Product Thinking Podcast

Host: Melissa Perri
Episode 260: Avoiding Common Mistakes in Org Design
Date: December 10, 2025

Episode Overview

Melissa Perri dives into the key principles and common pitfalls of organizational (org) design in product management, responding to a listener question for her “Dear Melissa” segment. She unpacks approaches to structuring teams for success, outlines value-driven frameworks, warns against outdated tactics, and shares actionable guidelines for both new and experienced product leaders.

Key Discussion Points & Insights

1. Start with Value Streams, Not Org Charts

• The core of effective org design is aligning your team structure to value streams—what your organization delivers to customers and the value it creates.
• Melissa: “So what I do is I map out what we deliver to our customers and what value it brings and then I try to connect it all the way back to the platforms and the people who are building it.” [02:00]

2. Ownership and Reporting Lines

• Assign clear ownership of both long-term and short-term roadmaps.
  • Ensure each value stream has a leader who can see initiatives through end-to-end.
• Reporting lines should be simple, typically up to the Chief Product Officer, with dotted lines to GMs or business leaders in matrixed organizations.
• Melissa: “Do we have good coverage…is there a head of product around one of those pieces of value that can really see it through end to end?” [02:40]

3. Short Layers of Control Enable Agility

• Minimize management layers to speed up decision-making and empower teams.
• Excessive hierarchies (e.g., 15 layers between individual contributors and executives) create bottlenecks and dilute strategic focus.
• Melissa: “You want short layers of control because if you don’t, what happens is people look for control all the way up and down the organization and then they compress the strategy.” [04:10]

4. Balanced, Cross-functional Teams

• Teams should have the right mix of skills with minimal handoffs or dependencies.
• Avoid excessive centralization (e.g., a centralized design team) that creates slow “queues” for work.
• Melissa: “If you have centralized design teams and every time you want to do a design for UX…you’re going to slow yourselves down.” [05:15]

5. Key Methods of Team Allocation

• By Customer Persona: Use when product needs and workflows differ by user type (e.g., clinical vs. back-office in health tech).
• By Jobs to be Done: Use when multiple personas share overlapping product needs (e.g., reporting tools customized by user).
• Hybrid Approaches: Large orgs may use both—‘jobs to be done’ at a high level, breaking down by persona deeper in the org.
• Melissa: “You really want to make sure that you anchor it back to the value streams and figure out what makes sense for your context.” [07:10]

6. Classic Mistake: Organizing by Architecture

• Avoid assigning PMs to technical components (e.g., an API) without considering customer value; this leads to unnecessary work and lack of strategic impact.
• Melissa: “Somebody will always invent work if you put them around every single little component.” [08:15]

7. When Platform Teams Make Sense

• Platform/product infrastructure teams can power multiple customer-facing teams and avoid redundant solutions (e.g., common scheduling or data tools).
• Platform teams must closely align their roadmaps with customer value to avoid becoming siloed order-takers.
• Melissa: “They’re not just order takers for the customer-facing teams, they should be strategic as well. They’re usually building a very complicated backend.” [10:30]
• Even platform teams need dedicated product managers to build and communicate strategy.

8. Strategy Before Structure

• Don’t jump straight to org design. Start by defining your product strategy and portfolio, then organize teams to execute that strategy.
• Melissa: “Start with product strategy. Always figure out your product portfolio, figure out your strategy and then work your way back into an org design. Don’t just leap into org design.” [13:50]

Notable Quotes & Memorable Moments

• On mapping org design to value streams:
  “I like to think in terms of value streams...I try to connect it all the way back to the platforms and the people who are building it.” — Melissa Perri [02:00]

• On avoiding excessive hierarchy:
  “One big issue I see in many large corporations is when there is one person reporting it to one person, reporting it to one person…The worst I’ve seen is actually 15 people all the way up to the top.” — Melissa Perri [03:35]

• On team dependencies:
  “There are less handoffs, there is less waiting in queues…” — Melissa Perri [05:45]

• On pitfalls of architecture-based organization:
  “That API may have been solving a problem... somebody will always invent work if you put them around every single little component.” — Melissa Perri [08:20]

• On making platform teams work:
  “You need to have the infrastructure set up so that the platform teams are aligned to your customer facing value and coming all the way back through…They’re not just order takers.” — Melissa Perri [11:00]

• Final advice:
  “Do the strategy portion first, then come back and figure out how to organize to get that strategy done.” — Melissa Perri [13:50]

Important Timestamps

• 02:00 – Mapping customer value to org structure
• 03:35 – Dangers of deep linear hierarchies
• 05:15 – The importance of balanced teams and minimizing dependencies
• 07:10 – Ways to allocate teams: personas vs. jobs to be done
• 08:20 – Why organizing PMs by technical components is a mistake
• 10:30 – Strategic role of platform teams
• 13:50 – Why strategy always comes before org design

Key Takeaways

• Always ground org structure in your value streams.
• Short, clear reporting lines and empowered product owners are essential.
• Balanced, cross-functional teams minimize inefficiencies and delays.
• Avoid organizing by technical architecture; focus on delivering customer value instead.
• Platform teams are important but must remain strategically aligned.
• Start with product strategy, not diagrams or charts—let your strategy guide your org design decisions.

Listeners seeking actionable frameworks for org design in product management will find Melissa’s guidance practical, strategic, and rooted in years of experience leading organizational change.