Product Manager vs. Project Manager: When and For What?

I often get asked whether all Project Managers should now be retrained as Product Managers or be replaced by them. In my view, these roles are not actually competing. On the contrary, they are very different, each with its own time and place. Additionally, they work well together, especially in large companies. I’ve had the honour of working with Project Managers who enabled me and the entire product and development team to do our jobs better. I dare say we wouldn't have reached value from scratch as quickly with these products if I also had to manage the smooth running of work processes.

Since this has been a recurring topic lately, now is a good time, before the storm of new projects in the fall, to reflect on the main differences between a Product Manager and a Project Manager and what results can be expected under the leadership of each.

The Product Manager Role

The primary task of a Product Manager is to lead the vision and strategy of a product, focusing on customer needs and market demands. In simpler terms, a Product Manager must identify customer needs (which may differ in various markets) and, based on this information, develop software or other products that solve significant problems to help the company achieve business success.

The Product Manager, with the help of the product team, must then bring this product to market through iterative development. The Product Manager is responsible for managing the entire product lifecycle from idea creation to market launch and beyond. One of the most important responsibilities of a Product Manager is the profitability of the product in the market. By tracking this, it can be understood whether the product solves a significant problem and whether it is worthwhile to continue investing in it.

Key Responsibilities:

• Developing the product vision and strategy

• Analyzing customer needs and market trends

• Planning new features and improvements

• Increasing customer satisfaction and product value

• Ensuring the product’s profitability in the market

Success Metrics:

• Customer satisfaction and loyalty

• Increased market share and revenue

• Innovation and market disruption

The Project Manager Role

The main task of a Project Manager is to ensure that a project is completed within schedule and budget, managing resources and risks. A Project Manager focuses primarily on supporting the project team, ensuring that all stages of the project are carried out smoothly and efficiently.

Marty Cagan emphasizes that Project Managers are focused on short-term goals and fulfilling external demands, while Product Managers focus on long-term value creation and innovation.

Key Responsibilities:

• Planning the project and creating a schedule

• Managing resources and tasks

• Resolving risks and issues

• Completing the project according to plan

Success Metrics:

• Completing the project on time and within budget

• Smooth and efficient project execution

• Fewer realized risks

• Meeting project requirements and expectations

From Project Manager to Product Manager or Vice Versa?

I am often asked whether a Product Manager can fulfill the role of a Project Manager and vice versa. While it is possible in one direction, the learning curve is steeper in the other.

Product Manager as a Project Manager: Product Managers can successfully take on the role of a Project Manager, especially in smaller companies or startups where resources are limited. They are used to working strategically and often have a good understanding of project management since they need to coordinate various activities throughout the product lifecycle.

Pros:

• Strong strategic thinking

• Understanding of the market and customers

• Ability to lead the product development process from start to finish

Cons:

• Detailed focus on schedule and resources can sometimes take a backseat

Project Manager as a Product Manager: It may be more challenging for Project Managers to take on the role of a Product Manager, as product management requires specific skills focused on understanding market and customer needs and strategic product development. Project Managers often lack deep knowledge of marketing, customer-centric thinking, and innovation, which are necessary for creating and implementing a successful product vision.

I think it is also important to note that even if the Project Manager has some or all of the necessary skills to take on the responsibilities of a Product Manager, there is usually a business stakeholder responsible for the product management tasks already. Therefore the Project Manager may not have the necessary mandate for strategic decision-making.

Pros:

• Strong in managing schedules and budgets

• Essential for successfully completing product development

Cons:

• Lack of deep understanding of customers and the market

• Leading innovation can be challenging

Which is Better?

There isn't a straightforward answer to this. The question is about the company's business model and goals. After that, it can be discussed whether a Product Manager, Project Manager, or both are needed. The most important thing is that the company makes a clear decision on what is more important: whether the developed product is valuable to the end-user and the expectation is to achieve business success through this or whether it is more important that the project stays within time and resource frames.

Of course, I don't mean that endless resources should be put into a product until it becomes successful, but agile/iterative product development unfortunately requires a somewhat more flexible timeframe.

In a customer-centric company, if I had to choose, I could do without a Project Manager, but the tasks of a Product Manager cannot be replaced by other roles in product development.

Conclusion

A Product Manager focuses on the product vision and market needs, while a Project Manager focuses on the successful execution of the project. For the best results, especially in large companies, effective cooperation between these roles is necessary. Sometimes you can manage with just one, sometimes both are needed. The most important thing is to think through whether market needs or precise project execution are more important.