Happiness can be hard to find, especially in the workplace. Yet product managers generally love what they do and find the role quite fulfilling. However, there’s often a disconnect between aspects of the job that make product managers happy and the metrics upon which they’re judged. When this occurs, product managers must focus on goals unaligned with their passion. The truth is product metrics are affecting product managers’ happiness.
Product Metrics are Affecting Your Happiness
What happens when hitting those metrics comes at the expense of the ideal product experience and user satisfaction? Let’s explore this common conundrum some product managers must face.
The Strategic Shift
Product management was once more about getting deliverables out the door than determining which deliverables to ship. But the discipline has matured, and more organizations value what dedicated product management has to offer. Product strategy has now become the primary focus of the job.
Product strategy is a high-level plan for the product. It ties overall business objectives to the product. It specifically identifies how the product will help the company meet its goals.
Once defined, the product strategy should drive every downstream decision. It’s a superset of the product vision, goals, target markets, differentiators, and initiatives.
Our survey respondents reported that they’re typically tasked with defining, maintaining, and evolving the product strategy. This outlook is a shift from serving as glorified project managers with limited decision-making responsibilities.
Organizations increasingly realize the benefits and importance of dedicated product management. They’re staffing for these essential tasks instead of leaving product strategy up to the executive team or technical leadership.
Metrics that Matter
A finished product strategy should result in its own set of metrics to gauge whether it’s a success. However, those metrics may not be an identical match with those of the business as a whole.
Business metrics typically focus on growth, revenue, and profitability. Product metrics tend to look at adoption, usage, and engagement. Customer-oriented metrics will zero in on things like satisfaction, net promoter scores, and churn.
For example, a business metric may be revenue, while a product metric may be useful. While those usually aren’t entirely unrelated, they’re also not the same thing.
Customer-focused metrics may similarly diverge from those of the business. In this case, the business metric might be renewals, while the customer-oriented metric could be user satisfaction. Once again, there’s a correlation, but they’re not the same thing.
Complicating things more companies selling multiple products or having varied sources of revenue. These could include services such as consulting or customization fees.
In these situations, the business metrics are a roll-up of all these aspects of the business. Some of those are unrelated or significantly removed from the actual product.
Finally, some metrics abstract from a product’s performance. Metrics like stock price, investor valuation, media mentions, or other vanity metrics. A product manager’s ability to influence these is so indirect they might not feel any connection to the goal.
The Inherent Disconnect
It’s hard to find happiness without knowing how you’re being measured.
Imagine you’re playing soccer, and someone changed the rules without telling you. Suddenly the goal of the game isn’t scoring more goals but instead completing more passes. But you’ve been solely trying to put the ball in the back of the net this whole time. When you find out you lost because you didn’t know what the real objectives were, you’re not going to be happy about it.
The same concept applies here. Product managers usually “know” what success means for their product. They don’t need anyone on the executive team to define that for them. But if management is playing a different game, then they need to tell PMs the new rules.
Product managers can adapt and work toward whatever goals the business sets out for them. But they need to know what those are. We’re happy when we’re making progress, whatever the final objective may be.
In our 2020 product management survey, the most common metrics used to determine product success were business metrics (34%). These include things like customer acquisition cost and average revenue per user. Meanwhile, product metrics (31%) were the second most common measure of product success—followed by customer-oriented metrics (22%).
Product managers challenged with improving business metrics via the product must serve two masters. On the one hand, they’re basing their performance measurement on how they use the product to influence business metrics. On the other, they’re trying to move the needle on the product and customer-oriented metrics because those indicate that they’re delivering a product the market wants, and users appreciate it.
This schizophrenic approach could have an impact on a product manager’s happiness. Product managers want to make great products, which leads to positive business outcomes. Being asked to worry more about business metrics and “do things backward” can be frustrating and distracting.
So it wasn’t surprising to see the least happy product managers were those asked to define success based on business metrics (versus customer-oriented or product metrics).
To hammer that point home, the most prominent complaint product managers had was a lack of a clearer purpose and company strategy (37% of respondents). It is our nature to want a fully-formed plan and then get the opportunity to turn it into reality.
Aligning Meaningful Metrics via the Product Roadmap
One place where product strategy and metrics can intersect is the product roadmap. We all know product roadmaps aren’t just a chronological list of scheduled features. They’re a visual representation of key product strategy goals and the plan to achieve them.
The goals called out in those roadmaps can definitely be tied back to the metrics and KPIs, the organization cares about. Each initiative on the roadmap should have specific metrics associated with it, along with its expected impact.
But those metrics may or may not line up with those of the business. Active users, actions per session, sustained feature adoption, time to value, and other product metrics like these may not be on the list the business cares about. But if the product doesn’t excel in those areas, it’s harder to move the needle on the prioritized business metrics.
We’re also not saying that business metrics aren’t relevant to product managers. Many SaaS marketing metrics are important and informative for PMs. And they usually can help move them in the right direction with their decisions and strategy.
However, many business metrics are beyond the control of the product itself. Using those as a gauge of the product team’s success (versus the company’s) isn’t always an accurate measuring stick.
Tapping Customer-Centricity to Bridge the Gap
Product managers evaluated on customer-oriented metrics are happiest. Customer-centric organizations tend to be more successful. So using customer-oriented metrics to measure success seems like a win-win for everyone.
By making every decision with the customer in mind, these companies are betting that positive customer experiences will yield dividends across the business. And, of course, the product typically leads the way since that’s where customers primarily interact with the company.
These organizations also prize customer empathy. In doing so, it leads to metrics emphasizing user experience rather than obsessing over profitability. Instead of short-term revenue grabs, these organizations bet on longer, higher-quality customer relationships. They’re creating loyal fans that stick around longer with a higher lifetime value.
In a customer-centric environment, the metrics are inevitably aligning with product goals making them more accessible and more rewarding for the product team to rally around.
Learn more about the current state of product management in the 2020 Product Management Report.