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The 7-step product management process explained
Transforming an idea into a profitable product can be challenging. But with the right product management process, you can streamline your workflow and maximize your product's chances for success.
Last updated18 Nov 2022
This chapter of our PM guide dives into the seven stages of the product management process. By the end of this article you’ll know how to move through each stage, and will know which specific product management activities help you create a better product.
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What is the product management process?
The product management process describes the steps needed to take a product from its initial concept to its final launch. This process can mean releasing a new product or feature, or iterating on an existing one.
Great product managers understand that while there’s no universal playbook for product management, nearly every product follows a similar journey:
Identifying your target audience
Designing solutions to their problems
Testing those solutions
Delivering a product that meets their needs
Like many other aspects of product management, this process is hardly linear. Instead, it relies on constant iterations that are based on shifting user and market needs.
The nature of this type of product management process allows your product team to decide exactly which initiatives will have the biggest impact and greatest ROI closer to the time of implementation. It also provides some flexibility as you gather more information and make technological advances.
Customers' needs evolve, and with them, so must the products we build. Therefore, the process is iterative; no matter how mature your product is, teams always need to be running through the build-measure-learn loop to keep meeting their customers' needs.
Implementing an effective product management process helps you create a product that meets users' needs. By breaking up product development into stages, you:
Prioritize your resources, and use them in a more efficient way
Don’t skip essential stages, or the tasks critical for each particular stage
Make sure you work on the right product optimizations, at the right time
The 7 stages of the product management process
Following the right product management process increases your product's chances of success. What that looks like may vary from organization to organization, but we’ve identified seven stages to help organize your process. Let’s take a closer look at each of them:
1. Finding the problem you want to solve
The first step in a product manager’s process is to identify opportunities. Whether it’s developing a new successful product, or improving an existing one by adding new features, the product management process starts with the ‘why’: understanding why the user has a problem and how the product can provide a solution.
But product managers don’t have to discover problems—and generate solutions—alone. This stage involves creating strong lines of communication between stakeholders and across teams, including product, engineering, design, sales, and marketing.
That way, product managers can discover critical problems by listening to a variety of stakeholders—from business leaders to customers.
💡 At this stage, it’s important to take time to survey your customers, prospects, and internal stakeholders to identify any problems to be solved and your users' jobs-to-be-done (JTBD).
Identify user needs
Knowing your customer is the basis for creating a successful product. And figuring out which user pain points your product could address starts with identifying user and market needs.
This can be done through behavior analytics, user surveys, and competitor analysis. The goal is to create and deliver a product that will be in demand by addressing specific problems and evaluating the need for a particular solution.
Pro tip: understand your users’ behavior and motivations.
Observe and understand how your users behave online by analyzing session recordings and user data to learn what they need from your product and why. Then, supplement this behavioral data by reaching out to your customers using a feedback widget to gain further insight.
Together, this type of research helps you figure out how users reason and choose between different alternatives, how they conduct research, how their surroundings influence them, how they react to marketing campaigns, and much more.
Once you’re confident in your research conclusions, you can begin brainstorming product ideas.
A Hotjar session recording in the wild
Manage product ideas
As the ideas come pouring in from multiple channels, you need to capture, manage, and tag them for evaluation.
Maintaining a transparent system for collecting, aggregating, and storing ideas is crucial so as not to get overwhelmed by your product backlog. It also helps various stakeholders—like team members, customers, or even board members and investors—realize their idea isn’t the only one in the running for possible implementation.
Idea management is an ongoing process, and product discovery should never stop. Keep going back to user feedback and use their insights to further develop your product and help it stay relevant.
2. Questioning the problem and defining your vision for a solution
At the next stage, product managers start thinking about business goals. They run user interviews and competitive analysis to understand how solving the problem identified in the first step could help their product meet user goals—like creating customer delight—and organizational goals—like profitability.
The main point of this stage of the product management process is to check an idea's feasibility. There's no sense zeroing-in on an idea that you can't build.
Develop a product vision
Once you’ve determined the problem to be solved or JTBD, develop a hypothesis or vision to share with the rest of your product team.
Your vision is the narrative that informs how you build your product. It defines the final product and shows the direction towards achieving it. A well-specified product vision answers questions like:
How big is the opportunity for this problem?
Will people pay for solutions to this problem?
Do solutions already exist? Do they work?
How can we measure the success of the product?
3. Testing possible solutions for value and feasibility
Once you’ve identified the right problem, it’s time to work with your team to generate ideas for product solutions.
The ideas collected during market research and product discovery need to be translated into technical specifications. Product managers typically work with product owners, project managers, or Scrum masters to produce a list of requirements and convert them into user stories.
This usually happens in close cooperation with the UX team, who develop a mock-up design or wireframes and build prototypes to test the possible value and feasibility of different ideas.
At this stage of the product management process, product specifications should be short and answer important questions like:
What are we building, and why?
What should this new product achieve?
How do we measure success?
Sketching out the product requirements during this stage gives you a sense of how big an undertaking a given item or initiative might be. With this estimate in hand, you can start building the product roadmap with a realistic idea of what’s achievable during a given timeframe.
Pro tip: analyze how people navigate your existing interfaces and collect feedback from current or potential users.
Good user interface (UI) design starts before you drag elements into your wireframe. Before deciding which solution to focus on, use Hotjar to do more research and gather feedback to help you understand what’s most important for your users:
Use Heatmaps to see if users click where you want them to
Watch Recordings to learn how users navigate between pages
Set up Surveys to understand your users’ goals and JTBD
Add a Feedback widget so users can tag UI elements with their comments
A Hotjar heatmap in the wild
4. Defining a solution and building a product roadmap
When a practical solution has been identified, it’s time to define a clear product strategy. While a vision defines the goals for a product, a strategy describes a way to achieve them and sets main milestones.
💡 An effective product strategy defines the main features of a product, user personas and their needs, and key performance indicators (KPIs) that the product must meet.
Build a product roadmap
Once you have the vision, know the market, and understand customers’ needs, you can start to define a product roadmap—a clear and realistic plan for the team who works on a product.
At this stage, the goal of the product roadmap is to emphasize meaningful outcomes that influence North Star metrics, KPIs, and strategic goals.
Start by selecting which high-level themes should be worked on at different times. Instead of focusing on specific features, use themes to outline the product vision and describe your strategic and business objectives, and illustrate the vision, goals, and current state of product development. Each of your themes should reflect the value you’ll provide to your customers.
Within your product roadmap, create specific and measurable goals at the theme level to help you stay on track. By focusing on the overall objectives and your North Star metrics, your product roadmap proves you know where the product is heading, but also acknowledges that there could be different ways to get there.
Note: check out our full guide on product roadmaps to learn more about strategic roadmaps, their types, and how to build one.
Get cross-functional buy-in
Persuading stakeholders to support—and allocate resources to—your product ideas is a crucial part of the product management process.
Part of the product manager’s responsibility is to communicate strategy to stakeholders to ensure they understand and get on board with the product vision and its execution.
Stakeholders—like executives, reps from other departments, or even customers—have a significant influence on product development, being able to alter the budget or change the timeline. Some can suggest implementing product features they find necessary and important, but which might be useless to users.
A high-level, theme-based roadmap, and a shared goal—like a North Star Metric that’s easy to digest—can be tools of communication for those less involved in the details of the project.
As you present your roadmap to executives and other decision-makers, keep highlighting how you’ll add value to your customer and the business. This will help you get buy-in before going ahead with the product plan.
5. Prioritizing product features and initiatives to achieve your goals
Now that you’ve set the high-level goals and built a backlog, it’s time to prioritize your possible solutions.
In product roadmap prioritization, the goal is to prioritize solutions that will add the most value to the user and bring your team closer to achieving your business objectives. This can be one of the most challenging aspects of the product management process, as it may require you to say ‘no’ to stakeholders or customers.
To help with this challenge, use a prioritization framework to structure your backlog of features according to the ones that will have the most impact on your strategic goals. Whether it’s a product tree or a scoring model like RICE, this will determine which items should be worked on first, based on how they’ll impact the product’s vision, strategy, and KPIs.
💡 Whatever prioritization approach you choose, make sure you involve key stakeholders and that their voices are heard. Use your soft skills—like empathy and listening—and your ability to influence to bring people on board with your product strategy.
6. Building a minimum viable product (MVP) to test the value of your solution
With a roadmap and set of prioritized items in place, it’s time to start building and shipping.
How products are delivered can vary from organization to organization:
In some cases, teams work on detailed project plans with few and far-between releases, only shipping when large chunks of functionality are completed and tested
In agile teams, the work is divided into smaller chunks which are completed in sprints, with frequent iterative improvements to the product and quicker release cycles
Some companies take this even further with continuous delivery, where new functionality, bug fixes, and other changes ship as soon as they’re completed and tested
💡 Regardless of your delivery approach, product management’s role is to ensure that what’s being built meets the requirements and expectations of the market and stakeholders.
Guide product development execution
As a product manager, your role at this stage of the product management process involves taking a step back, and serving in a more guiding, advisory, or consulting role as engineers and project managers take the reins.
You should still be available to define, clarify, and validate that the work being done will achieve the intended goals of the project. However, the developers who may have been involved in the process of defining tech specifications become the key players.
Once they finish building your product or new features, the product manager can then review and approve for beta or public product launch.
Develop an MVP
Creating a minimum viable product involves building a simple version of the product with basic features, and releasing it onto the market to test its functionality.
This MVP helps you get validation for your ideas and features so you can improve them in the final product, and get closer to achieving product-market fit. It’ll also allow you more flexibility for future iterations—based on responses from the product’s initial users—to adapt the solution and tweak your product positioning.
Focus on delivering value by prioritizing features that solve the customers' pains or enable higher customer engagement. The ultimate goal of an MVP is to test the product's value and see the first reaction to the solution your product provides to the users’ problem.
Pro tip: use Hotjar to outline and build your MVP.
Use your product research, buyer persona knowledge, and value proposition to build a version of your product with only the basic functionality. Hotjar’s product experience (PX) insights can help you:
Move faster in the product development journey by testing core features sooner
Prioritize features effectively by understanding which ones resonate with customers
Base your product decisions on customer feedback, rather than assumptions
A Hotjar feedback widget in the wild
7. Releasing the MVP, measuring success, and iterating based on feedback
Once a final product has been delivered, it's time to test it with real customers. This is often where the best ideas come from—leveraging user behavior data and feedback to inform further feature prioritization and development.
💡 The product management role shifts to gathering user feedback and prioritizing tasks in the product backlog to ensure bugs are fixed and new features are added.
Testing your MVP helps you understand if your basic product helps customers achieve their goals. Your users are the only ones who can help you understand which features you need to prioritize, and the changes you need to introduce in the final product, to help bridge the gap.
Evaluate your success
After the product launch, it’s your responsibility as a product manager to monitor its progression and analyze key product management metrics and KPIs to understand your product's success. These metrics include:
Financial metrics, such as Monthly Recurring Revenue (MRR), that show the revenue related to the product in one month
User engagement metrics like session duration, which measure how long the product was used; and number of sessions per user, showing how often the site is used
Customer satisfaction metrics, such as Net Promoter Score® (NPS), which defines the number of customers likely to recommend the product
Hotjar’s Director of Product Management, Alessandra Scheffer, sees this stage as critical to the product management process. She says “the phase after the release, the post-release phase, which is about measuring the success of what was released, should inform further improvements and iterations based on the data points observed.”
Analyzing these types of metrics will show you how well the MVP performs and if any improvements are necessary—like adding new features, adjusting the sales strategy, or updating the marketing campaign.
Collect user feedback
A shipped product, even in its most basic format, means a new selection of users to collect and solicit feedback from.
At this stage, the product manager should define a process for capturing and organizing this feedback that closes the loop with customers who offer their opinions.
A good feedback mechanism allows you to check how a user interacts with your product, capture feedback, and find possible improvements. You can then communicate the product requirements to the team, implement changes, and test again, repeating this cycle during the entire product management process.
You can collect direct feedback through interviews, surveys, or feedback widgets, or observe user behavior using tools like heatmaps and recordings. Capturing this quantitative and qualitative user data will help you better address user needs, which will make it easier to achieve product-market fit:
Use Hotjar Heatmaps to analyze aggregate user behavior on your website and see which elements users click and scroll through. You can even use Heatmaps in conjunction with A/B testing to understand more precisely what the best version of your site will look like based on user data rather than guesswork.
Watch Hotjar Session Recordings to get a play-by-play of how individual users interact with your product by analyzing mouse movements, scrolls, and navigation. Recordings are a fantastic way to understand exactly what your users experience and how they navigate your MVP, so you can iterate on your features based on a genuine understanding of the user experience.
Next steps in the product management process
The product management process is, at its core, a process to reduce uncertainty. The steps and stages outlined above can help guide you through the process, but there are plenty of reasons to wander off this particular path—like to prioritize before building a roadmap or spending more time creating product specs before launch.
Even if you choose to complete these steps in a different order, they’re all ingredients to building products that both delight customers and achieve business goals.
Build a better product with Hotjar’s insights
Hotjar provides you with the product experience insights you need to build a product customers love.