Structuring B2C Product Teams Part 2

General Guidelines for How to Build and Structure any B2C Product Team

In the previous post, I discussed how to organize your product team based on the business type you have. This second post discusses how to organize your product team based on the type of structure you want to have for the company overall.

How to Organize Your Product Team

So now you've identified your business type and metrics, how do you actually organize the team? Here are a couple ideas:

Product as it's own organization

It's quite common for the product organization to stand on its own. The Head of Product’s (or VP Product or CPO depending on the size of the organization) role is to set overall vision, strategy, and key metric and focus areas (and in smaller companies, also do the actual day to day work of product management).

As the organization grows, that product lead then identifies key areas where they need to scale up their team, either to focus on specific metrics or other key business areas. Each product manager should have a clear focus area and it's best if they don't overlap, especially early on.

Under this structure, technology, design, and data resources work closely with product, but they all work for separate organizations. Oftentimes, the end result of this is a matrixed organization, where a PM needs to get very good at managing by influence.

At many early organizations where the CEO/founder is also the product visionary, there may not be a need initially for a head of product. as many of those responsibilities may fall to the CEO.

Generally, I try to make my product organization have a balance between innovation and growth as mentioned in previous posts. It's critical when you are organizing your product team that when you identify your business model, you also setup each product manager or product team with a clear set of goals and a balance for how much of their time should be split between innovation and growth.

What Functions Report to Product

As I stated before, it’s pretty common for product to live as its own team, usually with a leader reporting directly into the CEO. This is the approach I prefer, especially for software companies where product strategy is a key element to the success of the business. I’m less thrilled when the product leader reports into a CTO or COO because it usually devalues the product leader and it makes it harder for them to have influence. Most great B2C products have a strong product organization, and it’s critical to foster that structure to create the right focus for your organization.

It’s becoming increasingly common for multiple parts of the organization to report into product. I have mixed feelings about this, despite the fact that I’ve had multiple various organizations reporting into me. Personally, in my years as a product leader, I’ve also managed growth, design, QA, customer care, and content teams.

I think this can work, but generally you need to have strong line leaders to help run those teams to prevent you from getting overwhelmed and preventing you from doing the job of a product leader. In a structure like this, you can take on more of a general management role, which can make it challenging to be the key visionary for product at the company.

In other organizations, it’s important to identify the functions that need to have direct line responsibility to the CEO. Design is a great example - in certain companies, it will be ok for design to be part of the product organization if you are building a well-established product or you can follow common patterns. But in an organization that has strong design vision and leadership, it’s key to counter-balance the product leader with a design leader to create the best possible product.

Product Structured as a Growth Organization

A newer trend is the growth organization, where multiple functions roll up to a General Manager or Product Lead.

The head of growth creates growth teams that focus on key parts of the business, with each product person responsible for a specific area with the resources they need reporting into them: marketing, design, engineering, QA (if required), analyst, and anything else needed.

This team is singularly focused on a general area or metric and the role of the team is to constantly monitor, move, and improve this metric over time. Lots of companies are increasingly moving to this structure for the flexibility and focus that it provides on specific metrics and growth areas. I like this structure, but it requires top notch talent as the team lead or product manager (not junior or unknowledgeable product people or leaders to run the team).

This structure has the added benefit of forcing everyone to be aligned on the goals and metrics for the area. That’s why it requires a strong leader in the role - that person (normally the PM) must be the unifying force for the team to understand the goals of the team, what metrics are important for the team, the organizational structure of the team, and how those metrics are going to be moved.

However, I think it's hard to have all of product structured as growth. Keep in mind that the growth structure is usually well-optimized to focus on particular metrics or growth areas. However, when it comes to innovation or big changes to the product, talking to users, getting deep insights, growth organizations are not always the best suited for this type of work. Therefore, I recommend that long term, you will need to make sure you can balance the amount of your team focused on growth vs how much is focused on future innovation.

Here are some other interesting reads on the same topic:

http://pragmaticmarketing.com/resources/5-steps-to-building-a-great-product-management-organization

https://captaintrouble.files.wordpress.com/2013/03/product-management-organization-structure-patterns-v1-02.pdf