Every year, organizational structures and business models remain a hot topic of discussion, with renewed focus and emphasis on how organizations are structured.
The new year is right around the corner, and with it comes several changes, including working together as cohesive teams, robust project management tools, and more agility.
While several proposed organizational models and team structures exist, what if the simplest and most effective way to organize and structure an organization has yet to be discovered?
This article explores product-based organizational models and why they are more effective than any other approach. First, let’s take a look at the benefits of product organization structure!
Product-based Organizational Structure Benefits
1. Greater Visibility of the Total Organization Through a Single Product Lens
Product-based organizational structures provide a more holistic, clear, and accurate view of the organization and its product portfolio. This can help ensure that goals, objectives, and partnerships are aligned to support the overall business strategy by offering greater visibility across the enterprise.
The organization can work with one product at a time, which allows for a more simplified product-to-market approach and can help ensure that the organization is fully delivering on its promise. Organizations must know the product manager interview questions!
2. Improved Communication Across the Organization
Focus is more clearly defined around each product as each product will be viewed through a single lens. While stakeholders may view this as an improvement in visibility, there may be negative impacts on communication across the organization.
Increased transparency is associated with increased risk, and the organization may be overwhelmed with information.
Product-based organizational structures can improve communication, but communication within and across product lines will significantly benefit companies when implementing a product-based organizational structure.
3. Improved Productivity through Better Communication
Product-based organizational structures also provide greater visibility of potential improvements to the organization. This allows for better communication between teams and stakeholders as they can identify areas where they are not fulfilling their respective goals or objectives.
The structure works hand-in-hand with corporate objectives and can help improve productivity due to the organization’s ability to identify inefficiencies more easily and align resources with goals.
4. Improved Management and Leadership
Leaders with clear visibility of the organization will be able to manage it more effectively. Leadership is simplified in a product-based organizational structure, as each product is handled through a single lens.
5. More flexibility:
A product manager is on a product team in charge of a product with a single customer. One can address the requirements of different product bases by creating cross-functional teams who report to the product manager. One can think about it as how a small company operates. Any team is relatively small, and all work together to achieve the common goal: survival (or fulfilling the customer’s demand).
6. Products to market faster:
One example of this is when Dell launches a new laptop. The marketing team, the design team, and the manufacturing team all need to work together.
Now with one product manager on one product, the entire marketing department has to continue to market that product for months before it launches. With a product-based organizational structure, communication can be done early on and will have less overhead as a single person handles each product. Marketing for one product can be done at once, making it a faster time to market.
Is Product Organization Right For Your Business?
A product-based organization architecture makes it easy to work with multiple products because each product has a team that can focus on specific goals. This structure is great for companies with various related products, such as fashion brands with different clothing and shoe styles.
When multiple products are within the same industry, having a product-based organization model will help ensure the products from one company align with those from another.
Product-based organizations successfully create organizational structures that are easy to manage and can be easily transferred to other business operations.
Product-based organization structures are simple but effective, as they eliminate the need for each product team to overlap in terms of purpose and strategy. Product-based organizational models will allow companies to better align their products with their customers’ needs and strategies, providing a simpler way for businesses to market and purchase products.
For example, if a company has two different software products, having two separate teams for each product will make it easier for the organization to create cohesive strategies and marketing plans for each product. This helps companies a great deal as they strive to balance the needs of their customers with those of their internal teams.
While there are many different organizational structures in business today, few are as simple and effective as the product-based structure.
Wrapping up!
Product-based organizational structures provide a more holistic, clear, and accurate view of the organization and its product portfolio. This can help ensure that goals, objectives, and partnerships are aligned to support the overall business strategy by offering greater visibility across the enterprise.
The organization can work with one product at a time, which allows for a more simplified product-to-market approach and can help ensure that the organization is fully delivering on its promise. Communication is improved as the focus is more clearly defined around each product, as each product will be viewed through a single lens.
