This might seem like a simple question but it is not. There are three possible solutions that are generally implemented. Only one of these is the right way to go as a long-term solution. Sometimes the other two solutions can work over the short-term.
While considering this, remember that the Product Manager has a trifold part to play within an organization. They have to concurrently be a champion of the product; a champion of the customer; and a champion of the business.
Three Possible Solutions
The three candidates for the positioning of the Product Management function are development/engineering; marketing/sales; or as a standalone function. Let’s take a deeper look into the rights and wrongs of placing the function within each of these:
It is true that a Product Manager must understand how to work well with the developers/engineers. They must be able to communicate effectively with them both in meetings and informally. They must be able to communicate requirements in a way that is unambiguous and easily understandable to both development/engineering and customers alike.
As a result, many companies put Product Management under the Development/Engineering department. This is not ideal as:
- Placing the reporting lines into development/engineering tends to mean that the Product Manager role turns into a Project Manager role.
- The Product Manager loses focus on the market place and the customer.
- Instead their focus turns too much to the technical and requirements engineering.
Sound knowledge of marketing and sales is vital for any Product Manager. A Product Manager has to be able to carry out full market analysis; understand the market place; to formulate marketing strategies; to put together sales training; and be able to produce or understand the production of sales/promotional materials. As with the development/engineering team the Product Manager needs to be able to communicate effectively with marketing/sales teams.
However, having the Product Manager report into Marketing/Sales department has a negative impact on the role itself. Product Managers that find themselves in this position often find that:
- They become part of the marketing/sales machine.
- They spend the majority of their time training the sales force; presenting; and demonstrating the product.
- They lose focus on the market place and the customer.
Product Management/Standalone Function:
Having the Product Management function as a standalone department, as a peer to the Development/Engineering and Marketing/Sales departments is the best long-term solution for most companies.
This ensures that the Product Manager is able to take a holistic view of the product. From an independent position. the product management function can form cohesive relationships with both other functions whilst keeping the business goals and customer needs firmly in mind. The Product Management function can be free to strategize for the future; find new opportunities; deliver the product that the customer wants; and align all they do with the business’ goals.
What about Startups?
At startup companies, having the Product Management function as a standalone department can be very hard due to lack of resources available.
In the short term, this can be mitigated by having the right person serve this role – such a person should be skilled across the disciplines of Product Management, Development/Engineering and Marketing/Sales. This must be done with the goal of forming a separate department in the medium/long term as the company grows.