Whether you come from a product-centric or customer-centric business (or consider yourself beyond any such labels), you will still agree that product management has been a crucial function driving business growth. From its inception in the 1930s, modern product management has evolved to keep up with the changing realities, but its importance has consistently increased.
Product management is a function that brings together the customer, business, and development & delivery functions together by channelizing the focus appropriately. From identifying the met and unmet needs and wants to ensuring that companies develop and deliver profitable solutions to those needs and wants, it covers the whole gamut of work necessary to enable business growth.
This article provides an in-depth understanding of this function and all associated dimensions to enable aspiring product managers to understand what it entails and decide their way forward.
What is Product Management?
Definition and Explanation of product management
There are many variations in the exact role of product management depending on the industry and the kind of work the business does. In FMCG environments, the Product Management function is responsible for the entire product lifecycle, from conceptualization to managing the revenues & profits and everything in between. In the technology sector, sales, revenues, and profits may not be the direct responsibilities of product managers, although they will still influence them.
Overarching Areas of Product Management Influence
Image Source: Product Management Tirad
The image shows all possible areas that product management can conceptually influence. If you see, it also includes sales and service aspects.
However, Neal Cabbage provides a better mental model to describe a more realistic picture.
Image Source: Neal Cabage
The current product management landscape means we must extend Neal’s product triad model, especially in the technology sector. The Product Management function doesn’t stop only at product development but is actively involved in product operations. This involvement is critical because modern products evolve based on customer feedback. Establishing the feedback loop is one of the most crucial needs for product management today.
To summarize in one sentence, product management is the function that influences, leads, and manages the entire product lifecycle in a way that meets both the customer and business objectives optimally.
Key responsibilities of a product manager
As the practical manifestation of the product management function varies from industry to industry and business to business, it is essential to understand that the role of a product manager will also change. However, we can define an overarching set of responsibilities and identify a few critical ones that must be present in every case.
1. Identify and understand customer needs and wants
2. Ideate and develop the right solutions to address those needs optimally.
3. Ensure that the product properly reaches its intended customers at the right time
4. Ensure smooth product usage and capture user feedback. Understand usage patterns and identify challenges and opportunities thereof.
Differences between product management and other related roles
While discussing the role of a product manager, it is critical to differentiate from similar yet distinct roles. The primary among those is a Project Manager and a Product Owner.
How Is A Product Manager Different From A Project Manager?
A project has a finite start and an end, producing a unique output at the end. On the other hand, products do not have a definite end. Going through the product lifecycle, they may become extinct, but that time can not be predicted. A project also has a specific output, while the product’s outputs will evolve in alignment with the desired outcome.
You may undertake multiple projects to develop product parts during the product lifecycle.
Keeping this Definition in mind, the following is the differentiation between a project management and a product management role.
How Is A Product Manager Different From A Product Owner?
A product owner is a role within the Scrum framework, an agile development methodology. The product owner is responsible for managing the product backlog and ensuring that the team works on the right items at the right time. They are also responsible for communicating with stakeholders and customers to meet their needs.
On the other hand, a product manager is responsible for the entire product lifecycle. They are involved in the product’s ideation, development, launch, and maintenance. They also must ensure that customer feedback is incorporated into the product roadmap and optimally meets customer and business objectives.
Critical Skills for Product Management
Product Management ensures the desirability, feasibility, and viability of the product. These three dimensions correlate with customer, business, and product development aspects. Hence, the skills required to be a successful product manager can be broadly categorized into three buckets.
Importance of Market Research and Customer Understanding
The external aspect of product management deals with the market and customers. Understanding both is critical to developing a relevant, valuable product that addresses customer pain points and contributes to business growth.
Understanding the customer allows you to identify customer needs and pain points. The insights and knowledge you gain through your efforts also will enable you to anticipate future needs, thus laying down the foundation for sustainable product growth.
Along with customer understanding, Understanding the market through market research enables you to understand the product positioning by understanding the competitive landscape.
Combining these insights can also help you minimize the risk of product failure. In addition, the knowledge will help you determine where you should focus your efforts most, increasing the Returns on Investment (RoI) and chances of success.
Importance of Strategy Development and Execution
Strategic thinking involves aligning business goals and objectives with customer pain points and their solutions. To do that effectively, product managers must consider various factors, including market conditions and trends, competition, and technological emergence, to develop a keen sense of the market landscape and determine where and how their product can fit in. This holistic view enables a product manager to determine the product vision and product-market fit.
Once the strategy is in place, the next step is to develop a concrete plan founded on this understanding to determine how the product will achieve its goals. This plan includes creating a product roadmap, prioritizing the effort, and determining the resources required to achieve the goals.
Such strategic thinking results from a keen understanding of customer needs, product target markets, and how the product can differentiate itself from the competition.
But having a strategic plan in place is not sufficient. The execution is far more critical. Product managers must also consider potential risks and challenges and develop contingency plans to mitigate those risks. They must also establish metrics and KPIs to measure the product’s success and adjust the strategy based on data-driven insights.
Importance of Data Analysis and Decision-Making
In today’s uncertain and volatile business environment, holding on to the initial customer and market understanding is insufficient. One of the most critical steps that successful product managers take is establishing shorter feedback loops to validate their product development assumptions and establish market validity.
Data-driven analytics and decision-making allow for objective decisions and overcoming biases and subjective preferences. The data analysis allows the product managers to measure product performance, understand feature usage and needs, prioritize further development, and align the roadmap that helps respond to customer pain while helping the business achieve its objectives.
Understanding the Product Development Process
So far, we have discussed product management and the role of the product manager. Next, we will discuss product development, building great product teams, and general opportunities and challenges that product managers face. Let’s start with product development.
The product Development Life Cycle is different from Product Life Cycle. Product Lifecycle describes a product’s phases from the business perspective. The following is the typical product lifecycle process.
Critical steps in the product development process
The Product Development Life cycle differs significantly, focusing more on the product’s development phase. There are a few variations in the steps involved in the PDLC. However, combining all those steps, the following can be considered the most suitable to represent PDLC.
Ideation
The ideation step is the foundational step for any product development effort. It starts with collecting ideas, validating them, and prioritizing them.
There are multiple sources from where the ideas come. In top-down product cultures, they come predominantly from the business leaders or the product managers. Then there is bottom-up culture, especially in technology companies where founders are also hands-on professionals and engineering teams bring new ideas. And then, there are customer-led ideas where the product team prioritizes everything from the potential or existing customers.
Balancing the idea sourcing from all sources and channels is essential. Here is a case study on how Dropbox did it.
Validation
Once the ideas are sourced, the next step is to decide which ideas are worth pursuing.
Multiple frameworks help you do that. RICE from Intercom is a known one. A product Tree is another gamified way to ensure that superficial ideas are pruned from the product tree. Of course, speaking with customers and actual users to validate your understanding of the ideas goes a long way.
You must start identifying your product’s core value proposition from this stage. The core value prop guides the entire product strategy and all further product development efforts.
Prototyping
Once you have a short list of validated ideas, you must figure out a solution and test how it will work in real life. Prototypes are ideal for ascertaining the feasibility of the conceptual solution.
While the overall customer experience (CX) will get finalized later, product management teams should start thinking about it from this stage. The CX elements will guide the product messaging.
Messaging
As the prototype is being built and you start gathering feedback, you should also begin building the business-oriented processes and artifacts. Since the feedback is still coming in, creating the product messaging will be iterative. As you build the messaging, you should focus on the following few things;
- Finalize the product’s core value proposition and decide how to convey it.
- Build the marketing funnel and the campaigns and communication for each stage of the marketing funnel.
- Create a continuous outreach and education strategy for the entire funnel, including existing customers.
Build
The build phase is where the product is developed and tested until it is ready to be launched in the market for general customer consumption. The messaging part starts with the prototyping and continues throughout the build phase.
Launch
In this phase, the product is launched in the market and is available for general use. You will start getting users onboard depending on how you have set up your acquisition and activation strategies. You can capture the data about their usage patterns and behavior while working with the product.
Improve
As the pace of change is increasing, it is essential that your product, too, evolves continuously to meet the new challenges and changing needs. Technological advances are creating opportunities to develop innovative solutions for existing complex problems. Competitors may bring up products and features that provide better ways to solve the problems for your customers.
At the same time, it is essential to understand how your product is solving real user needs. What problems are they still facing, and what can you improve to provide more value to them? Alongside the customer value, meeting your business objectives is equally critical.
Be it Deming’s Plan-Do-Check-Act (PDCA) or Lean’s Build Measure Learn, the importance of establishing the feedback loops to analyze the outcome of our efforts and take measures to make them more effective is well understood. The improvement activities are feedback to the ideation process, and the life cycle continues.
How do product managers fit into the product development process?
Product management is a function that plays a central role in balancing the customer, business, design, and engineering expectations while ensuring overall value delivery for every stakeholder. Product Managers play a multi-dimensional role throughout the product development process.
Ideation
During ideation activities, the product manager must work with businesses and customers to identify the needs, generate solution ideas, understand the competition and markets, and develop a product vision and strategy that balances the business and customer expectations.
Planning
Based on the product definition, the product manager must work with design and engineering teams to plan and execute the strategy. The planning activities involve product roadmap building and prioritization.
Execution
When the project is being built, the product manager must ensure that the outcome is aligned with the product and business strategy and will be valuable for the customers. They also need to ensure the product will provide an optimal experience.
Delivery efficiency will be another aspect that the PM will need to focus on. In general, shorter cycles that incrementally push features to the customers will enable the PMs to gather feedback quickly and change course if necessary. Choosing the right processes, frameworks, and methodologies is critical. However, the chosen frameworks must align with your business’s context.
Launch
The Product Manager is best placed to assist the marketing and sales team by defining the launch plan and strategies and executing them to launch the product. In addition, the PM must work with marketing and sales functions to develop a variety of literature to make the launch and subsequent customer onboarding smooth and efficient.
Iterate
Once the product is launched, you must consider how the customers find working with it. As a PM, you must set up efficient Analytics capabilities to measure the progress towards the business goals, understand the user actions and behavior, and identify areas of improvement for the product.
Building a Strong Team
A product’s sustained growth depends on how good a team you can build. A successful team helps you generate innovative and creative solutions aligned with the business and product strategy, vision, and roadmap. However, it takes significant effort to build a successful team. Let us see some characteristics of great product teams;
1. A great team knows what’s expected from them and proactively fulfills those responsibilities. The team is also aligned with the shared goal.
2. They foster an environment for clear, open, and effective communication.
3. They foster a collaborative work environment that encourages the easy flow of ideas and implements shorter feedback loops to ensure they are progressing adequately.
4. They are focused on optimally solving customer needs while ensuring that business goals and objectives are met.
5. They work with nimble and efficient processes. A good team is attuned to changing business environments and customer needs and can adapt quickly.
6. A great team is courageous enough to make the required decisions to deliver the product. At the same, they are empowered to make that decision in an environment of psychological safety and trust.
7. The team is result-driven, with clear expectations of outcomes. They continuously measure their progress objectively and do quick course corrections if necessary.
8. A great team is a learning team. They constantly seek avenues to improve their processes and outcomes and create better results for the business and customers.
Importance of cross-functional collaboration in product management
While your organization design will determine the nature of your product team, it is necessary to ensure that you have cross-functional inputs coming in to ensure that you are taking care of all dimensions of building a great product.
Long-lasting, stable product teams are always recommended to ensure that the tacit knowledge acquired remains with the team and is utilized. However, it may not be possible, given the practicalities of the business environment. Especially when it comes to having people from multiple functions constantly reminding the product team, it may become difficult.
A cross-functional team is essential for building a great product because it brings together individuals with diverse skills, perspectives, and backgrounds, all of which are needed to create a successful product. Here are some reasons why a cross-functional team is a must for building a great product:
- It enables a better understanding of customer needs with thoughts and input from multiple areas, including marketing, design, engineering, and customer support.
- The diverse perspective of people coming in with various backgrounds, experiences, and thought processes help generate innovative ideas to solve problems.
- Inputs from multiple perspectives help ensure that decisions are well-informed and consider different points of view.
- A cross-functional team has better flexibility to shift resources and adjust priorities to adapt quickly to changing circumstances.
- A cross-functional team can also speed up the delivery process by adopting a parallel work pattern instead of a sequential one.
In summary, a cross-functional team is a must for building a great product because it brings together diverse perspectives, promotes better decision-making, improves collaboration, increases agility, provides a better understanding of customer needs, and speeds up time to market.
Role of the product manager in leading and facilitating collaboration
A Product Manager will typically have no formal authority over any other function. Yet, the PM must influence people across functions and ensure their optimal contribution toward ensuring successful product outcomes. To achieve this, the product manager must be good at leading and facilitating collaboration.
Collaboration is when multiple people, typically each with different skills, ideas, thought processes and backgrounds, come together and work towards a shared goal. Traditionally, handoffs were involved with project teams, where the work was passed from one function or team to another. Collaboration is typically different where despite specialties, there is a proactive participation of everyone on the product team to provide inputs and ensure work progress towards the outcome.
There are inherent risks and challenges to the collaborative approach.
- If not managed well, such initiatives can create conflicts between team members since everyone has different opinions and perspectives.
- For collaborative efforts to be effective, they must be built on the foundation of open, honest communication. Conflicts, biases, or egos can pose challenges to such an environment. If communication breaks down, the collaborative efforts do not yield any results.
- Another challenge to managing is to ensure efficient decision-making. In the collaborative setup, it takes longer to make decisions, especially if accountabilities are not fixed.
- It is also critical to understand that the team can lose sight of the shared objectives if the product manager doesn’t manage the interactions well and keeps the efforts aligned with the product vision and strategy.
For a collaborative effort to be successful, the product manager must create an environment of trust and psychological safety. Many tools and techniques can help you create a thriving collaborative environment.
Clear and effective communication is the key to achieving the desired outcome through such collaborative efforts. Whether it is to establish a shared understanding of the shared goal and expected outcomes or to work with the customer, stakeholder, or even peer feedback, a product manager must ensure the team can utilize communication to progress. Product Managers themselves use active listening, empathy, and negotiation skills to drive cross-functional teams toward desired outcomes.
To Be Continued…
In the next part of this article, we will understand product management challenges and how to mitigate those. Stay tuned…
