3 Product Management Pro Tips from Phil Knight’s Entrepreneurial Journey

An entrepreneur can often find themselves with their hands in all parts of their startup. They can be heavily involved in development or engineering of the core product offering, especially if it’s their idea. They can be marketing trailblazers capable of selling their brand and vision as if they were their company’s unofficial mascot. Not to mention, early on they are usually delegated by default to the less adrenaline pumping functions of a business, like accounting, inventory management, and investor relations. Phil Knight’s journey to the top of athletic shoe Olympus didn’t begin because of his innate ability to design and manufacture the best shoe on the market. Phil Knight’s key attribute, which brought Nike from a company selling shoes out of the trunk of a green Plymouth Valiant to a company doing over 3.5 billion in annual revenue, was his ability to be an effective product manager. This article will highlight how Phil Knight’s entrepreneurial success stemmed from his execution on some core product management concepts.

1. Questioning Every Assumption

In 1962 Phil Knight was still an MBA student at Stanford. For what was just a research paper assignment during his final semester of classes at the time, Phil was tasked with finding and analyzing an opportunity in the market and to state his case as to why he believed the opportunity was pursuable. His choice: Why the running shoe market, which was currently dominated by Germany, was poised to be overtaken by Japan. Phil Knight’s motivation to conduct weeks of in-depth research was catalyzed by his motivation to receive a good grade (He got an A, of course). This motivated him to conduct proper due diligence on his hypothesis. Through weeks of research, he was able to test his idea on paper to determine whether there was a pursuable path to success. As product manager, no change to the product should go without strenuous tests to your core assumptions. Ideas based on assumptions have a much higher failure rate than ideas backed by metrics and data. This supporting research can come from existing industry data or competitor analysis. Other avenues of attaining metrics can ultimately drive your decision making. A product manager can directly reach out to current or potential users to seek their reactions to certain assumptions. It is important for a Product manager to have a diligent, continuous appetite for information, that can be analyzed, to set a course of action for their implementation strategy. If Phil neglected to test his hypothesis, he could have signed his first purchase order with Onitsuka, his original Japanese athletic shoe manufacturer, only to realize that there was no gap in the market to pursue. His initial 50-dollar investment, which was a lot of money for him and his family, would have been lost along with any prospects of growth.For the very same reason, companies may find themselves losing large sums of money if Product teams don’t work to reign in assumptions prior to implementation. Product Managers must have an expert understanding and maybe even a slight obsession with their company’s vision. They must then use metrics and data to determine how the decisions they make drive the product forward and maximize positive return on their company’s vision.

2. Empower Your Engineers and Subject Matter Experts

Phil Knight’s company, originally named Blue Ribbon and later Nike after its separation from Onitsuka, achieved success partly because of its obsession with delivering a superior athletic shoe. However, it wasn’t Phil Knight’s ideas about shoe improvements that delivered a competitive advantage over industry behemoths like Adidas and Puma. In this case he had a secret weapon – his cofounder and former track coach Bill Bowerman. Bowerman served as the de facto lead developer of new athletic show product offerings. He would spend many hours altering shoes in his Oregon home to improve traction, weight, and shape to maximize the shoe’s performance. A mad shoe scientist, Bill Bowerman would slice shoes and reconstruct them so that his University of Oregon track athletes would gain an advantage. This obsession was later monetized when Phil Knight made Bowerman his co-founder.But it was not just having the best engineer that made Phil Knight a great success. It was his specific managerial style as the controlling owner of his startup that made Bill Bowerman a lethal asset. Phil only set the vision for the company, “To win and not lose” and, then took a laissez-fair approach with his product development team of one. This resulted in enormous success. Bowerman introduced improvement after improvement through his meticulous iteration and volunteering his runners as lab rats for his sneakers. Phil was partially empowered by his favorite war general George S. Patton who famously said, “Don’t tell people how to do things, tell them what to do and let them surprise you with their results.”Nobody directly works for a product manager; product managers work alongside cross functional teams to execute on the product strategy. While the product manager has a lot of say when it comes to determining the goals, it would be unwise for them to tell members of other teams, such as engineers, how to do their job. Remember, engineers have been hired because they are great at doing just that, engineering. Empowering them to determine execution will lead to the inclusion of new approaches and a team them feels validated and respected for the work they do for the product. Product managers will instantly find that they are receiving a higher quality of work from the teams involved because everyone feels the common ownership of the goal – driving output towards the vision.If Phil Knight didn’t give others the freedom to do what they did best and contribute their talents towards the common goal then, Bill Bowerman may have never developed the legendary Tiger Cortez running shoes or the Nike Waffle Trainer.The same goes for Jeff Johnson, Nike’s famous first employee. Johnson served a myriad of job functions included running the first brick-and-mortar store, setting up east coast distribution, managing operations, and establishing manufacturing capabilities. In Johnson’s case, he pumped out one hand-written letter after another to Phil Knight constantly asking for advice, direction, and moral support. Johnson desperately wanted feedback and guidance, so Phil Knight had to actively work to not give Johnson step-by-step direction. He told Johnson what the big picture goal was and left the execution up to interpretation. The result is history. Johnson was fantastic in every role he served in Nike and Phil was able to optimize Johnson’s ability.

3. Building a Lean Mvp

Despite not having a dedicated product team or large product development budget like their competitors, Nike was able to churn innovative products that were desirable to the Market. Employing a lean approach to product development is what gave Nike its competitive advantage. Being lean allowed for mitigated development risk because money was never spent without validation from customers.The first step to a lean approach is to establish constant communications with potential customers/users. While you may think you have a fantastic idea for an improvement to a product, Product Managers should carefully work to gather enough information from their customers to validate market acceptance.The strong running background embedded in Nike was largely due to the people on the team. The company was able to leverage their experience and network to iterate upon new ideas because of this.When Phil was first selling his shoes, he threw his inventory in the trunk of his car and drove to every high school and college track meet he could get to. He used this time to sell his shoes but also learned many important lessons about the market. He learned what customers were currently using, what problems they had with the shoes he sold as well as his competitor’s shoes, and what was important to runners. This screams lean startup methodology. Phil was actively eliminating uncertainty because he was learning directly from his consumers. He was working smarter because he was including his target market in the idea generation process.The next large step after initial idea validation is to build a minimal viable product, often referred to as an MVP. Bowerman was able to iterate prototypes very quickly because of his builder mentality and his situation. He had many experienced runners who trusted him at his disposal. He would spend his free time building out these experimental shoes then placing them on his runners. He could then gather qualitative and quantitative feedback by testing the shoe’s performance on his pupils. This way no money was used for a production run of athletic shoes unless Bowerman fully believed based on his validation testing that the model added value.

What to Internalize at a High Level

Because an entrepreneur must have an entire walk-in closet of “hats” they must wear to support all the functions of a business, a correlation can be seen that successful entrepreneurs must be successful product managers. When you breathe life into a business, you are usually doing so because you believe you are delivering value. The road to the successful delivery of that value through a product or service can be studied by noticing what makes a product manager great at what they do and reapplying it.