Learn about the 3 things you can do to improve Product Management and your innovation process
Some time ago I had a very interesting discussion with a major global consulting company about the best set-up for product development for technology driven B2B products. Which also brought us to discuss Product Management. A function which was seen as often flawed and a source of frustration.
please note: the following only applies to B2B for mechatronic products. Product Management for consumer products or software is a completely different type of animal.
Could there be systematic organization and governance deficiencies? Let’s address the typical complaints about Product Management. We surely will discover some improvement opportunities.
Complaint #1:
“Product Management doesn’t know the market / the customers”
Especially colleagues from Sales express this criticism. Which in my opinion is both, true and unjust. Yes, I also know many product managers who have not spoken directly with a customer for years. On the other hand, who is better positioned to invite his colleague from Product Management to join a customer meeting than the sales people themselves?
Complaint #2:
“Product Management is thinking in terms of technology features and not in terms of customer relevant features”
I invite you to have a look at the background of the Product Management colleagues in your organization. Most likely also in your company the majority were in some kind of engineering role or even directly in Product Development prior to becoming a Product Manager. I’ve seen this over and over again: if you recruit or transfer engineering experts to Product Management the above complaint will be the logical consequence!
Complaint #3:
“Product Management is not innovative”
Quite frankly, I believe this is a totally wrong expectation. The role of Product Management is not to generate ideas and create innovations. It should compile and structure ideas which originate typically in Sales, Business Development and Product / Advance Development. When it comes to innovation, Product Management shall be the moderator and in an ideal world a facilitator.
Complaint #4:
“Product Management is too slow, they are always behind instead of being ahead of the market / competition”
Again I invite you to reflect about the processes in your company, especially the budget allocations. Everyone claims that the business and the environment changes faster than ever. Yet, our budgets are discussed and determined once a year on a yearly basis. Like we did last year, like we did 10 years ago and like we did 50 years ago.
And typically the budget process, especially for development entities, is preceded by some form of strategy processes and road-map alignment talks. Which means it typically takes 9 to 18 months from the initial expression of an idea or a business opportunity over all the strategy, alignment and budget processes until an actual development project can be started.
overhead and over-management bingo
A look at the org chart is extremely revealing when it comes to the innovation dynamics of a company. Let’s do the “overhead and over-management bingo”. If you can tick off 5 or more of the following job titles in your organization then you know where to attack for more agility and quicker innovations:
So, did you win the “overhead and over-management bingo”? Don’t worry. Awareness is the first step to improvement. Read on. There are some very practical recommendations next.
In a nutshell, what do these complaints tell us?
- we perfected our organization and processes for transparency, control and management of literally everything and are surprised that we killed agility and innovations
- we put the wrong people into Product Management
The 3 things you can do !
So what can we learn from this? What can we do to improve Product Management and innovation in general?
Key learning #1:
Define a realistic and meaningful mission statement for Product Management!
What do I mean by this? Avoid fuzzy and broad responsibility descriptions, like everything from innovation to quality and costs of products without Product Management actually having the means to control and manage all of this.
Product Management should not decide what you develop, Sales or the business unit leadership shall do. Product Management does not decide how you develop a product. You have a Product Development organization which hopefully is good at this. And Product Management does not build your products. You have Procurement, Production and Quality dealing with this.
In most cases the definition will be something along “Central unit for creating transparency about our products and development projects (features, applications, costs, quality, relative positioning, competitive landscape…) with responsibility for the respective documentation and monitoring”.
This differs a lot from typical text book or (theoretical) internet definitions of what Product Management is. Often I observe a total mismatch between the claimed responsibility of Product Management and its actual means to manage and control the respective elements. Be realistic. Overstretching mission and responsibility of Product Management only creates frustration.
Key learning #2:
Put the right people into Product Management!
Never ever assign your most senior and experienced engineers to Product Management. Yes, you want to have people motivated by good products with fantastic (customer value!) features. There you just got your clue: look for product and solution minded people in Sales and Marketing or actually also in Controlling. (If you think about it, there is a lot of similarity between Product Management and Controlling.) But my first choice would be Sales as the source for your product managers – by far!
Note: avoid the temptation to move under-performers from Sales or Marketing to Product Management. This group is too important for your long term success to be used as a parking area.
Key learning #3:
Clean up your innovation and development processes!
The first step is easy: create a fully detailed business process model of all your processes from product / innovation related business need or opportunity up to the actual development project. The above bingo matrix might provide you with valuable hints about potentially overlooked process loops and involved parties.
Add the typical duration for each process and alignment activity. Don’t forget road-blocks or extra delays like “not foreseen in this years budget”.
Once the transparency about the many involved entities and the respective time delays is created the tough part starts: process simplification.
Innovation velocity increase will require to get rid of some old habits and reduce process steps as well as involved parties. Which is the most difficult part as it will quickly become personal. Who likes to learn that he or she is not involved any more? Or the involvement is “downgraded” from Decide to Inform.
Let’s summarize the 3 things you can do to improve Product Management and your innovation process:
- Create a realistic mission statement for Product Management.
Avoid including targets which Product Management does not control. - Put the right people into Product Management.
Your preferred sources should be Sales, Marketing and Controlling (in this order) - Streamline your innovation processes.
Especially create flexibility beyond the yearly budget rhythm.
Do you have additional thoughts or ideas for Product Management in a B2B mechatronic products environment? I’m eager to learn from you.