Product-driven businesses

Leaders and boards who require their businesses to succeed in the digital transformation, need to realize that product managers plays a vital […]

Leaders and boards who require their businesses to succeed in the digital transformation, need to realize that product managers plays a vital role.

In the early days of programming, products were often developed in a collaboration between managers requesting a product and software developers – often an IT-department. A large amount of resources were involved in defining the design requirements for what was about to be made. As a consequence, the developments were defined by step-by-step processes and waterfall methodology. In these early days, the people in power of product design were naturally those requesting the product. The IT-department, or software developers, did as they were told. Their work was organized as a project and reviewed by others.

But with the development of web-based software, it became obvious that the approach had several issues. The methodology was neither successful or effective. And with the development of app-based software and time-to-market practices, the issues became even clearer.

Today, in a world where digital is the norm, the old methodology for product development is insufficient. Unfortunately, this realization is not common. The need for new processes is overlooked by many norwegian companies. At the same time, big technology platforms such as Google and Facebook take the lead.

The new methodology defines the user experience as the core of product development. In the following bullet points I will describe shortly how the new process works:

• In order to define valuable design requirements for products, the business must rely on user knowledge and data analysis, not merely listening to those requesting the product inside the company. This means changing the way teams are organized and the delegation of tasks.

• A team should be organized by a product manager, and the product manager must be the leader of the process when innovating new products. In other words, the product manager acts as the CEO of the product and is responsible for the entire process from making analysis of business potential and market value, to developing business models and product strategies.

• A team of engineers defines the product solution and is given power to take product decisions, such as software tools, architecture and coding. If the business produces a new product, the team will often have few engineers. The number of resources increases for mature products with a clear definition of what is about to be made.

• The last function in a team is UX (user experience). This function analyzes how users respond to the product solutions at different stages, and uphold user dialogues.

• A business who puts the product manager first and organize user experience (UX) as an independent business area, will scale new products more effectively and give more power to the core of product development; the user experience. This organizational structure is used by mange big technology platforms.

• In addition to organizational changes, technology platforms have also defined new ways of launching products. It is normal to produce a minimum viable product (MVP), and then closely analyze user data to gain insight on how the product is actually being used. These data are used to optimize the product continuously. This new way of working results in several adjustments, iteration of the product, as opposed to the earlier step-by-step processes where the intention was to design a final product before programming it.

The new methodology is fundamental to efficient and modern product development. The organizational changes have also resulted in new and specialized professions, such as product managers and UX-designers. As a consequence, specialized and complex academic fields are emerging – especially in the USA. Thus, big technology platforms such as Google and Facebook have accessed the best engineers from the best universities. Unfortunately, the new educational disciplines has so far had a limited scope in Norway and Europe. This is a challenge for norwegian and european businesses, and it is neither helping that the working conditions offered by the technology platforms, especially salary, is way beyond what others can offer.

The biggest difference between the old and new process of product development is the role of the product manager. The new methodology requires that product managers are given organizational power and impact.

The early days of IT-departments doing merely as they are told without involvement are over. It is time that boards and management teams in Norwegian businesses acknowledge the value of product managers and UX-design.

This article is written by Terje Seljeseth, Chief Analyst at the Tinius Trust.