ManageEngine's product management framework
A framework is the foundation upon which teams must collaborate and build their strategy. While each product team follows its own process, this framework gives an overall view of what a successful product release calls for. For those who don't know where to begin, having a SaaS product management framework in place helps cover all the bases.
However, like any framework, it must be flexible enough to reflect changes in the market, user feedback, and other variables.
SaaS product management framework
Stage 1: Problem identification
This phase begins with a problem statement, a concise description of an issue that needs to be addressed or a condition that can be improved. It helps identify the gap between the current state and the desired state and explain the significance of addressing this gap. Product managers must craft a problem statement that includes four main components: the description of the problem (or a hypothesis), its impact on users, the scope and objectives of the solution, and how the product's success is measured.
Problem-solving frameworks—like root cause analysis (RCA), The Phoenix Checklist, and CIRCLES—can be used to narrow down the problem, analyze every aspect of it, and communicate the results with stakeholders. If it works for Google and the CIA, it will work for you too.
Stage 2: Prototype validation
In this stage, PMs work on creating a minimum viable product (MVP)—a lean version of a product. While it isn't complete, it includes the core features necessary to address the primary problem and provide immediate value to users. An MVP is focused on rapid iteration, designed for early adopters to improve the product to the next level.
When does a product team need an MVP?
- When testing a new idea
- When entering a new market
- When seeking external investment or internal buy-in
- When reinventing existing products
- When the team is working with limited resources
- When the product concept involves high risk or uncertainty
Once an MVP is built and introduced to real users, product teams must validate that the prototype works as intended. This can be done by monitoring metrics like user retention, session duration, and feature usage. Additionally, gathering qualitative feedback through focus groups, beta testing, and A/B testing can help PMs gain insights into their experiences and determine which user flow works best. Lastly, iteration. Look out for recurring themes and patterns in user feedback and prioritize those issues.
When all this is complete, you may find yourself working with a completely different version of the product than what was envisioned. Evaluate the MVP’s performance against the validation criteria and objectives set initially. There are three ways to move forward. One, move in the current direction. Two, pivot to a different approach. Or three, in some cases, shelve the idea if the results are not promising. If the performance meets expectations, the product can move to the next stage.
Stage 3: Product-market fit
When the solution you've built successfully meets the needs and demands of a specific market segment, you've hit the jackpot. Achieving product-market fit (PMF), as rare as it can be, is a crucial milestone for long-term growth. Take ManageEngine for example. Before we established ourselves in the cloud space, we had WebNMS (a subsidiary of AdventNet) to meet the IT needs of telecom customers. WebNMS was doing fairly well for over five years, but the market disappeared—forcing us to change our approach and focus on different markets with new products. In other words, having the right product in the wrong market and having the wrong product in the right market are both ways to set yourself up for failure.
Steps to achieve product-market fit:
- Understand your target users' needs
- Identify and validate value proposition
- Build a lean version of the product
- Iterate based on feedback
- Measure key metrics
- Refine product positioning
- Scale and market the product
- Maintain alignment
How do you know you've made it?
By tracking KPIs and actively seeking customer feedback, product managers can assess how well their product meets market needs and identify areas for improvement. This involves metrics like trial-to-paid conversion rate, churn rate, retention rate, and revenue growth. A good example of PMF measurement is the Sean Ellis test:
Question:
"How would you feel if you could no longer use this product?"
Responses:
- Very disappointed
- Somewhat disappointed
- Not disappointed
Analysis
If 40% or more respondents say they would be "very disappointed," it's a strong indicator of product-market fit.
Stage 4: Product strategy
For a product to succeed at serving its purpose, product teams must have clarity in their product vision and objectives. A product strategy framework is a great way to establish a strong foundation for product development and keep the focus customer-centric.
This means having answers to questions like:
- What is the purpose of this product?
- How will it impact users?
- What are its functions?
- What is our differentiation factor or unique selling proposition (USP)?
Say you're cooking a gourmet meal. What's the first thing you need? A recipe. It lists the ingredients, specifications, and steps to create the dish. It ensures that you measure the right quantities, combine them in the right order, and serve up a restaurant-worthy dish. When you're creating a product, the strategy ensures that the right resources are used effectively, tasks are completed in a suitable sequence, and the final product meets customer expectations. Your product strategy is the recipe for the success of your product.
Once these details have been ironed out, determine the pricing model that suits the USP, target market, and competitor offerings. Common pricing models for SaaS solutions include subscription-based pricing, usage-based pricing, freemium models, and tiered pricing. At ManageEngine, we offer a combination of free, subscription-based, and tiered pricing, depending on the organization's size and requirements.
Flate-rate
Offers one product with a set of features for a fixed monthly or annual fee. A one-size-fits-all strategy with easy and focused marketing.
Tiered
Offers versions of a product at varying packages, depending on the customers’ requirements. Most convenient for upselling.
Usage
A pay-as-you-go model that charges customers based on their usage. An affordable and customizable plan.
Freemium
Users have access to a limited version of the product for free and must pay to upgrade and access all available features.
Feature
Customers are charged based on the number of features they choose. A straightforward plan that encourages upsell.
Per user
Offers a fixed fee based on the number of users per month. A simple plan that increases revenue as an organization grows.
Popular pricing models used by SaaS companies
Stage 5: Product roadmap
A product roadmap is a visual guide that provides a high-level overview of the direction, priorities, short-term, and long-term goals of the product. This includes planning the release, managing dependencies, and providing stakeholders with clarity in responsibilities and estimated timeframes. Roadmaps can be depicted through Gantt charts, Kanban boards, or timeline diagrams to convey complex information and facilitate understanding among stakeholders.
Feature prioritization
Product requirements are never-ending lists. There's always a feature that needs enhancements and new ones in the pipeline. How can product managers prioritize their work? Features are typically prioritized based on the organization's business objectives, user feedback, and market demand. Select features that have the highest strategic value and impact on achieving key goals. If it's a new product that currently does not have customer input, prioritization frameworks like RICE, the Kano model, and the MoSCoW method can help teams streamline work.
RICE prioritization framework for product management
|
M |
Must have |
Non-negotiable features without which the release cannot move forward. These can affect the project's viability, security, and/or legality. Must-have features are critical to the delivery timeline. |
|
S |
Should have |
Features that may not be as vital as must-haves but are important requirements nonetheless. The product can still function without it but must be in the product's long-term vision or a part of the next major release. |
|
C |
Could have |
"Nice to have " features that can be included in future releases. Their impact is minimal. However, they can be implemented at little cost to improve user experience. |
|
W |
Will not have |
Features that aren't feasible or offer little to no value to the product. They will not be a part of upcoming releases but can be considered in the future if circumstances change. |
MoSCoW prioritization method
At ManageEngine, support agents monitor tickets on the in-house help desk for feedback that may help the product management team. These are marked for review and pushed to a repository handled by the product managers. In most cases, there are multiple scenarios or problems that can be solved by one feature or module. So, the tickets are sorted according to the module and stored in the repository for continuous monitoring. A dashboard reports the number of requests for each feature. This helps our product management teams prioritize features.
Release planning
Product or feature releases require a definitive timeline. Managers can break down the product roadmap into manageable release cycles, such as quarterly or monthly increments, with milestones set for each release. Milestones are determined based on key deliverables. These can include stages like design completion, development sprints, testing phases, and beta launches. Releases also require extensive collaboration with cross-functional teams, so it's crucial to sequence tasks, address dependencies, and minimize potential bottlenecks before development begins.
Resource allocation
Following release planning, we focus on the classic SaaS trio—people, process, and technology.
- People: Assess the capacity of the product team, including developers, designers, QA testers, and other roles. Take into account any ongoing projects, internal requirements, and overlapping roadmaps.
- Process: Allocate a budget for various phases of product development, marketing, and support activities. Expenses for marketing activities, in particular, can add up quickly, so product managers must collaborate with the marketing team to optimize their budget.
- Technology: Identify and secure the tools required for development, testing, and deployment. Work with sysadmins to ensure there are no hiccups in acquiring tools and the licenses required are up-to-date.
Communication plan
The fundamental quality of a roadmap is its accessibility. Presentations are a reliable way to keep stakeholders informed about the roadmap, highlighting key features, timelines, and expected outcomes. Progress updates can be provided through meetings, reports, and dashboards. Ensure that these changes are also updated in the presentation, making it a single source of truth for all active members in the project. To further establish a two-way channel of communication, product teams can hold feedback sessions to gather input and make necessary adjustments to the roadmap.
Stage 6: Research and ideation
At the heart of product management is a relentless focus on the customer. Before we work on a product, we must understand the why of it all. Why should we offer this solution?
Key components for answering the why
To identify the problem we wish to solve, product management teams should take into account two key components: market analysis and user input. All the data collected at this stage is consolidated to give product managers the big picture.
1. Market analysis
- Industry trends: Product managers require a clear understanding of emerging trends and technologies, identify patterns in market growth, and assess evolving customer preferences. For instance, the post-pandemic SaaS market saw an uptick in AI-based solutions and features, especially with the launch of OpenAI's ChatGPT.
- Competitive analysis: Evaluate competitors to gain insights into their product offerings, pricing strategies, and advantages. A SWOT (strengths, weaknesses, opportunities, and threats) analysis can help identify gaps and potential avenues.
- Market segmentation: Divide the target consumers based on factors such as company size, industry vertical, and geographic location. Ideally, the product positioning should be tailored to address the specific needs and pain points of each segment.
2. User input
- Surveys and feedback: There are multiple avenues for sourcing customer input like support tickets, community forums, and focus groups. Additionally, interacting with existing customers through surveys or interviews can give product managers a sense of direction at this stage.
- Usability testing: Beta testing programs can help product managers evaluate the user experience (UX) of the feature or product. Observe how users interact with the tool, identify usability issues, and gather feedback on design improvements.
- Persona development: Create user personas or journeys based on common characteristics and user goals. Personas here are fictional characters that embody the target demographic, their preferences, and pain points. Developing a storyline can help teams empathize with users and design solutions tailored to their needs.
A sample user persona for a project management tool
Product requirements document
The next step in this stage is creating a product requirements document (PRD), a guide that outlines the specifications for a new product or feature. It serves as a blueprint for development, ensuring that all stakeholders have clarity on what needs to be built, why it needs to be built, and how it should function. PRDs are also a great way to identify and mitigate risks before commencement. Ideally, a PRD should contain:
- WHAT: A high-level overview of the product, including its purpose, objectives, and strategic importance.
- WHY: The rationale behind the product, including market research, user needs, competitive analysis, and business goals.
- WHO: The target users, user personas and use cases, and scenarios that demonstrate how users will interact with the product. It should also list the stakeholders involved in the project and their responsibilities.
- HOW: The scope, acceptance criteria, requirements (functional, non-functional, and technical) and external dependencies in relation to the project. Most importantly, a visual representation or mock-up of the product or feature is crucial for a PRD. Any supporting documentation can also be included.
- WHEN: A tentative timeline, including key milestones, deadlines, and phases of development to manage expectations.
Stage 7: Product development
Product management's role in this stage is to oversee and coordinate the development process, ensuring that the product is built according to specifications, meets quality and compliance standards, and is delivered on time. They help define the scope of work for each sprint, clarify user stories, and set priorities based on the product roadmap.
Proof of concept (PoC)
Before developers get to work, they must come up with a PoC, a preliminary version or prototype of an idea that is used to demonstrate feasibility. It serves as a validation step to confirm that the concept can be practically implemented before committing resources to development. A PoC is integral for product management as it helps secure buy-in from internal stakeholders (including PMs) with factual evidence and identifies potential technical, operational, and financial risks in the early stages.
A detailed PoC should move as follows:
- Objectives: An overview of the project, its goals, target users, and key questions that must be addressed.
- Scope: Critical functionalities, features, and boundaries, such as user access levels.
- Hypotheses: Assumptions related to the product's performance, scalability, user experience, or security.
- Methodology: Discussions on the approach, timeline, and resources required and estimated cost.
- Deliverables: Tangible outputs expected from the PoC, like performance/feasibility reports, integration proofs, or security assessments.
- Risks: List potential risks, such as compliance issues or integration challenges, and outline the strategies to mitigate the risks.
- Stakeholder involvement: Elaborate on roles and responsibilities and when each team will be involved.
What is the difference between a POC, PRD, and an MVP?
While all three are crucial to the success of a product, each serves a different purpose at various stages of the product development lifecycle. Here's a brief comparison based on key aspects.
| Aspect | Product requirements document (PRD) | Proof of concept (PoC) | Minimum viable product (MVP) |
|---|---|---|---|
|
Purpose |
Provide specifications for development |
Validate the feasibility of an idea or technology |
Test market demand with a functional version of the product |
|
Scope |
Comprehensive, high-fidelity |
Limited, low-fidelity |
Limited but practical |
|
Benefits |
Development roadmap, project management |
Decision-making, risk reduction |
Early user feedback and market validation |
|
Development effort |
Low |
Minimal |
Moderate |
|
Audience |
Development and product/project teams |
Internal stakeholders, decision-makers |
Early adopters, customers |
|
Investment and risks |
Variable |
Low |
Variable |
|
Outcome |
Detailed guidelines for complete development |
Feasibility report or basic prototype |
Functional product |
|
Success criteria |
Product meets specified requirements |
Proof that the concept works |
Product meets user needs and gains traction |
The development process then begins with the selection of a development methodology. The main factors to evaluate when selecting a framework are:
- Project scope and requirements
- Team size and structure
- Customer involvement
- Organizational culture
- Development speed and delivery
Common product management frameworks
Let's review the four most commonly used frameworks in product management.
1. Agile
Agile is a flexible approach to product development that is designed to handle changing requirements and deliver value incrementally. Products are developed in small cycles called iterations or sprints, typically lasting one to four weeks. Agile methodology involves close collaboration between cross-functional teams and stakeholders, with a priority on the most valuable features.
Agile is a suitable approach for teams with:
- Evolving or unclear requirements
- Small/medium strength
- High customer involvement
- Continuous improvement culture
- Demand for quick delivery and regular updates
2. Waterfall
Waterfall is a linear and sequential approach to product development where each phase must be completed before the next one begins. It progresses through a series of predefined phases with comprehensive documentation at each step. Waterfall is a milestone-based approach where progress is measured through the completion of milestones. Each phase serves as a checkpoint.
Waterfall is a suitable approach for teams with:
- Well-defined and unchanging requirements
- Large strength
- Limited customer involvement
- Clearly established hierarchy
- Less urgency for rapid releases
3. Kanban
Kanban is a visual workflow management methodology where tasks are initiated based on capacity and demand, rather than being pushed through predetermined schedules. With work in progress (WIP) as the focal point, it limits the number of ongoing tasks at any given time to prevent overload. Kanban optimizes the flow of tasks for continuous delivery.
Kanban is a suitable approach for teams with:
- Flexible timeframes
- Small strength
- Moderate customer involvement
- Incremental development culture
- Requirement of identifying bottlenecks in real time
4. Scrum
Scrum is a subset of the Agile framework that emphasizes specific roles, ceremonies, and artifacts to manage the development process. It typically involves a product owner, who is responsible for the product backlog, a scrum master to facilitate the process, and developers that handle other tasks. There are four main ceremonies that comprise a sprint.
- Sprint planning: To define sprint goals
- Daily stand-ups: Short daily meetings to discuss progress
- Sprint review: A demo of completed work
- Sprint retrospective: To review and improve the process
Scrum is a suitable approach for teams with:
- Projects that can be broken down into sprints
- Small, cross-functional collaboration
- Heavy customer involvement
- High discipline to adhere to ceremonies
- Demand for rapid delivery
It is worth mentioning at this point that there are multiple other frameworks such as rapid application development (RAD), Lean, Scaled Agile Framework (SAFe), and Crystal Agile Framework. These methodologies may also be combined and implemented in a hybrid system if the team's operations call for it.
Throughout the development process, product managers hold numerous responsibilities, such as:
- Monitoring the completion of tasks using project management tools. They maintain visibility and confirm the team stays on track with timelines and deliverables.
- Participating in sprint planning meetings to align ongoing work with the roadmap.
- Managing the backlog to validate critical features are developed first.
- Coordinating testing and user acceptance testing to escalate critical issues and work towards timely resolution.
- Ensuring that all relevant documentation (e.g., technical specs, user guides, and API docs) is created and maintained throughout the development process. The writers in the product management team can assist with content generation—both technical and marketing content.
Stage 8: Product launch
The product launch can be split into two phases: pre-launch and post-launch activities.
As part of the pre-launch activities, the product management team must collaborate with the marketing team to create a detailed GTM plan to generate buzz around the launch. The PM's role here is to provide clarity on the target audience, key messages, and positioning of the product. They must also prioritize launch readiness; i.e., ensure that internal teams—including sales and customer support—are well prepared and all launch preparations are in place, including documentation, training, and marketing materials.
On launch day, the product management team's entire focus is on orchestrating a seamless rollout. This includes coordinating with the development team for deployment, monitoring systems for issues, and ensuring that marketing campaigns go live as planned. They should be prepared to address any issues that arise and engage with customers in real time.
Stage 9: Monitor metrics
After product rollout, product managers must monitor metrics that can help improve user experience, enhance product performance, and make strategic decisions. These metrics can be broadly categorized as:
- User acquisition: Sign-up rates, conversion rates, and referral rates
- User engagement: Active users, retention rates, churn rates, and session metrics
- Product performance: Feature usage, bug reports, and time-to-value (TTV)
- Financial performance: Monthly/annual recurring revenue, customer lifetime value, and revenue churn rate
- Customer feedback: NPS, CSAT, CES, and support metrics
The North Star Metric (NSM) is another crucial factor in data-driven decision-making. It is a single, measurable representation of a product's success and long-term growth. It is a leading indicator that reflects the core value derived by the user and is directly tied to customer experience. When there's a tangible value assigned, the product is accountable to the outcome of that metric and provides more clarity into the product's future than measures like revenue. The NSM varies across products. In SaaS, it could be the number of daily active users (DAU), number of records created, number of interactions, etc.
It's important for PMs to have a singular focus that aligns with business goals for sustainable success.
Stage 10: Feedback implementation
After gathering metrics and feedback from users, product managers are left with a treasure trove of information. Only question now is, how do we maximize its value?
The answer: continuous iteration.
Identify recurring themes and issue in the user feedback. These are key insights that can be categorized as actionable and non-actionable items. Here, we go back to the first stage and use prioritization frameworks like RICE and MoSCoW and focus on changes that would most likely have the highest potential impact with reasonable effort. This feedback then is included in the product roadmap to make enhancements in the next release cycle. Communicate the changes to stakeholders and gather their input as well.
A continuous improvement mindset is a must-have for product managers and the teams. It is the only way to create a more responsive and successful product that meets the needs of its users and thrives in a competitive market. It ensures a higher quality output through incremental improvements and supports sustainable growth.
Vital skills for product management
- Strategic thinking
- Continuous learning
- Research and analysis
- User-centricity
- Prioritization
- Data-driven decision-making
- Cross-functional collaboration
- Soft skills like communication and empathy
Domain-specific understanding for SaaS PMs
- Subscription models: A deep understanding of subscription-based business models is mandatory when offering cloud solutions. As mentioned earlier, product managers also need to work with pricing models, tiered plans, and freemium offerings to identify the best fit for users and maximize customer lifetime value.
- Cloud infrastructure: This includes familiarity with cloud computing concepts and services provided by platforms such as Amazon Web Services (AWS), Microsoft Azure, or Google Cloud Platform (GCP).
- Usage analytics and insights: SaaS product managers should leverage usage analytics to gain insights into user behavior, feature adoption, and product performance. Data-driven insights help identify opportunities for product improvement, prioritize features for development, and optimize user experience.
- Data security and compliance: SaaS product managers must prioritize data security and compliance with regulations such as GDPR, HIPAA, or SOC 2 when working on a new product or feature.
- Development and deployment practices: Collaborating closely with internal teams to automate deployment pipelines requires understanding of practices like continuous deployment, site reliability engineering (SRE), and Agile methodologies.
- Marketplace and ecosystem development: Exploring opportunities like marketplace applications, development portals, and partner ecosystems around an organization's solutions is—once again—an emphasis on customer-centricity. It facilitates integrations that benefit customers, extends the product's reach, and provides long-term value.
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