Product management · Product Development

Why aren’t more product managers CEOs?

Nate Holbrook Founder / CEO at Lilac

June 20th, 2015

Great product managers must be the “CEO” of their product. If that’s the case, why don’t more CEOs come from product management positions/backgrounds? 

Alex Eckelberry CEO at Meros.io

June 20th, 2015

It's a very good point. I was a former PM and became a CEO. However, I find it very rare. 

I think a big reason is that investors love sales guys because they're big, bold and make lots of promises. So a lot of sales guys become CEOs. I'm not saying that's bad or good, it just happens to be observable. 

Doug Barre Co-Owner/Partner GeeksForLess

June 20th, 2015

Very good point Nate....probably because most boards incorrectly view sales and finance more important.

In a product company the most critical position is product management. Get that right and your probability of success is increased 10 fold.

The best CEO I know is the best product manager I ever worked with 20 ears ago. So it does happen but not enough.

Doug

Peter Johnston Businesses are composed of pixels, bytes & atoms. All 3 change constantly. I make that change +ve.

June 22nd, 2015

The C- Suite is a 20th century idea. And Product is a nineteenth century one. Both should not be relevant to a modern business and both CEO and Product Manager thinking should be consigned to history.

The key change was made by Napoleon. He structured his Grand Armee so each unit could operate independently, acting as flank, vanguard or rearguard at will and making decisions on the fly, without reference to the overall leader. It was phenomenally successful, defeating armies many times his force's size and when he was eventually defeated by the combined might of the aristocracies of Europe they adopted his methodology.

It moved to the next stage after 7 million deaths in WW1 showed the folly of centralised control with small teams of experts banded together in units with each member deferring to the expertise of the expert in that part, yet working together collectively. Today these small, flexible units which make fast decisions are essential to combat guerrilla tactics by terrorists using similar organisational systems.

Industry, however, went happily on with the egotistical hierarchical model and it was given added impetus with the first generation of software which created deep silos based around each group's version of the truth. The effect was to create large ineffective organisations - the exact opposite of the intent to share information to be more agile.

In modern companies a new method is taking over - these same small units. Here roles are flexible - if one person has a flair for organisation, another for vision and a third for communication, they can split out responsibilities to suit. The leader is just as likely to be a technical person as a people manager and roles may even switch according to task, project or outcome.

Product focus is a hangover from the industrial age, where automation in factories created a physical product in quantity and undifferentiated across all markets. It was naively believed that the best product would always win and a product manager was the champion of the process to win this feature race. Often the race was to the bottom as with long production runs every cent saved put millions on the bottom line of the company.

Now product is only one of the 4Ps of People, Process, Profit and Product which together make up the creation of a "product" and product-market fit allies it to the markets it serves. In this environment a product manager is a dangerous silo - innovations in other areas are just as likely to give the company the edge.

Consign CEO to the bin. And Product Manager.

Then think again around teams - fluid to suit the skills involved and which start with the market, working back together to what you need to offer. And keep it fluid - people change, whether customers or employees.

Bharathi Masilamani Software Development Manager at Amazon

June 21st, 2015

+1 
Assuming all of us talking about tech companies - I too strongly believe that strong Product Manager make great CEOs.

Stan Podolski CEO at Nimble Aircraft.

June 21st, 2015

I believe the answer is quite simple.

To build a company you need a
1. product
2. sales

To have a product you would need a developer (if we are talking about IT product), and to have sales you need a sales person. The great PM would really contribute... later. In the beginning you just need these two roles. So I am in fact a PM, but I have learned how to code to make my dream true

Adam Owens

June 23rd, 2015

Excellent discussion!  Generational gap.  Senior investors and board members don't fully understand today's importance of innovation and engineer recruiting.  The next generation of CEOs, especially in the tech arena, will need to command competence and respect from both the engineering and business aspects of the company.  Engineering really is the life blood of tech companies and you need a someone in charge that can recruit and inspire engineers.  Without good engineers to continue innovating, your tech company will be a fad.  

Anonymous

June 20th, 2015

A CEO needs to do three things:
 - raise the money/handle the shareholders
 - be the company's chief evangelist
 - be the face of the marketing effort

If the product manager cannot do this, he/she should not be CEO.

Mark Travis Product Management Advisor | Speaker | Strategist

June 22nd, 2015

Peter, that is a refreshing perspective! I'm going to file that body of knowledge for further pondering. 

My thoughts on this subject are that it depends on your market, and it depends on the size of your organization.

If you are a small, long-tailed, niche provider of product/services, you are going to be served well by a product management mindset. This is especially true for a technology startup where you are essentially transforming a custom, consulting based product into a repeatable, feature-based product. Just about any technology startup founder could be considered a product manager of one very important product. 

If you are in a commodity type business, you need less of a product-focused mindset, and more of a marketing/sales and finance mindset. This even applies to technology companies that are competing in a commoditized niche. Think of industries like computer servers/hosting and food service companies. 

Then there is the size and composition of the business. If it's a collection of similar products in a smaller company, a product manager might be the best fit. If you have a business that is composed of several collections of products, then a marketing and finance mindset might be better. 

I think when you get to the Fortune 500 stage, Peter's thoughts are brilliant. 

Lorraine Wheeler President at Redstoke, LLC

June 20th, 2015

I agree with Alex.  A startup CEO who needs to raise money is often from a sales background.  In effect, they are selling the company to investors.  Often, if a startup is raising money, product management falls to someone else because raising money is a full time job.  Product managers also get a lot of satisfaction from creating a successful product as opposed to raising money.

I think it is far more common to see a former product manager as a CEO of a bootstrapped company.  

Marc Rowen

June 20th, 2015

Haven't seen research on this, so it's just based on observation and speculation. I think there may be a few reasons.

1. There is a smaller number of PMs compared to other disciplines. Part of what makes a great PM great is the ability to support a large set of constituents.

2. Most PMs don't start their careers as PMs. I would guess a relatively high percentage of people who become CEOs might otherwise become PMs, especially founder CEOs. Moreso perhaps than other career transitions.

3. I agree great PMs are CEOs of their product, but with emphasis on product. A founding CEO also focuses a lot on product in a lot of cases, but as a company becomes more successful, the CEO must focus on other areas. That might not be appealing to a great PM.