Turning IT into a Self-Perpetuating Value Creation Machine

Our organization is going through a transition from a project operating model to a product operating model. Many enterprise organizations are pursuing a similar path and are at various stages of the journey. I’d like to use this article to explain why I am so enthusiastic about this change. In so many ways, this pathway helps me realize some career-long objectives. Before I get into that, we should define a few terms.

What is a product?

In this context, a product is a digital capability with a defined customer base, a stable investment stream, and a durable team that creates value for customers and the business. Sometimes, it’s easiest to understand a product in terms of what it isn’t. Simply put, it’s not a project.

Projects have a start and an end. Projects get funding, assemble a team, build an asset, put it into production, then disband and move on to the next thing. Products aren’t always better than projects. There’s room for both. However, for much of what IT does, the product model is a better fit.

Product and other terms

Product is closely associated with the concept of?agile software delivery. This is the concept that gave IT incremental and iterative value delivery methods. Add to this,?DevOps. DevOps is the concept that bridged the gap between development and operations to bring total technology ownership of development, support, and security to a single team.

Finally, I’ll add?cloud?to the mix. You don’t need the cloud to do the product model, but it sure helps. Cloud brings advanced technologies with financial transparency that really completes the picture.

Value and trust

Some look at IT as the place where money goes to die. I’ve been working hard to fight that perception my whole career. The secret to turning that perception around is value creation.

We’ve been working hard to build business and customer confidence in our capabilities. We’re building a self-perpetuating value creation machine. One dollar in. Two dollars of customer value out. Repeat.

This whole system is built on trust. We build trust with clear goal alignment, real customer insight, and iterative value delivery. When we understand customer problems and reliably solve them with good process, technology, and data, we earn trust.

Once trust is established, then we can work on more difficult problems, taking reasonable risks along the way.

We won’t change the world overnight, but if we stay on this mission, we will get there.

The short shelf-life of digital products

Some people get annoyed that their new iPhone becomes completely obsolete in 5 years. I’ve grown to accept it, and expect that technology has a very short shelf-life. We have a choice. We can be disrupted by technology obsolescence, or we can just plan on it.

The product model plans on it. We don’t disband teams after the job is done because the job is never done. We have a never-ending list of enhancements to tackle and a full complement of technology components to upgrade.

The short shelf-life of customer needs and business strategies

I’m a future-oriented person. I am constantly preoccupied with?future trends. Yet, I put very little stock in my current understanding of where we will be in 5 years. That understanding will probably change really soon.

I expect the same thing from my business leaders and customers. We better solve today’s business problems today, otherwise, we won’t be ready to solve tomorrow’s problems tomorrow.

I like the product operating model because changes in strategy don’t break it. Reprioritization and change are part of the rhythms.

The one thing I know about the future is that I’m currently wrong about what the future will hold. Therefore, let’s plan accordingly and be light on our feet.

The vision

I didn’t get into technology leadership just to pump out technology demand and fix stuff when it breaks. I want to change the world. Yes, I realize that’s grandiose, so let me explain.

I believe in my team. I believe in the culture we are building. I believe in the transformational power of well-designed technology and data solutions. I believe magic happens when tech teams collaborate with customers and business people. I’ve seen it.?I’ve experienced it.?We can and need to do a whole lot more of it.

This way of working cultivates an environment that connects people to the value of their work – giving their work more meaning. Happier, more engaged employees create better products that create happier, more engaged customers. It’s a virtuous cycle.

The path

Change is coming?and it won’t be easy. Organizational patterns and behaviors are deep-seated. How do we get from here to there? One step at a time.

We learn. We practice. We succeed in the small things before we tackle the big things. We support the willing, listen to the resistant, and talk with everyone.

Here we go!

Read this article on my?blog site?or listen to it on my?podcast???