The other day I was doing an interview with a member of the press having to do with the future of Silicon Valley, and I was asked the question: “Do you think there are any good opportunities left?” It took me a minute to realize that he meant this as a serious question. The whole concept seems so foreign to me especially since I personally see more opportunity now than I have ever seen before.

But the question caused me to think about why I believe this so strongly. For anyone that has any doubts at all, I’d say three things. First, as long as there are products that drive you nuts, there are opportunities for someone to do it better. How about a cell phone that doesn’t drop calls? How about a home computer that your parents can actually administer without your help?

Second, what is possible is always changing. Just because something isn’t feasible today doesn’t mean it won’t be tomorrow.

And third, today’s applications are tomorrow’s foundation. That’s how things work in our business. Initially the browser was an application to look at some content on a web site. Today the Internet is a foundation enabling applications like eBay, TheFacebook, Skype, and PayPal.

Speaking of Skype, I think there’s something very important going on now and that every product manager should review their product plans in light of what’s coming. For the past 10 years I have been hearing pretty much non-stop hype about wireless. But there’s been so much hype with so little value that in large part I think the press and the general public have lost enthusiasm. Data speeds are so slow that web browsing from your cell phone is beyond unusable. WAP interfaces are pathetic, and with the notable exception of GoodLink, wireless applications have just not happened. Most people are still struggling to find a cellular service provider they don’t hate.

Ironically, I think that finally there is something happening in the wireless world to get truly excited about, but it’s hardly received any attention. I’m referring to wide-area wireless broadband, along the lines of what Verizon is now rolling out in major metropolitan areas across the US.

Today, Internet devices are essentially tethered on a short leash. Either they are literally wired to the network, or they connect through “hot spots” that let you wander a few feet. But whether it’s a laptop or a phone or your iPod, to be useful going forward you’ll need to be able to roam freely and stay connected and useful speeds.

As the network deploys and the costs come down, which is already happening, I think this will enable a new generation of applications and services. Don’t you want your car’s navigation system to overlay traffic data onto the map as you’re planning your route? Or take true access to your office with you as you travel? Or receive your podcasts – audio and video - over the air? I think the list is endless and of course the best applications and services will be the ones currently just beyond our imagination.

Which brings me back to Skype. With over 50 million users worldwide, Skype is the leading service for making phone calls over the internet (Voice over IP). They’ve done a truly great job on their service, and in my view they have clearly differentiated themselves from a very crowded market, much like Google differentiated themselves from a crowded search market. Today, Skype users make calls from their PC with a broadband connection. But imagine Skype running on your Treo 750 (I’m making that model up – but it’s the one that will run on this new wide-area wireless broadband network). Ironically, Skype on a broadband connected Treo makes the voice network unnecessary. Not sure if Verizon realized that or not when they deployed their new network, but I’m betting someone at eBay sure did.

I think every product manager should get their laptop connected to this network, and get a phone with data access to this network, and start looking at what you can do for your customers with this new foundation today that you couldn’t do yesterday. Remember that great product managers combine what is desired with what is just now possible, and what’s “just now possible” has just changed in a very significant way.
So no way that the good opportunities are all gone. In fact, I’ve never had as many products I’d like to be working on as I see now.

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Just about every company I talk to now is outsourcing to one degree or another. Yet the results are decidedly mixed. I think there are several reasons for the problems that companies are having. Often the problems stem from issues with the product development process, or from language or cultural issues, but more often than not I think the core issue stems from using outsourcing for the wrong reasons.

For most professional positions, outsourcing should not be about cost savings. It should be about assembling the right people for the product. Very often now, you have to look beyond your vicinity for the right people. This might mean hiring someone that’s based in another state, or it may mean someone in another country.

The sad truth about Silicon Valley is that it has become so expensive to live here that many of the people that you would like to hire can’t afford to live here at the salary that you can afford to pay them. Commuting only works to a degree. Eventually the talent supply runs out and you have to look elsewhere for the right team.

Fortunately, there are some terrific sources of outstanding product talent in places such as India, Eastern Europe (especially the Czech Republic, Hungary, Poland and Slovakia), Northern Europe (especially the Netherlands, Sweden and Germany), Israel, China, Singapore, Australia and New Zealand. I know some amazing people in every one of these locations. One of the best teams I ever had the privilege to lead had members spread across Sweden, Silicon Valley, Boston, and India. We were building infrastructure that needed to support more than 20 million users and it’s not at all clear we could have succeeded without the talents of the specific individuals involved.

One of my favorite companies is MySQL, which is a company that has embodied this philosophy for years. They are nominally based in Silicon Valley and Sweden, but their product team and even their executives are scattered all over the globe. They are a true virtual organization, and they are able to benefit from some of the very best database and system software talent to be found anywhere. It is not easy for them to manage a completely distributed product team, but I’d argue that they very likely would not have been able to accomplish what they have if they had picked any single location on the globe, and tried to be a typical centralized company.

Just as manufacturing jobs were forced out of the valley in the 80’s, several other types of jobs are moving out – especially customer service, QA and to a somewhat lesser extent, engineering. It’s becoming common to have the architects and the QA managers located at the company’s headquarters, along with product management and design, and then to have more of the team at locations either together or dispersed around the globe.

The key is to realize that it’s all about the team. Many managers don’t quite get this, and they are stunned to learn that there can be as much as a 20X factor in productivity among their staff in the same job class. Which company will do better? The team that has 5 very strong people chosen for their proven skills, or a team of 15 that was hired or assembled based on their availability. This productivity factor can easily dwarf perceived financial savings. Similarly, it can turn a top engineer living in very expensive Stockholm into a bargain.

Today, for the most part, I see product managers, designers, architects and managers here at headquarters working with senior management, and then communicating to other product team members that may be remote. I’m just now starting to see some organizations where they put the full product team in the remote location, including product management, design and architecture, and I see that as a trend for the future, as product managers and designers get difficult to recruit locally as well (user interface designers are already very hard to hire here in the valley).

There are additional factors that come into play, but I argue that everything begins with the right product team, and if your product team decides you need to outsource, I hope you do it for the right reasons – in order to get the right people for your product team and not because you think you’ll save a few bucks.

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