Where Does Product Management Fit?

Recently a CEO asked me if the marketing department should include product management and marketing communications. His concern was that internet/digital marketing had become so complex and such a huge task that having the responsibility of both marketing communications and product management would be difficult. It’s a good concern and a great question, one that underscores that the product management function has matured and become more essential, and as he pointed out, the internet has made both B2B and B2C marketing more quantitative and complex.

However, I have long believed that it is important for these two functions to remain as one. And while more and more organizations have separated their VP of Marketing and VP of Product Management roles, I am not sure that benefits the company.

Why?

Let’s first start with some background. There is a lot of disagreement over where product management should report and even disagreement whether it’s effective under certain organizations (see these threads: the cranky product manager clearly disagrees with me and my friend Steve Johnson formerly of Pragmatic Marketing now of Under10 playbook believes product management should have its own seat at the table). Finally, the product management software organization Pendo in their State of Leadership report states that 44.7% of product managers report to the CMO (the most), while 6.7% report to ‘Product’ (the least).

I am going to stake out a different belief and a different point of view. I believe that product management and especially product marketing ARE marketing roles first and foremost. Therefore, I believe product management is most effective and should be under the VP of Marketing, in today’s world, the Cheif Marketing Officer. However, I do respect that it also can be equally effective as a separate organization under some type of product lead.

Before I continue let me state some side comments about organizational structure that I also believe:

  1. Marketing under a VP of sales (VP of sales and marketing) is a disaster. When I see this title, I see a sales person who wants bigger responsibility and more control. I also see a marketing department reduced to sales support and lead generation.
  2. Product management under engineering is also a disaster. I believe that an effective product management organization defines ‘WHAT’ the product is or will do and engineering /development defines ‘HOW’ it will do it. Together they decide when, based on resources, strategy, etc. When one is placed under the other, a development/engineering person usually leads it, and there is little if no accountability. I see product management reduced to a gopher for development and a clean-up function. It’s basically powerless. Bad for the company.
  3. Product management under sales. Yes, I have seen this. When I joined a company in 2006 to run product management (as a CMO), the VP of sales would meet with the product managers every Monday morning to make new feature requests per what sales had sold the week before. Not a good way to build a repeatable, scalable, profitable product or business. But it’s a great way for sales to make sales! Any objections? Don’t worry, next Monday we will meet with the product managers and ask for whatever you want, even if it’s just for one customer —versus a MARKET—we will build it and we can close this deal. Not good for business.
  4. Product management on its own under a chief product officer (CPO).  This is clearly the emerging model. However, the chief product officer is not an entirely new role; leaders with this title have existed for years. But interest in and influence of the position have grown steadily over time, and today more companies than ever are adding a dedicated C-suite product lead. Many powerful and recognizable brands have appointed a chief product officer; including Google, CNN, Uber and Forbes to name a few. A search for professionals with the title on LinkedIn turns up thousands of results.

The rationale for structuring this way is: much like marketing, product is no longer something influenced by one narrow part of the business. It’s an organization-wide process that requires cross-silo integration and collaboration. Strong product strategy and innovation is vital to earn and maintain a competitive edge, but success in the product field can only be achieved by someone who has C-level authority, resources and clout. True product innovation is what is separating top companies from everyone else in today’s competitive landscape. Give ‘product’ a seat at the table.

OK, so why Marketing and Product Management together?

My case is rather simple. While I do believe that each function has more responsibility than ever, I also believe the most effective marketing organization has three parts:

  1. Product Management/Marketing
  2. Marketing Communications/Corporate Communications
  3. Business Development/Partner alliances.

These three legs of the stool are the definitions of what we are building and how we go to market, and allow for the creating of what Geoffrey Moore discusses as a ‘whole product’.

These three parts are required to work together closely to get the classic marketing 4Ps right: Product, Price, Place, and Promotion. If you separate one of the Ps out of the equation you become at risk of making the job of the Product Manager increasingly more difficult.

First, you are separating marketing in two, making an already difficult job even more difficult because it has all the responsibility and none of the authority, making it fight for resources inside their own profession, marketing. That’s a challenge that product management doesn’t need. At least giving them the ability to work under the same department as marketing communications, so they can better access resources to be successful with their products.

Second, a common complaint that I hear about marketing communications people and organizations is they don’t ‘get’ or ‘understand’ the product. This is common. If you separate product management from marketing communications, making it more of a service organization, you further that divide, making it more difficult to communicate a differentiated value proposition. As an analogy, whenever there’s a revolution in any country, there’s a reason that the radio stations, newspapers and the internet is taken over first—owning the communications is essential to driving where you need to be, and getting people to respond. Separating this from product management, and vice versa, makes the marketing job more difficult. It INCREASES barriers to transactions in jobs that are all essentially marketing jobs. That’s not good for business.

So yes, I understand the need for product management to have a VP and a ‘seat at the table’. That’s a good thing. However, having the CMO role, or a VP of Marketing role, that includes both product management and marketing communications functions I feel is the best structure.

That’s what I think…