For all practical purposes, there is no basic difference between program management and project management. But what about product management? Project management and product management are similar, with one major exception: The project manager focuses on the end date of his project, whereas the product manager is not willing to admit that his product line will ever end. The product manager wants his product to be as long-lived and profitable as possible. Even when the demand for the product diminishes, the product manager will always look for spin-offs to keep his product alive.
Figure 2–10 shows the relationship between project and product management. When the project is in the R&D phase, a project manager is involved. Once the product is developed and introduced into the marketplace, the product manager takes control. In some situations, the project manager can become the product manager. Product and project management can, and do, exist concurrently within companies.
Figure 2–10 shows that product management can operate horizontally as well as vertically. When a product is shown horizontally on the organizational chart, the implication is that the product line is not big enough to control its own resources full-time and therefore shares key functional resources. If the product line were large enough to control its own resources full-time, it would be shown as a separate division or a vertical line on the organization chart.
Also shown in Figure 2–10 is the remarkable fact that the project manager (or project engineer) is reporting to a marketing-type person. The reason is that technically oriented project leaders get too involved with the technical details of the project and lose sight of when and how to “kill” a project. Remember, most technical leaders have been trained in an academic rather than a business environment. Their commitment to success often does not take into account such important parameters as return on investment, profitability, competition, and marketability.
To alleviate these problems, project managers and project engineers, especially on R&D-type projects, are now reporting to marketing so that marketing input will be included in all R&D decisions because of the high costs incurred during R&D. Executives must exercise caution with regard to this structure in which both product and project managers report to the marketing function. The marketing executive could become the focal point of the entire organization, with the capability of building a very large empire.
Source : Project management A system approach to planning, scheduling and controlling [EIGHTH EDITION] By HAROLD KERZNER, Ph.D.