Fundamentals of Product Management – For the Last Time

Fundamentals of Product Management – For the Last Time.

People often ask me why I write books and articles about product management.  Sometimes I write as an outgrowth of my benchmark research with results worth sharing for the greater good of our community.  Sometimes I detect patterns or trends in business performance that would benefit product people with a clarification or a ‘how-to’ guideline.  Still other times, I’m troubled by the actions taken by leaders in companies who direct efforts of product people that don’t directly benefit a customer or that promote decisions without strategic context. And these actions float down to the product managers who sometimes operate by the agendas of others, vs. the advocacy for the business of their products.

If there’s anything that does motivate me to write books, conduct research, and facilitate product management training is to accelerate a needed transformation in thought, practice, and business outcomes – so that leaders in companies can do better by being better.

Over the past couple of years, a number of software companies have emerged with tools that are designed to help product managers do their jobs. That’s great news. These companies produce e-books, podcasts, articles, and other content to promote awareness and create leads. From my standpoint, they don’t really care about the profession of product management. I’ve also noticed an increase in the number of books and mass market training for product managers. These books are written by people who were product managers and perhaps they found the secret sauce somewhere. As trainers, they convince bosses with less experience to take their purported experience, to stimulate change. Perhaps product people will write a better user story, or prioritize a backlog, or produce different roadmap; these are tactical activities.  Tactics don’t get you over the finish line. They just move the ball around.

What all this says to me is that this is commoditization and dilution at its greatest, and frankly does not sit well with me; someone who has promoted product management organizational excellence for decades – someone who’s written several first and second edition books (and soon, third editions), to help product managers and product leaders to be more effective and produce better outcomes. From my point of view, product management is not something to be commoditized, it’s something to be professionalized.

Regardless of these goings-on, I say: enough already. The Fundamentals of Product Management should be a given for anyone, and greater focus should be on customer and market insights, strategically important business goals, alignment, efficient development, and above all, product performance optimization.

With this context, I’ve decided to take some of the content I included in The Product Manager’s Survival Guide, 2nd ed., as well as other information, and encapsulate here into the five non-negotiable Fundamentals of Product Management that should serve as a foundation from which best business practices can be built.

What is Product Management?

Simply put, product management is the business management of products, product lines, or portfolios, holistically, for maximum value creation, across their life cycles. Managing products is akin to managing a small business within a bigger business. Sometimes an organization has one product, sometimes it has several.

Product management is, at its core, a model for a business organization. This model includes discovering, innovating, strategizing, experimenting, planning, developing, introducing, managing, and marketing products . . . and doing it over and over, as fast as your markets are moving. In essence, product management alters the genetics of the organization up and down, as well as across business functions. The function of product management is not a linear set of actions and workflows. Product management is not a single process.

Rather, product management creates a dynamic system that depends on the work of various people and many interconnected processes across the lives of many products and portfolios. Work ebbs and flows across the life cycle, iterating, improving, and optimizing.

Does this statement imply that product management supports the entire organization? No, not at all. The system of product management touches and influences all the organic supporting structures—all the business functions. Think of the human body: product management is in the genetic material; it’s in the skeleton; it’s in the circulatory system, the neural network, and, of course, the command and control center (the brain).

How Does a Company Benefit from Product Management?

Companies that excel in product management intensively focus on the identification of customer and market needs. They also ensure that they have targeted strategically important market segments. This kind of outside-in view of the marketplace increases the likelihood that they will produce the right product that brings about better business results.

Also, this perspective allows for the optimization of the product portfolio. Implicit in this view is the fact that the business benefits when products are treated like investments in a portfolio of businesses (products). With this approach, products become the building blocks of the organization. When this strategic perspective is understood and adopted, and everyone agrees on what’s to be done, people stop chasing shiny objects and focus on the business at hand.

To achieve a best- in- class organization with product management at the core, the following is required:

1. Well- funded market and customer research programs and skilled product managers to draw key insights from collected market data
2. A transparent, top- down, targeted portfolio strategy that clearly allocates funds to product areas that are deemed critical to the business
3. Finely focused product goals and strategies, based on relevant market and business data and extraordinary insights
4. A product development process that is geared to work with the cadence of chosen markets and the products within the portfolio. To reinforce a key point, a development methodology is not product management.
5. Data, metrics, and routines to learn, monitor, analyze, and continuously optimize the contribution of products and product lines

What Does a Product Manager do?

In larger, more complex companies, product managers are business managers, first and foremost. They work across functions and serve to integrate or synchronize the work of others so that products can be planned, developed, released or launched, and managed as they move through chosen markets. In start-ups or firms with fewer than 50 employees, the role of product manager could exist, but people in these positions may not be considered managers of a product’s business, either by themselves or in the eyes of others. The way I think of it is this: in a start-up, the founder plays a role that is akin to product manager or product leader.

As you know, good business leaders excel at steering others by articulating a clear vision and a common set of goals. They are able to anticipate problems, finesse what’s needed to keep everyone focused, and set the right priorities for the organization. As a product manager, you’re expected to have:

1. A deep understanding of customers or users and the challenges they face
2. An uncanny knack for being proactive in recognizing market trends and identifying competitive forces
3. The ability to envision a solution to a customer’s problem (a product or service) in the hands of a customer or user
4. A way to share that vision and ensure that people across the organization can imagine the same end point: a great product in the hands of a happy customer
5. An appreciation for the timing and cadence of work produced by people in various functions in the creation, deployment, and management of products
6. The creativity to inspire a collaborative environment with others in recognizing and solving problems
7. The utilization of softer skills to communicate, create political capital, influence others, and get things done
8. The ability to improve as a student of business and as a business leader

I cannot reinforce this point enough: If you aspire to be a great product manager, you will need to develop a sixth sense for markets, customers, people, and the intricacies of work flows in any organization. While you may not be there yet, if you want to be a great product manager, it’s vital to know that much of your success is determined by how you think and behave—and, of course, by the results you obtain.

How Do Product Managers Fit In An Organization?

As Abraham Lincoln once said, “Always bear in mind that your own resolution to succeed is more important than any other.” Whether you’re in a new job in a new company or you’re looking at your current role as a product manager, you always need to know who’s who and what’s what. While you’ll easily meld with your peers, it’s essential to know the others across the company so that you can establish relationships, clarify who does what, and get your job done.

Whether you’re interviewing for a job as a product manager or you’re already in the role, you’ve got to have a clear understanding of how your company makes money and how it’s organized. To accelerate your understanding of your company’s business model. Take a look at the book Business Model Generation: A Handbook for Visionaries Game Changers, and Challengers by Alexander Osterwalder and Yves Pigneur. This excellent resource provides a strategy that, as mentioned in that book, “allows you to describe and think through the business model of your organization, your competitors or any other enterprise.”

Learning your company’s strategy and how it influences the strategy for your product is invaluable. Understanding your product as in who it serves (your customers) and how it works is vital. Figuring out how everything works inside the company is critical.

One of the best ways to figure out how you fit, is to create an organization chart of the people in the functions with which you interact. Identify them by name, title, role, and so on. When you work with them, understand how they interact with product managers, other people in different functions with whom they work, and learn about the effectiveness of the communication or information that flows between those key functions. A couple of things will emerge.

First, through the conversations you have, you’re building a relationship, a key dimension of influence building. Second, you’re taking a broad perspective of information flow, which will help you understand where the bottlenecks are and how you can more easily facilitate information movement. In effect, this is your primary influence diagram.

As you’ll find out, if you don’t already know, leaders of functional departments usually operate by a set of goals (or agendas) that are not often shared with people in other departments. While there may be universal agreement among the senior leaders on the goals and strategy of the business, once the department leaders get back to their offices, there is a tendency to operate independently, or in “functional silos.” When this happens there’s insufficient information sharing and poor collaboration.

Your job is to understand these challenges and to extend your study of your company beyond the charts to the people. To really stay on top of things, you’ll need to create and update some kind of organizational map that helps you figure out who does what with whom. If you’re lucky enough to have inherited your product from an organizationally aware product manager with his or her own map, that’s a whole lot easier. If you don’t, consider your map as a way to orient your replacement when the time comes.

What are the Best Qualities Required for a Product Manager to be Successful?

No matter where you start out (or started out) as a product manager, you’ve got to be able to determine where you are so you can figure out what to work on as part of your professional development strategy.

Product management acumen is an expression I came up with to describe a person’s ability to grasp every aspect of a product’s business completely. This includes markets, people, systems, finances, performance measures, and processes. The term also is used to describe the attributes of strategic- thinking problem solvers who get things done in a complex organization.

Product managers must also comprehend the characteristics of the marketplace and, to a varying extent, the underlying technology (the domain in which they work). It may also mean an area of expertise such as programming, finance, or operations—things you may have studied in school or an area in which you have in- depth understanding.

While business leaders admit that there are some markets or subject areas in which the domain can easily be learned, there are other areas in which the level of effort required to understand the domain may be great, and that expertise requires extra time to cultivate.

There are a few dozen key attributes that are non-negotiable. Some are business. Some are behavioral. Some are the so-called soft skills. Some are associated with your mindset. To assess your own product management acumen, you can do a quick self-assessment by visiting:   https://survey.sequentlearning.com/s3/PMAcumen

Fundamentals of Product Management Summary

It is my hope that this simple level-setting helps. Sometimes, we get so caught up in the day-to-day tumult of our jobs, we don’t remember our true north: helping customers, achieving competitive advantage, leading teams, earning credibility, and producing results. You don’t need to be a master of product development either.

You do need to know the best way to utilize and integrate the work of people across the company to achieve agreed-upon strategic goals, and deliver the numbers at the end of the day.