The 6 types of Product Managers. Which one do you need?

 

Catherine (Kit) Ulrich

Eskimos have 1,000 words to describe snow. Marketers have well defined adjectives for their field: affiliate, SEO, content, performance, enterprise. Developers describe their functions and their expertise: front end, back end, java, node.js. And then there is Product, which often starts and ends with a single defining word…product.

Background — The rise of Product:

Ten years ago, Product was barely discussed as a function. Roll forward the clock to today, and product managers are some of the most in-demand talent. Just last year, the WSJ published an article stating that the most coveted post-MBA job is a product manager role (a bit frightening, I admit).

So, what is a product manager? There have been a number of articles outlining the skills of product managers: many write about product as a blend of business, ux, and tech, including posts by Marty Cagan, Martin Eriksson, and this gem by Dan Schmidt. And then there is this classic post by Ben Horowitz and David Weiden on Good vs. Bad PMs.

Credit: Martin Eriksson

Overall, as Marty Cagan says in his book Inspired, the job of a product manager is “to discover a product that is valuable, usable and feasible”.

Why this matters:

However, this broad definition is missing a set of adjectives for the role, Product Manager. The lack of a common vernacular creates a shallow definition for the variety of product people out in the world. And, that lack of definition leads to hiring mis-steps and not understanding the superpowers and kryptonite for each type of product person.

At first, you might believe that this is a large company problem because they can hire multiple product managers, each with their own specialties. But this is even more critical for startups where you must make sure your first hires are the right ones.

The 6 main product manager types:

Superpower: Loves the chase of finding conversion and retention improvements. Might have been a marketer in a past life, blending customer psychology with behavior change tactics. Helps consumers find what they are looking for with the optimal amount of work.

• Kryptonite: Risks becoming addicted to the sugar high of boosting $ at the expense of the overall customer experience. For example, turning off an auto-rebill reminder will likely pop your short-term retention, but could negatively impact long-term retention, refunds, and brand loyalty.
• Example job function: Responsible for optimizing conversion flows from marketing landing pages, pricing, and onboarding. Responsible for driving engagement/repeats by revealing new content or products
• Aliases: eCommerce, Marketing, Performance, Conversion

Superpower: A detective at heart, they can study a customer’s workflow/process and find unique opportunities for improving it. They cut out extraneous steps and optimize every interaction.

• Kryptonite: Assuming users will adopt a new behavior/workflow. Old workflows are addictive because they are familiar; there will often be a switching cost for users even if your new tool is better in the long run
• Example job function: Building editing tools, dashboards, tracking tools
• Aliases: SaaS, workflow
• On a related note: There are also Internal Workflow Product Managers. This flavor of Workflow Warrior loves driving improvements for the functions within a business including marketing, customer service, tech and sales (to name only a few).

Superpower: Understands the psychology behind users sharing and connecting with others. Loves testing ways to drive engagement and deepen connections. In a B2B setting, builds collaboration into a workflow.

• Kryptonite: Focuses on building a vibrant community at the expense of financial/business goals.
• Example job function: Responsible for building the contributor side of a marketplace, driving social interactions in a gaming app, or collaboration for enterprise SaaS.
• Aliases: Social, platform

Superpower: Build it and they will come. Amazing at building services that others (internal teams or external developers) want to use. Typically more technical PMs who understand how to build a service/API.

• Kryptonite: Not understanding that you must also market it. Learning scalable ways to address the variety of use cases or customization of your service.
• Example job function: Manages the development of external APIs and the developer platform.
• Aliases: API, ‘technical’

Superpower: Expert translator between user needs and the problems algorithms or AI /ML models can solve. In the past, this role was commonly a ‘Search PM’.

• Kryptonite: Focusing on technically interesting problems that have low business/customer value.
• Example job function: Improving search success rates and time to conversion.
• Aliases: Search, ‘technical’, analytics, AI/ML

Superpower: Expert at unique mobile use cases, mobile ux/design, and app store processes. Ideally, has a personal relationship with the Apple review team!

• Kryptonite: Believing that understanding mobile is enough. Must build capabilities in one of the areas above as well, because understanding the native ecosystem will be a skill that every PM has in the future.
• Example job function: Leads iOS and Android native app teams
• Aliases: Native, Apps

The product profession has grown enormously over the last ten years and deserves to have a set of common adjectives (probably even more than 6). I look forward to the day when all companies and job descriptions use a common set of vernacular to find the right person!

With these product types, you’ll be able to determine exactly what type of PM your company needs, and what questions you’ll need to ask to find them.

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Interview Questions for the 6 Types of Product Managers

Once you know the skills you need in your product manager, the next step is to ensure you hire someone with those skills!

Why this matters:

What is the biggest mistake a company can make? I’ll argue two things: not hiring when you need to and hiring the wrong person.

The most common challenge we hear at FirstMark — from founders of early stage startups and CEOs of Fortune 100 companies alike — is how to hire well. In numbers, the hiring process takes 4–6 months, with an average of 80 hours spent hiring a single individual. If you hire the wrong person, it typically takes 6–9 months before you know the individual is lacking the skills and have conviction to make a change. Which prompts another round of 4–6 months of hiring. Overall, hiring is simply not very ‘agile’. And it’s not just time you’re spending; poor hiring impacts morale and productivity, and can end up costing your company millions.

Hiring right is critical for every role, but it has particular implications for product positions because they impact the efficiency/effectiveness of other functions (e.g., tech, design), are relied upon to meet business goals, and are usually critical for allowing senior roles to scale up. If you are a founder or CEO, this role will allow you to grow or will pull you into the weeds.

To help you hire right, the first time, here are essential interview questions for each type of product manager.

Words for the wise:

• Start with a classic: What product are you most proud of launching? Which did you learn from the most?
• Don’t be shallow. Go Deep. After asking the questions, dig deeply into each topic and answer. Likewise, if you are the candidate, give specifics. It is easy for anyone to give a high-level textbook answer (particularly in the world we live in where you can Google the best answers). It is hard to fake specific examples from your own experience.
• Ask them to do a case study. Set up the case study as a single question that you want them to answer. The more senior the role, the more open-ended it should be.

The 3 best questions for each type of Product Manager:

• What test has surprised you the most? This is a flavor of my go-to question: ‘what product launch did you learn from the most?’. A Growth Hacker answer should show experience and competency in A/B or multivariate testing.
• How did you measure the success of your tests? Do they just talk about cash? How do they take into account refunds, LTV, price discounts etc.?
• If you saw two designs, one beautiful and one that converted well, which one would you pick? A trick question, but their answer will reveal a lot about their thought process. Do they believe they can create beautiful experiences that also convert? Do they think of conversion as getting clicks or as the entire funnel and customer experience?

• How did you roll-out your product/tool? This question is really a two for one, because it should also tell you how they think through personas / customer segments. Do they discuss existing vs. new users? How did they guide users through changes in their workflow? If they built a new product, how did they think though the best on-boarding experience?
• What are the best workflow products you look to for ideas? Do they think about other workflows their customers use and pull from them vs. recreating the wheel? For example, if their users are in PowerPoint often, do they leverage UX patterns already developed from that experience? Great answers will leave you feeling like the PM is always looking at the details behind every experience they encounter (inspiration can come from everywhere)!
• How do you work with UX/Design? I like asking all PMs this question, but have found it’s even more vital for Workflow Warriors. They need to copy and innovate thoughtfully when improving or creating a workflow. Their answer should indicate true partnership.
• Bonus Question: Have you done immersive user research (sitting with a customer in their natural setting)? Give me an example of what you learned. How did you prepare for and debrief after the session?

• What drives human behavior? This is a white space question with a lot of room for different answers. Personally, I love when PMs answer with a framework that is based on their own insights/reading/education. Do they mention core human needs? Do they raise behavior change and behavioral economic frameworks? Do they bring up examples based on what they have tested in the past?
• Tell me how you have built a community. Look for answers that show a variety of techniques (e.g, ask to connect your contacts, seeding content for debate). Great Community Connectors have a knack for getting people to engage; their answer should have concrete examples with impact metrics.
• Over the last 5 years, how have social networks changed how people engage? Always good to probe whether PMs can not only answer questions about the products they have launched, but also how they fit into larger marketplace trends. For example: using @ handles, greater comfort with sharing overall, use of command terms such as / and #.

• How did you drive adoption (of your service or platform)? Good Platform PMs will give several examples about how they marketed their product. They will include details such as clear documentation, marketing materials, support/feedback mechanisms, methods for providing updates, etc.
• How do you prioritize your backlog / feature requests? Applies to any PM, but this role often has multiple end users who often have competing requests. Probe for answers that offer solutions for how to handle competing outcomes/KPIs.
• How do you address customization for multiple end users? Did they consider an inner source model (open source within an organization)? Code reviews? Good candidates will also discuss how they interviewed internal teams, understood, and then prioritized their needs based on business/customer impact.
• Bonus Question: How do you decide when a service should be outsourced or built internally?

• How do you share customer insights with your tech teammates? I am always looking for examples where the PM actively involves his/her developers with customers. Do they sit in on customer interviews and ethnographic sessions? Do they share customer feedback regularly and as part of a continuous process?
• How do you prioritize your backlog? For this role, look for how they consider technical difficulty vs. customer impact.
• How do you know when you are ready to ship/launch your product? Do they discuss a lab environment, A/B testing tools? This is important because some changes are harder to test due to UX designs launching at the same time as major algorithm adjustments.

• How has mobile changed in the last two years? From how users engage, to iOS updates, to insights on the optimal UX — mobile is always adapting. Look for a Product Manager who is constantly learning and intellectually curious about the space.
• How does IAP work, what are the pros and cons to a business? May not be relevant to every business, but a PM focused exclusively on mobile should understand the basics. Extra credit if they can answer how IAP and Apple’s enforcement policies have changed over time. I like questions like this because they also tell you if the person loves their role. Do they breathe and sleep mobile?
• How do you monitor performance and measure success? For years, mobile A/B testing lagged behind web testing, so I am always curious to see how PMs answer this. Have they used a testing service? Are they talking to customers?
• Bonus: Have you been rejected from the app store? This question usually generates some interesting stories…

Now get out there and hire a rockstar product manager for your team!

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How to predict your competitor’s next move

 

By Emma Parry

Know which competitors matter the most and predict their next steps with greater accuracy.

In this episode of the Inside the Strategy Room, John Horn, author of the new book Inside the Competitor’s Mindset (The MIT Press, April 2023), explains how to predict competitor actions. Horn is a professor at Washington University’s Olin Business School in St. Louis who helps companies maximize the value of competitive insights. He spoke with Emma Gibbs, who leads McKinsey’s Strategy and Corporate Finance Practice in the United Kingdom, Ireland, and Israel. This is an edited transcript of the discussion. For more conversations on the strategy issues that matter, follow the series on your preferred podcast platform.

Emma Gibbs: What is the core message of your book?

John Horn: The big idea is that many companies do competitive intelligence, but where they fall down is in turning that intelligence and data into insights about what the competitor will do. Many of my clients say that their competitors are irrational, but this is because they are not taking the time to look at the world from their competitors’ point of view. Once they do, those competitive actions start to make sense. The book sets up frameworks and processes to help executives get inside the competitor’s mindset.

Emma Gibbs: Why do you think companies have such a hard time understanding their competitors’ points of view?

John Horn: One reason is that we assume our approach and the way we look at the world is right. When someone does something differently, it creates a dissonance with what we think is the correct answer. The other reason is that with more seniority, power, or status comes greater difficulty in being empathetic. We made choices that got us promoted, so we assume they had to be right choices. Any others don’t make sense to us.

Emma Gibbs: Have you come across instances when a company does act irrationally?

John Horn: I have yet to see a company act truly irrationally. Typically, the competitor’s actions aren’t irrational but are moves that we wouldn’t make or we don’t want them to make. I did a war game with a transportation client, and we discussed whether we should include warehousing space as a choice in the game. The client said, “No, because our competitor is irrational with their warehousing. It’s a mature industry with excess capacity and they are adding warehouse space.” I asked, “Have you added capacity in the past 18 months?” He recited a short list: expanding one facility, adding another, acquiring a third. I said, “So you’ve added or expanded 12 facilities. Your competitor added four, and they’re irrational?” He looked at me and said, “Yeah, but there is a good reason why we added those 12.”

Emma Gibbs: How would you approach figuring out the competitor’s reasons for their moves?

John Horn: It’s about breaking out of your own mindset and forcing yourself to look at the world from competitors’ points of view. If I had their assets, what would I do with them? If I decrease my prices and the competitor matches that decrease, I won’t gain any market share. Any time you plan to build a new plant or acquire a company or change your pricing, you should think, as in any game, “If I make this move, what will my opponent do in response?” The minute you say, “They’re irrational,” you stop trying to understand them.

Emma Gibbs: In your book, you have a four-stage framework for understanding competitors. Can you explain those steps?

John Horn: The first step is to pay attention to what competitors say and do by downloading earnings calls or annual reports and scanning media releases. 

The second step is to find out what assets, resources, and capabilities they have. They may have a supply chain in markets or geographies that you don’t have or upgraded facilities. That’s where you start to differentiate the competitor. The way I like to phrase it is, “If I had their toys to play with, what would I do?”

The third step is to consider the person making the decisions. What do you know about them? When someone with a marketing background becomes the CEO, they won’t suddenly start optimizing the footprint of factories. That person will likely focus on marketing to help the company grow, partly because they will think, “My background is why the board hired me.”

"Companies doing competitive intelligence often try to collect all data about all competitors all at once, but they lack the staff or the ability to analyze the information and develop insights. You should start small. Who are the major competitors you want to track, and what do you want to track about them?"

Compa

The fourth element, which is really important, is making a prediction and then tracking it to see how it lines up with what happens. If you paid attention to what the competitor said and did, considered all its assets, and understood the leaders’ backgrounds, you can say, “I think they will do this in the next three to six months.” If what they do is in line with what you expected, you know you are on the right track. If you’re off, then go back and ask, “What did I miss? Maybe they used a certain partner or hired a new person to make decisions.” That updates what you pay attention to going forward to help you make better predictions. The objective is never to be 100 percent accurate, but it’s a lot better to be 30 percent accurate than to be 0 percent accurate in predicting what your competitor will do.

Emma Gibbs: In our practice, we talk a lot about the social side of strategy—ingrained ways of thinking or internal agendas. How should individuals who gather these insights share them with senior leaders so they make the best decisions?

John Horn: It’s more about storytelling than about charts and spreadsheets. It’s hard to say, “Here is what we should have invested, and here’s what the return would have been.” Rather, come up with examples of where the company faced big challenges in the past. For example, it might be something like, “Remember when we entered Latin America and got hammered by that competitor and lost our $200 million investment?” Then go back and look at what the competitor had done before. “If we had spent time to analyze the competitor, we may not have perfectly predicted their reaction, but we could have seen them as a threat and paid more attention to them.” Anecdotes aren’t proof, but you want those big hairy, messy anecdotes to be in senior leaders’ minds, so they realize that this is something they need to pay attention to.

Additionally, when you start implementing a competitive intelligence program, you want to go for small wins to build up the right to get bigger. Focus on one or two competitors and one or two strategic choices; maybe it’s one competitor’s pricing and product portfolio. Then track that and show that you can predict their actions with growing accuracy.

Emma Gibbs: Should business leaders start small when venturing in a new strategic direction, to get a sense of the competitor response?

John Horn: Some strategic choices can’t be made incrementally. If I’m going to acquire a company or expand a facility, I can’t do that partially over time. On the other hand, maybe I can expand a product into a couple of areas and see if a competitor tries to block it. We have this idea that our competitors are tracking our every move and just waiting to pounce. In fact, many will not realize that you are making a move in the market for weeks or months. With big moves, war games and simulations can be very helpful: “Emma, I want you to play a competitor. Here’s what I want to do. What would you do in response?” You can come up with a pretty accurate sense of the competitor response and based on that, decide what you might do differently.

Emma Gibbs: You interviewed people from different backgrounds for the book. What insights did you gain from that?

John Horn: One of the challenges with competitive insight is that you can’t talk to your competitor, so you have to intuit outside in, from second- and third-party resources. A colleague of mine said, “It’s similar to a homicide detective who can’t ask the victim, ‘Who killed you?’” It made me realize that other professionals, such as archaeologists, paleontologists, and neonatal ICU nurses, face the same challenge. Paleontologists can dig up fossil bones, but that doesn’t tell them how T. Rex ran or if it hunted in packs. I asked these different groups how they approach the challenge of not being able to directly interrogate the subject of their research and synthesized their answers into ten lessons. 

The number one thing was to create a diverse team. Almost everyone said, “If you want to have good competitive insight, you need people who look at the problem from different angles, whether that’s cultures, genders, or functional or educational backgrounds. The more people with different voices actively participating, the better answers you will get.”

Emma Gibbs: What advantages can technology bring to getting into the minds of competitors? And how do you combine it with the human aspects?

John Horn: It’s hard to do competitive insight without having a good database of what companies have done in the past and are doing currently so you can see patterns. Competitive insight or business analytics dashboards are very helpful for collecting and codifying that information. When you’re trying to predict your competitor’s actions, you need to know two things. 

First, are they following patterns? For pattern tracking, artificial intelligence and dashboards are helpful as long as AI recognizes the pattern. For example, if I want to know how a competitor will react when I change my prices or when another competitor changes its prices, I have to train the AI tool not only to recognize when the competitor I’m tracking changes its prices, but when others in the industry change their prices. I’m not sure AI has reached the level of being systemic and holistic in tracking multiple competitors relative to one other.

‘Knowing competitors’ historical patterns doesn’t tell us whether those patterns will continue. That’s where the human element comes in. Given what you know about what the competitors are saying and doing, do you expect them to continue those patterns or change direction because they want different outcomes?

The second element, which AI is not good at right now, is predicting changes. I used to do an exercise with my students to prepare them for consulting interviews. It was a consumer goods case, where one company’s market share went from 33 percent to 30 to 27, and another’s went from 27 percent to 30 to 33. The client company stayed flat. I asked the students which company they should be worried about, the one whose market share went up or the one whose market share went down. Most said the one that went up, because that competitor got stronger. I asked, “Do we know that this company wants its market share to continue to go up, or are they happy with where it is? Or did their market share go up without them doing anything and it will fall back because they’re not paying attention to it?” Similarly, the company whose market share went down could continue to go down because the company plans to exit that market. Alternately, its leaders could aggressively try to regain that market share, or they could try to merely stabilize things because they’re focused on other areas.

This shows that knowing historical patterns doesn’t tell us whether those patterns will continue or change. That’s where psychology and the human element comes in. Given what you know about what the competitors are saying and doing, do you expect them to continue those patterns or change direction because they want different outcomes? Technology is not yet good enough to make and track predictions without that human intervention.

Emma Gibbs: On your point about codifying patterns, what information should companies track?

John Horn: It’s a good question because companies doing competitive intelligence often try to do everything. They collect all data about all competitors all at once but lack the staff or the ability to analyze the information and develop insights. It goes back to my earlier point that when you start a competitive insights function, you should start small. Who are the major competitors you want to track and what do you want to track about them? Is it about product innovation, pricing moves, acquisitions, talent management, or supply chain? You figure that out by asking people in the organization where they have seen the competitor surprise or challenge them in terms of their response.

Coming up with a small set of competitors and strategic factors will help you focus the data collection. If I’m focusing on acquisitions, I don’t need to reverse-engineer the competitor’s product portfolio, but I do need to track how often they made acquisitions. How big were the deals? Were they bolt-ons? As you build up that information, you start to get feedback. “That’s great. Can you also look at this other question?” You earn the right to expand the function. It’s similar to the idea of a minimum viable product for entrepreneurs. You start with the MVP, get feedback from the people in your organization, and continue to develop and refine it.

Emma Gibbs: Does John Nash’s equilibrium theory, and game theory in general, play a role in predicting competitors’ moves?

John Horn: The Nash equilibrium essentially says, “I’m going to make the best response in reaction to you, and you will make the best response in reaction to me.” But Nash and the theory of economics always starts from the idea that we want to maximize profit. In the real world, sometimes we are trying to maximize market share in the hopes of getting profits down the road, or to maximize short-term earnings, or to integrate an acquisition as quickly as possible. All Nash would say is, “If that’s your objective, will the competitors have the same response as in other scenarios?” It’s a reminder that we have to consider not what we want other players to do, but what those players will do that’s in their own best interests.

Emma Gibbs: Can you offer some examples of organizations that have effectively generated competitive insights?

John Horn: One financial services company gained support from the CEO. Anytime someone proposed a new strategic initiative, the CEO would ask, “Did you talk to the competitive insight group?” Working with that group became part of how the company did business. The company was also deliberate in ensuring that information flowed up and down throughout the organization.

In another company I worked with, regional managers initially didn’t talk to each other. Since competitors applied similar strategies across regions, there were a lot of missed opportunities. The competitive insights group asked the regional managers to provide information about their main competitors and shared with them information they received from others. When the first reports started trickling in, the managers realized that when a competitor lowered prices in one country, they might lower prices in their regions. The company started small and then created a virtuous feedback loop: “If you want more information, give us more information.” Once you start providing information that helps people do their job better, they will want more of it.

Emma Gibbs: Do you find that companies tend to prioritize customer insights over competitive insights? Are there techniques used for customer research that could be applied to generating competitive insights?

John Horn: I think companies do a better job of understanding customers than competitors. I have led strategy workshops where we asked the client what makes the company distinctive, and the participants said things like high quality and customer responsiveness. The CEO said, “All our competitors would say the same thing, so how are we different?” We have to apply those same empathetic techniques to competitors, as well as supply chain partners and ecosystem stakeholders. For example, why are regulators making the moves they are making? Companies are good at scanning social media to understand how customers are responding to their products, but they don’t apply those techniques to reviewing how customers respond to competitors’ products. What is the competitor’s customer experience score? Are positive or negative responses changing for competitors? That can help you gain insight into what the competitor will do.

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