Product Management

Why Product Operations is the Next Iteration in Product Management

If you ask anyone on my team what I say to them every single quarter, they’ll likely say, “For us to get better, we have to continue to reflect.” They’ll also likely add that the two hour long retro I throw onto our (already packed) calendars at the end of each quarter makes them both cringe and start to prepare for change. But hey, we’re product people, right? Iterating is what we do.

We started product operations at Pendo two years ago in the summer of 2019. Since then, we’ve gone from a team of two to a team of seven. It’s important to note that the company has grown in parallel with this journey. We’ve seen employee count go from 262 to 695, product manager count go from 8 to 15, and our product evolve from two solid offerings to now six major offerings across web and mobile. We also saw the rise of product operations across our customer base, and out in the SaaS world, giving us comfort and confidence that something big was happening in product. 

I often get asked about when to start a product ops function by those looking to stand one up in their own product orgs. Generally speaking, ops teams are born when an organization’s employee or customer count hits a certain number. In the early days, I thought it would be good to bring in product ops managers when our PM count hit at least three, with at least three teams behind them. However, I now realize this may not be the case for every ops team, particularly product operations. 

Today, especially in a world that’s shifting more and more to remote work, there’s one thing I know for sure: If we continue to operate in product management the way we always have, expecting teams to contribute not only to the success of the product, but the business overall, we can’t leave PMs hanging without the appropriate levels of support. 

Reflecting on the origin of product ops

Recently, I was reminded that I personally needed to more deeply reflect on whether this discipline—this product operations idea that emerged in the last few years out of seemingly nowhere—is here to stay. In order to see where we’re going, we need to understand where we came from. And like our friends in marketing ops, sales ops, and CS ops—born out of their division’s needs—we weren’t just born out of some genius marketing idea. 

Product operations was born out of the need to align and empower teams in a world where technology has changed and continues to change everything. We were born from product people and engineers hungry to do more for their customers than they initially signed up for. We were born out of customer-facing teams who knew that in order to succeed, they needed to ingest pain as acutely as a PM and be our boots on the ground to help elevate the voice of our customers. We were born out of the pain felt by companies that were working to truly be product led.

The evolution of product management

I keep mentioning broader reflection. For product operations specifically, I couldn’t reflect on the last few years alone to understand this function’s value and predict where it’s headed. I feel it’s necessary to understand the evolution of product management (and the pain the discipline has solved along its journey) to help us understand where this new role is heading. And through the magic of internet research (including an excellent overview from Mind the Product), I came across information that helped me form the following summary of product management over the decades: 

When Who What Why
1930s Neil McElroy

Procter & Gamble

Wrote his famous memo asking to hire ‘Brand Men’ to manage everything—tracking sales, managing the product, marketing, and promotions, etc. Free up time for sales to focus on selling.
1940s  Bill Hewlett

David Packard

HP

Learned from McElroy and put the PM closer to the customer. Introduced and solidified the idea of smaller, organized teams.  Voice of the customer becomes central to product teams and smaller organized teams can focus on development and growth of specific areas. 
1950s  Taiichi Ohno 

Eiji Toyoda

Toyota

“Just in time production;” Kaizen way of working across the company. Each employee is responsible for helping to grow Toyota. Kanban emerges as a way of managing each stage of production.  Alignment across the organization to continue to improve the company while staying close to the customer and making quick improvements to get to maximum value. 
1960s  The savvy consumer recognizes they have options “Brand Manager” role  becomes increasingly important  Creating emotional attachments to products becomes the norm, and sentiment becomes a piece of information necessary to help with success.
1970s  Product Manager 

Marketing Manager

Recognition of the need to break out separate roles dedicated to product ideation and marketing.  Accountability and focus; Marketing focuses on brand awareness and acquisition/conversion while product owns ideation and evolution.
1980s  Scott Cook

Tom Proulx

Intuit 

Observing customers in their own ‘habitat;’ Follow me home program is born and continues to be the best way to understand customer behavior and pain. Software makes its way into offices and homes, where outside noise and influence impact average usage. Deep understanding of persona behavior becomes core to the PM role.
1990s  Program Manager

Engineer

More companies adopt Intuit’s way of working. Microsoft and other companies have program managers focused on modern-day product management responsibilities.  It’s equally important to speak to customers and developers with confidence. One role gets dedicated to this along with owning planning through to execution. 
2000s Agile Teams  Teams focus on Agile development and depart from waterfall, and requirements documents/specs. Agile Manifesto is born, introducing a new way to work.  Frequent incremental value delivery becomes the most important piece of software management. It also leads to a new problem where internal teams need to keep up with the volume of changes being introduced to customers.
2010s The Data-Driven Product Team A beautiful departure occurs where decisions are not solely based on gut, intuition, or the highest-paying customer.  

Product management gets a permanent seat at the table. 

Data-driven decision making empowers product teams to quickly understand where efforts should be placed and manage resources effectively to maximize outcomes. 

The chief product officer (CPO) is a key decision maker. 

Today The Product-Led Organization Many companies recognize the need for the product to speak for itself in a world where attention spans are limited and competition is everywhere. 

Transparency becomes critical.

Startups and acquisitions are the norm and alternatives are plentiful. Customers expect perfection and speed. 

Customer-facing teams need to be as well-versed in the product as the product teams are.

In short, we went from a place where PMs were meant to free up sales to focus on selling, to being responsible for ideation and engineering alignment. And now, product managers have a clear seat at the table and are responsible for driving business outcomes. 

The modern product manager 

Today, product teams no longer simply build and ship products. Product managers themselves have evolved into leaders who are responsible for driving and contributing to business outcomes. There are two prerequisites that are necessary in order to make this all possible:

1. Product managers need to spend time with customers

When I say this, I don’t mean that they need to spend this time listening to customers rattle off requests and complain. A PM’s passion comes from solving critical problems their customers face. This requires time, energy, and thought. In my opinion, Intuit had it right with the “Follow me home” program. 

I remember the moment I fell in love with product management was the moment I sat with my customer and watched him use my product, then switch to another tab to use another product, and pick up the phone to answer a colleague. He forgot what he was supposed to do with the widget we asked him to use. When he remembered what it was, he asked me why it wasn’t easy enough that he wouldn’t forget it and could have accomplished it while answering that call. He also asked me how the hell I expected his team to use it when his direct reports had a more hectic day than his. Everything I experienced in that moment was necessary for me to understand his day-to-day, and who I was building for.

2. Product managers need to spend time with engineers

PMs are tasked with taking the passion they feel from interacting with customers and insights from the data made available to them and painting a picture beautiful enough to inspire action. Swift action in the form of solutioning, coding, and creating delight is what makes a product manager and their engineer a dynamic duo. Facetime (whether it’s in person or virtual) is crucial for PMs and engineers to better understand how the other person works, stay aligned on priorities, and talk through any concerns or pivots in the roadmap.

Enter: product operations 

Today’s modern product teams ideate, design, execute, solve, iterate, align, and drive. This takes a whole lot of time and energy. Most people can control their energy. None of us can control time. 

So, what happened to all of the other responsibilities in the chart above that product managers were handling? In a lot of cases, they’re still being managed by product managers. But how can we expect PMs to help with goals for new business, retention, and growth while managing other items like the ones mentioned above? Things like enablement and training, managing beta participants, feedback and release processes, driving voice of customer programs, and owning external documentation require thoughtful execution.

This is why we found it essential to establish operational rigor around the product within our organization, through product operations. 

At Pendo, we believe if something is important enough to the business, you put time towards it. And if it’s important enough to find a way to sustain and drive long-term growth, you put a full-time human towards it. As the product management space continues to grow and evolve, one thing is clear: there’s no going back to a world where product teams don’t have a seat at the table. And as the world continues to shift and embrace digital adoption and transformation, teams at the center of these efforts need to be empowered, supported, and aligned to make it all happen. 

Having product operations as part of your toolkit helps modern PMs focus deeply on solving problems and delivering outcomes for your customers, by simply solving some of their own. 

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