New research is challenging the traditional top-down, command-and-control, project-focused management system that has dominated business practices for decades. Planview found that in “elite organizations” (those that meet quarterly business objectives more than 90% of the time), half of the work is done using a product-led operating model. Meanwhile, in low-performing organizations, 75% of work is still project-based.
This product-oriented approach—which is defined by agility, continuous delivery, and outcome-based decision making —is not only transforming internal performance. Research has shown that these companies see shareholder returns up to 60% higher than those of their underperforming peers. However, adapting to this new mode of operations is no easy feat.
To achieve the transformation to a product-oriented model, organizations need to rethink every aspect of the business, from planning through delivery. The success of such a transformation requires fundamental changes to budgeting, team structures, processes, how technology is leveraged, and the definition of success.
Also Read: How DevOps Compacts the Software Development Lifecycle
Delivering Value Continuously to Customers
For decades, businesses have operated within a hierarchical structure, where decisions flowed from the top down, and success was often measured through rigid performance metrics and defined milestones. While this model worked in a more predictable world, today’s rapidly changing markets demand more flexibility, faster response times, and the ability to adapt quickly.
The product-oriented model is focused on continuously delivering value to customers, with a mindset centered around iterative improvement, customer feedback, and cross-functional collaboration. In this model, the definition of success is no longer driven by individual department objectives but by the collective impact of all teams working toward shared product goals.
In 2024, Planview found that 50% of elite organizations surveyed have developed an enterprise-wide operating model that aligns project-based planning with product-based funding, which is over twice as many as the lowest performers. This approach requires businesses to think about ongoing product evolution rather than one-time product launches, placing value on the ability to iterate quickly and deliver improvements in real time. It helps businesses avoid the stalled progress that can come with traditional project lifecycles and, instead, leverage ongoing product development to stay in sync with market demands.
Challenging the Status Quo and Disrupting Industries
Digital-first companies have disrupted industries by challenging the status quo and revolutionizing markets with speed, innovation, and customer-centricity. What sets them apart is their ability to embrace agility at their core—whether in development, organizational structure, or product offerings. For digital natives, agility isn’t just a strategy; it’s a fundamental part of their DNA.
Companies like Amazon, Uber, and Netflix were designed to be agile from the outset. They were designed to challenge the status quo and revolutionize their markets. These companies work with fast feedback loops, where teams experiment, learn, and improve products on a continual basis, rather than following a rigid, linear process. As a result, they can respond to customer needs quickly, optimize product features, and pivot direction with minimal friction. This positions them as industry leaders and drivers of innovation with highly engaged, brand-loyal customers.
By embracing continuous delivery, they have fundamentally changed how we think about doing business and the speed at which a company must evolve to remain competitive. But agility is not just for newcomers. Established companies, too, can learn to thrive by taking pages out of the disruptor playbook. Legacy companies that embrace the start-up mindset see improved operational efficiency and achieve significantly better financial growth. Companies that get it right report increased flexibility, innovation, and customer satisfaction.
Research supports this as studies show that organizations embracing continuous delivery and agile frameworks consistently outperform their more traditional counterparts; those that achieve a highly successful agile transformation are three times more likely to be top-quartile performers than their competitors that have not transformed.
Also Read: Ensuring High Availability in a Multi-Cloud Environment: Lessons from the CrowdStrike Outage
Elements of a Product-Oriented Operating Model
To thrive in today’s market, businesses, old and new, must adopt the mindset that has worked for digital natives. By introducing product-oriented thinking into their structures, these companies can improve cross-functional collaboration, speed up their time-to-market, and better respond to customer needs.
Still, adopting a product-oriented approach impacts every level of an organization and expands throughout an entire portfolio. From foundational elements like budgeting and resource allocation to daily operations, businesses must be prepared for significant shifts that include:
Budgeting and resource allocation practices. In a product-oriented model, resources are allocated to persistent teams rather than temporary project initiatives. Traditional budgeting methods, which require thorough domain knowledge focused among a core group of strategic planners, are replaced by flexible team-based methods which allow for continuous adjustments. Agile financial planning ensures that funds are directed where they can have the most impact on delivering value to customers.
Team structures and collaboration processes. The rigid, siloed teams of traditional models give way to cross-functional teams that focus on specific customer-facing value, or providing cross-cutting or platform services which serve multiple customer sets at once. These teams work collaboratively, sharing insights and feedback to improve the product iteratively. Agile practices encourage team autonomy, allowing product teams to make decisions quickly without waiting for top-down approval.
Methodologies and delivery. Traditional project management methodologies can be slow and cumbersome, making it difficult for organizations to keep up with fast-changing market conditions. The product-oriented model requires agile processes, such as Scrum or Kanban, that enable continuous improvement and faster delivery of product increments. This accelerates time-to-market and allows businesses to respond to customer needs with greater flexibility.
Technology and tools. Organizations must adopt the right technology stack to support continuous delivery and product-oriented thinking. This means integrating systems that enable real-time feedback, collaboration, and agile workflows. With the right tools, teams can track product performance, manage resources effectively, and implement changes quickly without disrupting the overall business.
Their definitions of success. In a product-oriented organization, success is no longer solely measured by traditional KPIs or outputs. Instead, success is measured by the value delivered to customers, the ability to adapt quickly to feedback, and the impact of product changes on business outcomes.
This shift requires extensive organizational changes, but the benefits are clear: businesses that embrace agility and a product-oriented mindset will be better positioned for long-term success and growth in the digital age.
Also Read: The Arbitrage Opportunity of Small Language Models: Unlocking AI Efficiency and Performance
Achieving Success Through Product-Oriented Thinking
Adopting a product-oriented operating model can transform any organization, no matter how long it has been operating. Shifting from a traditional, top-down management structure to one that prioritizes agility, and continuous delivery enables businesses to thrive in today’s ever-changing marketplace.
As disruptors continue to impact industries with their agile, product-focused mindset, established companies must learn to adapt or risk falling behind. By embracing a product-oriented approach, organizations are improving their ability to innovate and deliver value and ensuring that they can meet customer expectations and navigate market disruption with greater agility.
