Five factors of successful product managers
Do you and your product teams have the characteristics required for success? The Product Team Performance study has been identifying the characteristics of high-performing teams since 2012. Of the 31 factors found through the studies, I discuss five of the most significant ones with Greg Geracie, principal researcher.
Greg is the CEO of Actuation Consulting, a global provider of product management training, consulting, and advisory services to some of the world’s most well-known organizations. I’ve known Greg for several years, through his work on the ProdBOK book, which is the
The Guide to the Product Management and Marketing Body of Knowledge, as well as our mutual involvement in PDMA and AIPMM professional associations for product managers.
Summary of some concepts discussed for product managers
[2:50] Tell us about the survey of product managers you’ve done since 2012.
It’s a performance study comparing factors of product teams that excel versus those that struggle. We use an independent statistician who conducts regression analysis on the survey data.
[3:15] What’s new this year, in your sixth study?
Approximately 40% of the questions are new, derived from our consulting, Q&A with live audiences, and our sponsor Planbox, who submitted five questions related to innovation. The rest are questions that we’ve been tracking on a longitudinal basis and demographic questions that help us better understand our respondents. Another important change is that when we started the study, it was very difficult to find hard data on the topics that our consultants were interested in; now, after years of research, anyone interested in answers to questions about product management and innovation topics can easily find information from our studies.
[7:37] Who are your survey respondents?
We’re interested in hearing from anyone actively involved in product development. Ninety-seven percent of survey respondents have an active role in creating or enhancing products or services in their organizations, so targeting has been very good. Some additional demographics about our respondents this year:
- 54% are product managers or product owners (higher than the norm from past years)
- other 46% are from a wide variety of roles including development managers, engineers, project managers, UX professionals, and more
- slightly more than half report to a C-level executive or VP
- 51% are in hardware software technology vertical
- 45% are from companies with revenue $50 million to $2 billion, with a strong response in the two other segments we identified
[11:21] The study identified 31 significant factors that successful product teams exhibit, including five factors that are new this year. Let’s talk about one of those five new factors, connecting activities to business strategy.
The study shows that a product team’s ability to connect their daily activities back to the company’s overarching business strategy is highly correlated with financial success. However, only 27% of survey respondents indicated that their product team is able to connect their daily activities directly to the company’s business strategy. Most respondents indicate that their organizations either fail to effectively communicate the company strategy or don’t have an overarching business strategy at all. Sadly, the number of product teams that can connect their daily activities with their company’s business strategy has decreased from 37% seven years ago.
To improve their product and financial performance, companies need to shore up communication and transparency about their company strategy and how product teams connect to it. This will give product teams the context to make better short- and longterm decisions, and it will clarify the organization’s strategic priorities. This will also increase product team members’ commitment to their work efforts as they understand the value of their work.
[17:58] Tell us more about the next factor, accountability for customer satisfaction objectives.
Customer satisfaction is becoming increasingly important to product teams. In 2015, there was no dominant metric that teams were accountable to, but now customer satisfaction is the dominant metric, used by 51% of organizations. Being accountable to customer satisfaction is highly correlated with improved performance.
[21:28] Another factor is stories in the backlog. What did you discover?
Product teams that size the entire backlog of user stories demonstrate higher levels of performance. However, only 17% of respondents size the entire backlog.
[24:11] What did you find out about the next factor, time that product managers spend in the field with customers?
Product managers who spend at least 30% of their time in the field with customers improve the performance of their teams and organizations. Unfortunately, only 11% of organizations enable their product managers to spend that much time in the field with customers. One problem is lack of executive support—leaders must champion the concept and provide financial support. Another problem is that many product managers don’t feel comfortable spending time with customers. Fortunately, interacting with customers is a learned skill that we can train ourselves in.
[32:11] Tell us about one more new factor, using profitability when prioritizing requirements.
Emphasizing profitability as the primary criterion in requirements prioritization processes positively impacts performance. Only 39% of organizations use profitability as a requirements criterion. Profitability is the seventh most used prioritization metric, but it’s the one that’s most closely correlated with success.
Action Guide: Put the information Greg shared into action now. Click here to download the Action Guide.
- View the study at ActuationConsulting.com, PDMA.org or Planbox.com
- Email Greg to get access to past success factors at Greg@ActuationConsulting.com
- TEI 031: 4th Annual Study of Product Team Performance – with Greg Geracie
“If the path before you is clear, you’re probably on someone else’s.” – Joseph Campbell
“Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time.” – Thomas Edison, inventor
Thank you for being an Everyday Innovator and learning with me from the successes and failures of product innovators, managers, and developers. If you enjoyed the discussion, help out a fellow product manager by sharing it using the social media buttons you see below.