Instead of a consultant’s usual response to things “it depends”, I will choose to give an enthusiastic affirmative – Absolutely YES! But before I give you my reasons for it, let me first give a context for this term Product Manager (PM).
For any product business that is trying to turn an idea into a successful enterprise the management team channels their energy essentially into two macro functions – building stuff and selling stuff. If engineering is primarily tasked with building and sales is tasked with selling somebody has to be focused for everything in between – that’s where the Product management role comes in!
Here are 5 basic reasons on why companies need somebody playing the role of a product manager
1. Bringing the Market Context into the Company
Successful companies build products that actually solve real problems. Somebody needs to identify the market problems through rigorous market research, qualify and quantify them and validate the proposed solution to ensure it indeed solves their problem and can be feasibly delivered to the customer. Product Managers ensure that we build products that ultimately people want to buy, they are the messengers of the market and represent the voice of the customer and prospects in all strategic decision making inside the company
2. Productizing Innovation
Engineering has come up with the most brilliant innovation – now how do you “productize” it? What segments of the market would this appeal to and would customers actually pay for it? What is the competitive landscape for the product and what alternatives available to that segment of the market? How should this be priced and packaged to turn it into a profitable business? What should be the primary route to market for such solutions? As you can see there is a lot more that happens between building and selling and somebody needs to be responsible for productizing innovation
3. Self Reference vs. Market Research
Companies, especially early stage, often fall into the trap of concluding what market needs by just talking to a few prospects/customers (usually friends!). The trap becomes even vicious when you find yourself doing custom work for each of those initial customers. If the business model is to focus on generating huge revenues from a few customers this model might work but for companies who want to be market driven, you want a champion that focuses on broader market research by talking to several customers and identifying a trend by normalizing one offs (even though they represent to be a very attractive customer opportunity)
4. Pricing, Packaging for Profitability
If the ultimate goal for the venture is to become profitable, this is probably one of the most important exercise that typically is owned by the Product Manager. While there are several methodologies to price a product and package it with others in the portfolio, they all revolve around a strong understanding of the buyer and user personas in the target market segment. Leavings this up to the builders (engineering) could be dangerous as they will be the experts on the cost side but not the value to the customers and leaving it up to the sellers (sales) to decide this is even more so dangerous as they would more focused on revenue and not profits! In the IT services sector where commoditization is in fashion, finding the next valued added feature/service in the packaged offering is even more so critical to continue to grow and differentiate the offering
5. Communicating Values Over Features
Product managers are the de-facto product experts which make them the perfect candidates for developing the positioning strategy for the product that sales and marketing can use to communicate values over features. Organizations typically have invested into marketing and communication functions like brand building, PR/AR (Press/Analyst Relationships) etc. to help sales but few in India actually have a more formal marketing department with dedicated Product Marketing Managers (PMM) to help with sales/SE training, generating leads, customer retention and acquisition, thought leadership activities, launch plans etc. Essentially helping the sales team to effectively sell with the right message that resonates with the customer becomes a function of the product management role in those scenarios.
Some companies have distributed these functions with different roles like VP Engineering, CTO, VP Sales, VP Marketing etc. and often the CEO is the PM of the company. Not only are there inherent risks in such fragmented execution, this model doesn’t really scale in the long run.
Different Names for the Same End Game
Due to the versatility and the nature of the role for a Product Manager, different organizations globally have called this role differently. Titles like product manager (PM), program manager (PrM), product line manager (PLM), product marketing manager (PMM), Technical Product Manager (TPM), business analyst. Also due to the strategic nature of the role coupled with a lot of decision making, the Product Manager role is often found to be residing in different organizations – reporting into engineering, sales, marketing and often directly into the CEO.
Product management function in India is still in its infancy. Lot of MNCs have started hiring product managers in India to improve operational efficiency by tightly aligning a PM who decides on “what to build” with the engineering team actually building it. Lot of services companies and startups might not have a dedicated Product Manager but the role is split between different members of the management team.
I wonder that, as India Inc gets ready to build more products for the global markets and as global companies get ready to see India more than an engineering center, do we need more Product managers in the industry than what we have today?
We would love to hear from you. Do respond with your ideas and queries in the comments below.