How product teams can quarterback high-performing organizations to unlock value

When many think “agile” today, they think about the tactical aspects — small teams, two-week increments, big-room planning and so on. While these can be the building blocks for successfully adopting agile capabilities, many organizations unknowingly set these processes and tools as goals instead of means to an end of unlocking more significant value.

The next frontier is to organize around end-to-end products that can address the vast majority of customer experiences. Product-centric operating models reflect a product’s full life cycle and bring together customer preferences, business needs and technology to help deliver a product that its end users value. In this way, the future isn’t about functions or software development but the end-to-end customer experience.

Many companies chase “customer centricity” as a North Star, but few achieve it. How do those few do it? In short, becoming agile can help achieve client-centric outcomes and deliver end-to-end digital value transformation. In our experience with companies from diverse industries, of different sizes and with distinct cultures, those with effective product leadership can pave the way in getting speed and client-centric outcomes in efficient, effective delivery models.

Operating attributes of high-performing product models

High-performing companies have some common markers. Better outcomes come from persistent teams that focus on delivering value to stakeholders while working autonomously. They’re cross functional and composed of fully dedicated resources. Many leading organizations do this at scale and enable continuous delivery of high-quality client-centric products.

We believe the product team is the “quarterback” in these high performers. That’s because the key to success lies in the system of product management that the organization adopts. It’s not sufficient to craft a product team unless it has the right mix of talent and the product managers have the autonomy to act.

From idea to deployment — and beyond

A product-centric operating model reflects the full life cycle of a product and brings together customer experience, business needs and technology to provide a product that can deliver value for end users.

In helping clients implement product management models, we’ve identified seven key attributes of high-performing organizations.

• Persistent: Product areas are stable and focused on a consistent experience.
• Value focused: There’s profit and loss accountability with continuous measurement and focus on results.
• Autonomous: They operate with limited dependency on shared functions and governance.
• Cross-functional: Delivery teams, or “pods,” comprise all resources needed (sales, marketing, analytics, operations, design engineering, etc.) to help deliver discrete services or components.
• Dedicated: Delivery resources are dedicated and committed with teams that don’t move around.
• Product scale: Consistent product roles are applied and scaled all the way to a chief product officer (CPO). These roles are applied at team, team of teams and portfolio levels.
• Continuous: They constantly collect client feedback and prioritize, deliver and measure results.

Building the product-centric model from the ground up

In one example of product teams leading the way, a US financial services company realized it wasn’t growing as fast as industry leaders and wanted to reinvent itself. Transforming the product organization required extensive buy-in from leaders in parallel with business unit level mobilization. Chief product officers were identified for each business with authority and accountability for investments, persistent product funding and control over the product roadmap.

Through this, product took center stage, and the product team led in every instance. This product team took input from distribution channels, which implemented changes and worked with partners in IT, marketing, compliance and risk to deliver the end result. The focus was on creating smaller, empowered teams with massive accountability for the outcome.

New job specifications for the product function — including head of product, product lead, senior product manager, product manager — each supported a different level of the product hierarchy and required different proficiency levels across each capability. Together they developed the product, aligned the channels and owned the go-to-market strategy and analytics to help deliver the end product. Many of the teams reported that working in the new way was significantly better than past practice. The result was accelerated performance that outpaced their direct peer set.

How product management can help modernize a workforce

In another example, a multinational retail company wanted to modernize its operating model and continuous delivery pipeline while helping drive more innovation into technology and the business overall. Three previous attempts to effectively transition to agile were unsuccessful, and the company’s old ways of working prevented it from attracting new talent and being more competitive. In addition, IT remained siloed from the business and fulfillment of business requests was constantly delayed and over budget.

The operating model redesign centered around customer- and product-centric ways of working while standardizing and scaling agile principles, governance, standards and practices.

• Analysis helped identify the logical breakdown of operational value streams and their supporting technology product taxonomies.
• Value streams were aligned to portfolios to manage related business capabilities and outcomes with a focus on internal and external customer value realization.
• Standardized playbooks, consistent training, dedicated coaching and progressive phases helped enable the activation approach.
• The product management function was formalized to support the value streams, which resulted in forming formal product manager and product owner jobs.

These actions established a new operating model and a culture based on the principles of operating excellence, transparency and alignment, end-to-end accountability, high-speed delivery, an adaptive workforce, and scalability, automation and standardization. The company achieved a 70% decrease in defects, and bringing development and test team members together into a single pod improved cycle time by 40% and reduced rework. Organization silos were broken with over 50 business-sponsored product managers dedicated to value streams, and one of every five sprints focused on innovation. The effort upskilled several thousand employees in new technologies through over 20 technical learning plans and also led to a 25% year-over-year increase in employee satisfaction.

Commitment to product agility is key to achieving results

Companies that don’t embrace the full set of product management attributes can run the risk of becoming irrelevant quickly. And you can’t be half agile — merely adopting the terminology or changing at some levels but not all. Real results require real commitment, and top leadership needs to align and lean in.

The highest performance change requires pulling multiple levers — organization, talent, ways of working, technology enablement and financial management processes. Here’s how to start.

• Restructure your business around product-centric, autonomous teams with a clear hierarchy.
• Develop a talent strategy that can attract and retain skilled talent and upskills existing employees.
• Adopt agile methodologies, implement continuous delivery and foster collaboration.
• Invest in tools that can support agile product development and management.
• Align budgeting and value measurement with product-centric models, focusing on product value and customer outcomes.

By holistically addressing these areas, you can create an environment conducive to high-performing product management. That in turn can help drive better business outcomes and transformation that is deep rooted and sustainable, leading to long-term success in a rapidly changing business landscape.