Behind Every Great Product

When I first decided to start The Silicon Valley Product Group, I had just left eBay and had some very strong opinions about what makes great product teams, and great product cultures, and while there were more than a few important thinkers and leaders on these topics, one area that I felt was under-represented was the role of product management. So one of the very first things I did was to sit down and write an essay about what I believed about this role. I titled the paper, “Behind Every Great Product” and it was inspired by the classic Good Product Manager / Bad Product Manager by Ben Horowitz. The paper proved popular and helped many teams to get a better understanding of just what product was all about.

Now, more than a decade later, I’d like to revisit this topic. There are three main reasons for this:

First, even though I personally spend a good deal of my time writing and coaching and teaching about product management, there’s little question that there remains considerable confusion about this role. There are multiple reasons for this but it’s simply too important to continue.

Second, I’ve learned a lot in the years since I first wrote about this. I’ve had the opportunity to work with many impressive teams and product managers from a broad range of leading tech companies, and this has helped me to get a better sense of the what is essential to the role, and to success.

Third, I argue that the role is now more essential than ever. I see this role as absolutely critical to success, and very often is the difference between success and failure.

What has not changed is my overarching belief that behind every great product, there is someone, usually someone behind the scenes, working tirelessly, that is playing this critical role They usually have the title “product manager” but they might be a startup co-founder or the CEO, or they might be in another role on the team and stepped up because they saw the need. The title is not important; the work they do is.

There are essentially three ways for a product manager to work, and I argue only one of them leads to success:

They can escalate every issue and decision up to the CEO. In this model, the product manager is really abacklog administrator. Lots of CEO’s tell me this is the model they’re in and it’s not working. If you think the product manager job is what’s described in a Certified Scrum Product Owner class, you almost certainly fall into this category.
They can call a meeting with all the stakeholders in the room and then just let them fight it out – this is design by committee and it rarely yields anything beyond mediocrity. This is very common in large companies, and in this model, the product manager is really a project manager and roadmap administrator.
The product manager can do his or her job.

So my intention here is to show you great examples of this third way of working.

Normally I do this by explaining the critical responsibilities and the necessary character traits and skills, but in this article I will be taking a very different approach. I want to instead introduce you to real people.

Anyone that’s ever worked in product for any amount of time knows that creating products is never easy, but I selected these particular examples to illustrate the very difficult but essential contribution that comes from a strong product manager.

The products are all iconic, and everyone that reads this will know of every product I describe, but few people know the actual product managers behind these products. And fewer still know the back stories behind these successful products.

I don’t think these stories have ever been shared publicly before, and they are stories that I believe deserve to be told.

These stories will hopefully show you several examples of product managers doing their job and doing it well.

WORD FOR MAC – Martina Lauchengco

In 1993, Word 6.0 was the biggest release, feature-wise, Microsoft had ever produced up until then.

In addition to all the new features, the team had another very large objective. Their code base had diverged and it was extremely slow and costly for Microsoft to be implementing Word separately for each platform: Windows, DOS and Mac. This code convergence effort was supposed to save Microsoft substantial development time, and also – they tried to convince themselves – improve the offering since Word would have the same features on every platform.

It also meant that there was great pressure to get the release out so they could start to gain the efficiencies of a single code base.

At the time, Word for Mac was a relatively small market. It was only $60M vs. Windows which at that point was more than a $1B market.

If you remember back then, Windows machines absolutely dominated, and even the future of Apple was not a sure thing.

However, the Mac community was also very vocal, with passionate fans of their platform, and is also important to note that this community had very little love for Microsoft.

PowerMacs were just hitting the market, which had significantly faster chips and more memory. Most of the team were using those new computers because the Word 6.0 beta in it’s early days was just too slow on regular Macs.

Of course, most of the Mac user base was not on new PowerMacs, they were on ‘regular’ Macs — hardware upgrade cycles were much slower then.

So when Microsoft released the most “full-featured word processor ever for the Mac” that crawled on their Macs — we’re talking literally two minutes to startup– the community immediately started posting in newsgroups that Microsoft was actually trying to “kill the Mac.”

Hate mail started streaming in from everywhere – including emails directly to Bill Gates who would forward them on to the team with messages like “this is depressing MSFT’s stock price. Fix it.”

Enter Martina Lauchengco, a young product manager recently out of Stanford, whose job it was to help turn this around.

The team quickly learned that while it may be a worthwhile objective to get to a common code base, it’s an empty victory if the product that results is not good. Moreover, users choose their devices and platforms because they value what’s different, not the same.

From the customer’s point of view, they would rather wait a little longer and have a better platform-specific solution, than simultaneously ship a generic product on all platforms.

The team ended up focusing hard on performance, and taking advantage of what the Mac could do.

They looked at things like when and how to load fonts since Mac users tended to have so many more than Windows users, and ensuring all Mac keyboard shortcuts still worked.

They focused on things like Word Count which is used 10 times a day by every press person to make sure that it was lightning fast, as the press used the feature as their performance barometer. They even made it faster than the feature on Windows.

The result was that in a couple of months, they produced a 6.1 release that was sent to every registered user with an apology letter – signed by Martina – along with a discount coupon for future purchases.

The release succeeded in fixing the perception problems, but more importantly, it genuinely made the version dramatically better for the Macintosh – a product the Mac team could actually be proud of, and what the team felt they should have delivered to market in the first place.

This is a good example of how hard it can be to do the right thing for the customer, often in the face of pretty massive pressures, but that’s exactly what strong product managers figure out how to do.

In subsequent years, not only did Microsoft once again decide to diverge the code base, they completely separated the teams into different buildings and business units, and had them fully embrace all things Mac. Strategically it was a complete 180.

It’s hard to estimate just how important this was to both Microsoft and to Apple. Even today, more than 20 years later, many businesses and consumers consider Word and the rest of Office absolutely essential to being able to use their Mac for business and personal use. What started then became a multi-billion dollar win for both Apple and Microsoft. There are more than 1 billion Macs and PC’s running Office around the world.

Martina has gone on to have a remarkable career, in both product management and product marketing. From Microsoft she went on to Netscape, where she was responsible for marketing of the Netscape Browser, and then LoudCloud, and now I’m happy to say she’s been my partner at SVPG for over a decade, and she also teaches marketing at UC Berkeley.

Let me also add that there’s little as powerful as a marketing person that’s also strong at product. The combination is amazing.

NETFLIX – Kate Arnold

Netflix is one of my all-time favorite products and companies.

But back in 1999, a then very young Netflix based in Los Gatos with less than 20 employees, was on the edge of going bust. They had a couple experienced co-founders, including the now legendary Reed Hastings, but the problem was that they were stuck at about 300,000 customers.

They were essentially providing the same general pay-per-rental experience that Blockbuster provided, just an online version of this. There were, as always, some early adopters, and some people lived in places that didn’t have a video store, but in truth there wasn’t much of a reason to do this via the postal service when you could just stop by the local Blockbuster store. People would rent once, and then quickly forget about the service, and didn’t seem very willing to change. The team knew that the service wasn’t better enough to get people to change.

Even worse, DVD sales were starting to lag, and a Hollywood backlash further muddied the situation. Then there were challenges with fulfillment logistics, difficulty maintaining DVD quality, and trying to figure out how to do all this in a way that covered costs and generated some cash.

Kate Arnold was the product manager for this small team, and the team knew they needed to do something different.

One of many tests they tried was to move to a subscription service. Get people to sign up for a month, and offer them unlimited movies. Would that be perceived as “better enough” to get them to change their media consumption behavior?

The good news was that yes, actually, this really did appeal to people. A flat monthly fee and all the videos they could consume sounded pretty great.

The bad news is that the team created some real problems for themselves. No surprise that Netflix customers wanted to rent mostly newly released feature films, yet these were much more expensive for Netflix to stock, and they would need to stock so many copies of these, that they’d very likely run out of money fast.

So the product challenge became how were they going to make sure Netflix customers could watch a set of movies they would love, yet wouldn’t bankrupt the company?

They knew they needed to somehow get customers to want a blend of expensive and less expensive titles. Necessity being the mother of invention, this is where the queue, the ratings system, and the recommendation engine all came from. Those were the technology-powered innovations that enabled the new, much more desirable business model.

So the team got to work. In three month’s time, the team redesigned the site, introducing the queue, the rating system, and the recommendations engine all in support of Netflix being a subscription service.

They also re-wrote the billing system to handle the monthly subscription model (a funny little side story is that they actually launched without this as they had the 30 day free trial month, which bought them the extra time they needed).

With so many moving pieces and interconnected efforts, the daily stand-ups included just about every person in the company.

Between working with the co-founders on the strategy, validating concepts with the users, assessing the analytics, driving features and functionality with the team, and working with finance on the new business model, marketing on acquisition, and the warehouse on fulfillment, you can imagine the workload Kate faced on a daily basis.

Yet the team got the new service up and running and used this to power and grow their business for another 7 years, until they disrupted themselves again by moving aggressively to the streaming model.

Kate would be the first to credit a pretty amazing team, including some exceptional engineers, and the vision and courage of the founders, but I would argue that without a Kate driving for the technology-based solutions that could actually power this business, there’s a good chance Netflix as we know it never would have happened. This was also a great example of a product manager needing to work across the entire company to come up with not just product solutions but business solutions that work.

One other interesting little aside about early Netflix – when they were struggling for cash early on, they offered to sell themselves to Blockbuster for $50M, and Blockbuster turned them down. Today Blockbuster is in the dead pool, and Netflix is worth over $40 billion.

Kate is now a product leader at Shutterstock in New York City.

GOOGLE ADWORDS – Jane Manning

This next example is a favorite of mine.

I’m sure all of you have heard of Google’s AdWords. You know that this product is what fuels the Google empire. To be specific, AdWords is currently 16 years old, and last year alone it generated well over $50B in revenue.

What I’m guessing most of you don’t know, however, is just how this industry-defining product actually came to be. And especially how close this product came to never happening at all.

The year was 2000, and the hardest part about the AdWords project was simply getting agreement that they could work on it.

The core idea had support from Larry Page, but the idea immediately encountered some pretty strong resistance from both the ad sales team, and the engineering team.

Jane Manning was a young engineering manager that was asked to serve as product manager for this effort to try to get it off the dime.

The new sales team, under Omid Kordistani, was off to a strong start selling keywords to large brands and placing the results at the top of the search results, highlighted as an ad, but still very prominent, much in the style that had been done in search results at other companies, including at Netscape where Omid came from. Sales was nervous that this idea of a self-service advertising platform would diminish the value of what the sales team was trying to sell.

And the engineers, which had been working so hard to provide highly relevant search results, were undersandably very worried that users would be confused and frustrated by ads getting in the way of their search results.

Jane sat down with each of these people to get a deeper understanding of their concerns. Some were just plain uncomfortable with advertising. Others were worried about cannibalization.

Once Jane understood the constraints and concerns she was able to advocate for a solution that she believed would address the issues yet enable countless small businesses to get a much more effective advertising solution. Jane also was able to persuade one of Google’s earliest and most respected engineers, Georges Harik, of the idea’s potential, and he helped to bring along other engineers.

The product solution they ended up with placed the AdWords-generated ads to the side of the search results, so they wouldn’t be confused with the salesperson-sold ads which were displayed on the top of the results.

Also, instead of determining placement based solely on the price paid, they would use a formula that multiplied the price paid per impression with the ad’s performance (click-through-rate) to determine placement, so that the best-performing ads – the ones most likely to be most relevant to users – would rise to the top, and the worst ads would be unlikely to be displayed at all, even if they were sold at a higher price.

This solution clearly differentiated for the sales team, and also ensured quality search results, whether paid or organic.

Jane actually wrote the first spec for AdWords, and worked side by side with the engineers to build and launch.

This is yet another example of how there are always so many good reasons for products not to get built. In the products that succeed, there is always someone like Jane behind the scenes working to get over each and every one of the objections, be they technical or business or anything else.

Jane took a break to start a family and is now back at Google once again, this time helping out the YouTube team.

BBC MOBILE – Alex Pressland

I have to admit to a soft spot for the BBC. They’ve been around for nearly 100 years, but they embraced technology and the Internet relatively early. I’ve seen so many amazing product people have come from the BBC, and many are now all over Europe and beyond.

Back in 2003, a full four years before the debut of the iPhone, a young product manager at the BBC, Alex Pressland, had just finished leading a product effort that enabled the BBC to be one of the first media companies in the world to syndicate content. Most people at the BBC had no idea why this was important or even desirable, but Alex understood that this enabling technology could be used in new and unanticipated ways to increase reach for the BBC, a major part of the institution’s mission.

Because she understood the potential for IP-based syndicated content technology, Alex started searching for new and useful ways to put this technology to use. She began by looking at people in the UK that were not being reached by the BBC’s conventional broadcast media (TV’s and Radios in homes and cars).

One such early possibility she found were city center venues that had these large electronic billboard screens that were capable of video. But she observed that these venues were just playing the same thing you could watch on your television at home, even though the context and audience was very different.

So Alex proposed a series of experiments where she would have editorial teams assemble specific tailored content suitable for specific venues and audiences, and then she would measure the audience reach and engagement.

While this might sound obvious today, at the time this was a very foreign concept to the BBC’s broadcast journalism culture, and there were a long list of obstacles in trying to push the BBC in this direction, not the least of which was editorial and legal.

Editorial wasn’t used to the model where content would be created and then delivered in different contexts. This gets to the heart of the BBC editorial culture, and required considerable persuasion to show why this was a very good thing for both the BBC and for the audience.

Legal wasn’t used to distribution via IP enabled devices. Imagine the stack of content licensing agreements that would need to be updated or renegotiated.

The results of Alex’s experiments and early successes gave Alex the confidence to propose to the BBC leadership a new product vision and strategy which she called “BBC Out Of Home.”

It’s important to note that she did this as an individual contributor product manager.

This work ended up fueling a dramatic shift at the BBC from broadcast content to content distribution, and this work dramatically impacted reach, and soon became the basis for BBC’s Mobile efforts. Today more than 50 million people around the world depend on BBC’s mobile offering every week.

This is not just a story about applying technology to solve problems, but it’s also a story about the power of force of will. Especially with large and long-established institutions, it is never easy to drive substantial change, but this is exactly what strong product managers figure out how to do.

Alex went on from the BBC to have a terrific career at several tech and media companies, and now runs product for Bauer Xcel Media in New York.

APPLE ITUNES – Camille Hearst

I’d love to introduce you to another very strong product manager, Camille Hearst.

Camille was a product manager on the iTunes team at Apple, and as you might imagine with such a disruptive and ground-breaking product, she experienced and learned a great deal during her formative product years at Apple, especially as she was there during the years moving from the iTunes original DRM-based music, to DRM-free, was critical in helping iTunes to become truly mass market.

Moving beyond early adopters into mass market involved many different efforts, some product, some marketing, and some a blend of the two. A good example of this blend was the relationship the iTunes team engaged with the American Idol program.

This turned out to be one of the most dramatic and visible – yet challenging product efforts for the iTunes team.

During 2008, American Idol was a cultural icon – watched by more than 25 million people twice a week, with a level of repeat engagement that was largely unrivaled.

Apple saw in this an opportunity to expose an ideal target market to the power of iTunes and digital music. Not just by selling the music from the contestants featured on the show, but by making iTunes an integral part of consumer’s life.

However, while the potential was substantial, the challenges were significant as well.

The VP of iTunes, Eddy Cue, and others made the business deal, but Camille worked as product manager on many of the integrations to help figure this out.

As just one example, the American Idol program is all about voting, and Apple quickly realized that sales of contestant’s music would very likely be strongly indicative of voting results, and while normally iTunes was designed to show trending music and highlight popular titles, in this case it was important to use extreme care to not influence the voting.

This was obviously critically important to the Idol producers – it would reduce or even eliminate the suspense to learn which contestants would continue to the next week.

The integration also allowed the team to target a very specific persona, and work to drive up engagement with this group. One of the keys was to make it easy to get to iTunes for those that didn’t yet have the app installed.

By tackling these and countless other challenges head on, Camille and her team were able to come up with technology solutions that complemented the American Idol experience, yet also injected iTunes as a key component of fan’s life. This contributed to what was in 2014, before the move to streaming, a roughly $20 billion business.

To me this is a great example of how great product managers work to find creative solutions to very difficult problems.

Camille went on to join the YouTube team, and then lead product at London-based Hailo, and now I’m very happy to say that she’s the new CEO of NYC-based startup, Kit.

ADOBE CREATIVE CLOUD – Lea Hickman

It is worth noting that so far, all of these product managers demonstrated exceptional results as individual contributor product managers — no Director or VP titles.

For startups or smaller companies, often all it takes is a strong product team with a strong product manager, but in larger companies, in truth it usually takes more than that. It takes strong product leadership, in the best sense of the word, including providing a compelling product vision and strategy.

One of the absolute hardest assignments in our industry is to try to cause dramatic change in a large and successful company. It’s actually easier in many ways if the company is in serious trouble and they are feeling big pain, because that pain can be used to motivate the change.

But of course great companies want to disrupt themselves before they’re disrupted by others. The difference between Amazon, Netflix, Google, Facebook and the legions of large but slowly dying companies is usually exactly that, product leadership.

The story I’d like to tell you about here is of a product leader, Lea Hickman. In the year 2011, Lea was leading product for Adobe’s Creative Suite.

She had helped Adobe to build a very large and successful business for itself – on the order of $2B in annual license revenue – with its desktop–based Creative Suite.

But Lea knew the market was changing, and the company needed to move from the old desktop-centric, annual upgrade model, to a subscription-based model supporting all the devices designers were now using – including tablets and mobile in all their many form factors.

More generally, Lea knew that the upgrade model was pushing the company to take the product in directions that were not good for Adobe customers and not good in the long-term for Adobe either. But change of this magnitude – revenue from Creative Suite was roughly half of Adobe’s overall $4B in annual revenue – is brutally hard.

Realize that every bone and muscle in the corporate body works to protect that revenue, and so a transition of this magnitude means pushing the company far outside it’s comfort zone – finance, legal, marketing, sales, technology – few in the company would be left untouched.

You can start with the typical concerns:

The finance staff was very worried about the revenue consequences of moving from a license model to a subscription model.

The engineering teams were worried about from moving from a two-year release train model to continuous development and deployment. Especially while assuring quality. They were also concerned that responsibility for service availability was now going to be much higher.

There were also big concerns on the sales side, it was expected that this transition would change the way the Creative Suite products were actually sold. Rather than a large reseller channel, Adobe would now have a direct relationship with their customers. While many people at Adobe generally looked forward to this aspect, the sales organization knew that this was very risky in that if things didn’t work out well, the channels would probably not be very forgiving.

And don’t underestimate the emotional changes – to both customers and sales staff – of moving from “owning software” to “renting access”.

With over a million customers of the existing Creative Suite, Lea understood the technology adoption curve, and that there would be a segment of the customer base that would strongly resist a change of this magnitude. Lea understood that it’s not just about whether the new Creative Cloud would be “better,” it would also be different in some meaningful ways, and some people would need more time to digest this change than others.

Realize also that the Creative Suite is, as the name implies, a suite of integration applications – 15 major ones and many smaller utilities. So this meant that not just one product had to transform, but the full suite needed to transform, which dramatically increased the risk and complexity.

It is any wonder that most companies refuse to tackle something of this magnitude?

Lea knew she had a tough job in front of her and her teams. She realized that in order for all of these inter-related pieces to be able to move together in parallel, she needed to very clearly articulate a compelling vision of the new whole as greater than the sum of the parts.

Lea worked with Adobe’s then CTO, Kevin Lynch, to put together some very compelling prototypes showing the power of this new foundation, and used this to rally both executives and product teams.

Lea then began a sustained and exhausting campaign to continuously communicate with leaders and stakeholders across the entire company. To Lea, there was no such thing as over-communication. A continuous stream of prototypes helped keep people excited about what this new future would bring.

Due to the success of the Creative Cloud – Adobe generated more than $1B in recurring revenue faster than anyone else has – Adobe discontinued new releases of the desktop–based Creative Suite to focus all of their innovation on the new foundation, and today more than 6 million creative professionals subscribe to, and depend on, the Creative Cloud. Today, thanks in large part to this transition, Adobe has more than tripled the market cap it had before the transition – the company today is worth roughly $50 billion.

It is easy to see how big companies with lots of revenue at risk would hesitate to make the changes they need to not only survive, but thrive. Lea tackled these concerns and more head on with a clear and compelling vision and strategy, and clear and continuous communication to the many stakeholders.

This is one of the most impressive, nearly super-human, examples I know of a product leader driving massive and meaningful change in a large and established company.

There’s no question in my mind that Adobe would not be where it is today without someone like Lea working tirelessly to push this change through.

Lea has moved from Adobe to leading product for a rapidly rising star in our space, a company and product line many of you know and love, InVision.

SUMMARY

Now in every case I just described, each of the product managers went out of their way to emphasize to me just how amazing their team was, and how in no way was the success due to their efforts alone, but hopefully these examples help make clear to you the true and essential contribution of the product manager.

The big points I hope you take away from this are:

1) Product Management is absolutely distinct from the other disciplines. It’s clearly different than the contribution of the designers, so please let’s stop having all the misguided discussions of overlap between those roles. It’s also clearly not a project manager. There is some amount of project management inevitably involved just as there is for all leadership positions, but to characterize this as a project manager is to completely miss the essence of the role. The role I would argue that the product manager is most similar to is the role of the CEO. But with the obvious difference that unlike the CEO, nobody reports to the product manager.

2) Like a CEO, the Product Manager must deeply understand all aspects of the business. The Product Manager needs to ensure a business outcome, not just ensure a product gets defined. This requires a good understanding of the many inter-related parts and constraints of the business – financial, marketing, sales, legal, partnership, service, the customer environment, the technical capabilities, the user’s experience, and figure out a solution that works for the customers as well as the business. But don’t think this means an MBA is required – actually not one of the impressive product managers I described has an MBA – or that you need to have all these skills yourself; you must simply have a broad understanding of how a product can affect a business, and work with people from your team and across your company to cover everything that’s important.

3) I hoped you noticed that in literally every one of these examples, the winning solutions didn’t come from users or sales; rather great products require an intense collaboration with design and engineering to solve real problems for our users and customers, in ways that meet the needs of your business. In each of these examples, the users had no idea the solution they fell in love with was actually possible.

4) Like a successful CEO, the successful product manager must be the very best versions of smart, creative and persistent. By smart I mean using new technologies to reach new audiences or enable new business models. By creative, I mean thinking outside the normal product box of features to solve business problems. And persistent — as in pushing companies way beyond their comfort zone with compelling evidence, constant communication and building bridges across functions in the face of stubborn resistance. Being a great product manager means having extraordinary grit.

5) Finally, I hope you can see that true leadership is a big part of what separates the great product people from the merely good ones. So no matter your title or level, if you aspire to be great, don’t be afraid to lead.

I’ve shown you 6 examples of strong product managers at work as they created products that literally changed the world.

If you want to create ground breaking products at your company, I’m hoping their examples show you just what your job truly is, and what a difference great product management can make to a company’s success.

Behind Every Great Product

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