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Why Product Management Matters


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What separates best–in–class companies from other companies? It is usually the manner in which they provide high value products and unique experiences to customers in carefully chosen markets. Product Management encompasses a set of business practices which, when viewed holistically, helps the firm achieve its goals for product profitability and market share. Product Management is, in a nutshell, the business management of products, represented by how firms create, develop, and manage products and services across their life cycles.

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Why Product Management Matters

  1. 1. ® Why Product Management Matters Presented by: Steven Haines President, Sequent Learning Networks Founder, The Product Management Executive Board Author, The Product Manager’s Desk Reference Author, Managing Product Management Author: The Product Manager’s Survival Guide © Copyright Sequent Learning Networks
  2. 2. Sequent Learning Networks Our mission: To elevate the skills and capabilities of product managers and marketers To help executives improve the effectiveness of their PM organizations Our clients: More than 10,000 alumni 100’s of organizational diagnostic projects 1000’s of product manager assessments International clientele, multiple industries Our People: Steven Haines, founder and author A team of former corporate leaders with the depth and breadth of experience to guide organizations on their Product Management journey Contact: +1.212.647.9100 2 © Copyright Sequent Learning Networks ®
  3. 3. Demonstrated thought leadership The “body of knowledge” for Product Management The comprehensive guide to creating and managing profitable products and services across the entire life cycle Invaluable resource for senior leaders to effectively organize and manage Product Management Comprehensive approach to govern and sustain Product Management for the long-term 3 © Copyright Sequent Learning Networks ®
  4. 4. Coming soon! The Product Manager’s Survival Guide • The first and only “how-to-get-started” in Product Management! – For people who want to be a PM – For product managers who want to re-boot their career – For newly promoted managers of Product Management – For new Product Management leaders Steven Haines 4 © Copyright Sequent Learning Networks ®
  5. 5. Resources for product people Templates Newsletters PM Public Blog (PMEX) PM Life Cycle Model 5 © Copyright Sequent Learning Networks ®
  6. 6. Main points for this program • Share the Current State of Product Management • Define the Role of Product Management in the Firm • Portray the Main Players: The Product Managers and the Cross-Functional Product Team • Describe How Product Managers and Their Teams Do What They Need to Do • How to Leverage the Most Effective Reference Model for Product Management • Define What’s Needed from Executives • Explain Why Product Management Matters 6 © Copyright Sequent Learning Networks ®
  7. 7. 1 Product Management refers to the business management products 7 © Copyright Sequent Learning Networks ®
  8. 8. With such an easy to understand definition, what’s the problem? 8 © Copyright Sequent Learning Networks ®
  9. 9. Research findings • • Company structures often favor “Sales” to make deals or “Engineering” because they make the technology • Product Management is treated like project management • 9 The role of Product Management is misunderstood by leaders of other business functions Executives expect a steady stream of innovations when resources are short and insights are rare © Copyright Sequent Learning Networks ®
  10. 10. Additional findings • Product Management is in varying states of maturity – all over • New “administrations” try to remake PM as they search for the best way to make PM work • High levels of variation in PM practices = inefficiency The New Head of Product Management • In some companies, PM as a “function” ebbs and flows – like the business cycle 10 © Copyright Sequent Learning Networks ®
  11. 11. 2 It’s time to stop reinventing the wheel! Here’s how. . . 11 © Copyright Sequent Learning Networks ®
  12. 12. The role of Product Management in the firm • Product Management is a vital element of the organization’s business model and part of the organization’s DNA Product Life Cycle Management Plan Develop Launch Growth Maturity Decline New Product Development • Best-in-class PM is achieved by a commitment to the efficient management of products and portfolios, holistically, across their life cycles Post-Launch Prod Mgt Page 12 © Copyright Sequent Learning Networks ®
  13. 13. Product Management Customer Service Supply Chain Development Operations Sales Marketing A “horizontal” integrative function Product Management Source: “Managing Product Management” by Steven Haines 13 © Copyright Sequent Learning Networks ®
  14. 14. 3 The main players? Page 14 © Copyright Sequent Learning Networks ®
  15. 15. The product manager • A person appointed to be a proactive, product or product line “mini-business” owner • Leader of cross-functional product team • Team’s mission: Optimize product’s market position & financial return across its life cycle – consistent with Corporate and Division strategies 15 © Copyright Sequent Learning Networks ®
  16. 16. The Accidental Profession Everyone comes from somewhere else! Where they come from What they bring with them How they perform Impact on the business Marketing Sales Development Manufacturing • Knowledge • • • • • • Skills Experiences Documents Processes Beliefs Paradigms Inconsistent understanding and use of practices Skills not transportable across the business Documents that are not the same across teams or business divisions Other 16 © Copyright Sequent Learning Networks • Process/role confusion • Poor team behavior • Underperforming products • Focus on projects, not products • Misaligned product & market strategies • Lack of market focus • Less innovation • Poor decision making ®
  17. 17. 4 If PMs are supposed to play such a leadership role, and they’re all different, why is that so, and what can we do about it? 17 © Copyright Sequent Learning Networks ®
  18. 18. 5 We have to understand how product managers learn their jobs. 18 © Copyright Sequent Learning Networks ®
  19. 19. The product manager mind map You can’t make an appointment with experience! Customer Research Acquire Knowledge, Skills, and Experience Industry Analysis Competitor Research Forecasting Pricing Financial Planning & Analysis Make vs.Buy vs. Partner Analysis Channel Planning Competitive Product Research 19 Promotional planning Product planning Launching Products © Copyright Sequent Learning Networks Win-Loss Analysis Working with and Training Sales PostLaunch Audits ®
  20. 20. 6 We need to examine how product managers assimilate to produce positive business outcomes. 20 © Copyright Sequent Learning Networks ®
  21. 21. Customer Research Acquire Knowledge, Skills, and Experience Promotional planning Product planning Industry Analysis Produce High Quality Documents (Consistently) Deliver Results Product Strategy Profitable Products Working with and Training Sales Launching Products Segmenting Markets Strategizing Win-Loss Analysis Make vs.Buy vs. Partner Analysis Channel Planning Competitive Product Research Utilize Critical Thinking, Synthesizing, and Facilitative Skills Financial Planning & Analysis Forecasting Competitor Research Deriving Market Insights Pricing Creating Value Propositions Positioning Products Managing Projects Decision Making Prioritizing Business Case Post-Launch Audits Product Roadmap Satisfied Customers © Copyright Sequent Learning Networks Managing Risk Communicating Product Reqt’s Market Share Launch Plan Optimizing Performance & Results Leading & Influencing Marketing Plan Fulfill KPIs
  22. 22. What it takes • • • • • • • • • • Business acumen – how the business ‘works’ Get work done in complex organizations Influence people who work in other functions Build shared sense of purpose among team members Passion, commitment & determination Market awareness and sensitivity Solve problems Know the numbers Adaptability & flexibility Make decisions For the PM to influence others and assume product (team) leadership, he or she must earn credibility through actions 22 © Copyright Sequent Learning Networks ®
  23. 23. Capturing work: The Product Master Plan A long-lived, ongoing plan of record for the product or product line • Product Descriptions • Functional Support Plans and Cross-Functional Team Members • Project Plans • Sales & Distribution Plans • Promotional Plans • Pricing Strategies • Gate Reviews • Product Retirement Information • Product Related Documents: Strategic Plans PRDs Marketing Plans – Customers, segments, industry trends, competitive product comparisons, competitor information • Successes & Failures, wins & losses Business Cases Product Road Maps • All Relevant Artifacts and Product History • Product Performance Information (Financials, KPIs, History, Trends) • Market Research Data Launch Plans From: : “The Product Manager’s Desk Reference” 23 © Copyright Sequent Learning Networks ®
  24. 24. 7 Product managers need to integrate, leverage, and synchronize… they cannot do it on their own. 24 © Copyright Sequent Learning Networks ®
  25. 25. The product team Marketing Sales Product Development Finance Product Manager Supply Chain Customer Service Operations 25 Regulatory or Legal © Copyright Sequent Learning Networks ®
  26. 26. Cross-functional teams Two categories, different purposes Cross-functional product teams are market focused – “Board of Directors” for a product • Own the P&L/accountable for product performance • Strategic orientation Cross-functional project teams focus on product-related projects – Conducting a customer field research project – Launching a product – Making an operational improvement to support a product’s business 26 © Copyright Sequent Learning Networks ®
  27. 27. 27 © Copyright Sequent Learning Networks ®
  28. 28. Behavioral and cultural challenges Even in the best-performing companies Process interpretation or, poor or nonexistent processes Lack of commitment & accountability Don’t align on objectives or priorities People don’t Communicate (e.g. Risks) Lack of trust Over-Committing Under-Delivering © Copyright Sequent Learning Networks People don’t confront, e.g. culture of “nice” ®
  29. 29. Foundations of successful teams Focus on achieving results Hold one another accountable Commit to decisions, plans, and actions Engage in healthy conflict Trust one another Five Dysfunctions of a Team, Patrick Lencioni 29 © Copyright Sequent Learning Networks ®
  30. 30. Other contributors to team success • Commitment and buy-in to objectives and deliverables • Use metrics that shape performance and guide activities and crossfunctional engagement • Abide by rules of behavior – Attend meetings (on time) – Communicate risks 30 © Copyright Sequent Learning Networks ®
  31. 31. Cross-functional engagement Across the life cycle Function Planning Phases Developing Products Launching Products Managing Products (G – M – D) Product Manager Marketing Development Sales Operations Finance Customer Svce Supp Chain 31 © Copyright Sequent Learning Networks ®
  32. 32. Re-cap Product Management refers to the business management of products The role of the product manager How product managers learn and work, and provide positive outcomes for the business The importance of the cross-functional product team 32 © Copyright Sequent Learning Networks ®
  33. 33. 8 Product managers depend on proven business practices and a usable, relevant reference model. 33 © Copyright Sequent Learning Networks ®
  34. 34. The Product Management Life Cycle Model Areas of Work Phase-Gate NPD Process 34 © Copyright Sequent Learning Networks ®
  35. 35. The PM LC Model offers a framework To carry out work and produce the proper documents © Copyright Sequent Learning Networks ®
  36. 36. Product Management Life Cycle Model A holistic model to manage products, services, and portfolios across their life cycles Discovery and Innovation Market Insight Strategy New Product Planning New Product Introduction Development Concept Feasibility Definition Post-Launch Product Management Performance Management Growth-Maturity-Decline = Decision Check Point = Major Decision Point DISCOVERY and INNOVATION Develop Market Insight Segment Markets Define Customer Targets Assess Customer Needs Create Customer Personas Detect Industry Trends (PRESTO) Evaluate Competitors Compare Competitor Products Formulate Strategy Establish Strategic Baseline Configure Product SWOT Determine Life Cycle State Uncover Opportunities Integrate Product Roadmap Align Cross-Functional Teams NEW PRODUCT PLANNING Prioritize Opportunities Produce Opportunity Statement Shape Value Proposition Assert Competitive Positioning Build Prototypes Develop Business Case Derive Forecasts Compose Product Requirements Prepare Launch Plan Define Marketing Mix Model Establish Future Metrics Conduct Make v. Buy Analysis Construct Product Master Plan NEW PRODUCT INTRODUCTION Oversee Development Manage Scope & Trade-Offs Manage Projects Secure Regulatory Approvals Catalyze Ecosystem Synchronize Operations Orchestrate Product Launch Prime Channels Publish Marketing Material Conduct Sales Training Prepare Service Organization Announce Product Conduct Analyst Meetings © Sequent Learning Networks POST-LAUNCH PRODUCT MANAGEMENT Conduct Post-Launch Audits Track Customer Satisfaction Leverage Cross-Functional Team Reassess Industry Movement Reevaluate Competitor Actions Conduct Win-Loss Studies Evaluate Metrics and KPIs Analyze Product Profit & Loss Refine Value Based Pricing Improve Promotional Programs Gauge Channel Performance Rationalize Portfolios Discontinue Products
  37. 37. Get the model! 37 © Copyright Sequent Learning Networks ®
  38. 38. Foundations of the PM Life Cycle Model Plan Act Do Check The Deming Cycle • Plan – design a path forward • Do – implement the plan (execute) • Check – evaluate and measure performance against the plan • Act – Make changes and improve © Copyright Sequent Learning Networks ®
  39. 39. Important points from Deming • • Encourage collaborative communication so that employees work in the organization’s interest • Break down internal barriers – department’s in an organization are “internal Clients” to each other and must work together • 39 Commitment to continuous improvement to reduce variation Everyone is responsible for continual improvement in quality and productivity – particularly top management © Copyright Sequent Learning Networks ®
  40. 40. 9 How the model is used. 40 © Copyright Sequent Learning Networks ®
  41. 41. New Product Planning Concept: Rapid evaluation new concepts and ideas Feasibility: Deeper evaluation. Research, validation, Business Case, Launch Plan New Product Planning Concept Feasibility Definition Definition: More research, PRD, final BC, final Launch Plan and Marketing Mix model Decision Points 41 © Copyright Sequent Learning Networks ®
  42. 42. New Product Introduction Development: Launch: Execution work designed to fulfill product requirements Execution work designed to bring a targeted product or service to market Work activities include: • • Work activities include: Producing the product Managing scope, making trade-offs and prioritizing Meeting regulatory requirements Keeping the teams focused • 42 • Preparation of all launch materials • © Copyright Sequent Learning Networks Fulfilling all aspects of the launch plan Setting up all internal structures and operational systems to support the product during and after launch • • • The announcement and associated events and activities Internally and externally) ®
  43. 43. Phase-gate usage • To make optimal decisions about: – Moving a product project to a subsequent phase or killing the project – Investing in the best product projects • To ensure that the right work is being done – Caveat: The process is not about checking boxes 43 © Copyright Sequent Learning Networks ®
  44. 44. Process application with respect to planning • Major new products Phase 1 Phase 2 • Enhancements Phase 2 Phase 3 • Blockbusters 44 Phase 1 Phase 1 Phase 2 Phase 3 Phase 3 © Copyright Sequent Learning Networks ®
  45. 45. Post-Launch Product Management It’s about managing performance! • Refers to strategies and tactics to optimize the performance of current products in the market Post-Launch Product Management Performance Management Growth-Maturity-Decline 45 • Data collection, analysis, and replanning new marketing mix initiatives is vital • Using the cross-functional team like the product’s board of directors to make informed, relevant business decisions © Copyright Sequent Learning Networks ®
  46. 46. PM processes can improve the “business” • All products follow a life cycle • Knowing what to do, with whom, and when, improves business efficiency and results • Elevated business & marketing discipline helps everyone Page 46 © Copyright Sequent Learning Networks ®
  47. 47. 10 PMs need committed, aligned executives to properly govern (guide) Product Management as a business function. 47 © Copyright Sequent Learning Networks ®
  48. 48. Imperatives for organizational success 1. Executives must be aligned around the function and purpose of Product Management 2. A Chief Product Officer should be appointed and should have a seat at the table 3. A product portfolio council should serve as the single source of reconciliation of all product, platform, and portfolio investments 4. A Product Management governance board should be established to guide key processes and programs to enable the success of Product Management – and product managers 5. The PM governance board should enable “continuous improvement” of Product Management 48 © Copyright Sequent Learning Networks ®
  49. 49. Why Product Management Matters • It’s a function that, when properly chartered, will add value to a firm because if focuses on the product’s business from a holistic perspective – No other function in a business can properly and effectively fill this role • Product Management can transform an organization into a highly performing, market focused enterprise – Its efforts create a unified view of markets to conquer – It minimizes functional agendas that may not act in the best interest of the collective organization 49 © Copyright Sequent Learning Networks ®
  50. 50. Thank you! Steven Haines Sequent Learning Networks The Product Management Executive Board +1 212.647.9100 50 © Copyright Sequent Learning Networks ®