Why do so many Product Centricity transformations fail ?
“How to turn my company into a product centric one ?“ is one of the question I get asked the most often. The good news is that people, and notably CEOs, become more and more aware of the criticality of product centricity. The bad news is most attempts fail.
Here is how it usually ends up: on one hand the CEO states that their company is not suited for being product centric (as opposed to FANGs), and on the other hand the (freshly resigned) CPO complains their CEO doesn’t have the “Product” mindset.
Are CEOs against Product Centricity? Of course not! Do they really understand what it takes to be Product Centric for real? Perhaps they don’t.
But what about CPOs? Are they too dogmatic? Even if they don’t aim at, perhaps they are. In all cases, CPOs need to reflect and wonder why it is that their CEO did not “buy” their transformation instead of blaming them.
A simple framework to succeed in your transformation
I would like to be able to pay tribute to the one who set up this very simple yet extremely powerful framework, but I don’t know the author. Personally, I discovered it during a workshop (that had nothing to do with Product) with a coaching practice called Trajectives.
I only realized in hindsight how helpful it could also be as regards to Product Centricity Transformation or any transformations for that matter.
As every transformation, implementing Product Centricity will take you from a Current State (in general not enough Product Centricity) to a Desired State (a Product Centric Company).
A key success factor is first to align every one on the Desired State (where do we want to go) but also on the Current State (where do we start from). Only then can you start talking about Tactics to move from state to another.
Now, keeping this framework in mind, let’s first try to understand why do so many transformations fail…
Why do so many Product Centricity transformations fail ?
Too often Product Leaders and CEOs skip the alignment step. No one really cares about the “Current state” because they just want to get rid of it and everyone thinks the “Desired State” is obvious.
So they start with implementing tactics taken from a famous Product Centric company’s playbook whose context has nothing to do with their own (let’s say, totally randomly, Spotify). By doing so, they miss the principles that lie behind this particular playbook.
It usually ends up in chaos, because the “Tactics” (eg. creating product squads, implementing PM roles, doing more user interviews…) they choose to implement often miss the real problems they are trying to solve (but they probably don’t event really know the real problems they face since they skipped the “Current State” diagnosis, see after for examples).
The absence of clearly defined and shared principles also leave the room for everyone to fill in the blanks with their own principles. And of course, the probability they match with others’ principles is almost zero.
Once everyone starts realizing tactics don’t work as expected, conflicts appear.
The transformation fails, and the CEO finally jumps into one of the following conclusions :
- Our company is not fitted for Product Centricity
- Product Centricity is a myth that only works in GAFAs
- We lack the right talents to support a Product Centricity transformation (especially the right CPO 😇)
Step 1: Aligning on the Current State
1.1 Understand “Why” Product Centricity is on your CEO’s agenda
You have just been hired by your CEO to turn the company into a Product Centric company or to strengthen a burgeoning culture. In your mind, this objective is very clear. You have tactics to implement, and above all, great reasons to justify the changes to come among the key stakeholders.
Let’s play a game : write the reasons and tactics on a sheet of paper. Now, ask your CEO to write down their own reasons and some tactics they also have in mind. What is the probability that your lists be the same ? Very low.
Let’s see two examples that might highlight some discrepancies :
(i) Your CEO might have been pressed by their investors to operate such a change without knowing what it really means. They had discussions with some peers about Product Centricity and now think every thing is clear. You better start discussing it with them, especially before joining the company.
(ii) Speeding up the tech delivery in the company might also be the reason why your CEO decided to move into a Product Centricity organisation. Creating product teams working in agile mode (which in fact has little to do with Product Centricity) might be one of the tactics they have in mind to do such a thing. Again if you don’t align precisely, your confirmation biais will only make you recall “Product Teams” from your discussions. These are familiar concepts to you, so you will move forward.
Why these discrepancies are so frequent ? Because for both the CEO and the Product leader, Product Centricity is so obvious in their mind that it is hard for them to figure out that it can be different for others (#empathy).
Understanding the Why is a good starting point but is not enough.
1.2 Validate a shared diagnosis about the Current State
Why is it so important to take time to understand where you start from as a company? Because a wrong diagnosis will lead you to implement wrong tactics. The absence of diagnosis will lead to anyone having their own diagnosis in mind and therefore conflicting views of their own.
Let’s take an example that I often hear from CEOs: “the tech delivery has become extremely slow. It takes us months to ship features that took weeks at the beginning”. Without working on a complete diagnosis, you might implement wrong tactics to solve this issue : hiring more developers, fostering agile through coaches, creating product teams…
What you really need to do is finding the root cause behind this problem. You can use the 5 Why’s :
- Why tech delivery has slowed down ? Perhaps because there are more bugs in every sprint, slowing down the velocity…
- Why do we have more bugs ? Perhaps because we develop too much features, preventing the tech team to ship quality code because of the delivery pressure…
- Why do we develop too much features ? Perhaps because we need to ship 10 features to have at least one that succeeds…
- Why do we need to ship 10 features to have at least one successful ? Perhaps because we don’t really understand the needs of our users
- Why don’t we understand the needs of our users ? Perhaps because no one in the company really talks (or better: listens) to them…
Perhaps the final root cause might be the lack of Discovery within the company, which Product Centricity could solve (but not Agile).
1.3 Keep in mind what Kinds of CEO is your CEO as regards to Product Centricity (context)
Again, every context is specific and you need to understand it before moving on your transformation otherwise you will fail… Is your company growing very fast? What is the size of your company ? Does your company have a tech culture? Or a sales culture? What is the level of trust between business and tech?
Without knowing these elements, you can’t take good decisions and implement the right tactics. As this article deals with the relation between a Product Leader and their CEO, you should above all spend time understanding the profile of your CEO, because most of the time the company culture is a mirror of the CEO profile. Here are some examples of CEO profiles :
- Command and control: think they know exactly what (feature) to do
- Sales driven: consider Product and Tech as pure enablers
- Product fooled: think they know about product but doesn’t
- Product obsessed: validate every Product decision, no delegation of trust or empowerment
Step 2 : Aligning on the Desired State
Now you agreed on the Current State, it’s time to move on the Desired State to ensure you all want to go to the same destination.
2.1 Define a common vocabulary around Product Centricity for the company
Words matter, so a first step might be to define the vocabulary related to Product Centricity. Again, the goal is to create a shared frame of reference, even if anyone does not fully agree. You will keep using the same words again and again during the transition (that may last for months), so you better be aligned on what they mean.
The “Product Pyramid” framework explained in this article might be very useful and should ease discussions between stakeholders.
- Mission (and Principles) are at the top of the pyramid. If your company doesn’t have a clear mission and principles, focus on defining them.
- Context is the second level of the pyramid. Every company has a specific context even if it evolves in a common space that other competitors. For instance Zalando is an e-commerce company but “shoes” are very different from “groceries” within the e-commerce space.
- Needs are related to the context. In Zalando’s context, a need might be “easy returns” while in a grocery e-commerce company, “delivery speed” might be a need.
- Problems are related to a need, they can be seen as opportunities for the company. For instance, as regards to the “returns” need, cost can be a problem for the customer. If you were in DIY e-commerce, convenience could be a problem (for instance if you ordered a very heavy item that you needed to return…).
- Solution is the final step. A solution is the answer to a problem, for instance “free returns”, “home pick-up” or “don’t pay your article if you return it”.
Unfortunately, companies often start with the solution, opening the doors to endless conflicts because every one is convinced to have the best solution. By having made these concepts clear to the whole organization, you drastically reduce the probability of conflict.
2.2 Explain the activities that will enable Product Centricity
Product Centricity’s activities will be easier to shape once a common vocabulary has been defined. For instance (this is my definition, but you might adapt it given your context), Product Centricity’s role is to ship the right solutions to answer your (sometimes unexpressed) customer’s needs. To do that, you mainly follow these three activities (credit to Marty Cagan who defined these very simple activities that best represent the range of Product Centric activities) :
- Discovery: perfectly understanding the needs of your users in the context in which you operate.
- Strategy: once the needs are clear, you have to prioritize the solutions you will develop because, remember, tech resources are not enough to build every idea you have.
- Delivery: once what you need to do is clear, you just need to deliver these features in time and quality
Unfortunately too many companies focus almost exclusively on delivery. And shipping the wrong features faster won’t help. Having this alignment about Product activities can bring about a great opportunity to question your CEO about their potential delivery tropism.
How not to turn such a discussion into a passive-aggressive situation ? You could try “We relased X features last quarter, the dev team did well and we can be proud of it. In the same time, how much did these features impact our users? Which behaviors of our users did they promote / change / mitigate? We would need time to investigate before releasing new features, otherwise I am afraid we’d be wasting our resources… Why not give the tech team the opportunity to clean the codebase in the meantime?”
2.3 Agree on the role of Product Centricity Agents (aka Product Managers) and the principles
Again, you better agree with your CEO on what they expect from your (potentially future) Product Managers. For instance, you better realize upfront that the CEO expected experienced a Project Manager to write specifications for developers (which is fine but has little to do with Product Centricity). At least you have a chance of making the case for the roles Product Managers should have in the company in a Desired State.
It’s hard to summarize what is the role of a Product Manager but a metaphor is always worth hundreds of words. I would start by stating that a Product Manager cuts leaves in a tree… The tree is the Problem Space (and Product Manager should spend long hours to frame it well) and the solutions are the leaves. You potentially have dozens of leaves, some are technically complicated, others don’t bring enough values to the users… And you can only keep one or two leaves maximum.
The Product Manager is not the one who will make the call alone, he just helps the rest of the product team make a decision. So you need a great deal of collaboration for Product Centricity to work in the company. Again, you better discuss it upfront along with other principles that will ease Product Centricity work (small and autonomous teams, empowerment…)
Step 3: Start implementing changes
Now you are aligned with your CEO on where you start from (Current State) and where you want to go (Desired State), it’s finally time to jump into the Tactics: how to move from the Current to the Desired state.
3.1 Make it progressive
If you want to succeed in your transformation, don’t go too fast. The time it takes to turn the company is not your success metric, as opposed to the behaviors you changed for good within the company.
You’d better start by making the case on a limited scope. By limited scope, here are some examples :
- Most motivated people: you will always find some people in the company willing to embrace Product Centricity, for instance people having experienced working in a real Product company. Find them and start with them.
- Customer facing teams: starting with very technical teams would be a mistake as sometimes, a Project Management style might do the job pretty well. Besides it might undermine the most motivated PMs.
- Low hanging fruit: start with the team for which you see the highest potential based on your experience or your first discovery efforts.
Do your best to help the team succeed by coaching and supporting them in this new way of doing if necessary. Facilitate relations when needed with external stakeholders.
Once the case has been made, you will be able to build much more easily on it. You will be able to rely on other people than you to support the product centricity move. Avoid at all cost a “top down” approach like “tomorrow, all teams will start working in product teams and scrum”. You would just nurture resisting behaviors. Instead, let people who experienced the benefits spread the words within the company. Get other leaders come and see how the team works and the results it achieved.
3.2 Make clear what role the CEO could play to ease product centricity
Again, your CEO will play a critical role in this transformation. You don’t want them to play one of the role already mentioned in the previous paragraph (like urging everyone to change overnight). By explaining them what they can do to really help, you increase the probability of success of your transformation. Here are some examples of behaviors it would be nice they demonstrate:
- Challenging the teams on outcomes, not outputs (”what impact did you have over the last weeks” against “how many features did you ship”)
- Focusing the company on a very limited set of objectives so that PMs and teams can prioritize on their own without resorting to the CEO at the very end (#empowerment)
- Fostering collaboration by not praising/blaming only the PM if things go right/wrong, instead favoring always product teams overs individuals and business units
Conclusion
That’s all! Feel free to share your journey through the comments, it might help others! You can also read the ManoMano journey towards a more Product Centric company.
Here is the wrap-up to succeed in your Product-centric transformation
Step 1: Aligning on the Current State
- Understand “Why” Product Centricity is on your CEO’s agenda
- Validate a shared diagnosis about the Current State
- Keep in mind what Kinds of CEO is your CEO as regards to Product Centricity
Step 2 : Aligning on the Desired State
- Define a common vocabulary around Product Centricity for the company
- Explain the activities that will enable Product Centricity
- Agree on the role of Product Centricity Agents (aka Product Managers) and the principles
Step 3 : Start implementing changes
- Make it progressive
- Make clear what role the CEO could play to ease product centricity
Hope it helped !
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