How to choose the right product team structure for your SaaS?
This is the main question we discuss in this article, so if you’re after the answer, you’re in the right place!
We also look at:
- Responsibilities of product teams
- Key roles you may want to include
- Different ways to structure your team
- Examples of different structures
Let’s get right to it!
- A product team structure describes how the business organizes experts from different roles and functions to deliver successful products.
- The responsibilities of product teams include facilitating product discovery, launches and releases, customer onboarding, feature adoption, and account expansion.
- Enterprise companies with multiple or complex products tend to have larger product teams made up of specialists, while startups often have to cope with smaller structures where members perform numerous roles.
- A well-structured product team requires a product leader — either a product manager or a product owner.
- They lead a team that consists of developers and designers. In larger organizations, they may work side by side with QA engineers, product marketers, data analysts, or product ops managers.
- In structure by product/feature, the team is responsible for all aspects of the product management cycle, from discovery to launch, and beyond.
- Some companies prefer to organize their teams around product managers with specialist skills, like growth or data analysis.
- Larger organizations, like Spotify or Buffer, have multiple teams responsible for specific aspects of the product, for example, a feature or a pricing plan. Such a cross-functional team, sometimes called a squad, has all the necessary resources and autonomy to release work independently.
- Another way to structure teams is by customer journey stage, where a different team is responsible for one stage, like adoption.
- In structure by segments, product teams group customers according to predefined attributes and each team is responsible for developing the product to satisfy their unique needs.
- In structure by metrics, different teams work to improve different KPIs.
- When choosing a product team structure for your organization, consider your goals, company size, available human and financial resources, and product complexity.
- Userpilot is a growth platform with advanced feedback and analytics functionality. Book the demo to see how it can support your product team structure.
What is a product team structure?
A product team structure is how a business organizes the product team to best support software development.
It brings together experts from different disciplines and functions who work together to design, develop, launch, and support a product.
What is a product team responsible for?
Product teams are responsible for a number of processes that are essential to build successful products. These include but are not limited to:
- Product discovery — market and customer research to identify customer problems that the product could solve and generation of ideas on how to solve them.
- Product onboarding — designing experiences that enable users to discover the product value.
- Adoption — continuously driving product or feature engagement so that they get embedded in users’ workflows.
- New feature launches — planning and orchestrating the rollout of new functionality.
- Upsells and cross-sells — identifying opportunities for account expansion by prompting users to upgrade to premium plans.
What are the key positions in product teams?
The exact roles in a product team depend on the size of the organization, its maturity, and the nature of the product.
In startups with limited resources and smaller product lines, product team members must be jacks of all trades, capable of working on different aspects of the product management process.
In enterprise organizations, on the other hand, the roles may be more specialized. For example, the responsibilities of the product manager may be shared by the product owner, Scrum Master, or project manager.
Let’s look at a few of the possible roles you may consider including in your team.
Product managers lead the entire team and are the product’s champions in front of stakeholders, like customers or senior managers. Navigating the corporate landscape to secure the leadership’s buy-in and resources is a big part of their job.
The product owner is a Scrum role that encompasses some of the responsibilities of the product manager.
Basically, product owners represent the voice of the customer on the team. They collect customers’ expectations and requirements and communicate them to the team. They are in charge of backlog grooming and make the final prioritization decisions.
At the end of each sprint, they are in charge of each demo, during which they present what the team has achieved and collect feedback from the stakeholders.
Product designers are responsible for developing and refining products so that they satisfy user needs.
They are often confused with UX/UI designers and their work sometimes involves these aspects.
However, it’s a business-oriented role with much greater scope. Their job is to identify opportunities to drive product growth by developing solutions that customers love.
The role of product developers is to build and implement the product as per the specifications and requirements.
When the product manager or product owner has limited technical expertise, developers play a vital role in helping them translate customer requests and feedback into backlog items that are realistic to achieve.
They are often a part of the development team and provide them with ongoing feedback to ensure that the product satisfies the needs of the customers and is reliable.
Product operations manager
Product ops managers are responsible for developing and standardizing processes that support the work of the product team.
The role is particularly important in large organizations with multiple teams and/or products. Product ops ensure that all teams and stakeholders communicate effectively and have the necessary data.
They are also in charge of building templates, developing documentation, managing the tool stack, and automating routine tasks.
This involves customer and market research, defining a differentiation strategy, identifying the best ways to reach out to potential customers, designing marketing campaigns, and monitoring their results. They play an important role in product launches.
Apart from that, product marketers can help the team drive product adoption, account expansion, and user retention.
Data analysts ensure that the team has adequate data to make informed product decisions. This involves collecting and processing relevant product data and analyzing it to extract insights.
To support effective goal setting and roadmap development, they interpret the data and present the findings in a way that’s accessible to stakeholders with limited data science expertise.
6 Product development team structures to choose from
How can you structure all the product professionals in your organization?
Let’s look at 6 different ways to do so, along with their pros and cons.
1. Structure by product or features
Structuring product teams by the product is probably the most common way.
In simple terms, the team is organized to deliver and maintain a specific product. If the product is complex with multiple features, the organization could have a dedicated team for each of them.
At the helm of each team, there’s a product manager who reports to the Head of Product, Product VP, or Chief Product Officer (CPO).
Pros and cons of the structure:
✅ Easy to scale.
✅ Has clearly defined roles and reporting lines.
✅ The product managers truly own the product and have the autonomy to call their own shots.
❌ Each team can end up working in its own silo and not benefit from the innovation and experience of other teams.
2. Structure by product managers’ skills
In this model, each of the multiple product managers in the organization is responsible for a specific aspect of the product management process based on their skills and expertise.
Each of the PMs would lead their own team supporting multiple products across the organization.
Pros and cons of the structure:
✅ Allows teams to develop high levels of expertise.
✅ Fosters collaboration between multiple teams.
❌ Very dependent on individuals — a PM leaving the organization would impact multiple products.
3. Structure by cross-functional teams
Instead of expanding the product team to the point where it’s difficult to manage, larger organizations sometimes break it up into multiple product development teams led by product owners or project managers.
Although they are smaller, each such cross-functional product team includes people with the necessary expertise to initiate and deliver product motions independently, without relying on the support of others.
Pros and cons of the structure:
✅ Autonomy to pursue their own product initiatives without excessive oversight from the senior leadership.
✅ Ability to iterate fast on customer feedback or data insights.
❌ Maintaining good communication and knowledge sharing between teams requires good organization and efficient product ops.
4. Structure by customer segments
So if you’re developing a video editing application, you could have separate product teams for hobbyists, professional filmmakers, marketing professionals, educators, and so on.
Pros and cons of the structure:
❌ Duplication of efforts if the teams’ work is not coordinated well enough.
❌ The product may lack cohesion if the needs of different segments are very different.
5. Structure by customer journey stages
In this structure, each of the product teams is responsible for an individual stage of the customer journey.
For instance, there could be a team focusing on increasing product awareness through marketing and another one on driving customer acquisitions, while other teams work to facilitate adoption or maximize account expansion opportunities.
✅ In-depth focus on each individual stage to deliver outstanding customer experience.
❌ Inconsistent user experience at different stages if teams aren’t in sync.
❌ Potential duplication of efforts as certain features might be relevant for different journey stages.
6. Structure by performance metrics
The work of each team is coordinated by the Head of Product or CPO, who sets the goals for each team and monitors progress.
✅ Clear focus.
✅ Easy to measure progress objectively using product analytics.
❌ Not suitable for organizations with constantly changing metrics.
❌ Requires very good coordination as metrics are interdependent. For example, Revenue and Customer Lifetime Value (CLV) depend on customer retention.
How do successful companies structure product teams?
Now that we know the different structures, let’s have a look at a couple of examples of how successful organizations run their product teams.
Buffer, a social media management platform, organizes its teams into squads.
The cross-functional squads consist of the PM, a couple of engineers, a product designer, a customer development expert, and sometimes an analyst.
Each of the teams is responsible for one area, for example, Android, iOS, Onboarding, Extension, or Buffer for Business.
The squads are small and agile, so they can move quickly and work in tight feedback loops.
Spotify, the audio streaming giant, also structures its product teams as squads.
The teams consist of 6–12 people and are normally led by a product owner, rather than the product manager.
Each of the teams has a focus area and complete autonomy over their work. This means they have the freedom to choose their product initiatives and release work without prior approval from the above.
The squad autonomy manifests itself also in how they work. For example, some teams use Scrum while others prefer Kanban as their main framework.
Multiple squads working on the same initiatives form tribes. This allows them to ensure their efforts are aligned with the overarching goals and avoid stepping on each other’s toes.
How does Spotify foster expertise-sharing between teams?
Specialists in a particular field, say JS developers, form Chapters. This allows them to share best practices and maintain high industry standards.
There are also interest communities called Guilds for employees passionate about a particular subject.
How to choose the best organizational structure for your product team?
As you can imagine, the different product team structures will be more appropriate for some teams than others. Here are a few factors you may want to consider and questions to ask yourself:
- Goals and objectives.
What are you trying to achieve? Are you prioritizing any particular metrics or aspects of the product?
- Company size and resources.
Do you have the resources to support multiple cross-functional teams responsible for different areas or aspects of the customer experience?
- Company culture.
Do you want to oversee the work of your team closely? How much autonomy can you give them?
- Product complexity.
Is one integrated team enough to cover the whole product or do you need dedicated teams for different features? If the latter, do you have the right systems in place to enable their collaboration for the overall product success?
Choosing the right product team structure will affect your chances of building a successful product and delivering a positive customer experience.
The two decisions you need to make are who to bring on board and how to organize and coordinate their work.
If you want to see how Userpilot helps teams understand their customer needs, make informed product decisions, and track performance, book the demo!