Everything You Need to Know About Product Management Process
Behind every successful product is a big idea. And this idea undergoes a lengthy transformation, from being a simple “what if” to becoming a bestseller, like a #1 app in an App Store. But how do you turn your idea into a successful project loved by users? The answer is product management.
It’s not enough to just develop a software product based on your break-through idea, and release it. Before the development process starts, there are many things to handle first - and many things to take care of after the release. In this article, we will walk you through the basics of the product management process.
What is the product management process?
If we address Wikipedia, product management is defined as “the business process of planning, developing, launching, and managing a product or service.” If we answer the “what is product management process?” in simple terms, it is a process of launching a new product (or a new feature) or iterating the one that already exists. By that we mean the whole process from start to finish: from analyzing the initial concept to performing post-launch activities, such as collectio of user feedback and analysis.
It’s interesting that, according to the report, 52% of product managers state that their strategy is reactive rather than proactive. That means, managers react to customers’ feedback and/or C-level executives and adjust the product strategy accordingly. However, a product can also be a huge success if a project manager identifies existing pain points of a user and provides a solution without the user asking for it. We’ll talk more about the ways of defining these pain points a bit later. For now, let’s shift our attention to one of the most popular misconceptions about project management, which is “product management = project management”.
Product management vs project management: is there a difference?
In short: yes, there is. They are two different processes, despite being closely interrelated.
As stated above, product management encompasses all processes related to launching (or iterating) a product. Thus, project management is part of the product management process and fits into the development phase.
Needless to say, project management requires the supervision of a Project Manager who is responsible solely for the internal process of product development and makes sure that the process meets the defined deadlines and milestones. Besides, project managers usually collaborate and communicate mainly with the development and design team, while a product manager communicates with all parties involved in the delivery process.
The benefits of effective product management
Though a product management workflow may be a complex one, it is critical to carefully follow every step of it in order to ensure that the product will meet expectations of customers and the vision of stakeholders. And to emphasize the importance of product management functions, let’s look at their biggest benefits:
- Increased customer satisfaction: by understanding what exactly your customers want, it will be easier to fulfill their needs and hence, increase their loyalty and satisfaction.
- Increased revenue: if a customer gets what they need, they will be ready to buy it - so you will eliminate unprofitable guesswork from your business decisions and will be able to significantly increase revenue by providing relevant products and services.
- Improved collaboration: since the product management process unites different departments and roles, you will be able to identify any possible communication gaps and greatly improve collaboration and communication within your company.
- Better efficiency: with a streamlined and organized process of product delivery, you will be able to improve and increase the efficiency of your internal and external processes by documenting and managing them.
As you can see, the process creates a win-win situation for both the company and the clients. But before getting down to the main product management stages, let’s talk a bit more about the role of a product manager and what kind of skills are expected from this person.
Understanding the role of a product manager
As said above, a PM is a person responsible for the whole product delivery process, from coming up with an idea to analyzing the success of the released product. And since product management involves business, tech, and UX aspects, a good PM has to be well-versed in all three of them.
There are also several different types of PMs, depending on their specific roles and business objectives.
A growth product manager is responsible for the “growth” of the business through improving a defined business metric or goal. In other words, this type of PM expands and grows the business and its success through constant improvement of products and services. This is done by regularly collecting customer feedback and analyzing it with an aim to identify barriers for growth. This manager frequently performs short-term experiments to see what causes a response from customers and is usually very knowledgeable in psychology, user behavior, and advertising.
A technical product manager also strives to constantly improve the company’s products and services, but instead of focusing on external factors (i.e., user preferences), these managers focus on internal factors. That means, they focus on the way products function and on their technical characteristics as well as on security. Technical PMs usually have a solid background in engineering, which allows them to implement relevant improvements and technical add-ons.
Data product managers are working closely with the company’s data, making sure it is properly collected, analyzed, and shared. With the help of the data, these managers help companies leverage the success of their products by understanding areas for improvement and customer behavior and preferences.
The main responsibilities of a product manager
We’ve already said that a PM is responsible for releasing a product in the market and supporting its delivery at every stage of the process. But let’s be a bit more specific here and take a closer look at daily responsibilities of a PM.
Research and market analysis
In order to learn what customers need and what business opportunities exist and await to be discovered, a good PM has to do lots of research. By learning about the current market requirements and trends and about customer needs and pain points, a PM identified opportunities for introducing new problem-solving products.
Development of product vision
While stakeholders, developers, and even users definitely have their say in shaping the final product, it’s up to a PM to develop the vision and strategy and present them to all parties involved. This vision will later be used to outline requirements that the development team will work on.
Remember we said that a product manager oversees every stage of the development process? This means, a PM has to manage all teams and make sure that they follow the deadlines and deliver expected results. While a PM does not manage everyone (i.e., software engineers or graphic designers), this person manages the work of all teams in general, communicating with team leads and checking the deliverables and quality of work. Moreover, a product manager establishes smooth communication of different teams and makes sure that everyone is on the same page and understands what is expected of them.
Marketing and tests
The success of a final product depends greatly on marketing activities, such as PR, market research, and metrics analysis with an aim to define how well the product is received by users. Hence, a PM collaborates closely with marketing and sales teams to create awareness of the upcoming product, promote it across needed channels, and then analyze the success of marketing campaigns.
And obviously, the efficient PM constantly seeks ways to improve the product by collecting and analyzing feedback from customers and considering changing market requirements. In this way, the PM is able to retain the product competitive and relevant for users.
What makes a good product manager?
Obviously, every PM has certain traits and qualities that make them unique. However, there is a set of skills that can be called universal for every good PM.
Due to their nature of work, the PM constantly communicates with the most different people, from tech experts to creative marketing managers. Hence, a good PM has to be really flexible, adaptable and ready to listen to various opinions, consider them, and translate the requirements of one team to another.
The whole process of turning a product from an idea into a valuable and marketable solution is incredibly complex and involves hundreds of activities. And it’s up to the PM to decide what should be done in the first place and what can wait a bit. Thus, it is essential that a product manager has high prioritization skills in order to effectively manage all tasks.
Obviously, you can’t be a good manager if you don’t have a good understanding of a business that you work in. Without understanding the specific aspects of a certain business and industry, it is impossible to create a valuable (or even a revolutionary) product because you won’t know how best to use the available resources and what will work best for your company.
If you are a PM, it is your responsibility to make everything work smoothly - so you need to possess exceptional organizational skills. From task prioritization to resource allocation, your workflow has to be perfectly organized and you will have to constantly juggle the tasks and teams, adapting to changing requirements and conditions.
Tech and design knowledge
While the PM does not have to be a technical or design expert (though it always helps), they need to have at least some knowledge in the domains. This will help them better understand what the development and design teams want to propose and in this way, the PM will be able to evaluate whether these suggestions are valuable to a future product.
The main product manager deliverables
During the process of product management, there are several outcomes that are expected from the manager. Obviously, the manager does not work on these product management deliverables independently and collaborates with different departments to successfully meet a certain objective. And while we will look at each deliverable separately and in more detail a bit later, let’s briefly discuss them below.
A manager first needs to present an idea in a “tangible” and clear form - in other words, to provide a vision. It may come in various forms (a simple walkthrough reviewing the core USPs or functionality or a complex demo), but the goal remains the same. Amd it is: to explain what the product is like, how it is intended to function, and most importantly, why this exact product can solve the problem of a customer.
Report on market and customer research
The development of functionality has to be supported by numbers (and not based on any guesswork). These numbers usually come in the form of marketing reports where the PM outlines the Total Addressable Market (TAM), the expected revenue, the approximate size of the market, etc.
Let’s take a small break and look closer at TAM metrics. The Total Addressable Market value indicates the total size of a potential market, if every customer, interested in a product, buys/uses it. It is important to note that TAM does not indicate the expected revenue for your company only, but rather shows how big the potential market. And if you want to calculate TAM, it’s pretty simple: calculate the Average Revenue Per User (ARPU) times the total number of potential customers in the market.
Strategy and roadmaps
Another important deliverable is the strategy and roadmaps. A strategy is the next step after a product vision and answers the question “How are we going to get there?”. Together with the strategy, a manager has to present a roadmap. The roadmap is a high-level document outlining the main milestones to achieve, main stages of the development process, and the ways how the vision matches business objectives. It also features time periods defined for the achievement of certain goals and people responsible for the assigned tasks.
To successfully design a software product, it is critical to explain to the development team what you expect and need from them. But you can’t use marketing language with techies, so a manager needs to present a list of project requirements that the dev team will later work with. This list can feature functional and business requirements, and you can think of it as a vision, translated into a technical language. Requirements help the development team better understand the vision and the way the product is supposed to function. As a result, there happens little to no misunderstanding during the development phase.
Reports on execution
It is critical to evaluate the development process at every stage and thus, reports on execution will be another deliverable. These reports typically involve metrics, such as results of A/B testing or User Acceptance Testing (UAT), and help understand whether the product needs fine-tuning and in what exact areas. Thus, it is the responsibility of a manager to collect this data and present it to the stakeholders in an understandable format.
Reports on testing
One more thing that a PM keeps an eye on is testing. There is no need to say how important testing is for a product because even the smallest glitch can lead to significant security issues in the future. And obviously, testing helps identify potential flaws and issues at early stages and eliminate them before the product is presented to users. So together with execution reports, a PM also creates reports on testing activities to monitor the quality and security and to timely apply needed changes.
The success of the intended product greatly depends on the way it will be promoted. After all, no matter how amazing and valuable the product is - if nobody hears of it, customers will simply not be able to discover and buy it. Therefore, a PM is the person guiding marketing and PR activities and presenting the corresponding marketing strategy as one of the deliverables.
Reports on metrics
After the product is launched and customers start using it, the work of a PM does not stop here. The final deliverable will be reports on performance, such as user bounce rate or a number of purchases within a certain segment. Such metrics help everyone understand how well the product is performing and whether it needs any adjustments to better meet the customers’ needs.
Understanding core steps of the product management process
Finally, we’ve gotten to the most interesting part - the actual product management process. While it will be unique for every organization, the main stages of product management remain the same (though slight alterations are possible). Also note that these stages correlate with the product management deliverables described above, so now we will focus on the details of every stage and on activities that it involves.
When planning the launch of a new product (or enhancement of an existing one), you can’t just randomly think of something and then force it to users. Every development process starts with the definition of a “problem”, also known as a user’s pain point.
But the idea does not come from nowhere. It starts with the “why”: why does the user have a specific problem and how can we solve it? In order to determine that, the manager communicates with stakeholders and involved teams to discuss potential solutions. During the process, the vision is formed and will later be used to define the strategy and roadmaps. However, you can’t form the vision based solely on the opinions of your colleagues. This is where market research and related activities begin.
If you want your product to be relevant and profitable, you have to make sure that you offer it to the right users and that it fits their needs. The first step towards that is to create user personas.
A user persona is a super-detailed description of your perfect customer: starting from general demographic info to what kind of breakfast they prefer on weekends. But why do you need to go into so much detail?
The thing is, the better you understand the motives, needs, expectations, and wishes of a certain user group, the higher the chances are that you will offer them a valuable product. You will use the created user persona to select the needed functionality and prioritize features based on the value they provide. But obviously, when working on user personas, do not forget about your real users. This brings us to the next point.
Market research implies the collection of information about potential customers, competition, the state of the market, and existing alternatives. It is a critical step of the development process as it sets the direction for further work and serves as a base for all product-related decisions.
The market research can be primary and secondary and in your work, you will use both approaches. Primary research means that you collect the information by yourself and it can be done via:
- Surveys (offline and online)
- Focus groups
Note that the primary research can also be quantitative or qualitative. In the case of quantitative research, you will collect numerical data that will answer the “how many” (and similar) questions. In case of qualitative research, you will collect information that will help you understand the motives behind the users’ actions.
As for the secondary research, it means the use of already existing information. It can be journals, published white papers and reports, or surveys by other companies. The point here is that somebody has already done the job, and you only have to research it.
Defining the strategy
The next step of the product management process is defining the strategy. Though some may confuse vision with strategy, they are not the same thing (though they are closely interrelated). If a vision explains towards which direction the company should head, the strategy describes how exactly the team will get there and what milestones it will achieve at every stage of the way.
The strategy is also more defined and detailed and describes the core features of a product, key KPIs to achieve, and exact user needs that are to be met. A critical component of the strategy is a roadmap - let’s look at it in detail.
A perfect roadmap: what is it and how to create one?
As we already defined above, a roadmap is a high-level document that outlines the main milestones and development stages. It normally features functionality, time periods needed for achieving set goals, status markers for progress tracking, and various metrics for measuring success (i.e., bounce rate).
Keep in mind that there are different types of roadmaps, so you’ll need to choose the one that aligns with your current project. For example, there are visionary, technology, and platform roadmaps - each having its own purpose and a set of features.
Now, how do you create a roadmap? The good news is that there are many available tools out there that are designed specifically for roadmap creation. Examples are:
- Roadmap Planner
And there are many other alternatives - just do a bit of research and see what tool would fit your project the best. But obviously, all these tools should be customized for your specific project - so here are the main steps of creating a great roadmap:
- Define your vision and audience: this information will help you understand what type of roadmap you need and what kind of content you will use.
- Select a roadmap format: as said above, a roadmap can be visionary, marketing, technology, etc. You will need to choose the one that would help a certain team achieve their goals. For instance, a feature-based roadmap would be a great aid for your development team.
- Select the metrics to track: a roadmap helps you monitor the progress and status of your product, so you will need to include them in the roadmap (but select these metrics first!).
- Select the roadmap creation tool: do a bit of research on the available options and see which product best meets your needs.
Developing the product
Now, to the most fun part of the product management process - the actual creation of the product. For that, you will need to:
- Select the tech stack, meaning, tools and technologies to use;
- Assemble a project development team by defining which roles are needed;
- Assign a project manager to handle all managerial activities and ensure that everything is delivered on time;
- Establish regular reporting processes and deploy project management tools (i.e., Jira) to effectively track the progress of the development process.
As for the development process itself, it usually consists of the following stages:
- Collection of requirements: the requirements collection and definition happens beforehand, so the team already has ready requirements to work on.
- Design and architecture: designers work on creating low and high fidelity mockups and prototypes to show how the final product would look and function. Also, this stage involves creating the architecture to define how the components will interact with each other.
- Development: the process of writing code and testing it in parallel. During this stage, iterations and changes may take place, and it’s important to manage them properly and to maintain the focus on the core and most important features.
- Testing: after the product is completed, the team will perform an all-round testing to ensure it looks and functions exactly as intended and that there are no bugs, issues, or glitches.
- Support and maintenance: after the release, the team may continue to work on it by implementing improvements and providing needed maintenance in case any issue occurs.
Note that the process described above is a very rough explanation of the software development process. In our blog, we have a series of articles dedicated to IT vendor management - see them for more information on the topic.
To MVP or not to MVP
When creating a software product, you always want to know whether it will be successful and whether users will love it. Well, there is a way to find out without spending astronomical amounts, and MVP is its name.
The MVP term stands for a minimum viable product and is loved by startups for its low-risk approach, moderate investments, and great value. You can read about MVP in more detail here and meanwhile, we will walk through the main things to remember.
The main goal of the MVP is to test your idea and collect feedback from users before you develop a full-featured product. Hence, an MVP can be defined as a product version with a minimal set of essential features (without any fancy add-ons) that is tested by early adopters. In this way, users test only the core functionality and the overall product idea. Based on their feedback, you will then adjust the product as needed and only after its main concept is fully approved by end users, you can start working on additional functionality.
The main benefit of the MVP is that you spend money only on developing a product carcass, so there are not too many risks involved. If users love your product - great, keep working on it and be sure that it will bring you profit in the long run. If users don’t like it - that’s fine, because you did not invest too much time and money into it. Note though that the selection of features for the MVP can be tricky: it’s easy to overload it or forget the essentials. But don’t worry - we have an article to help you with MVP feature prioritization.
The next stage of a product management workflow is testing. In our blog, we’ve written numerous articles on testing: manual vs automated testing, pen testing vs vulnerability assessment, unit test coverage, and more. So we won’t go into too much detail here and will cover just the basics.
Testing is vital because it’s the ultimate way to ensure the security of your product and that its looks and performance 100% match the vision that was defined earlier. And while you can perform testing throughout the development process, you will also need to perform certain testing activities after the product is complete. Here, we talk about testing the way a product appeals to users and these are the two main methods to do so:
- A/B testing: as the name implies, you test A against B and see what users prefer more. In other words, you present users with two features and see which one causes the most engagement and response. You can use A/B testing to test basically anything and it’s a really easy way to understand what attracts customers.
- User acceptance testing: also known as UAT, this form of testing implies creating real-life conditions for a product and test how well it will perform and what kind of issues users will encounter. This testing type is highly useful in identifying any flaws that may have been overlooked during the development and that might negatively impact user experience.
Your product is developed and tested - now it’s time to finally release it in the big world and let everyone know about it. And the biggest mistake that many people make is thinking that this is when your marketing activities start. Wrong - your marketing starts way before the product is even completed in order to “heat” the users, create awareness, and grow interest so everyone knows when and what is coming to the market.
So what does marketing consist of in the product management process? We can define three main stages:
- Creating awareness: includes all sorts of promo activities aimed at educating users about the upcoming product and creating buzz. Examples would be the use of various social media channels to advertise the product or pre-launch giveaways and activities. The main goal here is to make the users want something that is not even out in the market yet.
- Defining pricing: it’s a bit tricky since you want the product to bring profit yet don’t want it to stand out of the competition too much in terms of pricing. After all, if the alternative is 3X cheaper, why would users buy from you? Hence, the definition of pricing calls for thorough market research.
- Choosing the release time: same as with pricing, your release timing will heavily depend on the competition (and how well it performs), market conditions, readiness of users to buy your product, and similar factors. Release timing can make it or break it, so you really need to invest some time and effort into choosing the right one.
During all these stages, the manager will work closely with PR and marketing teams to ensure that all needed activities are performed on time and all goals are delivered as expected. In other words, the PM will track the success of a new product - but how exactly is it done?
Keeping an eye on the metrics
Numbers are your best friends when it comes to evaluating the product's success and user behavior. Seems strange, right? To use dry numbers to evaluate something as ethereal as one’s thoughts. However, it’s working, and various metrics are the #1 indicator of whether you are doing the right thing (or not).
There are various metrics that a PM will use:
- Financial metrics: used to evaluate revenue and the most popular one is monthly recurring revenue (predictable returning income / month);
- User engagement metrics: retention rate, churn rate, bounce rate, and session duration - all these metrics clearly display how interested users are in the product;
- Popularity metrics: display how often users use the product, best evaluated with a sessions per user metrics;
And this is not the end of the list. However, remember that after collecting the metrics, it is critical to analyze them and draw valuable insights and conclusions. It’s not enough to just create a pretty report filled with numbers - make these numbers work for your benefit.
Production manager tools
As you can see, the product management process flow is a lengthy and complex process, filled with the most various activities. And as we already said, it’s a good idea to use ready-made tools designed specifically to facilitate the job of the PM and to make the processes more efficient through automation.
Here are the main types of product management tools to choose from:
- Communication: tools that are used to keep the communication centralized and transparent between all involved parties. Examples: Slack, Gmail, Outlook.
- Issue-tracking: tools used to track all issues and their statuses, assign people to certain tasks, and monitor the overall progress. Examples: Jira, Bugzilla, Trello.
- Marketing: tools that are used to conduct customer surveys and collect user feedback. Examples: Usersnap, SurveyMonkey.
- Business intelligence: tools for analyzing massive amounts of data and drawing valuable insights from them. Examples: Tableau, Qlik, Power BI.
- Roadmapping: tools used to create roadmaps during the strategy definition. Examples: ProductPlan, Wrike.
Product management is an incredibly important and complex process that has to be approached with a great deal of planning and organization. Obviously, when you plan the product delivery and release within your specific organization, you will fine-tune the above mentioned steps to your particular product management process. But we hope this article will help you plan your next product delivery and will serve as a framework that you will be able to effectively use and adjust as needed.
Q: What is product management process?
A: It is a process of launching a new product (or new features) or iterating on an existing one. The process encompasses several stages, starting from forming a product vision to marketing activities after the release.
Q: How does the product development lifecycle fit with the project management process?
A: The development process is part of the product management process and implies the actual creation of a software product. During this stage, you can also perform testing to detect vulnerabilities at an early stage.
Q: What is process automation in product management?
A: Process automation in product management implies the use of specialized tools that automate several processes and thus significantly facilitate and optimize the overall workflow. These tools differ by type and can be used for various stages of the product management process.
Thanks for sharing these tips! I will definitely be implementing some of these strategies.