Why you should take care of your product ecosystem?

     

 

Partnership management – or living in the Ecosystem – is a growing area of interest for the product manager in Technology.

In one of my foundation level product management training courses I had a “student” who was just starting his first PM job. He mentioned that besides his responsibility for a product – he was asked to “take care of Ecosystem management” for the company...

Ecosystem management includes collaboration regarding requirements, development, marketing, sales, distribution and services. Or from a wider perspective – defining the business model for your company in relation to other commercial players and influencers.

Quite a task for a new employee!

Living in the Ecosystem

The product manager’s role is often described as an “orchestrator” or “leading without authority”. In the Ecosystem this goes beyond the borders of your own organization.

Very few contemporary technology products has an operational life far away from other products and solutions. On the contrary – we talk about “The whole product concept”. Meaning there is a need for a complete set of products and services from an entire Ecosystem in order to create meaningful value for a user.

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When enjoying some music from Spotify - the Swedish Tech Startup is not the only supplier involved. You might be using a phone from Apple, a headset from Sennheiser, the streaming data is transferred in a mobile network operated by Ericsson for the mobile operator Vodaphone - and so on...

The Business Model Canvas (Osterwalder & Al) is a commonly used tool to visualize how you partner in the Ecosystem. In the canvas there are even a dedicated box for “Key Partners”. In addition you would place sales and distributions partners (incl system integrators) under “Channels”.

I often use a simple whiteboard tool:

  • List all possible players in the Ecosystem on post-it notes
  • Place them on a white board with the (end) customer in the middle
  • Draw connectors representing who is invoicing whom in the chart
  • Add additional “influencer” arrows

This simple representation is a good starting point in understanding the financial setup of a value chain or more complex Ecosystem.

The Product Manager is an expert compromiser

Our British colleague Ian Lunn at Product Focus talked about the PM as The Expert Compromiser at the Product Leadership Day conference a few years ago.  Finding business setups that will give sufficient margins in your company.

product_manager_expert_compromiser

Major partnerships are often initiated and supported by executive managers. To make it work out however is often handled by individual PMs. It can be aligning requirements and features for products which are supposed to seamlessly work together as a solution.

I had the pleasure to work with a business development manager from a Scandinavian service provider. He had NO development resource – NOR ANY budget for external R&D.

Still – he succeeded to develop a complete range of innovative technology products.

How was this possible?

Well, since this blog is about partnering and the Ecosystem. He used his key assets – customer relations and INSIGHTS into their problems. Also read Increase innovation by leveraging your eco-system.

Then he approaches potential partners asking them to develop products solving “the problems of his customers”. They were happy to partner up since they didn’t have neither the domain insights nor access to sales channels to those markets.

Of course, apart from having limited ownership (he negotiated unique selling rights in Scandinavia), there was the question on Product Maintenance. Eventually a product support organization had to be put in place. But already having the business made convincing management and easy sell.

The world is waiting for the ambitious product manager! Scaling your business by leveraging local partners globally means faster growth!

About The Author

Erik has extensive experience in product management, business management and development. Within the software, electronics and hardware, Erik has pursued commercial success.