The History and Evolution of Product Management (2023)

Both new and experienced product managers often ask where this role came from and why it seems to have so much crossover with other roles such as Marketing and UX. While there’s no definitive history of product management, it’s often useful to consider our roots and understand how the role evolved over time. If nothing else it helps to understand the organisational trade-offs that happen as our capabilities and thinking evolve.

The History

Modern product management started in 1931 with a memo written by Neil H. McElroy at Procter & Gamble. It started as a justification to hire more people (sound familiar to any product managers out there?) but became a cornerstone in modern thinking about brand management and ultimately product management.

What he laid out in his 800 word memo was a simple and concise description of “Brand Men” and their absolute responsibility for a brand – from tracking sales to managing the product, advertising and promotions. Uniquely he outlined that the way to do this was through thorough field testing and client interaction.

McElroy got his two hires. He also got P&G to restructure into a brand-centric organization and led to the birth of the product manager in the FMCG field. McElroy later became Secretary of Defense and helped found NASA, proving all product managers are destined for greatness, but he also advised at Stanford where he influenced two young entrepreneurs called Bill Hewlett and David Packard.

They interpreted the Brand Man ethos as putting decision making as close as possible to the customer, and making the product manager the voice of the customer internally. In the seminal book The Hewlett-Packard Way this policy is credited with sustaining Hewlett-Packard’s 50 year record of unbroken 20% year-on-year growth between 1943 and 1993.

Hewlett-Packard had many other firsts – for example they introduced the division structure, where each product group became a self-sustaining organization responsible for developing, manufacturing and marketing its products. Once a division became larger than 500 people it was invariably split further to keep them small.

Meanwhile, in post-war Japan, shortages and cashflow problems forced industries to develop just-in-time manufacturing. Taiichi Ohno and Eiji Toyoda (the nephew of Toyota’s founder and eventually chief executive and chairman of Toyota Motor) took this idea and ran with it – developing the Toyota Production System and the Toyota Way over 30 years of continuous improvement, focusing not just on eliminating waste in the production process but also on two important principles any modern product manager will recognise: Kaizen – improving the business continuously while always driving for innovation and evolution and Genchi Genbutsu – to go to the source to find the facts to make correct decisions.

Of course, when just in time manufacturing came to the west, Hewlett-Packard was one of the first to recognise it’s value and embrace it. Thus Hewlett-Packard alumni brought this new way of thinking – customer centric, brand vertical, and lean manufacturing – to their future jobs, quickly permeating the growing Silicon Valley with the same ethos. From there it has spread into every hardware and software company to the global movement we know and love today.

(Video) Chapter 4: A Brief History of Product Management | Product Management Foundations Series

When Product Management came to tech

The original product managers, and indeed the majority of product managers in FMCG today, were very much a part of the Marketing function. They focused on the process of understanding the customers’ needs and finding a way to fulfill those needs using the classic marketing mix – the right Product, in the right Place, at the right Price, using the right Promotion.

Their key metrics were sales and profits, but because of the slow moving nature of the development and production of new products in FMCG (imagine how long it takes to develop and test a new toothpaste, ramp up production and then bring a new brand to market) they focused more on the final three Ps: Place, Price and Promotion or Shimizu’s four Cs: Commodity, Cost, Communication, and Channel.

Thus Product Management in FMCG increasingly became a marketing communications role, concerned with getting the right mix of packaging, pricing, promotions, brand marketing, etc, leaving the development of the product to others.

As the role moved into the tech world however, this separation from the development and production of the product was untenable. Most of the newfangled companies in the tech world were inventing whole new industries and they couldn’t just rely on packaging and pricing of a commodity to succeed. This brought Product Development back to the centre of the Product Management role, as it was imperative not just to understand the customer and their needs, but to align the product’s development with them.

This schism between Marketing and Product Management can still be felt in many organisations today, where both feel they “own” the customer and understanding the marketplace. In most tech organisations however, Marketing has evolved to be more about owning the brand and customer acquisition, while Product owns the value proposition and the development of the product.

Suddenly we’re all Agile

Originally product development was a slow and laborious process, even in the tech industry. You plodded along a waterfall process, first doing research, then writing a massive product requirements document over several months, then throwing it over the wall to Engineering to build, only to get something completely different out the other end several months later before starting the process all over again.

In 2001 though, seventeen software engineers got together in a ski resort and wrote the Agile Manifesto, building on work spanning back to the seventies on light weight alternatives to the heavy-handed and process-oriented waterfall method of developing software. Though Agile and the Manifesto are heavily associated with Scrum, Scrum was actually developed before the manifesto in the nineties alongside other methodologies like DSDM and XP that were trying to achieve the same goal. Kanban, which is widely used in product development today, was developed in the Toyota Production System as far back as 1953!

Whatever the genesis, the Agile Manifesto brilliantly articulated the principles behind all these various methodologies;

We are uncovering better ways of developing software by doing it and helping others do it. Through this work we have come to value:

(Video) The Evolution of Product Management From Last 20 Years | with Marty Cagan (Product Guru )

Individuals and interactions over Processes and tools

Working software over Comprehensive documentation

Customer collaboration over Contract negotiation

Responding to change over Following a plan

That is, while there is value in the items on the right, we value the items on the left more.

The Agile Manifesto became a watershed moment in product development not just because it freed up software engineers from being conveyor belt coders churning out exactly what was specified (no matter how dumb the specs were) but because it also freed up Product Management from focusing on deliverables like specs to focusing on customer collaboration.

This focus shift was profound on many levels.

First it changed the relationship between Product Management and Engineering from an adversarial one to a collaborative one. Scrum invented the role of the Product Owner, but really all agile methods embraced communication between the Product Management role and the Engineers as the best method to figure out how to build the best solution to a customer problem.

Secondly, focusing on the customer got rid of the artificial separation between the research, specification and development phases of a project, moving elements of the User Experience discipline from an afterthought at the end of the project to a fundamental part of the genesis of a product, and an integral part of the ongoing process of discovery and development of that product.

(Video) Product Management Evolution

Finally, these principles have permeated further into the business with the development of lean practices and the development of Lean Startup and Lean Enterprise, which build on the Japanese Kaizen tradition of continuous improvement and apply the agile approach not just to product development but to the business itself.

Product Management takes a seat at the big table

Until very recently Product Management was still a part of the Marketing or Engineering functions, reporting up through those hierarchies, naturally aligned more with one or the other and inevitably embroiled in conflicts of prioritisation and focus because of it.

These days Product Management is increasingly a stand alone function with a seat at the management table and reporting directly to the CEO. This is critical because it aligns the product team directly with the business vision and goals, makes them internal as well as external evangelists of that vision, and gives them the independence necessary to make tough prioritisation calls.

What’s next?

Good product management is becoming a sustainable competitive advantage, and is continuing to evolve.

Product Management continues to absorb parts of Marketing, with many organisations making user acquisition a part of product in recognition that good product is often the fastest and cheapest way to grow. It continues to take on elements of User Experience, separating the user flows and experience from the visual design. It embraces fluid processes that adapt the way we work to what best fits the team, the product and the market, whether it’s Scrum, Kanban, something else entirely or some combination of all of the above.

But most importantly it’s something that is become more widely understood and owned within organisations. It’s becoming a discipline in which you may be an engineer, a designer, a founder or a product manager – but all that matters is that you are at the core of the product and passionately work towards the betterment of that product in service of your customers.

This may, in time, require fewer people called product managers in a company, but it puts ever more emphasis on the importance of the craft of product management. And it puts ever more emphasis on learning, sharing and working with others inside and outside our companies in the development of that craft.

Ultimately this is why Mind the Product exists – to further the craft of product management by bringing together product people of all stripes so we can all build better products for our customers.

The History and Evolution of Product Management (5)

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About

Martin Eriksson

Martin Eriksson has 25+ years experience building world-class online products in both corporate and start-up environments for global brands such as Monster, Financial Times, Huddle, and Covestor. He is the Founder of ProductTank, the Co-Founder and Curator of Mind the Product, and a Product Partner at leading venture capital fund EQT Ventures. He is also the author of the best-seller Product Leadership, How Top Product Leaders Launch Great Products and Build Successful Teams (O'Reilly, 2017).

FAQs

Who is the father of product management? ›

Neil McElroy from Procter & Gamble (the man who also helped found NASA by the way) is often pegged as the man behind modern Product Management after he wrote a now-famous 3-page company memo on the principles of brand management in the 1930s.

When was product management introduced? ›

Modern product management started in 1931 with a memo written by Neil H. McElroy at Procter & Gamble. It started as a justification to hire more people (sound familiar to any product managers out there?) but became a cornerstone in modern thinking about brand management and ultimately product management.

How old is product management? ›

Product Management can be traced back to the 20th Century through a chain of events that happened through a young and enterprising economist who dared to ask, “How can I sell more soap?” This was Neil H. McElroy, a Procter & Gamble employee. He wrote a memo in 1931 that totally revolutionized the industry.

What is product history? ›

Product History captures statistics for what products are being purchased most often. This is beneficial for repeat sales opportunities, up-sell opportunities, and for accurate purchase ordering. Your highest used item will appear at the top along with quantity and the total value.

What is product evolution? ›

A product evolution is a cycle where the products evolves in terms of features, functionalities, quality, offerings, technology etc. over time to better serve its purpose and customer needs. This may be due to several reason and the new technology developments are prime reason for this.

What is another name for product manager? ›

Some organizations use job titles such as “offering manager” or “solutions manager” to describe roles that include product management work. Depending on the product development methodology that your company uses, there may be even more title variation.

What are the evolution of management? ›

The Evolution of Management Thought is divided into four sections—not planning, organizing, leading, and controlling—but “Early Management Thought,” “The Scientific Management Era,” “The Social Person Era,” and “The Modern Era.”

What are the 3 major areas of product management? ›

It identifies the three primary areas of focus for product management, namely: Product discovery. Product Planning. Product Development.

What is the concept of product management? ›

Product management is the job of looking after a specific product within a business. It's a role at the very heart of an organization that needs to balance the need to deliver value to your company (usually profit) with what customers want and what's technically and operationally possible.

What is the future of product management? ›

The product management market is expected to reach USD 31.84 billion by 2025. Thus, for aspiring and existing product managers who are planning to climb further ahead in the domain, the future is as bright as the sun, if not brighter. All that they need is the right training and mentorship.

What industry is product management? ›

Many current product management roles are centered in the tech industry, but product managers can work within any business that makes, sells, or distributes a product — from automobiles to software, biochemicals, pharmaceuticals, and consumer goods.

How old are most product managers? ›

Age Statistics in Product Management

54% were between the ages of 45 – 54. Interestingly, the same study conducted in 2019 showed that 34% of PMs were 30 – 39, and 34% were 40 – 49. 19% were in their fifties, and only 9% were in their twenties.

What are the two natural divisions of product management? ›

Often, product management is divided into inbound (product development) and outbound (product marketing) functions. As discussed earlier, the division into these categories depends on the type of product and the nature of the organization.

Who coined the term product manager? ›

History. The concept of product management originates from a 1931 memo by Procter & Gamble President Neil H. McElroy. McElroy, requesting additional employees focused on brand management, needed "Brand Men" who would take on the role of managing products, packaging, positioning, distribution, and sales performance.

What are the factors that affect product management decisions? ›

Product Mix: Top 10 Factors Affecting Product Mix
  • Profitability: Every business unit tries to maximize its profits. ...
  • Objectives and Policy of Company: Company frames its product mix to achieve its objective. ...
  • Production Capacity: ...
  • Demand: ...
  • Production Costs: ...
  • Government Rules and Restriction: ...
  • Demand Fluctuation: ...
  • Competition:

What is product evaluation? ›

The definition of product evaluation is to evaluate the quality of products in order to summarize experience as the guidance for follow-up design. Methods and process of user experience measurement are applied to the area of product evaluation.

What are the drivers of product evolution? ›

The 8 key factors involved in new product development are Knowledge Management, Market Orientation, New Product Development Process, New Product Development Speed, New Product Development Strategies, New Product Development Teams, Technology and Top Management Support.

What is origin and evolution of man? ›

Modern humans originated in Africa within the past 200,000 years and evolved from their most likely recent common ancestor, Homo erectus, which means 'upright man' in Latin. Homo erectus is an extinct species of human that lived between 1.9 million and 135,000 years ago.

How many types of product managers are there? ›

There are 3 different types of product management teams, namely – innovators, builders and tuners.

Who is the boss of a product manager? ›

CPO / Chief Product Officer

A Chief Product Officer (CPO) is the most senior product person in an organisation. They usually manage more than one team of product managers and represent product in the C-suite or management team.

What is product manager role? ›

A product manager is the person who identifies the customer need and the larger business objectives that a product or feature will fulfill, articulates what success looks like for a product, and rallies a team to turn that vision into a reality.

Why evolution of management is important? ›

Understanding the evolution of management thought is important as it helps determine what management principles and practices work best for your team and your organization. It can help you manage your team and workplace more effectively.

What is the importance of the history of management? ›

Management history is essential because it helps people learn from past mistakes, adapt to current strategy-execution challenges, and prepare for future issues.

Who contributed to the evolution of management? ›

Henri Fayol, a Frenchman, is credited with developing the management concepts of planning, organizing, coordination, command, and control (Fayol, 1949), which were the precursors of today's four basic management principles of planning, organizing, leading, and controlling.

What are the main components of product management? ›

Here are 7 essential components of product management, all of which are equally important to create a world-class product and make it successful.
  • Product Discovery/ Idea Management. ...
  • Product Specification. ...
  • Product Roadmap. ...
  • Product Prioritization. ...
  • Product Delivery. ...
  • Product Analytics. ...
  • Customer Feedback.
16 Jun 2020

What is an example of product management? ›

Product management examples also include the branding and customer communication required to launch a new product. Each product, in its nascent form, requires proper branding. This creates awareness about the product in the market. Advertising and PR handling also fall under the umbrella of product management.

What is product management according to Philip Kotler? ›

PRODUCT MANAGEMENT UNIT - 1. 2. CONCEPT OF A PRODUCT: Acc. to PHILIP KOTLER “A product is anything that can be offered to a market for attention, acquisition, use or consumption. It includes physical objects, services, personalities, places, organizations and ideas.

What is the difference between product and product management? ›

In short: product management is about the 'what,' while product development is more concerned with the 'how. ' Working alongside each other, product managers and product development teams create the ideal product.

Is product management a good career in 2022? ›

As more companies realize the need to focus on products, the field of Product Management continues to grow. LinkedIn listed Product Management as one of the fastest growing roles on the market in 2022 and Glassdoor announced Product was one of the 50 Best Jobs in America.

Do you need an MBA to be a product manager? ›

An MBA is not a requirement for landing a job as a product manager. However, due to current demand and high pay, more professionals will likely enter the field in the coming years, and employers may become more selective in their hiring processes.

What types of companies use product managers? ›

Product managers can be found at companies that are building products and technologies for external customers (consumers, end users, partners, etc.) as well as internal customers (employees). Product managers work closely with sales, support, marketing, and engineering to deliver the best possible customer experience.

What makes a product manager successful? ›

The easy answer to this question — “What makes a great product manager?” — would be a list of skills. A long list that would include: subject matter expertise, outstanding communication skills, market knowledge, leadership ability, innovativeness, strong researching skills, the ability to think strategically, etc.

Is product management a part of marketing? ›

Traditional consumer companies have always considered product management to be a marketing role, which is why it seems to make sense to put product management there. And it does make sense–if marketing is defining and delivering products.

Can a product manager become CEO? ›

With hands-on experience in this approach, a product manager can prosper in an executive leadership position. In sum, product managers play a crucial role in product development and acquire the right skills that will help them flourish in their career and ascend to the CEO post.

Are product managers happy? ›

In general, product managers are happy at work and satisfied with their current position, rating their happiness at 3.8 on a 5-point scale. More significantly, only 9% of respondents ranked their happiness a “1” or “2,” indicating that very few product managers are unhappy.

Why are product managers paid well? ›

The demand for these professionals is high in the market and many companies pay handsome amounts for this role. That's the primary reason product manager salary in India is quite high. The ever increasing demand.

What a good product management must do? ›

A product manager must: Coordinate cross-functional teams to ensure all team members are on the right page. Be a decision-maker using strategic thinking and guidance from the product team. Work with the product team, the engineering team, customer support, the sales team, and other teams to ensure a strong product ...

What are the benefits of product management to the business of the company? ›

5 Benefits of Product Management
  • Strengthen collaboration between internal teams. ...
  • Have a universal translator for technical information. ...
  • Clearly defines expectations. ...
  • Aligns market needs. ...
  • Reduces risk of product failure.
5 Jan 2017

Who is higher than product manager? ›

Yes, a product lead is higher than a product manager.

They'll interact and liaise with employees across different departments such as marketing and research. Product leads tend to come from more of technical background and bring remarkable knowledge of a product and its audience to the company.

Who is the father of product management? ›

Neil McElroy from Procter & Gamble (the man who also helped found NASA by the way) is often pegged as the man behind modern Product Management after he wrote a now-famous 3-page company memo on the principles of brand management in the 1930s.

What is a founding product manager? ›

The role for a first product manager is often created after a company raises a seed stage or series A. At this point the founder or the head of product has gotten the company to a place where early adopters are using it, and hopefully some revenue is coming in the door.

What do you study in product management? ›

Education Requirements

The education level required to apply for many product manager positions is a bachelor's degree in business or a related field. Product manager degrees should include coursework in communications, marketing, economics, public relations, statistics, advertising and management.

When did product management begin? ›

Modern product management started in 1931 with a memo written by Neil H. McElroy at Procter & Gamble. It started as a justification to hire more people (sound familiar to any product managers out there?) but became a cornerstone in modern thinking about brand management and ultimately product management.

What are key product management decisions? ›

With every product, regardless of where it is in its lifecycle, there are certain key decisions that must be made, perhaps repeatedly. These decisions include specifying product features, package design, branding decisions, establishing related services, and legal considerations.

What are the 7 factors that influence a decision? ›

7 Factors and Personal Characteristics That Have an Impact on the Decision Making In an Organisation
  • Programmed versus non-programmed decisions:
  • Information inputs:
  • Prejudice:
  • Cognitive constraints:
  • Attitudes about risk and uncertainty:
  • Personal habits:
  • Social and cultural influences:

Who coined the term product manager? ›

History. The concept of product management originates from a 1931 memo by Procter & Gamble President Neil H. McElroy. McElroy, requesting additional employees focused on brand management, needed "Brand Men" who would take on the role of managing products, packaging, positioning, distribution, and sales performance.

What are the 3 major areas of product management? ›

It identifies the three primary areas of focus for product management, namely: Product discovery. Product Planning. Product Development.

What is the concept of product management? ›

Product management is the job of looking after a specific product within a business. It's a role at the very heart of an organization that needs to balance the need to deliver value to your company (usually profit) with what customers want and what's technically and operationally possible.

What is product product management? ›

A product is an item or a service offered on the market and designed to meet the needs or wishes of customers. Products can be tangible goods, services, experiences, individuals, places, properties, organizations, information, and ideas.

What is the role of product management? ›

Product Management is responsible for defining and supporting the building of desirable, feasible, viable, and sustainable products that meet customer needs over the product-market lifecycle.

Why is product management important? ›

The Importance of Product Management

It's important because it helps the rest of the company understand the value of a product. It's essentially about knowing what will sell and how to turn a developed product into revenue. And it does that by understanding the customer.

What are the two natural divisions of product management? ›

Often, product management is divided into inbound (product development) and outbound (product marketing) functions. As discussed earlier, the division into these categories depends on the type of product and the nature of the organization.

What are the main components of product management? ›

Here are 7 essential components of product management, all of which are equally important to create a world-class product and make it successful.
  • Product Discovery/ Idea Management. ...
  • Product Specification. ...
  • Product Roadmap. ...
  • Product Prioritization. ...
  • Product Delivery. ...
  • Product Analytics. ...
  • Customer Feedback.
16 Jun 2020

What is an example of product management? ›

Product management examples also include the branding and customer communication required to launch a new product. Each product, in its nascent form, requires proper branding. This creates awareness about the product in the market. Advertising and PR handling also fall under the umbrella of product management.

What is product management according to Philip Kotler? ›

PRODUCT MANAGEMENT UNIT - 1. 2. CONCEPT OF A PRODUCT: Acc. to PHILIP KOTLER “A product is anything that can be offered to a market for attention, acquisition, use or consumption. It includes physical objects, services, personalities, places, organizations and ideas.

What industry is product management? ›

Many current product management roles are centered in the tech industry, but product managers can work within any business that makes, sells, or distributes a product — from automobiles to software, biochemicals, pharmaceuticals, and consumer goods.

What is the difference between product and product management? ›

In short: product management is about the 'what,' while product development is more concerned with the 'how. ' Working alongside each other, product managers and product development teams create the ideal product.

Videos

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6. Product Management: The new Era Between Past and Future
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