It is common to make mistakes in understanding the difference between a project or product from a strategic and funding point of view.
Let’s talk a little about why companies are failing miserably in their innovation processes. It all starts with a simple concept: Project or Product.
If you do a quick Google search on the subject, you will find definitions that lead to the following understanding: Project has a beginning, middle and end; Product is a continuous evolution.
Golden Magic Placebo Pill
What is happening in the market in general: initial process of the software design maturity cycle, such as design and management techniques; and a very big initial error in understanding the difference between a project or product from a strategic and funding point of view.
For most companies, the product is the way it is built, and that bahamas whatsapp data is what changes for a project. They usually associate Waterfall techniques like the Unified Process with projects and new team building techniques, like Spotify's Culture model, used haphazardly in a "squad" format with Ideation processes (Design Thinking, VPC, Lean Inception, etc.) and management 3.0, and any other new technique they want to add to the gourmet sauce.
But the funding remains the same, finite, that is, the cycle should complete a delivery and measure the ROI of what was produced. So, the frustration of most executives who are paying this bill sets in, because the expense of doing it digitally was much higher and the accounts did not add up, there was no increase in the company's revenue and the valuation did not have a real increase.
Disclaimer: In some cases, valuations go up because investors need a speculative bubble to make money on the stock market. So let’s separate things…
The project has nothing to do with the way it was produced, whether it was done with the best design and modeling techniques. Projects have a clear nature: they are the foundation for some Value Stream of the company, they have a determined investment for an expected result based on some OKRs. They have a beginning, middle and end; and at the end of the cycle, the results should appear.
As any software delivery suffers from entropy, to keep the investment preserved for as long as possible, there is a recurring bill for maintaining the state (energy), and corrections and small adaptations.
The funding for the project comes from the Value Stream it serves, and enters the accounting as a recurring expense entry, a fixed cost to be considered to keep the operation running, as it supports it.
I break down the understanding of the product into two parts, which makes it much easier to understand where everyone is going wrong.
Foundation Products
They support the main Value Stream and have a continuous funding model; while that business thesis is being tested and improved, the product receives funding and continues its life cycle.
This type of asset is often the Core of the Value Stream, such as Mobile Internet Banking – it is impossible to imagine a B2C banking operation today without continuous investment in improving the user experience.
Maturity based on this understanding is crucial for the company to understand how it finances its operations and how to measure the results of its investment.
Innovation Products – creating a value chain
Well, here we are! This is where most companies make a big mess and have no idea how they are managing their Innovation Portfolio.
Products are usually the smallest particle of a Value Stream. I usually associate the Value Stream with a Molecule and the Atom with the product. The Innovation Product is where the company starts to test new business theses, and these theses are usually in line with the company's purpose.