Product Team Structure: 6 Options for Your Business

Product Building

by Marta Kuzma , 23 August 2022

Achieving your business goals requires careful planning — especially on product development initiatives. Effective project planning considers your workforce in addition to your project management methodology. 

Building a good product team involves:

As the workforce landscape continues to change, having the right product team structure is crucial. It builds an environment where teams can collaborate, overcome obstacles, meet deadlines, and work together to reach goals and create better products. On the flip side, a dysfunctional team with no structure is bound to struggle. 

Product Development Team Roles 

Most product teams are comprised of:

  • Product manager: The visionary who carries the responsibility of forming and communicating the product’s development. 

  • Product designer: Governs the functional enhancement of the product. This includes controlling the backlog of user stories, planning the UI/UX, and advocating for customers in the decision-making process. 

  • Business analyst: Oversees the financial side of the product. Their duties involve creating budgets and forecasts, both within the company’s fiscal plan and regarding market performance.

  • Quality assurance tester: Examines the product during and after its development to ensure it functions properly and meets company standards. A QA tester should identify a product’s flaws before its public release.

  • Product marketer: Plans the advertising campaigns for promoting the product. They know the merchandise and target audience well enough to create a suitable marketing strategy.

  • Development team members: The remaining stakeholders who execute the tasks determined by leadership. 

How are product teams structured in a startup? Because most startup companies are too small to implement an organizational structure with that many members, they typically distill these responsibilities into three primary roles: a product manager, an analyst, and a product owner. Regardless, whatever roles your team has must be strictly defined. 

How is a product team structure different from a matrix structure? A matrix structure is an organizational structure that focuses on managerial oversight. It’s a hierarchy with chains of command that maintain accountability and supervise each employee’s performance. 

On the other hand, a product team structure prioritizes the creation of new goods or services instead of professional development. Thus, it looks at the functional contributions of team members and distributes authority accordingly. This approach favors product-oriented outcomes.

Employees on a product team may report to two leaders: a product manager and a direct supervisor. In contrast, freelancers may work with a product manager but not report to a direct supervisor.

Product Team Table

1. Dedicated Product Manager Per Product/Feature

You don’t need a complicated product team structure to be successful. For many companies, a basic arrangement is enough to organize day-to-day operations. That’s why this method of dedicating managers to specific products or features is so common.

In this approach, one product leader oversees each product that your business produces. They are in charge of guiding the strategic planning and implementation. The manager is accountable for:

Because this structure entrusts one manager to direct a product’s development completely, each product team is relatively siloed from the others. Each standalone crew is responsible for their part and rarely collaborates, as a different manager oversees each different product.

If an entire product is too involved for just one person to manage, you can divide ownership among multiple managers. Each can govern a facet of the product, ensuring it’s effectively developed and designed to align with the other product components.

Best for: This framework is best for large companies that already have an established product line. A Chief Product Officer or VP of Product can govern all product managers to maintain cohesion across the business.

2. Divided Responsibilities by Product Manager Skillsets

This approach assigns responsibilities based on each manager’s skills rather than by product ownership. Dividing duties this way means you leverage everyone’s strengths for better results and greater innovations. 

Your company can have managers who oversee

This makes it easier to roll out new products without having to overhaul responsibilities or employ additional managers. No single person owns the product vision completely, as it must be shared among all managers. Teamwork is crucial.

The potential downside of this procedure is that all teams/products can suffer if one manager can’t handle their responsibilities  — or leaves your company entirely. 

Best for: This product structure is most suitable for companies with long-tenured, reliable contributors. You need professionals familiar with your business offerings who can effectively collaborate with fellow managers. They can use their expertise on a certain business aspect to help produce successful products across multiple departments.

3. Autonomous Product Squads

Many companies benefit from having multidisciplinary product teams. What makes the product squad system unique is that each small, cross-functional group can enhance or create new features on a product without executive oversight dictating the product strategy.

Spotify has shown how this approach can be effectively applied, as has Amazon’s “two pizza” team size. A product manager supervises small teams of a half-dozen cross-functional developers. Those product squads can develop a facet of a product from start to finish — planning, creating, testing, and launching on the market.

To make this work, you’ll need trustworthy, competent developers with varied backgrounds and a wide array of proficiencies. These cross-functional teams need to make smart, strategic decisions to improve your products without relying on your guidance. Using an Agile framework will support self-managed innovation.

Best for: When executive leadership wants to give squads a high level of autonomy. This freedom encourages creativity by letting stakeholders pursue fresh ideas. And, it allows product teams to generate and launch product enhancements without the delays of administrative formalities. No need to bother with red tape getting in the way!

4. Product Managers by Customer Segments

This approach divides work based on your customers instead of your products or features. One practical method of doing this is to structure teams and assign managers based on different demographics. That way, your team can prioritize creating great products that meet needs and solve problems for specific customer bases.

Because responsibilities are divided by customer segment rather than product expertise this system relies on cross-functional teams to perform an array of tasks. 

It  requires extensive knowledge of your customer base, both existing and target users. A team has to recognize their demographic’s:

  • Lifestyle

  • Needs

  • Expectations

  • Values

  • Priorities

  • Habits

  • Preferred competing brands/products

Best for: Organize around customer segments if your company has a diverse product line that appeals to specific customers. This system is also great for forming new products or new features that target the needs of those customers.

5. Product Managers by Customer Journey Stage

Another way to structure your teams to bolster your customers’ experiences is to prioritize personas. Making the customer journey the foundation of your team structure puts user experience first while generating a robust product.

Each manager is responsible for upholding a stage in the customer journey as follows: 

  • Awareness: Making sure people know about the brand’s products & services

  • Consideration: Making it easy for customers to get to know the product enough to compare to other brand’s offerings

  • Purchase: Ensuring the purchasing process is user-friendly

  • Retention: Finding ways to turn one-time buyers into loyal customers

Best for: Products or services that involve a linear user experience. The customer journey map should be streamlined and predictable so you can depend on it. You need a clear, well-defined audience and can easily establish metrics for tracking progress. Such limitations restrict this approach’s viability for many products depending on the industry. 

6. Product Managers by KPIs

Performance metrics can provide a clear, actionable framework for developing your product. That’s why some companies prefer to establish their team structures based on key performance indicators. You can develop a high-quality deliverable by using performance metrics to track progress. 

This approach is somewhat flexible, as you can set KPIs based on skill-based activities or functional product improvements and align the workflow accordingly. Each product manager is in charge of fulfilling certain goals for the product. Developers’ responsibilities are either skill-based or task-based, depending on the objectives.

Best for: This approach can propel you toward end results faster than other methods. Try using a KPI-focused team structure when you need to overhaul or launch a product with clear, time-sensitive objectives in mind. 

Embrace Evolution — of Your Product and Team Structure

No market or product stays the same forever — so why should your team structure? Find the organizational approach that works best for your needs. It takes time and appraisal to hone your ideal arrangement. Don’t be afraid to change your development process down the road to meet the evolving needs of your customers and your industry. 

MVP Match wants to help you create great products by connecting you with skilled experts. Hiring a freelancer for your product team will help you bypass the stress of onboarding and retention. You’ll have the right assistance for as long — or briefly — as you require.

Build amazing products withamazing teams

Start Building