Telling you how to manage a product is good, but illustrating this for you using practical examples is way better: SuperStockApp, Inc. is the company that created SuperStockApp, an app that is supposed to make stock investing as easy as possible. If you do not have any background in stock investing, this post explains two fundamental problems that stock investors face, namely (1) how to pick a stock to buy and (2) how to track the performance of your stocks after you have bought them. No matter whether you will be working on a stock app or something else: as a Product Manager (PM) you always need to understand the problem space first and this post gives you the necessary background on stock investing so that you can follow the rest of my posts and videos in this blog more easily whenever I am referring to SuperStockApp.
A consistent example will make it easier to illustrate important concepts of Product Management and how to set up an organization for continous success in delivering products that are relevant in the market and that scale. Even though SuperStockApp, Inc. is an example created for this blog, it combines my experience from having worked in large organizations as well as building and scaling a startup. Let us now explore the problem space in which SuperStockApp, Inc. operates.
Stock investors have a common goal. They want to spend money to invest in stocks so that, at some point in the future, they will get more money out of their investments than they put in.1 In order to reach that goal, investors need to solve several problems. Two of these problems we will now discuss as they are relevant for the app that SuperStockApp, Inc. is designing: First, the app should help investors to find the right stocks, i.e. stocks that have the potential to reach the goal. It is not the task of the PM to come up with a novel, ground-breaking investment approach that was never heard of. That task is better given to the experts in the field of investing. However, it is the task of the PM to understand which of the investment approaches that exist today are relevant to investors in the market and how to make them easily accessible to the customers of SuperStockApp. To understand that, the PM will need to conduct market research and get feedback from potential customers. PMs are also encouraged to team up with experts to better understand the field in which they are designing products. It is not possible for the PM to do a good job without getting familiar with the specifics of the problem space. Depending on the capabilities of your company, your company may even want to hire experts to have this expertise in-house or work with external advisors, but in this day and age an exciting new possiblity emerges. PMs can leverage Artificial Intelligence (AI) to accelerate the learning process and understand trends in the market. Either way, once the PM knows which investment approaches are relevant, as a next step the PM needs to figure out how to make these investment approaches accessible to customers in the most intuitive way by designing an appealing User eXperience (UX) that resonates with their target audience.
Second, once an investor has bought one or more stocks, the investor needs to understand how these stocks perform to understand how well the goal has been reached. Several stocks are managed in what is called a portfolio and the product should be able to track the performance of that portfolio. If the problem space is more complex, a dependency between different problems is not unlikely. In the case of stocks, future buying decisions may depend on which stocks are already in the investor’s portfolio. In investing, the reason for this dependency is risk management. Depending on the investor’s strategy, stocks may be bought across different sectors (e.g. information technology vs. health care), or across different countries (e.g. United States vs. Germany). The rationale behind this is that the more diversified the purchases are, the less likely it will be that a bad performance in a single country (e.g. the economy in Germany is dwindling) or a single sector (e.g. real estate growth has slowed significantly) will have an adverse impact on the overall performance. On the flipside, if a single country or single sector performs extraordinarily well, the gains will be limited in the same way. This is a well known trade-off in investing between risk vs. gain that you may want to consider when designing your product. In this case, future iterations of the first problem, i.e. which stock to buy, will depend on on the second problem, i.e. which stocks already made it into your portfolio and how your portfolio is performing.
An important conclusion from discussing the example of SuperStockApp is this: if you really want to excel in what you are doing as a PM, a genuine interest in the topics that your customers are interested in is mandatory. If you cannot get excited by these topics, you may want to choose a different problem space because otherwise it will be unlikely that you can consistenly work on solving your customer’s problems if the problem space is of little interest to you. If you do not like stocks and investing, do not apply for a PM position at SuperStockApp, Inc. While it is not impossible to get the job done, it will be significantly harder for you because you will often feel less motivated than if the problem space is genuienly exciting you. If you ever have to decide between different PM positions, choose the one whose problem space you find more intriguing.
- It should be noted that there are more goals in investing than just one. Investors may alternatively be looking for investments that guarantee a recurring stream of income in form of dividends. In this case, they will not want to get more out of the investment than they put in, but rather they want to maximize their regular dividend payments. âŠī¸