Lead on Purpose

Promoting Leadership Principles in Product Management


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Leadership styles for directing small teams

Leadership differs depending on the size of the group you’re leading. For most product managers, the people they lead work on different teams and the individuals they need to influence don’t report to them. Regardless of whether the people you lead (or should be leading) report to you, the need to lead soundly is important.

Understanding more deeply your style of leadership will help you lead more effectively. The work will go better, and you’ll enjoy it more.

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It’s the people

Everybody knows it, and yet too many executives, VPs, managers or other so-called “leaders” seem to forget: it’s the people that make the organization successful. It’s too easy to focus on the products or the projects and lose track of the people who are doing the work. Here are three quick tests you can take to determine whether, for you as a leader, it’s really about your people:

  • Commitment to the organization: Why do your team members work for your organization? Do they believe your vision? Do you inspire them? Are they sticking around only because the economy’s tough and they’re scared to look for another job? If they had a choice, would they work for you?
  • Career goals: What goals are your team members working towards in their current position? What drives them? Why do they get up every morning and come to work for you?  What are their career aspirations? What are you doing to help them advance? (Hint: if the answer is “nothing” they won’t stay with you long.)
  • Personal life: What do your team members like to do in their spare time? Where do they hang out? What are their hobbies? Are they married? How many kids do they have? And maybe the most important question…does their spouse like you?

If you can answer all of these questions (without having to ask), you care about your people. If not…you have some work to do. Your next presentation to the CEO isn’t nearly as important as the next meeting with your team.


The Product Management Perspective: Though it’s a bit different for product managers (because they don’t “manage” people), it’s still important to get to know the team members. The better you know them the more effective you will be at inspiring them to do great things. If they know you care they will definitely go out of their way to make you successful.


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Leadership — what you leave

How do you measure the effectiveness of leadership? A few common methods include:
  • The number of people reporting up through the organization
  • The quantity or amount of product or services produced
  • The “bottom line” or income produced by the company
  • The number of links, references or accolades to the leader or the organization
  • Other methods that focus on things and not people.

These are all valid and important ways to measure leadership, and many others exist. However, the true — and more telling — measure of leadership is long-term and cannot easily be seen. Leadership is best measured by what you leave behind.

Some people become frustrated by the lack of immediate results. The thought of waiting months or years to see the results of their labors is discouraging. However, if you look at the actions and attitudes of people whom you consider true leaders, you will find they focus on building others. They put as their first concern the growth and development of the people with whom they interact. The results of their success carry forward through the people they have influenced over the years.

The Product Management Perspective: Product managers have a great opportunity to lead and influence others in their company. This opportunity grows out of the fact that PMs work closely with many people from other teams throughout the company. While working with others can be frustrating (do I hear sales?), if we keep a long-term perspective and focus on how we can help them and make a difference in what they do, the long-term benefit will remain with us as we move forward.


The theme for this post came from a talk by David A. Bednar.


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Three P’s of business success

What is required to create a successful business? The answer to this question varies greatly depending on experience, industry and many other factors. Achieving business success seems highly complex at face value. However, the principles that lead to success are not necessarily complex or difficult. When you focus on the right areas and create a culture to support them, success comes naturally. Lee Iacocca, a business executive best known for his revival of Chrysler Corp. in the 1980s, put it this way: “In the end, all business operations can be reduced to three words: people, product and profits. People come first.” With the right ‘business operations’ in place, your company will achieve success:

  • People: In any company or organization, the real assets are the people. Their intellect—along with personality, skills, knowledge, character, integrity, and other things collectively referred to as “human life value”—create the true value in any organization. When you regard the people as the true assets of the company, and treat them accordingly, they will respond in ways that will surprise and delight you. As the leader of your company, put the people first and you will reap great benefits.
  • Products: Compelling products (or services) create success. To the extent you create great products, that people want to buy, you will achieve success. Creating compelling products comes back to the people. You need people who focus on getting the right products to the right market at the right time. Successful companies establish a product management/marketing role (or group), empower them with the ability to make decisions, and hold them accountable for their actions. This role is critical to the success of any company and according to Steve Johnson should have a seat at the executive table.
  • Profits: Without profits, nothing else (in your business) really matters. The efforts to hire the right people and create convincing products and services lead to profits.

Whether you are starting a new business or working to improve your current company, focusing on people, products and profits will lead you to success.


The Product Management Perspective: As a product manager, do you feel responsible for the success of your company? You no-doubt spend a lot of your time focusing on your products. You work with different people every day and have found some easier to work with than others. How much effort do you exert in building relationships of trust with the people on your team? These relationships are key to your success.

Of the three P’s listed above, the one that typically receives the least focus by product managers is profits (or perhaps more clearly stated, revenue). Too often we leave the worries and cares about money to the CFO’s office. We worry about getting requirements in place and making sure products releases meet their schedules, but we neglect the most important reason we create products…to gain profits.

Do revenue and profits factor in to your decisions as a product manager? How would your product requirements change if you focused more on profits? Please leave a comment and share your experiences.


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Technology: it’s all about the people

The first principle of the Five Factors of Leadership is that people are assets. Every organization, be it a technology company or a non-profit charitable organization, is composed of people. The people – not the buildings, equipment or intellectual property – compose the true assets of any company. Everything that exists in the world today, that might be considered an asset in the accounting sense of the word, was once the idea of one or more people who did the work to build the product and bring it to market.

A great example of this principle can be found in the history of Kingston Technology Corporation, founded by John Tu and David Sun. Kingston Technology took off as technology startup in 1987 (during a major stock market downturn no less). Rather than looking at their situation through the lens of scarcity, they looked for opportunities. They started a small company that produced nothing but memory for computers. To differentiate themselves from other companies (and allow a slightly higher profit margin) they:

  • Provided a five-year, no questions asked warranty (the industry standard was 90 days)
  • Focused on lifestyle for employees and their families
  • Paid the highest salaries for comparable positions
  • Paid 5% of pretax corporate profits directly to the 401(k) accounts of their employees
  • Guaranteed the employees that should the company ever go out of business, there was, in escrow, one year’s salary for every employee.

As a result, Kingston averaged less than 2% attrition, nearly unheard of in any organization. This meant that training costs were reduced, experience levels were high, and people performed to the very best of their abilities.

When the company was finally sold, Tu and Sun set aside $100M of the proceeds and divided it among the employees. The bonus was not as a traditional ‘pay grade relative’ bonus. Instead it was created and distributed based entirely on time with the company. The average payout to all employees, from highly trained engineers to assembly line workers, was $75,000.

As an organization, Kingston recognized the principle that people are the real assets. They understood, and subsequently proved, that it’s all about the people:

People who crave success
People who believe they can achieve
People who believe there is an abundance
People who recognize and appreciate other people.

Does your organization recognize the people as its most valuable asset?


The Product Management Perspective: I’ve stated before that – as the product manager – you have to be a leader (in the true sense of the word). You have the responsibility to get products out the door on time, with high quality and under budget. The kicker – and the reason you must be a leader – is the people you rely on to get the job done do not (usually) report you; they report to some other manger in the company. Your success depends on your ability to build consensus and inspire the team members to do great things. Remember the people (even that snarky engineer) are your true assets.


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It’s all about the people

The first principle of the Five Factors of Leadership is that people are assets. Every organization, be it a technology company or a non-profit charitable organization, is composed of people. The people – not the buildings, equipment or intellectual property – compose the true assets of any company. Everything that exists in the world today, that might be considered an asset in the accounting sense of the word, was once the idea of one or more people who did the work to bring it to market. Knowing this will help product managers (or anyone for that matter) understand the need to tune in to their teams and provide opportunities for their people.

A great example of this principle can be found in the history of Kingston Technology Corporation, founded by John Tu and David Sun. Kingston Technology took off as technology startup in 1987 (during a major stock market downturn). Rather than looking at their situation through the lens of scarcity, they looked for opportunities. They started a small company that produced nothing but memory for computers. To differentiate themselves from other companies (and allow a slightly higher profit margin) they:

  • Provided a five-year, no questions asked warranty (the industry standard was 90 days)
  • Focused on lifestyle for employees and their families
  • Paid the highest salaries for comparable positions
  • Paid 5% of pretax corporate profits directly to the 401(k) accounts of their employees
  • Guaranteed the employees that should the company ever go out of business, there was, in escrow, one year’s salary for every employee.

As a result, Kingston averaged less than 2% attrition, nearly unheard of in any organization. This meant that training costs were reduced, experience levels were high, and people performed to the very best of their abilities.

When the company was finally sold, Tu and Sun set aside $100M of the proceeds and divided it among the employees. The bonus was not as a traditional ‘pay grade relative’ bonus. Instead it was created and distributed based entirely on time with the company. The average payout to all employees, from highly trained engineers to assembly line workers, was $75,000.

As an organization, Kingston recognized the principle that people are the real assets. They understood, and subsequently proved, that it’s all about the people:

People who crave success
People who believe they can achieve
People who believe there is an abundance
People who recognize and appreciate other people.

Disclosure: Many thanks to my good friend Steve Reiser for his contribution to this post.