What Is Product Management?

Simplistically, product management is a lifecycle function within an organization that involves dealing with the planning, forecasting, and production, or marketing of a product or products at all stages of the product lifecycle.

Defining Product Management

When I wrote the book, Managing Product Management, I entitled the first chapter “Reinventing the Wheel for the Last Time.” Because I’ve been a participant, observer, researcher, and thinker about all things product management for a long time, I wanted to reinforce some key points.

Why? You may ask. Why now? We all know what product management is and does. Don’t we?

How about this: Ask 20 people how they’d define product management. I’ll bet you that you’ll get 20 different responses… or pretty close to it.

As you can surmise from your own discovery of asking people that their definition entails, you could conclude that the number variations on the definition are a reflection a problem. This is especially important when it’s inconsistently defined in your own company, or in any number of companies – regardless of industry or sector.

To me, this is a big issue because when groups of people with a common mission or purpose can’t speak the same language, a lot of confusion ensues.

As I’ve written elsewhere, the role of product management as a functional discipline in a company is poorly understood, and its associated practices are inconsistently applied. Therefore, to get everyone on the same page, let me explain product management to you. I’ll do this by breaking down each of these sections into:

1. What is a Product?
2. What is Management?
3. What is Product Management?
4. Why are Product Managers so important?

WHAT IS A PRODUCT?

Products are bundles of attributes (functions, features, benefits, and uses) and can either be tangible, as in the case of physical goods; intangible as in the case of those associated with service benefits; or can be a combination of the two. That’s a good start. But there’s more.

A product is not always a single, standalone item; instead, within most companies, there is a hierarchy of products and services.

A product may be part of another product or product line, packaged with a group of products or offered as a solution or system to meet broad sets of customer needs. Products and product lines are usually part of a larger product portfolio—either in a single firm, in a business unit, or in a division of a larger company.

Alternatively, products can be broken down into product elements, modules, or terms (as in a credit card). Products may be built upon product platforms or product architectures.

There is a great illustration of this in The Product Manager’s Desk Reference (2e), which is shown below. This is also important if you’re trying to figure out what your job is. While a product manager may “own” a product or a portion of a product, it’s vital to see how it fits into the bigger picture.

For example, if you were a product manager responsible for an automobile navigation system, you’d be in charge of a module of a larger solution. On one hand, your navigation system would be part of the telematics complex of the automobile. However, it may also be connected to antennas, possibly cameras and radars, too. Yet, the customer buys the automobile as a solution to their transportation problem. You’re only responsible for a piece of that.

This perspective is important for product managers who sometimes have concerns about where they fit. It’s also important to bosses who have to properly organize product management in the company.   You can refer to the entire taxonomy and further definitions in chapter 1 of The Product Manager’s Desk Reference (2e).

What is Management?

The word management derives from Latin: manu agere, or “to lead by the hand.” In most books about management, definitions generally include the usual cycle of business elements that include:

• Setting goals
• Motivating, managing, and engaging people; building a collaborative environment
• Utilizing or deploying financial and human resources
• Making decisions
• Assessing outcomes – assuring quality in deliverables
• Reassessing and/or resetting goals

Management involves the alignment of people and processes so that work can get done and in the achievement of desired goals. Management does not involve “command and control” and ordering people around.

It is also not intended to perpetuate bureaucracy. In modern businesses, management means that the contributions of specialists in the organization are harnessed, that decisions are made, and goals achieved.

If you can grasp that management is a cross-functional, cross-organizational discipline, it’s easier to understand the role of the product manager. In product management, the person in charge is the product manager. However, considering the multifaceted definition of product established earlier, it is not safe to assume a one-to-one relationship between product and product manager.

While that model may hold true at some organizations, a product manager can be partly or wholly responsible for all or part of a product platform or architecture, a module or series of modules, a single product, a product line (a small product portfolio), or several product lines (a larger portfolio).

What Does A Product Manager Do?

When I was a product manager and later a product leader, I was responsible for ensuring that the business of the product was carried out.   It’s a big job, and it is sometimes hard to get your mind around.   Nevertheless, if you can relate to the trade-craft tradition, you can harness this awesome job.   It’s not possible (in this article) to fine-tune the role and its responsibilities completely – but below is guidance to briefly describe seven key attributes of what’s needed to be successful in the role:

1. Assessing markets, including the competitive landscape (companies, products, etc.), evaluating the industry or sector of your company and that of your customer’s (in a B2B setting), and of course, the needs of customers within targeted or chosen market segments.
2. Setting direction with agreed-upon goals and strategies for the product – consistent with the goals and strategies of the organization where you work.
3. Guiding teams through customer or user journeys and stimulating ideas for appealing Product designs and engaging experiences
4. Leading and influencing those who work in other areas – namely cross-functional team members whose specialties are needed to support the goals and strategies established for the product’s business.
5. Integrating and synchronizing the work of many people by seeing the big picture of the product’s business.
6. Solving problems and making decisions based on financial and market data, consistent with agreed-upon goals and strategies.
7. Forecasting, finance, and analysis, because it all comes down to numbers and positive outcomes, and optimizing all aspects of the product’s business as it moves through the market.

In companies that use agile or iterative product development techniques, a product manager works closely – or even guides the work of a product owner. The product owner is not a product manager but contributes to the ongoing development or updating of the product. A product owner may focus on the goals for a user story, determine acceptance test criteria, determine the release schedule, and keep the development team focused on features to be developed.

What is Product Management?

Based on the answers to the first two key questions, 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, as I mentioned earlier.

I find it interesting, if not puzzling that many companies have had their epiphany and paying more attention to the “function” of product management. Why?

They recognize that product management offers a way to improve their former style of management. They want to focus on meeting the needs of their customers with products that are run as mini-businesses, that is, small businesses within their overall business. In addition, these companies are seeking to collectively manage all the products within a product line or portfolio in the way one might manage a portfolio of investments.

There are a variety of drivers for decisions to focus on this, including poor product performance, product duplication in global markets, and even channel conflict. Reform is engendered by problems, and it is usually some business problem or challenge that leads an organization to product management as a way forward.

Product Management (big P, big M) is, at its core, a model for a business organization. This model includes discovering, innovating, strategizing, planning, developing, introducing, managing, and marketing products. In essence, Product Management alters the genetics of the organization up and down, as well as across business functions.

To reinforce this, refer to what I wrote in my book: Managing Product Management: The function of product management is not necessarily a linear set of actions and work flows. Rather, it is a dynamic system that depends on the work of various people and many interconnected processes across the lives of many products and portfolios.

Does this statement imply that product management supports the entire organization? No, not at all. Though Product Management is genetic, it 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 Product Management Transform a Business?

Firms that excel in product management generally focus on the market. They also concentrate on the validation of market segments and the explicit needs of target customer types. This kind of outside-in view of the marketplace increases the likelihood that they will produce better business results and optimize the value of the product portfolio. As mentioned earlier, implicit in this view is the fact that the business benefits when products are treated like investments in a portfolio of businesses (products), allowing for a more granular approach to strategic and tactical product planning. With this approach, the products become the building blocks of the organization.

When this strategic perspective is understood and adopted by a firm, and everyone agrees on what’s to be done, people stop chasing shiny objects and focus on the business at hand. Further, they are invested in the future of the business, and in the rewards gained through positive experiences provided to customers and the associated competitive stature.

The steps involved in transformative product management are seen through a keen understanding and practice of the jobs to be done in any product business. These include:

1. Garnering market insights
2. Formulating product and market strategies and resultant roadmaps
3. Determining where to invest (and prioritizing accordingly)
4. Designing and planning
5. Developing and redeveloping
6. Introducing and releasing
7. Optimizing performance and fine-tuning the business

I recommend you download the product management framework to get a better picture.

In my book Managing Product Management, I placed great emphasis on the fact that product managers should not be considered a passing fad, something nice to have, or the strategic imperative of the year. In the twenty-first century, businesses compete on a global scale and competitive forces are relentless.

While product management is on the organization chart in many companies, as I suggested earlier, the roles and expectations of product managers tend to vary widely. In my experience, a lot of the confusion in this area stems from people trying to figure out product management on their own. They develop an approach based on their own operational or functional paradigms, or what the leaders think it should be.

This very often leads to inconsistent, ineffective business operations. When product management isn’t properly chartered, aligned, or scoped, people have to work harder to achieve the same goals.

Therefore, product management must be a core capability, and organizational models must be altered to support the function of product management and to effectively utilize the capabilities of product managers.

Tune into my podcast, Masters of Product Management to listen to the episode on What is Product Management?.