(2015-10-28) The History And Evolution Of Product Management

Martin Eriksson: The History and Evolution of Product Management. Modern product management started in 1931 with a memo written by Neil H. McElroy at Procter & Gamble (P-and-G). It started as a justification to hire more people (sound familiar to any product managers out there?) but became a cornerstone in modern thinking about brand management and ultimately product management.

What he laid out in his 800 word memo was a simple and concise description of “Brand Men” and their absolute responsibility for a brand – from tracking sales to managing the product, advertising and promotions. Uniquely he outlined that the way to do this was through thorough field testing and client interaction.

McElroy later became Secretary of Defense and helped found NASA, proving all product managers are destined for greatness, but he also advised at Stanford where he influenced two young entrepreneurs called Bill Hewlett and David Packard.

They interpreted the Brand Man ethos as putting decision making as close as possible to the customer, and making the product manager the voice of the customer internally.

Hewlett-Packard had many other firsts – for example they introduced the division structure, where each product group became a self-sustaining organization responsible for developing, manufacturing and marketing its products. Once a division became larger than 500 people it was invariably split further to keep them small.

The original product managers, and indeed the majority of product managers in FMCG (CPG) today, were very much a part of the Marketing function. They focused on the process of understanding the customers’ needs and finding a way to fulfill those needs using the classic marketing mix – the right Product, in the right Place, at the right Price, using the right Promotion.

because of the slow moving nature of the development and production of new products in FMCG (imagine how long it takes to develop and test a new toothpaste, ramp up production and then bring a new brand to market) they focused more on the final three Ps

As the role moved into the tech world however, this separation from the development and production of the product was untenable.

This brought Product Development back to the centre of the Product Management role, as it was imperative not just to understand the customer and their needs, but to align the product’s development with them.

In most tech organisations however, Marketing has evolved to be more about owning the brand and customer acquisition, while Product owns the value proposition and the development of the product.

In 2001 though, seventeen software engineers got together in a ski resort and wrote the Agile Manifesto, building on work spanning back to the seventies on light weight alternatives to the heavy-handed and process-oriented waterfall method of developing software

This focus shift was profound on many levels.

First it changed the relationship between Product Management and Engineering from an adversarial one to a collaborative one.

Secondly, focusing on the customer got rid of the artificial separation between the research, specification and development phases of a project

Finally, these principles have permeated further into the business with the development of lean practices and the development of Lean Startup and Lean Enterprise, which build on the Japanese Kaizen tradition of continuous improvement and apply the agile approach not just to product development but to the business itself.

These days Product Management is increasingly a stand alone function with a seat at the management table and reporting directly to the CEO.

Product Management continues to absorb parts of Marketing, with many organisations making user acquisition a part of product in recognition that good product is often the fastest and cheapest way to grow

it’s something that is become more widely understood and owned within organisations. It’s becoming a discipline in which you may be an engineer, a designer, a founder or a product manager – but all that matters is that you are at the core of the product and passionately work towards the betterment of that product in service of your customers.