Saturday, December 22nd, 2007


I came across this post in one of the product management forums and also read about it in www.svpg.com. Thought, I will have this information shared in my blog as well.

Does anyone know of ratios of employees in a product development organization? This is related to the ratios on product managers to engineers to QA to UI designers to architects etc.

Beyone of course, saying that it will always depend on a variety of factors, here’s what Marty Cagan of SVPG has to say:

Engineers: One Product Manager for every 6-10 Engineers

Designers: Think 1:4:8, where one visual designer supports 4 interaction designers, and each interaction designer supports 2 product managers

Architects: It would be 1 architect for every 5-15 developers. The lower-end would be 1 architect to 5 developers, typically for new product development that require hands-on architecture and the higher-end would be 1 architect to 15 developers, typically for ongoing management or developing more stable or legacy technologies.

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Product Engineering is not viewed as basic knowledge in Computer Science and Software Engineering Curricula. This still has not received the importance that it deserves. In contract, design in other engineering principles, is centered on product engineering, systematically engineering in desired qualities through successive stages of development.

Towards backing the importance of product engineering, companies like Aspire, where I work is looking at evolving a Product Engineering forum (http://producteering.org) where you can contribute and deeply work towards the concept of product engineering.

Your product development effort has been outsourced to an OPD vendor. You think you have strict project management controls and disciplined measurement and reporting of metrics. After all, you have many Gantt charts, graphs, dashboards, and health indices to prove it. Yet your product development is in deep trouble and this scenario is more common than you might imagine. The question to ask is if you are measuring the right things?

Managing an OPD effort is different from managing an in-house effort as you are dealing with another entity whose objectives are different from yours. Even if it is your own captive facility, their objectives may not be the same as yours, and it gets complicated further that their customers happen to be internal people. Defining a proper set of metrics is a great place to start to make OPD a success. People who are best in doing it are the vendors who have expertise in doing it for multiple customers of theirs. This, in turn, can act as a roadmap for continually improving the collaborative effort between the customer and the vendor.

The more I think about this acquisition, more than excitement, it strikes me that yet another pure play company is gobbled up by a major. The deal is a perfectly timed one for WebEx though at $3.2 billion and it opens up options for Cisco. There is already a bunch of startups that provide cheaper and flexible alternatives like teamslide, dimdim, 1videoconference that are competitive with WebEx and are better at cross platform collaboration. Probably a year down the line would have been stretching it too much for webex to have had this kind of valuation, for a company that posted a profit of $50 million in 2006. 

I am happy about the fact that WebEx was not acquired by one of these Private Equity funds that would have jacked up the valuation within a couple of quarters and probably made a 100% return on it.  

Enterprise communications market is growing rapidly, and companies like Cisco do not have time as a luxury to develop their own offerings. Right or wrong, this is the rationale that is driving many acquisitions, and WebEx is a case in point. Cisco already has a collaboration offering called MeetingPlace, which works on-premise for large corporations. WebEx fits perfectly for their unified communications offerings for SMBs. This service also complements Linksys one hosted VoIP and SmartBusiness Communication offerings for SMBs, that have not disturbed their profitability much.

Now the stage is set on the collaboration front, with WebEx leading the pack, Microsoft’s Live Meeting a slightly distant second (result of the acquisition of Placeware in 2003 and been pushed from the market leader position to second in these four years) and Citrix’s GoToMeeting a very distant third. This probably would be a great acquisition candidate for companies like Siemens and Avaya.

Effectively, most pure play companies will get acquired by bigger companies and consolidation will keep happening at all segments and at all levels. These acquisitions are probably one of the reasons that entrepreneurship still thrives and will continue to thrive.