Inventing new strategies, and then implementing them successfully, is a requirement, not an option, to keep a company viable. If you're not moving ahead, you wind up falling behind.
from PRODUCT MANAGEMENT CHALLENGES A Newsletter of Tips For Companies that Develop Software.
In many companies, the management team, Marketing, and Business Development are full of ideas about where to take your product. They come up with all sorts of potential applications for it, applications that would be competitive and profitable.
These ideas sound great, but they have to be implemented before they'll make any type of substantive difference in revenue or profits. And once your team attempts to implement new ideas, it meets lots of resistance from the technical folks who are charged with that task.
Yet not expanding your product, not finding new avenues for revenue, not making changes that increase profitability, will only hurt your product and the company over time. The market and the competition is busily striving to improve and gain market share against you. Inventing new strategies, and then implementing them successfully, is a requirement, not an option, to keep a company viable. If you're not moving ahead, you wind up falling behind.
As with all new strategies, the chances for failure are high. If you want your product to grow and succeed, you must learn how to make strategies and ideas a reality. Read on for a discussion of how to maximize your chances of success.
Before you find yourself faced with the challenge of implementing new ideas and strategies, someone has to come up with them. This is usually the fun part.
Don't confuse brainstorming with planning. Brainstorming is the heady process of generating new ideas, kicking around alternatives, and challenging and polishing those ideas. After a good brainstorming phase, the results reflect a whole that is greater than the sum of the individual ideas proposed. And the people who have worked together to do the brainstorming feel inspired and satisfied.
But once you have generated ideas and debated strategies, you will need planning to make those ideas happen. Planning is the careful, matter-of-fact activity of thinking through all the steps you need to take to implement a strategy, and in what order. Your ideas are ready to implement only when there's a plan.
And the first thing that should be on your plan is the effort to measure how those great sounding ideas will appeal to the market, how much money they're likely to bring in, and how profitable they'll be. It's time to do market research, as formally or as informally as your organization can afford. You'll want to run the ideas by some representative focus groups to determine whether they will sell (and for how much money), and to be able to forecast revenue.
As an outcome of figuring out what it will take to sell the new idea, you'll be able to figure out the cost – cost to develop, cost to market, cost to sell. That will allow you to forecast the potential profitability.
With a profitability forecast, you can compare an idea's potential money-making power to other ideas. Normally there's no shortage of good ideas. But often the good is the enemy of the best. You want to apply your company resources to working on the best ideas, not just the good ones. And in most cases, 'best' means most profitable, though there may be other considerations: sales appeal, matching a competitor's capability, coordinating your strategy with a partner's.
As an outcome of studying an idea's appeal in the market and potential profitability, you reach a point where you make a go/no-go decision. Some of the most profitable decisions you ever make are the ones to not move forward with an idea that's less than great.
For certain exuberant personality types, the kind that excel at generating new ideas, saying you'll do something is the equivalent of doing it. But it will never be more than idea on paper until you put in a lot of hard work to build it and make it succeed. If the management team doesn't support you, as the Product Manager, in taking the many concrete steps to make a good idea a reality, you're not going to get very far. This is especially true for those members of the team that control the technical resources such as programmers and consultants, who will build and deliver the new idea.
It also applies to the people who coach the sales force to sell the new idea and its benefits.
You may find yourself in the position of having to win over people who are key to the project's success.
New ideas and strategies to grow your product fall into different categories. One common and successful strategy is to expand into a new vertical market. Take your product's benefits and make them work well in a specific industry.
The kind of work you'll need to complete in order to implement a move to a vertical market is likely to focus on such things as:
New products and services, on the other hand, are likely to involve not only lots of market research and new collateral, but extensive development of new capabilities. The challenge in this case is trying to break new development into phases, starting out small and simple, and becoming more complex and sophisticated as appropriate with each product release.
One critical focus of market research for a new product is working with prospects to determine the minimum acceptable set of capabilities needed in order to gain a foothold in the market. That minimum set becomes your first version of the new product or service.
The effort for new sales channels, when they do not correspond to a specific new vertical, may focus on tailoring the message and capabilities to the complexity of the sale. You may need to create a simplified version of your product for telesales and eCommerce. Or, to support a high- end channel, you may need to create a highly configurable version that comes bundled with extensive consulting and services.
Jacques Murphy tailors best practices in software product management to your company and products, creating competitive advantage through better product roadmaps, product requirements and product launches. Read more of his articles on this site or on productmanagementchallenges.com or via email at firstname.lastname@example.org.