Hiring a product manager is usually a lot more difficult than other roles because of the nature of their job. Product managers possess a mix of soft and hard skills that they usually need to match with their domain expertise (or the industry they know better).

They need to be creative but able to negotiate with multiple stakeholders, and they need to be to talk to software engineers while also explaining their decisions to C-levels. This is the mix of skills that makes this position difficult to fill and even more difficult to test.

Hiring product managers is a good example of where a skills-based approach can deliver more results than the classic screening based on what the person has done before.

Let me dive deep with this article on how to hire a product manager starting from their skills – I am going to use our Job Simulations as the tool to assess the skills of a PM. You could consider other solutions as well, starting from simple assignments that bring your candidates to demonstrate their skills.

Before we start, what are the advantages of using a skills-based approach for hiring?

As we have already outlined in previous articles, traditional hiring methods often prioritize qualifications and experience over skills, leading to candidates being hired based on their credentials rather than their ability to perform the job.

However, this approach does not always guarantee success because, in today’s world of work, credentials do not take into account the candidate’s specific personal competencies, his or her experience and skills gained on the job, his or her ambitions, and professional goals.

By shifting the focus to skills instead, companies can ensure they are selecting candidates who possess the specific competencies needed to succeed in the role. One of the key advantages of designing a skills-based hiring process is just that it allows for a more objective evaluation of candidates. Rather than relying solely on subjective opinions or gut instincts, hiring managers can assess applicants based on their ability to perform specific tasks and meet certain criteria. This helps to reduce bias and ensures that the hiring process is fair and transparent.

Furthermore, hiring based on skills can lead to a more diverse and inclusive workforce. By valuing skills over traditional qualifications, companies open up opportunities for individuals from different backgrounds and experiences to succeed, and this not only promotes diversity and inclusion within the organization but also enables the company to benefit from a range of perspectives and approaches.

When companies prioritize skills in their hiring process, they are able to identify candidates who have the necessary abilities to perform the job effectively, meaning that they can save time and resources that would otherwise be spent on training new hires.

A skill-based hiring approach to recruiting product managers

A product manager is responsible for leading the development and success of a product, from ideation to launch and beyond. By definition, he wears multiple hats and his unique goal is to make his product succeed by working with a variety of stakeholders while taking care of all sorts of constraints. While we usually think of product managers in the context of digital products and services, today there are millions of companies hiring product managers to “rethink” their products and services adding digital components to them. Tech-enabled companies are usually the ones that need product managers to help them craft new digital experiences on an existing business model and product.

A great product manager is usually the result of years of experience building different types of products, services, and processes (and most times working with titles that you wouldn’t think would be close to the skills of a PM, e.g. digital marketing manager) and learning a variety of soft skills that allow him to navigate conflicts, persuade people and align teams across common goals. It’s a large mix of skills that you can find in several roles: that’s why using skills to hire product managers works well. Because if you were to look for just people that are product managers today, you would miss 50% or more of the potential candidates.

Now, the reality is that great product managers, with experience, are rare. Most companies struggle to find product managers that have done the exact same job before and therefore the solution is usually to hire people that have the exact same skills but did not have that role / title up until now.

Years ago I’ve reached out to a potential product manager reading a few of his answers in a technical conversation. His title was not product manager but his ability to describe the problem and a potential solution was enough to convince me he could have done the job. We hired him a few months later!

Now, let’s see how to use skills to find your product managers:

Identifying the key skills for product managers

Before implementing a skills-based hiring approach to recruit key a job function like a product manager, it is crucial to identify the skills required for him or her to have success in the role.

This largely depend on what kind of product manager best fits the needs of the organization, but the whole skills identification process can be done by analyzing the specific responsibilities and requirements of the role and consulting with current product managers to determine the skills they believe are most important for success within the company.

Some of the key competencies commonly sought after in product managers include:

• Strong communication and interpersonal skills
• Strategic thinking and problem-solving abilities
• Product development and lifecycle management
• Technical knowledge and understanding
• Data analysis and decision-making
• General business knowledge and ability to understand unit economics

These are examples, my suggestion is to spend a bit more time looking at your industry and products/services to add more details to this. If your product needs to be sold through partners – for example – that’s something that gives you more skills to look for (e.g. ability to interview customers and partners).

For readers interested in shifting to product management, I wrote an article about how to become a product manager covering also the main specific skills that can help along the way.

Creating a skills matrix for evaluating product manager candidates

Once the key skills have been identified, the next step is to develop a skills matrix that can be used to assess product manager candidates effectively. A skills matrix is a visual tool that allows hiring managers to evaluate candidates’ proficiency in each required skill.

When creating a skills matrix, it is important to break down each skill into specific components or subskills. This provides a more granular evaluation and enables hiring managers to assess candidates’ strengths and weaknesses in each area. It is also helpful to assign different levels of proficiency to each skill, such as beginner, intermediate, and advanced.

During the interview process, hiring managers can use the skills matrix as a guide to ask targeted interview questions that assess candidates’ competency in each skill. This helps to ensure a comprehensive evaluation and provides a clear picture of each candidate’s skills and qualifications, but it is always essential to tailor the skills matrix in a way that aligns with the organization’s specific needs and goals.

Incorporating skills assessment and job simulations in the hiring process

In addition to interviews, incorporating skills assessments and job simulations is the secret weapon to speed-up and enhance the skills-based hiring process. Job Simulations is a unique technology we have created that brings people into a real scenario – with multiple actors powered by AI – and let candidates work with them to complete a specific challenge. It’s particularly good for roles like product managers because it requires the use of both soft and hard skills to succeed.

For product manager candidates, mapping and assessing skills could involve analyzing a product’s lifecycle and presenting a strategic plan for its development and launch. This allows hiring managers to see candidates in action and evaluate their ability to apply their skills to real-world scenarios. These range from customer service dilemmas to teamwork in new projects. The candidate assumes a role within the simulation, solving challenges and interacting with others, using both soft and hard skills. This allows our software to analyse all interactions between the candidate and other actors in the simulation, providing insights into how the candidate managed specific conversations and highlighting whether he or she can represent or not a good fit for the company in cultural terms.

In order to complete each simulation, candidates need to prove they can interact with customers and stakeholders to identify problems and use data to build specific software features to solve them. Prerequisites for job simulations designed to assess product manager candidates are usually knowledge of product management fundamentals, previous experience as a product manager, project manager or software engineer and a good understanding of software engineering principles.

An example of our Job Simulations for Product Manager – the candidate is involved in a real conversation with a customer that has feedback about the software he needs to work on.

If you don’t want to use something like Job Simulations, you can still apply a similar manual process and ask your product manager candidates to complete an assignment that forces them to show their soft and hard skills: in the past we asked our candidates to solve a specific business problem coming up with a proposal or we simply asked them to analyze the way we have solved an existing problem highlighting what was working or not. Testing their soft skills is more difficult without Job Simulations, so I would suggest to spend quite a bit of time letting your people talk to the candidates and see how they think, interact and negotiate with them.

Measuring the success of the skills based hiring methodology

Once candidates have been hired using the skills-based approach, it is important to measure the success of this methodology. This can be done by tracking various metrics, such as employee performance, retention rates, turnover reduction and team satisfaction.

If the skills-based approach proves successful to hire product managers, organizations may see an improvement in the overall performance of the product department (as individuals are selected based on their ability to perform the job effectively) and retention rates of PMs may increase, as candidates who possess the required skills are more likely to be satisfied and fulfilled in their roles. Not only that, hiring with a skills-based approach is the best way to find candidates that are diverse compared to the rest of your organization: you will likely find product managers that are different from your current ones in terms of their experience, previous roles and industry. Especially for such a role, this is incredibly valuable. They will bring to the team a new way of looking at problems and thinking about solutions.

It is also essential to gather feedback from hiring managers and candidates to continually refine and improve the skills-based hiring process. By listening to their experiences, businesses can adapt, identify any areas for improvement and make all the necessary adjustments in order to re-iterate.

Conclusion

The product manager case is just an example, you can apply it to multiple roles across the organization and get similar results.

By focusing on specific skills rather than credentials, companies can ensure they hire the most qualified candidates who have the necessary competencies to excel in their roles. For product manager roles this is particularly critical, since the common competencies required for this positions are often depending a lot on the specific needs of the organization.