High Impact Product Management: Creating and Measuring Product Management Success
There are many different ways companies structure and approach Product Management (PM). Particularly in firms where a certain PM maturity level hasn't yet been reached, PM Professionals can struggle with how to do their job in the most effective way. It doesn't help that sometimes Management and other groups don't necessarily understand what PM means, what aspects it must cover, and how it should function within the company. Overlaps and inconsistencies in authority and responsibilities can also create additional hurdles and challenges. For this and other reasons it is important for PM professionals and newcomers to think hard about the impact and influence they plan to have on company success and how to gain respect within the company. This article is a discussion about how to measure the impact of PM, about the need to be pro-active, and about key elements and considerations for successful PM programs.
1. The Importance of Measurable Success
High-Impact PM is PM with the objective to stay as close as possible to the business reasons and objectives for Product Management as a professional discipline. These objectives relate to clearly measurable results (see Primary Measurements in table below). More so than 'soft? MBO-type goals (see Secondary Measurements in the table below) business results-oriented goals will always receive higher consideration by Senior Management for measuring the ultimate success of PM. PM goals such as planning documents and analysis projects and delivery dates being met are also vital and should not be under-estimated, but they can be less important as a true measurements of success. On their own they will say little about the ultimate success of Product Management.
Table 1: Measuring Product Management Effectiveness and Success
Factors contributing to Success
Increase customer wins
|Target Market Analysis/Planning Target Market Sales Support Competitive Product/Solution/Pricing Reference Customers||Number, frequency, and size of wins Market share Financial Trend Analysis|
Increase customer satisfaction and loyalty
|Competitive solution Quality of solution Quality of Support Services Pricing||Customer Satisfaction Survey Customers willing to act as reference Low customer attrition rate Trend Analysis|
Product and product-line profitability
|Pricing Measured product investments Sunset unprofitable solutions||Product P&L Financial Trend Analysis|
Cost-effectiveness of the support organization
|Effective Product Support and Training Materials||Cost of Sales Cost of goods sold Financial Trend Analysis|
Product Mgmt Activities and Deliverables
|Factors contributing to Success||Success Measurements|
Product/Market Planning and other Planning Documents
|Product Planning Business Opportunity Analysis Product Marketing Requirements||Availability and quality of materials (Note: it may prove difficult to measure ultimate success of such materials)|
Manage execution towards deadlines being met
|Status Monitoring Facilitate inter-Team Communication Escalation||Deadlines being met (Note: it may prove difficult to measure the quality aspects of the deliverables)|
Launch and Support related Documents
|Sales Support Materials Marketing Materials Staff Training||Availability and quality of materials (Note: it may prove difficult to measure ultimate success of such materials)|
PM should frequently be asking itself the question if what it does instrumentally impacts the business results shown in the table above. If it doesn't, it could be time to change or improve the PM approach.
2. PM Productivity: Reactive vs. Pro-active Product Management
Unless you work for or with other Product Management professionals who have already set many of the engagement and process ground rules for 'good and effective' Product Management within the company, chances are that you will be expected to help take care of the various 'crises of the day'. If you are not careful, you can quickly inherit some of the biggest reactive challenges of the company. These challenges usually exist due to some the following reasons:
- Lack of process and methodology, resulting in bad or wrong expectations (deadlines, estimates, market needs etc.)
- Lack of process and methodology, resulting in poor product quality and delays
- Lack of planning, resulting in lack of business or market focus
- Lack of planning, resulting in lack of foresight and strategy
- Lack of communication (verbal or written), resulting in internal and/or external confusion or frustration
- Lack of communication, resulting in inability of company staff to execute on their job
- Lack of organizational clarity of responsibilities and authority
You'll not likely be able to change these issues overnight or on your own. There is no sense running around like a chicken with the proverbial head cut off and having no fun at your job. The main thing you need to do is to make sure that you first bring your PM piece of the organization under control with your experience, professionalism, and process/methodologies and that you start discussing with others what you expect from their organizations. It is likely that you must initiate changing the rules of the game. This is done by beginning to think and act along the following lines:
- Reactive Product Management isn't a good way to continue and isn't the best interest of your company. The word Management does after all imply a solid degree of pro-active actions and planning to be present at all times.
- You can't carry all the problems on the company on your own shoulders. Not just isn't it fair to yourself but it isn't fair to everyone else who can and should be expected to step up to the plate and contribute just as much to the success of the company as you do.
- How much do your actions and the company's collective actions truly maximize the company's progress along the four business results objectives listed earlier in Table 1. The answer may be not enough. You and your company deserve better and must collectively make some changes to get back on the right track.
Effective Product Management to a large degree is about being pro-active most of the time and about facilitating positive change in the organization: changes in processes, changes in attitudes, changes in responsibilities, changes in cooperation between teams, changes in how customers/target markets are defined and viewed, changes in what products and services the company sells (or not!), and more.
No matter how senior or junior your PM position is, you are at least in part responsible for making and facilitating these changes, whether you have the authority or not. If nothing else, it is your professional Product Management responsibility! If you don't want to go down that path, you might consider applying for an Analyst, Customer Support, or perhaps a Sales Support position--they require little of these skills. In twenty years of Product Management in several firms I haven't found a company yet which couldn't benefit from a little (or a lot!) of positive change.
3. Pro-active Product Management Initiatives and Activities
You might be only one person fighting the Product Management battle or perhaps you are part of a larger team. In any case, time and energy must be maximized and focused on the correct set of pro-active efforts and initiatives. The priority and emphasis of these initiatives can be different in each company (based on existing strengths and weaknesses). Based on my experience the list will however almost always include most of the following items:
1. Understand your PM roles and responsibilities. Understand your PM roles and responsibilities (job descriptions are helpful). Make also sure you understand the roles and responsibilities of the people you work with (Development, QA, Marketing, etc.). This will get you at least the correct set of company and management expectations--even if you may not always agree with them. Also refer to the article Role of Product Management by Pragmatic Institute's Steve Johnson.
2. Understand your Goals and MBO's. Understand your annual personal and group goals and those of the people you work with and for. Chances are that you may get paid a bonus for meeting your goals so it does pay to pay attention to this. Your goals likely include standard PM goals such as product revenue and profitability goals as well as meeting key project/product dates. If the company doesn't do it for you, be sure to establish a set of your own pro-active PM goals related to key Product Management initiatives (as listed in this table) to help you accomplish your job.
3. Understand the elements of Product Management--and who does what in your company. New Product Managers may not always have hands-on experience with all aspects of Product Management, ranging from Market Analysis through Product Planning to Channel Support (also see chart in article ' The Product Management Triad' in June 2003 edition of productmarketing.com). The company possibly expects you to focus only on limited aspects of Product Management (for example Product Definition, Release Management). It will be to your advantage to look at the bigger picture! You must understand how many of the Product Management elements are ?under control? and how many are not. You also need to know how many of the non-PM components (R&D, QA, Implementation) are under control or not. You can for example do the world's best Product Definitions and the Product and Business situation can get out of control if for example Market Analysis hasn't been properly done, if QA lacks, or if the Launch is ineffective. Take ownership, even if you don't have the title. Ask tough questions and get involved even in issues that might be considered by some as none of your business!
4. Effective Time Management. Don't become a victim of reactive Product Management! It is easy for Product Management to make a full-time job of doing nothing else but email and meetings.--Don't respond to every email you get, avoid jumping on email chains--Don't attend every one of the many meetings you are invited to--Don't support all Sales calls you will be invited to--Don't participate in all crisis meetings you will be invited to. Chances are high that it won't do yourself and the company any good if you get dragged into everything. Be selective in how you spend your time! Spend more time thinking about your goals and objectives and how they relate to the business objectives. Gravitate to the aspects of the job that require your attention because they matter for the bottom line. Keep in mind that Product Management greatly benefits from highly leveraged activities. Good examples are Sales Guides, Demo Narratives, Training Videos, (Product Lifecycle) Process Standards and Guidelines, defect and enhancement tracking databases, RFP response databases, Status and Progress Reports and so forth. Such activities go a long way!
5. Effective Internal Communication. Product Management's job is to frequently and effectively communicate with virtually all parts of the company: Product Development, QA, Sales, Sales Engineering, Customer Support, Implementation Support, Marketing and so forth. Always be courteous and professional to everyone--don't make enemies--and find out what makes people tick. Share information such as Status reports and be sure to ask for the same courtesy in return. Effective Product Management needs all the allies it can get, all the data it can get, and needs to know where any potential non-supporters and obstacles might be hidden.
6. Effective External Communication. Talk a lot to your customers and your prospects--find any excuse to do so! You will learn a lot about their expectations, buying reasons and behavior, and perhaps even a bit about your competition. User Groups and conferences are terrific places to be. Straighten out your Management if they tell you that you don't really need to attend, you do. Also talk to your competitors, talk to analysts, talk to reporters, talk to the firm's executives, and talk to just about anyone who might give you additional insights and perspectives. Also refer to the article I Am Customer, Hear Me Roar by Les Jickling in PM.Com June 2003.
7. Effective Planning. Effective Planning is a key foundation for Product Management. Just as every company will do its annual budget plan, PM must create a Product Plan at least once a year. Be sure that it specifies your target markets and how the revenue/budget goals relate to new and existing products. Be sure to explicitly point out key Revenue, Expense and Profitability dependencies. Explain the competitive standing of your products and indicate how proper positioning and effective marketing activities can help. The other critical thing is Product Release Planning. Every Software Product Manager should always have a current Product Release Roadmap in the top drawer, available at an instant. Other Planning activities of course include Market Analysis, Gap Analysis, Sales win/loss Analysis, and more. Plans should be in place related to all major components of product income and expense and any time a significant product milestone event is at stake.
8. Effective Processes. Many experienced Product Management Professionals gravitate to the development and/or refinement of new or improved Business and Product Lifecycle Processes and will spend a lot of energy and focus on this area. This can make great business sense because these processes can be highly leveraged throughout the company and will make everyone's lives easier and more predictable. For such processes to succeed they must be a) easy and almost intuitive to understand and follow and b) they must be fully endorsed/supported by the highest levels of Management so that people can't conveniently ignore them.
On a high level, the most important processes for Product Management include:
- Creation, distribution and approval of key documents: Business Plan, Product Plan, MRD, Specification, Test Plans, Market Launch Plan etc.
- Process for multi-departmental sign-offs and Milestone events and go-aheads
- Guidelines for Meetings, Status Reports, and internal and external communication
- Standards for tracking key data (contract commitments, enhancements, defects etc.)
- Process for Escalation, Change Management etc.
9. Metrics. Track as many of the success metrics as possible as they are defined in Table 1. You should understand how well you are really doing because it will help you adjust your approach and make more effective presentations to Executive Management. Making a case based on money and bottom-line results is always an appealing and effective approach!
10. Learning. You are the expert for your markets and for Product Management activities and methodologies. You can't afford to stop learning. Learning efforts include vertical market information, Product Management disciplines and methodologies, and general Business Planning and Business Management techniques. Perhaps this is one of the reasons why Product Management never becomes dull and boring for Product Management professionals. Read books and magazines, go to seminars, trade shows, talk to people.
4. High Impact Product Management is more fun!
Practicing High Impact Product Management is neither a difficult nor a new concept. Put your best Product Management hat on, pretend (at least to yourself) that you are running the company, and focus on those tasks, actions, and initiatives that are most important and make the biggest difference between success and failure of the products (and the company).
Be sure to draw many of your co-workers into your circle of people who try to make the products and the company better. Emphasize pride of ownership and professionalism, lead by good example! Set an example by being pro-active and smart in your workday. Perhaps even occasionally make a point and demonstrate a bit of pity and/or lack of tolerance for those people who don't share your passion for results and seem to just do their nine-to-five job? Product Management, perhaps more than any other group in the company, is critical for the future and the success of the company. You owe it to yourself, your co-workers, your customers, and your shareholders to do the best job you possibly can.
Want more information on how to make your product management team successful? Attend a Pragmatic Institute course today.
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