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Product Opportunities Assessment

Opportunities for new products exist all around us, in every market, even mature markets. This is because what is possible is always changing. New technologies are constantly emerging, new people with new talents join your company, and competitors come and go. The product manager must be able to quickly evaluate opportunities to decide which are promising and which are not, and for the ones that look appealing, which ones should be pursued, which are best left for others, and which ideas are not yet ready for productization.

In many companies, it just comes down from above that we really need to do this product. In other companies, the marketing organization determines what products are needed.

In either case, too often the process of deciding whether or not to build a product is left to intuition (or worse, a large customer will offer to fund a “special” and this becomes the basis for a product effort).

Typically someone on the business side or in marketing will create some form of a Market Requirements Document (MRD) that is intended to describe the problem to be solved, and usually includes a business justification as well. The purpose of the MRD is to describe the opportunity, not the solution. At least that’s the theory. In practice, many companies don’t really do MRD’s, or if they do, they’re essentially product specs that are called MRD’s. When true MRD’s are done, they suffer many of the same problems as PRD’s – they take too long to write, they aren’t read, and they often don’t answer the key questions they need to.

The result is that many product managers ignore the MRD. But the problem with not doing anything and just jumping right into the product is that it is generally a good idea to look before you leap. The challenge is to do this in a quick, lightweight, yet effective manner.

I consider this “Product Opportunity Assessment,” as I prefer to call it, an extremely important responsibility of the product manager. The purpose of a good product opportunity assessment is either to a) prevent the company from wasting time and money on poor opportunities; or b) for those that are good opportunities, to understand what will be required to succeed.

Fortunately, it’s really not that hard to do a useful product opportunity assessment. I ask product managers to answer ten fundamental questions:

1. Exactly what problem will this solve? (value proposition)
2. For whom do we solve that problem? (target market)
3. How big is the opportunity? (market size)
4. What alternatives are out there? (competitive landscape)
5. Why are we best suited to pursue this? (our differentiator)
6. Why now? (market window)
7. How will we get this product to market? (go-to-market strategy)
8. How will we measure success/make money from this product? (metrics/revenue strategy)
9. What factors are critical to success? (solution requirements)
10. Given the above, what’s the recommendation? (go or no-go)

The hardest question to answer is usually the first, which surprises people because it sounds like the easiest. But ask most product managers what problem their product is intended to solve, and you usually get a rambling list of features and capabilities, rather than the a crisp, clear and compelling statement of exactly the problem that’s solved.

Another difficult problem can be in assessing the size of the opportunity. You can get thoughts on this from industry analysts, trade associations, your finance staff, and from your own bottom up calculations. This is a topic in itself, but for now just remember to be conservative and realize that not every opportunity needs to be a billion dollar market.

The “go-to-market” strategy is especially important as that describes how this product would be sold, which can have very significant impact on the product requirements.

The solution requirements refer to any special needs or requirements that were identified during the investigation. Again, we’re not describing the product here but rather making clear any dependencies or constraints. For example, if this is a product that will be sold through system integrators, then these types of partners have requirements around extensibility of the products they deliver. Similarly, there may be branding or partnership requirements.

A product organization is all about pursuing good opportunities and providing great product solutions. Opportunities for new products are everywhere, and it is important that the product manager be able to effectively evaluate new opportunities and identify those that have the most potential for the company. It is just as important that bad product ideas get identified at this stage, before significant time and cost is lost chasing them. Choosing the right set of products to pursue is among the most important decisions a company will make.

It is important that the results of the product opportunity assessment be presented and discussed with senior management, and that the company make a clear go or no-go decision on whether to pursue a product to meet this opportunity. If you do decide to proceed, you will be much better informed as to what you are getting yourself into and what it will take to succeed.

So what do you do if the CEO tells you that this is what we’re doing, so just get to work on the product? First, realize that there are sometimes strategic reasons for doing a product, so you might need to pursue a product even when it’s unlikely to succeed in the market. That said, I have found that doing this lightweight, quick product opportunity assessment is still valuable in that I become much better informed about what this product involves. It is possible that what you learn will change your CEO’s opinion, but more likely it is a good opportunity, and your CEO was right to want to pursue it, but at least now you know what you’re up against if you are to succeed.

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Posted by on November 25, 2011 in Product Management, Uncategorized

 

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Facets of Product Management

In this article, I myself will try and understand the role of Product Manager and of Product Marketing Manager:

It Is What You Define It Is!

CTO : This is why he would like to have a role of Product Manager : He wanted someone to document all the features in their product (which had already been created) in one Word document so that they can understand what features were in their product. He also said he didn’t want the PM team to “muck around with defining features or product strategy” because between him and the VP of Engineering, they had it covered.

VP – Engineering : This is why he would like to have a role of Product Manager :- “What is the biggest reason you want to build a product management team?”. He told me that he wanted someone to create UML diagrams of the current product as well as for all the new features that he planned to come up with so that developers could implement them.

What Do Product Managers Do?
While the role of a PM varies widely depending on the company, there are several key responsibilities that product managers usually undertake at a vast majority of successful high-tech companies – based on my research and as well as conversations with friends in the industry. Here is how you can group them:

i.        Market Research:

This refers to the activities of studying a market to understand the customer needs, competitive landscape, and market forces – with the ultimate goal of uncovering opportunities for creating product enhancements as well as new products.

This is done via conversations with customers or potential customers, talking to customer-facing teams such as sales and support, studying reports and articles on the marketplace, test driving competitive products, keeping tabs on customer behavior, and other such activities.

This culminates with the PM preparing a business case, product strategy and/or business requirements document (BRD) detailing how to capitalize on the uncovered opportunities.

ii.        Product Definition and Design:

a) Product Definition refers to the activities of specifying what a product needs to do. This is usually done via what is referred to as Market Requirements Document (MRD) or Product Requirements Document (PRD). This document may include information such as product vision, target market, competitive summary, detailed description of product features, prioritization of features, use cases, system requirements, performance requirements, sales and support requirements, etc.

b) Product Design refers to the activities of specifying the look and feel of the product including the user interface (UI) and the user interaction with the product – covering the whole spectrum of user experience. In larger companies the PM works with UI designers or interaction designers to create this, while in startups the PM may do all of these.

I consider this to be the most valuable among a PM’s activities – so much so that I actually think product manager jobs which don’t include this responsibility are really not product manager jobs at all!

iii.        Project Management:

This refers to the activities of leading cross-functional teams including engineering, QA, UI design, marketing, sales and support to develop and launch the product on-time and on-budget. This may include securing resources, creating project timelines, tracking progress against timeline, identifying critical paths, getting additional resources when needed, and communicating status to the executive team.

In larger companies, Project Managers actually perform most of these activities with the support of PM’s. In very small startups, the PM may be asked to do these by herself. In some companies, the Engineering Lead may do most of these activities as well.

iv.        Evangelizing the Product:

This includes the activities of communicating the product benefits, features and target markets, and in general championing the product to internal teams such as sales, marketing, support and executives. This also includes evangelizing the product to external audience such as press, analysts and customers.

In larger companies, the PM is supported by the Product Marketing, Marketing Communications (MarCom) and/or Press Relations (PR) teams in evangelizing to external audience.

I consider this to be the second most valuable among a PM’s activities – especially evangelizing to the sales & marketing teams, and the executives to create excitement around the product.

v.        Product Marketing:

 

This refers to the activities of outbound messaging – telling the world about the product. This includes creating collateral such as datasheets, brochures, website, flash presentations, press packages, trade shows and more.

In larger companies, the product marketing activities are almost always separated from the PM. They’re instead performed by the Product Marketing Manager. The biggest shortcoming of this arrangement is the resultant inefficiencies in communication and the weakening of outbound messaging.

In some companies the terms ‘Product Management‘ and ‘Product Marketing’ are used synonymously and one person is responsible for all activities. In companies where there are separate ‘Product Management’ and ‘Product Marketing’ groups, the latter group performs all the activities mentioned in this category.

vi.        Product Life Cycle Management:

This refers to the activities of managing a product as it goes through its life cycle from ideation to launch to growth to maturity, and eventually to decline.

This includes tasks such as product positioning, pricing and promotion, product portfolio management, competitive strategy, making build/buy/partner decisions, and identifying and developing partnerships. The PM works with Product Marketing, Business Development and MarCom teams on many of these activities.

There you have it – my attempt at demystifying the role of product management.

 

 
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Posted by on November 5, 2011 in Product Management, Uncategorized

 

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