Product Management Rule #4: Think Like an Entrepreneur
Product Management Rule #4 from the best-selling book, 42 Rules of Product Management, was written by Linda Gorchels, Wisconsin School of Business
At its most basic level, to think like a product manager requires thinking like an entrepreneur.
One of the expectations I received from a product manager during a recent corporate training session was to learn how to think like a product manager. While there are many perspectives and buzzwords that could be thrown at this objective, at its most basic level, to think like a product manager requires thinking like an entrepreneur.
Let’s expand on that a bit.
While people may argue that entrepreneurs have more control over everything than do product managers, the reality is just the opposite. It is the rare entrepreneur who is independently wealthy with easy access to materials, operations, and labor. Most entrepreneurs have a vision for a product or service they are passionate about, but have to find the resources to actualize the vision. They must craft business plans to solicit money from venture capitalists or banks. That’s not unlike the challenges product managers face in developing business cases for new products. The business case is essentially a proposal for an investment of time and resources from the firm. In fact, some firms expect product managers to treat the management team sort of as angel investors who must be convinced of the future value of the product concept being proposed.
After receiving guarantees of funding, entrepreneurs may need to source materials or locate contract manufacturers.
They must work carefully with third parties they don’t directly manage to accomplish the design, development, and commercialization of their envisioned products or services. Similarly, product managers must constantly accomplish their goals through organizational functions over which they have no direct authority. They must use their skills of persuasion and diplomacy to make things happen.
Entrepreneurs often need to work with independent sales representatives or channels to reach the intended market. To help these groups function more effectively, entrepreneurs must provide not just product knowledge but also an understanding of the target markets and the best approach to reach these markets. That’s akin to the challenge product managers face when training and motivating the sales force. There is a strong need to empathize with the needs of salespeople to advance the sales process.
The common link between the entrepreneurial business plan and the product manager business case is clarity of customer need.
Strong entrepreneurs and strong product managers know the profile, needs, emotions, and purchase drivers of their customers. They don’t think exclusively in terms of product features/benefits, but rather how these features/benefits align with customer goals better than competing offerings. They have a strong command of marketing and customer-focused competencies.
Entrepreneurs share several common traits that influence the way they think.
Entrepreneurs embody traits of risk-taking, passion, focus, product/customer knowledge, and tolerance for failure. Strong product managers share these traits (or elements of these traits), which influence their thoughts and decision-making processes.
Let’s carry this analogy one step further. Successful entrepreneurs can grow successful companies. (As an aside, serial entrepreneurs start several companies. Our focus here is NOT on serial entrepreneurs but rather those more focused on a single economic endeavor.) As their companies grow, the passion, focus, and connectedness with the product/customer becomes diffused. That’s where product managers come in. Product managers can restore the passion, focus, and connectedness with the product/customer for their areas of responsibility.
So the bottom line is: to think like a product manager requires thinking like an entrepreneur.