Welcome to the second blog in our series on transitioning to the Product-Led Operating Model (PLOM). In the first installment, we discussed the strategic imperative for organizations to adopt PLOM, and why traditional operating models may no longer serve the fast-paced, customer-driven market. If you missed it, you can read it here.

In this blog, we take a deep dive into the 4Rs — Reinvent organizational design, Redefine processes, Reshape talent, and Reimagine core technology components — that form the backbone of a successful PLOM transformation.

Reach out to discuss this topic in depth.

Together, these pillars create a comprehensive framework for aligning teams, processes, and technologies with a unified product vision. Let’s explore each dimension and uncover how enterprises can build a more agile, customer-centric organization.

Reinvent organizational design: break down silos, build agility

A product-led transformation starts with rethinking organizational structures. Traditional hierarchies and functional silos stifle agility, innovation, and collaboration. To overcome these challenges, enterprises must align teams with business value streams — shifting from a technology-focused setup to a product-centric model.

Key considerations:

• Empowered, cross-functional teams: Establish product teams that blend business and IT expertise, creating accountability for both revenue generation and innovation. Models like Spotify’s squads and tribes offer excellent templates
  
• Clear roles and accountability: Define responsibilities such as product owners, agile coaches, and chapter leads to drive focus and clarity
  
• Generative culture: Foster a culture where teams are encouraged to innovate, fail fast, and continuously improve

Organizations that embrace alignment-enabled autonomy—where teams have the freedom to make decisions but stay aligned with overarching goals—experience better collaboration and faster decision-making. This approach positions enterprises to respond swiftly to market changes.

This exhibit illustrates the core structure of a product-aligned operating model that integrates business and technology teams, to deliver value through well-defined value streams. It emphasizes the role of persistent, cross-functional, and autonomous teams, supported by lean processes like Agile, DevSecOps, and automation-first approaches. The model is underpinned by robust platforms (business, technology, and foundational) that ensure efficiency, scalability, and consistency, governed by a lean framework for agile decision-making.

Redefine processes: from linear to agile

Processes define how work gets done, and outdated, linear project-based approaches can no longer keep up with today’s demands. Enterprises must adopt agile and DevSecOps methodologies to enable continuous product delivery and innovation

Key process shifts include:

• From projects to products: Replace project-based management with iterative, product-focused delivery cycles
  
• Integrated security and compliance: Incorporate security into the development process (DevSecOps) rather than treating it as an afterthought
  
• Outcome-driven metrics: Shift from measuring outputs (e.g., number of features delivered) to outcomes (e.g., customer satisfaction, time-to-market)

By adopting a lean product development mindset, organizations can reduce lead times, improve responsiveness, and ensure processes remain customer focused. Furthermore, OKRs (Objectives and Key Results) can help align teams with business goals and track progress effectively.

Reshape talent: from specialists to product champions

The success of a PLOM depends heavily on the people who execute it. Traditional role definitions and rigid expertise boundaries must evolve to create a dynamic workforce equipped for product-centric delivery.

Transformational steps:

• Upskilling and cross-training: Equip employees with skills beyond their immediate technical domain, enabling them to contribute to broader business outcomes
  
• Cross-functional collaboration: Encourage collaboration between business and IT professionals, fostering shared accountability for product success
  
• Talent deployment models: Implement flexible talent pools (e.g., chapters and guilds) to dynamically allocate resources based on evolving business needs

Reshaping talent not only empowers employees but also increases engagement. When individuals see the direct impact of their work on customer outcomes, it creates a culture of ownership and innovation.

Reimagine core technology: your strategic battlefield, not just infrastructure

A product-led operating model requires a robust and modern technology foundation. Legacy systems and fragmented tech stacks can undermine even the most well-designed models. Enterprises need to rethink their technology infrastructure to enable agility, scalability, and speed.

Core technology initiatives:

• API-first architecture: Enable seamless integration and interaction between systems, allowing product teams to access infrastructure and data efficiently
  
• Cloud-native solutions: Transition to scalable, cloud-based platforms that support rapid development and deployment
  
• Low-code/no-code platforms: Empower business teams to build and iterate on solutions without heavy reliance on IT resources
  
• Data-backed decision-making: Centralize analytics to provide teams with real-time insights for better decision-making

By reimagining technology as a platform rather than a collection of tools, enterprises can create an environment where innovation thrives. A modern tech stack also ensures consistency, reduces costs, and accelerates time-to-market.

Looking ahead: learning from pioneers

As enterprises embark on their PLOM journeys, the 4Rs offer a comprehensive framework to navigate the complexities of transformation. However, each organization’s path will be unique, influenced by its industry, size, and strategic objectives.

While this blog has explored the foundational pillars, the next in our series will reveal key insights from enterprises that have successfully adopted PLOM.

Based on Everest Group’s survey of 200 global enterprises, we will uncover the challenges, lessons, and tangible benefits experienced by leaders in this space.

Stay tuned as we bring you the perspectives and learnings from these pioneers to help you refine your approach to PLOM and set your organization up for success.

If you found this blog interesting, check out our blog focusing on Mid-market Enterprises: The New Frontier For Digital Transformation Services | Blog – Everest Group, which delves deeper into another topic covered by the Engineering & Information Tech service line.

If you have any questions, would like to gain expertise regarding PLOM, contact Krishna Zawar (krishna.zawar@everestgrp.com), Alisha Mittal (alisha.mittal@everestgrp.com), Parul Trivedi (parul.trivedi@everestgrp.com), Ankit Nath (ankit.nath@everestgrp.com) or Lalith Kumar (lalith.kumar@everestgrp.com).

In today’s rapidly evolving business landscape, traditional operating models are struggling to keep pace with the needs of digital-first enterprises.  

The shift toward product-led operating models (PLOM) has also become a strategic priority for many companies seeking to innovate faster, deliver superior customer experiences, and maintain a competitive edge. But what does a product-led operating model really entail? How does it differ from conventional models, and why should companies adopt it? 

This is the first blog in our series on product-and-platform led operating model transition. We aim to cover several dimensions on PLOM, including organizational design, processes, tools and technology and talent  in the coming blogs.  

This blog explores the essence of the product-led operating model, its impact on organizations, the challenges of adopting it, and the benefits it can deliver. Now, let’s dive deep into the principles, enablers, and outcomes of a product-led transformation… 

Reach out to us to discuss this topic further with our expert analysts.  

The dawn of the product-led era: More than just a buzzword: 

A product-led operating model structures the organization around products rather than projects. Each product—whether a service or software application—is treated as its own mini-business unit. Unlike the traditional project-based approach, PLOM is focused on long-term value creation, with dedicated teams responsible for each product’s lifecycle. This fosters accountability, continuous improvement, and faster innovation. 

*Based on Everest Group’s survey of 200 global enterprises with revenue more than US$ 1 billion 

 The 4 core tenets of a product-led operating model are: 

1. Decentralized information technology (IT) teams: IT is integrated into business units, allowing teams to work closely with stakeholders and understand the business context deeply
2. High autonomy: Teams are granted ownership over products, driving accountability and more meaningful outcomes for the business
3. Shift from milestones to objectives: The focus is on achieving business objectives, not merely meeting project milestones. This allows for iterative development and continuous delivery of value
4. Prioritize speed over perfection: Teams prioritize agility and responsiveness over lengthy perfectionism, speeding up time-to-market for products

Why your current operating model might be holding you back?: 

The traditional project-led approach, with its rigid timelines, fixed budgets, and siloed teams, is increasingly becoming a liability in today’s fast-paced digital landscape. Here’s why: 

1. Slow time-to-market: In an age where first-mover advantage can make or break businesses, the lengthy approval processes and waterfall methodologies of project-led models are detrimental
2. Disconnect from customer needs: Project-led approaches often prioritize internal metrics over customer satisfaction, leading to products that miss the mark
3. Innovation bottlenecks: With resources tied up in predefined projects, there’s little room for experimentation and pivoting based on market feedback
4. Talent drain: Top talent is increasingly drawn to environments that offer autonomy and end-to-end ownership – something project-led models struggle to provide

*Based on Everest Group’s survey of 200 global enterprises with revenue more than US$ 1 billion 

The product-led advantage: More than just faster delivery: 

While speed is a significant benefit of PLOM, its advantages extend far beyond just getting products to market faster: 

1. Enhanced customer loyalty: By continuously iterating based on customer feedback, product-led organizations create solutions that truly resonate with users, fostering long-term loyalty
2. Increased innovation: The autonomy granted to product teams creates a fertile ground for breakthrough ideas and disruptive solutions
3. Better resource utilization: Resources are allocated based on product performance and potential, ensuring optimal use of both human and financial capital
4. Improved employee satisfaction: The sense of ownership and impact fostered by PLOM leads to higher employee engagement and retention

Case in point: Spotify – Harmonizing innovation at scale: 

Spotify’s famous Squad model is often cited as a prime example of PLOM in action. By organizing into small, cross-functional teams (Squads) focused on specific product areas, it has maintained its innovative edge despite rapid growth. 

Spotify’s model demonstrates how PLOM can be scaled effectively in large organizations, maintaining agility without sacrificing coordination. 

Key Enablers of a Product-Led Operating Model: 

To successfully transition to a product-led model, companies must enable several foundational elements: 

1. Leadership commitment

Top-down leadership is essential for driving the shift to a product-led mindset. Chief Information Officers (CIOs) must evolve into Chief Influence Officers, ensuring that technological decisions align with broader business objectives​. Product-centric IT governance should also integrate strategic business priorities into product development. 

2. Agile and DevOps practices

PLOM requires an agile environment with continuous integration and continuous deployment (continuous integration (CI)/continuous delivery (CD)) capabilities. DevOps practices are essential for ensuring that new features can be tested, rolled out, and reverted back to quickly if necessary​. 

3. Effective use of data and feedback

Data plays a critical role in driving product decisions. Tools for clickstream analysis, user feedback, and feature performance helps teams understand how products are being used and where improvements are needed​.   

Metrics and KPIs: The Move from SLA to OKRs: 

A significant shift in a product-led model is the way success is measured. The traditional model focuses on service level agreements (SLAs) and key performance indicators (KPIs), while PLOM focuses on objectives and key results (OKRs). OKRs are ambitious, outcome-driven goals, that align with long-term business objectives rather than operational metrics. 

For example: 

• OKR: Increase active user base by 15% over the next quarter by enhancing product user experience (UX). 

• KPI: Did we meet our objective of reducing the churn rate by 5%? 

This shift from operational to business-centric metrics encourages teams to align their activities with broader business goals. 

Key challenges in adopting PLOM: 

1. Cultural shift: A product-centric IT model requires a change in mindset, moving from a ’defect-avoidance’ culture to a ‘fail-fast, learn-fast’ approach​. Organizations need to instill trust, ownership, and collaboration across teams, fostering a ’generative’ culture where experimentation is encouraged
2. Structural complexity: PLOM often introduces a matrix organizational structure, where IT and business functions operate closely. This setup can be complex, especially for larger enterprises that previously functioned in silos. For instance, defining decision rights—whether it’s feature sets, budget allocation, or vendor selection—can lead to friction between IT and business leaders
3. Governance and scalability: While PLOM emphasizes autonomy, central IT functions such as cybersecurity, compliance, and architectural standards remain crucial. Managing this balance between decentralization and centralized governance can be difficult

Overcoming the hurdles: Transitioning to a product-led model: 

While the benefits of PLOM are clear, the transition can be challenging. Here are some key considerations:  

1. Cultural transformation: Moving to a product-led model requires a significant shift in mindset across the organization. Leaders must champion a culture of experimentation, learning from failure, and customer obsession
2. Talent and skill gap: PLOM demands a different skill set, particularly in product management and data analytics. Organizations need to invest heavily in upskilling and potentially bringing in new talent
3. Technology infrastructure: Legacy systems can be a major roadblock. Investing in modern, flexible tech stacks is crucial for enabling the agility required in a product-led model
4. Metrics and KPIs: Traditional project-based metrics won’t cut it. Organizations need to develop new ways of measuring success, focusing on customer value and business outcomes rather than just delivery timelines
5. Governance and risk management: Balancing the need for autonomy with necessary oversight is crucial. Organizations must develop new governance models that enable speed without compromising on compliance and risk management

 *Based on Everest Group’s survey of 200 global enterprises with revenue more than US$ 1 billion 

The future is Product-Led: Are you ready? 

As we move deeper into the digital age, the ability to rapidly innovate, adapt, and deliver customer value will be the defining factor between market leaders and laggards. The Product-Led Operating Model offers a proven framework for achieving this agility and customer-centricity. 

However, the transition to PLOM is not a one-size-fits-all solution. Organizations must carefully assess their current state, culture, and goals to determine the right approach. It requires commitment from leadership, investment in people and technology, and a willingness to fundamentally rethink how value is created and delivered. 

The question isn’t whether your organization should consider a product-led approach, but rather how quickly you can begin the transformation. In a world where customer expectations are constantly evolving, standing still is no longer an option.

The product-led revolution is here – will you lead, or be left behind?

In our next blog, we will explore in-depth the key dimensions of PLOM: organization design, processes, core technology and talent. We will discuss at length a framework that serves as a blueprint for establishing the foundational principles of a product-and-platform-led operating model and assists enterprises throughout their transformational journey. 

If you found this blog interesting, check out our blogs page at Everest Group | Blog (everestgrp.com), which delves deeper into a wide range of topics across all of our service lines. 

To discuss this topic in more detail or for an even more detailed analysis, please contact Krishna Zawar and Parul Trivedi.

In an era of rapid digital transformation, organizations are increasingly turning to Change Management (CM) platforms to navigate complex transitions, however are many of these efforts meeting expectations?

According to Everest Group’s research with over 180 CXOs and business heads, 68% of enterprises have not realized the envisioned value from their digital transformation initiatives.

Additionally, 53% of enterprises cite change resistance as a key obstacle to achieving intended outcomes. These statistics highlight a critical question…are our current change management approaches truly effective, or are we simply rearranging deck chairs on a sinking ship?

Reach out to us to discuss this topic further with our expert analysts.

As organizations grapple with these challenges, the demand for robust change management platforms has surged. These platforms, designed to provide visibility, tracking, and insights into change programs, are becoming critical tools in the quest for successful transitions. Yet, the change management platform market is marked by diverse capabilities, emerging trends, and persistent challenges that are reshaping the future of change management.

In this landscape of unrealized potential and resistance to change, it’s crucial to examine the key trends, challenges, and strategic imperatives for both enterprises and service providers in the CM platform market.

Artificial Intelligence (AI) in change management: promise vs. reality

One of the most significant trends in the CM platform market is the increasing focus on integrating Artificial Intelligence (AI) and Machine Learning (ML) capabilities. While most providers have developed platforms that provide basic visibility and insights into change programs, there is a clear shift towards enhancing AI-related features.

Some mature players are moving quickly to improve AI within their platforms through new partnerships and by building internal capabilities that align with market demands. However, despite the potential of AI, many platforms still fall short of client expectations, particularly when marketed as prescriptive recommendation generators. With 60% of CM professionals reporting little to no implementation of AI in their engagements, the infusion of AI remains a critical area of focus for future platform development.

Building on giants: the power of enterprise platforms

Many CM platforms are developed on large enterprise platforms such as Salesforce, which offer familiar user interface (UI) elements, robust security controls, and seamless integrations. Building on such platforms allows providers to leverage existing infrastructure while enhancing their tools with advanced features. Additionally, major out-of-box integrations with large enterprise resource planning (ERPs) and other information technology (IT) assets are becoming increasingly common, enabling providers to cross-sell and upsell their services more effectively.

These integrations not only facilitate smoother implementation, but also enhance the overall value proposition of CM platforms, by incorporating industry research data, employee sentiment analysis, and other critical insights.

Show me the value: monetization strategies in CM platforms

The monetization strategies for CM platforms are evolving, with providers typically charging for their tools separately from the services they offer. In many cases, CM platforms are sold alongside advisory services, allowing providers to position their tools as integral components of broader transformation initiatives.

However, it’s not uncommon for these platforms to be purchased as standalone offerings, implemented either by the client themselves or a third party. In larger transformation deals, some providers even position their tools at no extra cost, framing them as an “investment” to drive adoption and differentiate their offerings. This approach reflects the strategic importance of CM platforms in securing and enhancing multi-million-dollar deals.

Beyond pretty dashboards: the quest for actionable insights

Despite the advancements in CM platforms, several challenges persist. The market is characterized by varying degrees of maturity, particularly in the use of machine learning. While platforms are increasingly focused on creating visibility and deriving high-level insights, they still offer limited intelligence and prescriptive capabilities. Basic visualizations and dashboards are prevalent, but the need for more sophisticated tools that deliver actionable insights remains un-met.

Moreover, the demand for stakeholder management, activity tracking, and impact analysis is high, yet many platforms struggle to fully meet these needs. To stay competitive, providers must continue to innovate and expand their AI capabilities while also enhancing the core features that clients value most.

The future of CM Platforms: what enterprises really want

• The change management platforms market is evolving rapidly, with enterprises demanding more than just basic change monitoring and adoption support. In addition to these core capabilities, organizations now seek industry-specific insights and strategic recommendations from their platforms. They expect CM solutions to be tailored to the unique needs of their business functions and industries, offering customization that drives more relevant and actionable outcomes

• Beyond visibility, efficiency gains are becoming a critical expectation. CM platforms are anticipated to automate diverse processes, reducing manual interventions, minimizing errors, and ultimately improving operational efficiency. This automation enables enterprises to achieve better business outcomes with less effort

• Furthermore, managing employee resistance is a key focus for CM platforms. Enterprises look at these solutions to deeply analyze employee behaviors and develop creative methods to motivate and align the workforce with change initiatives. CM platforms that provide clear roadmaps for driving change adoption and overcoming resistance will become essential in managing the human aspects of transformation

• Finally, strategic recommendations are becoming increasingly crucial for enterprise clients. CM platforms should offer self-serve capabilities that deliver actionable insights and guidance with minimal reliance on consulting services. The future of change management lies in platforms that can offer automation, customization, and strategic intelligence—all while enhancing workforce alignment and driving better business outcomes

If you found this blog interesting, you can read our 12 Steps To Effective Change Management In Global Business Services (everestgrp.com) blog, which delves deeper into the topic.

If you have questions or want to discuss CM platforms and solutions, please contact Krishna Zawar at Krishna Zawar or Parul Trivedi.