Organizational Structure and Productization Lecture 17 Sjaak Brinkkemper Garm Lucassen 1 Juni 2017 Outline Organizational growth and structures Positioning the product manager ID: 782155
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Slide1
Software Product ManagementOrganizational Structure and Productization
Lecture 17
Sjaak
Brinkkemper
Garm
Lucassen
1
Juni
2017
Slide2Slide3OutlineOrganizational growth and structuresPositioning the product managerProductization from a service firm to a product business
Slide4Growth phases
Size
Large
Small
Age of the organisation
Young
Grown
Phase 1
Startup
Phase 2
Survival
Phase 3
Success
Phase 4
Expansion
Phase 5
Optimal
From: Churchill, N.C. en V.L. Lewis (1983), The five stages of small business growth, Harvard Business review, May-June, pp 30-50.
Slide5Characteristics of phasesStartup: first release, first customers, arranging companySurvival: second release, getting more customers, hiring first employee, create cashflow
Success
: more customers, exposure in market
Expansion
: redefining the company, hiring personnel, internationalization, company exit strategy
Optimal
: customer satisfaction
Most
startups
Fosbury
,
Nubiko
, EitriAFAS, Quinity, Mendix
Planon, TomTomExact, Unit4
Slide66Structuring an organization
Slide77Structuring an organization
Slide88Structuring an organization
Slide9Baan R&D DepartmentProductManagementRelease
Management
Processes
Finance/Legal
HRM
Common
Architecture
Research
BaanTech
Workflow
Common
Technologies
ERP
Service&
Project
E-ERPBackOfficeApplications
Financials
CRMSupply ChainApplicationIntegration
EmergingApplications
ConfigurationManagementProduct TestingMulti-Byte
ProductAssemblyDocumentationand Training
Business
Intelligence
Localizations
Product
Delivery
Chief Technology
Officer
The organizational structure of Baan
R&D Department in
1998; 1500 employees
Acquisitions
Slide10Organizational structuresOrganizational structures are needed becauseGrowing organisations need functional specialistsManagement has limits in numbersCategories:F:
Functional
HRM, Development, Sales, Marketing, …
P
:
Product
ERP, Middleware, BIS, Localizations, …
M
:
Market
Large accounts, SME, Public, Banking and Insurers, …
G: GeograficBenelux, Nordic, UK, France, …
Slide11Standard F-structureBoardR&DMarketing
Sales
Services
Support
Slide12Investments and profitsBoardR&D
Marketing
Sales
Services
Support
-
-
+
+
+
S
-
S
+
Profit:
Slide13SubstructuresBoardR&DMarketing
Sales
Services
Support
P-structure
Generic,
P-structure
P-structure
P-structure
P-structure
G-structure
M-structure
Slide14P-type for R&DR&D departments are responsible for a product lineProduct Management: Functional responsibilityLiaison with MarketingArchitecture BoardTechnical responsibility
Interfacing of products
R&D
mgr
Product 1
Product 2
Product 3
Product 4
Architecture
Board
Product
Management
Slide15DiscussionWhat is the stage of your assignment company?Do you have insight in their organizational structure?
Slide16OutlineOrganizational growth and structuresPositioning the product managerProductization from a service firm to a product business
Slide17Position product managementThe positioning of Product Management determinesResponsibilitiesActivitiesExternal and internal communicationsFive
positioning scenarios
Within R&D: as overall function
When functional integration of products is essential
Within R&D: inside product development teams
When products are relatively independent
Within Marketing
When customer value and market presence are important
Partly within Marketing and partly within R&D
When customers have complex technical requirements
Under the Board
When CEO/CTO are heavily involved in product functionality
Slide18Organizational variabilityBoardR&D
Marketing
Sales
Services
Support
Product 1
Product 2
Product 3
Quality
& Delivery
Product
Management
Product
Management
MarketingCommunication
ProductManagementProduct
ManagementProductManagementProductManagement
Slide19DiscussionWhat is the position of the product manager in your assignment company?
Slide20OutlineOrganizational growth and structuresPositioning the product managerProductization from a service firm to a product business
Slide21Introduction on ProductizationProductization: from project/customer driven to product/market driven businessIT Service firms have difficulty managing product businessProject: billable hours, project acquisitionProduct: market share, next release launchSpin-off of Acision
from
Logica
Earlier
study
Productization
from
within
one company (Artz et al. 2010)Research questionTo what extent is the productization process applicable in an IT service firm when transforming from developing customer specific software solutions to standard product software for a market?
Slide22Generic view on productization
Slide23Towards product organization
Customized Standardized
Product Organization
No Product Organization
Slide24Research approachInvitation by IT service companyCase study: theory testing 7 products selected from candidate setLiterature backgroundSemi-structured interviewingDetermination of initial positionGap analysis
Advise
to
case
study
firm
Overall
findings
Slide25Productization processIndependent projectsReuse across projectsProduct recognitionProduct basisProduct platforma. Customizable product (enterprise solution)b. Standard product (packaged mass-market)
Artz
et al (2010)
Slide26Two end stages:For some software there is a need for customization in order to integrate software in a customer-specific situation Aspects of productization (Hietala
et al., 2004)
- Product market
- Concepts
- Benefits
- Positioning
- Selling
- Marketing
Productization
Process 2/2
adopted from Hoch et al., 1999
Degree of standardization
Slide27Literature: Dimensions of Productization
Slide28Focus dimensionsDimensionsCustomized software
Standard software
Software
Customized software project
Standard software product
Business focus
Meeting the customer needs within budget and time, contractual fulfillment
Gaining market share
Requirements gathering
Gathered from one customer
Gathered from whole market
Requirements selection
Select requirements per project (More or less fixed list of requirements)
Optical selected subset of requirements
Marketing goals
Interaction, relationship and networks
Product, price, place and promotion (4P’s), branding and differentiation
Software development philosophyWaterfallSCRUM agile development
LifecycleOne release, then maintenanceSeveral releases based on market requirements
Development teamsProject focused, people are assigned to multiple projectsProduct-focused, self-managed, Involved in the entire development cycle
Stakeholder involvementHigh external, barely internalHigh internal, low external
Slide29Productization processIndependent projectsReuse across projectsProduct recognitionProduct basisProduct platforma. Customizable product (enterprise solution)b. Standard product (packaged mass-market)
Artz
et al (2010)
Slide30Stage 1: Independent projectsIndependent relations between projects.Projects differ in budget, technology, and functionalitySoftwareCustom features
Software
Custom features
Customer Project
2
Software
Custom features
Maintenance
Software
Custom features
Maintenance
Maintenance
Maintenance
Customer Project
4
Project PortfolioDelivery
DeliveryDeliveryDeliveryRequirements Engineering
Requirements EngineeringRequirements EngineeringRequirements Engineering
Customer Project 1Customer Project 3
Slide31Stage 2: Reuse across projectsFocus on feature reuse across projectsMore custom than standardSoftwareCustom features
Software
Custom features
Software
Custom features
Software
Custom features
Maintenance
Maintenance
Maintenance
Customer Project
4
Delivery
Delivery
DeliveryCustomer Project 2
Standard featuresStandard features
Standard featuresCustomer Project 4Project Portfolio
MaintenanceDelivery
Customer Project 1Customer Project 3Standard featuresRequirements Engineering
Requirements EngineeringRequirements Engineering
Requirements Engineering
Slide32Stage 3: Product recognition Shared features between projectsMore standard than customIntroduction of portfolio managementSoftwareStandard features
Software
Standard features
Customer Project
2
Software
Standard features
Maintenance
Software
Standard features
Maintenance
Customer Project
1
Maintenance
MaintenanceCustomer Project 4
Customer Project 3Custom features
Custom featuresCustom featuresCustom features
DeliveryDeliveryDeliveryDelivery
Product PortfolioRequirementsEngineeringRequirementsEngineering
RequirementsEngineeringRequirementsEngineeringPortfolio management
Slide33Stage 4: Product basisGeneric product platformIntroduction of product roadmappingCustomer specific maintenance
Software
Standard features
Software
Standard features
Customer Project
2
Software
Standard features
Maintenance
Software
Standard features
Maintenance
Customer Project 1
MaintenanceMaintenance
Customer Project 4Customer Project 3
Custom featuresCustom featuresCustom featuresCustom features
Product RoadmappingDelivery
DeliveryDeliveryDeliveryRequirements
EngineeringRequirementsEngineeringRequirementsEngineering
Requirements EngineeringProduct Portfolio
Portfolio management
Slide34Stage 5: Product platformIncreasing generic product platformIntroduction of requirements managementRequirements gathering based on market trendsEvent based customized releases per customer
Software
Standard features
Product Roadmapping
Software
Standard features
Customer Project
2
Software
Standard features
Releases
Software
Standard features
Releases
Customer RequirementsCustomer Project 1Releases
ReleasesCustomer Project 4Customer Project 3
Custom featuresCustom features
Custom featuresCustom features
DeliveryDelivery
DeliveryDeliveryDelivery
Product Portfolio
Requirements
Management
Portfolio management
Customer
Requirements
Customer
Requirements
Customer
Requirements
Slide35Stage 6a: Customizable product software One standard product with small additional customized layerIntroduction of release planningStructured standardized releasesCustomer requests are handled as market requirements Product software aiming at selling services
Software
Standard features
Software
Standard features
Customer Project
2
Software
Standard features
Software
Standard features
Customer Project
1
Customer Project
4
Customer Project
3Custom featuresReleasesReleasesReleases
ReleasesProduct Roadmapping
Launch & deliveryLaunch & delivery
Launch & deliveryLaunch & deliveryCustom features
Custom featuresCustom features
Release Planning
Product Portfolio
Requirements
Management
Portfolio management
MarketRequirements
Market Requirements
Market Requirements
Market Requirements
Slide36Stage 6b: Standard productOne generic product for all customers and build for a specific marketIntroduction of release planningStructured standardized releasesSoftware is completely configurableProduct software aiming at selling licenses
Releases
Releases
Releases
Releases
Product
Standard features
Customer Project
2
Product
Standard features
Product
Standard features
Customer Project
1
Customer Project
4Customer Project 3Market Product
ProductStandard featuresLaunch & delivery
Launch & deliveryLaunch & deliveryLaunch & delivery
Requirements Management
Release Planning
Product Portfolio
Portfolio management
Product Roadmapping
Market Requirements
Market Requirements
Market Requirements
Market Requirements
Slide37Case studies 7 theory testing case studies Varying intervieweesService perspective (project mgr, delivery mgr)Potential productsMarket sector
Product A
Telecom market
Product B
Telecom, Transport and Utility
Product C
Local government
Product D
Utility firms
Product E
Oil Companies
Product FLocal government
Product GLocal government
Slide38SPM Maturity MatrixFocus area0
1
2
3
4
5
6
7
8
9
10
Portfolio management
Market analysis
A B
CD
EPartnering & contracting
A
B
C
D
E
Product lifecycle management
A
B
C
D
E
Product planning
Roadmap intelligence
A
B
C
D
E
Core asset roadmapping
A
B
C
D
Product roadmapping
A
B
C
D
E
Release planning
Requirements prioritization
A
B
C
D
E
Release definition
A
B
C
D
E
Release definition validation
A
B
C
Scope change management
A
B
C
D
Build validation
A
B
C
Launch preparation
A
B
C
D
E
F
Requirements management
Requirements gathering
A
B
C
D
E
F
Requirements identification
A
B
C
D
Requirements organizing
A
B
C
Maturity resultsFocus areaAdvanced (2)Emerging (5)Avg(%)
Portfolio management
21,9
14,2
16,4
Product
planning
19,3
15,3
16,5
Release
planning
45,624,730,7Requirements management41,722
27,6
Slide40DiscussionLanguage and vocabulary problems due to service versus product perspectiveSPM maturity assessment interpreted differently: make SPM more SMARTService firm finds Productization difficult due to different business model and cultureFocus on IP creation and buy-out
Slide41ConclusionsValidation of productization process Immaturity of product business inside a service businessMany advises for service company to arrange product teamsBut then the IT service firm got acquired …
Slide42Questions?