Product Manager is Not the CEO of the Product!

We all have heard this analogy that “a product manager is a CEO of a product”. The mini-CEO concept comes up at interviews, PM conferences, and other meetings especially where Ben Horowitz’ famous memo is referred to ??. This is probably one of the biggest myths in product management.

On the other hand, there are plenty of reasons to believe that being a PM is a great training ground to be a CEO eventually. More on this in a bit.

Here are my two cents on why the generalized PM-CEO equation is a myth.

PMs have no authority, yet have to drive consensus: Unlike a CEO, a PM usually has no formal authority on people or budget - but rather, the PM manages by influence. A PM has to hold complex conversations with all functions including the engineering, design, sales, marketing, operations, finance, and the legal team. Naturally, you get to deal with plenty of conflicting opinions and priorities, and very often have to come up with creative ways to handle the HiPPO (HIghest Paid Person’s Opinion :-P)!

Nobody reports to a PM: Usually, a PM has no direct/indirect reports, but you are the hub for the entire product team. With no direct team, you have to build credibility and trust without actually being “in charge”.

Often doesn’t own the P&L: Being called a CEO without any P&L responsibilities sounds far-fetched, doesn’t it? In most organisations, the PM does not own the P&L. The P&L ownership lies with a general manager or the business unit leader. A PM deals with financials when preparing a business plan, and tracking usage.

Not just talk strategy, but have to walk the talk: I’m not saying that CEOs don’t have to walk the talk. But a PM not only has to give strategic direction at every stage of product development, but also get down and dirty in the trenches at every step – from when the first line of code is written, to when the product is being tested, until the product is shipped/released. And the cycle goes on with each new feature added or version released.

That said, being a PM is a great training to be a CEO in the long run. The very nature of the PM role prepares you with skills you need to be a successful C-suite executive.

How Does a PM Role Prepare You to be a CEO?

Think Satya Nadella, Sundar Pichai, Marissa Meyer, Indra Nooyi, and more – all former PMs who have grown to lead their organizations, all Product Manager CEOs. 

Looking at their career paths, you can see that being a PM prepares you with the following skillsets that can potentially set you on a C-suite trajectory.

Ring-side view of all strategic functions: As a PM you liaise with all other functions aligning them around the product’s strategic vision. This ring-side view helps you gain a good understanding of how the different functions operate, their pain points and how they all contribute to the organisations success.

Empathy: On a PM journey, one of the skills you develop is the ability to listen closely to what is being said and understand what is not being said. You also learn to ask better questions to understand the underlying motivations of various stakeholders – be it customer, business or the tech team.

Industry understanding: A PM has a thorough understanding of industry updates, changing competitor and market dynamics.

Data-driven decision making: A PM uses internal and external data to make decisions and convince stakeholders – customer needs, market insight, competitor intelligence, and internal metrics.

Business and tech acumen: In a world where business results are driven by leveraging technology, product management gives you an opportunity to truly understand and appreciate technology. Understanding and leveraging technology to drive the bigger long-term vision is an important C-suite skill.

Prioritisation - a CEO is always trying to ensure that the organisation is investing in the right areas. As a PM this is something you do everyday :-)

A product management background combined with a strong general management exposure can give a competitive edge for CEO-aspirants. This is probably why many companies have rotational programs in product management for future leaders – e.g. Google Associate Product Manager Program, Facebook Rotational Product Manager Program, and the Dropbox Rotation Program.

In short, a PM role pushes you to think and act like a CEO in many ways. All those skills of leading by influence, empathy for users and the team, and strong engagements with the customer and partner ecosystem are what could nurture future CEOs.