Product Management’s Scale – Size of Organization Matters and Impacts the Role

Product Management in Small Organizations 

Start-up organizations often rely heavily on the CEO or founder to develop initial products, identify markets and form a team to investigate and pursue potential markets. Because start-up organizations are typically small and often short of cash, the CEO will frequently hold on to the product management role through the early years. Often, a CEO in a small organization will actually have a familiarity with product management acquired earlier in his or her career. As the organization grows, the CEO will usually relinquish the product management role to a successor and devote attention to other more global areas of business concern. Prepare yourself to succeed the CEO in the product management role by personally staying aware of every aspect of the development and deployment process. Think creatively and don’t hold back on ideas you have for streamlining and improving the process. When the day comes for the CEO to turn over the reins of product management, you’ll be near the top of the list to fill the role.

Product Management in Scale Ups and Mid-Sized Organizations 

The CEO still cares deeply about product development in mid-sized organizations, but activities like raising capital, growing the customer base and scaling the size of the organization take on a higher importance. However, as the organization grows, the attention products need actually increases. Only by hiring a competent product manager able to keep abreast of the development activities, costs, market and competition facing the company’s products can the company continue to thrive at this critical stage in its lifecycle. Product management at this stage is primarily focused on effective scaling.

Product Management in the Large Organization

Product management is well established in a thriving, large organization. But that doesn’t mean that the CEO is completely detached. He or she is probably not involved in the day-to-day operations required to manage a product, but the boss never quits keeping an eye on the overall health of the company’s portfolio of products. Excellent product managers are the lifeblood of a successful large organization. At this stage of organizational maturity product management professionals look for growth opportunities organically and through mergers and acquisitions. While this type of activity can take place in organization’s of other sizes large organizations place a premium on these skills as it often becomes more difficult to achieve growth targets via organic growth alone as your company’s size increases.

If you can successfully manage resources, human and material, and keep a product or product line on a steady path of growth, you’ll be an invaluable asset to your organization with a bright future before you. However, it is important to remember that your organization’s size and product management’s scale will have an impact on your role. Wise product managers gravitate to organizations who’s span of responsibilities align with their interests and skills.

Advancing the Profession of Product Management
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High Performance Focus Areas

The first focal area is product team performance. In other words, what product teams say about their own performance. This year we continue to see improvement in the data indicating that product teams are gradually increasing their levels of performance. In fact, since we began examining product team performance in 2012 the number of respondents indicating consistency of execution reached an all time high this year. We attribute this increase to improved hiring conditions and the slow down in mass layoffs that adversely effected product teams during the great recession.

We also take a close look at product development adoption rates and perceptions about each methods impact upon profitability. We have four years of data that illustrates how Agile, Blended, Waterfall and Kanban have each fared over this time period.

In the second section we examine product management performance. There were quite a few surprises in this section. Our market research covers:

– Accountability metrics organizations are using to determine product management’s success or failure

– Time spent in the field talking to customers

– Backlog ownership

– Product management’s role in innovation

– Stand up frequency

In the third section we explore UX’s (user experiences) rise on product teams. Last year UX emerged as a factor in our regression analysis for the very first time. So this year we delve into UX reporting relationships, where UX should report to be most effective, and how user experience professionals are spending their time.

Regression Analysis

Finally, we uncovered four new factors that directly correlate with high performance on product teams.

– Making and sticking with decisions

– Stand up frequency

– Speed at overcoming unforeseen obstacles

– Active user experience engagement with product management

Over the last four years we have identified approximately twenty factors that contribute to high performance. Successful product development is complex and the more factors that product teams have effectively integrated into their activities the higher the likelihood a team will outperform its peers.

Get Your Copy Today

If you would like to download a copy of our latest market research you can do so by clicking here. Additionally, we just released new infographics covering product management and user experience as well as product teams.

Advancing the Profession of Product Management

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In our latest market research we wanted to hone in on some hard numbers and quantify satisfaction levels on today’s product teams. As a product management consulting and training organization we are currently witnessing fewer layoffs and more emphasis on hiring “the right” talent to augment existing product team members. While hiring has been slower than most organizations would desire – momentum has been picking up.

So just how satisfied are today’s product team members?

How Would You Characterize Your Satisfaction?

That was the question we asked in our most recent survey. Here’s what you told us.

Overall, those responding to the survey are satisfied with their positions. More than 63% indicate that they
are either satisfied (48.3%) or extremely satisfied (14.8%) in their work. An additional 24.6% experience
some level of satisfaction with their positions. Only 12.3% responded that they are dissatisfied with their
jobs, including 5.1% who are actively looking for employment in another organization.

Conclusion

Our findings show that the majority of product team members are pretty content with the status quo. Only 17.4% of respondents indicate that they are dissatisfied with their current positions and just 5.1% are actively looking to exit.

While these numbers are relatively low, turnover on product teams has a significant impact on performance. On-boarding newly minted product team members takes time and detracts from performance as other team members divert time from doing their specific job to bring new a team member up to speed. We know from past studies that only 4% of organizations indicate that they have a best practice bringing new product team members into the fold! The majority of organizations continue to rely upon the sink or swim approach.

Given the facts, what is your organization doing to retain the 17.4% of product team members who are at risk? Only 5.1% are actively looking but there is another 12.3% waiting for the right opportunity.

Advancing the Profession of Product Management

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Our data goes back to 2012 the first year we began conducting market research on this topic. That year the least number of product teams indicated that they were able to consistently deliver value on scope, schedule and cost. Interestingly, 2012 appears to have been the bottom of the trough as each year since then the positive response rate to this question has increased.

A Closer Look at the Actual Product Team Performance Data

Here are the actual numbers:

• 2012 – 13% of responses were positive
• 2013 – 21%
• 2014 – 33%
• 2015 – Not yet released (but trending upward)

So it is pretty clear that the number of survey respondents answering that their teams are delivering value consistently on scope, schedule and cost is on the rise.

What Accounts for This?

While we don’t have conclusive evidence to support our theory we believe that the key driver of this improvement has been staffing levels on product teams. During the depth of the great recession there were significant layoffs occurring both frequently and widely. Additionally, hiring was often frozen and was slow to thaw. As a result, a significant number of product teams were undermanned and to a large extent overworked. As the recessionary environment has lifted, product team members favorable responses to this question has also risen year-after-year.

What is your opinion? Has staffing improved in your organization and has it favorably impacted your product team’s performance? Or is your product team still struggling due to resource constraints and a reduced focus on talent acquisition? We want to hear from you. Let us know how your product team is performing.

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“Honestly, Work Just Sucks for Too Many People”

There’s a sense in the prevailing market that “I just have to do my mindless job.” However,Bock doesn’t believe it has to be that way. The Google way is grounded in the following principles of making work better:

• Transparency
• Effective goal setting
• Frequent performance reviews
• Less middle management

Less hierarchy is particularly important as Google believes that this encourages employees to solve problems for themselves. Emphasis is also placed upon encouraging frequent assessments of employee performance – as well as that of their bosses. This flat organizational structure is predicated upon being able to hire the “right” people regardless of their background. Mr. Bock states that the right people generally possess the following characteristics; smart, conscientious and humble. Of course, Google has significant advantages in attracting talent that may or may not be applicable at your company. And Google can be choosy. He indicates that the company hires fewer than 1 in 200 people who apply for open positions!

When hiring, Google employs a hiring-by-committee approach. Whereby each interviewer asks a candidate questions derived from a standardized list. Follow-on interviewers must ask the same questions, for easy comparison, and to eliminate interviewer bias.

Once hired and productive the company’s emphasis shifts to keeping employees happy at work through “people analytics.” This term refers to data gleaned from management experiments that the company conducts. Some of these practices are immediately noticeable such as free food and few middle managers. Other data-derived practices such as increased pay for maternity leave and the resulting 50% decline in new mother attrition are less visible but no less meaningful.

It Remains to Be Seen if These Hiring Practices Are Scalable

Not all organizations can be as selective. So it remains to be seen how scalable Google’s hiring practices truly are. However, Bock points to other organizations that have come to similar conclusions about hiring practices, notably, Costco and Wegman’s. Mr. Bock believes that while wages are important the act of giving employees freedom to act on their own makes them more likely to behave as an “owner” taking responsibility to the next level across every part of the business.

Google’s resources make it possible to do a wide variety of things to improve employee hiring practices and retention. Would these practices be applicable at your organization?

Source: The Wall Street Journal, At Google, the Science of Working Better, Christopher Mims, March 30, 2015

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This industry-wide problem presents a unique challenge to those who aspire to become product managers. So here are some tips that can tilt the odds in your favor…

Consider Jumping into the Shallow End of the Pool – Look to enter the product management profession in a domain you have deep industry experience in – the bar is lowest there. Trying to get your first break as a product manager in a domain that you don’t thoroughly understand will make the task more difficult. Remember, the bigger the domain, example healthcare, the more likely it is that you can swim in it for your entire career. Picking a smaller domain will mean that you will likely have to change domains later in your career – which can be just as hard as getting your first chance! Choose wisely.

Develop Connections in the Field by Contributing to a Product Management Association – Join a local product management association and actively participate. This will give you some product management cred to point to on a resume and it will also provide you with opportunities to establish professional connections while increasing your knowledge. Additionally, many product management associations are places that recruiters and companies search for product management candidates.

Take Product Management Training Courses to Enrich Your Knowledge of the Profession – Because of the lack of commonly agreed upon industry standards for the practice of product management each training course is unique. Regardless, this should not dissuade you from taking one or more training courses in an effort to enhance your knowledge of the field and to learn the language of product management.

Read Product Management Books to Enhance Your Knowledge and Increase Your Functional Vocabulary – Organizations are tribal by nature so make sure that you speak the language of those who are familiar with product management. This can raise the odds in your favor. A casual reference to a well-known author and their approach to solving a particular problem can to help establish both credibility and a connection during the interview process.

Call Out the Achievements In Your Profile and Resume That Align to Your Product Management Goals – Product management is about creating and maintaining value throughout all stages of the product management lifecycle. So make sure to demonstrate that you understand the value of the role and reinforce it by pointing to the things you have done in your previous positions that align to your aspirations.

The good news is that very few people begin their careers as a product manager. The majority start in another function (e.g. engineering, sales, marketing, etc.). If you make the necessary investments to build out your skills, master the terminology, and make the right connections while relentlessly pursuing your objective things should ultimately break your way.

The ball is in your court.

Greg Geracie is a recognized thought leader in the field of product management and the President of Actuation Consulting, a global provider of product management consulting, training, and advisory services to some of the world’s most well-known organizations. Greg is also the author of the global best seller Take Charge Product Management. He is also an adjunct professor at DePaul University’s College of Computing and Digital Media where he teaches graduate and undergraduate courses on high-tech and digital product management. 

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The wall I am referring to is domain experience. Most product managers run into this wall at some point in their career. Typically, when they have run their course in whatever industry they initially started in.

Almost every product manager starts in another function. Most start in engineering, sales, or marketing and make their way into product management. This domain becomes a home of sorts. If the product manager is fortunate enough to have started in a broad domain it is possible to spend your entire career safely cocooned inside.

However, many domains are transient or too narrowly defined to spend your entire professional career within. This is typically when product managers start to realize that there is an invisible wall that they had been largely unaware of until they tried to pass through it. Many successful product managers assume that their skills are readily transferable from one domain to the next. A large percentage of these product managers hit this invisible wall and, like mimes, feel their way around it.

Why does this happen? It’s because organizations, when faced with uncertainty, find comfort in the known. In my experience, working with organizations across a wide range of industries doing consulting and product management training, companies are rich with domain knowledge. That is not something businesses lack. What they do lack is product management expertise. That is a much scarcer resource.

So why don’t organization’s compensate and hire for product management skills? It’s because as a profession we have done a poor job of defining our boundaries. If you compare product management to project management you will find that the skill sets required to be a successful project manager are well known. A hiring manger’s knowledge about what to look for when hiring a project manager enables project managers to nimbly jump domains. The same can be said for professions like finance and human resources. This cannot be said for product management and most importantly product managers.

Until this paradigm shifts and we have industry consensus or the next closest thing, a large number of product managers will continuously encounter the invisible wall. For my part, I think it is time to work together at the professional level to shatter this glass wall and empower product managers to freely move from one domain to the next.

Care to join me?

Greg Geracie is a recognized thought leader in the field of product management and the President of Actuation Consulting, a global provider of product management consulting, training, and advisory services to some of the world’s most well-known organizations. Greg is also the author of the global best seller Take Charge Product Management. He is also an adjunct professor at DePaul University’s College of Computing and Digital Media where he teaches graduate and undergraduate courses on high-tech and digital product management.

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Obstacles that Undermine the Product Team  Copyright Actuation Consulting. All rights reserved.

The most frequently cited obstacle that product teams report was “not having enough resources to get the job done properly.” These resources could be either human or financial. This should not be too much of a surprise as organizations are still struggling to overcome the macro economic impact of the great recession – particularly upon staffing levels and hiring. However, what is striking about this response is that over a third of organizations report that resources remain their primary challenge in achieving higher levels of performance. This was also the most frequently cited obstacle in last year’s study.

The second most common challenge was “hand-offs between the functions”. Almost 22% of organizations said that cross-functional hand-offs were challenging and leading to performance related issues. Organizations frequently indicate requirements and product launch as particularly troublesome areas.

The third area that product teams point to is a “lack of executive leadership and direction.” Interestingly, only 37% of product teams state that there is a clear and coherent corporate strategy that they can tether to in terms or product development. In fact, 54% of organizations told us that while their organization has a corporate strategy – it is either poorly communicated or changing so frequently that the product team views it as useless. Respondents point to less active involvement by executives as a significant factor contributing to low levels or product team performance.

The final area that product teams call out is “poorly defined roles.” Lack of role definition, particularly in the areas of who does what and when impacts the effectiveness of product teams. This can lead to leadership boundary issues, duplicate efforts, conflicts between different perspectives and functions, and a wide range of other issues that have a meaningful impact on performance.

So how does your product team stack up? Do you see reflections of these issues in your organization and on your product team? If so, you are not alone.

Greg Geracie is a recognized thought leader in the field of product management and the President of Actuation Consulting, a global provider of product management consulting, training, and advisory services to some of the world’s most well-known organizations. Greg is also the author of the global best seller Take Charge Product Management. He is also an adjunct professor at DePaul University’s College of Computing and Digital Media where he teaches graduate and undergraduate courses on high-tech and digital product management.

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