Product Management Outlook for 2024
Trends, challenges and opportunity in tech and product
2023 was a very tough year for the tech industry, with massive layoffs and companies closing shops. Raising funding was challenging, the sales process was slower, and many companies were not growing. Companies had to either restructure themselves, pivot or make tough people decisions to stay afloat.
Product teams were at the center of this turbulence: some successes and some failures. The hard lessons will not be forgotten soon. 2024 presents new opportunities to try again. How will the product management landscape pan out in 2024? I'll be sharing my five Outlooks below.
The job market will continue to be saturated
Many product teams were laid off in 2023, meaning there is an oversupply of experienced Product Managers (PMs) in the job market. This applies to other roles as well. Junior PMs (with little experience and low cost) will continue to flood the market as it is still an attractive career choice.
In the foreseeable future, in 2024, companies will believe and act that the tech winter will continue and will want to drive management efficiency. This has bigger implications for PMs. Without an engineering team, a PM is effectively useless. The ratio of product managers ranges from 1:2 to 1:15 . For smaller companies, PMs could even be sharing engineering resources. Before we can see any improvements in the PM job market in 2024, we need to see a rise in engineering roles.
For this to happen, the tech industry needs some general recovery. Of course, this is tied to the interest rate and tech companies' ability to raise more money. If the interest rate remains high, it will continue to drive down startup valuation and lower fundraising. However, the summary of economic projections issued by the U.S. Federal Reserve in December indicates that there might be some cuts in interest rates this year.
The S&P 500 U.S. stock index rose 24% in 2023 after a year-end rally. That surge reflected investors' expectations for lower interest rates in 2024. While I do not expect the rate cuts to improve significantly, some confidence might return to the technology industry (at least growth stocks will benefit).
But, for most of 2024, I expect fewer product management roles and a more competitive application pool. While the job market will become more competitive, it will remain an attractive goal for entry-level talents. This applies to other roles in technology.
Product teams will be expected to create more value with fewer resources
Technology companies that raised money in 2021 or 2022 will most likely run out of cash in 2024 if the VC industry does not pick up. This will cascade down into management efficiency. Your budget request may not be approved because management is cutting costs. PMs will be expected to do more to justify their cost and value to the company as roles would be consolidated. Exited colleagues will create gaps that PM would want to fill.
I also expect to see more pushbacks on long product development cycles and a drive towards faster deliveries, even if the engineering resources are not growing. Many engineering teams are oversized and must learn to scope the smallest, most profitable release to move fast.
Slower sales cycle would be blamed on the product team because they are not delivering features fast enough. This will force PMs to put pressure on the engineering team. PMs will adopt more tools to become efficient at work and wear more hats to get things done faster. Also, PMs will communicate more visibly to convince people they are adding value. Unfortunately, convincing others that you're creating an impact is more important than actually making an impact.
There would also be less software development waste. Companies will be critical of products or roles that do not directly contribute to revenue. There is an increasing focus on profitability across tech companies, which is expected to continue in 2024. There will be a focus on time-to-revenue and margin contributions. These will be the metrics of successful companies in 2024. More companies will turn their cost centers and internal infrastructure into revenue opportunities.
I expect companies to tighten the relationship between revenue outcomes and product development. There will be trimming down of various product initiatives that do not contribute to profitability, even if that leads to more technical debts. Product managers with strong commercial sense will continue to find opportunities to rise.
Gen AI features and products will cool down
In 2023, the hype around Generative AI was immense. Almost every day, a new AI feature or product is being launched. The excitement around AI was at its peak. Investors were pouring money, and valuations of AI companies were skyrocketing despite the tech downturn. Most product roadmaps have AI somewhere down the line.
Some companies had to rebuild their landing pages to get into the AI wave. The initial rush to build a shiny AI feature is turning out results, and companies are rethinking whether AI is the best way to spend their money. When Discord shut down its chatbot, I wrote an article explaining why I believe it was not a successful experiment.
Models like OpenAI's ChatGPT, Google Bard, Anthropic's Claude, and Synthesia require large computing power. The deployment and maintenance cost of running a Gen AI model is very expensive. It will force product teams to reconsider whether the value to end users and to the company can justify the cost.
I expect many companies to slow down their product roadmap on Gen AI features in the short term. Of course, companies will continue evolving their understanding of AI's broader implications for their businesses and industries.
While this slowdown is happening, I expect companies to revisit their infrastructure architecture, particularly for Gen AI purposes. For instance, some companies would be adopting new types of databases that will allow efficient storage and retrieval of data for AI model consumption.
We will also see the rise of pre-trained models that will provide context-awareness to AI models, remove the need for extensive training, and possibly reduce costs. There will be more work to intensify AI model efficiency, performance, security, and scalability.
Also, the proliferation of Gen AI tools has created new problems that must be solved. We will see a comparative rise in tools like AI Plagiarism checkers (to check essays/articles written by AI), Internet searches (to label articles or news written by AI), etc. We should also expect more focus on ethical concerns of AI and reactions to emerging regulatory and legislative pressure.
I expect the early winners of Gen AI and large companies to continue to dominate the headlines in 2024. In the long term, AI will have a huge impact on the economy and society at large. It will increase productivity and create a new basis for competition. We are just scratching the surface.
Product management will be increasingly integrated with other functions
As part of the need to drive efficiency, I expect to see a consolidation of product management with other functions such as engineering, corporate strategy, marketing, and design, especially at small companies. This will be driven by the need to reduce management overhead, close communication gaps, and reduce duplication of efforts. Much has been written on the overlaps between product management and other functions.
In 2024, we will see companies take more practical steps to reduce overlapping responsibilities, and one way to do this is to consolidate the function, starting from the management level. I expect to see a rise in titles like Chief Product and Technology Officer or Head of Product and Design, VP of Product and Strategy, etc, to enable companies to drive consolidated product vision and strategy.
At the execution level, for instance, the tech lead may take over product management responsibilities. Of course, many companies have experimented with engineering performing product tasks. However, the results have been ill-conceived features and poor developer efficiency. Some companies will try it again in 2024, but they will lose.
PMs will be expected to develop more skills like low-code/no-code validation and prototyping skills. Product Designers will be expected to do more product thinking. If your job as a PM is setting up meetings and writing user stories, you should be worried.
Companies will believe that integrating products with other functions will create a synergistic environment that minimizes administrative overhead and enhances overall organizational effectiveness. This will help them to optimize resource allocation and develop a shared understanding of user needs.
There will be an increasing demand for individuals with versatile skills capable of handling responsibilities across multiple functions (design, data, engineering, marketing, etc). This is the generalist’s time to shine!
I also expect that the quality of product talent will improve. This will lead to companies having simpler structures with fewer layers of management and reporting lines, where indirect management is more valued than direct management. When companies who are cutting back on Product Management teams later rehire, they are more likely to do so with a flatter structure. For instance, Senior PMs could report to VPs, instead of Lead PMs.
Recruiters will filter roles with domain experience
During hiring booms, companies have the flexibility to hire functional product managers, that is, product managers with experience in general product management. However, companies need domain and functional expertise when things get tough. Functional PMs are those with soft skills needed to perform general product management activities, like communication, stakeholder management, discovery, etc.
PMs with domain expertise and skills bring in-depth industry knowledge to the team and can deliver more value than a functional PM. While it is correct that PMs can learn about the industry on the job, companies will increasingly use domain experience as a filter while recruiting since the application pool is more competitive. I expect more PM job ads with descriptions like “At least 3 years of experience in card payment.”
Domain experience should not be confused with technical/engineering skills. Domain experience concerns the market, customers, industry, competitors, products, etc. Of course, this includes some technical knowledge, but the focus remains on the market. It requires someone who can sense the market and guide the product in the right direction. Having domain experience will facilitate the process of competitive analysis, market research, and product strategy.
Great PMs possess an aggressive and resourceful learning style and should ideally not be hindered by a lack of domain expertise. However, in tight seasons like 2024, I expect companies to weigh towards PMs who can demonstrate domain and functional expertise.
Conclusion
In closing, my outlook anticipates that companies will continue to drive efficiency across the board. Companies will be more top-down in driving alignment and ensuring that products deliver on profitability. Companies will revisit their overall business and product strategy and continue to re-evaluate their market position.
Thriving in 2024 will require high resilience, the passion to drive outcomes, and the foresight for decision-making. Above all, do not be distracted by noise. Keep an eye on the news, but don’t over-index on them. Focus on what matters –understanding your customers, product, and industry in and out.
It’s going to be a long ride. Sit tight and happy building!
About me: I’m a product leader at Stears and convener of Abuja Product Network. I have led teams to build payment, data platform, cleantech and AI products —an excellent thinker and doer. Subscribe to my newsletter on Substack. Follow me on LinkedIn, and X.