The Rise of the SaaS Product Manager - Why Product Management is More Important Than Ever

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As the Software as a Service (SaaS) market continues to grow and change the landscape of IT products, some people are saying that the software product manager is an irrelevant and dying breed. While SaaS has changed some aspects for the Product Manager, such as the pace of new releases, the opportunity for increased influence of the user community and the ability to collect more useful data, these changes do not make the SaaS product manager irrelevant, but they do require the SaaS Product Manager to learn new skills and to use new tools in order for them to be effective and valuable in the world of SaaS.

In this presentation that I presented at SaaS University in Oct 2012, I have demonstrate how the principles of product management continue to apply to SaaS companies and then present a survey of effective product management practices currently being used by SaaS Product Managers.


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The Rise of the SaaS Product Manager - Why Product Management is More Important Than Ever

  1. 1. The Rise of the SaaS Product ManagerWhy Product Management Is More Important Than Ever! Tom Evans Lûcrum Marketing @compellingpm
  2. 2. Discussion Agenda• What Product Management Isn’t• What Is Product Management?• Product Management Practices in Saas Companies
  3. 3. This Isn’t Product Management • So what you do is you take the specifications from the customers and you bring them down to the software engineers? • That, thats right. • Well, then I gotta ask, then why cant the customers just take the specifications directly to the software people, huh? • Well, uh, uh, uh, because, uh, engineers are not good at dealing with customers. http://www.luminomagazine.com/mw/storyimages/1021_wide.jpg
  4. 4. These Aren’t Product Management Either• PM sits in office and determines what they think the customer wants.• PM creates thick requirements document and expects that engineering has all of the information they need.• PM collects all requirements and gets cross-functional team to prioritize.• PM only writes technical specs and tries to tell engineering how to do their job.
  5. 5. What is Product Management? “Product Management ensures the company delivers products that are valuable for the customer, company and partners throughout the entire product lifecycle”
  6. 6. Managing Throughout the Product Lifecycle
  7. 7. What Does Product Management Do?• Conduct market & competitive research• Solicit, validate and clarify requirements from stakeholders• Develop business case for major product investments• Create product strategy and communicate requirements• Define and defend the product positioning• Prioritize/order requirements (User Stories)• Validate resulting product with market• Support marketing, sales team, channel (sales tools)• Communicate clear & consistent market messages.• Help achieve key business metrics
  8. 8. Most Important Aspect of Product Management The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Peter Drucker Discover Market Needs That are Worthy of Solving!
  9. 9. Discovering/Understanding Market/User Needs• User communities / • Win/Loss analysis user groups • Social media• Usage analytics • Competitive analysis• A/B testing • Support issues• Feature requests • Industry analysts• Product advisory • Potential customers committees • RFPs• Customer calls/visits • Etc.
  10. 10. Balancing Needs of Multiple Constituents The role of a product manager is to serve as a communications "hub" for a publishers software, coordinating the different and frequently conflicting wishes, needs and priorities of development, sales, mark eting and customers. – Merrill R. (Rick) Chapman (2004) http://www.amazon.com/review/R3SJS38JIQMU8L
  11. 11. Creating a Profitable Product Strategy!
  12. 12. Product Management Practices for SaaS• Define and improve key product metrics• Create dynamic interactions with customer community• Align customer feedback with product strategy• Represent customers with development• Apply usage analytics appropriately• Create buzz around new capabilities
  13. 13. Improve Key Product Metrics• Metrics that drive your business model (e.g.) – Conversion ratios/times – Usage statistics – Net Promoter Score® – Support issues – Implementation time – Time to usage – Cost of Acquisition – Etc.
  14. 14. Dynamic Interactions with Community• Participate in the conversation• Actively solicit feedback• Present new ideas for feedback• Develop consensus• Identify customers for working groups• Build buzz about new features, capabilities, etc.
  15. 15. Represent Customers with Development• User Stories are a start of a conversation around a need to be met. – Elaborate via a grooming process – Engage customer working groups to elaborate requirements• Regularly demonstrate working software to customer working groups (after each iteration)• Give customer working group first access to final version
  16. 16. Align Customer Feedback with Strategy• Case Study - Mint.com• Many users requesting Quicken/MS Money type features.• Not their value proposition, not their target market• Clearly understood their key user persona & thus their product strategy.• What if they had responded to customer requests (not their target market, would have changed their positioning, etc.)
  17. 17. Apply Usage Analytics• Application of analytics depends on user interaction – How often and how complex of interaction• Simple workflows – Analytics provide valuable insight – Easy to do A/B testing• Complex interactions – Analytics is an important indicator, but in and of itself is not usually sufficient – Must understand context via customer discovery
  18. 18. Create Buzz Around New Capabilities• Challenge: no major launch events to build buzz• Active participation in online community and other online/social media• Plan schedule of new capabilities to create bundles that synergistically increase customer value• Make major announcements around bundle of new capabilities
  19. 19. Characteristics of a Successful Product Manager• Passionate about understanding market needs• Engages well with customers & non-customers at all levels• Provides leadership (vision, strategy) for their products• Works well with and develops respect with all parts of the organization• Understands how their product supports corporate strategy, goals, objectives• Delivers requirements to development supported by market evidence
  20. 20. Acknowledgements• Tom Hale, Chief Product Office, HomeAway• Erik Huddleston, Executive VP, Products and CTO, Dachis Group• Audrey Montgomery, Senior PM – SaaS Products, Blackbaud (Convio)• Denny Lecompte, VP – Products, SolarWinds
  21. 21. Thank You! Tom Evans Lûcrum Marketing tevans@lucrum-marketing.com +1.512.961.5267 @compellingpm Copyright 2012 - LÛCRUM MARKETING

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