What is “product management”, and why would a company need it?
First, let me start by creating differentiation between Product Management: the job title and product management: the business function.
Product Management, with the capital P and M, is a popular job title in the software, technology and Internet market. When you see the title of Product Manager, Director or VP of Product Management or even Technical Product Manager, the person most likely works for a technology or technology-enabled company. These are the people responsible for defining the product and providing the requirements for its development. In these companies, Product Management provides focus for developers and the organization to ensure all efforts support delivering a solution that fits the customers’ needs to ultimately generate revenue.
Product management as a function is the discipline a company applies which ensures every product created is based on the principle that its purpose is to fit a market and improve a customer experience. Not unlike the Product Management title, the objective is to improve a customers experience by meeting their needs.
Here is where the irony comes into play. Most non-technology businesses do not apply product management as a discipline to ensure the best solutions for their customers. Reference to non-technology companies is any business that has something to sell. They build products, may even have research to guide the creation of such product, but often they spend less time understanding the end customer to guarantee the final product reflects their expectations. Let’s use two examples that most people, at some point, have interacted with.
A restaurant sells a combination of food, service, and atmosphere, which together create the product. This product’s primary purpose is to satisfy a customer who desires a type of dining experience without his or her own required labor. How many restaurants in your community have come and gone? Is this the result of a shift of people eating at home or a business owner not understanding the needs of his or her target customer (e.g. not applying product management)?
How about the electrician whose job it is to fix an issue or install something new? The work they are hired to do is one part of the total product. Their response time, the way they engage you to understand the issue and their presentation all reflect their product. Have you ever hired a contractor who tracked dirt through your home? That becomes a reflection of their product. The contractor who places boot covers on their feet before entering your home is saying to you that beyond the service you need, their product includes respect for how important your home is to you.
So if we are going to start doing the business activity/role of product management, where do you start?
How about we heed the advice of management guru Peter Drucker who said, “know and understand your customers so well, your product fits them and sells itself.”
Successful products are those products that target the right customers (market segmentation), solving their problem/need with the right experience for them. The best way to continually do this is to always be talking to your current, past and potential customers. In these discussions, focus on listening, understand their problems and needs, understand the experience they are looking for, and start translating this knowledge across all of your customers into products that “fit them.” If you do this right, your product(s) will sell themselves. It doesn’t matter if you’re starting a restaurant adding a new item to your line or building a service to address an untapped area of the market, you must first understand what the customer needs in order for your product to be accepted.
The takeaway? No matter what your business does, you sell a product (or products) that consist of solving your customers’ problems/needs and the experience you provide as you solve their problems. Since these products are where your revenue (and in turn business) comes from, shouldn’t someone be managing your product(s)? I would say yes.