Investment in digital transformation is seen as vital to the success of a business and is expected to reach $3.3 trillion in 2025. However, achieving business value from this investment is proving elusive with 73% of digital transformation projects failing to provide business value.

To address this wastage, we are seeing organisations making the shift from project-focused based delivery methodologies to a product model. Outlined in this article are some of the more common pitfalls an organisation is likely to experience when making the transition and how to mitigate the impact of these pitfalls during this transition period.

The transition from a project model to a product model is a continuum along a maturity path and the table below indicates each end of the continuum:

When an organisation embarks on the transition towards the product model here are some of the common pitfalls they will encounter.

1. Lack of clear product vision: Without a clear and measurable product vision that aligns with the organization's overall strategic goals, it can be challenging to guide product development efforts and ensure consistency in decision-making across teams.


2. Short-term focus: Becoming a product-centric organization requires a long-term strategic focus on delivering value to customers and continuous product improvement. Overemphasizing short-term financial results or reacting to immediate market pressures may hinder the organization's ability to build sustainable, customer-centric products.


3. Inadequate feedback loops: Continuous feedback from customers, stakeholders, and the market is essential for product-centric organizations to iterate and improve products. Lack of effective and data driven feedback loops and mechanisms for incorporating feedback into product development can result in products that do not fully meet customer needs.


4. Lack of customer-centricity: Being truly customer-centric requires deep customer insights, understanding of customer needs, and involving customers in the product development process. Failing to prioritize the customer perspective and relying solely on internal opinions and assumptions can lead to misaligned products.


5. Overemphasis on technology: While technology plays a crucial role in many products, overemphasizing technology without considering the broader product strategy, customer needs, and market dynamics can lead to misaligned product outcomes and missed opportunities.


6. Resistance to change: Moving from a traditional functional or project-based organization to a product-centric approach requires a mindset shift and changes in roles, responsibilities, and processes. Resistance to change from employees, especially those who are used to working in traditional structures, can hinder progress. Need to recognise the magnitude of resistance and the associated focus and effort to mitigate.


7. Inadequate product management practices: Product management plays a critical role in product-centric organizations. Lack of well-defined product management practices, such as market research, product strategy, and product roadmap development, can lead to inconsistent product outcomes and direction.


8. Lack of empowered product teams: Empowered product teams that are given decision-making authority and autonomy are critical for a product-centric organization. Without clear roles, responsibilities, and empowerment for product teams, decision-making can be slow and hinder agile product development.


9. Siloed organizational structure: If the organization's structure and culture promote silos and lack cross-functional collaboration, it can hinder the transition to a product-centric approach. Effective communication and collaboration across functions are essential for successful product-centric organizations.


10. Insufficient investment in product development: Successful product-centric organizations invest in product development processes, talent, and resources. Insufficient investment in these areas can result in inadequate product quality, slower time-to-market, and missed opportunities for innovation.

There are three key areas that will enable an organisation to become more product-focused and unlock value and will minimise the risk and impact of the common pitfalls. These three areas are:

• Develop a product mindset & culture: A product mindset is critical in shifting the culture of a company to support a consumer-centric product model and embedding a product mindset and culture that brings the consumer to the centre of all interactions.


• Transition to a product-focused operating model: Process and organizational alignment across the product development lifecycle are critical to bringing product mindset into the operating model. By redefining the operating model processes & talent to drive towards collective outcomes.


• Establish product-based governance and funding structures: Establishing a governance structure and funding models are key enablers to actualizing the product model. New governance and funding models rooted in rapid iteration and outcome-driven planning.