Building useful digital products and meeting market needs in a legacy organization requires strong general management, not just good design. While the digital economy has changed the game, legacy companies can draw upon their strengths to develop successful digital products. Here are my observations on mistakes legacy organizations make and how to leverage their strengths to develop useful digital products.
Legacy organizations must ask themselves: What does the customer actually want?
When thinking about ”digital”, legacy organizations make the mistake of focusing on specific technology or distribution channels. I often hear, “we need to build an app” or “we need to be on snapchat”. Instead, organizations need to stay true to the strategy that made them a successful to begin with: fulfilling a market need while keeping their customers satisfied. Just like their predecessors who built the organization, product development succeeds when you stay focused on customer needs and let that drive decisions.
Poor incentive structure causes poor design
Many managers take the easy route, knowing leadership will reward them for building something pretty. For example: a responsive website or glossy app that looks good but doesn’t address key market needs. Or, hiring a social media manager that produces buckets of content but does not engage on topics that drive growth. At best these are small aesthetic steps forward and at worst they distract resources as well as mask major issues. Digital product development meetings should never start with product managers describing how they wanted the product to “look” before addressing core needs.
Tough Organizational Changes
Customer centric digital product development requires more than just mapping core needs to features, in fact that is the easy part. Customer centric digital product development requires organizational changes, tough ones. Specifically:
- Culture/Process: Most legacy content organizations operate on a weekly, monthly, yearly schedule that drives product development and marketing. This assumes that mistakes cannot be make and the first version in market is the last version. Cultural change has to match agile development with agile marketing. The whole organization has to product content in step.
- Technology: Many legacy companies outsource what should be core competency. If data is your core asset, do not license core workflow tools or hire vendors to build them.
- Incentive Structure: Don’t fire people for making mistakes. Fire people for releasing products that customers don’t need or want.
Digital transformation really means complete transformation
Digital transformation requires genuine and tough changes to culture, incentive structure, and talent. Furthermore, a transformation requires a strong management team making difficult decisions. Let’s be clear: strategy is vital but most legacy organizations have a legacy because they built an organization around core customer needs already. Digital has changed those customer needs but staying customer centric needs to remain the strategy. Next comes the difficult execution issue that revolves around the difficult decisions of who to hire, who to let go, who to partner with, and how to utilize new talent. This needs to be lead from above.