The ultimate job of a Product Manager
TL:DR It's not "prioritisation" or "launching products"
We can talk about “prioritising”, “managing expectations”, “scoping features” or “launching products” but none of these are the true jobs of a Product Manager. There are only 2 areas you truly need to care (the rest are consequences of this focus).
1. The difference between “Customer Perceived Net Benefits” and “Price”
2. The difference between “Price” and “Cost”
On the difference between “Customer Perceived Net Benefits” and “Price”:
- Customers perceive the net benefit of your product when they compare it with alternatives and competitors
- The price will be a determining factor to calculate the net value
- You want to prioritise and build features that continuously grow the perceived net benefit
- Your company will pressure you to increase price over time (more below)
- You need to prioritise building things that grow net benefits faster than you need to increase the price
- Which makes the end goal communicating how much better your product is versus competition (and really deliver)
On the difference between “Price” and “Cost”:
- Your company perceives value when their margins grow. It means the product drives more retained cash to the business.
- Cost is easy to grow, price not so much as it scares customers and reduces addressable market
- When you invest in building more product (because you need to increase net benefit), it will cost more to the company (engineering, sales, etc), reducing the margin
- Which means you’ll need to grow price to keep the margin (or increase it even faster to grow margin)
- Or you need to find ways to lower the cost (better execution, scale, etc) by prioritising this type of features
- Which makes the end goal balancing your roadmap between “net benefit creation” features and “cost reduction” features
If you don’t grow the first, customers will give up and choose competitors, which means you don’t drive value to the company.
If you don’t grow the second, your margins shrink, reducing business value, which means you don’t drive value to the company.
The price of not focusing on these areas is, at best, creating a feature factory.