By Marty Cagan · svpg.com · LinkedIn
Marty Cagan argues that a common reason transformation efforts fail is structural: large management consultancies and IT outsourcing firms are poorly positioned to drive a shift to the product model. Their people are usually capable, but their institutional and financial incentives conflict with the change. Like asking a fossil fuel company to lead an energy transition, these firms would have to act against their own business interests, and stakeholders who hired them would lose influence. Companies therefore need to own the transformation internally, while they can still recruit individual talent from these firms if they bring in experienced product leaders.
01Key takeaways
- Failed transformations often stem from structural conflicts of interest, not poor talent.
- Don't rely on consultancies or outsourcers to dismantle the need for their own services.
- Transforming to the product model requires changes beyond decision-making and team staffing, and leadership must own them.
- You can still hire strong individuals from consultancies and outsourcing firms.
- Pair hired talent with someone who has real experience in the product model.
02Key sections
- The puzzle of failed transformations
- Cagan notes that consultancy people are typically smart and clients pay heavily, so talent and money aren't the explanation. He proposes the problem is structural.
- The fossil fuel analogy
- A utility asking fossil fuel companies to lead its shift to renewables illustrates how advisors will act against their own institutional interests.
- Consultants and stakeholder decisions
- Management consultants hired by stakeholders are unlikely to recommend changes that reduce those stakeholders' power, which the product model requires.
- Outsourcing firms face the same conflict
- Bringing outsourced engineering in-house threatens the outsourcing firm's business, so they won't advocate for it.
- Own the change, hire the talent
- Transformation is the company's responsibility, but individuals from these firms can be hired if guided by experienced product people.
03From the post
“A partnership dedicated to teaching best practices to product teams and product leaders”
Summary and takeaways written by PM Atlas; quotes are short excerpts. © the original author.