Product Management Success
Ruth Hartnup - General Store
Product management is business management. Building/buying a product for X and selling it for X+Y is a business. The goal being to minimize the X and maximize the Y while capturing as much market as possible. So, the product manager’s job is to manage the business of their products through working to achieve these goals.
Though it’s easy in concept, achieving this goal is extremely complex. The product manager has to work across a diverse set of work groups to make sure the right product is delivered at the right time at the right cost, as well as having it positioned to capture the attention of your buyers. This requires careful coordination between design/engineering, supply chain, sales, marketing, and operations in order to deliver. A good product manager must build relationships across the entire organization to leverage each group to achieve success.
The CEO of the Product?
Because the product manager is required to work across all the groups within an organization, many people refer to the product manager as the CEO of the product line. This is true in many ways. You must know everything about the product and the business they’re a part of. With this knowledge, you develop and communicate the mission and vision of the product portfolio both internally and externally. And, you work with business partners to execute on strategies required to achieve your goals. Fundamentally, these goals are to decrease X and increase Y while reaching the greatest amount of the market.
The issue with the CEO illustration is that there are no formal reporting lines for the actual people who will help you to achieve the lowest X and the highest Y. Typically, sales, operations, marketing, supply chain, and engineering report up through their own organization and have their own goals required to meet the demands of their boss. The result is a CEO that can only influence the groups to help him/her, rather than direct them.
Initially, this slows progress. Just like in any relationship you must establish your business partners’ trust to achieve the necessary influence to implement your vision. Building trust takes time, however once established can be more powerful than a direct reporting line.
“If you’re communicating engineering, supply chain, or marketing needs and you don’t know the market how are your partners going to trust that what you’re asking them to do is going to make an impact?”
How does a Product Manager build trust with business partners?
It starts with the market
Selling as many products as possible while minimizing the X (cost) and maximizing the Y (profit) is the goal, but how is it achieved? The starting point is learning the market. The value of the market is a combination of how many of your product could be sold and at what price, this results in a total dollar value or Total Available Market (TAM) for your product. Sometimes this calculation is easier than others, however the total value of the market is just one data point needed to understand the market.
The market itself is just a collection of individuals. Real people are making decisions about their business or about what goes in their pantry that create the value of the market. To understand the “market” you must understand these people and what they care about. Having a keen understanding of the human element of the market will provide a window into where the market is moving. Which is usually more important than what is the current state of the market, due to the lead times for product development and supply chain.
Market knowledge is developed by spending time with the people that make up the market. Go with the sales staff on sales calls, make sales calls, spend time with the sales staff, attend trade shows; communicate with them. It’s critical.
As a product manager, understanding of the market and where it is going is the foundation of the value that you provide your organization. It is the context that guides all the decisions and direction that you communicate with your various business partners. Because of this, it is also the foundation on which the trust you build with your business partners is based. If you’re communicating engineering, supply chain, or marketing needs and you don’t know the market how are your partners going to trust that what you’re asking them to do is going to make an impact? Any request from a business partner should start with an explanation of how their action will affect the product line’s ability to meet the needs of the market. Clear communication of market intelligence must be done consistently to align your goals with that of your business partners.