Ask A Good Product Manager

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If product managers are CEOs of their products, why aren’t more of them CEOs?

Posted on January 4, 2010 · 6 Comments

Question: If the whole idea of good product management is about effectively being the “CEO of a product,” then why do so few CEOs seem to come from product management?

Answer from Derek Britton, Independent Product Management consultant: I imagine that if you ask 10 people this question, you will get 10 completely different perspectives! Such a diverse array of opinions has already been voiced across the ‘net and in published texts, which tells us this:

  1. it’s a great question!
  2. the answer is quite involved, but is difficult to describe

First, I would agree with the hypothesis that a product manager should be CEO of the product — that’s exactly the behavioral trait they must show to be truly effective and to lead those around them to help the product truly excel.

We must also consider that some “CEO type” activities are beyond the remit of a PM, such as interactions with shareholders, establishing management policies, process, culture, etc. The point here is that to be “CEO” of anything (even if you are really a PM) means you have to assume responsibility for things and lead or influence others to do the right thing for your product. So, for example, as a PM, you want hiring managers to bring in those with the right skills to sell and support YOUR products, you want the sales leaders to focus on YOUR product, you want your marketing team to put the right spin on the collateral, you want your organization’s other product managers to share your vision of the future so you can work together (and not steal resources from one another), plus a million other challenges. By being “the CEO” you will see it as your role, your responsibility, and your opportunity to solve each of them and more — usually through effective leadership, influence and persuasion… and usually by enlisting others in a shared vision, since you won’t achieve it with merely hard work — it must be a team effort.

That’s where this question gets interesting — defining what a CEO “does”. Certainly if we think that all they do is make the big decisions, sort out the funding, hire the VPs, fire the wasters, help on the big deals, then we are missing the role of the CEO entirely. You will notice most of this is just operational day-to-day routine stuff. This isn’t the key bit, though of course it is important. The CEO sets the strategy, establishes and monitors the culture, builds a vision, challenges the process, and (usually) lines everyone up to squarely support “the customer.”

Not much of this is about barking orders; it is about building consensus, establishing a pattern of leadership, and a culture of empowerment. It is about setting a pattern of behavior where others feel like they can and should make changes for the good of the company, of the product, and of the customers.

Not much of it either is about technology or technical prowess on the part of the “CEO.” It is about reaching out to those with those skills and utilizing them correctly. The same is true for a PM — you don’t necessarily need to know all the techie stuff, but you do need to know how it affects your clients, and you need to know who in your “team” you can refer to for the complex technology questions.

But mostly, for me, the CEO role is about understanding what the company exists for, and this is usually based on their customer. A company is nothing without its commercial lifeblood — its client-base.

I think because of this, effective CEOs almost always have a strong commercial background, and are salespeople by trade, and businesspeople and leaders in equal measure. All of these facets are also within a product manager’s remit, but I think the balance is tipped by the typical sales leader’s experience in getting genuine commercial results, which of course is the cornerstone of any organization doing well. Commercial experience also suggests a cost-management perspective too, which is equally important (and why many CFOs are also good candidate CEOs).

There are for sure thousands of other considerations, but an executive recruiter will usually look for evidence of commercial success in a direct capacity for a would-be-CEO to be a genuine candidate. PMs typically don’t have direct authority over revenue in the same way sales guys do, and that for me, boiled down, is the answer to this, because many organizations see revenue as vital and everyone else as secondary.

I would imagine that seasoned PMs with some specific commercial experience would be very much in the running though. The first step for any PM in becoming a full-blown CEO would be to “assume those responsibilities” in their current PM role. This is the acorn from which greater things can grow.

6 other answers so far ↓

  • David Locke // Jan 4, 2010 at 11:32 pm

    Both the CEO and the CEO of the product build and use influence to make things happen.

    Once a product manager is hired, the CEO can focus on selling his own product, the company, to the financial markets.

    One reason why product managers never become CEOs is that being the product manager is a job. Ray Ellison says that MBAs are educated to fit into a job, and not to be a CEO.

    Maybe a product manager can use their time to learn how to influence, but really influence gets demonstrated back in high school. If a product manager doesn’t know how to influence on day one, progress is going to be slow.

  • John Mansour // Jan 5, 2010 at 11:13 am

    The short answer is that “most” PM’s see the market at large through the biased eyes of their products whereas most CEO’s see the market from a much broader perspective without regard to products.

    That said, in today’s product companies, I think the “product CEO” designation for product managers is taking on a completely different connotation than it used to.

    If a company has 10 PM’s, each being the CEO of his/her product line, it often results in ten competing silos with ten #1 priorities and horrifically inefficient use of resources across the board – all to the detriment of the company as a whole. It’s the equivalent of one company trying to function as ten. This has to change if PM function expects to wield more influence!

    The CEO characteristic that must be front and center for the PM function as a whole is LEADERSHIP. We recently published an article on how PM must evolve more into portfolio management if it’s going to remain relevant and strategic. It hits the heart of this discussion. See the article at http://www.zigzagmarketing.com/product-management-2.0.html

  • Raj // Jan 5, 2010 at 11:24 am

    I agree with the point John has made in his comment above. Taking the concept of “Product CEO” literally will likely encourage silos and will end up being a net-negative.

    It’s much better to focus on the concept of “Product Leader” which is much more realistic and productive, while not as attractive as the concept of “Product CEO”!

    Further complicating the concept of “Product CEO” is the fact that CEOs have formal authority, while PMs at most companies have very little formal authority even for the product they’re responsible for.

    – Raj
    Accompa – Affordable Tool for Product Managers

  • John Mansour // Jan 5, 2010 at 11:28 am

    Whole-heartedly agree, Raj. PM’s should always be thinking about exerting stronger influence and not be as concerned with authority.

  • Read-worthy posts this month « Tinkerer's Den // Jan 11, 2010 at 1:18 pm

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  • Stewart Rogers // Jan 21, 2010 at 5:29 pm

    I am thinking that a lot of CEOs were in the trenches before product management really had the attention it has today. It was a much smaller pool of talent to draw from.

    That being said, there are all kinds of factors that breaks the straight line from product manager to CEO. For example, not all product managers want to be CEO. Not all product managers are good enough to be CEO. Not all companies need a product management type as CEO.

    While I do believe the percentage of CEO who were product managers will grow in the future, I don’t expect to see much change.

What do you think?