This question comes up quite often, and even the most experienced business people tend to wonder about it. One of the main reasons why it is a little puzzling is because Product Management encompasses a wide responsibility area, and it also means different things to different organizations.
The most concise response you are likely to get is that; Product Management refers to strategically driving the marketing, development, and improvement of a company’s products. Of course, this sounds almost right from anyone’s perspective.
It is, however, an abstract definition of the role, and in this blog post, we shall get deeper into “What is Product Management?”
But First, let us define a product:
What is a product?
The best definition for a product is: a shared desire or need, normally offered to the market, and one that benefits its customers through the efficiencies of scale.
A product provides solutions to the market at a lower cost, and it is rooted in the market strategy.
So, what is Product Management?
Product Management therefore, is the strategic business function whose purpose is to build the right products, and ensure that they maximize value for their customers and the overall business through different stages which include planning, ideation and delivery.
Stages of Product Management
This is an extremely important stage in product management. It acts as both a road sign and the destination. The vision defines what you want to achieve and how the final product shall benefit the company as a whole.
This is where the strategy starts, and it is also the idea stage. The team meets to discuss a new product, which is the discovery of an opportunity in the market. This can take place in a brainstorming session which is based on everyone’s opinion of the new product.
The questions that should be answered in this stage include:
- What product shall we develop?
- What problems shall the product solve?
- How shall we be able to measure the success of the product?
Research and Customer Understanding
This stage is concerned with collection of information and analyzing the market and its customers. The team will be tasked with comparing products in the market that are similar to what you want to develop, and studying the competition in order to identify areas of improvement.
Knowing the customer is the basis for coming up with a successful product. Most customers will buy a product that meets their need, from a company that understands them.
The product management team should work with the marketing team to conduct various research oriented projects in order to gain a deeper understanding of the clientele.
This encompasses the following;
- Creation of user personas who are fictional characters that can represent the types of users who would be interested in the product. This is a portrait of the ideal customer you want. It should include information such as their age, educational levels, gender, income, common problems and spending habits.
- Identify their needs – once you have created the profiles, identify whether their needs can be solved using the proposed product. You can do this by grouping their needs in terms of quality, price, convenience and choice.
- Studying their behavior further – this involves trying to understand the psychology and motivations of your customers. It involves knowing why they would choose different products and how they identify which one to choose.
The Strategy Stage
Now, once you have the vision of the product, and you understand the market and what the customer’s want, you can now develop a specific product strategy. This is usually formulated to define the goals of the product, and describes how the team will achieve the set milestones.
It should be clear and realistic.
A good strategy should define the main features of the product, the needs of the users and the main KPIs – Key Performance Indicators that must be met by the product.
The strategy should be documented in a written roadmap form which should allow the team to control the work at any stage.
The product roadmap software is a tool that offers a framework for the team and gives a timeline with specific illustrations, actions, goals and the specific stage of the product development.
A good roadmap should be clear and serve as the visual guideline. Now, there isn’t any specific structure for the roadmap, but it should depict the current state of things and what the next step is.
It should also give you a chart showing all the other products you plan on delivering over the next 9-12 months, so you can achieve the vision.
What are KPIs?
KPI – key Performance Indicators refers to the measures of performance in the Product Management process. It involves revenues, costs, activities, usage and any other measure that helps in decision making.
They are used to monitor the process or failure of the product at hand. They should go hand in hand with the goals and must identify changes that will be required in order to get back in line with the strategy.
In conclusion, it is clear that product management is essentially about understanding the desires and needs of the customers, and its main purpose is to figure out the right product that shall ultimately solve these needs.
The role of a product manager also varies in each organization depending on the maturity of the product and the product under development. This is why in most cases it is hard to clearly define what Product Management is in each company.