3 Step Guide to Successful Product Management
This high-level guide will help you understand the role of product management and walk you through the steps required to successfully recruit, align, and leverage a dedicated product management team.
In the early stages of most software companies, product development tends to go something like this: a company’s founders identify a pain point or need, assemble a small engineering team to build a solution that addresses it, and proceed to go through a number of quick iterations to tweak the product to better meet the market’s needs.
It’s a system that relies on innovation, flexibility, and customization to fuel growth. And, in that early (often unstructured) environment, it’s a perfectly acceptable product strategy.
But there also comes a time in a software company’s development when throwing a bunch of ideas against a wall — or on the aforementioned engineers’ desks — and seeing what sticks is no longer effective. In fact, that strategy often inhibits efficient growth.
The Need for Software Product Management
At the expansion stage — when a premium is placed on efficiency and scalability — a software company needs to have a stable set of product requirements that can be carefully allocated to a product development team, and a product strategy that more formally aligns with its overall business strategy.
This is why, at some point in almost every software company’s growth, businesses need to develop a true product management function that can act as a buffer between business strategy and product development, and ensure that product strategy aligns with customer and market needs.
Unfortunately, implementing product management can be a little bit tricky, and many businesses often confuse product management’s responsibilities with those of other departments, leading to a host of roadblocks that make life difficult for product management organizations.
This high-level product management guide should help you avoid those challenges by covering three critical steps to successfully implementing a product management function.
1. Define: What is Product Management?
As product management expert Saeed Khan wisely suggests in this post, a true product management function isn’t simply an extension of a software company’s marketing or engineering departments.
Instead, it’s a separate strategic function that must be responsible for driving new product development strategy, focus, and alignment, and market clarity. As such, product management functions must be solely driven by the success of the product, focusing on questions like:
- How will the product compete in each market?
- What can you do to take it to market?
- How should the product be priced and licensed?
- How will customers in each segment use the product?
Essentially, Khan explains, product management is a business optimization function that oversees technology and product all the way from development to go-to-market. Areas such as channel development, marketing strategy and positioning, and customer management are all part of overall product management.
2) Hiring a Dedicated Product Management Team
So, whose job is product management at the expansion stage?
As I’ve written before, it’s not the CTO’s or the CEO’s. Instead, companies need to create a true product management function that houses several different roles and leaders, including:
- The team leader (VP of Product or VP of Product Management):This is the person who will own the product and set the vision and strategy for it.
- Product manager(s): This is the team member (or members) who are charged with developing true empathy for customers and creatively solving problems for them.
- User experience managers, researchers, or designers: This group is responsible for quickly examining a product’s layout and information architecture, and interpreting the changes that can be made to make it easier to use.
Product management guru Marty Cagan, the founder of the Silicon Valley Product Group, does an excellent job of describing the various product management roles in greater detail in his paper, “Behind Every Great Product,” which is largely considered the Product Management resource.
Generally speaking, however, Cagan says that implementing a high-functioning product management function begins with hiring a product leader who excels at the following:
- Identifying and assessing opportunities
- Defining the right product at the right time
- Setting the product strategy and roadmap
- Representing the product internally (through evangelism, executive review, and sales and marketing support)
- Developing a deep empathy for the target customer’s needs and pain points
If you can find that person to lead your product management function, he or she should be able to build the team he or she needs to succeed.
3) Overcoming the Inevitable Challenges of Implementing Product Management
Unfortunately, finding product managers who can successfully perform all of the responsibilities listed above isn’t easy.
And even if you do find them, integrating that role and the product management team with the rest of your organization is an altogether different challenge that requires product leaders to overcome several roadblocks, including:
- Determining what exactly you are solving for. Until you know that, you don’t know what specific skill sets you need to hire in-house to achieve that goal. The ideal way to begin, says Central Desktop VP of Product Management Kristy McKnight, is to start with the company aspirations, goals, and objectives, and determine how the product fits in and needs to support them.
- Acquiring the appropriate ownership over the product and the outcomes of product decisions. That can be a tricky transition. In the early stages of a company’s development, the responsibility of product management tends to be shared between the founders, or the marketing, engineering, and sales organizations, typically in an ad-hoc manner. So the challenge when you get started with product management is to show those team members the benefit of passing ownership of those responsibilities to product management and developing the trust that a formal PM function will improve the efficiency and performance of the overall operation.
- Avoiding organizational misalignment: At the startup phase, when the priority is on revenue generation regardless of customer segments, the sales department tends to drive the product backlog. When product management is officially implemented, however, that responsibility must fall on product managers, and it’s their job to keep everything in context and prioritize work on broader needs or larger opportunities. This power swap can create a divide between PM and sales or marketing, and create team-wide misalignment.
The key to avoiding or overcoming those challenges, says McKnight, is to ensure that everyone understands their new responsibilities and respects their role relative to the organization’s short- and long-term goals.
If you’re recruiting the right profile, giving them enough ownership, allowing them to contribute directly to the success of the business, and tying each of those things together, accomplishing that shouldn’t be a problem.
Implementing Product Management Isn’t Easy, but It’s Worth the Trouble
In the end, it’s critical to remember that product management isn’t a replacement for product development, product marketing, or professional services. Those are all very different, but complementary, functions within a growing software company.
As such, the ultimate objective of product management is to understand business strategy, translate it into a product strategy, tie both to the company’s target market segments, and define the differentiated product solutions that product development needs to build to meet those market segments’ needs.
Achieving that isn’t simple, of course, but investing the time into properly developing and managing a true product management function can pay huge dividends and unleash true operational efficiency.
What tips would you add to make this guide to product management more complete?
How did the team at SurveyMonkey know it was time revamp their pricing strategy? Find out which signals tipped them off and how they made it a success.
Mike Walsh, CMO at Reflektive, has gone through multiple pricing processes and has developed his own framework for assessing the situation and then developing pricing that is appropriate and effective. Learn more about his 4-step framework here.