A products-driven organization replaces the customer as king with the product as king. These organizations know their “center of gravity” is the product. A products-driven organization puts its energies into producing either the best product on the market or a series of products that stay ahead of the market requirements. In a products-driven organization, two factors influence success. The first factor is the product itself. No effort is missed in making the product the centerpiece of the organization. Companies with an early product lead often lose the advantage when they stop the product improvement. A competing company then buys the market with an improved model just far enough off the original design that patent or copyright infringements are not a problem. A products-driven organization can ride a single product for years if it has the foresight to pour the effort into maintaining the product’s visibility in the marketplace.
An issue faced by every products-focused company is obsolescence. Continuous improvements help, but not for the pet rock or hula hoop. Some products are fads with a limited shelf life or life span, no matter the marketing efforts. Management teams have to make tough decisions about their approach to products since significant capital investment is required to generate a stream of products or refurbish the existing lines.
A second way for a products-driven company to succeed is to try to always top its own product through creativity. This is done through a business structure that is loose enough to allow for creativity. Out-of-the-box thinking is necessary in a products-driven organization because demand for innovations on the existing products is relentless. When combined with the requirements for a stream of new and better products, the culture, by definition, must promote innovation by individuals and teams. The reward system in a products-driven company is based on the creativity required to develop and sustain a steady stream of products. The constant problem with any products-driven organization is guessing what the public will buy.