Unpacking Prod•gnosis

It’s been a while since I wrote about Prod•gnosis. I thought it might be a good time to mention it once more.

What is Prod•gnosis?

Prod•gnosis is a model for running a business, built on the modern principles of Flow, Systems thinking, and Value Streams.

Introduction: Foundations Terms

The terms “flow,” “value streams,” “systems thinking”, and “product development” often appear complicated and exclusive to business experts. However, understanding these ideas is vital for the effective operation of any organisation. This post aims to clarify these arcane terms and introduce you to Prod•gnosis, an approach to integrate these elements for business success.

Core Concepts Explained

Flow

Flow refers to the movement of work through an organisation. It starts from the initial concept and ends at the delivery of a finished product or service. Effective flow reduces delays, enhances quality, and makes best use of resources. Flow offers a number of business benefits.

Value Streams

A value stream is the sequence of activities an organisation performs to deliver a product or service to a customer. This set of activities starts from the moment a customer requests a product or service, and continues through to its delivery and cash collection. It covers everything from order-taking and production to logistics, distribution, billing, and even after-sales service.

The main goal of understanding any particular value stream is to identify ways to realise the benefits of improving flow. This means looking at how work moves through the organisation, determining where delays or bottlenecks occur, and finding ways to streamline those areas. By optimising its value streams, a company can produce and sell goods or offer services more efficiently, ultimately delivering better value to the customer.

Product Development Value Streams and Operational Value Streams

A Product Development Value Stream (PDVS) focuses on the series of activities that take a product from its conceptual stage through to market launch. Unlike a value stream that concerns itself with manufacturing or delivering a finished product, a PDVS involves steps like research, design, prototyping, testing, and development.

Product development is the complete process of bringing a new product or service to market. Operational value streams are the set of activities that continuously deliver existing products or services to the customer.

The goal is to manage this set of activities efficiently and cohesively so that new products can be brought to market more quickly, more cost-effectively, and with higher quality. In essence, it’s about aligning all the different departments and specialists involved in creating a new product—such as engineering, design, marketing, logistics, sales, and finance—to work towards a common objective.

Understanding and optimising the PDVS can enable an organisation to gain competitive advantage by accelerating time-to-market, reducing development costs, and ensuring that the final product better meets customer needs.

Systems Thinking

Systems thinking is an approach to problem-solving and understanding complex situations. Rather than breaking down a system into its component parts, for individual study, systems thinking aims to view the system as a cohesive whole. This approach recognises that the components of a system can interact with one another in ways that significantly impact the function and properties of the entire system.

In business and organisational contexts, systems thinking often involves considering how various departments, roles, processes, and external factors are interconnected. By understanding these relationships, one can better identify underlying issues, anticipate the consequences of specific actions, and generate more effective solutions for complex challenges.

It deviates from traditional linear thinking, which tends to focus on cause-and-effect relationships in isolation. Systems thinking acknowledges feedback loops, delays, and other complexities that are inherent in most systems, be they biological, organisational, or mechanical.

The benefits of applying systems thinking in an organisation include a better understanding of the big picture, improved collaboration among departments, and more effective problem-solving and decision-making processes. As Buckminster Fuller noted: a system when taken as a whole has behaviours that cannot be predicted by the behaviours of their parts taken separately.

Introducing Prod•gnosis

Prod•gnosis proposes a disciplined approach to managing the flow of new products into the market. In essence, it is a framework for creating and launching operational value streams dedicated to specific product lines. Each operational value stream is a custom-built organisational pathway for manufacturing, packaging, shipping, selling, billing, payment collection, and servicing a particular product.

The goal of Prod•gnosis is to manage the flow of new products into the market in a disciplined and evolving manner. It focuses on creating and launching operational value streams tailored to each new product or product line. Essentially, it strives to optimise an organisation’s capability to bring new products to market efficiently, effectively, and in a way that allows for continual improvement.

Where Does Product Development Fit?

Prod•gnosis challenges traditional models of product development, often – for software products at least – homed within in IT departments. Instead, it suggests the formation of a distinct “Product Development Value Stream” (PDVS). This PDVS value stream focuses solely on the process of creating new operational value streams for each new product or product line, thus preventing the inefficiency of constantly assembling and disassembling multi-departmental product development teams. By having a PVDS dedicated to creating operational value streams, the organisation can build a dedicated specvialist capability in this area. This contrasts with traditional approaches, where the capability for building operational value streams is fragmented across time and organisational departments

Summary: Why It Matters

Embracing Prod•gnosis is more than just tweaking a few business processes; it’s about a fundamental change in perspective informed by systems thinking. This approach enhances an organisation’s adaptability and positions it for accelerated growth. By focusing on flow and value streams, Prod•gnosis provides a robust framework for improving how an organisation introduces new products to its markets. It’s a concept accessible to everyone, not just business experts, and a game-changer for an organisation’s future. Are you prepared to think in these new terms?

Further Reading