The space in which your company operates is in perpetual motion.
The abilities of your competitors are constantly evolving, technology is always advancing, and the demands of capturing your users are forever increasing. And within this environment lives your company, with its own fluctuating capabilities and resources.
Many of the variables you'll face are outside of your direct control. But when you operate in a way that responds to your environment, you're more likely to overtake your competitors, capture more customers, and evolve into a mature and successful company.
Here, we take a look at the three stages of a company's evolution—startup, growth, and maturity—and discuss how the environmental demands of each stage impact a product manager's responsibilities.
The startup stage
The founders of SaaS startups are don't just have original ideas—they possess the passion and conviction to turn those concepts into business realities. In an early stage startup, the founder (usually the CEO) is the product master and, consequently, the first product manager in the company.
As the product gains traction, the founder's day-to-day stewardship of the product accelerates. Eventually, as CEO responsibilities ramp up, the combined workload becomes unfeasible. At this point, decision-making slows, capacity for detail wanes, and the business's demands expand. This is the moment in a company's evolution when the first non-founder product manager is hired to take the lead.
The first step for this PM is to get the fundamentals right. This means defining the product's purpose and the company's vision for the future in order to determine which environment the product operates in, where it fits within that environment, and where it should go next.
3 responsibilities of a product manager during the startup stage
1. Understanding the jobs to be done
Lots of ideas get thrown around in the during product development. This divergent thinking is fun, and can lead to brilliant innovations. But in the shaky early stages of a startup, it is also risky and can divert precious time and attention away from the key problem your product is trying to address.
To align focus and invest your resources appropriately, you need to have clarity. This can be achieved with the jobs-to-be-done framework (JTBD): Instead of thinking in terms of products, services, or specific features, the JBTD framework encourages you to get to the heart of what your customers really want. For example, if your product is a productivity tool, your customers don't want another app; they want to maximize their personal time. Once you get your team concentrating on the product's higher purpose, their time and attention will be funneled toward the most gainful opportunities.
2. Building a relationship between the PM and the product founder
No one is going to understand the product better than the person who brought it to life: the founder. They've spent countless hours contemplating its purpose, fit, and future, and will have played out countless ideas and scenarios in their head. The founder's mind is a constantly evolving resource—one that can provide the guidance that PMs need to deliver a cohesive strategy. But when startups move at breakneck speeds, that resource often goes untapped.
Ken Norton, a partner at Google Ventures, recommends that project managers initiate a process called “PM mind melds” to get PMs and CEOs on the same page. The idea is simple: With frequent, private one-on-one sessions, the PM and the CEO can solve problems, set priorities, and hash out the future. These sessions allow a PM to hear everything they need—directly and regularly—to point their team in the right direction.
3. Knowing when to expand
Knowing when to hire is critical. PMs must strike a careful balance between having a team that is small enough to be agile, but also large enough to be prepared for rapid growth.
There are plenty of variables that can affect the best time to hire—such as a PM's experience and the stage of the product's development. But you generally can't go wrong aiming for a PM-to-staff ratio of one product manager per 5 to 9 team members.
The ratio isn't arbitrary—it's based on Amazon's two-pizza rule—which shows that links in communication become unmanageable in teams with more than six members—and on Dunbar's number, which estimates that the maximum number of intimate relationships a human can have is five.
The growth stage
At this point in your evolution, your product is rallying attention: Traffic is on the rise, activation is improving, and your conversion rate is strengthening. The market has validated the product and it is time to grow.
Growth is the process of strengthening your product and establishing your business. Attention might shift from revenue growth to profit, or the focus may turn to aggressive customer acquisition. Either way, growth involves hiring more people—engineers, UXers, designers—making improvements on the back end, and aligning teams.
With growth, change comes quickly, and the business's complexity can expand rapidly. To avoid chaos, PMs need to evolve from day-to-day stewarding to optimizing their team's productivity and focus.
3 responsibilities of a product manager during growth
1. Designing the structure
As teams grow, so too does the difficulty involved in managing them. In order for larger teams to work harmoniously, everyone needs to buy into a methodology for how to get things done. This methodology needs to logically break down the workload and establish clear boundaries of ownership. It's up to the PM to design and champion this structure.
One way this can be done is by organizing teams around customer tasks, rather than code repositories. In ecommerce, for example, the structure may consist of three teams: browse, buy, and support. The browse team is responsible for the experience of finding products; the buy team is responsible for the experience of purchasing products; and the support team is responsible for the support experience including the help, contact, and user account pages.
This method gives teams discrete ownership over an end-to-end experience, allowing them to understand the problem space more deeply and, in turn, design better solutions. The ownership of a specific area can also be motiving and can help create stronger relationships within each team.
2. Designing the process
The fast and nimble process that worked so well in the startup phase will become tumultuous as the team grows. The challenge for the PM is to take the essence of what made the product successful to date, and then adapt it to suit growing and specialized teams. Again, it's up to the PM to design and champion this process.
The best process for your product will be unique to your company and your environment, and it is best optimized with a test-and-learn approach. A good method to start with is the five-day design sprint developed by Jake Knapp. The design sprint involves mapping out a single design problem on Monday and then launching a testable prototype on Friday of the same week. This process fast forwards development at low cost, making it ideal for companies in the growth stage.
3. Strategizing time and resources
In order to scale revenue faster than costs, PMs need to find a way to use their resources efficiently. This can take the shape of supporting asynchronous communication, running effective meetings, and using collaborative tools.
One method for improving time management is to start designing your time, rather than managing it. Thomas Davies, formerly at Google, does this by dividing his workload and responsibilities into four quadrants: team management, business operations, transaction tasks (like emailing), and representative tasks (like CEO mind melds).
This method gives you a high-level view of everything you could spend your time on, which makes it easier to plan and manage your responsibilities. From here, you can see that not all tasks are equal—some have higher product value than others. Once you've identified what those high-value tasks are, you can allocate your time and resources more effectively.
Maturity and the future
Once your product has reached maturity, your users know what they're buying, how your services are used, and what value your product can deliver. At this stage, the growth of your product may slow, but it should never completely stop.
Product management for the future involves continuous experimentation in order to find additional growth opportunities within the bounds of your existing environment and beyond. It's the PM's responsibility to understand that, regardless of how well your product is doing, you’re never done. The PM needs to support a cultural bias toward ambition and a desire for constant improvement.
3 responsibilities of a product manager during maturity
1. Encouraging experimentation
Mature products will eventually get close to peak performance—known as the local maximum—when positive product improvements are harder to come by. This means that in order to grow, you need to find a new and taller peak to climb—known as the global maximum. Finding a new Everest requires PMs to encourage their teams to take risks and run tests that go against conventional wisdom.
Google supports this mindset with their 10x thinking. Put simply, they think about how they can improve what they do by a factor of 10, rather than by the standard 10%. This method challenges them to think in terms of revolutionary change rather than evolutionary change to find the next big thing.
Another way of thinking about experimentation is to view the players your industry as a flock of birds—heading in the same direction, with roughly the same consensus. Instead of following them, you need to become an “antiflock,” whereby you try to get as far away as possible from everyone else in your space. This distance will allow you to discover value that is completely new.
2. Focusing on the experiential design
To really understand the subjective and emotional experience that users have with your product, you need to go beyond thinking about product design—you need to think in terms of experience design. Optimizing for experience leads to users who are long-term advocates, which is a gift that keeps on giving.
To support a focus on experiential design, PMs can leverage Don Norman's three levels of design. This involves optimizing the visceral design, or the perceptible qualities of the product and how they make the user feel; the behavioral design, or the emotions users feel as a result of either accomplishing or failing to complete their goals; and the reflective design, or what the product means to the user on a deeper level.
Designing experiences for emotion is complex and is best suited to the maturity stage because there's extra breathing space to run focused, well-grounded experiments of a more subjective nature.
3. Planning for the long term
PMs tend to get caught up in the weeds of their products, which means they become unaware of how fast the environment is moving around their product. With each step forward, the landscape changes, so PMs need to zoom out and bring the bigger picture into focus for long-term success.
Peter Hinssen suggests that as a PM, you should “spend 10 % of your resources on looking ahead, 20% on making (and reviewing) your plans for the future and 70% on implementing your plan for the next three months.”
Facebook seconds this approach in their Little Red Book. Instead of the classic “five year plan,” they decide where they want to be in six months and where they want to be in 30 years. Then, at each six-month interval, they take another look at where they want to be in 30 years to plan out their next six months.
Facebook describes this method as “a little bit shortsighted and a little bit not. But any other approach guarantees everything you release is already obsolete.”
Evolution is inevitable, growth is optional
Today's SaaS environment is increasingly complex. Product managers and companies are confronted by shifts in market dynamics, evolving customer preferences, intensifying competition, and rising costs—all running parallel to the evolution of their products.
These external factors make it challenging to grow a successful business, but with awareness and continual adaptation, PMs can approach product development in a way that reacts to the stage and the capabilities of the company, as well as the environment in which it operates.