The following insights were gleaned from a presentation at INDUSTRY given by Jeff Lash of SiriusDecisions (@JeffLash).
Download Product Management TACTICS eBook for more.
What factors make Product Management successful? Of surveyed companies, only 15% said that 75% of their products met projected revenue goals. What are these companies doing differently? What sets them apart from the other 85%?
There are four best practices that correlate to success: 1) customer needs focus, 2) disciplined product investment spending, 3) product lifecycle process, and 4) functional roles and development.
Successful companies have an above average understanding of customer needs, customer and market focused product lifecycle processes, and a commitment to a formal customer needs program. Those that are struggling see all sorts of things happening:
- Experiencing low win rates
- Competition is catching up or, worse, overtaking your market share.
- Low retention
- Customers demanding improvements
- High cost and levels of support required
- Reliance on price breaks to close deals
- Low levels of product satisfaction.
There’s no substitute for watching customers use your product. Don’t just do this with your customers. Talk to competitors’ customers. Understand them deeply to make improvements to products and strategy.
Successful companies have disciplined product investment spending. Of those analyzed, 71% have formal investment scoring criteria and 61% align product spending tightly with business strategy. Investment decision-making problems result in bad products getting too much funding and high potential/growth opportunities not getting enough. Support for a product investment decision-making process helps those submitting requests for funding as well as those involved in making the funding decisions. When you’re making investment decisions, look at the overall investment cost. Don’t focus on the opportunity only — also focus on the ability to win.
On Product Lifecycle Process: 37% of successful companies have a defined lifecycle process that nearly all initiatives adhere to, and 30% have a process that includes all required activities and deliverables. Without a consistent product lifecycle process, too much can be left to chance according to the knowledge or preferences of individual product managers. Assess existing processes, then implement an improved process in phases and provide support and upskilling to enable Product Managers to follow it.
On Functional roles and development: 77% of successful companies indicate that the role of Product Management and its goals are very well understood, with 71% providing upskilling training and support on an ongoing basis. Issues in this area are often visible relative to internal processes and behaviors. They also affect the product in the market. Collaborate on changes to Product Management roles and responsibilities. Assess the current maturity, competencies, and processes in place within Product Management and look for quick wins in the most pressing areas.