Making the Product Operating Model Stick: How to Turn Product Thinking into Business Results

Why do so many organisations declare they are “going product” and yet keep measuring success as if every initiative were a project with a fixed end date? The language changes quickly — squads, chapters, product managers — but the outcomes rarely do. For leaders tasked with turning product rhetoric into repeatable value, the uncomfortable truth is this: adopting product language is easy, changing the operating model is not.

Where most product transformations derail

There are three recurring mistakes I see in large organisations.

• Purpose mismatch: Product teams exist, but their goals aren’t aligned with strategic outcomes. Teams optimise local KPIs rather than customer value.
• Project funding mindset: Budget is still allocated for fixed-term projects, which pressures product teams into short cycles of delivery rather than long-term optimisation.
• Partial adoption: The organisation keeps traditional silos — platform engineering, commercial, design — and expects a few empowered teams to carry the change.

These are not accidental. They are symptoms of treating the product operating model as a structure change rather than a system change.

Designing for outcomes: the elements that actually matter

Moving to a true product operating model is a systems exercise. Focus on five practical elements:

• Long-lived cross-functional teams: Teams should own a product or outcome over time, not just deliver a project. This fosters learning and ownership.
• Clear outcome metrics: Replace output metrics with metrics tied to customer behaviour and business impact. Make these the team’s north star.
• Stable funding: Shift budgets from projects to product portfolios. Fund continuously when value is demonstrated, not until a Gantt chart ends.
• Platform and plumbing: Invest in shared platforms (data, infra, identity) so product teams can move fast without duplicating effort.
• Capability and rituals: Teach product skills across the organisation — discovery, experiment design, hypothesis thinking. Use common rituals to align teams and leaders.

Data backs this up. McKinsey’s research into product operating models highlights measurable improvements in both customer engagement and financial performance when organisations adopt these practices. See their analysis on the bottom-line benefits of the product operating model.

Governance without suffocation

One of the hardest shifts for executives is learning to govern outcomes rather than tasks. Practical governance looks like this:

• Define a clear portfolio of products with a small number of strategic outcomes.
• Set review cadences that evaluate impact (monthly or quarterly) and unblock constraints, not to micro-manage scope.
• Use lightweight investment gates focused on evidence — validated learning and customer metrics — instead of lengthy business cases that assume certainty.

This is not an abdication of control. It is a reallocation of governance energy from specifying features to clarifying the problems teams must solve.

Protect the new while scaling the old

Corporate inertia is real. A useful pattern is to create protected spaces where new product ways of working can be experimented with and demonstrated. ING’s agile transformation is an instructive example: their move to multidisciplinary squads and end-to-end ownership, described in McKinsey’s case study on ING, was not an overnight cutover. It began with focused pilots, clear outcome metrics, and then a steady migration of budget and capability.

Tools such as the Atlassian Team Playbook are pragmatic helpers here — they codify rituals and health checks that teams can adopt immediately to improve collaboration and reduce failure modes.

Three practical moves you can make this quarter

• Run a portfolio health audit: Map current funding streams to customer outcomes. Identify at least two product areas you can move to continuous funding.
• Make a discovery contract: For one strategic initiative, require a discovery phase that must produce customer-validated hypotheses before scope or budget is fixed.
• Invest in one shared platform capability: Pick the most common blocker (data access, authentication, deployment) and fund it centrally so teams can accelerate.

Looking ahead: evolution, not revolution

Adopting a product operating model is not a one-off project. It is a capability shift that unfolds over years: first pilots, then scaling, then institutionalisation. The temptation for leaders is to look for a template — a copy-paste of another company’s model — and expect identical results. That rarely works. The right question is not “Which model should we copy?” but “How does a product way of working best serve our strategic outcomes and customers?”

Start small, measure relentlessly, and protect learning. If you get the operating model right, the user-centred practices that follow will create not just better products, but a healthier, more adaptive organisation. If you are responsible for digital, product or technology, your immediate advantage is pragmatic: pick one product line, change the funding model for it, and watch what the teams learn. That single experiment will tell you more about the roadmap to scaled product maturity than any consultant deck.