Product Management Challenges - II

This article is continuation of earlier Product Management Challenges - I and highlights the tough road being traversed by this genre of managers.

Competitive Landscape in an “IT Doesn’t Matter” era

If we go by Nicholas Carr’s famous article, Information Technology as a whole is becoming a commodity which no more would give a sustainable competitive advantage. So , business acceptance of a software product for purchase considerations is slowly getting apprehensive. “Why to invest further on IT if they are able to go business-as-usual?” or “Today we are implementing Oracle Apps R12, tomorrow we need to migrate to Fusion, there is no end to it”. So any software product should provide ample value proposition to the customer which compels him/her to try/buy it. Add the competitors to it and your product sustainability and customer lock-ins are always at a threat. That’s why we see many product start-ups initially working in stealth mode, doing their own internal pilot testing , getting the relevant product and consumer insights to get a differentiatied offering which would outsmart their competitors.

Resource Crunch

This is especially in the area of user experience designing. There are very few visual and interaction designer and many times their scarcity limits the firm capability to form the crux of the product team. If there are no designers working side by side with the product managers & engineers, it will limit what each of them can do.

Consumerisation

In layman’s view , it refers to the blurring line between the consumer and enterprise technology needs. And many a times, a new technological product is launched first to ordinary end user and once the product gets popular amongst the masses, it is being offered to the enterprise customers with additional value layers. For example, Google’s Application products were first opened to the masses and then it came up with the enterprise version. Apple recently launched Joint Venture, a tech support offering for small businesses covering the products like Mac, iPhone, iPad -- the very same ones which got sold off to general consumer. The challenge is to formulate your product strategy and roadmap across these blurring lines , to accept that the B2B and B2C distinction of end product usage is fast getting extinct.

The Successful Company Trap

Seeing the Google making hoards of money and awed by the fantastic products line from Apple, are you thinking to do product management like them? Be cautious. The point to be noted is that while Google & Apple have their own models of product management, the same might not give you a success formula. Their model is fit for them (until their founders remain so deeply involved in their product offering).

Cloud : SaaP vs SaaS

Cloud is both a challenge as well as an opportunity. If the existing product line is not web-based , then the firm has the danger of losing out on its existing and prospective customers. This is particularly important in emerging markets where the consumer is not ready to pay too much for the software product and hence the rise of ad-supported freemium business model in these markets. With SaaS the switching costs are decreasing plus the anytime anywhere access of the product which brings newer challenges to the product manager to continually improvise on the product for customer retention.

Customer vs Consumer

Often the people that make the purchase decision are very different than those that actually use and and are dependant on the product. The product manager ends up being responsible for a product that will be sold to (or used by) people he has never met, to people that speak a language he doesn’t understand, subject to laws that he isn’t aware of, and pay by mechanisms he has never used. The platform product management is a good example - Adobe offers Photoshop which is being used by slew of designers to create media/flash applications which are finally ‘consumed’ by totally set of people.

Product Management Challenges - I

Coming in early , working relentlessly until late nights , day after day , week after week but still not satisfied and happy ; packed days with back-to-back meetings , burst of emails piling up , the changing customer dynamics, the race to catch up with emerging trends & technologies and the various stakeholders’ pressure for that one magic product expected out of your team – Welcome to the world of Product Management !

The thrill of getting a successful product being used by the whole world comes with its own set of challenges to be faced by the product managers.  This article discusses a few of these challenges:

Lack of Role Clarity

Great software products come from the collaboration of product management, product design, engineering, and marketing team. One important aspect to the organizational design is that these teams should be equals but invariably we see one getting buried within another. The organisations have a tendency to mix/overlap the Product Management with the Product Marketing roles and responsibilities. Hence , many times we might see Product Managers striving to create their own niche space and acceptance within the organization, proving subconsciously that yes they are required and needed. My short product management stint made me notice a sort of humorous role confusion : The business team thinking that the product management guys are from the engineering side while the engineering team having a notion that they are from the business side ! So the role clarity itself becomes a challenge.

In a nutshell , we can have a very high level distinction:

Product Management	Product Marketing
Responsible for defining – in detail – the product that the engineering team will build.	Responsible for telling the world about this product
Defines Product Requirements	Defines Marketing Requirements
Activities include Product discovery, idea generation , ensuring that the product is useful, usable and feasible,  optimizing the end-user experience.	Activities involve : Pricing, Positioning and messaging, Promotions, Launching, Online marketing , Customer Acquisition Strategies.
Both should collaborate effectively for the product to succeed

Stakeholder Management , Buy-ins , trade-offs and Consensus Tendency

One of the biggest challenges is convincing others like the top management about any innovation's utility. Selling the product idea and concept to the internal customers who will fund the project for product development is not an easy nut to crack. Lack of required upfront support and funding increases the time-to-market.

A very effective way the product discovery team can handle this scenario is by creating a prototype which can be shown to the stakeholders. The nature of the discussion will be more productive when stakeholders can see a clickable prototype versus something just talked about in air or in some form of paper/powerpoint specification.

Within the organization , Product Managers need to aliase/interact with many parties : product marketeers , project managers, interaction designers, visual designers, usability engineers, prototypers, engineers, architects, QAs , cross-functional teams, etc. The decisions are being taken in concensus and become more of a group activity. The product objective shufts from coming up with something great, to coming up with something that keeps everyone happy and doesn’t get you fired which actually negatively impacts the product innovation. Seth Godin said: “Nothing is what happens when everyone has to agree.” While consensus is something nice to have, we basically need more of collaboration wherein the teams can work together closely and provide a fusion of customer value/functionality, usability, and technology.

High Expectations

Yes, the customers would expect your product to solve all of their problems and your CEO would want to roll out the new release at a breathnecking speed. And if you are an engineer plus MBA breed , don’t get surprised if you are being considered superhuman. The best way to tackle is to communicate a very realistic picture to your internal and external customers. If the expected deadline is too tight , break the work to be done in chunks and modules ,  identify the actual achievable roadmap and convey the same assertively. Using numbers, some sort of data crunching to prove your point helps invariably.

Product’s Success Metric

There is a lack on clarity on how exactly a Product Manager’s performance can be articulated except the fact that it naturally should be linked to the Product’s Success. But again , there is no best way to measure a product’s success. Should it be through the revenue generated? Or Profit? Or the number of end-users? All of these parameters can be useful but they don’t really provide the exact picture.

One simple business metric coming up recently (and adopted by the likes of Apple, eBay and Amazon ) is called the Net Promoter Score (NPS). The customers are asked how likely they would recommend the  product, on a scale of 0 to 10. Those rating 9 or 10 are called “promoters” (they’re out there telling others to adopt the product); those rating 7 or 8 are called lukewarm or neutral; and those giving 0-6 are called the “detractors,” which are not likely to recommend the product to others, and may even be actively warning against the product.

NPS = The percentage of promoters - The percentage of detractors 

Balance between Domain and Technological Expertise

Product Management requires skills like assessing opportunities, defining product principles, product discovery, and prototype testing. The whole idea is to discover a product-market fit and this requires a deep understanding of both the market needs and the technology’s capabilities. The challenge is how to keep pace with the domain/market trends and rapidly changing technlogies when the job requires your day-in and day-out effort. This is very critical while you interact with various teams and plan for product/feature feasibility. Even the product lifecycle is also getting shorter putting on you those extra worries to speed up in order to monetarily benefit from the existing product as fast as possible.