What Are The Benefits Of Running Your Software Organization As A Business That Delivers Products?

In my blog post yesterday, I asked whether you should be running your software organization as a business that delivers products. Today I will explore what it means for you to take this approach.

As Forrester has pointed out in past research, to move forward in a product-centric way, you must establish a number of capabilities in your organization in a product-centric operating model:

I used to make a living doing product management and running product management organizations, as did a number of people at Forrester. My perspective on product management is somewhat distinct because I started out on the product engineering side, leading product development organizations. But between my first ISV and my second, I saw the contrast between weak, ineffective product management and strong, effective product management. When strong product management is in balance with an effective engineering group, well aligned, it’s a beautiful thing to see. The weak option? You don’t want to know – it was too painful to remember.

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Should You Be Running Your Software Organization Like A Business That Delivers Products?

Is it hard to focus your software delivery organization on the right things? Do you sometimes deliver the wrong features or give too little priority to the most important features? Are you drowning in the cost of too much redundant software, because stakeholders can’t get on one page about what the business really needs? Do you struggle to make the case for investments you know are essential to your long-term survival but that deliver few short-term benefits? If so, consider the benefits of running your shop more like a business by reorganizing to deliver products (or value streams, in Lean lingo).

It’s been more than two years since we last surveyed software delivery leaders about their increasing tendency to organize to deliver software as products (rather than projects or application functional areas), but even then this trend was well under way:

I have only anecdotal evidence that this trend is continuing to grow, but I’m convinced by hundreds of interactions with top software delivery leaders since we did this survey that it is, especially for people who deliver customer-facing websites and mobile apps. Customer-facing dynamics are also driving this trend for the “Internet of things” among firms focused on Smart Grid and other similar domains that depend on customer adoption to drive success. What are the factors driving this growth?

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