IT Outsourcing: Should the Product Owner come from the Client or the Provider?

In order to maximize product value, the Product Owner (PO) should take care of the needs of several stakeholders – sponsors, end users, managers – who are, especially in an outsourcing context, spread over various countries and who have a lot to say. As service providers, a question we are frequently asked is: Where should the Product Owner come from: the Client or the Provider? And to go one step further: Should he be closer to the stakeholders or the development team?

The goal of this post is to provide various unbiased perspectives which may help you to decide who is better fit for the job.

Source: Shutterstock

Advantages of having the PO from the CLIENT

1. Proximity to sponsors and other stakeholders

When the Product Owner is close to sponsors and other stakeholders, he is probably already in contact with most of them and knows very well who might have the right answers to different questions. He knows them well enough to ask the right question to the right person. This type of tacit knowledge empowers him to find answers quickly, on different issues, and why not, to solve conflicts before they might get out of hand.

2. Inside business knowledge

An inside man is always better informed and familiar with the client’s business and culture, he knows who the competition and clients are and can make more informed decisions regarding product development.

3. Higher empowerment towards the development team

The Product Owner is seen as the client’s official representative. His leadership is acknowledged by default on both the functional and business side, and he is instantly trusted.

4. Better visibility regarding feature usage in production

When a product is launched in production, various adjustments are made depending on its use. At this level, it is obviously easier to share data with an insider than with a provider.

Advantages of having the PO from the PROVIDER

1. Better alignment to product ownership best practices

As a provider is specialized in building certain products, there are higher chances for the Product Owner to have worked on many projects with many clients from different fields of activity. And there is a bigger chance that they have clearly defined expectations and higher standards. They will explicitly invest in the training of their staff, will probably have agile communities to step in on different issues, agile coaches that may help the product owners by offering assistance or training.

2. Higher accountability

The Product Owner appointed by the provider engages in a better collaboration with the development team on all types of activities, including product vision, backlog refinement, and identification of the most appropriate solutions and so on.

3. Specialized tools, documentation and processes

A provider with several years of experience in product development is also more prone to use different tools and processes that help the development team finish the product in time, efficiently and at the required state-of-the-art standards.

4. Better visibility on project progress and better collaboration with the development team

When the Product Owner and the development team come from the provider, the provider feels more responsible for developing the entire solution and making sure that they are building the right features, in the right way and for the right price. Thus, the chances of delivering a higher value may also increase.

Also, the visibility on product progress towards the goal, risks, impediments, and opportunities may be better as the development team will share project details in a more natural way, especially when the Product Owner is close to them.

Conclusion

The truth is that there is no unanimous answer. If a Scrum Master’s place is near the development team and where impediments are, the Product Owner’s place should be there were most product development challenges are. The Product Owner is, after all, a person that has his luggage packed for a new spontaneous destination anywhere in this world. For instance:

• During the discovery phase: the PO is close to the business, working on aspects such as vision, needs, backlog, product strategies and so on.
• During the project kick-off phase: the PO is close to the development team, reviewing the vision, roadmap, integrating a technical perspective, refining the project strategy.
• After the production phase: the app is launched in production. The Product Owner has to be flexible and intervene where he is needed, being a leader servant to end users, other stakeholders or the development team.

That being said, a fair answer to the question is that it is more important for the Product Owner to do his job well, to fulfill his obligations, and to deliver as much added value as possible, irrespective of who appointed him.

More articles on product ownership to follow soon. Don’t miss them!

Read more about:Pentalog’s Agility program and agile communitiesAgile Methodologies: The Perfect Match for Startups

Download Pentalog price list!