Skip to main content

Evaluating a Product Manager's Performance

In a previous entry, I argued that companies should not evalute a product manager's performance flatly in terms of product revenue. How should, then, a company evalute a product manager's performance?

One way that Steve Johnson mentions on the productmarketing blog is in terms of the number of on-site visits to prospective and existing customers. The Pragmatic Marketing folks advocate basing bonuses on the number of on-site visits. I believe that on-site visits (in particular, one-on-one interviews) with customers are the single most effective way for a product manager to gain an understanding of the market. I have observed also that companies tend to underestimate their value.

However, I don't believe on-site visits quite get at performance. On-site visits are a means to an end. That end is an in-depth understanding of the market that a product manager successfully communicates to developers, sales, and marcom. If developers, sales, and marcom then do their jobs right, the product will likely succeed.

A company should evaluate a product manager's performance in terms of how well she communicates an understanding of the market to the development, sales, and marcom teams. I propose that a company can measure this performance by surveying the staff of those departments, asking them how well the product manager has imparted information about the market. Ask sales how well the product manager has profiled the different buyers. Ask development how effectively and convincingly the product manager has communicated the requirements. Ask marcom how clearly and credibly the product manager has defined the key messages to use in marketing programs.


Unknown said…
A 360 degree audit is a good idea but don't forget that sales, marcom, and development are often expecting tactical product support rather than market information. I'm not sure I want them determining my income so subjectively.

Here's a thought: what if we bonused product managers on next year's revenue?
Roger L. Cauvin said…
Important points, Steve.

Expect a couple of entries in the future refining the 360 degree audit idea to address the "tactical expectations" problem.

In the meantime, can you elaborate on your idea to bonus product managers on next year's revenue?
Scott Sehlhorst said…
Interesting stuff. I went back and updated an article I wrote about this (from Jan 2006). I do agree with your emphasis on customer engagement.

Popular posts from this blog

Why Spreadsheets Suck for Prioritizing

The Goal As a company executive, you want confidence that your product team (which includes all the people, from all departments, responsible for product success) has a sound basis for deciding which items are on the product roadmap. You also want confidence the team is prioritizing the items in a smart way. What Should We Prioritize? The items the team prioritizes could be features, user stories, epics, market problems, themes, or experiments. Melissa Perri  makes an excellent case for a " problem roadmap ", and, in general, I recommend focusing on the latter types of items. However, the topic of what types of items you should prioritize - and in what situations - is interesting and important but beyond the scope of this blog entry. A Sad but Familiar Story If there is significant controversy about priorities, then almost inevitably, a product manager or other member of the team decides to put together The Spreadsheet. I've done it. Some of the mos

Interaction Design: the Neglected Skill

Your product development organization has a big, gaping hole in it. (Be prepared to feel defensive as you continue reading.) One of the most important roles in product development is the role of interaction designer. An interaction designer designs how the users will interact with the product and conceptualize the tasks they perform. He decides whether, for example, the user interface will be command driven, object oriented (clicking on objects then specifying what to do with them), or wizard based. The interaction designer decides the individual steps in the use cases. Every company has one or more people that play the interaction designer role. Usually, those people have little or no expertise in interaction design. Sadly, they typically don't even realize how unqualified they are. Let's see who typically plays the role at companies. Engineer . An engineer is an expert on building what is designed. Yes, an engineer may know how to design the internal structure of the hardware

Stop Validating and Start Falsifying

The product management and startup worlds are buzzing about the importance of "validation". In this entry, I'll explain how this idea originated and why it's leading organizations astray. Why Validate? In lean startup circles, you constantly hear about "validated learning" and "validating" product ideas: The assumption is that you have a great product idea and seek validation from customers before expending vast resources to build and bring it to market. Indeed, it makes sense to transcend conventional approaches to making product decisions . Intuition, sales anecdotes, feature requests from customers, backward industry thinking, and spreadsheets don't form the basis for sound product decisions. Incorporating lean startup concepts , and a more scientific approach to learning markets, is undoubtedly a sounder approach. Moreover, in larger organizations, sometimes further in the product life-cycle, everyone seems to have an opinio