The product manager role is demanding and complicated.
- "The Product Manager," Jeffrey Bussgang, Thomas Eisenmann, Robert Go
Our case mix in LTV was heavily weighted towards consumer Internet startups, with the expectation that the lessons we learned would be broadly generalizable across other business models and industries. I think this has been largely true, but I think product management in B2B firms offers several unique challenges and requires some different skills than are required in B2C. Our discussion of OPOWER touched on some of these challenges, which I believe mostly arise because:
The User Isn't the Customer.
In the majority of our case discussions -- and in most B2C plays -- the person buying the product and the person using the product are either the same or closely aligned. This was true even for B2B ventures like RentJuice -- realtors who would actually use the product on a daily basis were the key decision-makers in RentJuice's selling process.
When the user is the customer, there is (at least in theory) a direct correlation between solving your users' problems and selling your product. But in many B2B purchases, the Decision-Making Unit is larger and may lack perfect alignment about what features are desirable. Sometimes critical decision-maker will not actually use the product at all!
This past summer, I was a product manager for a cloud-based medical records application. The app's primary users were doctors and nurses, who generally held very strong opinions about what features were desirable in a product they used for hours every day. They cared a great deal about qualities like design and ease of use. But the product was usually purchased by C-level executives at medical practices or hospitals, who cared far more about things like the cost of on-boarding new doctors.
Which of these desires gets prioritized? And who is the real customer here -- the people who use the product or the people who decide to buy it?
Balancing the needs of multiple constituencies can get even more complicated when:
The Customer Wants Conflicting Things.
Clearly different types of users desire different things from a product -- my former i-banker friend wants Excel to work as fast as possible with no visible user interface; I want Excel to walk me through creating pivot tables and most charts with a wizard. Excel can probably satisfy both of us by creating customizable preferences, which my i-banker friend can tweak appropriately.
But sometimes different types of users want things are orthogonally opposed.
A startup founded by one of my friends launched a web-based timesheet application (think Kronos). He has continually encountered variants on a single tradeoff: hourly workers want a timesheet that is simple and quick to use, but accounting departments want a timesheet that is complex and detailed.
My friend has done some really cool things with technology to try to make his product generate rich reporting with little input from hourly workers. But figuring out what ongoing improvements would be desirable frequently becomes a delicate balancing act.
To be clear, I don't think this challenge is unique to B2B -- we've studied consumer-facing firms that managed several-sided markets or diverse sets of stakeholders (Rent the Runway and Mochi Media, for example). But I think the use cases/user stories in B2B products lend themselves to conflict and compromise far more often than in B2C settings.
One reason: businesses often "hire" software to mediate interactions between different internal functions/groups. If these groups were completely on the same page to begin with, they probably wouldn't need sophisticated software to manage their interactions.
So What?
I think the upshot is that product managers in B2B settings face particular challenges in channeling the voice of the customer. I've focused this post on enterprise software because it is an area of personal interest and familiarity, but I think similar problems arise for PMs in other technology-focused sectors. So how do PMs deal?
Ben Foster offered up one solution during our class on OPOWER. Although his firm sells its product to some of the largest and most regulation-bound businesses in America (utility companies), his product organization regards the end user -- consumers paying for electrical power -- as the customer. Ben asks the utilities who actually buy OPOWER to "allow us to focus on the consumer on your behalf."
Ben's methodology seems like a great fix -- basically turning OPOWER into a B2C firm for product management purposes and focusing on a single set of stakeholders. But this is not an approach that will work for every B2B firm. My friends' timesheet app, for example, has two customer voices. He must listen to both, and incorporate features that some users don't want.
For ventures like his, I suspect the best solutions start with good customer discovery but require establishing organizational priorities around which users matter most and where the product can make compromises -- product principles, according to our note on product management. I think B2B startups will need such principles far earlier than B2C ventures, and their thoughtful articulation will be critical to the success of managing the product.
