How to Define and Scope a Modern Product Company Transformation for Success
By Carla Bendeich and Chad Corneil
We often get asked by our clients to help them modernize their product delivery lifecycles to be more agile and integrated so they can increase their speed to market with new products. While this usually involves building new platforms or applications, our initial approach is to set a holistic scope of both traditional discovery and agile transformation.
The product lifecycle itself is at the foundation of these changes, helping lower the risk and set the stage for successful delivery that includes agile operations and an updated operating model. Leveraging the six elements listed below can help you determine readiness and create plan for a successful transformation to being a modern product company.
1. Product Strategy and Success Measures
Is there a concise and clear product vision? Are the key value drivers identified to develop the objectives, measures, and targets?
Understanding how the product strategy impacts the customer or the business operation is a foundational step in the process. The product strategy and success measures with defined objectives and key performance indicators (KPIs) are where we can help. Objectives such as driving revenue, reducing costs, or deploying new services are usually prioritized while the finer details still need to be defined, socialized, and accepted.
We worked with a financial services firm to address project timing and capacity concerns. This included developing a tool to assess the several hundred projects in flight, map out timelines, and resource needs to create a holistic capacity model. The tool was a game changer for the organization that helped determine when to hire specific resources as well as how to prioritize projects and create budget plans for the next several years.
2. Customer and Product
What is the customer problem and scope getting solved? Who are the customers or personas? What products and/or services align with their experience?
The primary objective is to change or enhance the products or services for customers, whether they’re internal or external to the organization. Defining personas and how they will be impacted along the customer journey is a key step. At a high level, it’s important to know the pain points and where the customer’s experience can be improved.
A global online travel website needed to improve their call center tools for handling reservations and increase revenue through a better customer experience. The company also wanted to decrease operational costs by improving processes and reducing errors.
We worked with the organization to develop a CRM-enabled agent desktop solution for the company’s 4,000 global agents. This included providing leadership on call center strategy, operations, and technology, as well as re-engineering the business process using the Six Sigma methodology.
This led to an increase in revenue through improved cross and upsell opportunities, stronger conversion rates, and a more positive customer experience. The company substantially lowered operational costs by improving average handle times in addition to decreasing attrition, training costs, and errors.
Putting the customer first, building customer journeys and personas, and truly understanding how the product should optimize the experience are critical ingredients to successful customer adoption.
3. Digital Product Intelligence
What is the scope of the data foundations required to support product intelligence and the core value drivers? What are the key applications considered for data integration across the product functional areas?
Most organizations are looking at data as a strategic asset. We use data to review the product itself, usage patterns, customer experience, and the integrations between applications that support the product. This means the underlying data must be usable, easily accessible, and can inform decisions.
We worked with an international aerospace supplier that requested help with its digital transformation. The organization needed to define and prioritize customer-facing use cases that would drive the data strategy.
We delivered the requirements and architecture for the platform to be used to by internal systems as well as external customers. The platform and application programming interfaces (APIs) worked side-by-side with the client team to implement across in-flight projects.
In addition to being ready for a projected 10-year industry growth, the client was able to improve customer satisfaction, create operational efficiencies, and enable a new business model, stating that “the next generation aircraft will be spewing out between 5 to 8 terabytes of data per flight.”
Digital product intelligence can be a game changer for successful product implementations and should be intentionally considered in the preliminary design discussions.
4. Digital Technology Solutions
What are the enterprise applications in consideration to fulfill the product vision?
Becoming a modern product company means helping our clients define the technology applications needed to achieve the customer experience and link the applications to their vision. We know the customer experience and data security could be impacted if there are integrations from outside vendors or suppliers. This requires considering cloud solutions if we’re looking to bring an integrated experience to the customers.
One client — a global automotive manufacturer — wanted to leverage digital services to transform their business model and position themselves as a transportation partner. To do this, the customer needed to identify and create APIs that would leverage data from connected vehicles, smart cities, content providers, and mobility providers. We delivered a platform and APIs working jointly with the client across multiple stakeholders to create a road to connected cars and new revenue from digital services.
At the core of any successful digital or technology-based product is an architecture that is sufficiently robust, compliant, and agile. Taking time to understand this complexity is critical in a successful deployment of a product.
5. Product Lifecycle Operating Model
What business units, geographies, and capabilities are impacted? Are there gaps in the product delivery lifecycle? Are decision rights clear across the leadership team for all functional areas impacted? To what extent are agile practices being used?
We look at the experience, geographies, business units, product lifecycle, and current experience in delivering the product or service. Product lifecycle refers to four key components:
1. Product management: How the organization is going to manage the product and determine priorities.
2. Product development: How the product informs agile development priorities and execution.
3. Product support, services, and operations: How the infrastructure, operations, and customer service support the deployment of the product itself.
4. Go-to-market service delivery: How the product or service will be deployed to the end customers.
As part of an effort to modernize the digital experience for a global products organization, we were able to deconstruct the full operating model, which led to the conclusion that the organization needed to treat the new product as a new service — not just a mobile application. We helped to create and deploy a new structure which led to a successful customer adoption and product implementation.
It’s important to understand the product lifecycle and operating model are at the core of modern product company transformations.
6. Finance and Funding
What are the business case elements required to support the product? Is the organization making appropriate investments in foundations and scaling activities to support the product development and delivery?
As part of a global transformation for a global products organization, we designed the business case around the increased revenue potential for the mobile product. This modeling outlined how the product would increase revenue, decrease costs, and provide a better customer experience. It enabled leadership with a clear and concise approach for approving financial investments.
Naturally, there are several options for funding product delivery. Funding can either be a one-time allocation, run through the agile framework, run through value streams, or run through traditional quarterly funding. The finance team will need to think strategically on how to fund these product efforts.
Conclusion
In summary, we can use these six elements of product strategy and success measures in conversations with our clients to help develop a plan that meets the goals of the program and shapes a holistic modern product company transformation.
Thinking about or working on a product transformation and want to continue the conversation? Leave a comment or reach out to us with your ideas.
Slalom is a global consulting firm focused on strategy, technology, and business transformation. Learn more and reach out today.
