The Narrowing Path: Navigating Product Leadership in 2025

6 critical challenges facing today's product leaders

The landscape of product leadership has undergone a profound transformation in recent years. Job openings for product managers at tech companies have contracted dramatically, now standing at only 60% of their 2022 peak, according to data from TrueUp shared in Lenny's newsletter. This contraction has created a challenging environment where competition for each leadership role has intensified, and the bar for entry into the leadership ranks has risen significantly.

But that only tells part of the story, as it only includes tech companies. There are many product leaders inside traditional enterprises. Based on my own experiences working with traditional enterprises, I would argue this number is growing as more traditional companies wake up to the value of product management for the software that enables their businesses.

Recent LinkedIn data reveals approximately 400,000 product leaders at the Director level and above across English-speaking profiles in the Americas and Europe. Among these leaders, 33% work at companies with more than 10,000 employees, while only 22% operate within the technology sector. And 37% of these product leaders work at companies experiencing modest growth of just 3-10%, highlighting the pressure many face to deliver results in constrained environments.

6 Critical Challenges Facing Today's Product Leaders

The challenges product leaders face today aren't merely temporary obstacles but fundamental shifts in how product leadership functions in modern organizations. Here are six that I see time and again.

1. The AI & Product Leadership Gaps

When we talk about AI and product leadership, it typically falls into two big areas.

The one that is most accessible to all is learning to use AI to improve productivity and work quality. This includes:

• using generative AI as a thought partner and writing coach in plans and communications

• using AI in product discovery for prototyping, feedback analysis, and research synthesis tools

• using agentic AI tools to automate tedium and scale capacity to execute repetitive tasks

The one that is harder to gain opportunities in is developing winning strategies for AI products themselves and successfully executing on those strategies with AI product teams. If you don’t have access to this yet, you can prepare by building your portfolio of case studies and projects.

2. The Expanded Leadership Mandate

As organizations flatten, product leaders now manage more direct reports with fewer advancement opportunities to offer their teams. Meanwhile, learning and development budgets have contracted precisely when the need for upskilling in areas like AI has become most acute, creating significant talent development challenges.

3. The Business Acumen Imperative

As someone who cut their teeth in startups, I hate having to describe this as something new. The truth is, there was an era where many product leaders didn't have to show impact and results the way they do today.

Financial fluency has become non-negotiable for product leaders. Gone are the days when a compelling vision could stand alone without a robust business case. Today's product leaders must speak the language of CFOs—understanding margins, EBITDA, ROI, and other financial metrics that translate product outcomes into business impact.

4. The Overreliance on Subject Matter Expertise

With the product management boom a few years ago, more people without true product management experience have been in hiring positions for product managers and product leaders. One way this typically manifests is in a false belief that what is needed is a leader from within the same sector. In B2B SaaS, where I've spent the majority of my career, FinTechs exec want to hire FinTech experts to lead product, MarTechs want to hire MarTechs experts, and so on.

I believe this is misguided, as truly great product leaders can generally ramp up in a new domain more quickly than a domain expert who has not been on a product team can overcome natural biases that product leaders have spent a decade or more learning how to counter.

5. The FAANG Preference Paradox

With all the Big Tech layoffs in recent years, there is an abundance of talent on the market with FAANG experience, and the gap between those with and without FAANG experience has accelerated in recent years.

This neglects to account for the different skill sets for product leaders in places without massive customer bases and experimentation infrastructure. Product leaders at B2B SaaS startups and traditional enterprises typically face different core challenges than those in Big Tech, and I've seen many an ex-FAANG leader flounder in these environments.

6. The Enterprise Reality Gap

For the 20% of product leaders working in financial services and traditional enterprise environments, the gap between theoretical best practices and organizational reality is strong. Political navigation is as crucial as product expertise, while difficulty with access to customers and infrastructure for experimentation often make "textbook" product discovery extremely difficult.

A Preview of Our Product Leadership Series

In the coming weeks, we'll explore each of these challenges in depth, offering practical strategies for navigating the evolving product leadership landscape. Our series will include:

• The AI Transformation Imperative: How product leaders can develop AI strategy expertise and effectively collaborate with data scientists and engineers

• Doing More With More Reports: How successful product leaders are navigating org flattening while delivering the results they need to succeed

• Learning to Speak Finance: How product leaders have learned to speak the language of the C-Suite and build buy-in with their peers

• Showing You Understood the Assignment: How product leaders are showing they have the subject matter chops to get the job done

• Advancing Without FAANG Credentials: Strategic approaches to career development for product leaders without big tech pedigrees

• Enterprise Reality vs. Product Leadership Ideal: How successful product leaders bridge the gap between theory and practice in complex organizational environments

Each article will draw on real-world examples and provide actionable insights. We'll examine how successful product leaders are adapting their approaches to thrive despite resource constraints, organizational complexity, and intense competition.

Join us in the weeks ahead as we explore the strategies and approaches that are helping product leaders thrive in 2025 and beyond.

And in the meantime, I'd love to add your insights to the articles if you’re a product leader either in-seat or on the hunt (or both).