Introducing Product

Management and Managing

Product Managers
TOPICS COVERED
Introducing Product Management and Managing Product Managers

WILL PRODUCT
MANAGEMENT
BRING BENEFITS TO
BUSINESSES?
Introducing Product Management and Managing Product Managers

A practice adopted by a
company in which all activities
related to development of a
product are handled is called
PRODUCT MANAGEMENT.
 Introducing Product Management and Managing Product Managers

Shifting from a functional

organizational structure to a
team or matrix-based
structure, such as PRODUCT
MANAGEMENT, it requires a
thorough planning.
Introducing Product Management and Managing Product Managers

Job descriptions must clearly

Matrix-based structure in
define the roles of product
product management
manager and set expectations
refers to an organizational for other departments. Since
design where employees product managers depend on
report to multiple the cooperation of various

managers or leaders rather functions without having direct

control, clear objectives are
than a single one.
crucial for success.
Introducing Product Management and Managing Product Managers

However, some
companies adopt the
product manager role
simply to mimic FOUR STEPS
competitors, often
without fully
INVOLVED IN
understanding the INITIATING
responsibilities PRODUCT
involved. MANAGEMENT.
Introducing Product Management and Managing Product Managers

FOUR STEPS
INVOLVED IN
INITIATING
The company must assess whether product Characteristics of successful product
PRODUCT management is the appropriate
MANAGEMENT. managers must be identified, with
organizational form and, if it is appropriate,
decide what reporting structure (hierarchy) suitable personnel recruited for the
it will have. product management openings.

The company must clearly specify There must be a system for

the responsibilities of product
managers as well as other integral
developing and evaluating
members of the system. product managers.
Introducing Product Management and Managing Product Managers
Introducing Product Management and Managing Product Managers

WHAT IS A
PRODUCT IS A PRODUCT
MANAGER? MANAGER
IMPORTANT TO AN
ORGANIZATION?
ASSESSING THE NEED
Introducing Product FOR AND
Management STRUCTURE
and OF PRODUCT
Managing Product MANAGEMENT
Managers

WHAT IS A
PRODUCT Product Managers are
MANAGER? the silent heroes of
innovation, they own
every stage of a
product's lifecycle.
ASSESSING THE NEED FOR AND STRUCTURE OF PRODUCT MANAGEMENT
ASSESSING THE NEED FOR AND STRUCTURE OF PRODUCT MANAGEMENT

• Product management becomes a suitable

organizational structure when a company's product
line expands beyond the capabilities of a functional
structure.
ASSESSING THE NEED FOR AND STRUCTURE OF PRODUCT MANAGEMENT

• Product management becomes a suitable

organizational structure when a company's product
line expands beyond the capabilities of a functional
structure.

• This approach is effective when there are too many products for
a single marketing manager, when products differ significantly
in competition and customer groups, or when specialized
product knowledge is needed.
ASSESSING THE NEED FOR AND STRUCTURE OF PRODUCT MANAGEMENT

• In such cases, a PRODUCT MANAGER oversees the

development and marketing of a product line across
different divisions or markets.

• When products are perceived as nearly identical by

customers, a traditional product manager structure
might lead to unnecessary differentiation efforts.

• In such cases, a market or segment management

approach could be more effective. Market managers
focus on growing distinct markets for a product line,
adapting and bundling products to fit specific
segments needs.

• Sometimes, "Special Products" managers may also be

needed to work alongside segment managers.
 ASSESSING THE NEED FOR AND STRUCTURE OF PRODUCT MANAGEMENT

• Key account or national account

management is a variation of market
management, designed to handle
large customers like "category
killers".
• Key account managers focus on
adapting products to meet the
specific needs of these major clients.
This role can relieve product
managers from spending excessive
time on special requests by handling
those requests and collaborating with
product managers on necessary
adaptations.
TOPICS COVERED
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The Impact of New-Product Development
 The Impact of New-Product Development

• The final key aspect in organizational

structure is new product development.
While most product managers dedicate a
large portion of their time to new product
development, some organizations opt to
assign a new product manager position
to handle product specifications and
design, with the product managers
carrying out the marketing activities.
Implementing a Global Structure

• For global companies, managing

product development adds another
layer of complexity. They need to
determine if a single product manager
will have global oversight, if product
managers should collaborate with
country managers, or if there should be
distinct product managers for each
country.

• At the very least, product managers will

participate in cross-cultural teams that
harness the diverse skills from various
regions of the global organization.
Reducing Hierarchy

• Hierarchies aim to minimize errors, but they often

stifle personal accountability, creativity, and the
willingness to take risks. This is why many
management experts have advocated for different
forms of horizontal organizations, focusing on
enhancing products and services for the end
customer.

• Product managers and their teams align with this

approach when they are connected to customer
satisfaction (as they should be) and empowered to
make key decisions about their product lines.
Specifying Responsibilities of Product Managers and Others in the Firm

• To minimize the potential for miscommunication

and misunderstanding and to increase the
chances of a successful product management
structure, management must thoroughly explain
to key managers exactly how the organizational
concept will work and what the underlying
rationale is for moving to it.

• It’s important to specify not only the roles of

product managers, but also the roles of the
individuals with whom they commonly interact.
Specifying Responsibilities of Product Managers and Others in the Firm

Marketing Services Manager Marketing Research Manager Regional Sales Managers

TOPICS COVERED
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Characteristics of Successful Product Managers

SENIOR VICE PRESIDENT

• Setting overall direction and priorities of

the organization.

• Allocating overall resources.

BUSINESS UNIT
MANAGER
• Approving annual product
business plans and budgets.

• Determining product resource

allocation.
Characteristics of Successful Product Managers

PRODUCT
DEVELOPMENT
• Conducting feasibility studies of
new products/major
enhancements.

• Coordinating the development

and introduction of new
products.

MARKET RESEARCH

• Measuring, tracking, and reporting product market shares.

• Conducting product research as requested.

 Characteristics of Successful Product Managers

Marketing and Communications SALES

• Developing and coordinating product-related • Prospecting for new business
marketing and sales communication. opportunities.
• Assisting in the development of marketing • Closing sales.
plans Executing marketing plans
Characteristics of Successful Product Managers

CORPORATE RELATIONS
• Identifying new business
opportunities and
OPERATIONS retention strategies

• Providing routine • Coordinating corporate

customer support and business development
service plans

• Providing product
operational efficiency
 Characteristics of Successful Product Managers

QUALITY ASSURANCE
PERSONNEL
• Assisting in the
• Developing and development and
implementing a product monitoring of quality
manager professional standards.
development plan.
• Providing process
• Conducting product improvement evaluations.
manager specialized skill
training.
 Characteristics of Successful Product Managers

• Product managers who are

coordinators primarily function as
administrators to assure deadlines
are met and requests are carried
out. Coordinative product
managers are more likely to deal
with budgets than plans.

• Product managers who are

directive not only coordinate
projects but also develop product
plans. Product managers who are
leaders are more entrepreneurial
and become more active in the
strategic planning of products and
services for the company.
TOPICS COVERED
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Developing and Evaluating Product Managers

• Product managers need a variety of

knowledge, including product/industry
knowledge, business knowledge, and
interpersonal/management knowledge.
Since beginning product managers
typically spend most of their time
gathering and organizing information on
the product, its customers, and the
competition, product knowledge is
paramount.
Developing and Evaluating Product Managers

• According to Bill Meserve, a principal at

the management-consulting firm of
Temple, Barker & Sloane Inc., training
and motivation are critical at this time,
and career development must be an
obligation:

For product managers to be

effective, they need to build bridges
throughout the company and be cross-
functional leaders.
Developing and Evaluating Product Managers

• The downfall of several product or brand

management systems was the establishment
of a product manager as caretaker of the
product, with an emphasis on “safe” results.
Product managers were charged with
immediate results rather than the creation of
long-term customer value.

• Profit contribution is the amount of product

revenue remaining after subtracting all of a
product manager’s direct, controllable, or
relevant expenses.
Developing and Evaluating Product Managers

• This contribution to overhead (CTO) figure is a fairer

assessment of performance than is fully allocated
profit, because CTO minimizes the concern over the
validity of the allocation methodology.

• In addition to financial measures, product managers

may be evaluated on some combination of other
factors, such as the following:
• Successful introduction of new products
• Market share defense or growth
• Customer satisfaction indexes
• Attainment of company-specific goals
Developing and Evaluating Product Managers

KEYS TO PRODUCT MANAGEMENT

SUCCESS
√ Recognize product management as an organizational business form, not as an isolated job
function.

√ Prevent product management from being done in the absence of market management.
Otherwise, you run the risk of being production-driven rather than market-driven..

√ Develop an information system of cost, business, and market data according to the relevant
products or product lines.

√ Clarify the roles of product managers and the roles of those with whom they routinely
interact..
Developing and Evaluating Product Managers

KEYS TO PRODUCT MANAGEMENT

SUCCESS
√ Push product managers to evolve from being solely product specialists to being cross-
functional leaders..

√ Establish performance goals that reflect company expectations and provide the tools
(budgets, people resources, approval authority) to achieve the goals.

√ Select product managers with the skills appropriate for the culture, expectations, and
responsibilities for your company. Provide additional training as required.
 THANK YOU FOR LISTENING!

ALI, DANIEL PAGA, PATRICIA ZAFE, JANNA T RASMAÑO,

NELSON