Case Study

At MIDIOR, when we talk about an organization model, rest assured it’s not about the organization chart. In fact, we encourage our clients to set aside the org chart and think about the functions and people that are critical to the process of commercializing successful products and services. These functions, covering product development, management, and marketing, can occur anywhere in the organization. If you look into your own organization, you may find that these functions are being performed by people who do not have the titles you expect. The challenge for many businesses is that they think about their company in terms of an org chart, as a hierarchy with boxes for reports and managers. In fact, what is most important is that the functions are being performed, that they are mapped against people correctly and organized in a way that is productive for your business.

Whatever form your particular organization model takes, there are product specific functions and cross-product functions that need to occur. The core functions are product engineering and product management, supported by product finance, documentation, product marketing, training, among others, which professionalize the discipline.

Core Product Development & Management Functions

Support Product Development & Management Functions

You may have great product managers or developers, but a professionalized discipline does not exist if there is not a structured process for product financials, product operating models and product roll-outs that covers all the bases.

Choose the right people
Maybe you expect to hear us talking about the optimal organization model, but we have seen high-performing product development and management organizations be structured in different ways for different businesses. Successful product organizations are all about identifying the right people for the roles, not about structuring the functions in a specific way.

Finding great product people is hard. We recommend looking for a hierarchy of personal attributes that are strong indicators of future success and they are more important than years of experience, prior job titles, or educational degrees. When you look for candidates, go past the resume and look for these characteristics, in this order – something we like to call EEIOU:

1. Energy – the best product managers lead by example, have no staff and hold themselves accountable for every aspect of product success
2. Enthusiasm – if you can get someone else excited about their product anywhere in the world, you will get mindshare for the mission
3. Intelligence – knowing what you need to know, having the intellectual capital to think on your feet, understanding how to get things done
4. Organization – it’s all about fit with the culture, or at least the vision of the culture.
5. Understanding – background in the technology, competitors and customer needs will get you off to a quick start. It’s nice to have but not essential for success, which is why we put this last. If you have enough energy to be the last “man” standing, enough enthusiasm to get a rock excited about your product, enough intelligence to know what you don’t know, you’ll be able to figure out the subject matter quickly enough.

A combination of these attributes enables a product manager to succeed in the role as the organization exists today and more importantly, they will hold the vision of where the product or service business will be in the future.

To think about it another way using a military analogy, great product managers are akin to the “special forces” segment of the regular army. In the latter, if a soldier goes down there are others right behind to take his/her place. In special forces, each individual has a critical function and if one person fails, it puts the entire mission in jeopardy.

One last note about career paths. Don’t expect to hold onto the product superstars for more than a few years because they are rarely challenged by moving up the corporate ladder. Unless you can create an opportunity by spinning out a new business or have them take responsibility for a division or an acquisition, these entrepreneurs will eventually move on to run their own companies.

Change the attitude
One of the problems with conventional, hierarchical ways to think about organization models is that they motivate people to think of themselves as reporting to a supervisor or department. A programmer sees him or herself reporting to R&D or “engineering” rather than to the product, platform or even sub-assembly under development. Successful product people view themselves as accountable to a product or platform and running a successful product organization requires aligning recognition and compensation accordingly. This view of the world has significant implications for reward systems and in many businesses we see that promotion polices are not aligned with motivating successful product people. Incentives and recognition must be tied to measurable product success, not to span of control or budgetary responsibility.

Sometimes, we see organizations where the people are aligned with the product or service, but then they shoot themselves in the foot by selecting the wrong manager for the group. Seeking out a stellar product manager from a similar business is unlikely to be the best hire. We find that this type of individual is most challenged by the business of the product and less interested in working with the people. The best way to take the motivation out of a product manager is for the manager to jump in, make the decisions and do the job. We find the best management style for the product group leader is that of a coach; call the play, when the play isn’t working, rework the play and hold the individuals accountable for getting the job done. Come to think of it, maybe that’s why the best coaches are rarely former Heisman trophy winners.

To see how well your PD&M organization measures up, take a crack at MIDIOR’s forty-one question organization health check, click here.

Case Study