How to Reach Peak Performance With the Product Management Organizational Health Checklist

TRANSFORMING
YOUR IT TEAM:
Copyright © 2021 280 Group LLC. All rights reserved.
From Project-Driven to Product-Led

© 2021 280 Group LLC. 2
Introduction
Understanding Project-Driven vs. Product-Led
A Project-Driven IT Department
A Product-Led IT Department
Comparing Project-Driven vs. Product-Led
The Benefits of Being Product-Led
Measure and Deliver Business Results
Become a Value Center, Not a Cost Center
Be Nimble
Deliver More Successful Products – Faster
Make Smarter Technology Investments
Manage Third-Party Solution Providers More Effectively
Produce Higher Team and Customer Satisfaction
What Skills Does Your Team Need to be Product-Led?
Profit & Loss Ownership
Market Analysis
Competitive Analysis
Voice of the Customer Research
Segmentation
Persona Analysis
Positioning
Forecasting
Writing Requirements
Roadmaps
Launch, Marketing, and Promotion
Product Lifecycle and End of Life
How Do I Transform My Team to be Product-Led?
Start with the “Why”
Show the Path Forward
Get Stakeholder Buy-In
Set Transformation Goals & Measure Progress
Start Small
Improve Your People, Process, and Tools
You Will Need to be Agile
Don’t Forget Finance
Stay Holistic and Committed
Get Assistance
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IT Departments are under pressure like never before. Even before the COVID-19 pandemic
struck, Digital Transformation and other forces were already placing new demands on IT.
According to Lars Van Dam, Vice President Analyst at Gartner, “Transformation toward
digital business ranks at the top of the CIO agenda.” He went on: “We surveyed business
leaders around the world, and while 66% of leaders think that they are digitally
transforming their business, only 11% of CEOs are actually doing so.”
The situation has only become more urgent. IT Departments are being asked to:
• Support corporate strategy by delivering business outcomes rather than project
outputs
• Enable digital transformation
• Deliver services faster and solve the right problems, the first time
• Enable teams with new technologies to satisfy customers and respond to
competitive threats
• Improve employee experience to meet their changing expectations, driven by the
“consumerization” of complex services and mobile applications
These demands are in addition to the typical expectations of your IT team:
• Manage a large portfolio of solutions and technology
• Manage complex third-party services, such as Salesforce, ServiceNow, or Workday
• Rationalize applications across internal markets: divisions, business units, and
geographies
• Have a deep understanding of the business needs of your users
• Promote and educate users on new solutions
• Define a realistic technology strategy that evolves to meet the needs of the business
Traditionally, IT departments have taken a project-driven approach to solving these
problems: establish a project to deliver a solution requested by another department or the
executive team. But with all of the additional challenges IT teams are facing, the project-
based approach is not as effective as it used to be.
According to the Standish Group’s CHAOS 2020: Beyond Infinity report, only 31% of
software projects have been considered successful, with 50% considered “challenged,” and
19% completely failed. That’s nearly a 70% partial or complete failure rate.
Introduction
© 2021 280 Group LLC. 3
Gartner
CHAOS 2020: Beyond Infinity

As a result, many IT departments are now taking a new approach that’s yielding results.
They’re moving from being project-driven to product-led. Gartner reports that 85% of
organizations have adopted, or plan to adopt, a product-centric application delivery model.
Bringing a Product Management perspective to IT improves the overall effectiveness and
productivity of your IT department, turning it into a value-creation center instead of a cost
center. The IT department becomes better aligned with the rest of the organization to enable
more business success—across every team in the company. According to Bill Swanton,
distinguished research vice president at Gartner, “Product-centric approaches allow faster
delivery of the most important capabilities needed. They also force the business to prioritize
the work, and to reprioritize it as requirements are better understood or the market changes.”
Of course, transitioning from a project-driven to a product-led organization isn’t easy, but we
can help you understand the process and get started. In this whitepaper we will:
Compare and contrast how IT departments operate when project-driven vs.
product-led
Review the benefits to the IT department and the whole organization of becoming
product-led
Understand the skills needed to become product-led
Discuss how to make the transition, including pitfalls to avoid and best practices
to employ
Provide resources and tips on how to get started
© 2021 280 Group LLC. 4
reports
product-centric application delivery model
Bill Swanton

To better understand the differences between an IT department that is project-driven vs
product-led, let’s first define these terms.
Understanding
Project-Driven vs. Product-Led
© 2021 280 Group LLC. 5
A project-driven IT Department traditionally operates in two ways.
• First, it provides maintenance and support, by actively maintaining the company’s
technology infrastructure, including providing customer support to the employee
base.
• Second, it delivers new capabilities using projects.
A project is a finite, typically time-based effort to deliver new functionality to users, upgrade
technology infrastructure, or establish a new technology service for the company. Projects
are defined by their scope (the what), schedule (the when), and budget (the how). This
definition is often called the “iron triangle” (see Figure 1.0). A project’s success is measured
by delivering the features that were originally defined in the scoping effort on time and
under budget.
Figure 1.0
Scope
Budget Schedule
Quality

Project-driven IT departments evolved during a time in which development efforts were
delivered using “waterfall” methods. In waterfall development, the “water” of your time,
talent, and money flowed from the beginning of a project through to the end in one, linear
trajectory.
The “scoping” phase of a project would seek to completely define the solution based on
customer requests or infrastructure needs, oftentimes starting with a partially defined
solution that the business team would provide: “Here’s what we want.” Remember, for a
project to be successful, it must deliver the defined scope within a certain time and budget.
Project managers would go to great lengths to define this scope, schedule, and budget up
front. Notice that the project manager focuses on “the what,” “the when,” and “the how” –
but doesn’t spend time on “the why.” Once approved, making changes to any of the three
sides of the iron triangle was to be avoided at all costs, because that would be considered
“failure.”
Even as organizations adopt the Agile development methodology to improve the pace of IT
development, there are still problems. Many IT departments can’t fully adopt Agile, because
they are still tied to the project-driven budgeting approach: they must still fully define the
scope up front, to establish target delivery dates and budget limits that can be measured
against.
In this model, an IT department is a cost center. The success of the overall IT department is
measured by how much organizational efficiency it can deliver at the lowest possible cost.
The ability to address internal employees’ problems along with successful project delivery
are the key metrics of success in the project-driven approach.
Unfortunately, this approach can lead to serious problems. “Tracking activities and budgets
provides a false sense of security that may become apparent only when the software
product hits the market,” wrote Mik Kersten, Ph.D. and author of Project to Product: How
to Survive and Thrive in the Age of Digital Disruption with the Flow Framework.
© 2021 280 Group LLC. 6
An IT department that becomes product-led takes a different approach. Instead of working
on an endless stream of finite projects, it shifts its perspective to consider deliverables as
products used by the rest of the organization. These products are considered long-term assets
that will evolve to continually deliver more value to “customers” throughout the company,
and sometimes to external customers. In this model, IT employs Product Management
techniques to look at the real value its customers need – not just the solution requested.
They ask the question “why?” to dig deeper than the solution request, so they can understand
the real problems that need to be solved, then guide the rest of the team to solve them.
To summarize this approach in one sentence: IT Product Managers are tasked with the
strategic and tactical leadership of IT assets to maximize value creation over the entire life
of that asset.
wrote Mik Kersten
Product Management

It’s important to note that there are still “projects” in a Product-Led IT organization,
but they are run in the context of a product strategy, where each project is a
product release.
A product’s success is measured by its effectiveness in solving customer problems. Based
on Voice of the Customer (VoC) research and value analysis conducted by the Product
Manager, success metrics are established as goals for the product – the real business
outcomes to achieve. Examples include increased efficiency (time to complete a task or
number of tasks completed in a period of time), reduced costs of operation or improved
effectiveness (lower defect rates or better decisions made).
When Product Managers launch a product, they stay with the product to measure its
performance against those goals, to determine success and find new ways to further
improve the product. Whereas in the project-led approach, the project is considered “done”
upon delivery, in the product-led approach, a release is just a step in the product’s overall
lifecycle. This perspective matches well with the Agile development methodology, which
involves rapid product iterations, and an expectation to iterate continuously to serve
customers more effectively over time.
Using Agile methodology and a product-led approach also changes the way products are
planned and budgeted. Rather than conducting a thorough scoping effort up front,
defining the scope of the product happens incrementally over time. Initial customer
research doesn’t accept the business unit’s “here’s what I want” request, but instead takes
the time to work with the business unit to deeply understand its needs.
Once the problems are well understood, the Product Manager and development team
define only enough of the solution to get started building it. Small parts of the solution are
tested with the customer to confirm understanding. This incremental approach allows for
rapid feedback cycles that reduce misunderstandings and increases the odds of product
success considerably.
Developing a budget for a product instead of a project is both easier and harder. It’s easier,
because the budget is developed with success metrics in mind, allowing for an upfront
consideration of Return on Investment (ROI). This leads to a far more compelling business
case to approve the product. But it can be harder, because the costs are tied to preliminary
estimates of the development effort. This can make traditional “command and control”
management teams uncomfortable until they see how well an Agile team can develop a
solution with higher success rates – in less time. Still, this is often the hardest part of making
the transition from being project-driven to product-led.
Even maintenance and support are handled differently in a product-led IT department.
Product Managers pay attention to the problems customers are encountering – additional
input into the product lifecycle. With this broader perspective, they can address the
problems that are hampering progress toward achieving the success metrics.
© 2021 280 Group LLC. 7

© 2021 280 Group LLC. 8
To better understand the differences between an IT department that is project-driven vs.
product-led, we’ve put together this handy comparison chart:
Emerging Trends in Digital Banking
Dimension Project-Driven Product-Led
Vision Cost Center Value Center
Goal Output Outcomes
Success
Metrics
The Iron Triangle: Scope,
Schedule, Budget
Business Objectives & Key
Results (OKRs)
Prioritization Ad hoc or resource-driven Maximize business value
Duration Fixed On-going
Changes Avoided Embraced
Risk High at Launch Reduced Over Iterations
Budget One-time Fixed Ongoing ROI-driven
Team
Organization
Short-term, Per Project Long-term Based on ROI
Lifecycle
Management
Build and Deliver Full Product Lifecycle

"Product-centric approaches make it easier to rapidly innovate and iterate because
they focus on customer experience, evolving requirements, and the strategic
differentiation for a product or service. A product-centric model is ideal for
integrating digital technologies and scales, offering a high chance of growth and
profitability." – Gartner: How To Become a Product-Centric Organization
Let’s examine the benefits that can be realized by taking a product-led approach.
The Benefits of Being Product-Led
© 2021 280 Group LLC. 9
A product-led IT organization shifts its focus from being output driven (how many projects
can we complete?) to being outcome driven (how much business value can we deliver?).
Outcomes are measured by the business metrics that matter to your customer, typically
another department, function, or business at the company.
When asked to do something simple such as, “can you make this tool easier to use?”, a
product-led team will dig deeper to understand what the usability challenges of the tool
are. Further, the team will consider the benefits delivered by making the tool easier to use.
Can the finance department process more outstanding accounts receivables in a week?
Can employees save their own time and the time of HR professionals with a self-service HR
benefits tool? Can the customer service department handle more customer calls per day?
Each of these examples can be measured in a quantitative way that can be converted into
dollars such as increased cash flow or cost savings. In this way, your IT department can now
measure the direct business value it is delivering with each product.
Once you're able to measure the business value of each product your team is working on,
you can ask each Product Manager to calculate the ROI of that product, bringing together
product costs and product benefits.
From that data you can calculate the ROI of all the products in the IT department, to
calculate the IT department’s overall ROI. Then combine this with a few other key metrics
such as:
• Customer satisfaction (both with products and customer support)
• Data integrity
• Data security
Gartner: How To Become a Product-Centric Organization

By deeply understanding your business partners’ problems , you avoid the missteps
common in project-driven organizations that end up building the wrong product and suffer
from low adoption rates.
Combining this product perspective on problems with the Agile methodology allows you to
accelerate value delivery. Your team builds the product incrementally, tests that the
changes enable progress toward solving the problems, adjusts as needed to better solve
the problems, and continues iterating to deliver value, more rapidly.
By having the business metrics well defined for each product, you are also able to prioritize
more effectively. You are no longer solving individual requests one at a time as they arrive.
Instead, you and your Product Managers can look at which products can deliver the
greatest value to the organization with a more strategic portfolio perspective.
Thirty-two percent of respondents to the Gartner survey identified a need to
deliver more quickly as their main driver of adoption of a product-centric
application approach. They said that speed to market was the main driver of their
transformation process.
"They [IT Departments] are no longer a must-have drain on company resources,
they are a team creating more value than they cost the organization and they
can back that up with data." – Colleen O'Rourke, Principal Consultant and Trainer
at 280 Group
Now you have the metrics you need to prove that your IT department is a value center, not
a cost center. With this approach, you can build a simple dashboard to track this
information quarterly and share it with your executive team, increasing the value and
recognition of your team for all to see.
© 2021 280 Group LLC. 10
A nimbler IT department is one that shifts from a linear mindset to an iterative and adaptive
mindset. Change is no longer something to be feared but instead embraced and
encouraged, as your team more effectively determines problems to solve and can adjust its
course to solve them.
Building on this capability also ensures that as external forces change rapidly, your team is
more capable of responding quickly and effectively. The COVID-19 pandemic forced a
tremendous amount of change; IT departments that were able to rapidly respond to new
demands of online services and support a remote workforce were better able to support
their organization.
the Gartner survey

The result is increased adoption, lower support costs, and long-lasting value, according to
Gartner’s survey of over 1,300 IT organizations:
© 2021 280 Group LLC. 11
An effective IT department not only satisfies the needs of its business partners with the
right product portfolio, it also delivers the right foundational technologies and platforms to
enable your organization to remain competitive and innovate.
The Product Manager perspective helps with this work, as well. First, your Product
Managers look at every technology investment from the perspective of the benefits it will
deliver to the whole organization. They apply market and competitive research techniques
Figure 2.0

to evaluate opportunities and vendor choices, not jumping at the first shiny object that
comes along. Most importantly, they can develop a business case for each investment that
considers financial benefits, strategic benefits, payback period, and ROI.
Using these techniques, you and your product management team can make sound
technology investments that will reap the rewards your organization needs most.
© 2021 280 Group LLC. 12
Your IT department is probably responsible for managing services being provided by third-
parties such as Salesforce, Workday, or ServiceNow. Typically, you have someone
responsible for handling service problems with the vendor, taking feedback from the
customer base, and even managing requests for features that your company needs the
vendor to provide.
By treating these services as a product, a Product Manager on your team can more
effectively manage and prioritize feature requests being made to the vendor. By starting
with the problems that really need to be solved, they can be more articulate in their
requests to the vendor, and even collaborate with the vendor to find workarounds and
solutions more quickly. They can even build a business case for their requests to better
convince the vendor that your company’s requests deserve more urgent attention.
By delivering IT Products that better solve your customer’s problems and meet their needs,
you’ll increase job satisfaction for everyone involved. Your business partners will have
higher customer satisfaction, and your own team’s morale will also increase as they receive
more positive feedback, see higher adoption rates, and have more time to work on product
improvements instead of project re-works and trouble tickets.
As the leader of this team, you’ll be more satisfied with the results and gain the recognition
you deserve for transforming your IT department from a cost-center to a value-center.

There’s a difference between the kinds of products a Product Manager in an IT department
produces vs. the products that a Product Manager delivers to external customers. That said,
IT Product Managers still need many of the same skills; they just apply them in a slightly
different manner. In this section we identify the key skills that every IT Product Manager
needs and highlight these differences so that you can be looking for these skills, and
training your team effectively for this transition. The skills are presented in the order that
they are usually applied as a product is being conceived, developed and launched.
What Skills Does Your Team
Need to be Product-Led?
© 2021 280 Group LLC. 13
280 Group
Most IT assets don’t generate revenue, so the traditional “profit and loss” ownership by a
Product Manager needs to be modified for an IT product. Instead of thinking about profit,
the IT Product Manager needs to make quantifiable the value that the product provides to
the organization.
For example, if your Sales team is asking for a new mobile application, how can you quantify
the value this application would provide? Will it reduce the time it takes to close a sale,
reducing the cost of acquisition (CaC)? Will it allow the Sales team to close more sales,
generating more revenue in a quarter? The IT Product Manager will need to prove these
benefits are possible, then use them to calculate the cost savings and revenue potential of
the product. This is the potential “profit” of the product, or the value that it creates for the
business.
Quantifying asset value creation is one of the most important, and often the most difficult,
tasks for the IT Product Manager.
For most IT Product Managers, the
“market” for their products is the
employee base and executive team of
the company. It’s uncommon, but
sometimes Product Managers can see
an opportunity to sell their product or
service to external customers, as well.
See the sidebar story about Amazon
Web Services for a prime example.
How an internal product became
a multi-billion-dollar business
Today, Amazon Web Services provides the
computing power and storage for thousands of
businesses across the globe. But AWS got its start
as an IT product at Amazon, as the foundation of
its bookselling business. To learn more about how
IT product management thinking led to this
amazing business, check out Exclusive: The Story
of AWS and Andy Jassy’s Trillion Dollar Baby | by
John Furrier | Medium.
Exclusive: The Story of AWS and Andy
Jassy’s Trillion Dollar Baby | by John Furrier |
Medium

Using market analysis techniques like PESTEL or SWOT analysis enables your IT Product
Managers to make more effective decisions about problems to solve and solutions to
choose from. They know how to consider the entire ecosystem of the company, instead of
just one department’s needs. They look at the politics of the organization, the legal and
regulatory considerations, and even the social and safety implications of a solution. They
also consider how to leverage company strengths, improve areas of weakness, take
advantage of external opportunities, and avoid threats.
© 2021 280 Group LLC. 14
IT Product Managers can use competitive analysis techniques to evaluate external vendors
vying to offer your company a service and to analyze your own company’s competitive
situation. Using these techniques helps you and your team determine the best solutions
you need to deliver, to maintain or grow your company’s competitive advantage.
For example, using a Porter’s Five Forces analysis, your team can identify which
technology vendors will best handle a server supply shortage or what new technologies
your company should adopt to get ahead of your most significant competitors.
For IT Product Managers, Voice of the Customer (VOC) research is essential, however most
IT departments lack extensive experience with this discipline. Digging into problems using
customer interviews, focus groups, surveys, or “day in the life” exercises provides a deep and
thorough understanding of the problems to solve for your business partners.
For example, consider what happens when a customer asks your team to develop a better
input screen to enter finance information received from a vendor. The customer points out
how several fields don’t match the information in the report and should be changed. While
it’s simple enough to make the requested field changes and call the project done, using
VOC techniques, your IT Product Manager discovers that this report is received several
times a week and takes 15-20 minutes of manual data entry every time. Furthermore, the
report is generated by the vendor’s Salesforce system, then entered manually into your
company’s Salesforce instance. The problem isn’t really the need to change fields, but to
make the process of generating the reports more efficient. Perhaps automating the
transfer of information from one Salesforce system to another can enable the finance
customer to simply review and accept the report with one click. That is solving the real
problem!
Does your IT team tend to deliver solutions specific to a particular department’s needs? Or
does it develop solutions targeted to particular job functions across the entire company?
Maybe the solution can be applied across different geographic divisions? Using
segmentation techniques, your IT Product Managers can define the right characteristics to
determine which approach to take when evaluating a problem to solve, and how to
develop solutions that reach the right audience.
competitive analysis techniques
Porter’s Five Forces analysis
Voice of the Customer

Once your Product Managers understand the segment of the business they are serving
with a particular product, they must consider all the personas that will use or influence the
solution. Oftentimes, IT teams will only consider one kind of end user, ignoring others, and
non-users that nevertheless will have an influence on the problems that need to be solved.
For example, a new inventory reporting system will not only need to satisfy the needs of
direct users of the system, the managers who receive the reports and the external vendors
may require supply chain integration through third-party APIs. If the manager who will
never use the system doesn’t like the format of reports she receives from users, will the
solution be successful?
IT Product Managers who use persona analysis can systematically identify all of the
stakeholders, develop a “persona” that identifies their background and needs, and ensure
that the needs of all stakeholders are taken into account as a solution is developed. Once
again, this approach reduces the odds of failure for each product release, and improves the
odds of strong adoption and customer satisfaction.
© 2021 280 Group LLC. 15
Proper segmentation and positioning are essential to a well-defined solution. A positioning
statement defines the target audience to be served, the key benefits the product provides
to them, and what differentiates the product from other solutions. If it’s well written, it also
serves as a way to define what shouldn’t be included in the product: if a feature doesn’t
contribute to a benefit in the positioning statement, it’s probably not needed.
In the Agile methodology, a powerful positioning statement also serves as the product
vision statement for the solution, aligning the whole product team and helping to control
scope creep.
It’s difficult to develop an effective positioning statement, but once it’s done, it makes
feature prioritization, launch, and messaging much easier, and increases the chances of
high adoption rates. Clear positioning gives your IT department a leg up in adding real
value to the organization.
Being able to build a defendable forecast for adoption is critical to sizing service needs,
building P&Ls, calculating ROI, and prioritizing work. Your IT Product Managers need to
know how to build forecasts both from historical data and proxy data when historical data is
not available.
product vision statement
product vision statement

Writing requirements is a skill area that your IT team is probably already well-versed in. That
said, using all of the Product Management skills mentioned here will help improve the
quality of your requirements. Your team will be using real data to define the product’s
requirements, as they now understand the problems of the target audience, the impact of
the solution, and the expected business value of solving those problems.
© 2021 280 Group LLC. 16
Roadmaps communicate a time-based view of your product priorities. They are essential for
planning and communicating, both up and down the chain of command. IT Product
Managers learn to demonstrate how their strategic plans support the organization and how
their initiatives will coordinate with others across the organization by writing long-term
product roadmaps instead of short-term project schedules.
One of the most overlooked aspects of IT product management is that internal solutions
still need to go through a formal launch process to ensure the best possible adoption and
usage. While an internal product launch takes less effort than launching a product to
external customers, utilizing the right product management techniques maximizes the
opportunity for product success and user adoption. It ensures that users receive proper
training and customer support, and establishes the right feedback loops for measuring
usage and learning how to improve the product moving forward.
You try to avoid this, but sometimes IT groups can fail to build on existing solutions once
they have produced them. Each task is treated as a new project, dropping old development
like last year’s ratty tennis shoes. But when your solutions are products that have a Product
Manager involved for the long term, this becomes less of a problem. Applying Product
Lifecycle methodology enables IT Product Managers to build products intended to evolve
as their customer needs evolve. An IT Product Manager is able to anticipate the typical
needs according to a product’s maturity cycle, including when the product should be
considered for retirement.
Retiring a product is often considered “launching a product in reverse.” Your IT Product
Managers learn how to use the same techniques to help transition off the current product,
possibly migrating to a new system, with minimal cost or disruption to employees.

Be Patient. This first step may take some time, depending on the size of your
team, your company, and your company’s appetite for change. Start with the
executive discussion, but know that you’ll probably have to take what you learn
from that discussion and apply it to your team discussion, and vice-versa. Expect
to iterate both once or twice to really get together a proposal that gets buy-in
from both audiences.
By now, hopefully you are excited by the prospect of transforming your team from being
project-driven to product-led! But how do you get started? In this section we’ve collected
some of the best practices as well as pitfalls to avoid as you begin your transformation.
Even with this information, you may want some help. Contact us and we can talk through
where you are on your journey, and how we can best help you with free resources, training,
and consulting.
How Do I Transform My Team
to be Product-Led?
© 2021 280 Group LLC. 17
280 Group
We recommend building your case for two audiences – your peers on the executive team
and your own team -- using all of the information in this paper.
For your executive team pitch, keep it to one page or a few slides, and be sure to hit on:
• Current challenges you and your team are facing, with one or two concrete
examples of projects or efforts that could have been better.
• How becoming a product-led organization can address these challenges.
• Expected ROI within the first 12 months, which could be quantitative, or point out
specific “projects” that could benefit from becoming products -- or a bit of both.
Consider pitching your proposal to a key internal customer who also sits on the executive
team first. Get their feedback on how to make the pitch successful, and their support as an
ally during the discussion with the larger team.
280 Group’s Critical Importance of Product Management workshop can be another
powerful tool to build executive team support.
For your own team, create a more detailed, collaborative presentation that explains:
• An appraisal of current team challenges, perhaps with an exercise to draw out from
your team even more of the issues that need to be addressed.
• How becoming a product-led organization can address these challenges.
• What roles will look like in the new organization (see Show the Path Forward below).
• A rough timeline of how transformation will take place, without a start date, but
with a rough estimate of how long you think it will take. Demonstrate patience in
balance with a call for hard work and commitment to make it happen.
Contact us
Critical Importance of Product Management

A key challenge to overcome early is resistance to change from your own team. The project-
driven approach has been around for decades, and your team is used to the roles they play
within it. As part of the pitch to your team, show them the career paths that will open up
during this transformation.
For example, your current business analysts are great candidates for becoming Product
Managers or Product Owners. Those that enjoy high-level thinking, problem exploration,
and working with business partners will likely gravitate to the Product Manager role. Those
that like to dig into the architecture, solution approaches, or detailed requirements could
make great Product Owners.
Project Managers may want to become Product Managers, or stay in the project
management role, knowing that the role will shift. Project Managers are still needed in
product-led IT organizations to coordinate the increased collaboration with the business
partners, conduct market research, coordinate product increment test cycles, gather
feedback, and drive launch and ongoing usability research. In this new model, Project and
Product Managers become essential partners.
If your team is already using the Agile development methodology, you’ve already
established scrum masters and product owners. But if you’re making this transition as well,
these are new roles that team members can fill. Don’t forget the need for a usability/user
experience team, too.
Make an honest appraisal of your team, and recognize that not everyone will be able to, or
want to, make the transition. Help your team members find roles that will work for them –
whether inside or outside the organization.
© 2021 280 Group LLC. 18
Transforming the IT department will initiate changes with other teams, as well. Most
importantly, your internal customers will need to adjust to a more collaborative relationship.
No longer can a team just submit a ticket and expect a new project to be launched. Instead,
customers will need to invest more time in sharing their problems, and work with your
Product Managers to participate in interviews, focus groups, surveys, or “day in the life”
exercises.
Use parts of your executive pitch to demonstrate to your business partners the benefits
they will receive from this transition. Get them excited about the prospect of receiving
better solutions that make them more productive in a shorter time. This will require more
of an investment over the entire product lifecycle, sharing problems, testing out prototypes
and product iterations to make sure they are delivering the expected value.
Take some time early in the process to get a key customer stakeholder involved in this
transformation, so that they can help promote the need for change.

In some ways, the transformation of your IT department is a product in and of itself, so it’s
important to set up success metrics to demonstrate that the department transformation is
yielding business value. Here are some of the typical metrics we’ve used with past clients:
• The business value of each product: Nothing proves the value of a product-led IT
department more than demonstrating that each product is achieving its business
goals.
• Return on investment: Using the quantitative success metrics of each product in
your portfolio should allow you to build an overall ROI of the IT department on an
annual basis. This metric proves your IT department is now creating net positive
value to the organization and is no longer a cost-center.
• Time to value. The easiest way to measure this is to track the number of product
releases per year vs. the number of project completions per year. Using Agile
methodology and a product mindset should provide more frequent releases and
incremental value to your customers.
• Customer satisfaction and user adoption: While most IT organizations already track
user adoption, few track customer satisfaction in a quantitative way. Be sure to track
both for every product release to see how quickly your product-led approach yields
results.
• “Failed projects” per year: Remember the nearly 70% failure rate of software
projects measured by the Standish Group? Expect this metric to drop significantly
once your organization is product-led.
© 2021 280 Group LLC. 19
280 Group clients have benefited from inviting stakeholders to a one-day training on
product management processes, techniques, and tools.
At a larger organization, it may be wise to pick one project and transform it into a product. A
pilot product can uncover hidden surprises, additional needs from other teams, and help
you find methods that work for your organization. With the right product success metrics in
place, you’ll provide real proof over time that the product-led approach delivers results that
your business partners appreciate. Your team will also see the benefits and want to extend
these new practices across the IT organization.
"Only the IT organization that embraces product thinking and puts its business
customers first will bridge the growing gap between what customers want and
what IT delivers." – EY: Product thinking at the core of the new IT organization
one-day training
EY: Product thinking at the core of the new IT organization

© 2021 280 Group LLC. 20
Another part of gaining the support and confidence of your team around transformation is
to demonstrate that you will give them the support they need to succeed.
Providing your team with the training, process, and tools they need also significantly
increases the odds of your transformation success. 280 Group’s Product Management
Skills Benchmark Report has shown that Product Managers who have received formal
training and work in an organization that has a formal Product Management Process
possess skills that are, on average, 26% higher than other Product Managers. Those stronger
skills will drive your IT products to success.
Use the skills discussion earlier in this report to identify the areas that your team will likely
need the most help with. If you want to get a deeper and more accurate take on your
team’s skill gaps, contact 280 Group, and we can administer our Individual Skills
Assessment to your entire team. The results of the assessment will help us tailor the right
training program for you.
If you want to learn more about how a Product Lifecycle process works, download our free
E-Book, Optimal Product Process™, used by more than 500 companies.
Finally, invest in tools that enable you to better track product usage, customer satisfaction,
and the business metrics that matter to your products. These should integrate with the
product process tools you use to define requirements for your Agile development process.
Combing a product-led approach to IT with the Agile development methodology provides
numerous synergies: Product management thinking defines the business value that Agile
can rapidly deliver through discovery and iteration. The tight integration between
discovering and defining requirements and guiding engineering are the two parts of Dual-
Track Agile development.
As the left side of the figure below illustrates, IT Product Managers learn from in-product
data analytics. They form a hypothesis as to the next-best functionality then guide
engineering as they develop the next most important item that positively improves the
customer’s experience.
Product Management Skills
Benchmark Report
Product Management Skills
Benchmark Report
Optimal Product Process™

© 2021 280 Group LLC. 21
There are many moving parts to transforming an IT team to be product-led. One
challenging area that often gets overlooked is the way financing IT products should be
done differently from the way projects are budgeted. We’ve seen great transformation
efforts become stymied by teams being required to build a “project budget” every
September for the whole next year – and having to live by it for another 12 months.
To maximize the success of the transformation, you’ll need to shift the budgeting process
to be about outcomes rather than outputs. In this approach, you prepare a product budget
that looks at the investment costs compared to the business benefits the product will
deliver. If it costs $200,000 to develop a product that will yield $300,000 in cost savings and
efficiencies, you’ll quickly win over the Finance team and become less concerned about the
old way of tracking the budget on a monthly basis to ensure you’re staying under budget.
Instead, and more importantly, you’ll be measuring the real business results the product
delivers -- and finding ways to improve this over time.
This approach to budgeting is better suited to adapting to new discoveries as you iterate on
new product releases. With each discovery, you no longer fear “breaking the budget.”
Instead, you focus on identifying the costs to address the discovery and the financial
benefits of the proposed change. Does it produce an acceptable ROI? If yes, it’s now easy to
adjust your product plan and move forward. If not, you know not to pursue the change,
because it won’t provide business value to the organization.
Again, present the evidence of the success of being product-led, demonstrate the reality
with a pilot product, if necessary, then shift the budgeting process accordingly over time,
with the support of the CFO and CEO.
Check out our Agile Product Management guide to learn more about how Product
Management and the Agile development methodology complement each other.
Learn Sprint
planning
Sprint
execution
Product
backlog
Sprint
review
Shippable
increment
Try experiments
Pivot/persevere?
M
easure
B
u
i
l
d
ITERATE
PM Discovery Agile Development
Customer Solution
Agile Product Management
Figure 3.0

As you begin to see success, keep in mind that transformation is going to take time and
sustained effort before it’s successful:
• Support your team beyond initial training with ongoing skill upgrades through
additional training, workshops, and webinars. Some of 280 Group’s clients have
benefited from consulting services to help implement processes more smoothly, or
tackle particularly challenging problems such as establishing an initial product
roadmap.
• Evolve and adapt your product development process, including budgeting methods,
as you learn what’s working and what needs to improve.
• Keep the lines of communication open with your executive team to report on
progress against business metrics, risks, challenges, and product successes. Be
honest, and you’ll have the support you need to drive transformation forward.
Still wondering what to do next? Most major team transformations require assistance from
trusted advisors who have done this before and can bring an objective, external perspective
to help you. Contact us to start a conversation about your needs and how we can help.
CONTACT US
CONTACT US
Contact us
About 280 Group
280 Group is the world’s leading Product Management training and consulting firm. We
empower Product Professionals with the knowledge and tools to deliver products that
matter. We have been in business for 20 years and serve clients around the world. We are
named after the famous Highway 280, a corridor that houses the world’s most innovative
companies and links San Francisco and the South Bay Area. Our products and services
include consulting, contractors, training, certifications, templates, coaching, books, and a
Product Management optimization program.

How to Reach Peak Performance With the Product Management Organizational Health Checklist

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