Losing Market Share? Time to Reinvent Product Management

This article originally appeared on Forbes.com

Product managers at many large tech companies are stuck in a narrow, outdated concept of their role. They typically focus on just one product line, even though their customers increasingly want broad-based solutions, not a bunch of discrete and disconnected items.

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At a time when the cloud, artificial intelligence and the Internet of Things have disrupted the way products and services are designed and delivered, customers expect speed, value, and ease of use—in short, a friction-free, end-to-end experience.

But many product managers are effectively fighting the last war. They aim to ship products on time and on budget. While these are worthy business goals, meeting them doesn’t mean a product will succeed in the marketplace or that customers will be delighted. Incumbent tech companies stuck in this antiquated mindset are vulnerable to declining sales and shrinking market shares.

Many leadership teams know they have a problem, but how do they fix it?

Forward-looking tech firms are adopting an outward-looking, customer-centric approach known as offering management (OM). The key to offering management is reimagining what it means to be a product manager.

Under OM, a product manager is accountable for the full life cycle of an offering, including validating the need in the marketplace; determining the business model; and assessing the implications for engineering, marketing, sales, support and budgeting. Offering managers think like owners, and they have a mandate to work across business units and disciplines to harness the company’s full arsenal of talent and intellectual property.

When offering managers are carefully selected, trained and empowered, they can emerge as visionaries in an organization, with keen insights into what customers want. No longer mere functionaries whose primary task is to meet operational timetables and budgets, offering managers can become leaders, agents of change and, above all, advocates for the customer. For offering managers, the needs of customers, not the goals of engineers, always take priority.

Offering managers aren’t managers in the conventional sense. They don’t have armies of people reporting to them. Their job is to set priorities, spell out resource requirements and delineate the support they’ll need from other parts of the organization. Along with deep experience in specific markets, offering managers need intangible skills, such as perseverance, creativity and the ability to inspire others. They must lead through influence, not directives.

When product managers are empowered, and when they are called upon to rigorously defend their positions, they can come up with singular insights. For example, Adobe spotted a trend that rivals and industry analysts were slow to recognize. They saw that customers for digital marketing software no longer wanted piecemeal products—one product for web analytics, another for campaign management, and still others for audience management and social media marketing.

Beginning in 2009, Adobe made a series of targeted acquisitions in digital marketing segments, then melded those products into a suite of integrated offerings. Eight years after entering the business, Adobe is now a market leader in digital marketing software.

At analytics company Teradata, offering managers who used to have a narrow scope of authority now have a broad remit over the entire life cycle of the product and the customer experience. Teradata offering managers now map out priorities across functions, assuming decision-making rights previously held by the heads of individual departments. With this new power comes new accountability—and new opportunities for advancement.

In the year or so since Teradata began its transition to OM, the company has already started seeing results in the marketplace, notably with the launch of IntelliCloud, a cloud-based software-as-a-service offering introduced in the first quarter of 2017.

Offering managers are responsible not just for getting a product to market, but also for what happens to the product once it’s in the market.

To track what’s happening to a product in the market, offering managers set up feedback loops. Companies collect essential information from a variety of customer touchpoints—direct purchases, resellers, contact centers, the web, mobile apps and social media—distill it and route it back to the offering manger, who’s then responsible for acting on the feedback to stay ahead of the market or close critical gaps with competitive offerings.

Companies wondering whether they need to change their product management organization often start by asking themselves a simple question: Are they gaining or losing market share?

If they’re losing share, chances are good that something is broken in product management. When product managers becoming offering managers, they assume responsibility for the product’s entire journey from the lab to the customer. For them, market share is the metric that matters most. When their product succeeds in the marketplace, offering managers reap the rewards—and so do their customers.

Mark Brinda and David Mortlock are partners with Bain & Company’s Telecommunications, Media and Technology practice in New York. James Dixon is a partner with the Telecommunications, Media and Technology practice in Silicon Valley.