How Do You Know If Your Product Org is Ready for a Transformation?

You are thinking it may be time for a full product transformation, but how do you know for sure your organization is ready?

If you’re a Product Manager who has been around for a while, chances are you’ve heard of Silicon Valley Product Group (SVPG). Their focus on how to build great products and teams has gained them a lot of notoriety in the tech industry. We had the opportunity to spend some time with them in NYC a few months ago, and we are sharing our findings about product transformations and when they’re necessary.

How to Know if Your Organization is Ready for a Product Transformation

First things first, how do you know when your organization needs a product transformation? The answer is often well before anyone admits that they’re ready. It’s important to recognize that change is necessary to keep up with technology and customer needs. However, change can be hard, and it’s often easier to keep doing what you’ve been doing than to undergo a transformation. "We have just always done it this way!"

So, what are the signs that your organization is ready for a product transformation? The first key indicator is when top leadership is ready. Without their support, a product transformation is unlikely to succeed. It’s important to remember that these types of transformations often sprawl beyond just the product organization, so buy-in from leadership across the organization is essential to success. 

Another key indicator that it’s time for a product transformation is recognizing that what has worked in the past won’t necessarily work in the future. Technology and customer needs are constantly changing, and organizations that don’t keep up risk becoming irrelevant. We talk in our Achieving Product Market Fit course about your company's level of fragility. Where is your company in being prepared to handle the changes that come their way from external forces?

One common misconception is that a product transformation has to be driven by an external threat, such as a competitor disrupting the market. While external threats can be a motivator, a successful product transformation should be driven by internal motivation to improve and stay ahead of the curve. Because you care about solving your customer's problems. And if you have been staying on top of customer discovery, you know your customers better than anyone else!

So, if you’ve recognized that it’s time for a product transformation, what’s next?

The SVPG team recommends starting with a deep dive into your current processes and identifying areas for improvement. This includes understanding how your teams fund, discover, and deliver products.

One key area of focus should be funding. Traditional funding models, such as project-based funding, can lead to a focus on short-term goals rather than long-term strategy. A more effective approach is to move towards product-based funding, which focuses on funding a product team and allowing them to focus on long-term strategy and building a successful product.

Another important area to evaluate is how your teams discover and validate ideas. Traditional approaches, such as relying on the HiPPO (Highest Paid Person’s Opinion) or relying solely on customer feedback, can lead to missed opportunities and lackluster products. Instead, a more data-driven approach, leveraging qualitative and quantitative data to validate ideas and make informed decisions.

Finally, it’s important to evaluate how your teams deliver products. Traditional approaches, such as the waterfall methodology, can lead to long development cycles and a lack of flexibility. A more effective approach is to adopt an Agile framework, which emphasizes iterative development, collaboration, and adaptability. But beyond any buzz word type of delivery, find the combination that works for your team. The beauty and challenge in product development - there is no exact way to reach success with your Product Development Lifecycle. However, there is freedom to experiment, fail fast, and iterate faster!

Conclusion

Did any of these findings from SVPG surprise you? One key takeaway is that a product transformation is often necessary before anyone realizes it. It’s important to be proactive in recognizing the need for change and taking the necessary steps to make it happen. This requires buy-in from top leadership, a focus on long-term strategy over short-term goals, a data-driven approach to idea validation, and an Agile approach to product delivery.