In today’s (omnichannel) economy, many traditional companies have huge IT & software departments servicing different business units. In addition, Shadow IT groups fueled directly by business leaders, loom large over these tech organizations. The goal for these groups is generally to innovate, bring new products and services to market, and improve existing processes. However, if not managed well, innovation can go wrong, and over time many companies end up with multiple and even redundant software apps, & products.
Compounding the problem, these products don’t look similar, are typically not designed to work together, collect similar data but treat it differently, use different technologies, and may solve similar problems in different ways.
Throw in organizational politics to the mix, and you have a messy, large swamp of products and data, instead of a well-defined, customer-focused, clean-cut portfolio of products. This situation is particularly acute when there is a mix of legacy systems, living side by side with born in the cloud-native applications.
Tech should be built to serve the customers. Navigating the swampy mess of apps and products, costs money, time, effort, and results in an inability to service customers optimally. As a result, both the company and its customers lose. The company could miss out on understanding its customers better, ignore key trends in the market, lose potential cross-selling opportunities, and much more.
→ This is a Business problem, masquerading as a Tech one
Here is a simple example that illustrates the problem and is applicable across all industries. Imagine a large retail bank, BigCo, which relies on its software products to track interactions with its customer base. Each channel that the customer uses to interact with the bank (think mobile banking, branches, ATMs, etc.) may use a separate application or product, or worse, use multiple applications. None of the applications share information with each other, although they track the same customer. As a result, the bank never gets a full picture of the customer or her needs. The bank ends up with a data & product swamp, misses out on cross-selling opportunities.
Further, from the customer’s perspective, the usability features of the individual products or applications may all be very different, leading to poor user experience. In the end, it’s a lose-lose.
While almost comical in the absurdity of this situation, in reality, this is a hard problem to solve for BigCo, and it spans UX, engineering, marketing, and sales departments among others.
If we were to headline this problem and generalize it across all kinds of industries and companies, it would likely read something like this:
How should an IT org, or a software product company, coordinate the efforts of its various teams to ensure all of its products and services focus on the customer, have a similar look and feel, interoperate with one another and share data, while having a coherent andcoordinated go-to-market approach?
There could be more than one root cause
Before we look at solutions, let us look at some reasons why companies may not be able to solve this issue easily.
- Is there a clear mission for the teams/organization?
- Perhaps this a structural issue..Are there lines drawn between teams that prevent coordination?
- Timelines and deadlines preventing effective collaboration?
- Is it due to leadership issues?
In my experience, it could be all of the above, but I think the most significant obstacle to a coordinated product portfolio, where the products are all designed to work together, is a lack of structured incentives. IT and BU leaders are evaluated on the basis of their individual P&Ls and goals. UX and engineering teams are driven by deadlines for their own products. Further, in software companies, sales teams are commissioned on their individual quotas.
Most humans work according to incentives and will go through walls to meet them. The lack of cross-domain collaboration or the presence of teams building siloed products could be an indication that there is something missing in the way incentives are structured.
The obvious solution to this conundrum seems to be to fix the incentive problem, which is to tie a team’s success to the success of the overall solution. But, this is not as easy as it sounds. The next part of this article will focus on some solutions. Coming soon.
Do you agree? Have you encountered these issues? Please feel free to leave a comment.