Why is organisational culture so important topic for product leadership?

woman stressed at work
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In ’00, besides Silicon Valley, product management wasn’t a thing; in „Four Steps to the Epiphany” from 2005, this concept wasn’t even mentioned. In ’10, thanks to the mainstream success of „Lean Startup” and the explosion of the startup scene, people started to talk about unique specifics to creating new products in a startup or digital enviroment.

Software ate the world, and we learned how to „eat it” effectively during this time. In 2023, know-how, guidelines and frameworks for building amazing digital products are easily accessible, democratising creating delightful experiences worldwide. There are plenty of resources like dozens of books, helpful communities or dedicated online courses like a Reforge or Maven.

So taking all of this into account, why are even competent & wealthy companies struggling with consistency in innovation and proper product management?

Workers, artists and something in between

Organisations & especially leadership, have difficulties in managing creative builders – multidisciplinary product teams, especially at scale when micromanagement isn’t a viable option. On the one hand, they are workers paid for each hour of their work & judged by the quantity of their output. Still, on the other hand, they are artists who work in a nonlinear fashion transforming their empathy & passion into extraordinary experiences for other people.

Treating product teams like workers will incentivise creating as much output as possible. This isn’t a winning strategy in an oversaturated market with multiple active competitors.

Approaching product teams as artists by giving them complete freedom in creation is unsustainable, as businesses need to generate predictable revenue.

So what is left is a hybrid solution combining these two approaches. Leadership provides product teams right objectives (structured, desired, clearly communicated, and up-to-date outcomes), which adds an abstract layer to workers’ outputs, and maintains the right environment (empowering teams, optimal organisational culture, financial incentives like ESOP), which is artistic freedom but put in some boundaries.

The problem with the hybrid approach is that it is unstable & needs constant adjustments. It’s susceptible to external, i.e. changing market trends or disrupting technologies, and internal challenges, i.e. management changes or strategies adjustments.

A good thing for companies’ leadership is that they have nearly everything under their control and can adjust businesses’ objectives and environment as they see fit. Only one thing in this hybrid puzzle is outside their direct control, and as we know from the theory of constraints, this means that it is the most important part of the puzzle. It’s the organisation’s culture, which can be only influenced but not directly controlled.

Eat that frog

In other words, the most long-lasting and constant factor for the performance of the product part of the organisation is nearly impossible to manage. So as the leader in a scaling product lead organisation, you need to look that frog in the eyes and eat it as fast as possible. Organisation culture influencing the way how your organisation work is already here.

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