The Rise of Product Management

From its foundational beginnings in early brand management to high-tech software program management, product management has emerged as its own collective of product-focused best practices. Product Management is a vital component of organizations undergoing digital transformation.

The Origins of Product Management

The?story?goes like this. Product management dates back to the 1930s with the concept of “brand management” pioneered at Proctor & Gamble. The?memo?that started it all sounds more like modern product marketing than product management, but your mileage may vary.

Others?point to 1990s Microsoft, which introduced the role of a “program manager.” The program manager was part of the Engineering department. It was their job to ensure all aspects of the product development process were aligned and working together. Program management was steeped in technical processes, but also considered how product decisions would impact the product’s end users.

The best recap I dug up on how modern product management evolved is by?Aakash Gupta. At the very least, it resonated with my experience. I’m buying that modern day product management, regardless of its origins, began at Hewlett Packard. The primary function was to serve as the bridge between Engineering and Marketing.

The Bridge

My first experience with Product Management was in 1997 at the Silicon Valley startup, Tumbleweed Communications.?Ken Beer?was the Director of Product Management and reported into the Marketing department. It was not unusual to find PM’s who reported into Engineering at the time, the two cases perhaps reflecting the above origin stories.

I remember Ken coming to me to get my reflections on the Tumbleweed product, since, as the IT Manager (yes, I was IT back in the day), I was pretty much the only person setting up and maintaining a production server. (We were “pre-customer” and no, we didn’t IPO without customers. But don’t ask how many when we did.)

I don’t know how technical Ken was back then, but he had the respect of the Software Engineers, which was critical. His primary function was to digest the Founders’ vision, understand the market, illicit requirements from customers, and work with Engineering management to determine what would make it into the next release.

He was well educated, charming, witty, able to dance, write poetry, sing, play music, wrestle, ride horses, and be able to fight as a swordsman.

It’s interesting to reflect that in 1997, the Agile Manifesto had not yet been published. Despite being in the early days of the digital revolution, products followed a pretty traditional analog product process. Also, while human-centered design certainly existed, the practices of “design thinking” reaching tech companies to any real degree was still a decade away. Product Management reflected both of these facts.

By 2001, I was running Product Management at a different company. I had never heard of Agile. We were Waterfall. The entire product was defined before starting and while I gathered feature requirements directly from customers, “customer-centricity” was still fairly shallow. But, it was better than what existed before when sales would walk into engineer’s offices and demand features in order to “close the deal.”

Agile and Human-Centered Design

The Agile Manifesto of 2001 was a game-changer in product development. The approach empowered software developers to build products in an iterative and flexible manner. It also went beyond just the “how” to build a product and focused on the “why” as well. The Agile Manifesto put the customer at the center of the product development process, ensuring (theoretically) that the final product met the needs and wants of the target audience.

Agile recognizes that a software product is never “done.” It’s merely released. (Marketing, I fear, has not yet realized this.) It’s never perfect. I used to photograph public displays of Microsoft’s Blue Screen of Death on digital news displays wrapping around city buildings, for example.

PMs must understand why customers want or need functionality, often informing marketing and other business functions that sell, distribute, and support customers.

If a product is never done, maybe development teams should look up from their work once in a while, take in new information, and change their work if necessary. New information might include checking with customers whether they’re on the right path or not. (Go figure!)

In a similar vein to Agile, specific practices around designing software with humans in mind was nascent in the 1990s. It gained momentum in the 2000s thanks to people like?Alan Cooper?and the?Kelley brothers. Being “customer-centric” no longer simply meant imagining you were your customer while sitting around a conference room table. It meant practicing empathy, understanding the customer more deeply, observing them in their native habitat–ironically, perhaps, as P&G was known for.

This is a role not just for product designers, but for product managers, whose responsibilities don’t include the how of development. PMs must understand why customers want or need functionality, often informing marketing and other business functions that sell, distribute, and support customers.

The central role of PMs, often called the “CEO of the product”, eventually led to their own function, including a VP of Product Management or Chief Product Officer, reporting directly to the CEO.

Corporate Digital Transformation

The COVID pandemic marked a point of acceleration for corporate digital transformation. The companies that performed the best were digital or had at least adopted a digital age mindset. Not surprisingly, companies that never had product managers are now forming product management teams.

These organizations are now living in a world where the product is never done and their systems, structures, and processes must reflect that. The product management function is the right group to design, test, and iterate upon those systems.

To succeed, companies must at some level be digital ready:

1. Development team is agile, with an eye toward making the whole company agile. The PMs will be a conduit for expanding agile beyond Engineering.
2. Employees are close to customers — hiring outside agencies, doing “market research”, and otherwise separating employees from customers is anachronistic. This is true even in business to business companies and highly regulated industries.
3. Evidence informs decisions — leaders should yield to data and insights.
4. Compete based on creating value — If M&A, government lobbying, or selling ice to polar bears is your primary growth engine, you don’t need product management.

Digital Transformation is not so much about technology. Technology is the easy part, though it certainly may be costly and time-consuming. The hard part is the human side. It’s developing the necessary mindset, followed by changes in how the company manages the new way of working to allow it to flourish.

Rapid technological developments and increased digitization in virtually every industry are the primary reasons for the rise of product management

Fittingly, building a product management organization that can help lead this effort, perhaps with support from the?innovation team?is key. Here are 5 requirements for great product managers you won’t see in a job description:

1. Understands how to understand customers — Product Management is no longer merely about farming for requirements
2. Knows how to create personas that reflect real people — not a Frankenstein amalgamation of data attributes.
3. Buys into Agile principles — Anyone can?learn?Agile, but understanding and believing in the core principles is what will lead to successful products
4. Groks progress toward outcome metrics — Different than measuring goals or tracking tasks, product success is steered by focusing on the right learning metrics at the right time.
5. Is a “renaissance” human — I love this description:

“The ideal European ‘Renaissance Man’ excelled in a variety of areas. He was well educated, charming, witty, able to dance, write poetry, sing, play music, wrestle, ride horses, and be able to fight as a swordsman.”

She can write poetry AND wrestle ??. Product Managers are at their best when they naturally look outside themselves to take in the world. They have a broad range of skills and are willing to learn more. They don’t create or live inside silos, they break them down. They realize their own imperfections and seek to get better. They zoom out to see and zoom in to focus. They will respectfully push back, will not be pushed over, and always push forward.

Rapid technological developments and increased digitization in virtually every industry are the primary reasons for the rise of product management. Digital transformation has made it possible for organizations to create new products and services that meet the needs of their customers in new and innovative ways. For example, many banks have gone completely online, while others, like Capital One, have created “cafes” instead of formal branches to interact with customers. Product management functions are often the first to create these innovations and bridge the old and new in a digital way and serve customers in ways that were not possible before.

Another reason for the rise in product management is the increased focus on metrics and analytics. Product managers are now able to use data and analytics to understand what features are working and what is not. This helps organizations build the right product and make informed decisions about their product roadmap. In addition, organizations are using data and analytics to understand how their products are being used. This helps them to make improvements that will benefit their end users.

Product Management Today and Tomorrow

Product Management has been a discipline in the business world for several decades. However, it has become increasingly important with the acceleration of digital transformation in large businesses. As organizations continue to adapt to advancements in technology, and increasingly incorporate digital solutions into their products, Product Management will be a critical part of product success and innovation. Product Management will help organizations understand what their customers need and create new products and services that meet those needs for both the short and long term. The Product Management function leads the way in the human side of digital transformation.

Recommended: Product Management experts you should know:?Marissa Mayer,?Janna Bastow, and?Elizabeth Casey.

Other Resources:?Here are 11 online communities product managers could find helpful

We also put together two downloadable guides to help you through your product management phase. To claim them DM me on LinkedIn or email [email protected]

BRANT COOPER, The New York Times bestselling author of The Lean Entrepreneur and Disruption Proof and CEO of Moves the Needle. He is a trusted adviser to startups and large enterprises around the world. With more than 25 years of expertise in changing industrial age mindset into digital age opportunity, he blends agile, human-centered design, and lean methodologies to ignite entrepreneurial action from the front lines to the C-suite.