To Make Digital Transformation Real, Shift from a Project to a Product Focus

By Jason Bloomberg   •   May 17, 2018

Guest post by Jason Bloomberg, of Intellyx LL.

Our fellow pundits love broad proclamations like ‘software is eating the world' or ‘every company is becoming a software company.'

For those tech-savvy enterprises that have been leveraging mission-critical software to deliver customer value for decades, such a transformation is relatively easy to understand – and furthermore, they may already be well on their way to their own digital nirvana.

In the more general case, however, the products that an enterprise sells to its customers are quite separate from the role that software plays within the organization.

For such companies in particular, IT has long been a cost center, playing an essential but secondary support role to the product teams in the lines of business, who have always been responsible for customer value.

The Long Road to Product-Centricity

It's true that the rise of the Web over two decades ago placed enterprise software directly into the hands of customers in the form of corporate Web sites, which evolved over time into more complex Web applications and finally, mobile apps.

But for those companies whose products have never truly been software-centric, such customer-facing technology has consisted of marketing-driven projects, not products in their own right. Websites for packaged goods products are familiar B2C examples. In the B2B space, commercial real estate websites are far more common than digital property management solutions, for example.

At the same time, these organizations' IT departments have largely worked in their own separate silos, running software projects in traditional, waterfall-centric, high risk ways.

Today, digital transformation is changing the entire context for such companies. Even the most traditional enterprises are finding that software is becoming an essential component of the products they sell, if not products themselves.

This product-centricity is one important aspect of the disruptive change that digital transformation is bringing to enterprise IT shops. For such shops – especially the application development group – the shift from project to product-centricity is a critically important, but rarely discussed aspect of the DevOps cultural shift.

Products across the Digital Journey

For the digitally transformed enterprise, a product is far more than simply the ‘widget on the shelf.' Such companies focus on delighting customers across the entire digital journey, where interactions with the proverbial widget (aka, a physical product) is but a subset of all the interactions or ‘digital moments' that make up such journeys.

Take, for example, the cosmetic company Sephora, whose mobile app case study recently appeared in AdWeek. Sephora is not only offering customers an opportunity to purchase products via their mobile app, but also the ability to explore and learn about new products in a personalized fashion.

Sephora's app uses a combination of artificial intelligence and augmented reality  to show customers how different products will actually look on them. The company reports that the strategy is working, as Sephora customers have tried on hundreds of millions of shades during almost ten million visits to the Sephora Virtual Artist feature in the stores.

Another example is Home Depot. The home improvement retailer is now offering a customized shopping experience via its mobile app, which uses context-sensitive targeting to help customers shop in real-time by providing location-specific information and recommendations.

The products such firms bring to market consist of all the elements of such digital journeys, from the physical product itself to the marketing, web site, mobile presence, call center, warranty support, and upsell/cross-sell interactions that make up the journey.

All of these journey elements make up the product, regardless of whether a particular interaction is software-based or not. Splitting off the software bits of this story from the overall product context, therefore, shortchanges the customer experience – ringing the death knell for any digital effort.

Understanding Product-Centric Testing

One fundamental difference between a product-centric and project-centric approach is how an organization handles testing.

In the traditional software world, testing is part of the application lifecycle. Waterfall methodologies put it at the end while Agile approaches bring it earlier, and DevOps strives for continuous testing across the lifecycle.

All of these approaches, however, are still project-centric, where projects correspond generally to one or more application lifecycles.

Contrast this software context for testing with the way product teams handle testing.

Let's say you have a new or improved widget you want to put on retailers' shelves. The tests you might run include putting one or more versions of your widget on a few stores' shelves in different geographies for a set time period.

After the test (or increasingly, while the test is running), you crunch the numbers to determine which combinations of features, prices, shelf locations, etc., maximize the profitability of the product across different stores in different geographies.

In other words, such testers leverage feature management, an essential aspect of such product testing within the context of all of the merchandising options available to the product team.

Bringing Product-Centric Testing to Digital Efforts

Let's take this product-centric approach to testing to a digital product consisting of both software and non-software elements that customers interact with along a digital journey.

We may, for example, have different versions of a web site, perhaps showing different physical products, that we roll out to different customer segments. Such testing takes place ‘in production' (the software world's phrase for ‘in front of customers') and covers any or all interaction points with the audience of current and prospective customers.

A simple example of this approach is what we call ‘A/B testing,' where, for example, we simultaneously publish two versions of a web page to see which version performs better in the marketplace.

The difference here, however, is that we're leveraging feature management across the entire customer journey, not simply two versions of a web page. Each feature may be as simple as an element of a web page or as complex as a structured interaction with a customer.

The Intellyx Take

Feature management from companies like LaunchDarkly can be an important part of more traditional project-based software efforts as well, of course. In fact, the more DevOps-centric the appdev culture becomes, the more important feature management is to achieving the goals of continuous testing.

For organizations undergoing digital transformation, however, feature management becomes an integral part of a product-centric approach to building digital journeys. It frees testing from traditional appdev constraints, giving greater power and control to diverse digital product teams who have responsibility for delighting the customer in the digital era.

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Originally published on March 29, 2018 here. Copyright ©Intellyx LLC. LaunchDarkly is an Intellyx client. At the time of writing, none of the other organizations mentioned in this article are Intellyx clients. Intellyx retains full editorial control over the content of this paper. Image credit:alainalele.