Product Owner vs. Product Manager: A Brief History and the Differences

Product Owner vs. Product Manager

This is a common question within the product space, especially considering the overlap of the roles. Product owner and product manager are intertwined and can mirror each other, and, at times, the terms are used interchangeably. 

We are going to focus on the agile/scrum definition of the term for the sake of simplicity and we can break them down as follows: 

  • A product manager is strategic. As in, they focus on the product’s vision, the objectives of the company, and the overall market. 
  • A product owner is more tactically focused. They take the product manager’s strategy and break it down into actionable tasks while working with cross functional agile teams to make sure they are adequately completing the necessary tasks. 

To truly understand how we got to this separation, it’s important to take a look back in time. 

A Brief History of Product Management

Modern product management started in 1931 with a memo written by Neil H. McElroy, who eventually was the Secretary of Defense and helped found NASA, at Procter & Gamble as a justification to hire more people. 

His 800 word memo basically described “brand men” and their responsibility for a brand, which included tracking sales to managing the product, advertising, and promotions, which all needed to be done through field testing and client interaction. 

McElroy’s influence extended to Bill Hewlett and David Packard who interpreted the “brand men” memo as needing to put decision making as close as possible to the customer, essentially making the product manager the voice of the customer. 

On top of this, Hewlett and Packard introduced division structure, where each product group became a self-sustaining organization (of no more than 500 people where it is then split further to keep it small) responsible for developing, marketing, and manufacturing its products. 

Meanwhile, at the same time in post-war Japan, shortages and cashflow issues made industries create just-in-time manufacturing. This lead to the creation of Toyota and the Toyota production system where the focus is not just on eliminating waste in production, but two other important pillars:

  • Kaizen Improving the business continuously while always driving for innovation and evolution
  • Genchi Genbutsu to go to the source to find the facts to make correct decisions 

Hewlett and Packard quickly adopted this line of thinking of customer centric, brand vertical, and lean manufacturing, which seeped its way into Silicon Valley. 

Before entering the tech space, Product Management was largely a marketing communications role, focusing on getting the right mix of packaging, pricing, promotions, and brand marketing while development was left for others. 

As the tech world started blossoming, however, the roles started to blend into one where companies creating entirely new industries couldn’t rely exclusively on packaging and pricing of a commodity to succeed. This need brought product development back into the product management role. 

Nowadays, Marketing has evolved to be about owning the brand and customer acquisition, whilst product managers owns the value proposition and development of the product. 

Up until 2001, companies relied on the waterfall process for product building, which was time consuming and laborious. 

What happened in 2001? 

The Agile Manifesto was born in a ski resort from the work of 17 software engineers looking to trim down the development process. 

This isn’t to say other methods like Scrum, DSDM, XP, and Kanban didn’t exist, they did, but the Agile Manifesto laid out a few key points: 

“We are uncovering better ways of developing software by doing it and helping others do it. Through this work we have come to value:
Individuals and interactions over Processes and tools
Working software over Comprehensive documentation
Customer collaboration over Contract negotiation
Responding to change over Following a plan
That is, while there is value in the items on the right, we value the items on the left more.”

This was a massive change in product management as it shifted the relationship from a churn and burn development method to a collaborative customer centric approach.

Moreover, it changed the relationship of product management and engineering from a combative one to a collaborative one. 

On top of this, it moved the user experience aspect of the development process from the backburner to the forefront of development. 

And for the sake of this article, the role of Product Owner bubbled up from the manifesto creating a communication channel and connection between product management and engineering to figure out the best solution to customer problems. 

What Is a Product Owner? 

The Product Owner mainly exists in the agile methodology  and can be understood as a more tactical role. 

Essentially, they work closely with delivery teams to ensure they build the right functionality in a timely manner. 

Some baseline activities for a Product Owner are attending team alignment meetings, organizing demos, doing sufficient analysis to ensure requirements are ready to be worked on, and being continuously involved with ongoing testing efforts. 

To be more specific about it, the product owner can do things such as: 

  • Turning customer pains and problems into user stories that are actionable while simultaneously prioritizing them and arranging them accordingly in the product backlog
  • Aligns production processes to ensure the development team has a clear understanding on what to focus on
  • Communicated the voice of the customer to the development team 
  • Attends all agile and scrum meetings to make sure everyone is aligned with the roadmap set by the product manager, providing necessary feedback to the product manager accordingly 

Then What Is a Product Manager? 

A Product Manager can be simply understood as an individual that discovers what users need, prioritizes what to build next, and rallies the team around a product roadmap. 

To break it down further, product management is the practice of strategically driving the development, market launch, and continual support and improvement of a company’s products. They tend to focus on the long-term strategy, the product vision, the market trends, and the identification of new opportunities. 

Some specific tasks a product manager can do are: 

  • Discovering what users need by conducting user research
  • Create the long term vision and strategy for a product
  • Align the team behind a cohesive roadmap
  • Deliver features that delight the customers
  • Champion the stakeholders to ensure alignment around overall strategy and direction of the product

Can the Product Manager Be the Product Owner? 

Everything is dependent on the size of your company and the breadth of your product. 

A product manager absolutely can also be a product owner. 

Conversely, a product owner absolutely can be a product manager. 

It just depends on how big your product is. If you are a small team and a new product, more often than not, you will have a product manager simultaneously acting as a product owner. 

The separation comes in when there are multiple facets of a product to start working on and you need the division of responsibilities and labor to not overwhelm a single product manager. This is where the product owner role would come into play.

So Who Is More Valuable to the Organization: A Product Owner or a Product Manager? 

Both hold significant value. 

The product manager outlines the vision and roadmap, whilst the product owner is tasked with executing on it. 

The coolest part about the product world is that most people within it are multifaceted so this question won’t be one that ought to come up. 

If you have a product manager, chances are they’ve been a product owner at some point through their career and could jump in the driver’s seat. The same applies inversely. 

If your organization is small, a hybrid role might be the most beneficial. 

Usually, you’ll know when you need a product owner when you need a product owner. 

So the answer can be understood as a product manager is the more important position until it gets to the point where a product owner is necessary, then they are equally valuable. 

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