I watched a client’s leadership team celebrate their “product transformation” last quarter. They’d renamed their project managers to product owners, reorganized around products instead of projects, and hired a Chief Product Officer. Six months later, they were still making the same decisions the same way — funding annual roadmaps, measuring velocity instead of value, and wondering why their “product-led strategy” wasn’t working.
This is product theater. And it’s everywhere.
The conversation about product thinking versus project thinking has become exhausting. Everyone knows the difference. Output versus outcome. Build the thing right versus build the right thing. Fixed scope versus continuous discovery. We’ve read the articles. We’ve been to the talks. We know the language.
Yet most organizations that claim to practice product thinking are still operating with project thinking systems. The problem isn’t understanding — it’s execution. And the reason execution fails is fundamental: organizations treat product thinking as a mindset shift when it’s actually a capability-building challenge.
The Linguistic Rebranding Trap
When organizations move toward product thinking, they typically start with structure and language. They change titles. They reorganize teams. They talk about outcomes instead of outputs. It feels like progress.
But structure without capability creates expensive theater.
Consider the data: the number of Chief Product Officers in Fortune 1000 companies grew from 15% to 30% recently. That’s significant. But hiring a CPO doesn’t build product thinking capability any more than hiring a CTO automatically creates technical excellence. The role creates accountability. Capability requires systems.
The linguistic trap is seductive because it’s visible. You can announce a reorganization. You can point to new titles. You can show a product roadmap instead of a project plan. What you can’t easily show is whether your organization has built the underlying capabilities that make product thinking real.
Product Thinking as Organizational Capability
Here’s what most articles miss: product thinking isn’t something individuals adopt — it’s something organizations build systemically. It requires changes in decision-making systems, governance structures, funding models, measurement frameworks, and collaboration patterns.
When companies fail at product thinking, it’s rarely because people don’t understand the concept. It’s because the systems around them make product thinking impossible to practice.
I call these the Four Capability Gaps — the systemic deficiencies that turn product thinking from genuine capability into performative theater.
1. The Discovery Capability Gap
Everyone knows they should “talk to users” and “validate assumptions.” But knowing isn’t capability.
Real discovery capability means:
- Systematic, continuous research infrastructure (not periodic validation sprints)
- Decision-making processes that wait for evidence before committing resources
- Organizational patience for exploration without predetermined outcomes
- Skills in research methods distributed across teams, not concentrated in specialists
Most organizations have discovery aspiration without discovery infrastructure. They want product teams to “be customer-obsessed” but don’t give them research budgets, protected time, or decision authority based on what they learn. Business agility requires continuous learning, but systems designed for predictable delivery actively punish learning time.
2. The Decision-Making Capability Gap
The shift from outputs to outcomes sounds simple. Measure business results, not task completion. Focus on impact, not activity.
But decision-making capability requires:
- Governance structures that fund outcomes, not features
- Leadership comfort with ambiguity and iteration
- Measurement systems that connect product work to business results
- Reward structures aligned with outcomes, not delivery pace
I see organizations that say they care about outcomes but govern through feature roadmaps committed eighteen months out. They want teams focused on value but measure them on velocity. The cognitive dissonance is exhausting for everyone involved.
3. The Collaboration Capability Gap
Cross-functional product teams are the standard recommendation. Put designers, engineers, and product people together. Make them responsible for outcomes. Simple, right?
Collaboration capability actually requires:
- Organizational structures that enable team autonomy
- Funding models that allocate resources to teams, not projects
- Career paths that reward team outcomes, not functional expertise
- Conflict resolution mechanisms when cross-functional priorities misalign
Most companies create cross-functional teams but keep functional reporting lines, functional budgets, and functional incentives. Then they wonder why collaboration feels forced and decision-making is slow. Transforming to product thinking requires systemic organizational change, not just team composition changes.
4. The Learning Capability Gap
“Iterate based on data” is product thinking gospel. Test, learn, adapt. Build-measure-learn. Everyone agrees.
Learning capability means:
- Systems that enable acting on what you learn (not just collecting data)
- Risk tolerance for changing direction when evidence demands it
- Technical architecture that supports rapid iteration
- Psychological safety to admit when assumptions were wrong
Organizations often build elaborate data collection infrastructure without building decision-making infrastructure that uses it. They have dashboards full of insights and roadmaps full of predetermined features. Data is collected. Learning doesn’t happen.
Why This Matters More in 2025
These capability gaps always mattered, but three trends make them critical now:
AI acceleration means the pace of market change is accelerating. Organizations that can’t learn and adapt quickly will fall behind. Product theater won’t cut it when competitive advantage depends on continuous adaptation.
Product-led growth exposes product theater immediately. When your product is your primary customer acquisition channel, the quality of product thinking shows up in conversion metrics, not just internal satisfaction surveys.
Market volatility makes outcome focus survival-critical. When market conditions shift rapidly, organizations committed to predetermined outputs sink resources into the wrong things. Adaptive capability isn’t a nice-to-have — it’s existential.
From Theater to Intelligence: The Capability Audit
Product thinking isn’t a mindset you adopt — it’s a capability you build. And capabilities require systems, not slogans.
Start with diagnosis. Ask these questions about each capability gap:
Discovery:
- Do teams have protected time and budget for continuous research?
- Can teams delay delivery decisions while they validate assumptions?
- Do leaders ask “what did you learn?” as often as “what did you ship?”
Decision-Making:
- How are product teams funded — by feature commitment or outcome ownership?
- What happens when evidence suggests changing direction mid-initiative?
- Are teams rewarded for impact or throughput?
Collaboration:
- Where does budget and decision authority actually sit?
- What happens when cross-functional priorities conflict?
- Do career progressions depend on team outcomes or functional performance?
Learning:
- What’s the time from insight to action?
- When was the last time you killed an initiative based on data?
- Is “we were wrong” treated as failure or learning?
If you don’t have good answers, you don’t have product thinking capability — you have product thinking aspiration. And aspiration without capability is just theater.
The path forward isn’t more talks about mindset. It’s building the systems that make product thinking possible. Not because it’s trendy. Because in a world accelerating toward adaptive intelligence, organizations that can’t genuinely think in products won’t survive.
Ralph Jocham is Europe’s first Professional Scrum Trainers, co-author of “Professional Product Owner,” and contributor to the Scrum Guide Expansion Pack. As an ICF ACC certified coach, works with organizations to build Product Operating Models where strategic clarity, operational excellence, and adaptive learning create measurable competitive advantage. Learn more at effective agile.
Sources
- ProductPlan: Product Mindset vs Project Mindset
- FullStory: Project vs Product Thinking
- Guillaume Legrain: The Future of Product Management in 2025
- West Monroe: Moving From Project to Product Mindset
- Productboard: Transforming Project to Product Mindset