Product Owner vs Product Manager
There is a lot of confusion and resistance in the industry today. The role of Product Owner has emerged everywhere as more and more organizations are implementing Scrum. This causes tention and confusion between those Product Owners and the organization’s Product Managers. You may experience this tention and confusion yourself, or see it around you. In the many Agile and Digital transformations we have done, we have surely experienced this tention! This is why we decided to create some clarity around the topic “Product Owner vs Product Manager” with this blog that hopefully helps many people to create some clarity and implement both roles more effectively.
In The Product Samurai’s article “Product Owner vs Product Manager” from August 2019, Chris shared some ideas around this topic. The article you’re reading now is an extention to Chris’s original article, going more in-depth, as well as sharing some recommendations for your practice.
The structure of this article is as follows; We will start of with a short history on Product Management, since Product Managers existed prior to Product Owners. Then we‘ll see how Agile changed their world. After this we’ll dive into some context around the role of Product Owner. This will lead you to a comparison of the Product Owner and Product Manager roles. And we’ll close this article of with some conclusions and recommendations.
A Short History on Product Management
The profession of Product Management can be traced back to 1931, when a a memo was written by Neil H. McElroy at Procter & Gamble. In this memo, McElroy descibed so called “Brand Men”, which were people ultimately being responsible for a brand (including sales, marketing, product management, etc). After McElroy helped to transform Procter & Gamble into a brand-centric organization, the job of Product Manager was born.
After McElroy had become Secretary of Defense and helped to found NASA, he worked with two young entrepreneurs, being Bill Hewlett and David Packard, the founders of HP. These entrepreneurs interpreted the Brand Man idea as “putting decision making as close as possible to the customer”. And with this implementation, HP became one of the first companies to implement the Product Manager job as well as organizing itself by products.
Once Product Management came to the technology industry, many Product Managers focused more on the process of understanding the customers’ needs as well as finding a way to fulfill those needs using the classic marketing mix. In other words; the right Product, in the right Place, at the right Price, with the right Promotion.
At present day, a split between (Product) Marketing, Product Management and Product Development can still be seen in many organizations. These various departments all feel they “own” the product, the feel that they know the customer best and understand the marketplace best. In most technology companies though, Marketing has evolved to be more about owning the brand and about customer acquisition, while the Product organization owns the value proposition and Software Development or IT owns the development of the product.
Read more about the history of Product Management in this article.
Introducing Agile in Product Management
Back in the day, product development was a slow and laborious process, even in the technology industry. Many organizations followed (and some still follow) a long a waterfall process. In this approach, product managers first create a business case, then start doing extensive (market, customer and technology) research, they will be writing an extensive requirements document that takes several months, after which they will throw it over the wall to Engineering to build. Unfortunately, the result delivered by Engineering after many months of development is often completely different than Product Management expected. And therefore, the whole process will start all over again as the product is not valuable enough for customers and the organization.
In order to deal with such problems, various frameworks like Scrum, Crystal, XP and DSDM were developed in the 90s. These frameworks all aimed to develop (technical) products more effectively. It was only later (in 2001) that the Agile Manifesto was developed by seventeen software engineers and the creators of Scrum, XP and the like, who got together in the Snowbird Ski Resort in Utah. So frameworks like Scrum actually existed before Agile existed.
The origin of the Product Owner role
Looking at one of the most popular of these Agile frameworks, being Scrum, a clear distinction was created between roles. The Product Owner focuses on building “the right product”. The Development Team focuses on building the product “the right way”. And the Scrum Master focuses on “building it fast” (the process and getting feedback early and often). Together, the Scrum Team (Product Owner + Scrum Master + Development Team) tries to find the “sweet spot” for building an optimal product.
So, coming back to the topic of this article, the role of “Product Owner” originates from the Scrum Framework. When Ken Schwaber and Jeff Sutherland published the first official Scrum Guide in the 90s, they could have chosen to name the person responsible for building the right product: Product Manager. This would have been the simplest solution for them, as this role already existed in many organizations. However, exactly because this role already existed, the fear was that too little would change in the way that organizations build products or services. The fear was that these “waterfalling Product Managers” would continue their waterfall approach. In addition, organizations would respond to this by saying: “We already have Product Managers” and so they would continue to work in the same way they had done for many years, which wouldn’t help them to become more effective in product development.
So this means that… Yes! A Product Owner is a Product Manager! And a Product Manager could also be a Product Owner. Please pay attention to the bold and italic formatted COULD though. A Product Manager can take the role of being a Product Owner IF 1) he or she is part of a Scrum Team, 2) he or she applies Professional Scrum with that Scrum Team and 3) if he or she lives up to the Scrum Values. To put this in other words: A person can NOT be a Product Owner, if they remain at a distance from the teams, commanding people around and not taking part in all aspects of product ownership.
The same goes the other way around as well. A real Product Owner should not only be involved in (read: accountable for) (IT) development. A real Product Owner is also involved in all other aspects of the product management profession (e.g. vision, strategy, pricing, budgeting, sales, marketing and operations).
Image 4 illustrates how Product Management and Scrum relate to each other. The purpose or intention of the Scrum Guide is not to describe both “the process, roles, events and artifacts of Scrum” and “the profession of Product Management”. That would lead to a Scrum Guide of hundreds of pages, instead of the ~19 pages it is today. This is why you won’t find any information about market research, pricing, budgeting, product planning or most of the other Product Management responsibilities inside the Scrum Guide. However, ALL these responsibilities are part of professional Product Management AND ALL these responsibilities are needed in order to perform professional Product Ownership folks!
The far from perfect way to implement both the Product Owner and Product Manager roles
So let us compare the role of Product Owner and the job of Product Manager… Ehm… Okay… But, why you might think? You’ve just learned that they are pretty much the same thing right? Well, unfortunately some people and frameworks out there stimulate us to believe that that there are differences. And there are those of course who don’t like change, so they say there are differences, to keep the current situation as is. One of the companies that contributes to the confusion in the market is the company that created the SAFe framework, which is visualized in Image 5. The purpose of this article is not to bash on SAFe. There are definitely good things about it. However, those good things don’t include their view on Product Ownership and Product Management.
As you may have noticed in Image 5, SAFe contains tons of practices, processes, structures and roles that you and/or your organization could apply. In this framework you may also have noticed two groups of people: “Product Managers” and “Product Owners”. Within the framework, both have specific accountabilities and authorities. Once you click on the PO and PM icons, you can find more details about those roles as described by SAFe. Let us summarize the differences for you, based on the SAFe website:
A Product Manager IN THE SAFe FRAMEWORK takes care of all the strategic work. They own the product vision, roadmap, pricing, licensing and ROI. A PM also defined Features and Releases.
A Product Owner IN THE SAFe FRAMEWORK owns the Team Backlog. The PO contributes to the vision and roadmap, yet doesn’t own anything. A PO also defines User Stories.
In addition to the above, Image 6 (source: SAFe website) below illustrates that the Product Manager, Product Owner and Agile Teams should collaborate together in order to deliver value for customers. What is more interesting about Image 6 though is that it shows that the Product Manager is Market/Customer focused. And the Product Owner is Solution, Technology and Team focused. Now, that’s interesting! Why, are you wondering? Well, in that case, check out Image 2 from this blog again…
Did you re-check Image 2? Then you’ll have noticed that one of the problems in our industry is the split between Product Management, Product Marketing and Product Development. It is therefore interesting that SAFe actually stimulates this split, as you can see in Image 6. So maybe this is not the best reference for improving Product Management and Product Ownership in your organization. Instead, take a look at other scaling frameworks like LeSS or Nexus, which promote other, more interesting ideas around Product Management and scaling the organization effectively, while still being Agile.
The better way to implement the Product Owner and Product Manager roles
A much better way to implement the Product Owner and Product Manager roles in the organization is to look at it as follows:
Product Managers and Product Owners are both product people, who both lead and manage products and/or services. They are both ultimately responsible (or accountable if you will) for the success of one or multiple customer-facing products or services. The only difference between a Product Owner and a Product Manager, is that a Product Owner is part of one or multiple Scrum Teams, and they apply the Scrum Framework to design, develop, deliver and market their product. So, both are Product Managers. And these Product Managers could have the role of being a Product Owner in a Scrum Team.
Recommendations for next steps
The following recommendations haven’t been discussed earlier in this article. As trainers and consultants, we have a lot of experience helping organizations to implement a digital strategy, implement Agile and Scrum and to transform traditional organizations into product-organizations. Therefore, we have a couple of recommendations for you to explore in your organization in order to resolve the PM — PO confusion and too boost your Product Management capabilities, as well as your organizations’ success:
- Identify the customer-facing products and services in your organization. If you call it a product, then that product should have (at least) the following characteristics:
— The Product is directly customer-facing (so no internal components);
— The Product is created for (a) specific target audience(s);
— The Product solves a clear customer problem;
— The Product should be able to generate revenues by itself;
— The Product should be marketable by itself (or be its own brand); - After identifying the products, appoint Product Owners or Product Managers. Personally, I’m used to choosing my own job title, so I’d recommend you to do the same. Do want to be called Product Owner? Go for it. Do you want to be called Product Manager? Then do it. It’s just a title… Pick the one you like most. These Product Owners or Product Managers can now start working on the Product Vision and Strategy already (if it doesn’t exist already, or if it needs changing), as well as other product management activities.
- Identify all the knowledge, skills, competences and capabilities you need in order to deliver each of the products or services to your customers. This means that you will need to identify the end-to-end value stream of each your products and services. With this information, you can identify how many people you would need in order to fully service each of these products and services. Be aware: this is not limited to one department! It is a cross-departmental identification-effort, needed to be done for each product. So at the end of this effort, you will know how many sales, marketeers, developers, operations, infrastructure, UX-designers, architects, and so forth you would need.
- Alternatively, you can do the exercise described in step 3 just for one of your products and implement that in practice. This is a more Agile approach for such a transformation, instead of trying to do it all right when you know the least about how it should work right?
- The next steps is the actual implementation. Now that we have a Product Owner or Product Manager per product, bring all the people in the organization together and have them organize themselves into your Development Teams. Again, this doens’t mean “developers only”. We’re referring to the Scrum role called Development Team. This is a cross-functional, multi-disciplinary team, which contains various people who together are able to deliver the product. This means that for some products, you’ll need a lot of teams, and for other products, you only need a few teams.
- Regardless of job titles, most of the product teams should work in an Agile way. They need to deliver value for customers fast, get feedback and continuously improve. So, support the Product Owners / Product Managers and their teams with Scrum Masters or Agile Coaches in order to implement an effective and efficient way of working.
Of course, these six steps are huge. Maybe they’re also just the start… However, many organizations start out with the wrong concepts in mind around Product Owner vs Product Manager. Many organizations have much more Product Owners and Product Managers in their service, than they have products and services to sell to customers… Start right with the basics, and then worry about how to scale it for enterprises. And remember, adding hierarchy or layers is never the solution for scaling! More likely, hierarchy is actually the problem that is making everything all these changes in your organization so hard.
If you want to learn more about this topic then please let us know! You can email us via info@thevaluemaximizers.com. We’re happy yo have a cup of coffee and talk about how to improve product leadership in your organization!
Suggested other readings
- The history of Product Management
- Melissa Perri — Product Owner vs Product Manager
- LeSS — Large Enterprise Scaled Scrum
- Scaling Scrum with Nexus
Go experience the Stances of the Product Owner!
If you’re a Product Owner, Product Manager, Scrum Master or Agile Coach with about a year (or more) of experience under your belt, go and explore the Stances of the Product Owner in the Professional Scrum Product Owner-Advanced class. Find a trainer to your liking or in your area, and deepen and expand your Product Management knowledge and skills. And let us know what you think about the training! What did you like? What can be improved? Let’s collaborate to take the profession of Product Ownership to the next level.
If you’d like to experience the all-new Professional Scrum Product Owner-Advanced class, go to Scrum.org to find a class in your area. If you’d like to participate in one of our classes, check out our Xebia Academy page for more information or inquire for an in-house class via training@xebia.com.
