Internal product managers come up against obstacles and face dilemmas that are often unique.
In industries like banking, we’ve seen first-hand how they face difficulties in almost every aspect of their role. These include handling complex internal structures, dealing with conflicting internal customer demands, managing day-to-day delivery and demonstrating the effectiveness of their work.
If you’re an internal product manager finding it hard to succeed we’ve outlined six ways to become more empowered in your job…
1. Be clear on the mandate and scope of your role
The role of internal product management can vary from company to company but often it’s about being a center of expertise on an internal IT capability. Internal customers come to get advice on what the best option is for them, to ask if they can have something new developed or how to resolve problems. The business benefit is the cost savings of doing things right, once and consistently across the company.
What you can do: Make sure you have a slide or elevator pitch ready that summarises why internal product management exists in your business. And, be clear on what the boundaries of your role are when working with internal customers. The Product Activities Framework is a useful tool to help the discussion on role boundaries – you can download a free copy from here.
2. Have a clear business case
Writing a clear business case is vital to a product’s future success.
Business cases are normally accomplished by building an understanding of how much a company can make selling a new product to external customers. This is then compared to the costs of building and running it.
Internal products don’t have the same measurements for success or failure. When a department does not have to pay for it, team members can have a reduced sense of the product’s worth. This makes engaging with them to build a business case for the product difficult. Even if they are going to pay for it, it could be on a cost-plus model that can make commodity products look expensive, creating negative perceptions of what internal product management has delivered.
What you can do: Forge a good relationship with the beneficiaries and coach them on how to articulate these benefits.
Work with them to pinpoint how the new product will increase efficiency, bring cost savings, improve employee retention/attraction or boost revenue for the business. Outline the scale of these improvements in language that makes sense for senior stakeholders.
For example, imagine a product that will save 20 minutes per eight-hour day for each person in a support team (a saving of 4%). This could, arguably, save €40k a year on a team costing €1m a year. However, this argument is unlikely to be successful as there is no reduction in payroll as a result of an initiative like this.
Rather than concentrate on the monetary savings, outline what the support team will be able to do with their 4% time-saving. Perhaps they could give a better service that improves customer retention or improve their processes and efficiency. Quantify these valuable outcomes and put them into your business case.
3. Keep current
When internal customers are barred by company policy from buying externally, product managers can become overly focused on internal issues. They spend insufficient time looking outside the business.
We’ve seen teams that aren’t benchmarking against what’s happening in the commercial world. Their stakeholders may begin to compare them unfavorably with outside competition. It can become increasingly difficult to justify future investments. Development often slips further behind the competition and if this happens, end users start to devalue all products created by internal product teams.
What you can do: Create a product roadmap that incorporates benchmarking against the external competition and the expectations of your stakeholders.
By researching commercial products and your users’ needs, you protect yourself from being unduly influenced by internal discussions and expectations of technical feasibility.
Benchmarking against the competition is vitally important for product managers of internal products. It makes you aware of trends that inform your technical roadmap, user experience, processes, promotion, and pricing.
4. Monitor your performance to demonstrate value
Internal product managers may face challenges in reviewing product performance.
With commercial products, the benchmarks for success and failure are usually clear. Revenue, profit or number of customers could all be used. For some internal products, the metric can also be clear. For example, a product that replaces an expensive option with a cheaper alternative can have a simple metric around cost reduction.
But it’s not so simple for many internal products. The department that gains the benefit might not be prepared to measure improvements or may find them too difficult to track.
Knowing whether a product is hitting targets for adoption, understanding how happy customers are and how it is being used all provide important insights. With this information, we can decide whether the product was worth the time and effort it took to develop it. We can also discern how we can improve it. But we often meet internal product managers frustrated by a lack of information of this kind and even managers that haven’t set or been set targets.
What you can do: To get hold of these metrics, forge strong relationships with the teams using the product.
Work with them to find the best way of collecting the data you need. Set yourself the task of finding clear ways to measure your product’s performance.
Start with adoption rates, which should be forecast and measured. To build an understanding of the product’s performance we’d advise usage rates and Customer Satisfaction scores.
5. Become a dedicated marketer of your product
Internal products can suffer from an image problem. There is often little or no internal communication about products’ uses, features or benefits. Potential users don’t know about them or don’t understand what they can do. Products created to help departments, or even whole companies, are left underutilized.
Pricing can be another reason internal products get bad press. They can find themselves unfairly compared to ‘cheaper’ outside alternatives and see usage rates drop. Without the right communication, your product can be misunderstood.
What you can do: Think like an external marketer. Develop a marketing strategy to educate your users on your product’s systems and benefits.
Get to know your users and stakeholders – who they are, what they need to achieve and what tools they use. This knowledge will help you to create a great campaign that speaks to their needs and gives them solutions to their problems.
Write newsletters, blog sites or other marketing tools to target all potential users of internal products and services. Create materials that accurately outline how your product will benefit them.
6. Find creative ways to solve front line queries
Internal products often don’t have technical pre-sales and sales teams that sit between product management and the customer.
As a result, there may be little filtering of inquiries from users. The internal product manager may face a constant barrage of detailed questions about their product. We often meet managers who cite this as the main reason they’re unable to spend the time they’d like on market insight and other work.
What you can do: Create or sharpen up marketing and online resources. This will mean that stakeholders are more aware of the options and can find the information that’s relevant to them.
An effective starting point is to aim the information you produce towards different personas – such as different types of users, managers, and approvers. This will enable people to find what they want more quickly. It will also allow you to pinpoint and educate potential allies as you build your marketing push and populate your information hub.
Ensure support teams are adequately trained to answer simple questions about the product and funnel queries to them. Also, think about a ‘hit team’ of expert practitioners who visit sites to help market and address questions about internal products.
Enable users to help themselves and help each other. Build up easily accessible FAQs as you field queries. Run regular training sessions like webinars and then make them available online afterward. Establish and build an online community in which people can ask questions and other community members answer. Find champions in your user community that you can support with extra information and training and who can then handle queries from their colleagues. These local ‘experts’ can be wonderfully receptive, as they begin to enjoy the role.
Due to the nature of their job, internal product managers find themselves in a unique situation. Their challenge is serving internal customers rather than selling to external customers.
We’ve outlined a number of approaches that can help. Start with the way you define your role and build from there. Be creative in your business case writing, benchmark against the competition, carefully monitor your performance, actively market your product to internal teams and continually develop support material to succeed.
Do you face these challenges in your role? Let us know what you think in the comments below.
Director, Product Focus
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This is so helpful. I’m a new Internal Product Manager and its hard to find information on this segment of the discipline of product management.
This is one of the most insightful articles I have read about challenges of an internal PM. I strongly recommend every internal PM applying the learnings in their day to day work life
As an internal PM 1 year into the role, this article really pinpoints the struggle that I personally and most other internal PMs face. There should be more articles like this to educate new Internal PMs. I wonder is there a community built specifically for internal PMs?
I have just become an internal PM, did you have any luck finding a community for internal PMS?
Maybe we can start our own?
New data organization and new internal Product Managers implementing SAFe Agile practices for the first time in the company; we are blazing new trails and there are lots of folks watching our little org. With so little information and guidance out there for internal PMs articles like this are invaluable. Thank you for having this available. I hope to find more of this type coming soon.