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After a decade of ZIRP-driven expansionary growth strategies, many companies are now refocusing on generating organic growth within their core or adjacent business areas. Instead of outsourcing growth activities to greenfield innovation labs, leading companies are shifting towards creating empowered, cross-functional core teams that own business outcomes end-to-end. After all, it’s about leveraging technology effectively and building the best possible solutions for a company’s target users. This approach has been coined as product organisation, hence we’re excited to explore this topic together with Ken. He’s currently working as interim CPO, where he focuses on building and transforming successful product organizations that deliver high value for their customers. Before that he spent almost six years at BCG X, where he built ventures and products in the climate tech, health, mobility, logistics, automotive, insurtech and fintech space. You can check out his website here and LinkedIn here.

The importance of vision

Ken emphasised that a strong vision is the cornerstone of any successful product organization. It’s not just about setting a direction but inspiring and rallying the team around a shared goal. The vision should articulate why the company exists and the positive change it aims to bring to its customers’ lives. It’s crucial to start with the customer problem and envision a solution, rather than starting with a technology or product and searching for a problem to solve. This vision must be clear and compelling enough to drive the team through the inevitable challenges and setbacks they will face.

We discussed how many companies often make the mistake of starting with a solution and then looking for a problem. Instead, the focus should be on understanding and defining the customer’s problem first. A well-defined vision answers the fundamental questions of why the organization exists and what it aims to achieve, painting a vivid picture of the future where the customer’s problem is solved. This vision should be communicated consistently and integrated into the daily operations and culture of the organization.

Setting a strategic focus

The discussion highlighted the distinction between strategy and planning. A good product strategy translates vision into actionable steps while allowing the organization to focus on what truly matters. It involves placing strategic bets and understanding that not all will succeed. The ability to say “no” to non-essential activities is a hallmark of a sound strategy. This focus ensures that resources are directed towards efforts that align with the strategic goals of the organization.

Ken pointed out that many companies fail to differentiate between a strategy and a plan. A plan is a detailed roadmap outlining steps to achieve a goal, while a strategy is a broader framework that guides decision-making and prioritization. A robust product strategy should help the organization prioritize the key initiatives that will drive the most significant impact, allowing it to focus its efforts and resources on these areas. This often involves making difficult decisions about what not to pursue, ensuring that the team’s efforts are not diluted across too many initiatives.

Building the right culture

Culture is a critical component that supports the vision and strategy. A culture that fosters psychological safety allows team members to express their ideas and take risks without fear of failure. This environment is essential for innovation and continuous improvement. Practical tools, like using OKRs (Objectives and Key Results) to set strategic bets, help embed a culture of learning and experimentation. Failure should be viewed as a learning opportunity, not a setback.

Ken explained that creating a culture of experimentation and learning is crucial for a product organization. This involves encouraging open communication, where team members feel safe to share their thoughts and ideas without fear of retribution. Psychological safety is the foundation for healthy conflict, which is necessary for innovation. When team members can challenge each other’s ideas constructively, better solutions emerge. Moreover, using OKRs to set ambitious yet achievable goals helps teams focus on what matters most and measure their progress effectively. Celebrating successes and learning from failures are both integral to this process.

Organizational structure and process

Reorganizing around cross-functional teams was another key point we discussed. Effective organizational design supports collaboration and accountability. In many companies, particularly large ones, silos can hinder innovation and slow down processes. By ensuring that all relevant functions, including IT and compliance, are involved from the beginning, organizations can better align their efforts towards common goals.

Ken shared his experience working with an Australian bank, where a large-scale transformation involved 500 people. The bank aimed to center its organization around customer journeys and adopt agile methodologies. However, the initiative faced challenges because the deeper layers of IT, responsible for compliance and other essential functions, were not adequately considered into the transformation process. This highlighted the importance of involving all necessary stakeholders from the start and ensuring that the organizational design facilitates collaboration across different functions.

Empowering teams

Empowering teams to take ownership of their work from discovery to delivery is crucial for fostering innovation and accountability. I mentioned a case where a financial services organization successfully implemented Marty Cagan’s principles by giving product managers end-to-end responsibility. This approach ensures that the people who come up with concepts are also involved in the delivery, which helps them understand the practical challenges and constraints.

By breaking down silos and creating cross-functional teams, organizations can enable better communication and collaboration. This structure allows teams to be more responsive to customer needs and adapt quickly to changes in the market. It also ensures that all relevant perspectives are considered, leading to more holistic and effective solutions.

Getting started

Transforming into a product-led organization requires a clear vision, a focused strategy, a supportive culture, and an effective organizational structure. While the journey is challenging, starting small with cross-functional teams and iterating on successes can pave the way for broader transformation. The principles we discussed in the podcast provide a valuable framework for companies looking to stay competitive and innovative in today’s fast-paced market.

Understanding and implementing these principles can be daunting, but as Ken noted, it’s a journey worth embarking on. Starting with yourself and committing to the process is the first step towards creating a resilient and customer-centric product organization. It’s not about overnight changes but about making continuous improvements that align with the company’s vision and strategic goals. By fostering a culture of experimentation and collaboration, and by empowering teams to take ownership of their work, organizations can unlock new levels of innovation and organic growth.