You know you're a product when...

Over the last couple of weeks, I've been involved in several conversations with a common theme: What's a product?

While that might seem like a profoundly dumb question, it's not. The definition of "product" can be pretty elusive, and not just in the technology industry. Do you define a product as a clearly identifiable thingamabob that vendors sell, such as cars and ERP systems? Or are customers the real measure of products, based on the business problems that the product is supposed to solve?

While I'm sympathetic with the intent behind the customer-based definition, I think it's better to choose the vendor-based one. Customers have business problems that require solutions, which include one or more products. (Usually more than one, in the tech biz.) Vendors may be very good at providing one of the solution components, but they often run into trouble trying to do everything, even for clearly identifiable business imperatives like "keep us from getting sued for non-compliance."

Once you know what you're dealing with, the next step is to figure out when you're dealing with it. That's as true of products as it is of dark matter:

• If different groups in the company can't explain what it is, or what it does, or for whom, then it's probably not a product.
• If you have to go to extraordinary lengths to support it, it's probably not a product.
• If no one is responsible for the roadmap, it's not a product.
• If it's not possible to calculate the profit and loss for something, it's not a product.
• If you're having a hard time obsoleting something, it may be a product.
• If your partners complain that they don't have training and collateral for something, it may be a product.
• If you have to develop a supported configuration matrix for something, it may be a product.

And that's just the short list. If you know other ways to know products by their signs, feel free to add them to the Comments section.

White Bean Chicken Chili

I’m Eric Brown, a research director and 13-year veteran here at Forrester. I love to talk about topics like role-based marketing, customer experience, sales enablement, and healthcare IT.  I’ll be back to blog about those things another day.  Today, I want to talk about food.

In Cambridge, five of us on the tech industry marketing research team get together to make lunch for the group in rotation each Wednesday.  It’s been great — I recommend it (and not just because of ‘these tough economic times.’) It was my turn today, and I brought my White Bean Chicken Chili.  Well, not mine really.  The recipe is from Cooks Illustrated.  Email me and I’ll send you the recipe. 

Sharing a meal is very much the theme in the US this week, and so I’m getting my feet wet in the blogosphere to wish my peers, customers, and readers a Happy Thanksgiving. 

You're all a bunch of commies

Since I've been spending a lot of time talking with people about Agile, I've felt the need to concoct new, vivid metaphors to explain Agile. Of course, you can often best explain something by contrasting it with what it's not, and in this case, it got me thinking about the frustrations of non-Agile development:

• Very long project schedules. The more you throw into the release, the longer it gets.
• Unrealistic expectations of predictability and control. The more you develop, and the longer the schedule, the more your initial plan will contain inaccurate assumptions and expectations.
• Constant, top-down demands for compliance. Make the schedule. Meet the goals. Don't tell us how unrealistic they are.
• Unhappy workers. The rank and file struggle to keep their superiors happy. Cutting corners to meet production schedules and goals is the natural result.
• Unhappy customers. The recipients of product development discover, to their chagrin, that a product built to meet the producer's production targets don't necessarily meet the consumers' needs.

These complaints have a familiar ring. In miniature, technology companies have been repeating the mistakes of Soviet central planners, in creating the infamous "Five Year Plans" for economic development and production. And no, I'm not kidding in making this comparison.

Of course, there are huge differences between a software company and the Soviet Union. Middle managers aren't quite the same as the CPSU officials who looked over the shoulders of every factory manager.

Still, some degree of similarity is there, however unintentional it obviously is. Maybe technology companies don't create 3 million left shoes, with no corresponding right shoes, but they do create products that don't quite address their target business problems. Certainly, no digruntled developer gets sent to Siberia for saying that the schedule and goals are unrealistic, but they're often right in being cynical about meeting targets that no one believes are possible. (But everyone, of course, pays lip service to making them.) And, of course, rather than re-examining why the previous plan failed, many organizations focus instead on creating the next plan.

Agile isn't a perfect alternative to waterfall. Everything in this universe has its advantages and disadvantages, including capitalism and Agile. And, as Agile advocates are right to say, Agile techniques aren't necessarily a good fit for every project or organization. Still, it's worth taking a longer look into why particular approaches to organizing and governing work keep falling flat on their faces.

Your audience matters, not you

In my last post as a product manager, sales training did not top my list of favorite things to do. The problem wasn't the sales team, which was composed of bright, motivated people, with a genuine interest in what was coming next from the development team. Instead, the problem was with the format of sales training.

Who looks forward to three days of non-stop PowerPoint? Not me, and certainly not the audience. We had to come up with a better approach, particularly as the company expanded into new technology areas, such as records management and scanning. Therefore, we experimented with a few new ideas. Some worked, others didn't.

One of the moderately successful experiments started with the assertion, "Scanning isn't as complicated as people think it is. I bet that I could put a bag on my head, pretend to be the most stupid end user imaginable, and I could still understand scanning. Someone just needs to explain the basics in the most practical terms imaginable."

And here's the result:

We did a few other videos in this series, with mixed results. Hell, at least it wasn't another boring-ass PowerPoint presentation. The medium forced us to keep the message short, so we couldn't obscure the important essentials under a pile of details. Maybe the details mattered, but we had to get passed the initial expectation that anything connected to the word scanning was boring and complicated.

The moral of the story is, as a product manager, you go where your audience is. Not where you think they are, or should be. When you're writing requirements, or doing sales training, or anything else in your job, you have to know your audience, and find whatever medium works best for them.

Sales Enablement Roundtable - West Coast Style

NOTE:  SALES ENABLEMENT HAS A NEW BLOG 

 

On November 7^th, I facilitated Forrester’s second sales enablement roundtable – this time in Foster City,California.  Joining us were sales and marketing executives from:  Intel, NetApp, Borland, Informatica, Sun, Interwoven, Microchip, Renesas, Juniper Networks, Trend Micro, and Thoughtworks. 

Overall, we had an extremely high energy session, even though I lost my voice the previous week.  It’s hard to summarize a whole day of intense discussion into a blog post, but I’ll give it a try.

Facts about our group

• If you added up all of the revenue we represented (over $100B) we would have been the 56^th largest GDP in the world. To frame this out, that’s more revenue that every single business transaction, import, and export for the entire country of Morocco. Wow!!
• Our roundtable earlier in Virginiahas over ($350 B represented), which is more than the GDP of Denmark, and would have ranked 27^th in the world.
• All told, we’ve facilitated open dialog among executives who control and influence over $450 Billion – that’s close to bail out money folks.
• Attendees were mostly VP-Level, with a few director level folks mixed in. Some reported directly to the CEO, others VP’s of Sales, or VP’s of Marketing – but all are at a level close enough to know what the big boss cares about.
• We had a nice balance of people there from both sales and marketing backgrounds.  This allowed a very rich exchange between sales enhancement programs (like training, compensation plans, sales engineering, etc) and marketing’s role in sales enablement (content and program development, creating message architectures to help connect sales to content, adoption issues, etc)
• Even though our group sold: chips, hardware, software, and services – all of our challenges were very similar.
• Our attendees represented very complex businesses: multiple business units, various channels, global footprints, etc.

What exactly did we all have in common?

• There was passionate agreement over the key challenge being “overcoming random acts of enablement”. As the economy gets tighter – everyone is trying to prove how their “thing” is helping sales.  This results in a flood of noise and random activities that typically work against the objectives of the business.
• We talked through the common challenges and centered on the problem – we are trying to run a value communications process across individual silos.  We spent the first 90 minutes talking about common issues in each group – here were some of the highlights:

Product Silo	Marketing Silo	Sales Silo
Business unit construct creates problems inside-out thinking Product specific funding – “here is money – create a program for my product”	Gap between selling and marketing goals Design point – products, not problems	Transforming from transactional to value-selling model Training alone can’t do it because conversations must be about something.

What is the problem?

Lacking an organizing model or group, various activities to “help sales sell” create virtual chaos in the field. 

What are the implications of this problem?

Huge wastes in marketing expenditures and inefficiencies at the point of sales contribute to performance strains; both create major barriers to execute business strategy.

Too much risk in the selling model as 20% of the sales force generates between 60% and 80% of the revenue.

What’s the risk?

The IT market is shifting away from a siloed, command and control, model optimized to manage assets; to a more cross-functional, adaptive model optimized to provide service to business constituents.  As this shift occurs, we are seeing an engagement gap between those that have “cracked the code” to adding value to customers – and those who only provide capabilities.  As shift from IT to BT widens – we are going to see a new buyer / seller caste system emerge.

If you can address the product, marketing, and sales gap challenges – your company can effectively compete in the higher-order caste that will be rewarded with sustainable margins. If not, you should start looking for efficient ways to begin radically reducing the overall cost of sales because pricing pressures will not support current selling models.

What’s the answer?

Develop coordination across product, marketing and sales groups to facilitate valuable conversations, by creating a customer-centered framework to guide alignment, standardization, and consistency across traditional silos.

Forrester’s approach?

• Model (the customer)
• Map (products, messages and processes to customer model)
• Match (create a simple platform to help sales identify patterns in accounts and match then to appropriate plays)

As one of our clients told us, “It’s far easier to use our customers as our design point because they change a lot less frequently than we do!”

Implied by this approach – get off the deliverable mentality and develop a more service-oriented construct to supporting the sales force.  Invest in programs to achieve specific outcomes – like increase average deal size, rather than measuring usage patterns of tools, web clicks of advertisements, or other derivative metrics.  The key is working backwards from core business problems that can be measured in terms that move the dial on the balance sheet.

Parting Shots

The current state of sales support related efforts has reached a level of diminishing return.  You can only make so much improvement in product, marketing, and sales silos before you run out of room to have an impact.  The next frontier of sales enablement lies in the development of truly outside-in designed programs, created specifically to help customers drive adoption and are executed cross-functionally. Significant rewards await those that accomplish this transformation before their peers in the market as they will be able to achieve “strategic vendor” status in more large accounts, more quickly than their rivals – relegating those competitors to the commodity heap.

Scott Santucci

ssantucci@forrester.com

Now that's technology marketing

I suspect that there are two reactions to this video:

1. "Oooooh, cool! Now I want a Prime Computer!"
2. "Who the heck is that guy?"

Count yourself on one side or another of this dividing line of humanity. I bet some enterprising company could take this commercial, digitally alter it to include a different product, and still reach people in Category #1. (At least, consumers in Great Britain, and the attendees at the San Diego Comic Con.)

Patton's Patterns - Execution Lessons for Driving Sales

General George Patton’s unparalleled ability to execute in WWII sometimes gets overshadowed by his colorful (and stupid) public relations.  Because of his quick strike abilities, the Axis leaders feared him more than any other Allied general.  What made him truly unique, and someone still studied in military academies throughout the world today, was his formula for success.  Patton had a voracious appetite for history and believed that humanity already had a master inventory of all of the strategies and tactics for winning a battle. All one had to do was apply that knowledge to a given situation.  His success can be summed up by his ability to model, map, and match.

He was able to model the various elements of a particular battle (from tactics, troop movements, level of aggression of his opponent, terrain, initiative, strengths, weather patterns, etc.) to recognize patterns from an engagement of antiquity.  Having identified patterns, he was able to associate (or map) the actions of the victorious general to his situation, giving him a powerful competitive advantage - the collective trial and error wisdom of thousands of successful and failed tactics and strategies of the other generals of the ages.  Armed with the best advisor (the collective wisdom of centuries of peers), Patton was able to match winning tactics from the successful generals of the past to his specific circumstances rapidly and effectively. 

The results? 

In the nine months between August 1, 1944, when the Third Army began operations in

France

and May 8, 1945, when hostilities ceased, they:

• Liberated or captured 81,522 square miles of territory,including 12,000 cities, towns, and communities (27 of which had populations of more that 50,000),
• Captured 1,280,688 prisoners,
• Inflicted 1,811,388 casualties (1,280,688 captured, 144,500 killed, 386,200 wounded) against 139,646 of their own (26,809 MIA, 16,596 killed, 96,241 wounded),
• Destroyed 1,640 enemy planes while losing only 582.
• Destroyed the following targets: 3,833 tanks and armored cars, 4,337 locomotives, 3,664 factories, and 2,809 gun installations,
• Transported 2.2 million tons of supplies a total of 141 million miles and laid a total of 2,092 miles of rail to supply the Army. 

Why is this relevant to today, and for sales and marketing? 

Commodization is driving competitive pressures to levels never before seen in the IT industry.  To make matters worse, technology sales are also becoming increasingly more complex.

Given the velocity of change in today’s business climate, messaging and sales training strategies based on a standard sales presentation and basic training are antiquated business tactics that must be replaced with more flexible and adaptive processes. For starters, the required positioning content is bound to change too rapidly to be updated, rendering the messaging platform moot.   

In addition, training programs about products are no longer suitable.  The degree of discernable difference from one product set to another within an industry is so small that buyers struggle to tell products apart. It is much more valuable to help buyers figure out:

1) What the world will look like once your products and services are installed;

2) How to build a reasonable and accurate business case (note, I did not say ROI) for the project;

3) How to scope and staff the project team;

4) How to help the customer move from where they currently are to a more desirable outcome.

The only way to provide and continuously update this information is to focus on modeling patterns in your customers, mapping those patterns to frameworks to organize the material, and matching those frameworks to overall solutions, not just your company’s products, just as Patten modeled, mapped and matched patterns in the tactical and strategic military situation he faced.  By doing this in a structured way, you will be able to distribute the maintenance of content to many different people who have that information, update bites of information as needed, and help sales people locate the right material, for the right person, at the right time.

You mean we're not alone?

One of my dream projects is to compare product management in the technology industry to similar jobs in other parts of the economy. For example, there are people with the job title "product manager" in the biomedical industry. How different is their work from a product manager at IBM or SAP? (I know a little about our cousins in other industries, but that's not the same as doing the research.)

We also have the product manager-ish position of business analyst in IT departments. How similar are they to product managers?

Fortunately for me, we have analysts at Forrester who study this breed of cat. Mary Gerush just published a document, "Find And Grow Great Business Analyts," that includes the current status of the job responsibilities and requirements for business analysts. The similarities are more striking than differences, which leads one to naturally wonder how much product managers can learn from business analysts, and vice-versa.

Or at least commiserate with one another, since many of the challenges are the same, too. Amorphous job descriptions, a challenging mix of social science and computer science skills needed to do the job well--all that sounds very familiar. There are even people who have the title of "business analyst," but don't do what you think that particular job entails. (See a recent post on the Silicon Valley Product Group blog for more discussion of these points.)

It's also reassuring, in its own weird way, that business analysts have many of the same issues about reporting relationships. One of my least favorite projects, when I was working for a technology company, was a customer in the US military who had made split responsibility for requirements and implementation between two one-star generals. Surprise, surprise, there was friction between the business analysts and the developers. Both sides felt hamstrung by the other. Go figure. Both business analysts and product managers need to be persuasive, but good people skills are no match for big organizational impediments.

Still, as interesting as business analysts are, I also have a strong desire to research product management outside the technology industry. Even if the role is very different from PM in the technology industry, I'd expect the differences to be illuminating. For example, the pharmaceutical industry's burden of regulation certainly shapes the entire product development effort, including PM. Having worked with development teams that encountered the realities of regulation for the first time, I certainly would have liked to draw on a few lessons learned from other industries.

Upcoming Webinar - Sales Enablement In An Economic Downturn - November 6th

Join Brad Holmes and I for a look at what can be done to drive sales results in a down economy.  Forrester views "Sales Enablement" as a cross-functional disipline requiring product, marketing, and sales teams to work together to optimize results.

When:  November 6th, 2pm ET

Register:  Register now for this complimentary Webinar.

We will explore:

• Why buying executives only consider 10% of their vendors strategic.
• How clients determine which initiatives to cut and which to keep investing in.
• Why investments that support sales fail to get adopted and what you should do about it.
• How to create integrated programs to productize a solution selling activity and enable salespeople to sell at the decision point of project funding.

Our focus is more tactically oriented for this event (we have another, more strategic teleconference scheduled on Nov 13th), but we will walk through examples of end-to-end programs that have all produced tremendous results.