Have an agile mindset? Learn how to rewire your mind for a product mindset

A blog post by Manoj Mishra, managing director, Deloitte Consulting LLP

Over the past two decades, many organizations have shifted from a waterfall to an agile development approach for planning and delivery of their largest, most critical initiatives. However, a majority of these initiatives continue to be delivered as projects. As they have embraced agile, though, savvy organizations have also transitioned to a product-based mindset that has gained traction over the past few years, due in large part to Mik Kersten’s book, Project to Product.¹ The shift from project to product has enabled many of these companies to deliver better business outcomes.

Even though they’re compatible, the agile and product mindsets are different. While agile is an iterative approach to project management and software development, a product mindset views software development as a set of goals and outcomes—a product—rather than short-term milestones. Leaders who have typically led agile-based initiatives but want to transition to a product mindset often have questions such as:

• What is a product mindset? How is it different from an agile mindset?
• What do I need to do differently as we move to a product mindset?
• What kind of disruption will this cause?

Given that agile and product mindsets differ, there are nuances to each that leaders should be aware of and understand as they seek to answer these questions and use both approaches to build and deliver applications.

The agile mindset

Agile can mean different things to different people. However, the Agile Manifesto, created in 2001, has four values that mark agile development initiatives. The Agile Manifesto values:

• Individuals and interactions over processes and tools
• Working software over comprehensive documentation
• Customer collaboration over contract negotiation
• Responding to change over following a plan²

Teams that achieve excellent productivity and really represent an agile mindset also have a few common traits. They are:

• Respect for people and culture: Teamwork should begin with respect for fellow teammates, leadership, and organizational culture. When people are treated with respect, they are willing to improve, and they steer together toward better ways of working. They also welcome different perspectives, whether from within the team or outside.
• A focus on delivering outcomes: Productive agile teams focus on delivering value for the customer. They don’t care about metrics like number of user stories, velocity, etc. They take pride in their ability to deliver the best outcomes in the shortest possible time.
• Willingness to accept and adapt to change: When priorities change due to customer needs, and if the product manager’s priorities shift, these teams adapt quickly. They don’t get bogged down by arguments about prioritization, shifts in direction, etc. They know that customer satisfaction is typically the shortest path to success.
• Continuous improvement: The team and individuals are never satisfied. They look at failures as a learning and improvement opportunity, and they are always looking to improve.
• Collaboration: Agile team members collaborate and communicate. They have the urge to connect with other team members and self-manage. As teams work on solving complex problems and building increasingly complex systems, they recognize the benefits of collaborating with other parts of the organization and decreasing the number of handoffs necessary to meet their goals.
• Having fun: Teams thrive with high energy; high-energy people are motivated and they like spending time with each other. They have fun with each other. Their learning experiences and collaboration give a good team much to be happy about.
• Psychological safety: Highly agile teams allow individuals to try something new, speak their mind, and possibly fail in a safe environment. Individuals are not chastised for mistakes, but rather supported for taking risks and trying new things. Team members are also honest with each other, and when someone is struggling, other team members try to help or, if necessary, find another team where that person can succeed.

Evolving from agile to a product mindset

With its focus on customers and outcomes, the product mindset extends the agile mindset to develop a longer-term approach to delivering value for customers—prioritizing features, developing road maps, making data-driven decisions, focusing on outcomes rather than outputs, and delighting customers.

To evolve from agile to a product mindset, it’s crucial to rely on “muscle memory” from agile and to create new “muscles” as well. So, what new muscles should be built? The following five have emerged as most critical:

• Customer journey or value-centric approach: The culture across an organization should center around recognizing and respecting customers, both external and internal. Leaders should focus on building strong foundations around customer onboarding and offboarding, customer development, customer experience management, and customer delight.
• Funding and prioritization based on value streams and the customer journey: The product operating model should ideally map and manage the flow of customer value, from ideation to post-sale services. Value streams and customer journey maps are mechanisms that help execute business objectives by organizing value flows and providing feedback as part of the innovation and improvement process. However, mismanaged value streams can result in silos, excessive handoffs, and toil. Therefore, value stream owners should work closely with customers, product teams, and senior leadership to optimize outcomes, throughput, and quality.
• Closed feedback loop: It’s essential to create systemic processes that create a closed feedback loop that measures the impact delivered and ensures the results from delivered features are considered during the next product planning cycle. Closing the loop requires enablement platforms with real-time data to understand customer behaviors, product performance, and innovation opportunities.
• Minimize time to value: Shifting to a product mindset means focusing on time to value rather than time to market. Organizations often adopt an agile framework to improve time to market, but they may not see quick value delivery to the business. However, the fast-fail approach of agile, coupled with the focus on time to value of a product mindset, can be a potent combination to produce quick value delivery.
• Persistent, multi-skilled, self-organizing teams: Product teams should be persistent and stay involved and focused on the product road map. It’s not about accomplishing one goal or feature, but about finishing the journey. Persistent teams are also cross-functional. That means team members from both IT and the business are closely connected and in constant communication. Working cross-functionally minimizes the learning curve of new teams and can accelerate innovation.

Agile and product make a good combination

No two initiatives are the same, but there are some fundamental principles that can be applied to almost any of them. First, agile’s iterative approach can save development time and resources. Second, a product mindset helps teams focus more on outcomes and value delivery than on gates and milestones. Companies that take an agile approach, and evolve to couple that with product mindset, can build stronger teams and deliver better business outcomes.

¹ Mik Kersten, Project to Product: How to Survive and Thrive in the Age of Digital Disruption with the Flow Framework (Portland, OR: IT Revolution Press, 2018).

² Taken from the “Agile Manifesto,” accessed July 11, 2022.