everything you wanted to know-product management (29)

8/8/2019 Everything You Wanted to Know-Product Management (29)

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Everything You Wanted to Know about Product ManagementEverything You Wanted to Know about Product Management

((but were afraid to ask!)but were afraid to ask!)




Why you should be here today

Product management is the most common role that Kellogg marketing majors willfind themselves in, on their first job. Despite this:

– There is a lot of ambiguity about the roles and responsibilities of productmanagers in the industry.

– Kellogg currently has no course on product management, so students really

don’t know what to expect.

To plug these gaps, I have been working on a research project aimed at identifyingbest practices in product management.

– We have conducted depth interviews with 25 product managers in a widerange of companies.

– We have also surveyed 200 product managers to identify the drivers of high-performance product management.

The purpose of my talk is to share what I have learned in this project, so that youcan be better prepared for product management careers.




Agenda

What is product management?

– Definition of product management

– Differences in product management across business contexts

What do product managers do?

– Roles and responsibilities of product managers

– Product management activities across the product life cycle – Deliverables for product managers

– Important interfaces for product managers

What makes a good product manager?

– Knowledge domains for product managers

– Key skills and personality traits

What do high-performance product management organizations look like?

– Determinants of high performance product management organizations

– Most admired companies in product management




Defining product management

As a product manager, I have a responsibility to mycustomers (current and future) to release a productthat meets and exceeds their needs – even if they

are not fully aware of their needs. I also have afinancial responsibility to my company that theproduct will meet revenue and margin goals. Finally,I have a responsibility to my development team todefine a feature set that, if they can deliver it, will

meet the first two objectives.- John Miniati (Kellogg ’96)




Defining product management

A product manager is a middle manager, usually within the marketingorganization, responsible for successfully bringing new products (or services/brands) to market and ensuring the ongoing success of existingproducts over their lifecycle by orchestrating all functional areas thatimpact the development, manufacturing, sales, and support of products.

Key points – Responsible for orchestrating all product-related activities

– Should act as “general mangers” for their products

– Success requires art of influence without authority

– Roles and responsibilities are often ambiguous

– Need to be able to think across functional boundaries

– Business context and organizational culture impacts role definition,responsibilities and authority




Perspectives on the role of the

product manager

The Product Manager needs to know the customers, the market, and competitive featuresbetter than anyone else in the company. Individual developers may know specific areas better,but the Product Manager is the “go-to” person for the product.- HP

Above all, the Product Manager must understand the customer and the product. They, more

than anyone, must know the range of functionality for a particular product and be true experts.For example, how it works, what it does, how to do X or Y. They must continually ask questionssuch as, Is it “drop dead simple”? Intuitive? Easy to use? How are customers using it today?What are the issues or problems from the customer’s perspective?

- Intuit

In technology companies, developers are like oarsman in Viking longships – you don’t get veryfar without them. Moreover, they tend to be very creative, hard-working, and strong-willed.They WILL build a product without a product manager. My job is to make sure that the product

they build is the right product for the customers, because – more than money – developerswant to be part of the ‘next Palm’ or the ‘next Cisco router’. - Startup firm


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Related titles and job roles

Business Context Product Manager RoleCompany markets relatively complex and high-ticket priceproducts in technology or industrial markets. The productsrequire focused attention to be successful, and technology isa key driver of product success.

Product Manager

Dow, Cisco, 3M, Medtronic

Company markets a broad range of consumer packaged goods products under a few key brand names. Brands are

leveraged across several product categories, and there maybe multiple brands within a category.

Brand Manager Category Manager

P&G, Marriott, Pfizer, Toyota

Company sells a diverse array of products to a relativelysmall number of customer segments. Segments overlapsignificantly across products. Products need to be combinedinto customer solutions for each segment.

Market manager Segment manager

Fidelity, Thomson Financial, IBM

Company’s customer base is characterized by a few largecustomers, each with relatively specific customization,service and support needs, as well as a customized sellingapproach.

Key Account Manager

All enterprise marketers

New-product efforts are time-consuming and critical for thecompany, to the point where a special position is createdexclusively to handle new products.

Product Development Manager New Products Manager

HP, 3M



Agenda
















Two faces of product management

Voice of

The Customer

Capabilities of

the Company

Inbound

Product Development

Outbound

Product Marketing

Convert the value proposition

into a market offering

Take the offering and the

value message to market



Responsibilities of product managers

Inbound Responsibilities – Understand customer needs and requirements

– Understand the market and competition for the product

– Research feature enhancements and upgrades for future releases

– Create Marketing Requirements Document (MRD)

– Create the product release plan

– Help to develop product roadmap and competitive positioning

– Work with development, testing, and QA to ensure that product meets requirements andstays within schedule

Outbound Responsibilities

– Manage product launch

– Support marketing with outbound marketing communication and PR

– Support sales with product training, demos, customer presentations, data sheets, competitive

positioning – Support sales on key customer deals and accompany sales personnel on key customer visits

– Monitor and improve customer satisfaction



Responsibilities vary by context

Maturity of product-market

Co

mpa

nySi z

e

SMALL

LARGE

MATUREEMERGING

“Inbound/Strategic” • Inbound-heavy role

• Close interaction with engineering• Defining target markets• Generating customer wins• Broad authority and influence• Ability to think strategically

“Outbound/Tactical” • Outbound-heavy role• Understanding of product

• Understanding of vertical markets• Less authority and direct influence• Ability to manage interfaces• Ability to communicate internally

Market Maturity



What decisions do product

managers influence?Decision Product Manager Influence

(1-None, 10- Complete)

Defining Product Specifications 7.23

Managing Product Releases 6.96

Product Positioning 6.93

Product Upgrade Decisions 6.28

Managing Launch Events 6.44

Product Pricing 6.28

Product Packaging/SKU Decisions 6.31

Customer Segmentation 5.62

Consumer Promotions 5.48

Channel and Partner Promotions 5.15

Product Advertising 5.26

Channel Selection 4.78

Corporate Branding & Advertising 4.46



Deliverables for Product Managers

Responsibilities:• Market research

• Target market definition• Competitive analysis• Positioning• Market Requirements• Forecasts

Interfaces:• Customers• Research firms• Engineering• Finance• Sales

Responsibilities:• Refine market requirements

• Customer research• Trade-off schedule vs.features

Interfaces:• Engineering• Customers• Partners

Responsibilities:• Product introduction plan

• Customer demos• Refined forecasts• Sales training• Press kits• Trade shows• Events collateral• Promotion/Advertising• BOM/Inventory

Interfaces:• Customers• Sales• Analysts• Press• Engineering• Finance• Tech support

Responsibilities:• Sales training

• Customer promotions• Trade promotions• Product updates• Next version planning

Interfaces:• Customers• Engineering• Tech support• Sales• Partners

Product

Conception

Product

Development

Product

Launch

Product

Sustaining



Evaluation criteria for product managers

• Achieving product release milestones

• Meeting volume, share, and revenue goals

• Accuracy of sales forecasts

• Level of customer satisfaction

• Evaluation of cross-functional partners (internal)

• Speed of resolution of escalations

• Creativity and initiative



How are product managers

evaluated?

Evaluation Metric Yes No

Product Revenues 62.2% 37.8%

Product Profitability 61.5% 38.5%

Market Share 46.9% 53.1%

Customer Satisfaction 19.7% 80.3%



Agenda
















Knowledge domains for product

managers

Product

Knowledge

BusinessKnowledge

Process

Knowledge

• “What it does”• “What it needs to do”• Product functionality• Product roadmap• Product architecture• Core technology• Product bugs/gaps

• Product usability• Complementary products• Competing products

• Who - Customer segments• Why - Customer needs• Where – End-use scenarios• How often – Usage levels• Why not – Usage barriers• Who else – Customer DMU• How – Customer DMP

• Purchase drivers• Upgrade drivers• Installation experience• Usage experience• Customization experience• Support experience• Upgrade experience• Partner/VAR experience• Unmet needs• Known product problems• Known service problems• Brand/company image• Customer satisfaction

Market

Knowledge

• Key demand trends (by segment)• Key technology trends• Key alliances/partnerships• Competitive products• Competitors’ motivations• Potential competitors• Strengths/weaknesses (company)

• Strengths/weaknesses (product)• Strengths/weaknesses (partners)• Strengths/weaknesses (brand)

• Company values•

Company vision/strategy• Company image/brand• Vision of the business• Goals of the business

• Customer insight process• MRD development process• Product planning process• Budgeting process• Product development process• Product testing process

• Product launch process• Partner management process

Customer

Knowledge



What product managers need to

know – importance ratings

Knowledge Domain Importance(10 point scale)

Customer knowledge 8.81

Product knowledge 8.65

Competitor knowledge 8.21

Company business knowledge 8.00

Macro environmental knowledge 7.61



Competencies for product managers

• Ability to think strategically about the product by understanding how the product fits into the company’sbusiness

• Ability to clearly define and communicate the vision, goals, and value proposition of the product from thecustomer perspective

• Ability to understand customer requirements, and to map customer requirements into productspecifications and features

• Ability to understand technology broadly (architectural knowledge) as well as deeply (inner workings) todialog effectively with developers

• Ability to evaluate cost/quality/time-to-market trade-offs and to make appropriate trade-off decisions under uncertainty

• Ability to effectively communicate with, tactfully collaborate with, and forcefully convince people in diversefunctional areas

• Ability to analyze data and trends to produce effective plans and accurate forecasts

• Ability to juggle competing demands on time and to prioritize activities



Personal skills for product managers

• Passion for the product

• Intellectual curiosity

• Communication skills

• Listening skills

• Negotiation skills

• Analytical skills

• Selling skills




Agenda

















Factors driving product management

performance

HR Practices

– Influence over development budget

– Degree of empowerment

– Clear career paths

– Clear evaluation metricsAuthority and Knowledge

– Extent of early involvement in product development

– Ownership over product specifications

– Level of Technical knowledge – Accountability for product quality

– Accountability for financial performance

– Viewed as General ManagersOrganization Design

– Presence of organizational silos

– Poor cross-functional coordination

– Short-term orientation

– Decentralized and autonomous SBUs

–Unclear role definition

Customer orientation

– Level of customer contact

– Quality of coordination with sales

– Knowledge of customer needs




Dependent variable – product

management performance

Dimensions of product management performance

– Ability to understand and anticipate customer needs

– Innovative products and technologies

– Quality of product marketing activities

– Overall quality of product management




Variable Coef. Std. Err. t P>|t|

HR Practices 0.2339 0.0732 3.20 0.002

Authority/Knowledge 0.1282 0.0629 2.04 0.043

Organization Structure Barriers -0.1285 0.0665 -1.93 0.055

Customer Orientation 0.1960 0.0683 2.87 0.005

Close Interface with Engg. 0.0739 0.0351 2.11 0.036

Quality of Planning Processes 0.1292 0.0495 2.61 0.010

Quality of Execution Processes 0.2757 0.0701 3.93 0.000

Clarity of Job Ladders 0.0996 0.0922 1.08 0.282

Number of Obs = 193

F( 8, 184) = 25.43Prob > F = 0.0000

R-squared = 0.5251

Adj R-squared = 0.5044

Root MSE = 1.1694

Regression model for product

management performance




The most admired companies in PM

Company Good atUnderstanding

Customer Needs

Has the MostInnovative Products

Does the best jobat Product

Marketing

Best Overall atProduct

Management

3M 8 6 3 5

Apple 3 8 9 2

Coca Cola 6 8 5

Dell - #5 8 6 10 7

GE - #4 14 8 7 5

General Motors 4 1 3 4

IBM 5 2 2 3

Microsoft – #1 20 18 15 12

Nike 1 3 5 4

Nokia 1 6 1 1

P&G - #2 10 2 13 18

Pepsi 4 7 6

Sony – #3 7 22 10 11

Toyota 4 2 3Source: Kellogg PM study




Summary

• Product managers should be the company’s voice to customersand the customers’ voice to the company

• Product managers need to master the “art of influence” as theyorchestrate all activities related to the product

• A good product manager should be the “go-to” person for her

product.• A good product manager should be able to communicate theproduct’s value proposition persuasively to internal and externalcustomers

• Effective product management requires clear definition of roles,empowerment, and solid execution processes.

• Kellogg MBAs are ideally positioned to become product managers,because of their team skills and their general managementorientation.



THANK YOU


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