(B) The daily life of a high-tech product manager is always changing. The product manager needs to prioritize his or her time according to the key product challenges and priorities whether they are business or technology driven. During a product launch, he or she might spend more time on the product outbound. During a release definition, he or she might spend more time on the product inbound. As the owner of all strategic, internal and external activities that are part of the Product Life Cycle (PLC), the product manager always needs to multitask between those tasks every day. And, no days are similar.
The Product Life Cycle
The product life cycle defines key milestones over the life of a product from the initial concepts on the “white board” to the launch of the first release/version 1.0 followed by additional releases until the product ends its life in the marketplace. The product manager is in charge of all product strategic, inbound and outbound activities that are part of the PLC. In a large organization where product revenues are significant, the inbound function is typically called product management whereas the outbound function is called product marketing. In that case, those two types of activities are generally held by two different individuals or even two different groups depending on the size of the product line. In a start-up, those two functions are owned by the same individual who sometimes, in addition, is responsible for the program/project aspect of the product which requires coordinating the involvement of the various stakeholders contributing to the development, manufacturing, marketing and sales of the product.
The “Strategic Side” of Product Management
The strategic side of product management includes the key product activities that are required to formulate the start or the growth of a company:
Competitive Strategy: A good product manager understands well the capabilities of his or her organization, the market dynamics and the competitive environment for the company products. Because of that “sweet spot” in which they are, good product managers are the first to realize if an existing company strategy is working or not and more importantly what should be changed to it in order to achieve better market success.
Business Plan: Company and product business plans complement each other. Usually, the product business plan expands with more depth the company business plan. The product manager is in charge of the product business plan while the CEO is in charge of the company business plan. A good business plan is about risk management. Risks in technology/development, market/customers, organizational/company and financial/funding. A good business plan must provide ways to hedge those risks.
Market Opportunities: Market opportunities to grow a company must be investigated beyond the existing target segment such as new horizontal, vertical or geographical segment. Those opportunities might involve some new company investments through the development of new core competencies and/or merger and acquisitions (M&A).
Product Portfolio: To grow, every company needs to expand from one product to a product line and from one product line to multiple ones. The product manager must take an on-going leadership role in contributing to how his or her company should develop and market a complete product portfolio.
The “Inbound Side” of Product Management
The inbound side of product management includes the tactical internal activities required to develop and manufacture the product:
Market Requirements (MRD): The MRD captures all on-going primary and secondary market research activities in a particular market and competitive trends and articulates the future opportunities for the product. Primary research involves customer interviews, focus groups, product tests and RFI/RFP (Request for Information/Proposal) while secondary research involves digging into information from the Internet and conferences.
Product Requirements (PRD): The PRD is probably the most difficult task for any product manager. The PRD must specify the requirements for the product in order for any development and manufacturing group to design and manufacture the product. Ideally, the PRD must propose the product functions, features, and applications without implying specific product implementation scenarios that could limit the creativity of the product designers (unless specific implementations are required by the market). A good PRD defines a problem (product use cases) and not a solution (product design) and could be given to any organization outside the company that has the adequate core competencies for the product development and manufacturing.
Product Road Map: A road map generally defines the product evolution over 3 to 5 years with significant details for the next 18 months. The road map must support the company vision and mission.
Product Releases: Releases must be scheduled over a given period, on average every 6 months for a software product and 18 months for a hardware product. During that period, the development organization must design the new product features. Releases must be defined in the PRD and must be documented with any product bugs and/or specific applications.
Beta Programs: Beta programs are required first for real field and customer product testing but second also for large-scale product deployments and product interoperability testing.
Product Pricing/Margin: Product financials should include the product list price, product discounts, gross margins, manufacturing costs.
Product Forecasts: The product forecasts can be derived from the product business plan (top-to-down approach from market size and company shares) and internal sales forecast (down-to-top approach from customer leads and number of sales representatives). It must be reviewed by the product manufacturing and financial organization.
The “Outbound Side” of Product Management
The outbound side of product management includes the tactical external activities required to market and sell the product:
Marketing Plan: The marketing plan includes all elements to market the product and its marketing mix or 4Ps (Product, Positioning, Place/Distribution, Promotion) as classically defined in consumer marketing.
Product Positioning: There are many ways to position a product: features, functions, applications, market segments, distribution channels, pricing, customer support…and all those can be combined.
Competitive Analysis: A product manager must always be anticipating and reacting to any of its competitor moves. For the long-term, competitive behaviors must be analyzed to assess the market opportunities and to develop the product road map. For the short term, competitive moves must trigger tactical market responses.
Product Launch: A product launch is an important milestone for any company. Product launch involves a fair amount of preliminary preparation and dialogue with the press, analysts and major customers. For a public company, a successful launch should be measured by its impact on the company stock price. For a start-up, a successful product launch shall attract the attention of the market incumbents.
Product Evangelism: Evangelism is an important task for the product manager for a new type of product which might require some level of customer education. Product evangelism is generally a must in a “push market” (that is markets where demand must be generated versus “pull markets” where demand already exists).
Demand Creation: Depending on the type of product, that task might include product advertising, public relation and lead generation. Demand creation is important until the product is a brand or to adapt the brand to on-going market and customer changes.
Partnerships: As Theodore Levitt defines it in one of the first marketing books “The Marketing Imagination”, every product has a generic form, an expected one, an augmented one and a potential one! The role of partners is to generate added value to the product generic form in order to create a business ecosystem around the product.
Sales and Channel Support: This is when the rubber meets the road and when the product manager must drive all the tactical tools such as product presentations, demo, case studies, required by the sales and channel organization.
A product manager is successful if his or her company relies on him or her to own the process of driving products from development to sales. The successful ownership of that process can only be measured over a full product lifecycle from starting the product development to the product launch and from the launch of the product to its market penetration.
Note: Many people in the past have asked me about what product managers do. I hope that this article will provide some hints.
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Categories: Product Management