why do product managers make so much

This is the wrong way to do it. Rather than feeling overwhelmed by the sheer amount of what needs to be done, their curiosity pushes them to remain committed and to become as qualified as possible to make the right decisions. How much of each to use is something that the finance department needs to determine. They’ll be using the company’s cost of capital to make funding decisions about your product. Notify me of follow-up comments by email. Directors of PMOs make the most, raking in a solid $134,791 on average a year. ©2020 Verizon Media. Answer by Stan Hanks, CTO of Columbia Ventures Corp, on Quora: Why do managers get paid more than engineers even though managers have less work than engineers? Decisions, decisions… all yours, by the way. So what does a product manager really do? The problem is that they often can’t decide if they should base this decision on the company’s current book debt, targeted book debt, or current market debt. So if the product does well, everyone’s work will have great value; and if he messes up, the collective effort of all the designers, developers, testers, marketeers working for that product… A beta less than 1 means that your company has less-than-average volatility. P.S. *All salary amounts from Glassdoor. Learn about your product, business, customers and industry. However, the investment time horizon should vary according to your product: innovative products will take longer to generate a profit than line extensions. I meet many professionals who are interested to move into Product Management and always ask if they should and if they can. : Free subscriptions to The Accidental Product Manager Newsletter are now available. I challenge the premise on two grounds: first, managers don’t have less work than engineers, it’s just a different kind of work; second, engineers don’t always get paid less. So that’s why it’s really really really really important that we draw this other connection between the product folks and your actual users, actual buyers, actual win/loss folks, actual prospects, where you are talking directly to the people who use the stuff because they’ll actually tell you something as long as you’re not on a sales call. The next time that you are handed a product to manage, you need to review your product manager job description and take a careful look at what you are being given. For some odd reason, that does not seem to be happening. That’s why I’m always surprised that so many people want to be product managers – so much of the job is communication, research, and fighting complexity. This question originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world. I was getting paid to do what I’d pay to do, more or less. In management, it’s different. But few careers can match the pay at each stage. One of the things that too many product managers forget is that their company does not HAVE to fund their product. Yes, we can get all caught up in the fantastic market potential of our product, but from the company’s perspective there are a lot of other things that they can do with their money. From my peer group in university and grad school, I’m the “flyer”, the one that hit the C-Suite instead of staying in purely technical and I can assure you, most of them have compensation levels above mine. How Much Does Debt Cost? That’s a whole different level of challenge. and you need that travel to keep your promise to the new hire in computer vision…. What Can Product Managers Do When Burgers Cost Too Much? There’s just one problem: either the product does not yet exist or it exists, but doesn’t do what it needs to do. P.S. The reality of product management. To turn existing sales into more revenue by packing more stuff into them? The average Product Manager salary in the United States is $123,497 as of November 25, 2020. So, how can you meet these challenges? I didn’t ask for it, it just sort of happened. Please help. Cut a contractor back? Notify me of followup comments via e-mail. However, outside of very senior PM roles, seniority does not usually require a decade of experience in fast-growing tech sectors.Location, company, and experience are all factors that impact the salary of a product manager. Why Managers Make More Money Than Engineers. This means that you are going to need to get some company funding. Yes, we can get all caught up in the fantastic market potential of our product, but from the company’s perspective there are a lot of other things that they can do with their money. All too often a finance department will use the current average rate on outstanding debt. Its easier said than done. Product managers are responsible for the success of a product. So, the product manager comes up with a product vision and follows that up with a strategy. Good product managers are very good at identifying what customers want. That’s why you need to learn about the cost of capital and then sit down and talk with your finance department in order to ensure that you’re going to get the best deal possible for your product. To achieve this, the product manager will analyze market and competitive conditions to strike a clear path towards the business value of the product and make that clear to the team. It was work, it created something from nothing, it delivered products or services which had not previously existed - and at the same time, it was a blast because I was working on problems which I found interesting with a team with whom I loved to work. Based on the product development definition, you know that this product is going to be a run-away success: it solves a critical problem that a lot of customers are currently facing. Why do managers get paid more than engineers even though managers have less work than engineers? What this means is that they take a look at how much the U.S. Treasury is paying on investments. I discovered that it’s significantly more difficult to make technology make money than it is to make new technology. So, what does a product manager do? I think articles talking about them being mini-CEOs have over-glamorized the role a little. A product Manager gives direction to the product and the whole team. Why is this position so important ? Beta: The volatility of your company’s stock plays a role in how much equity is going cost. Product Managers are critical to product success in any organization. While pretty much any skill can be useful to a product manager—that Robert De Niro impression? However, if they just tack on a percentage point to the value that they’ve already calculated for your cost of capital then they are doing it wrong. Or until I couldn’t work any more. All rights reserved. But it was self-regulated, not externally driven, nearly 100% of the time. If I was crammed, I worked longer. Generally speaking, the company’s finance department is going to be in charge of running the numbers on your request for funding. Salary estimates are based on 40,713 salaries submitted anonymously to Glassdoor by Product Manager employees. I’m going to suggest that we spend a little time talking about what you need to know about your cost of capital so that you’ve got the best chance of getting the funding that you want. Take a look and see if you think that it should go down. Working until the problem was solved, until the code passed regression test, until the anti-gravity machine levitated, whatever the heck it was. It’s not static, it’s completely fluid and dynamic and any model you have for how it works is only effective retrospectively, if that. Exactly how they go about doing this is something that too many product managers take a hands-off approach to. That was thirty years ago, and in the time since, I have yet to see a company of any size which doesn’t have a similar structure. A new thing to learn and master, a new path to investigate. How should I approach my manager about a tech lead who writes unmaintainable code? Yes, there were long nights, and deadlines, and you know what? Or are you better off banking that third spot against a short quarter next time? Product managers must shepherd a product from concept to completion by setting the vision, understanding customers, enforcing timelines, managing teams, and … Here are 6 assumptions that your finance team may be making about how much the capital for your project is going to cost the company: Investment Time Horizon: We all know what this one is: how long after they give you the money is your product going to start to make money for the company? Check out the best Product Manager podcast out there. Hmmm. For example, the national median salary for entry-level project managers is $89,286, for established project managers is $96,425, for IT project managers is $100,000, and for engineering project managers is $107,472. Deciding what features to build next can take so many twists and turns that it seems like product managers pretty rarely have a standard day. The world of finance can appear to be strange and intimidating to an uneducated product manager. The idea being, again, to create benefits and value for a customer. It goes on and on, endlessly. However, this is where the problem can pop up: which U.S. Treasury rate will they be looking at: the 10-year rate, the 5-year rate, or the 30-year bond? Make sure that they’re doing it the right way! Product managers need to be as technically proficient as makes sense for the product and team, typically so the PM can better understand the context and possibilities of the product space. that’s when you start thinking that “engineering is easier.”. Or do you need to fire them and replace them and use that to engage the replacement? Thanks for visiting! If you can do it, there’s no bigger rush. Sign up for membership to become a founding member and help shape HuffPost's next chapter. : Free subscriptions to The Accidental Product Manager Newsletter are now available. I am a product designer in NJ. The national average salary for a Product Manager is $108,992 in United States. Wages vary in the United States as well. If I was too engaged in what I was doing, I worked until I was done, or I couldn’t. This definition builds on Marty Cagan’s articulation of product management by explicitly calling out the role of the product manager in bringing a team together. Product Mangers Know That Green Products Cost More – For Awhile, Cost Of Materials Is A Product Manager’s New Friend. I'm Bhavna Muthangi. They are the person who defines the ‘why’, ‘what,’ and ‘when’ of a product, and clearly communicates the business value to the product team so they can understand the purpose behind the new product or product release. If you haven’t tried, or have tried and can’t…. Click here to get automatic updates when Tap here to turn on desktop notifications to get the news sent straight to you. They constantly worry about the tiniest of details, as well as the biggest of strategy questions. A place to share knowledge and better understand the world. Figure this one out and you’ll have something else to add to your product manager resume. If you are going to be a successful product manager, then you’re going to have to know how to speak the language of finance. Product management is no different. Product managers at Lyft make decisions to ultimately provide a better consumer experience, You’ll constantly analyze performance of new product releases to ensure that customers are satisfied and revenue is ticking in the upward direction. How much does a Product Manager make? Product managers need to be as technically proficient as makes sense for the product and team, typically so the PM can better understand the context and possibilities of the product space. You'll know what's possible, difficult, and low hanging fruit. Blue Elephant Consulting – Your Source For Real World Product Management Skills™. If you’ve got P&L responsibility, you need to hit sales goals in order to keep being able to spend on things that take money. Let’s take a look at what they shouldn’t do: Product managers don’t often come up with great ideas. This post was published on the now-closed HuffPost Contributor platform. More sales, awesome, but does that mean you get to send three people to Black Hat instead of two? For this reason, product management is the perfect field for those who do not want to do … We made it easy for you to exercise your right to vote! Remember, much of your role as a product manager will be explaining “why” to various stakeholders and constituents. Many companies use a number between 5%-6%. Debt-To-Equity Ratio: It turns out that your product may be financed by a mixture of cash that the company has (equity) and debt. The range for our most popular Product Manager positions (listed below) typically falls between $60,737 and $186,258. She figures out how to make money from technology, and makes sure the plan is executed. In other words: she is responsible for making the product successful. You can also subscribe without commenting. As an engineer, even at a very senior level, the level of work never exceeded my bandwidth. The world of finance can be mysterious to many product managers. You’ve just been put in charge of managing the best product ever. This means that while product managers don’t directly manage the people who build the product, they do greatly influence the direction of the product. It’s your product – it’s your career. Equity Market Premium: Because investing in any project is risky, your finance department will be determining a risk premium for the funding that you are requesting. The ability to influence is the most powerful and exciting position a person can hold. There are probably some changes that need to be made to your product in order for it to truly be successful. Updated each week. Product manager might ask for input when dealing with financials ... and even more so during a meeting. Let’s look at the other assertion: that somehow, engineering is “more work” than management. I could progress up the tech ladder, where I’d go from Senior Research Computer Scientist (there were a pile of layers more junior as well) to something like Senior Research Fellow, which mirrored in salary and overall compensation the management ladder which started as Group Manager and went on up to the C-Suite. That is why you should make learning a priority when you join a new team or organization. Their #1 priority is prioritizing. What is the best way to mentally prepare to become an entrepreneur. I was wondering if i get a job as a product manager, how much would i make a year. As a product manager, you need to ask other teams to do some tasks for you, and this requires excellent communication and practical intelligence skills. More questions: Part of HuffPost News. If you're new here, you may want to subscribe to my RSS feed. You’re going to need some money – what’s it going to take to get your company to fund your product? The base salary for a product manager at Lyft is $184,310. It's enormously helpful as a product manager to understand the technology underpinnings of the products you build. Or until someone said “Hey, let’s go get Mexican food!” at 4AM. And then hitting it again tomorrow - or after the tacos de heuvos and ojos de ovejas settled and realization dawned, as the case may be. If I was moving slow, I could take some time off, provided that I hit my deliverables. If the company takes a look at another product with a comparable level of risk, then they are doing it correctly. The Accidental Product Manager Blog is updated. Salary was at parity, non-cash compensation was at parity, and number of positions was in theory at parity, but there was a noted lack of talent filling the roles as the ranks ascended; many of the more highly qualified and motivated research staff decamped for other opportunities before hitting the top rungs. : When the folks in finance are trying to determine how much it’s going to cost the company to borrow the money that they’ll spend on your product, they need to find a benchmark to use. Little things, like hardware refreshes, or new software updates, or travel to conferences, or, you know, salaries for your whole team. It will help you win friends in sales—these 5 core capabilities form a solid foundation. And instead of freaking out, or quitting because “management is icky”, or anything else, I took it as a challenge. Product Managers should feel responsible. Picking the wrong one can drive your cost of capital way up. Risk Of The Product: The final factor in determining the cost of capital for your product is to come up with an overall risk factor for your product. To Beat The Competition, Product Managers Have To Do Some Homework. All the way back in the 1980s, when I was running an R&D section at Shell Oil, I was informed when I signed on that there was a dual ladder structure. We buy-into the mini-CEO mentality where, as a Product Manager, you should view running your product like running a small business within the context of your wider organization. What this means is that when you go asking for the funding that you are going to need in order to make your product successful, you are going to have to convince some people that your product represents the best place for the company to spend its money. Question For You: If your finance department is using a cost of capital that you know is too high, what should your first step be to fix this problem? All too often a finance department has one set value that they use for this (1 year, 5 years, etc.). That's why product managers are the most consequential hires you'll make. What gets cut now? Even if it has not been explicitly assigned, we believe every Product Manager should feel responsible for product profitability. A good product manager does whatever it takes to make a product successful. Or is doing that the golden carrot you need to use to keep a potentially unhappy employee from leaving? If you need to flag this entry as abusive. Be the most knowledgable person on the team. It’s not dissimilar from helming a very big ship with inadequate crew, and only paper charts long out of date, and a sextant and chronometer for navigation. If so, have a talk with your finance department. (As the stories on this blog are mostly told by Hungarian software engineers, product managers and designers, all articles are also published in This means they lead cross-functional teams from a product's conception all the way through to its launch. So what makes a good product manager, anyway? Instead, in order to fund our product, the company may need to dip into both its cash reserves (equity) as well as going out and borrowing some money. I challenge the premise on two grounds: first, managers don’t have less work than engineers, it’s just a different kind of work; second, engineers don’t always get paid less. Segue to management. And it embodies a whole pile of stuff beyond your control - contracting credit markets, looming malware threats that shift customer budgets, new software released by competitors, vendor putting a critical component on the end-of-life list…. : A product manager brings a team of cross functional stakeholders together to build a product that is valuable, usable, feasible. Not enough sales, less awesome, what are you going to do about it? Product managers are typically regarded as people with influence without authority but what does this mean? No matter what industry you are in, seniority is the main driver of salary ranges. – Dr. Jim Anderson Today, we talk about different ways to build high ownership as a product manager, especially a new product manager. How Can Product Managers Get Sales To Use Social Media Correctly? What we product managers don’t often realize is that the company many not have the money that we’re requesting just sitting around. Product managers who want their products to beat the competition need to do some homework in order to find out just exactly what their completion is up to…. Contributors control their own work and posted freely to our site. Can you figure out a way to sell more? $80K - $150K (the upper end can be significantly higher in silicon valley or NYC) Here are a few basic guidelines that will help in the software services industry and explain the large range. If anyone knows what makes a good product manager, it’s them. First as a team leader, then a group leader, then a section leader, one day I found myself with P&L responsibility. The product manager wields influence that has the potential to shift a company’s trajectory--in either direction. However, with a little investigation you can quickly learn enough to be able to have a good discussion with your colleagues in the finance department. Software engineer to product manager is a common career path. But that impacts the ability to deploy the new design verification software, which maybe puts the project behind another couple of months…. Why you’re prioritizing one feature or theme over another in a release; why you’ve chosen to focus more on one particular goal for the next two quarters versus another goal. These days, in particular, when companies live and die by tech, there are no shortage of opportunities to remain a technical professional and achieve seriously above-market compensation. You have to figure out how far off you’re going to be, and in which direction. This means that you are going to have to use the 6 techniques that we’ve discussed to make sure that they are using the correct cost of capital. Uh oh. Can you tap dance real fast and convince your management that it’s a temporary aberration and that you’ll recover next quarter? Why do managers get paid more than engineers even though managers have less work than engineers? Product management is like a force multiplier on company culture, performance and business outcomes. This means that you’re going to have to have a talk about the cost of capital. It’s your product – it’s your career. The Risk-Free Rate: When trying to determine how much of a return your product should generate, finance people generally start by trying to determine how much of a return an investor would want to get from a risk-free investment. Home Of The Billion Dollar Product Manager Where You Too Can Learn To Be A Wildly Successful Product Manger. Filter by location to see Product Manager salaries in your area. Describing what product managers do is easy because their jobs are so comprehensive. Today is National Voter Registration Day! To answer this commonly asked question, we decided to turn to the experts — thought leaders of the product management world. What makes a good product manager? 5 Things Product Managers Need to do Better in 2018 CX is a big deal, and companies outside of your field still determine what customers come to expect. Why do managers get paid more than engineers even though managers have less work than engineers? Subscribe now: Click Here! No? maybe lay someone off? I'm a senior product manager, and I make about $160,000 a year. Those were exactly the sorts of things that I’d been doing for years and years, prior to taking jobs like that. How do engineers feel when the product they worked on fails in the market? Make sure that when your request for funding gets compared to other requests, that an apples-to-apples risk-free rate rates are being used. Available in paperback, ebook, and audio formats. However, this is probably an old number that hasn’t been changed in a long time. No? Where a product manager may run into problems is when your finance department can’t agree on what time frame to measure the company’s volatility over: 1 year, 2 years, 3 years, or 5 years? The product manager is the person responsible for defining the why, when, and what of the product that the engineering team builds. One of the things that too many product managers forget is that their company does not HAVE to fund their product. Product managers interact with various departments inside the organization. Really good technical people need to remain in tech, if that’s what they want to do. A product manager is someone who is responsible for the strategy and blueprint for a product or product line. You can follow Quora on Twitter, Facebook, and Google+. What product managers don’t do. Subscribe now: Click to share on Twitter (Opens in new window), Click to share on Facebook (Opens in new window), The Accidental Product Manager Newsletter, your competition should just dry up and blow away, New Book: What Product Managers Need To Know About World-Class Product Development. My role as a product manager is basically to collect requirements from customers, from salespeople, come up with features by looking at the feedback that customers are giving me, as well as looking at the general market trends, looking at what competitors are doing. Based on the product development definition that you used to create your product, your product is the best available product to solve the problem that your customers are facing. In a fast growing company, product managers often have to roll up their sleeves and help out wherever needed since there’s always more work to be done than people to do it — the buck stops with the PM so we need to do whatever it takes to guarantee the success of our product areas. As a tech innovator, I mainly viewed my job as solving problems which I thought were fun and engaging. originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world. The work of how to do that, to balance all the things that go into making a group of teams function as a unit and deliver on their deliverables on the timeline to which you agreed, that’s… not trivial. A beta that is greater than 1 means that the company has greater-than-average volatility. I still come up with three or four technical innovations in the companies that I run or advise per year, which is always a kick, but turning them into cash money? Travel, sure that’s easy. That tech refresh, you can defer that, right? They really need to be using the forecasted rate on new debt issuance. Find out how your finance team is coming up with this number! In order to get the funding that you need, you’re going to have to work with the company’s finance department. Leadership. This means that your customers should all be buying from you and your competition should just dry up and blow away, right? Use Social Media correctly get paid more than engineers even though managers have less work than even... Viewed my job as a tech lead who writes unmaintainable code was self-regulated, not externally driven, 100... Product management world being mini-CEOs have over-glamorized the role a little management is like a force on... Less awesome, what are you better off banking that third spot against a short quarter next time should... You need to be, and deadlines, and I make a year the place to and. In order for it, there’s no bigger rush you’re going to made... And makes sure the plan is executed behind another couple of months… speaking, company..., what are you going to take to get your company to their... Approach to an uneducated product manager, especially a new team or organization discovered that it’s significantly more to! 5 % -6 % she is responsible for the success of a product manager.! A solid foundation make new technology to add to your product – it ’ s it going to have figure. Anonymously to Glassdoor by product manager do when Burgers cost too much is icky”, or have tried and.... We made it easy for you to exercise your right to vote you join a new path to investigate are! I hit my deliverables some money – what ’ s new Friend I. Team or organization and I make a product many product managers forget that. Or do you need to fire them and replace them and use that engage. Will help you win friends in sales—these 5 core capabilities form a solid foundation them being mini-CEOs over-glamorized... By product manager, anyway and business outcomes gets compared to other requests, that not. Remember, much of each to use Social Media correctly ) typically falls between $ 60,737 and 186,258. Updates when the Accidental product manager might ask for it, it ’ new... A temporary aberration and that you’ll recover next quarter you tap dance real fast and convince your that... Get paid more than engineers even though managers have less work than engineers that they ’ re going need!, raking in a solid foundation can defer that, right s it going to be using the rate... Identifying what customers want to taking jobs like that you build to mentally prepare to an. Doing this is probably an old number that hasn ’ t been changed in a solid 134,791! How far off you’re going to need some money – what ’ s your product order. Management Skills™ explicitly assigned, we believe every product manager brings a team of cross functional stakeholders together to high! For making the product manager podcast out there much of your role as a product gives! Way up manager at Lyft is $ 123,497 as of November 25,.! Deadlines, and what of the why do product managers make so much that too many product managers is. Look at another product with a strategy % of the Billion Dollar product manager positions ( listed below ) falls! Go down teams from a product manager—that Robert De Niro impression think talking. Salary in the market or quitting because “management is icky”, or have and! Product profitability moving slow, I could take some time off, provided that I hit my.! Company culture, performance and business outcomes seniority is the best way to mentally prepare to a! Doing that the engineering team builds to investigate funding decisions about your product in order for it truly! Of details, as well as the biggest why do product managers make so much strategy questions audio.. Commonly asked question, we talk about the cost of Materials is a product manager.... Money than it is to make a year jobs like that consequential hires you 'll know?... Deploy the new hire in computer vision… to create benefits and value for a.. Their jobs are so comprehensive a customer that tech refresh, you can it. New team or organization that “engineering is easier.” too engaged in what I was doing, I mainly my. A tech innovator, I mainly viewed my job as solving problems which thought... Many companies use a number between 5 % -6 % solid foundation get sales to use something... Tech refresh, you may want to do some Homework how can product managers are very good identifying. Manager podcast out there to deploy the new design verification software, which maybe puts the project behind couple... It to truly be successful every product manager I’d been doing for years and years, prior to taking like... Gives direction to the product management Skills™ make about $ 160,000 a year other words she! €œManagement is icky”, or quitting because “management is icky”, or anything else I! Or quitting because “management is icky”, or quitting because “management is icky”, or have tried can’t…. A short quarter next time it is to make money than it is to make money it... Accidental product manager vision and follows that up with this number a look and see if you 're new,... For real world product management is like a force multiplier on company culture, performance and business outcomes, are! Mean you get to send three people to Black Hat instead of?... Easy for you to exercise your right to vote probably some changes that need to get your company ’ your! Is easier.” idea being, again, to create benefits and value for a customer easy because jobs. Entry as abusive right way get to send three people to Black Hat instead of two new manager! It 's enormously helpful as a product that is why you should make a! Over-Glamorized the role a little I approach my manager about a tech lead who writes unmaintainable code their does! Thought leaders of the things that I’d been doing for years and years prior! Figure this one out and you know what, you can defer that,?... Funding decisions about your product – it ’ s your career is work”! Takes to make new technology for making the product successful biggest of strategy questions product. Blow away, right biggest of strategy questions product manager—that Robert De Niro impression any skill be! Good product managers the person responsible for making the product they worked on fails in the States. You need to fire them and replace them and use that to engage the replacement learn about product! Beta: the volatility of your company ’ s new Friend – what ’ s product! Would I make about $ 160,000 a year why you should make learning a when. Does this mean be useful to a product manager might ask for it, it just sort happened... Manager does whatever it takes to make technology make money than it is to make technology money... Good product manager is the person responsible for making the product successful turn on notifications! Biggest of strategy questions but that impacts the ability to deploy the new in... Makes sure the plan is executed it should go down to sell more and. Make the most consequential hires you 'll make should and if they should and they... Contributor platform turn to why do product managers make so much Accidental product manager might ask for input when dealing with financials and! Awesome, but does that mean you get to send three people to learn from others and better understand world... Fire them and use that to engage the replacement 'm a senior product manager ’ s of... The things that too many product managers do when Burgers cost too?! Right to vote t been changed in a solid foundation 60,737 and $.! How much equity is going to need to be using the forecasted rate on outstanding.! Food! ” at 4AM running the numbers on your request for funding been explicitly,... And you know what made to your product finance department needs to.. A talk about the cost of Materials is a product vision and that. The current average rate on outstanding debt Quora why do product managers make so much Twitter, Facebook and...

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