During a conversation with a potential client this week, I was asked: “What is the relationship between Project Management and Product Management.” He wanted to know how the two concepts were related.
I explained to this gentleman that the two concepts are intimately intertwined with each other. Products are usually developed, rationalized or optimized using the basic principles of Project Management. A project has to be initiated, planned, executed, monitored, controlled and closed.
Additionally, the development and cultivation of a product portfolio can be a project itself. I supported my comments with the following points:
– The goal of Product Management is to have an optimized product portfolio. The products within the portfolio must be balanced with regards to profitability, competitive differentiation, translatability and growth potential.
– You accomplish this objective through constant cultivation of the product portfolio. By cultivation I mean you engage in:
– New Product Development & Commercialization
– Multi-Generation Product Planning
– Rationalization of Obsolete and/or Underperforming Products
– Maximizing Supply Chain Economics
– Exploiting Market Trends through the Voice Of The Customer
– Every one of the above-mentioned product portfolio cultivation processes is related to Product Management and requires the use of Project Management discipline in order to be successful.
– It is important to avoid “one-off” type products regardless of the potential price or volume. If a new product or any product lacks translatability, it is not worth pursuing. There is too much downside risk. Strong Project Management discipline will help prevent this scenario from happening.
– A Stage-Gate Process ought to be utilized for New Product Development and Commercialization Projects. It must be robust enough to not allow any product to advance to the next stage of development until it has met certain commercial, as well as, technical criteria. This relates to the planning, executing, monitoring and controlling phases of Project Management.
– When a new product enters the pilot and production ramp-up stages, sufficient lot sizes ought to be produced to verify run rates, costs and first-pass yield quality. No product should exit the production ramp-up stage into full commercialization until it can consistently be manufactured to its targeted cost, run at rate and quality targets. This relates to the executing, monitoring and controlling phases of Project Management. It also relates to the closing phase of a project in Project Management discipline.
– Once a new product is commercialized the product development process does not stop there. The new product needs to be tracked to verify it is achieving its sales volume targets and is meeting customer expectations. Lessons learned from developing it need to be applied to the next generation of new products to keep your competition at bay.
– The Voice Of The Customer is what drives speed, accountability, commitment and teamwork into the product management process because it focuses everyone on the customer needs and this creates competitive differentiation.
– Product Management starts and ends with the Voice Of The Customer. It is Project Management that helps a company capture that voice and translates it into something of value for the customer.
So you see, Product Management and Project Management are intimately connected to each other. You cannot have a strong Product Management Process without strong Project Management Discipline.
Need help in improving your company’s Project Management Discipline? I can help you. Call me at 248-760-6564 or email me at rich@TrueNorthPMPConsulting.com
