Product Management Reporting Lines Called Into Question

When he first read through the findings from the State of Product Leadership survey, Pendo’s chief product officer Brian Crofts slacked me a jab that was both hilarious and telling.

“Was this State of Product Leadership thing some sort of elaborate ploy to get my team reporting to you?”

Of course I knew exactly what he was talking about. A couple weeks ago, Pendo announced the key findings from our first annual State of Product Leadership survey (henceforth known as SOPL–as in soap-uhl). One of the more surprising findings was the unexpected fact that, more than any other function, product management reports into marketing.

And the product managers that report into marketing tell us they have broader responsibilities, more empowerment, judge themselves as more effective in their roles, and tend to be happier.

I say this is an unexpected finding, but truthfully it wasn’t all that surprising to me. In my career, as a marketing leader and CMO, I’ve often had product management reporting into my organization. To me, this was always favorable to the classic engineering alternative. Why?

Three primary reasons:

1. Customer insight–more than any other function, marketing owns the voice of the customer. Through its focus on market research, competitive intelligence, positioning, messaging, and efforts to understand what moves people to action, marketing has a unique proximity to customer motivations and goals that often leads to better products.
2. Go to market coordination–great products fail all the time when spectacular engineering feats meet mediocre sales and marketing execution. Close alignment to the market-facing functions of the business improves the odds of great products that also yield great business outcomes.
3. Creative tension–when engineering owns the product management function there’s no obvious counterbalance, no catalyst (or irritant!) to force the often difficult conversations that help to upend traditionally held beliefs in the service of better product decisions.

At this point, perhaps you’re thinking that Brian was right–that I’m trying to make the case for a land grab. In fact, that couldn’t be further from the case! While I maintain that the marketing reporting lines are much better than the engineering alternative, this organizational structure has outlived its usefulness. There’s a better alternative.

Today, the most progressive companies have dedicated product organizations that report into a chief product officer–like my colleague Brian–who in turn reports into the CEO. This ensures that product is equal among the most strategic concerns of the business.

“I believe strongly that the head of product should report into the CEO,” says Megan Quinn, a general partner at Spark Capital, early Google employee, and former head of product at Square.  “[But] I also believe strongly that the head of engineering should report into the CEO.”

Why? Balanced resource allocation and a healthy tension between these functions, she suggests. She sees the optimal organizational structure as what she describes as “a building engine” between product, design, and engineering engaging in a continuous dialogue around priorities. “I don’t consider it a negative signal when a company is constantly re-evaluating priorities and resources,” she says. “That’s part of building a fast-growing company.”

As I wrote last week, product is the new marketing: your customers have abundant alternatives and products that fail to delight are quickly discovered and stamped out through something like a virulent, accelerated form of natural selection. The reality is that products that are good enough are no longer good enough. The best products become the category leaders, which are are the ones that take home a vastly disproportionate share of the winnings. Products that are second best fare substantially worse–and all the rest tend to fade into obscurity.

Reporting lines are a question we talk a lot about in product management. Opinions tend to be sharply divided, positions passionately defended. What do you think?

Go ahead and vote now. The poll closes on Thursday.