The beginning is always a good place to start, so what is digital product management and how does it relate to value stream management?
First, let’s say a word from research guru Gartner, who notes that big tech companies can accelerate their growth by applying more agile product management. He emphasizes that product teams need to respond effectively to customer experience insights, changing pricing and delivery models, and new drivers of digital transformation within their customer base.
As customers undertake digital business transformations, such as enabling new Internet of Things technologies and leveraging analytics at the heart of the business, product managers must extend the reach of their capabilities planning and development to help companies achieve their digital business results.
Therefore, digital products and services may include “as a service” delivery models, customer experience as an integral development feature, and other new business models. More often than not, designing these complex technology solutions will require new skills and processes compared to unique hardware or software products or services.
In a nutshell: Digital Product Management (DPM) is an evolving set of practices intended to respond to the changes occurring in technology management due to digitalization. Instead of one-off projects, organizations now continuously manage all of the underlying components that the digital product is made up of.
This way, the business effectively connects work, teams, and budgets such as software, services, and APIs. Rather than individual programs or projects, companies receive clear insights into business outcomes, including costs, benefits, and ROI of their investments.
When viewed as part of Value Stream Management (VSM), DPM enables companies to fund their most valuable investments and deliver a return on investment to the business.
What’s new in 2022?
As 2022 dawns, many of us may think digital transformation is in danger of becoming a cliché, but it’s important to point out that the principles behind it are anything but.
At their core, digital transformation or digitization – choose your term – are processes that allow companies to serve their customers virtually, including industries that in the past would never have considered an online presence, such as dry cleaners and pizzerias.
If the global pandemic has done nothing else, it has shown business owners the importance of digitally interacting with customers anywhere, anytime. This reinforces why companies like IDC predict that companies will invest $6.8 trillion in digitization programs by 2023.
Going down a level, DPM is really a story about how people view spending money on technology.
So companies that hadn’t spent a lot of time on technology before are increasingly investing in understanding how technology is developed, how quickly it can be integrated into their business, and to what extent it affects them. helps meet the needs of their customers.
Digital product management is an evolving set of practices intended to respond to the changes occurring in the management of technology due to digitization. As part of VSM, DPM enables organizations to finance their most valuable investments and prove the return on investment to the business.
Going down a level, DPM is really a story about how people view spending money on technology. For a long time, companies decided they needed something from the tech store – software or a system – to achieve a particular goal, like launching a new product or modernizing HR. They would then go through a rigorous process of reviewing what they needed, who should work on it, what it was going to do, how much it would cost, etc.
They would then run it through several layers of approvals, develop a project charter, and send it to one or more steering committees to get it funded. This progression cannot be described as favorable to change.
With each adjustment, the process repeated itself because the financing could change. It was a rigorous and expensive method that emphasized the control of innovation. As businesses increasingly embrace the new digital world, they recognize that legacy business operations must change significantly in order to support an ever-changing digital way of operating and interacting with customers.
How does DPM impact the business?
Regardless of the business model, the ultimate goal is to create synergy within organizations so that everyone works together. This is especially true with digitalization as it breaks down geographic barriers, allowing businesses to change, monitor and integrate technology from anywhere in the world.
For example, a retail company in Europe might decide to roll out a new mobile shopping experience on the continent. Instead of allowing branches in different countries to choose their own technologies, plans and processes, the retailer decides that it is better to have a common experience in all countries. Once the mobile platform is deployed, it must coordinate the various components between siled business units. It also needs a new investment management model, as each branch now invests in a co-funded operation instead of just being responsible for its own.
In addition, a mobile platform does not have a definitive end date. Instead, it’s a lasting asset that will last as long as you can make it work for you. The absence of clearly delineated end lines marks a complete shift from a project-driven model to a product-driven model where you can effectively manage business value streams.
However, it should be noted that switching to DPM is not as simple as changing labels. You can’t just morph project managers into product managers, or say that you once funded projects, but now fund products, while still using the same methodologies. The old one won’t do the trick at all! Instead, you will need to recognize that real change is needed.
In my next article, I’ll explain how DPM creates real change.