MaRS Library Managing your lean startup’s product | Part 1: Product management 101
This article is aimed at founders who want to understand the scope of the product manager role and how to effectively manage their product in the initial stages. The article is an update to Product management and the product manager and explains the role of a founder product manager in a startup using lean principles.
The role of the product manager in a technology company has changed dramatically over the past decade. As lean and Agile methodologies have become popular, the role has evolved from defining the target market, gathering requirements and documenting them for development into being more of a facilitator within a team approach to solving market problems.
Understanding this role is especially important for startup founders who need to decide what to build first and how to get to product–market fit as quickly as possible.
Why does product management matter?
Lean startup founders often take on the role of the first product manager, but lack experience with a structured approach to product management. They face challenges in understanding the scope of the job and how to effectively manage their product in the initial stages.
Knowing the best practices of product management helps founders avoid many of the mishaps and the wasted time that come from trial and error.
Understanding the scope of product management
Product management focuses on the success of the product by managing the intersection of business (goals), technology (development) and UX (design), as shown in Figure 1. The main objective is to develop products that create value for the business, are feasible to build and delight customers.
In startup ventures, product success depends on a rapid process of customer discovery and experimentation that deepens problem understanding and sets the stage for innovative and effective solutions. By using a methodical and iterative approach to product management, founders can reduce the risk of building a product no one needs or wants.
There are many frameworks for product management. One of the most popular is Pragmatic Institute’s framework (shown in Figure 2), and it reveals a scope of activities that extends from strategic (on the left) to go-to-market execution (on the right). Some of these activities may not be relevant to every startup, but the framework is helpful to make sure important ones are not missed.
The biggest challenge for every product manager is to focus on the strategic activities that set the stage for effective execution. This reduces the number of urgent issues that take priority in the absence of strategy (a.k.a. reactive firefighting).
As an organization scales, product managers and technical product managers focus on the left-side activities, and product marketing concentrates on the right side with the go-to-market activities.
Effective product management begins by defining and prioritizing the problems or needs of a target market before working on possible solutions.
As legendary Harvard Business School marketing professor Theodore Levitt put it, “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”
A product manager, in this case, first seeks to understand everything about the problem of making the hole, such as:
- The speed at which the hole is made
- The accuracy of the cut
- The safety of the device that makes the hole
- The ease of using the device
- The reliability of the device
- Where the device can be purchased or accessed
- The price of the device
- After-sales support of the device
With this understanding, a product manager then works with their product team to figure out innovative solutions that will best solve the problem and move toward product–market fit.
What is product–market fit?
In 2007, Marc Andreessen wrote, “Product–market fit means being in a good market with a product that can satisfy that market.” For startups, he said, “the only thing that matters is getting to product–market fit.”
Today, product–market fit may not be the “only” thing that matters, but it is critically important for a startup to validate the market before focusing on growth and scale. Without validation, premature investment in growth significantly increases the risk of failure.
For lean startups, the main challenge is to understand the problem space and solution space and to accelerate product–market fit as much as possible. In his popular book The Lean Product Playbook: How to Innovate with Minimum Viable Products and Rapid Customer Feedback, Dan Olsen provides this diagram (Figure 3) to illustrate the stages in defining the problem space and the solution space.
Then craft your value proposition. Product–market fit is all about testing that the value proposition addresses the underserved needs. When it comes to building a product, feature sets and UX have to support the value proposition.
Putting product management into practice
Building a successful product in a lean startup requires a process with three phases: discovery, solutions and delivery.
Engaging, interviewing and understanding the needs of prospective customers in a target market is unquestionably a product manager’s most important activity. The objective is to discover problems that need to be solved for a market segment, not just one customer. This is done through a combination of qualitative and quantitative activities, such as user research, face-to-face interviews, observation, surveys, personas, user stories, jobs to be done and journey maps.
With the inputs from the customer discovery phase, the product team now has a much deeper understanding of the problems, is able to prioritize the business value of solving them and can brainstorm a variety of innovative solutions.
The team will iterate through a set of experiments that prototype, test and then apply what was learned to further experiments until they have validated and prioritized the solutions.
Now the product manager has a detailed understanding of what needs to be built and can write the product requirements for the development team. It is then that team’s responsibility to determine how the solution will be built.
When the team has settled on the best solution for the problem, the requirements are added to a prioritized backlog for development, testing and the push into production.
Product management best practices help accelerate product–market fit
In a lean startup, a disciplined approach to product management helps eliminate much of the uncertainty and risk that founders face. By implementing best practices, founders can accelerate product–market fit and their company’s readiness to hire its first product manager.
Where do founders typically face difficulties?
Lack of experience with formal product management often leads to an ad hoc approach when a startup most needs to accelerate product–market fit.
These three tactics will help lean startup founders avoid common pitfalls when taking on the product management role:
- Start with customer discovery to fully understand the market problems.
- Prioritize the problems and brainstorm hypothetical solutions.
- Run experiments to validate hypotheses and learn the best solutions.
- Pragmatic Framework created by the Pragmatic Institute
- The Lean Product Playbook: How to Innovate with Minimum Viable Products and Rapid Customer Feedback by Dan Olsen (2015)
- Inspired: How to Create Tech Products Customers Love by Marty Cagan (2017)
By Lee Garrison
- Clinical trials and Good Clinical Practice (GCP).
- The cost of product requirements in a new product release.
- Building a business: Fixing those things that may go wrong.
- Defining your target product profile: Medical device products.
- Product management and development as your tech product and market mature.