For many IT companies, the classic credo “The customer is king” applies. This often means that these companies are constantly trying to optimize their productivity or the quality of their IT products. However, in addition to fast and good delivery conditions, the nature of the offer should not be disregarded. For the success of the IT company, it is first and foremost a matter of reacting correctly to the customer. This means knowing the needs and needs of your own target group and responding to them in a targeted manner. In order to realize this, one thing is needed above all: an efficient IT product organization.

With the widespread and growing understanding of agility and the ever-increasing implementation of agile strategies,many IT companies have already recognized the importance and benefits of an IT product organization. But even for those companies that are just beginning to think about introducing such an IT product organization or an agile product culture, there are still many benefits. Based on best practices from other companies, a standard scheme for the optimal implementation of an IT product organization has developed in recent years.

If you would like to learn more about agile products and agility in companies, please read on the following articles from me:

What does “IT production organization” actually mean?

Nice and good the theory you might think now! But what is the term actually about? So before this article outlines ways of integrating, I would like to begin by understanding the value of an IT product organization.

The importance of an IT production organization

Many companies have departments with a focus on product management. Often, however, these are only small or even not even linked to the IT department. While the latter are kept flexible by implementing agile methods such as Scrum and are primarily considered a support department, it usually has little impact on product culture within the organization. Many companies even do without the management of a product culture and rely instead on project management in these matters.

This often results in companies assuming that they are customer-oriented, but realistically they implement this in a much more limited way than possible and are necessary for the success of the company. The reasons for such behavior range from top-down objectives to areas such as cost reduction through data-based decisions regarding value creation or market development.

Although many IT companies recognize the profitability of agile methods and have them promoted and expanded within the IT department in the company, the distance of this department to product management often leads to a weakening of these measures in the field of IT production organization. Instead, extra-employed product managers are given the task of managing the customer. They try to analyze and derive customer requirements in the form of resource management. As a result, the development of products depends solely on the availability of resources. Accordingly, it is less oriented towards the customer itself.

How does an IT production organization define itself?

An optimal IT product organization focuses primarily on the wishes of customers. It focuses on being able to constantly understand the customer’s requirements. But also which new products he would like or which one he would accept. With the inclusion of these parameters, therefore, an IT product organization is all about the product itself. Aspects such as customer benefits or user experience contribute significantly to the success of the company.

Basically, an IT product organization is divided into two important roles:

  • the Chief Information Officer and
  • Chief Technical Officer/ Vice President Product Development/ VP Engineering

The Chief Information Officer acts as head of the IT organization. The Chief Technical Officer/ Vice President Product Development/ VP Engineering, on the other hand, has the actual product development organization to task.

This makes the IT product organization significantly different from the traditional product organization. The latter usually implements three roles in product development, product management and design, and marketing.

Build an IT product organization

For the optimal and efficient development of an IT product organization, companies should follow these steps:

  1. Structure the distribution of tasks

Companies should first bring an order and a structure into the distribution of tasks within the company. This is strongly based on the introduction of new organizational models that are committed to more effective execution of processes in terms of customer requirements.

2. Introduce roles and their descriptions

In addition, roles such as Chief Information Officer and Chief Technical Officer/ Vice President Product Development/ VP Engineering should be introduced and their tasks and duties carefully identified. This role structure allows better use of competences and clear demarcations.

3. Defining areas of responsibility

With regard to the different roles, however, the areas of responsibility should also be clearly defined and defined. If each of your employees knows which area they are responsible for within the It product organization and what authority they have, their internal performance can be significantly increased.

4. Link T-Department with product management and culture

Finally, companies must ensure that the wall between the IT department and the product organization is kept permeable, transparent and communicative, so that an agile product culture based on customer requirements can also be developed across departments.

Conclusion

By implementing an IT product organization, a company can increase its overall agility. At the same time, however, it can also respond to customer requirements much more efficiently. Defining roles and their responsibilities can also encourage the motivation of the workforce. dThis is due to the fact that tasks and objectives are clearly defined.

Even if the implementation of an IT product organization sounds comparatively simple, there are many pitfalls. IT companies should therefore focus in particular on the following areas:

  • Cooperation with the customer: Only those who work with and close to the customer can really understand their wishes, requirements and the benefits of a product.
  • Budget for obtaining information should be spent sensibly so as not to analyze the actual customer claim and to draw false conclusions.
  • Roles and their tasks cannot be transferred to every employee. Choose from your workforce those whose character and competencies suit their roles and who have an understanding of customer demands and a desire to solve problems.
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I blog about the impact of digitalization on our working environment. For this purpose, I present content from science in a practical way and show helpful tips from my everyday work. I am a manager in an SME myself and I wrote my doctoral thesis at the University of Erlangen-Nuremberg at the chair of IT Management.

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