How Executives Can Enable Product to Have Greater Impact

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As an executive, how can you set up your product organization for bigger business and customer impact? We surveyed product managers and product leaders to cut through the noise. Across individuals and leaders, and organizations of varying types and sizes, we found a consistent response: You can greatly improve your product managers’ and overall product function’s impact by ensuring:

1. Your people understand, leverage and contribute to your business model and strategy.
2. Your organization, top-to-bottom, values and measures outcomes over outputs.

In summary: Increase product’s impact through sufficient strategic context and outcome-based cultural alignment, investment, accountability and evaluation.

The need for product manager impact

As most companies are becoming digital, the customers of data-driven organizations expect better and better digital experiences, and the digital product function (including engineering, design, product management, product marketing, user research, data science, etc.) continues to rise in importance and impact, as well as in cost and people. While the most populous function in product is engineering, the product manager function has emerged as a high-leverage central function. Product managers are often conductors, helping define strategy, understand users, document needs, set priorities and drive to outcomes. Organizations need effective product managers to get the best outcomes from their entire product function and win over customers.

Fortunately, product managers tend to be highly motivated individuals who want to win, achieving outcomes for their users and business. Most product managers seek autonomy and the opportunity to help set product direction themselves, and they feel satisfied delivering outcomes/results over just outputs. Product managers seek to work in organizations where they can deliver impact.

Given the importance to the organization, and to the product managers themselves, that PMs deliver results, we asked, “How might product managers increase their impact?”

Background

We asked product managers and their supervisors, called product leaders, to score the importance of several intrinsic and extrinsic factors for achieving more business, organizational and customer-related impact. We spoke with representatives from roughly 100 companies, from 10-person startups to large companies, such as Amazon, Google, Microsoft and Walmart. We also asked respondents to identify their organizations as ones where product management is a strategic/driving function, a service/order-taking function or something in between.

Our biggest questions explored:

• What matters most for achieving more impact? What matters least?
• How are responses different for product managers themselves vs. their bosses?
• How do responses vary by company size?

Intrinsic factors evaluated included:

• Strategic and business thinking
• Partner alignment/collaboration skills
• Outcomes vs. outputs thinking
• Big-picture vs. small-picture thinking
• Grit/patience
• Judgment
• Years of PM experience

Extrinsic factors evaluated included:

• Resourcing (for example, number of engineers to work with)
• Infrastructure/tooling
• Training
• Quality and support of PM leadership
• Degree of PM department autonomy
• Organization’s culture (for example, outputs over outcomes)

Note: Please treat these findings as directional, not precise. While our survey didn’t produce thousands of responses to generate statistical significance in every data cut, we found the results to be consistent in direction and intensity.

Raw results

Finding 1: what matters most

Across all groups, the most important factor for increasing impact is a product manager’s strategic and business thinking. 74% of respondents rate this factor as critical for increasing impact. So much wasted product investment comes from directing teams in weak directions or with weak strategies. It can be difficult to know which direction out of several seemingly good options is the best one — but making this decision requires a strong understanding of an organization’s business and strategy. Note that, while sometimes, the product manager fails in directing/prioritizing well, it is sometimes the fault of the organization’s or product function’s leadership in failing to communicate strategic and business logic.

The next most important factor is the PM having an outcome-driven mentality (56% of respondents), in other words, focus on delivering products that return outcomes for the business vs. outputs that may be visible but may not be most meaningful. Similarly, the organization, including the CEO/leader, needs to empower product managers to pursue outcomes (49% of respondents). Both these points seem straightforward, but in organizations with unclear strategy or hard-to-measure goals, it is easy to build products because “someone senior thought it was the best idea” or “because we’ve had this idea in queue to get done.”

Finding 2: what matters least

We didn’t know what to expect for “what matters least,” as the survey options all came from conversations with product managers and product leaders. Every option listed has come up as a reasonable reason as to why leaders are dissatisfied with their direct reports, and what product managers see as challenges to achieving their desired impact.

While there was no single “matters least” factor on which the majority of respondents agreed, the top two least-mattering factors were tooling (for example, analytics, user research, split testing software), at 32% of respondents, and resourcing (for example, number of engineers, data scientists, user researchers), at 26% of respondents.

Given no majority response for this question, let’s not place too much weight on the specific leading results. But one key takeaway is that external factors the individual product manager can’t control (resourcing, tooling, etc.) seem to matter less for having impact than internal factors the individual can control (strategic thinking, outcome mentality). I often think back to a particularly successful product manager I’ve worked with, Jake, who when temporarily reduced to only three engineers for a couple of quarters, still made more progress and impact than most peers, earning a promotion.

A key exception here is the organizational context that affects the product management function: support for outcomes and degree of autonomy.

Finding 3: differences between individuals and their managers

We were curious to find if product managers (individual contributors) answered the survey differently from product leaders (supervisors of product managers). For example, might the product managers, at the ground level, see the world differently from their supervisors, who sit at a higher view?

We found the results from these two audiences to be quite similar. They share the same biggest and smallest impact drivers. There is a small difference between the two, though, in that product leaders view intrinsic factors to be more important than product managers do — PMs sometimes think they need more support, while their bosses think these PMs have everything they need to succeed. This difference may reveal an opportunity to drive better alignment and expectations across the team.

Finding 4: differences across organization sizes

We wondered if product leaders and product managers viewed impact-driving factors differently across organization sizes.

To our surprise, relevant importance of impact driving factors didn’t change across company sizes at all, sharing the same “most valuable” and “least valuable” factors.

Key takeaways for executives

Set your product management function up to deliver more business and user impact through sufficient:

• Strategic context: Does your organization communicate its business logic and strategy clearly enough, so all employees (product or other) know how you make money now and will win in the future?
• Outcome-based cultural alignment: Do your product leaders and their product managers see eye-to-eye on what results and approaches drive success in your organization? There is a risk that they might be misaligned and that the overall product function isn’t optimized for impact. Ask these questions to ensure your people are all rowing in the same direction.
• Outcome-based investment: Reactively, when your product leaders ask for more people and resources, first confirm current resources are being invested intelligently. Proactively, perform the same exercise regularly to zero-base your target product budget to build up to the smartest investment you can.
• Outcome-based accountability: Is your product function delivering for your business and customers? How do you know? Ensure the product strategy, goals and hiring are well-aligned around impact. Ask for product and roadmap ROI analysis.
• Outcome-based evaluation: Evaluate your potential and current product leaders and product managers for their business understanding and strategic thinking. Set and expect a high bar, and expect to see measurable results following your investment in product.