Over the years, organizations have adopted agile solutions to decentralize their traditional structures and move towards dynamic solutions and hyper personalization. The flexibility of Agile, combined with the streamlining of processes and elimination of the command-and-control system, enables these organizations to thrive and create increased business value.
Traditionally, in a project-based delivery model, businesses aim to deliver individual projects on time and on budget, independently. However, such an approach restricts quick pivots in product or strategy, if needed. Yet, most organizations struggle to move away from project-based approaches because of a legacy mindset and hardwired analog processes.
And that’s where product-centric delivery provides differentiation. The Agile approach emphasizes on incremental delivery and team collaboration as well as continual planning and learning. Product-centric delivery aims to reinforce and refine those principles. Instead of approaching business as a series of projects, product-centric delivery aims to create value holistically and deliver business capability in a continuous mode. It continues to leverage an Agile mindset but is centered in product thinking. It focuses on customer value at every touchpoint on their journey. In this context, a product can refer to a collection of business capabilities offered to a specific category of customers – for instance, warrantees offered by automobile manufacturers or payment services offered by fintech companies. Product-centric delivery has been the prevalent approach in several new-age and digital-native start-ups with the advantage of a flatter organizational structure that allows more agile ways of working and fast-paced innovation cycles. This iterative and evolutionary approach builds on the advantages of the Agile methodology allowing businesses to compete in today’s market where organizations experience a much higher velocity of business change. These patterns of Agile adoption are also common in large-enterprise IT departments, but the business side has usually lagged. However, increasingly, incumbent business owners are making the switch to product-centric Agile delivery in order to avoid working within fragmented value chains and silos that have traditionally made it difficult to realize the intended business outcomes and end-user experience.
More firms will need to adopt ways where several business lines can collaborate to offer greater value to their customers. Enterprises, therefore, have to organize their IT delivery around customer journeys and associated value streams instead of traditional business processes and operations.
Product-centric delivery is a mindset change and enables customer-centricity across the value chain. Agile teams, aligned to an overarching purpose and vision, help amplify innovation and deliver significant business value. Besides this strong focus on customer value, business outcomes are measured by objectives and key results (OKRs).
For example, for an insurance company, there is no definite start and end to the insurance products, which need to maintain currency to meet the dynamic market needs, counter the competition, and take cognizance of situations like COVID-19. Even though life insurance has been around for decades, the product features, market expectations, and customer journeys are constantly evolving and hence require an always-on product-centric delivery approach.
The benefits of Agile combined with product-centric delivery
According to Mik Kersten, the author of Project to Product: How Value Stream Networks Will Transform IT and Business, visionary Agile organizations are those that are “creating and managing their value stream networks and product portfolios in order to leapfrog their competition in the age of software.”
Modern product-based, data-driven businesses are able to explore additional business opportunities with the adoption of Agile behavior, including upskilling and self-organized teams, to achieve the larger organizational vision as well as business goals. Businesses can also create new business models and revenue sources.
Product-centric delivery gives organizations the ability to operate like a digital start-up where both technology and business are integral to the strategy, and the organizational structure is not bogged down by layers of administration and hierarchy. A product-centric, lean start-up approach to Agile keeps employees in tune with both market and client demands. Adoption of Agile and DevOps ensures faster releases and feedback loops to further refine the product for the market. Product-centric delivery is characterized by a culture of innovation and experimentation. Organizations that foster such a culture can provide ever-better products and customer experiences. Large organizations can instill product-centric delivery models aligned with customer journeys and value streams driving a continuous innovation process as well as richer end-user engagement.
A sound Agile strategy requires leadership of visionary firms to move the right levers at the right time to sprint ahead of the competition. A product mindset ensures teams are in tune with both market and customer demands and can define the product roadmap as well as get an executive buy-in.
For product-centric delivery to work, organizations must create high-impact, persistent, and cross-functional teams aligned to orchestrate the flow of value, regardless of organization size.
Many organizations are using product managers to catalyze their move towards a product-centric delivery model. In fact, according to last year’s Agile Radar research by Infosys, onboarding customer-centric product managers is a top investment for businesses.
It is also imperative that the roles of business and IT teams are aligned around value streams and optimized with minimal redundancy. To drive product-centric delivery, a focus on Agile-DevOps adoption is often necessary in bringing together cross-organizational capabilities. Additionally, an apposite technology partner can bring in expertise in AI, Cloud, and DevOps, which are essential to digital transformation and innovation today.
The customer-centricity across the value chain helps firms achieve business value faster. Such organizations demonstrate increased business agility and innovation along with improved business outcomes including market share, employee satisfaction, and lowered costs.
The article has been written by Pravin Kulkarni, Vice President and Delivery Head – SAP Practice, Manufacturing, Financial Services, Infosys