Product management


Product management is an organisational function within a company dealing with new product development, business justification, planning, verification, forecasting, pricing, product launch, and marketing of a product or products at all stages of the product lifecycle. Similarly, product lifecycle management integrates people, data, processes and business systems. It provides product information for companies and their extended supply chain enterprise.

Overview

The role may consist of product development and product marketing, which are different efforts, with the objective of maximizing sales revenues, market share, and profit margins. The product management is an active part of the initiation of a new product concept through to the readiness and commercial launch and sales of new products. Product management drives the business case and justification to start new product development and has an active role throughout the steps and or stages to develop, test and launch a new product. Product management is also involved in product change and lifecycle decisions and planning. Product elimination can begin with the identification of candidates for a change in lifecycle. This process then proceeds with a cross functional plan to remove the product from active sale. The obsolescence plan will include a comprehensive view of the impact on the organization (inventory associated with the product, assets and manufacturing / assembly resources associated with the producing the products, active commercial agreements, service and support requirements, and marketing assets and areas to update and update.

Tasks

The product manager is often responsible for analyzing market conditions and defining features or functions of a product and for overseeing the production of the product. The role of product management spans many activities from strategic to tactical and varies based on the organizational structure of the company. To maximize the impact and benefits to an organization, Product management must be an independent function separate on its own.
While involved with the entire product lifecycle, the product management's main focus is on driving new product development. According to the Product Development and Management Association, superior and differentiated new products—ones that deliver unique benefits and superior value to the customer—are the number one driver of success and product profitability.

Role of a product manager

Depending on the company size and history, product management has a variety of functions and roles. Sometimes there is a product manager, and sometimes the role of product manager is shared by other roles. Frequently there is Profit and Loss responsibility as a key metric for evaluating product manager performance. In some companies, the product management function is the hub of many other activities around the product. In others, it is one of many things that need to happen to bring a product to market and actively monitor and manage it in-market. In very large companies, the product manager may have effective control over shipment decisions to customers, when system specifications are not being met.
Product management often serves an inter-disciplinary role, bridging gaps within the company between teams of different expertise, most notably between engineering-oriented teams and commercially oriented teams. For example, product managers often translate business objectives set for a product by Marketing or Sales into engineering requirements. Conversely, they may work to explain the capabilities and limitations of the finished product back to Marketing and Sales. Product managers may also have one or more direct reports who manage operational tasks and/or a change manager who can oversee new initiatives. Manufacturing is separate from the research function, the product manager has the responsibility to bridge the gaps if any exist.
In most technology companies, most product managers possess knowledge in the following areas: computer science, business and user experience. Also, in many companies the role is understood as a project manager. The difference between a product manager and a project manager is that the project manager focuses on building a solution and tracking its progress, while a product manager focuses on solving a customer problem.

Responsibilities

Examples of the responsibilities of a product manager are: Perform market and competition analysis, initiate product and product-specific service improvements, requirement profiles for new products and product-specific services, participate in the specifications creation, create and implement market launch concepts, support and train the sales as well as accompany field service employees on customer visits.
The product manager is responsible both for the development of the product strategy and for planning, implementation and coordination of the measures derived from it and for the permanent and final control. They are responsible for managing products across departments.

Product management in companies

Product management is typically divided into three parts: strategic product management, technical product management and Go-To-Market, which is illustrated in the Open Product Management Workflow model. In addition to the three-part division, this model shows which tasks and steps must be performed by product management in the course of a product cycle in order to produce an innovative and profitable product.

Strategic product management

Strategic product management encompasses all strategic aspects and tasks required to make an existing or future product successful. This includes, among other things, the information analysis, the development of a concept as well as coordination and optimization measures. In technical product management there is a similar approach.

Market analysis

The market analysis identifies existing market problems and trends.
For the determination of market problems, the conducting of interviews with customers as well as potentials has established itself, whereby existing problems are specifically asked for. Market trends are determined by the analysis of studies or with the help of market research. The results are checked by means of larger & regular surveys and that a market problem only refers to one persona in a certain scenario. If several products/markets are involved, they can be structured according to criteria such as market segments, product segments, functions, technologies or regions and later be illustrated, for example, in a product-market matrix. Market segmentation is of particular importance; strategic product management focuses on the target segments that have the greatest market potential and require the lowest costs.

Company analysis

Both for the future market message and for improved communication with customers, it is important to determine the attributes and added values that differentiate the company from the competition in the long term: "If you can do one thing best, you should do the one thing you can do". A competence analysis forms the basis for this. A competitive analysis and a SWOT analysis can provide further clarity. While the competitive analysis reveals gaps, among other things, the portfolio, price model, market message and communication analysis, the SWOT analysis determines the company's position in a specific market. In addition, the analysis can show what opportunities for further development and difficulties in implementation exist.

Technical product management

Technical product management includes all aspects and tasks necessary to design a functional physical new product. There is a procedure for this like in strategic product management:

Requirements rating

At the beginning the requirements from the strategic product management must be evaluated, which consist of the parts problem, persona and scenario. In practice the information is written for it on so-called "Story Cards". With the help of an evaluation scheme with the criteria importance, number of reports and priority, the requirements can be weighted and prioritized. The importance is based on the different customer types in the following decreasing order: evaluating customer, potential customer, existing customer. The priority can be calculated by multiplying the importance and the number of reports. If required, the scheme can be supplemented with additional information such as costs, usability or time expenditure.

Product development

If the requirements are sufficiently prioritised, they can be bundled into work packages and put in order; for this purpose the respective priorities are summed up and an overall priority for a work package is calculated. Afterwards the time and costs required for the work packages must be estimated for product development. Then engineers devote themselves to the solution of the work packages, giving the entire team information about their current status in regular status meetings and modifying the schedule by possible delays. In order to check the functionality of a product solution or to reduce the risk of undesirable developments, the creation of a preprototype and a prototype is recommended.

Product marketing

The results from strategic product management serve as a prerequisite for a successful product management. Product marketing is a component of product management that is under the jurisdiction of a company's product manager or product marketing manager. The product marketing manager is primarily responsible for the profitability of the products, product launches, messaging and all sales-supporting materials. Together with the communication team the plan for all marketing activities and the communication channels has to be created. At the same time measuring points need to be defined for reviewing the success of the marketing measures and regularly present their evaluation. Product marketing is involved in strategic derivatives such as market strategies, distribution strategies, positioning and communication strategies. Sales documents, presentations and tools from the results have to be created while the sales channels need to be supported with the relevant market facts from the strategic section so that their forecast is fact-based and more accurate. Through the contact with customers and non-customers the buyer persona develop steadily and their buying criteria, channels and problems van be identified and optimized. The product marketing manager creates the positioning for all defined market segments and enables the sales channels to deliver the persona-specific selling points.
Responsibilities within product marketing include:
Product development is the process of building products that will be consumed or used by others. Product managers often work collaboratively with engineers, designers, and other stakeholders to accomplish tasks, such as:
Many refer to inbound and outbound functions.
Inbound product management is the "radar" of the organization and involves absorbing information like customer research, competitive intelligence, industry analysis, trends, economic signals and competitive activity as well as documenting requirements and setting product strategy.
In comparison, outbound activities are focused on distributing or pushing messages, training sales people, go to market strategies and communicating messages through channels like advertising, PR and events.
In many organizations the inbound and outbound functions are performed by the same person.
As these terms are under discussion, another way of looking at these activities is upstream and downstream product management, where 'upstream' is referring to any activity that helps to define, create, or improve the product, while 'downstream' refers to any activity that promotes the product. This avoids the confusion with the term "inbound marketing" which nowadays clearly refers to a way of doing downstream product management, referring to 'making the product accessible', i.e. it can be found by suspects and prospects.
The confusion stems mainly from the mix up between the term "Marketing" as a discipline, comprising Product Management, MarCom, etc. and using the same term 'Marketing' as a synonym for 'Promotion' or 'advertising', i.e. taking a product to the market.
It comes as a surprise that this confusion and ambiguity is hard to understand- because if you name the main departments in today's organizations, you can clearly assign to Sales, R&D, Operations, and Marketing their respective core functions and areas of responsibility. The core function of Marketing, that differentiates it from Sales, Operations, and R&D is the ownership of the marketing mix. Still, many organizations put under 'Marketing' only Market Communications, which is just the operational end of marketing and only a subset of what 'Promotion' comprises. From a Product Management perspective, MarCom is a supporting function. In organizations, where the Product Management is weak or not existent, its tasks are taken over by the other departments, operations defines the prices, R&D defines the product, MarCom decides on the promotion.