Which one is more suitable for you?
Before delving into this whole parley on product-led and engineering-led organization, we want to reiterate ‘Aristotle:
‘The whole is greater than the sum of its parts.
When you will read this blog in its entirety, the quote will automatically make sense. The engineering-led or product-led organization debate is something that has been around for a while and there are pros and cons to both.
The aim of this blog post is not to say one is better than the other, but to explain the two different types of organizations and help you decide which one might be more suitable for you.
Product development entails a variety of factors. The cynosure of the product development and its management is the ‘User‘. In recent years, as we have observed, the methodology of product development and its management has gotten increasingly consumer-driven and market-oriented. The focus is now on providing the maximum value to the user. From the Inception of the core idea of the product to its very sales, every step encompasses pensive user research and marketing astutely.
In traditional business models, engineering-led organizations were the norm. The engineering team designed and built the product, and the marketing team sold it. In a product-led organization, the product management team is in charge. The product management team designs, builds, tests, and launches the products.
The engineering-led model is still common in many industries, such as automotive and aerospace engineering. But as products become more complex and include software and digital content, the product-led model is becoming increasingly popular.
One reason for this shift is that products are now more complex than ever before. They often include software and digital content, which can be difficult to engineer correctly. In a product-led organization, the focus is on delivering the right product at the right time. The engineering-led model is still common in many industries, such as automotive and aerospace engineering.
But as products become more complex and include software and digital content, the product-led model is becoming increasingly popular. In this article, we will look into why engineering-led organizations are not effective all the time and how a product-led organization can help.
It’s essential to understand what methodology and approach you take in your product journey. What principles lead your organization will ultimately determine the fate of the product.
That is why it is important to distinguish between an engineering-led and product-led organization.
What Are Product-Led and Engineering-Led Organizations?
Traditionally, the engineering team or the development team solely formed the core of most of the digital product organizations, they were vested with the job of developing the product, solving technical bugs, glitches and leading the company on the technical front. These were engineering-led organizations.
Over time, product managers have come to the forefront and now manage products and portfolios, with engineering playing a supporting role.
In product-led organizations, engineering is primarily responsible for developing the product in line with customer needs and market trends.
The product manager steers the team towards these goals and ensures that the engineering team is working on the most important features and functions.
An engineering-led organization is typically when the engineering department takes the lead in designing, building, and launching products. The engineering team is responsible for taking the product from conception to launch.
This type of organization often results in a very waterfall process, where requirements are finalized before development begins and changes are difficult to make.
The engineering team also becomes a bottleneck in the process, as they are responsible for getting sign-off from other stakeholders such as marketing, sales, and management.
An engineering-led organization is one where the engineering team is in charge. The engineering team designs, builds, tests, and launches the products. This type of organization puts a lot of emphasis on technology and can be very process-driven.
A product-led organization, on the other hand, is one where the product management team is in charge. The product management team designs, build tests, and launches the products.
The concept of product-led organization is more neoteric and it entails engineering to take initiatives in engineering the product. This implies engineering has a significant role in deciding the key features of the product, its architecture, and its interfaces with other systems.
Generally, engineering-led organizations are more common than product-led ones; however, this is beginning to change as companies recognize that engineering alone cannot meet customer expectations. Product management typically gets involved much earlier (i.e., concept definition) than engineering, which means it can provide insights on what customers want before the technology is created.
Now that you have a peripheral idea about both the engineering and product-led organization, let’s throw some light on the major differences between the two.
What Are the Differences Between the Two?
Now let’s discuss the differences in detail:
Engineering-led organizations are often driven by technology and new product launches. Engineers focus on developing products that meet technical specifications, rather than what customers want or need. This can lead to products that are not well-aligned with customer needs and preferences, which can impact sales and market share.
In contrast, product-led organizations are focused on the customer and what they want. Product managers work with engineering to ensure that products are developed based on customer feedback and insights. This typically results in products that are more aligned with customer needs, leading to higher customer satisfaction and loyalty
In Terms of Alignment with the Customers
Products from a product-led organization are usually more aligned with customer needs and desires as opposed to an engineering-led organization. Product managers work very closely with the engineering team to ensure that every product meets or exceeds customer expectations. This often results in customers being more satisfied with the products and services offered by the company.
A product-led organization typically has a much greater focus on customers than an engineering-led organization. This focus can be seen in the way that product managers work closely with the engineering team to ensure that every product meets or exceeds customer expectations. It can also be seen in the way that companies often have customer feedback loops in place to get immediate feedback from customers about their experiences with products.
In Terms of Emphasis on Products
The engineering-led organization typically focuses on developing new technologies and products while a product-led organization emphasizes bringing existing products to market quickly and efficiently. The focus is on meeting customer needs and wants, not on developing new technology for the sake of developing new technology.
In Terms of Autonomous Teams
In a product-led organization, teams are typically more autonomous than in an engineering-led organization. This autonomy allows teams to move quickly and efficiently to bring products to market. It also allows them to be more creative in their approach to product development.
In Terms of Emphasis on Product Management
In a product-led organization, the role of product management is often more important than in an engineering-led organization. This is because product managers are responsible for ensuring that products are developed effectively and that they meet customer needs. They also play a key role in creating and executing the company’s product strategy.
In Terms of Focus on Innovation
In product-led organizations, there is a greater focus on innovation. This can be seen in the number of new products that are launched and the amount of time that is devoted to researching and developing new products. It can also be seen in the way that product managers are responsible for coming up with new ideas for products and for ensuring that products are constantly updated to meet the latest customer needs.
While in engineering-led organizations:
In Terms of Emphasis on Execution
In product-led organizations, there is more emphasis on execution. This can be seen in the way that product managers are responsible for ensuring that products are developed effectively and that they meet customer needs. It can also be seen in the way that engineering teams are built and managed; engineering teams in product-led organizations tend to be smaller and they focus on building products.
In engineering-led organizations:
In Terms of Engagement of the Entire Organization
A product-led organization encourages engagement across all levels of the organization, from managers down to entry-level employees. This is because everyone (from engineering teams to management teams, etc.) contributes ideas about what new products should be developed or how existing products could be changed or updated. When this happens, everyone feels like their voices are heard and that their contributions matter. Thus, individuals who work in product-led organizations feel committed to what they’re doing because it directly impacts the company’s success.
In engineering-led organization, however :
In Terms of Vision
The vision of the product-led organization is the ‘product’ as in every nitty-gritty detail surrounding it. However, the vision of the engineering-led organization: a product that is the sum of all its engineering parts.
The engineering-led organization can build things fast and well, but they may not have a clear idea of what the product is or who it’s for.
In Terms of Overall Prioritization
Because the product-led organization prioritizes the product vision over everything else, it can be difficult to make changes once products are in development. This is especially true if there is a lot of investment in a particular direction.
In contrast, the engineering-led organization typically prioritizes speed and execution over all else, which can make it more flexible but also means that features may not be well thought out or coordinated.
Which One Is Perfect for Your Organization?
As we stated earlier, engineering-led organizations are a thing of the past. Nowadays with the evolution of product management, the driver of the organizations is no longer solely the engineering team, other teams such as design, marketing, sales, etc are given equal emphasis.
The product-led organization is the new ideal and it relies on the product manager to make sure that the products are designed, marketed, and sold in the right way.
A lot of factors come into play when determining which type of organization is perfect for your business. Things such as size, stage of development, market, and more will all have an impact on which type of organization you decide to go with.
Product-led organizations cover a much larger ambit and the engineering team plays an important role within it. The engineering-led organization is product-focused, and the engineering team drives the product development.
Even if you have an engineering-led organization, there are a few advantages of it, which are as follows:
Benefits of having an engineering-led organization
A clear focus on the product
In an engineering-led organization, there is a clear focus on the product, and every member of the team is geared towards developing it. This type of organization allows for better collaboration between different teams and a streamlined development process.
With everyone working towards a common goal, the engineering team can achieve greater efficiencies. This helps to speed up the product development process and get products to market quicker.
Having an engineering-led organization also results in improved product quality. By having direct control over the engineering process, the engineering team can better ensure that products are developed to meet the highest standards.
But the product led organization stands out in terms of having:
Greater focus on users
In a product-led organization, the focus is always on the user. The product team is responsible for understanding user needs and designing products that meet those needs. This focus on the user helps to ensure that products are not only well designed but also useful to customers.
So, you see now right product and engineering aren’t antithetical, rather they supplant one another to meet requirements.
An organization can only work efficiently when you have a robust technical foundation. The engineers and the developers are essential for product development. In fact, engineering is part of the ‘product-led organization’ approach. This engineering organization is one of the key components to successfully designing and engineering products.
It’s important to understand that the product and engineering-led organization approaches aren’t antithetical to each other. Every organization today is mostly product-led and Engineering is a nonpareil part of it.
The ambit and horizon of product development have expanded over the years. Today along with the engineering team there are other important teams too, which serve an essential function in the entire process.
With the growth of the market, technology, consumer awareness, and fierce competition, a newer and more Wholesome concept of product management has emerged, which doesn’t mean that the old engineering-led approach has gotten obsolete.
Engineering still holds extreme importance in product development. It’s just that, it merged with other essential aspects too like marketing, sales, design, etc, and in totality, we call it ‘product management.’