Mr. Hector Del Castillo, Chief Product Officer of BoldPM, assesses in a live webinar, held on May 20th, co-hosted by LEORON Professional Development Institute, the main components that product managers need to look at, in order for business leaders to be prepared for the business changes during the COVID-19 Pandemic.
Commercial, aerospace, insurance, oil and gas sectors have had the greatest impact, while other sectors have shown a significant shift in demand due to the changes in customer behaviors.
As a product manager, the first thing you should do is assess the current situation. In most industries it is looking like an economic recession, but one industry sector differs from the other. In some cases, it could be a depression, where the entire COVID-19 spread could turn into a global recession. According to research conducted by McKinsey, the hardest hit sectors, such as retail and luxury, may not see a restart until Q4 of 2021. In fact, it has been estimated that the US will be hit worse than the last recession in 2007. So what can you do in your market, how can you step up as a product manager to persevere until recovery starts?
Most products fail within three years of introduction mostly due to lack of understanding in buyer behavior. There is a high product failure rate of 60% to 90% because nobody in the organization really bothered to test whether customers really need their service or product. In other words, most vendors don’t really focus on understanding customer needs or purchasing decisions. Otherwise you are here today, and gone tomorrow. So companies need to explore and optimize.
Some Tips on Product Success
–Lead Cross Functional Teams: It’s important for product managers to orchestrate the value creation process across the entire organization. Product Managers have a complex role because they need to interact with core business functions within the company and driving all aspects of the product.
- Focus on Improving Product Portfolio Profitability: A product manager needs to look at the people, processes and product portfolios, in order to make a profit. Are your products cash cows, stars? Do you have a proper team of people? Are the right people allocated? Are you managing and measuring your product profitability, with the help of cross functional departments? All these questions need to be addressed by product managers, and shared with top tiers.
- Product Managers are too tactical rather than strategic: A survey report conducted by the 280 Group, published in 2015, showed that 56% of executives indicated that the skills level of their product managers was below average, 43% of product managers were unable to influence management effectively, 38% of them were not perceived as effective leaders and are not modernizing their tools, systems or methods. Product managers play a key role if they work strategically and think of creative ways to connect cross functional teams to lead to profitability.
- Product Managers need to optimize their processes: 51.7% are at companies where processes are not well defined, and there is a lack of exploration of new processes.
- Product Managers need to properly measure product performance (profitability): Successful companies need to assign the right people, optimize their processes and systems in order to be market leaders.
SEVEN ways to Boost Product Resilience and Deliver a Consistent Customer Experience
1- Fix Business Continuity Issues; you need to sustain your cash flow, which is the fuel to your company’s growth engine. So if you are not ‘topping up your tank’ before recovery begins, this will be an issue. You may need to repackage your product offerings to target the growth industries, until recovery begins. You need to figure out in a team environment your business model, find ways to reduce your cost structure and find ways to increase your revenue stream.
2- Cultivate a Growth Mindset Culture; A good example is Enterprise Holdings and how they reacted quickly to the Pandemic and ensure that students got home safely from campuses by providing them with car rentals. The right mindset within the company made a huge difference. A fixed mindset culture cannot explore or exploit new opportunities, while people with a growth mindset have a positive influence in their teams and deliver profitable growth, and allow for an excellent customer experience.
3- Grow your Product Management Team; Growing the team means training them and improving their skills set. When you assess internally your team’s skills and benchmark internally, you will notice the effect on product success. Understanding your product pricing is another example of having a huge impact on product success and customer excellence. GM stayed in top of mind by being part of the community.
4- Deploy Product Management Process; Processes really matter because product managers that work for organizations that have an established process are stronger in their skills that those who work in an organization with no organized process. Deploying a product management process is complex, and includes details such as defining deliverables and tasks in a team environment, and compiling teamwork efforts.
5- Optimize Product Performance; Product managers need to assess how well they deploy their strategy. For example, they need to Look at customers, position the products to get the demand they need, adjust processes accordingly to acquire and retain existing customers in order to survive during the pandemic. Take a look at Moldex and Honeywell; these are mid-market mask manufacturers that are ramping up production for M95 masks, most likely globally soon. They managed to optimized their product performance to market requirement.
6- Boost Perceived Customer Value and Keep it Consistent; Netflix is a typical example, where the cost structure for clients is not yet clear. Product managers need to set up a well-balanced cost structure, where the product lifetime value is clear, and should be lower than the cost of acquiring customers.
7- Accelerate When Needed; Those companies that have not done much digitization of their business will need to catch up fast. There are entire industries, such as F&B manufacturers that need to accelerate right now, on the consumption side and the supply side in the value chain. Product management teams need to work hard on this area, and when this is not their expertise, they need to exploit and explore these opportunities and digitize their business. Zoom has been around for some time, and it is currently the number one video conferencing system since they adapted to market needs.
Prepared by Maha Ahmad
Freelance Marketing Consultant | Blogger
With an M.A. in Marketing and a Diploma in Digital Marketing, from the UK, Maha worked on several projects in Dubai and the UK. Maha has over 15 years’ experience in marketing consultancy, content management, and all things communications. Connect with Maha on LinkedIn
About Hector Del Castillo
Chief Product Officer | BoldPM
Hector is Chief Product Officer at BoldPM, a product management consulting firm, that helps product executives and leaders turn ideas into valuable products to outperform their competitors. Connect with Hector on LinkedIn