Behind Every Great Product by Marty Cagan

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In the opening keynote at this year’s London #mtpcon, Silicon Valley Product Group’s Marty Cagan shared his latest thoughts on what makes a great product manager by looking at the people behind some great products.

Through his time at eBay, Netscape, HP and elsewhere, Cagan has worked with lots of great product teams, and has been influential in his writing and coaching about the role of product over the years, but he acknowledges that there is still a lot of confusion about the role of a product manager. There hasn’t been much success in defining the role, but the role itself, Cagan believes, has never been more essential. Product managers work in three ways he says – there are product managers that don’t make any decisions and escalate everything to their manager, there are product managers who call a meeting every time a decision needs to be made, and then there is a third way, which is essentially a product manager doing their job.

Behind every great product there is always someone, who may or may not have the title of product manager, who works incredibly hard to solve incredibly difficult problems. In his talk Marty examined some highly successful products, and the outstanding product managers responsible for them.

Microsoft Word

Marty CaganIn 1993 Microsoft was working on the biggest ever release of Word, 6.0. At that time Word was supporting three platforms – Windows, DOS, and Mac, and so a big goal with the release was to get a common code base. It shipped but its performance on the Mac was impossibly slow which resulted in claims that MS was trying to kill off the Mac.

Martina Lauchengco was given the task of fixing this problem. Microsoft worked on Word’s performance on the Mac, on fonts, on keyboard shortcuts, and three months later released Word 6.1 for the Mac. It was shipped to every registered user and accompanied by a letter from Lauchengco which apologized for the previous release. This completely reset perceptions within the Mac community, but it also caused a reversal of strategy from Microsoft who realized that they needed to build a business unit around the Mac. It’s impossible, says Cagan, to estimate the difference this made. There’s a lot of lip service paid to doing the right thing for the customer, but here, Cagan says, Lauchengco made sure she did the right thing for the customer and completely changed perceptions within Microsoft. Her actions also, he maintains, changed the course of Apple’s and Microsoft’s history.

Netflix

In 1999 Netflix was a small company with an online version of Blockbuster, renting out movies and delivering them through the post. It had 300,000 users but was not making any money. Netflix tried a monthly subscription model offering people all the films they wanted. This was a success but created some hard product challenges, because everyone wants new releases, which are much more expensive than older films to provide. So Netflix came up with its rating and recommendation system so that people would rent a mix of films, and this, says Cagan, powered Netflix for the next seven years. To be able to get the new model out the door, product manager Kate Arnold had to bring together the Netflix founders on strategy, and work with users, analytics, design, engineering, with marketing on the new acquisition model, with finance on the business model and billing, with the warehouse on fulfillment, and with film industry.

Google Adwords

Sixteen years old, last year Adwords generated more than $50 billion. But no one knows Jane Manning, the product manager who was asked to get it off the ground. There was initially huge resistance to Adwords at Google – from engineering, because they worked hard to provide relevant results, and from sales, who were selling key words to big brands and who were legitimately nervous about cannibalization.

Adwords came close to not being built. Manning had to work out the real issues, says Cagan, and had to address the nervousness about advertising. She made the case for Google Adwords as a product for the small business owner. She went to a respected engineer at Google and convinced him of its virtue and he influenced other engineers. It has been, says Cagan with some understatement, a radical success.

BBC

The BBC was one of the first companies to enable content syndication, and in 2003 product manager Alex Pressland started to look at where it could be used. She noticed that big video screens in city centres were just playing what was on TV, so she had an editorial team create some custom content and then measured the audience reach and engagement. This was a radical departure for the BBC which at that point had a broadcast culture rather than one of content distribution. She proposed a new strategy to the BBC “BBC out of home” which became its mobile strategy. This is a story as much about force of will as product management, says Cagan – today more than 50m people a week use BBC mobile products.

Apple iTunes

In 2008 25m people watched American Idol twice a week, with great audience engagement. iTunes was trying to go mass-market and Apple worked out a deal with American Idol producers. Camille Hearst was tasked with making iTunes part of the daily life for Idol watchers. But Idol is all about voting and iTunes was all about trending music – so if they showed the sales of contestants’ songs no one would tune in to see who was eliminated. Apple had to change iTunes in some significant ways, which led to a $20bn business and Hearst had to be very creative in coming up with solutions that would satisfy Apple, American Idol producers and its audience.

Adobe Creative Cloud

Lea Hickman led product for the Creative Suite at Adobe, it was a $2bn a year business, accounting for half of Adobe’s revenues.
However this was all installed desktop software, and she realised that Adobe needed to move to a software as a service model. Everyone in Adobe wanted to protect such huge revenues and the obstacles in moving such a big business from a licence model to a recurring revenues model cannot be overestimated. Adobe made their money through third party channels, and this change also meant they were going to have to move to a direct relationship with customers, so it’s no exaggeration to say that they were betting their company on the move to SaaS.

Hickman had to convince the entire company to move to a new way of working and doing business. She teamed up with the CTO to create prototypes, which she then used to articulate her vision and get support from key executives and crucial teams. She embarked on a sustained campaign to get people on board and keep them on board as the new model was rolled out. It was an unprecedented success – Adobe went from 1m users of the Creative Suite to 6m users of the Creative Cloud. Adobe was the fastest company to reach $1bn in recurring revenues, and the market cap of the company has tripled.

What do Cagan’s examples show us?

Marty CaganProduct management is distinct from other disciplines. We need to stop having ridiculous discussion about role, says Cagan, and stop talking about product vs project management. Such discussion misses the point of the job, and the point is that it is very similar to that of a CEO. Good CEOs know they need to persuade the team. Like CEOs, product managers must deeply understand all aspects of the business, from marketing to sales, finance, manufacturing, legal, and partnerships.

Great products require intense collaboration with design and engineering to solve real problems for customers in ways that meet needs of business. Great product managers are smart, creative and persistent, says Cagan, and they’re not afraid to lead through inspiration, motivation and logic.

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