Giving general advice on a product management budget is kind of hard to do. Like any other big department or field in business, budgets are something that has to be coped with. We all must stand at attention when the taxman cometh, after all. However, there are a lot of distinct things to deal with in the field of product management, which can make general advice on this topic very hard to condense.
With product management budget, it depends on a number of things such as whether you’re B2B or B2C, ecommerce or brick and mortar, and whether it’s a product launch or a sustained cycle. So, you have your work cut out for you in getting a general grasp of budgets for this field, and I certainly have my work cut out for me in providing a solid piece that can handle all of this concisely.
Well, let’s give it a try, anyhow.
#1 – Balancing Research and Production
One of the bigger issues a product manager has to contend with is balancing research for product innovation alongside production of the existing product. Innovation and R&D are very important, because this is the point in product lifecycles where user input is brought in to refine products to meet demographic standards of quality, and it’s also the vehicle for implementing new ideas that retain the sustainability of the product, and keep it from stagnating.
However, production is an expensive prospect, and so, as important as R&D is, production budget must take precedence.
#2 – Store Front Maintenance Vs. Refinement
Another tricky balance is maintaining a storefront versus innovating and improving the storefront. This is a bigger issue in ecommerce, though brick and mortar has this issue to a smaller level. Brick and mortar incurs costs of travel and interaction with retail outlets, and often brings expenses to the company to make changes to how a store is handling placement. However, this is a bigger problem for ecommerce. Ecommerce is technological in nature, and so there is a lot of room for innovation of how the shopping systems, suggestion systems and checkout work all work. However, maintenance incurs a lot of expense, and maintenance is absolutely important for things to work right.
So, the conclusion is once more that maintenance should trump innovation in the budget, though in this case, if the store’s current design is not viable for customers to easily use, this can be inverted until the problem is addressed.
#3 – Using Metrics to Account for Unpredictability
Finally, you’ll find yourself needing to make forecasts for future budget allotments. But, this can be unpredictable, and the only way to prepare for the unknown accurately, and not undercut or overdo the budget for the next fiscal period is to base patterns on metrics of what is costing the most and what problems recur.
Metrics such as customer experience concerns, expenses incurred by maintenance and repair, problems and logistics from production and other concerns must be defined, measured and tracked religiously. We’ve covered many of these metrics in more specific fields previously, and we’ll probably do a piece in the near future addressing product management metrics directly as well.
Of course, these only scratch the surface of product management budget strategy, it’s impossible to get technical and in depth here, but this should give you a sense of priority for what needs the most resources, and a good starting point for learning how to address the unknown.
