Product Mastery Now for Product Managers, Leaders, and Innovators Chad McAllister, PhD

How product managers can master product portfolio management

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TLDR

Portfolio management is a crucial aspect of product development that helps organizations strategically allocate resources, balance projects, and align their product innovation efforts with overall business goals. By understanding the essentials of portfolio management, product managers and leaders can better position their ideas, defend resources for their projects, and contribute to the organization’s success. This article explores the fundamentals of portfolio management, its goals, and frameworks for structuring portfolios, and provides insights on aligning product innovation projects with organizational strategy. It also discusses the importance of portfolio management for product managers, the characteristics and goals of portfolios, and the common approaches to linking portfolios to strategy.

Introduction

In the world of product development, portfolio management plays a vital role in helping organizations prioritize projects, allocate resources effectively, and ensure that their product innovation efforts align with the overall business strategy. As Peter Drucker famously stated, “Because the purpose of business is to create a customer, the business enterprise has two–and only two–basic functions: marketing and innovation.” Portfolio management is the key to driving successful innovation and creating products that customers love.

For product managers and leaders, understanding the essentials of portfolio management is crucial. It not only helps them better position their ideas and defend resources for their projects but also enables them to contribute more effectively to the organization’s success. By mastering portfolio management, product professionals can ensure that their organizations focus on creating the right products that drive innovation and deliver value to customers.

Understanding Portfolio Management

What is a Portfolio?

A portfolio is a collection of projects or products that a company invests in and manages strategically. These projects may or may not be related to each other and can be categorized based on various criteria, such as new product ideas, enhancements to existing products, fixes, or research and development initiatives. The portfolio represents the organization’s investment in innovation and its commitment to creating value for customers.



The Role of Portfolio Management

Portfolio management is a decision-making process that involves continuously reviewing and revising the list of active projects to ensure that resources are allocated optimally and aligned with the organization’s strategy. It aims to maximize the value of the portfolio, balance projects based on predetermined criteria, and maintain the right number of projects to avoid spreading resources too thinly.

Portfolio management operates in a dynamic environment where projects are at different stages of completion, and there is no certainty of success for each individual project. However, by managing the portfolio effectively, organizations can increase the overall odds of success across the full range of projects and products.

Why Portfolio Management Matters for Product Managers

Product managers play a critical role in driving innovation within their organizations. They are responsible for creating products that generate revenue, satisfy customer needs, and contribute to the organization’s growth. Understanding portfolio management is essential for product managers for several reasons:



* Positioning Ideas: By understanding the principles of portfolio management, product managers can better position their ideas and align them with the organization’s strategic goals. This increases the chances of securing support and resources for their projects.

How product managers can master product innovation strategy

Today we’re talking about product innovation strategy, one of the seven knowledge areas for product mastery. These are the knowledge areas that make us successful as product masters who know how to create new value for our customers. They also lead to more influence in our organizations. This is the third episode of a series where we’re diving into each of the seven knowledge areas.

Summary of topics discussed for product managers

Watch the full interview with PowerPoint slides on the Product Mastery now YouTube channel.

[2:30] What is strategy?

Strategy can simply be thought of as a plan to bring about a desired future.

[4:38] The Hierarchy of Strategies



* Mission Statement

* Corporate/Business Strategy

* Innovation Strategy

* Functional Strategy



[6:44] Creating a business strategy

[7:41] Business strategy as a basis for product innovation



* Business goals

* Contribution from innovation

* Specific strategic focus for innovation

* Attack plan and entry strategy

* Project portfolio selection and resource allocation



[9:59] What you need to know before developing a business strategy

Tools for strategic planning

[11:05] SWOT



* Strengths

* Weaknesses

* Opportunities

* Threats

* (Trends)



[12:56] PESTLE



* Political

* Economic

* Social

* Technological

* Legal

* Environmental



[13:37] Business Model Canvas

[17:22] Innovation Strategy

[18:26] A Good Innovation Strategy

[22:20] “I have a great idea but I can’t get support for it in my organization.”

Watch the full interview with PowerPoint slides on the Product Mastery now YouTube channel.

Put the information Chad shared into action now. Click here to download the Action Guide.

Useful links:



* Check out the 2024 Product Development and Management Body of Knowledge by Allan Anderson, Chad McAllister, and Ernie Harris

* Find out how the Rapid Product Mastery Experience, the fastest path to higher-performing product managers and teams, can help your team



Thanks!

Thank you for taking the journey to product mastery and learning with me from the successes and failures of product innovators, managers, and developers. If you enjoyed the discussion, help out a fellow product manager by sharing it using the social media buttons you see below.

How product managers can master product innovation management

Today we’re talking about product innovation management, one of the seven knowledge areas for product mastery. These are the knowledge areas that make us successful as product masters who know how to create new value for our customers. They also lead to more influence in our organizations. This is the second episode of a series where we’re diving into each of the seven knowledge areas.

Summary of topics discussed for product managers

Watch the full interview with PowerPoint slides on the Product Mastery now YouTube channel.

[2:06] What is product innovation?

PDMA defines product innovation as the creation and subsequent introduction of a good or service that is either a new or an improved version of previous goods or services. Product innovation involves creating value, which is judged by the customer.

[3:23] What factors influence product innovation?

There are four categories of factors that influence product innovation:



* Controllable



* culture

* strategy

* capability

* organizational structure

* finances





* Uncontrollable



* competitors

* government policies and regulations

* international environment





* Internal



* board

* management

* marketing

* production

* finance

* purchasing





* External



* consultants

* suppliers

* regulators

* agents

* trade

* customers







[5:19] Why is product work hard?

Successful product innovation is challenging because it doesn’t just happen by accident. As much as 70-90% of consumer products fail to meet their revenue expectations.

This means organizations are wasting financial and human resources at a tremendous rate. Your competency with these concepts in the Body of Knowledge helps equip you to turn this around and be more successful creating products customers love and that generate revenue for your organization.

Some famous examples of failed product launches that missed some aspect of product innovation are:



* New Coke

* Apple Newton

* Blackberry phone

* Nintendo “Virtual Boy”

* Segway

* Gerber “Adult” Food “Singles”



[7:20] What factors influence product innovation success?

I want you to be aware of success factors at three levels:



* project

* people and environment

* strategy



[7:39] Success factors at the product project level



* Develop unique, superior products, not me-too products

* Have a clear focus on a target market segment

* Do your pre-development homework

* Develop a clear, concise and stable product definition from the beginning

* Adequately plan and resource the launch

* Execute with speed—but not at the expense of quality of execution. This creates a tension that product teams live with—speed with quality



[9:01] Success factors at the people and environment level



* Organize project teams to fit the constraints and complexity of the project

* Create the proper climate and culture to support innovation and remove innovation barriers

* Enlist top management support



[9:35] Success factors at the strategy level



* Have a product innovation and technology strategy that is aligned with organization strategy

* Leverage core competencies

* Target attractive markets

* Use portfolio management

* Use the necessary resources for each project



[10:34] What does research tell us about product innovation success factors?

The PDMA Comparative Performance Assessment Study has ...

The essential knowledge areas that give product managers more influence and success

Today we’re talking about the seven knowledge areas for product mastery. These are the knowledge areas that make us successful as product masters who know how to create new value for our customers. They also lead to more influence in our organizations. This is the beginning of a series where we’ll dive into each of the seven knowledge areas.

Summary of topics discussed for product managers

Watch the full interview with PowerPoint slides on the Product Mastery now YouTube channel.

[1:14] Who is Chad McAllister?

I’m a product management professor, practitioner, trainer, and host of the Product Mastery Now podcast.

[3:19] Chad’s path to product management



* Worked in software project management

* Became fascinated with why we sometimes miss the mark in developing products for customers

* Earned a PhD in Innovation to study this problem more deeply

* Discovered the Product Development and Management Association (PDMA)

* Learned the PDMA product management and product innovation Body of Knowledge (BoK)

* Created an online training system for people to learn the BoK, including the seven knowledge areas

* Contributed to the BoK, which is now complied in a book released every few years



[13:40] Co-author of the 2024 edition of the Product Development and Management Body of Knowledge: A Guidebook for Product Innovation Training and Certification

[15:31] Why did Chad co-author the 2024 BoK?



* I value the BoK and want to improve it

* Opportunity to give back to the product management community

* Not for book royalties—all sales support PDMA, a non-profit organization



[17:10] Who is the BoK for?



* Product managers, innovators, or leaders seeking comprehensive guidance on the required disciplines for increasing the success of product innovation

* Those planning a new career in product or innovation management

* Everyone committed to earning the New Product Development Professional (NPDP) recognition to demonstrate their understanding of product innovation



[21:55] Why might you be interested in the BoK?



* Product professionals need a proven framework to fill gaps in their knowledge while also deepening their understanding

* The BoK provides an established framework for a wide cross-section of product and service industries at various levels of an organization

* Only PDMA can provide this, based on researching and curating the body of knowledge since 1976



[26:23] What’s next?

Over the next few weeks, we’ll discuss the seven knowledge areas:



* Product Innovation Management

* Strategy

* Portfolio Management

* Process

* Design & Development

* Market Research

* Culture & Teams



Watch the full interview with PowerPoint slides on the Product Mastery now YouTube channel.

Put the information Chad shared into action now. Click here to download the Action Guide.

Useful links:



* Check out the 2024 Product Development and Management Body of Knowledge by Allan Anderson, Chad McAllister, and Ernie Harris

* Find out how the Rapid Product Mastery Experience,

The habits that set apart transformational product leaders

Today we are talking about why organizations are increasingly facing the need to transform and how to navigate those changes. If you have experienced a big change, you already know firsthand how challenging it is. All of us need to know the principles that make transformations successful, and that is what we’ll takeaway from this discussion.

Joining us is John Rossman, who was an early executive at Amazon and led the launch of the Amazon Marketplace (which allowed third-party businesses to sell on Amazon). He is a four-time author including best seller “The Amazon Way” and “Think Like Amazon,” as well as a sought-after business advisor and keynote speaker. His expertise is on leadership for innovation and business transformation.

His most recent book is Big Bet Leadership: Your Transformation Playbook for Winning in the Hyper-Digital Era.  

Summary of some concepts discussed for product managers

[2:41] What advice have you received that helped you think about how to have more successful influence in the organization?

I had a longtime business partner, Steve, who told me, “After Amazon, your superpower is always clarifying and simplifying the discussion, the meeting, or the communication.” I recognized from Steve that one of the things I learned at Amazon was how to clarify and simplify. Especially in a complex situation, the person who can clarify and simplify the communication is the controller of the situation.

After I left Amazon, one of my key clients was the Gates Foundation, and Greg Widmyer told me, “You do a really nice job taking the little strategies, inserts, and mechanisms from Amazon and delicately implementing them and influencing our work. I think you ought to write a book about it.” The ability craft a story and influence others at scale through a book was a great piece of advice and something I had never thought about before.

[5:48] What are Big Bets and why are they important to organizations?

A Big Bet is any initiative, strategy, or project that both has the potential for significant business impact and business upside and has significant multi-sided risks or assumptions. They are not simple initiatives or straightforward capabilities.

Big Bets typically happen at the enterprise level but can happen at the team or product level. They get called lots of things like market repositioning, merger integration, digital transformation, AI strategy, etc.

Big Bets have a 70-85% failure rate, but those are all errors of commission where an initiative was taken and it didn’t work as scheduled. The biggest failure point is typically the benefits. But those statistics don’t count the errors of omission where a Big Bet was needed but one wasn’t taken. When you see a company go from great to average or from average to irrelevant, a Big Bet was needed.

The framing of my book, Big Bet Leadership: Your Transformation Playbook for Winning in the Hyper-Digital Era, is critical to answer the question, why are Big Bets needed? It’s my hypothesis that these past 30 years of digital change has been the warmup innings for the next era, which we call the hyper-digital era. The companies that can make a core capability out of transformational change, high potential impact, and high risk will win. In addition to being operationally excellent and great at incremental moves, they are going to be great at these transformational capabilities, these business model changes that are so essential. Those are the Big Bets.

[9:33] Tell us about solving wicked problems.

If you asked me, “John, what are you good at?” I would say I’m good at solving wicked problems—multi-sided, non-obvious problems. Technology is just one of the mega forces that I think will drive this next era. Mega forces include change, labor force,

Tools for making voice-of-the-customer insights more accessible to product managers

Today we are talking about aspects of the Market Research knowledge area for product mastery. Specifically, we are discussing how to overcome challenges collecting actionable customer insights.

Helping us with this is Prashant Mahajan, the founder of  Zeda.io. Prashant is an experienced product manager and leader, having guided product development in several organizations.

In these experiences, he identified a critical gap: Many Product Managers are unsure if they are building the right products because they can’t access customer feedback, customer insight, or sentiment. This led him to developing Zeda.io, which is also focused on the importance of publicly sharing product roadmaps and progress with customers.

Summary of some concepts discussed for product managers

[2:52] You founded Zeda.io to help product managers capture the voice of the customer and get actionable customer insights. What challenges did you encounter as a product manager that gave you experience for improving how to gain customer insights?

We learn about product management best practices, like solving customer problems and making a strategy, but most of the product management I saw in companies was about operations. Updating an Excel sheet or going to a meeting was taking up too much of my mental bandwidth. I thought there could be a better way to do product management, where operations are taken care of by software. We took inspiration from GitHub AI Copilot and Chat GPT. We started with the vision to make product management simpler and smarter.

Product management can be divided into product discovery, prioritization, building, and launch. Most product people are good at building things, but they don’t know what problem to solve. If people knew what to build, we would not see companies launch useless products and fail.

I experienced these challenges firsthand in my previous company. You get input from sales, support, customer-facing teams, and user research. As the company becomes bigger and bigger, the distance between the product team and the user keeps increasing. Meeting with people is like playing Telephone, and by the time you get information, it might be four or five people away from the customer. You can’t go to one place and find out what your customers are asking. I wanted to make a platform where you can centralize the customer voice, analyze it, generate insights, and make the key takeaways actionable.

The product team, including designers and engineers, needs to know why they are building things. If you tell them the problem and the impact of solving it, they can brainstorm together and ship it out. It’s critical that you’re using your resources for the right problem, which will create impact, and not just randomly building things.

[10:24] After you built a product to solve your problem, how did you validate the pain points and core problems for the larger product management community?

I am a strong proponent of talking to people. In the last three and a half years, I have had a call with a product leader on average every day. I’ve talked to CPOs, VPs, and people who have just started as the first PM at a startup.

The core problem as a product leader is there are so many ideas and a lack of confidence on deciding which idea to pursue. You need to justify the ROI of building a product.

One CPO said he needed our product to be insurance for his job. If the product didn’t work, he would be fired. He needed the data to save his job.

[14:18] How does your product at Zeda.io help product managers?

We focus on product discovery and planning. We centralize all your customer voice or input from customers and customer-facing teams in one place so you don’t have to juggle meetings and Excel sheets and you don’t lose any informa...