Walk me through a time when you have had to say "no" to an important client.

Remember to provide business-driven justification for your decision. For example, a product manager might say no to a client who requests a feature that would cost more money than their budget can allow.

"In my current role as a product manager, I am responsible for an asset management system that one of my senior-level users really disliked. He went out on his own and reached out to several vendors regarding replacement possibilities. He came to me one day with information on a vendor he was certain we should move to and asked me to begin contract negotiations. He indicated he had already discussed it with the executives in his area and he had their buy-in to move forward.

Unfortunately, this client was new to the company and had little insight into our processes or the technology roadmaps for his area. He did not understand the difference between SaaS and solutions and on-premises solutions. He did not understand which portions of the solution were provided by the vendor and which portions were additions and customizations we had built ourselves. He did not have an understanding of the level of integration the system had with various other systems we used. He did not understand how system support and maintenance worked.

I let him know that I really appreciated his enthusiasm for finding a better solution, but that we needed to take a step back and look at the big picture together before moving forward. I asked him to articulate the reasons why he felt we needed to move away from the current solution and to describe the new features he was looking for in a replacement solution. I then took the time to walk him through the business model and finances for the current solution. I also showed him a context diagram that explained the total user population and the integration model at a high level. It became very clear to him that replacing the current solution was not as easy as just selecting a new asset management system for his team.

I then walked through the gaps that he highlighted as the most significant to him. We collaborated on some adjustments and new features that would help to improve the experience of the team he was responsible for. A few items were quick-hit configuration adjustments I was able to implement within days. I worked the other changes into the product backlog based on their relative value to the other top priority work we already had scheduled.

The situation worked out well in the end. He was able to gain an understanding of an area of operations within our company that he was previously unaware of. He also appreciated the time I took to listen and the work I did to make changes that had a positive impact on his area of responsibility. I asked him to join the steering committee I regularly facilitated and he proved to be a huge asset to the group."