforts on existing products and customer needs, while leaving room for innovation and future-focused experiments. This ensures you continue growing your current business while preparing for the future.

• Set realistic expectations. Only 10% of your time should be spent on the "next big thing." The rest should be invested in improving what already works.

📊 Leveraging Data for Customer-Centric Products

Shruti places immense value on customer feedback and user research, explaining that U.S. Bank’s annual survey of small businesses directly shapes their product development decisions. Cash flow and access to capital were identified as two key pain points for small businesses, leading to the development of U.S. Bank's new cash flow management tool.

For U.S. Bank, insights from surveys and direct customer engagement don’t just guide product features—they shape the entire product roadmap. This continuous feedback loop is what ensures their products are meeting real customer needs.

Takeaway for Founders and Product Managers:

• Listen to your customers. Structured feedback—through surveys, focus groups, or regular user interviews—should be a vital part of your product development process.

• Prioritise data-driven decisions. When deciding on new product features, use customer data to back up your choices, ensuring you’re solving real problems rather than chasing trends.

⚙️ Engineering Collaboration: Bridge the Gap Between Product and Tech

A common challenge Shruti discussed was getting engineering teams to think more like product managers. In large enterprises, engineering teams can feel disconnected from the customer, focusing solely on delivering what’s been specified by the product team. To address this, Shruti encourages bringing engineering teams into the product discussions earlier, helping them understand the "why" behind each feature.

This not only leads to a better alignment between product and engineering but also encourages faster problem-solving since the technical limitations are discussed upfront.

Takeaway for Founders and Product Managers:

• Involve engineering early. Bringing engineers into the product development process as early as possible fosters collaboration and reduces the risk of misaligned priorities.

• Encourage context sharing. Help engineers understand why specific customer pain points matter and how their work is directly contributing to the solution. This builds a shared sense of ownership.

🏗️ Product Transformation: Shifting From Projects to Products

Shruti shared her experience in leading U.S. Bank’s shift from a project-based to a product-based organisation. Traditionally, financial institutions operated with a project mindset—delivering one-off solutions to fix specific problems. However, moving toward a product-based approach means thinking holistically about the customer’s journey, mapping it out, and organising the company around delivering value through long-term product thinking.

Takeaway for Founders and Product Managers:

• Move from projects to products. Shifting to a product mindset means your organisation should stop focusing on short-term fixes and instead think about how to build long-term value for the customer.

• Map the customer journey. Start by understanding how customers interact with your product at every touchpoint, and ensure your teams are organised to support these journeys holistically.

📉 Velocity and Quality: Finding the Right Balance

Velocity in Agile product management often gets a bad reputation for being solely about pushing more features faster. Shruti suggests a better approach: using velocity as a measure of how efficiently the team is moving through the backlog, but always keeping an eye on the quality and impact of those stories. A high-velocity team that’s delivering low-quality work isn’t providing real value.

Takeaway for Founders and Product Managers:

• Focus on both speed and quality. Measure velocity, but don’t sacrifice quality for speed. High-velocity teams should also be delivering high-quality, impactful work.

• Ensure every story contributes to the larger goal. It’s easy to get lost in the details, so always check that individual stories tie back to broader initiatives.

🌱 The Future of Fintech: AI and Integrated Experiences

Finally, Shruti is keeping a close eye on artificial intelligence and the growing demand for integrated experiences in fintech. Small businesses are increasingly looking for bundled software that can manage everything from cash flow to payroll. The desire for simplicity, combined with the power of AI, presents exciting opportunities for the future.

Takeaway for Founders and Product Managers:

• Embrace AI wisely. AI can drive efficiency, but make sure it’s solving the right problems for your customers.

• Offer integrated experiences. If your customers are juggling too many tools, consider bundling your offerings to provide a simpler, all-in-one solution.

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or if you prefer, 🎥Watch the full episode here

📅Timestamps:

• 00:00 - Intro

• 03:29 - Product Management in Financial Services

• 08:16 - Importance of User-Centric Design

• 12:06 - Balancing Innovation with Legacy Systems

• 16:43 -Staying Focused on High-Impact Products

• 19:52 - The Horizon 1-2-3 Model for Product Development

• 23:51 - Justifying Investments in Infrastructure Modernisation

• 27:46 - Metrics for Measuring Product Success

• 31:11 -Transitioning to a Product-Centric Organisation

• 37:00 - Engaging Engineering Teams in Product Strategy

• 41:11 - The Role of Velocity in Agile Product Development

• 43:01 - Future Trends in Fintech and Small Business Solutions

• 45:14 - Outro