There is a lot of talk these days about project to product organizations. I would argue this goes hand in hand with an Agile transformation. You cannot effectively have one without the other. A few of the reasons why follow.
No one “owns” the application in a project organization, a project team is formed, and dissolves based on delivery of the project. With a product team you have a team that owns the product long term, it is then that you get the benefits of ownership (deeper business knowledge, greater skillsets, higher quality, faster delivery).
It is the difference between the short-term ownership of the project to the long-term ownership of the product. You don’t lose time forming project teams, the team is already formed and normed (with no J-curve) and ready to go. The product team has deeper engagement, morale and more innovation because they are not treated as resources to be shuffled based on the next project.
Funding is simple and a fixed cost, the cost of the teams combined salary, you can count on this vs. trying to fund a project upfront based on guesswork and then dealing with the overruns which require negotiation and disappoint expectations or underruns which encourage gold-plating the application with unnecessary features. Funding teams is simple, even in the world of CAPEX/OPEX, you simply apply your capital/cost to the product based on the team’s presence, working on the application.
You are able to measure the value you are delivering to your customers based on OKRs and KPIs vs. measuring success based on delivery on-time and on-budget, on-scope which just tells you how well you did with your project not how well your product is doing on delivering against the corporate strategy.
These are only some of the benefits and methods, there are many more. The product model of organizing is here to stay, it beats out the project model every time in today’s complex and shifting digital environment.