What's your Compa-Ratio?

A product manager's CTC (cost to company) can have many components, which are mainly broken down into the following:
  • base salary
  • variable pay
  • retirement benefits
  • stock (ESPP, RSU, Stock Grant etc.)
  • bonus (joining, annual, shipping bonus etc)
Knowing that there are so many CTC components makes it difficult to evaluate competing job offers or even "quote a salary", as is commonly demanded by recruiters these days.

For offshore product managers, one way to benchmark your salary is to find out your compa-ratio at your firm. The Wikipedia link has the basic explanation of what a compa-ratio is, and how it is applied during recruitments and performance appraisals. In a large firm, this is the direct way to find out if you're paid above average, at par, or below average. And actually, this also has a good correlation to your past performance, your relationship with managers and the industry performance as well. So knowing or guessing your compa-ratio puts you in a good situation during the salary negotiation time both within the firm or when you have an offer in hand.

For startups, smaller firms or Indian technology firms, you might not find this information from your HR contacts. In this case, one alternate is to trawl the web with queries such as "salary for X role" in "City Y" [ I get some traffic on the blog from these queries too!]. And thankfully, there is quite a lot of reasonably accurate information on this available in 2013, compared to the situation five years ago. These give some pointers on the potential offer, given your current compensation, the industry standards and the salary at the company in question.

One final thought, given the limited risk-reward situation in high-tech product management, it would be wise to only compare base salary as a lump and all variable components as another lump.

Who's the Hiring Manager?

Based on the number of calls from recruiters these days, it looks like the Product Manager hiring season in India is on in full swing. However, one simple question makes it easy to identify which firms are likely to have a long and tedious recruitment process for a PM role, and which ones are really keen to hire new people.

And that question is a simple one...
"Who is the hiring manager for this role?"

Now some recruiters will hem and haw, while others will say we simply look for a fit between candidate and company (many internet firms still try this line). It's very simple, if they are not able to give you a credible answer, then there is something very wrong with the picture. They can hide the compensation range and ask all details from you, but this is a very important question that the recruiter must answer. Actually, they should give full details on who is the hiring manager, what job grade the role is at, and which business unit is hiring.

I have observed that some startups and a few teams in large technology MNCs do try to be secretive, saying that they would reveal these details after you join them. And the recruiters also seem to avoid replying to this question. Well, that's like buying a pig in a poke. No matter how good the brand name, you can still mess up your job change, and negatively impact your career.

The One Pager about a new product or software release

I first heard about this in a Microsoft team (I was working elsewhere in enterprise software at that time). The one pager was supposed to be the answer to every product teams' planning initiative, and the composition of the one pager was given top priority by senior management as well as the product management team.
Well, when the one-pager finally arrived, it was a big letdown. It was not of one page, was really vague, and was closer to a mangled mission statement (follower's of Dilbert will know this) than any product vision.
So what goes into a good One Pager?
A good one pager, in my opinion, should have the following 5 sections:

The Market Description

This section should give insights into the following:
  • What is the market like in terms of geography, verticals etc.?
  • What are the current solutions in the marketplace
  • Where is it heading, or what are the observed trends?
Do not spend too much time or more than a few sentences on this, as this is a very high level description of the market.

The Problem Statement

What is the exact customer problem? For online clients, it could be something like too much data, or stagnant e-commerce revenues. For enterprise customers, it could be a customer needing a "simple" and easy to use product for his IT Service Desk Management needs across all geographies.
If you know that this is common knowledge within your firm, then you can even get by with a single line problem statement, with subordinate clauses.

The Proposed Solution

This is the section that is of major interest to engineering teams and other internal stakeholders. First, clearly describe what the solution is, in a single sentence. Then use a few words to describe the different components of the solution and the benefits of each component. Finally, describe ONE usage scenario where the solution will solve the customer problem described above.
If you like, you can even fill in a few engineering details, such as the need for Open Source Web Servers, API requirements and so on. A block diagram will probably take too much space without adding value.
You can leave the remainder of the use cases to be filled out during PRD generation (to be explained in a future post).

The Financial Benefit

This part causes the most heartburn in product managers who rise up from engineering ranks. They have been used to precision and results, and building financial models to predict the range of revenues and profit margins of this product over 3-5 years based on multiple assumptions can be a big challenge. My personal belief is that this stems from a lack of confidence, which can be overcome simply by practising this repeatedly.
Do not skimp on this section, and try to put as much detail around pricing, growth in customer base and quarterly revenues as possible. The lack of details around financial benefits can easily kill your vision as it moves upwards through corporate hierarchy.

The Challenges

This is an easy one. If you have an idea of the market and the customer problem then you can describe the external challenges around achieving revenue goals. And if you know how engineering will build your solution, then you can describe the internal risks.
If you have a good sense of what the competition is doing, you can write a line about it here. Although this is not recommended by most experts.

So what do you finally deliver in 5 sections, 1 page and 400-500 words?

Ideally, you deliver a "One-Pager" that is a summary of the goals of a product team, for building a new product or designing a product release. If you can actually deliver this, it will go a long way towards building confidence all around, in your capabilities as a product manager.

How to justify new features for a smartphone

This post is for product managers to understand a process to add new features to a new or existing product.






Honor 9i OnePlus 5 Samsung S8+ and iPhone X
Honor 9i OnePlus 5 Samsung S8+ and iPhone X


Adding edge to edge displays to a flagship smartphone

So the iPhone X has been launched. And we have the usual suspects in India, including the Samsung S8+, the Oneplus 5 and the Honor 9i.

All of these show the trend of reduced bezels, full HD and HD+ displays and bigger screens within the same form factor. They are branded as infinity displays, edge to edge screens and what not. The key benefit is touted as distraction less viewing. Apple also touts the importance of experience over device (their strategy of mirroring the logged-in user experience across devices supports this).

This is the end state outcome which started with a product manager identifying these as a necessary feature set for the smartphone evolution. Once this feature set is identified, the PM then has to make the business case to get this included in the product (software features are easier and faster to create and update, hence that is a simpler argument to make.)

Making a pitch for including this feature set

As a product manager, here are five reasons used to convince business leadership to include edge to edge displays in the next generation of their flagship phones.

1. My competitors are doing it (yes, this is a good benchmark)
2. User research indicates that it is a powerful new feature
3. Supply chain indicates that this is profitable beyond first 300,000 units shipped
4. Replacement and warranty business case indicates a very high margin (can even go up to 90%)
5. It will differentiate our latest flagship from previous versions, and will compel users to upgrade

Once you have data to back these reasons, it becomes a straight forward process to prepare a presentation, circulate it to management and get signed approval.

Note

You can always add new features to any product. The key is to identify the value to everyone, not just the users, from getting the features included. Try that in your next product pitch and drop me a line on how it worked out.

Revenue Responsibility


Agile Product Development / Certified Scrum Product Owner


Agile-Product-Management-With-Scrum
A while back, I had reviewed a pretty good book "Agile Product Management with Scrum" by Roman Pichler. You should definitely read it cover to cover to learn about Agile software development and the Product Owner/Manager's role.

Now, it may be time to go one step ahead and become a Certified Scrum Product Owner (CSPO).

This certification is a basic two-day introduction to gathering requirements and delivering them to the scrum team in the format of user stories. After getting certified, you will also get access to the online forums, blogs and other resources that you can use to hone your story-writing skills. One advertised benefit is the ability to show potential employers your knowledge of Scrum. There are some other certifications associated with Agile development (Scrum Master, Scrum Developer, Scrum Coach etc.) which are of limited use in a Product Owner role. You can find more information on these with a simple Google search.

Alternatively, you can go for the PMI Agile Certified Practitioner (PMI-ACP)® certification. This looks like a rigorous training with a lot of pre-qualifications before you apply for the certification. However, if you are already PMP certified, then it may be easier to get this certification. Personally, I am not in favor of product managers going for a PMP certification, for the simple reason that product managers have a different role that project managers.

If you are an old-timer in the industry, you might remember how Rational OOAD and UML was a pretty big thing at one time. And to get business analyst roles, you had to be well versed in those tools. Now with teams going agile, these certifications may give you the edge, when you are out there, looking for a product manager/product owner role.

Do understand your own career aspirations, the costs associated with these courses and then make an informed decision on either of these certifications.

Product Manager Or Business Analyst

Here's a scenario, you have several years of engineering experience under your belt. You have also managed to get a part-time MBA during your career. And now your organization has moved you from engineering/dev-ops/tech. support to product management. Here is another scenario, you have been working as a business analyst in an IT services firm, and have worked for a few product development clients. And now a client in that domain has offered you a product management role.
Is it time to celebrate this awesome product management opportunity?

Well...read further. The following job features may indicate that you end up working as a business analyst.

Reporting to Another Product Manager

No brainer, if your reporting is not to senior management, in India or overseas, then only a part of the product management function is delegated to you. This aspect brings the role closer to a functional business analyst role.

Limited/No Engagement with Product Marketing

If your only engagement with product marketing is at an all-hands meeting or a town hall, then you are not engaged in any outbound product management activities. This also tilts your role towards business analysis rather than strategic product management.

No Involvement in 2-3 of the 4 P's of Marketing

You can figure out if this is relevant to your role, and whether you are able to work on these as a product manager or a business analyst.

Engineering is your Primary (or Only) Stakeholder

If you are working as a product owner, with limited product management tasks, then that is fine. You have a well-defined role which fits into the product management hierarchy, in today's agile world. But if you are called a product manager, and your reporting is to a Director of Engineering, and your primary stakeholders are the engineering team, then you might be working as a functional business analyst.

Your Main Work Output is a Functional Specifications Document

This is typically true in e-commerce firms or start-ups. Most product managers in such firms are actually working as business analysts, creating functional specifications, providing reports on product usability and usage. And product decisions are usually made by the senior management of these firms. Business analysts handle such activities in most enterprise software firms.

Limited Engagement with Senior Management in Business Units

Product managers play a strategic role in addition to taking care of tactical activities. If you have never presented on strategy, finance, operations, pricing, marketing plan, new product business case or another business metric to senior management, then you may be working as a business analyst.

Revenue Responsibility

This is a pretty big subject in product management, and will be taken up in another post.

Note:
There is nothing wrong with the role of a business analyst. BA's have a lot more exposure to the product and business domain than a regular product developer. The current challenge in India lies in the fact that firms require BAs and advertise for PMs, which sometimes leads  to an expectation-reality mismatch.

In transit

I am currently in transit from the NCR region to Bangalore. Winter's coming (ignore July 17 season 7 launch) and there is a lot of personal chores to complete. Will keep posting on this blog about more changes to come.