Product Management for Corporate Glue AND Lubricating Oil

Product Managers have a fascinating, all-encompassing role. They can be called many things, CEO of the product, Janitor, Super User. See Product Manager is a janitor basically.

All other business functions are well understood: 

• Engineering develops the product
• QA assures that the product 
• Sales converts a product into justifiable business value for each customer
• Marketing communicates the product proposition to a market of similar users / buyers

etc

But what do Product Managers do? 

• Product managers are frequently the glue that keeps the rest of the business functions inside a technology organisation stuck together. They fill in the cracks in between all these business functions.
• And they are the corporate 'oil' that lubricates other business functions within the company, making each function more efficient and in better harmony with each other.

Example

The next version of the product is coming. It's in Engineering. Product Management has defined the requirements of the product and during the build cycle, it assists with dilemmas and issue resolution.

QA is shaping up to receive the product, but this new version is more sophisticated than the previous version. The QA team need to understand the common use cases / user flows in order to write system / regression tests. They rely on Product Management for guidance.

Marketing is familiar with existing positioning, but this latest release opens up new markets and positioning. They rely on Product Management for guidance: what are the USPs? what are the best use cases? how should it be positioned and to whom? 

Sales may not be able to help for lots of reasons - they want to sell the existing products, not ones that aren't on the price list yet. The rest of the company is dependent on the Sales team selling the existing product in suitable volumes in order to pay the salary bill each month - you really want them sticking to the knitting and selling what's in the warehouse now, not yet-to-be-proven products still on the production line.

Additionally, they have had limited exposure to it: feature and functions aren't well understood yet, positioning isn't developed, use cases and case studies are embryonic at best

Account Management and Support want to know what's different about the new product and how can it be positioned to existing customers and how can they benefit most from it. Is it as good as the existing product? Can existing customers try it before they buy it etc? What the known limitations?

So, often it is the product manager / marketer that goes prospecting for beta customers and manages the beta programme(s) to their successful (hopefully!) conclusions. See the The challenge of beta programmes and Product Launch vs Release vs General Availability vs Deployment.

As a result, it is Product Management who is at the heart of technology product company, acting as its glue and the oil - and that's not contradictory!

See also How everyone else views the first-in-post product manager

How everyone else views the first-in-post product manager

CEO mutters that maybe it is time to hire a product manager.

Everyone else wonders, "Err, and how will they help?" And they get that uneasy feeling that the company is going to be less fun and more restrictive and more "NO!" Perhaps the first publication of the Employee Handbook had the same reaction - mildly menacing, but necessary for some (other) slightly dysfunctional part of the business, but not for me.

Below I augment the great story that Product Focus (a well-regarded provider of product management training) tell in their Product Leadership Workshops and, to some extent, is outlined in their publication, "What is the point of Product Management?"

Here's the history of a B2B software company and the welcome emergence of product management.

The small company was founded on technical innovation and good customer service to its early customers. Initial Product Management is executed by the CEO. The company continues to thrive, and the CEO's time gets further and further sub-divided, but the technology and the product remain his/her passion.

But a new Sales Director joins the company and complains, "We’re a technical-led company. We need to become customer-driven." And that sounded fine except every new contract required custom work. Contracts were signed with a dozen clients from a dozen market segments. Soon the costs to support all these different products started to escalate. The latest customer’s voice always dominated the product plans. The CEO concludes that “customer-driven” meant “being driven by the latest customer”, and this created short-termism to the frustration of Engineering with the creation of massive technical debt and the sense of favouritism towards particular Sales team(s) creating lots of subversive backdoors to decision-makers. The price list becomes a joke, as the Sales team somehow manages to get colossal discounts on big deals using the mantra of 'a strategic customer deal,' without regard to profit margin. 

When a board member declares, “We’ve become a sales-led company. We really need to start being market-driven,” a brand specialist is head-hunted away from a big consumer product company to be your VP of Marketing. As part of a re-branding initiative, she designs a new corporate logo with a new colour scheme for the web site, new collateral, and an updated trade show booth and a big expense budget for conferences. Hundreds of thousands of dollars are spent without any change in revenue.

Soon the CFO whispers to the CEO, “Don’t you think it’s time we started controlling costs?” So, the company becomes cost-driven and started cutting out all the luxuries like travel, technical support, bonuses, and employee appreciation. Everything had to be justified with a business case and the CFO was tough on any assumptions – the only things that got past him were small evolutions of existing products. Account management was lauded for winning incremental business, usually with small but exotic customisations which started to build technical debt and make upgrades to new product releases more and more painful. And, innovation stalls, engineering resignations escalates!

At this point, when Finance has gone too far, margins have suffered, and the future product pipeline looks thin and also-ran. The CEO steps back in and is sorely tempted to take the company back to its technology roots but he/she knows that this needs to be tempered with supporting existing customers and protecting existing revenue streams. So, a new, hybrid approach is required – so the company recruits a product manager.

The CTO and the Head of Engineering welcome the idea. Finally, the Product Manager is the go-to person to make sure his/her team build the right stuff and have a solid, defensible product strategy. This prevents his team/technology from being yanked around all the time OR working on the latest, crazy C-suite initiatives OR brainless product customisations for the big customers, that don't make sense and will become a mill stone around the neck of Customer Support in the future.

But the Head of Sales is also keen. Her team can’t answer the tough questions customers are asking. Finally, someone with lots of product expertise can answer technical questions without murdering customers currently in pre-sales with infinite complexities and CLOSE SALES! The perfect PM should answer customer RFPs (Request for Proposals); AND come out on sales trips whenever they’re needed; AND be the demo jockey; AND talk authoritatively about future product releases and when they will occur. They should also be able to write some technical whitepapers and do some decent competitive analysis.

Marketing, who if you’ll remember lost a lot of credibility with their splurge on branding, are also having problems with their collateral. Their vague product brochures and website content don’t seem to hold customers' interest and come in for a lot of criticism from prospects and internally. The Product Manager can explain the product once and for all, providing decent product messaging and propositions for the collateral. A product roadmap with some realistic dates would allow her to plan marketing spend, rather than a knee-jerk reaction to product releases or to cancel events sponsorship at the last minute due to another slippage in the product release date.

Finance is relieved to hear about Product Management arriving. Finally, there’ll be someone to hold accountable for whether each product is making any money. The CFO immediately starts working on a new, complex, business case spreadsheet that the Product Manager will be tasked with completing and comes up with detailed KPIs that the new product managers will measure for him!

By this stage, Account Management & Customer Support have almost lost the will to live. Every day, they writhe in agony trying to solve exotic customer problems which Testing and Engineering struggle to recreate, never mind solve. They see the new Product Management team as the last hope to solve the Sales madness of selling solutions that are further away from the core product offering and hanging Customer Support out to dry AGAIN. Otherwise, they are definitely throwing in the towel and quitting.

Conclusion

Everyone has their view of what the perfect product manager should be doing – it’s helping them do their job! In truth, Product Management should be greasing the wheels of all these business functions because they put the product's holistic success at the centre of what they do..

About Arthur
A Product Manager who enjoys taking new technologies and concepts to market. Fascinated by software, internet and mobile sectors. Start-up and scale-up specialist. Based in Cambridge, UK. For more information, see www.stream121.com.

Rich Mironov on Product Roadmaps

The great Rich Mironov, a well-regarded product management guru, speaks about the negotiating your product roadmap for B2B software companies.

War stories, methodologies. An excellent video that can be easily consumed.



Rich was speaking at the Business of Software conference held at the start of October

I'm going to pull out one insight (amongst many):
4. Share trade-offs and scorekeeping with Sales leadership (at about 46 mins)

Rich talks of a mechanism by which the product management 'trades' the focus of the engineering team with the Sales team. His process requires Sales to metaphorically 'pay' for a feature - he uses a virtual token. This makes the Sales team prioritise which 'extra special' feature required for their 'super critical' strategic deal and then proceeds to pay for it.

Excellent concept - and one that doesn't apply just to Sales. I have applied it to Research as well:

"We really need Jenny to evaluate XYZ technology and blueprint a solution because she has the most applicable expertise."
"OK", I say, "What of the development plan in the next release are you trading out?".

SCOTSMAN for sales qualification

My previous blog post about communicating the commercial imperative of products was originally prompted by how frequently I, as a Product Manager, have discussed sales qualification of a prospect with respect to product differentiation and competition.

Frequently I had shared my insight with the sales teams:

• "If customers says their problem is this, then this implies that they have solved this, this and this problem with  an alternative solution. As a result, they aren't a good prospect unless they have this characteristic."
• "If a customer is asking about this feature, then that implies that they are currently used competitor X's product, as we know that this is their weakness. It would be best to differentiate our product by talking about this business problem."
• "Competitor Y is particularly strong in that market, that prospect looks tough to bring over the line."

This often leads to a conversation about sales qualification in general. Here's a mnemonic called SCOTSMAN from salesplusprofit.com: