Product Management During End-of-Life Phase
From Product Management School
The "End of Life" phase of a product is the natural conclusion to the lifecycle of a product.
All products are eventually superseded by new products in the market or the market moves on to a new technology.
Is the Product in Decline?
The Product Managers role is to determine when the product needs to start being phased out. The normal indicators for the product being in decline are:
- Declining sales
- Loss of Market share
- Cost to maintain the product is becoming prohibitive
- Revenue from the product is minimal
- The product no longer aligns with the businesses goals
These signs are all clearly visible to the Business and the Product Manager via the monthly/quarterly/annual financials for the product that are monitored closely.
The "End of Life" phase should be properly managed like any other phases in the product lifecycle. Unfortunately this does not always happen. This is mainly due to the fact that people find it a hard topic to deal with for various reasons. The fact is that the earlier that the decline is dealt with, the better it is for all concerned.
The decision to discontinue or not is taken at the end of a review process that is documented in the Product End-of-Life Document. As in all other phases, the cross-functional team plays a key role in preparing this document as well as in executing its recommendations.
The Product Manager has to put a great deal of effort into motivating and leading the team in what is the most difficult of management situations.
Typical Exit Steps
Exit steps normally involve:
- Issuing of legal notices to customers, partners and anyone who has a vested interest in the product. This gives the final support date for the product and any disposal information that may be required.
- Issuing of legal notices giving required notice periods for any services that are outsourced.
- The marketing effort is discontinued.
- Distribution channels are narrowed.
- Pricing is often altered to a higher level to discourage new purchases.
The "exit" is not all about the discontinuance of the product but it should also focus on extracting as much profit as possible from the product line whilst carrying out a phased withdrawal.
This could mean:
- selling the product to another company;
- divesting any assets to sell separately; or
- sometimes there may even be a rationale to contemplate a management buyout.
