Part 2: Challenges Faced by Product Managers
By: Sofia Carbone, communications coordinator
This is the second part of a three-part series where we explore what being a product manager and marketer means in the context of both a startup and a large organization.
We had the pleasure to host a Q&A panel with Vito Salvaggio, a Concordia University, and MIT Alumnus, who is a veteran in the startup ecosystem in San Francisco. You can read part 1 here, where we discussed…
Salvaggio is very active within the San Francisco startup community and was recently involved in several successful startups like Streetline—the leading provider of smart parking solutions to cities, universities and corporate campuses, and Loggly, a popular cloud-based log management, and search platform.
In this second part, we’ll be discussing Salvaggio’s challenges as a product manager, and the tips and tricks uses to overcome them. Khalil G. Haddad, District 3’s marketing and communications manager, moderated the discussion.
Question: What are the biggest challenges that you face as a Product Manager?
Vito: The biggest challenge is prioritizing requirements. You have a limited number of engineers and dozens—if not hundreds—of potential ideas that are coming from customers and the market. We ask ourselves “what are the most important features engineers could be working on?” That’s the number one challenge of the product management function.
Another challenge is understanding the needs of the sales organization and understanding what motivates the engineers. Sales always needs to know what they can sell today. Engineers want to fix the big problems, they want a long-term road map. How do you balance those two competing requirements?
I would say the top three things product managers need to stay on top of is: 1) prioritizing requirements; 2) understanding the market and making sure you are not out of position; 3) And observing the needs of the constituencies between the needs of sales and the needs of engineers to feel empowered to do new compelling, innovative things. Those are some of the challenges that a product manager faces on a daily basis.
Question: How do you build credibility, especially if you don’t have an engineering background?
Vito: Influence is the single most important skill a product manager can have. You don’t get engineers to do what you want simply because you’re authorized by virtue of your title. You have to build a rapport. They have to trust you and believe you can bring them requirements that the market needs.
It’s challenging in a high tech company if you don’t have a technical background. What I look at when a product manager want to work for me is, are engineers seeking them or are they ignoring them? If you can not be sought out by the engineers, then you have a problem on your hands. If the product manager doesn’t have the respect of the organization, that’s tough.
Question: How can you transition into the role of product manager?
Vito: In my case I got lucky. An easy way is to transition out of business school, usually out of an MBA or a Master Program. Generally, the easiest way is when you’re in an existing organization and you move over to product management. One of the best hires I ever made in my career came out of sales. This person really understood customers’ issues. He spent a lot of personal time understanding the technology, the products and the competitive space. He was very good with people. Migrating within a company to a junior level product management or product marketing position is usually a nice transition.
If you’re technical, you’re an engineer and you want to make a migration, that is easy as well. The more technical the product and the more technical knowledge you have, the easier it is to transition. Transitioning to a product management position requires a good foundation in product and technology.
It’s hard to do for a startup. They’re not necessarily looking for people to migrate from one position to another unless they are growing rapidly. For example, an engineer who is brought on board to do some coding and wants to transition into product management in an environment where the CEO or CTO are the product managers. He can only make the transition if they’ve grown large enough and are ready for a full time product manager.
Q: If you were given two products to build from scratch, but only had the time and resources to build one, how would you decide which to build?
Vito: Generally, we use the General Electric matrix, which is a framework developed by Mackenzie and General Electric. You look at market attractiveness vs. your ability to execute. You have to do some research, and have to assess the opportunity.
If there’s a sufficiently large market opportunity for this product or service ask yourself do you have you the ability to execute on this? Do you have the funding? Do you have the right people? Ask yourself these questions, state the assumptions. What has to be true for each of these options to be a viable successful option? Go test those assumptions. Where is the biggest market and how likely are you, with the resources that you have, the skill sets of your team, and the funding that you have, to execute?
Look at the competitive environment as well. That is part of the ability to execute. Can you out-execute your competitors? That’s going to be critical.
Q: When you have these assumptions, how do you involve your customers in your product direction?
Vito: That’s relatively easy. We talk to the customers all the time, and how you talk to customers is important! Don’t ask them what they want. It’s ok to ask them, but that shouldn’t guide what you build. You have to ask them, what’s the problem? How do they use your product? Observe them use the product. What are their pain points? Then you figure out how to address their pain points, or the limitations you have in the product.
We talk to customers. We are asking what their problems are, what are they trying to achieve, then we think about possible ways of solving the problem.
That’s the product manager with the designer. The designer will create mockups and there are amazing tools you can use, like Invision, that allows you to do mockups that look and feel a little bit like your product. Whether it’s a mobile or web based product. Then go back to your customers and have them test the interactive mockups. Ask them to solve the problem.
Q: When you’re driving product decisions, how do you deal with the competition? What do you look for and and what’s your mindset when you’re trying to build features or your product?
Vito: What I learned at Apple, even then, you didn’t obsess or spend a lot of time worrying about the competitors. Even today I don’t think Apple worries too much about their competitors. What they do is assess with their customers. They are selling to people who have money. Don’t obsess too much about the competition and don’t mimic what they’re doing.
Even in a single product category like ours, log file management, there are many players. Some serve large enterprise customers. We don’t. We serve medium size fast growing customers. That may be a different persona. We may be pursuing a completely different customer. If we are swayed by what our competitors are doing we may miss what our customer need.
Except for the following caveat.
There are capabilities that almost every category has. For example, you can try to build a cell phone today and save money by not putting a front facing camera. You’re probably not going to be very successful. The competitors’ features are relevant only in the base level features.
You need a certain minimum level of performance. Your product must have a set of capabilities. Whatever the product. Beyond that, you need to understand what the customer pain points are for the target market that you’re pursuing. Most businesses can’t target the whole market. Apple has two million dollars worth of revenue, and doesn’t target the whole market. They target the elite, people that have money.
You have to look at your sweet spot. How big is that category? Understand what those users want and built delightful capabilities for that sweet spot. If you are obsessed with your competition, you may try to mimic them and fall short.
That’s the way I think about competitors. You can’t ignore their features. It’s good to be aware, but you must be driven by your target persona in your market segment. If you miss that you will not succeed. It’s possible you’re pursuing a category that has a direct competitor, in which case it can be a race to the bottom. You’re ultimately going to compete on price. That’s why you really need to think about a large niche that’s unique from your competitors. If you’re really going to grow, you need to focus on what your customers problems are and not be too distracted by your competitors.
Question: If you’re a successful product manager working for a big company, what’s stopping you from resigning and starting your own startup? What is your recommendation for a product manager, when is the right time to move out on your own?
Vito: That’s a question everybody experiences. The answer, it’s a lifestyle choice. If you’re a successful product manager, working for an established company, getting a regular income with the typical annual increase and increased level of responsibility, there’s a certain comfort there.
You need to be willing to risk it all, and by all, I mean have no income for a while. If you feel you’re a good leader and people will listen to you and align behind you, and you feel you can attract investors who would be willing to fund your idea, provided that you do have a fundable idea, you have to make a choice.
Product management is an excellent career. It prepares you to be an entrepreneur or the CEO of a startup. You understand the business. There is sales, engineering, support and design. You don’t own any of these skills, but you are a key player in making these people come together and, if you’re successful, lead them even if you don’t have the authority necessary.
You have to be willing to sacrifice. It depends on your financial situation. If you’re used to that income, it can be really hard to be entrepreneur. If you expect certain minimal living standards like the fancy car, fancy apartment or house, you’re going to have to make those choices.
Why are so many successful startups founded by younger people? It’s because they’re at a place in their careers where they have nothing to lose. They don’t have the big mortgage or car payments, and the private school for their kids. They’re willing to say “I can sacrifice for a few years to pursue the potentially bigger goal”. If you’re leaving a successful career at an established company, with a regular salary, you need to tell yourself “I’m prepared to drop all of this and do my own thing.”
We hope you enjoyed the second post of this series! In the final part, Vito will be tackling what it means to be a product manager in the context of a startup. Get the opportunity to meet more VIP guest speakers like Vito Salvaggio, find out the latest initiatives by subscribing to District 3’s newsletter.