Hey there! I’m Ksenia, and today we’re delving into the realm of the chief product officer (CPO) role.
If you’ve recently stepped into this position, you might have realized that it’s a whole new ball game. This article is a guiding light for those aspiring to take on this role. I will navigate through the first crucial months, offering insights on how to excel in your new responsibilities and embrace the exciting challenges that lie ahead. As someone currently serving as a CPO, I’ve gathered some valuable insights to share.
The unanticipated challenge
Raise your hand if you’ve transitioned to the CPO role recently.
Now, if your expectations are perfectly aligned with the reality of this new position, kudos! However, it’s common for aspiring product managers to yearn for the CPO role, yet realize the gap between their expectations and the reality upon stepping into it.
A top-tier product manager might not necessarily make a top-tier CPO, and this discrepancy poses several challenges.
The ripple effect of unpreparedness
The repercussions of this mismatched transition are substantial:
- Companies invest time and resources, awaiting the CPO’s effectiveness
- Unprepared CPOs make hasty decisions, causing lasting consequences
- Uncertainty from the CPO trickles down to the team, affecting their motivation and performance
- The CPO’s doubt in their capabilities leads to potential burnout or even dismissal
This dilemma impacts everyone involved and perpetuates a cycle that’s tough to break.
Let’s delve into how to navigate or mitigate this situation when entering or preparing for the CPO role.
Initiating your CPO journey
Your first step should be clarifying expectations, akin to any product position:
- Gain insights into what’s expected.
- Understand timelines, available resources, and budgets.
- Grasp the overall state of the company (do the founders want to sell the company, make it to the unicorn status, or just become self-sufficient?).
- Recognize the company’s goals and their division across verticals like development, sales, and marketing.
- Most importantly — learn why the goals that have been set before you haven’t been achieved yet. What are the key limitations or obstacles?
This groundwork is essential before accepting an offer or promotion.
Unlike the product manager’s perspective, the CPO’s role involves understanding the company’s business model, markets, long-term goals, value proposition, and marketing channels. You’ll delve into P&L, financial dynamics, and evaluate the entire development process to make sure you can deliver what’s needed and expected of you. Do your diligence before you step in.
Following your candid evaluation, consider the following step:
- Start with a well-deserved vacation. A break will recharge you for the tasks ahead.
Setting the course
Let’s proceed to charting your course. This is what I would start with if I were to start working as a CPO in a new company.
- Start with a simple analysis.
- Seek to understand the company’s vision and goals before making decisions.
- Don’t succumb to the pressure of impressive numbers or grand promises if you’re uncertain about the company’s trajectory and your resources.
- Evaluate essential data from the product’s past year, or preferably, a couple of years if it’s been around. It’s useful to analyze NPS, CSAT, profitability, and other key metrics for your company. This exercise will give you valuable insights into seasonality and help make predictions for what can work and what will not.
- Do the same with metrics trends to understand customer base growth/churn, financials, and strategic goals.
- Assess your team — understand who’s responsible for what, their impact, motivation, and morale. Never skip this step.
- Scrutinize sales results, uncover correlations with new features, and grasp customer feedback.
- Gain insight into marketing’s perception of the product and what attracts users. How you communicate your value to the outside world is as important as delivering high-quality products.
Deciphering financial realities
With data in hand, turn your attention to financial metrics:
- Collaborate with your chief commercial officer to understand financial aspects like earnings, expenses, and resource allocation.
- As a CPO, you’ll deal with concepts like EBITDA, profit and loss reports, debit, and credit. I recommend studying these beforehand to make sure you’re knowledgeable enough to follow the conversations
When you have this information at hand, it’s time to turn to the three most important things in the life of a young CPO.
1. Crafting a cohesive strategy
2. Inspiring your team
3. Learning a new level of communication
In order to make the best strategy, remember to treat each conversation with your new stakeholders like an in-depth customer interview. It will help you to uncover the true picture, not just scratch the surface, and find the socially acceptable truth.
Understand how all departments interconnect and contribute to the larger picture. The best strategy is the one that takes into account all limitations and peculiarities. For example, you can’t scale X2 in six months if the infrastructure you currently have only supports X0,5 and the team isn’t planning on expanding.
Learn what the strategic goal of the product and the company is. Is it to be acquired? To secure investments? What’s needed for that? What are the requirements of investors, the board of directors, and your CEO?
Key points about creating your initial strategy are:
- Develop a strategy for 3, 6, and 12 months.
- Understand that your first strategy won’t be perfect, but it’s a valuable exercise.
- Align your product strategy with company-wide goals. Make sure you have approval from all the key stakeholders.
The next big thing is managing your team. The best you can do here is to understand your people and make sure you lead by inspiration and personal example.
First, seek to learn more about your team. What motivates them, what their personal and professional goals are. Make sure you have a plan at hand to help them succeed. Talk to HR to find out what’s going on. Do employees leave often? What’s the primary reason? What does the hiring process look like? What are the results of the 360 review?
People are your primary asset; so spend as much time with your team as needed to help them deliver their best.
This being said, sometimes you’ll need to fire someone on the team as well. Make sure you do it as ethically as possible. If it’s a toxic employee, don’t let it fester. Make it quick and transparent for everyone. If it’s poor performance, talk to the person to help them learn the lesson and do better at their next job. It won’t take too much time, but it’ll show great care and respect.
Finally, make it about creating a dream team. Your goal is to have everything up and running without you being present.
Effective communication is the last pillar in this trilogy for new CPOs
Hard skills are not enough anymore. Communication becomes paramount in your role. It’s crucial for your reputation both within your company and to the outside world. This is the time to practice your best presentation and debating skills. It’s best if you learn them beforehand though.
In order to succeed you also need to have a firm understanding of the company's mission and vision, market dynamics, overall trends, and opportunities. This is what sets a good CPO apart.
As a bonus, I’ve also prepared a short and sweet guide for aspiring CPOs:
- Assume more responsibility in your current role by practicing strategy development. Even if your job is to create a strategy for one small feature, try and see how it can bring impact to the company overall. The best part here — you aren’t fully responsible for the overall vision, so you can practice as many times as you want.
- Seek a mentor who’s achieved the CPO role at your dream company. Learn from the best to become the best.
- Cultivate awareness of industry trends, successful products, and emerging technologies. I use Reddit and a couple of news subscriptions I’ve found through LinkedIn to make sure I stay up-to-date on the latest trends.
- Expand your network through conferences, meetups, and online groups.
- Establish your reputation through writing, speaking engagements, and successful case studies. Make sure you’re the one companies will fight to hire by bringing the best results and being open about your failures.
Your journey from a product manager to a chief product officer is both exhilarating and challenging. By understanding the nuances and being prepared, you can rise to the occasion.
As I conclude, remember: the role of a CPO isn’t just about managing products; it’s about steering a ship toward its destination, factoring in every department, resource, and metric. May this article empower you to embrace your new role with confidence and thrive in the ever-evolving world of product leadership.