280 Insider Newsletter
April, 2005
- Marketing Courage
- Working With Difficult Engineering Teams Part 3
- Product Manager's Toolkit v1.5
- New! Strategic Product Marketing and Management Training Course
- Book Review: Confidence
Marketing Courage
****************************
Since the 280 Group works with a lot of startups (and also with larger
companies that are trying to get breakthrough products off the ground)
we'll oftentimes get to be there when the tough go-to-market decisions
get made. This article sums up a phenomenon that we see far too often.
Being in Silicon Valley there are many technical and product visionaries. I talk to people every day that are betting their homes, their short-term livelihood, their quality of life and sometimes even their families (though they don't realize this at the time) on developing a product that they believe in.
Building a product takes guts. Even if you are a bootstrapper or you've hit it big in a previous job, you are still paying a large price in terms of opportunity cost and ego if you crash and burn. I applaud the engineers and entrepreneurs who have the courage to build products and take this risk. It is not a trivial decision to move forward - I know because I've helped build a few companies from scratch and have been there at the go/no go development point.
If you are involved with one of these companies, whether as an employee or investor, figuring out the answer to the next question early may save you an incredible amount of worry, concern and anxiety later. That question is: "Will this company have the Marketing Courage when the rubber hits the road?"
What do I mean by this? Well, oftentimes clients will bring us in when they are 3-6 months away from launching a product to help them plan how they are going to reach customers and make sales. Or they'll bring us in shortly after the product has been released and they can't figure out why sales have not begun to take off.
These companies will have spent tens or hundreds of thousands (sometimes even millions) of dollars, and months or years developing their product. They have a huge sunk cost that has been incurred to get to market. They'll ask the 280 Group to create a marketing plan to reach their target market as cost effectively as possible so that they can generate qualified leads and make sales. Their attitude is usually that "we'll be so smart about Marketing (like we were with development) that we will get things going without any real investment, and then we can fund future efforts from the initial sales." But when the rubber hits the road and the company has to invest significant time, resources and money to get sales going, oftentimes the courage they had to build the product turns into denial about what it really takes to build a business.
One company that we worked with had spent $3M doing a management buyout and bringing a new product to market, with the hope of turning the company around and generating $8-$10M in sales. When we proposed a ridiculously low Marketing budget of $50k (with some VERY creative leveraged marketing ideas) it took them 8 weeks of internal debate to finally decide that they weren't quite sure enough about the product and market to spend the money.
Another company that we worked with that had spent $800k to develop their initial product insisted that the only thing they needed to spend any marketing money on was their website. And even this they had an in-house engineer create, ending up making an impression on their customers that would never have had a chance of selling anything. We suggested at least upgrading the site and implementing some search engine optimization so that they would have a chance of getting some qualified traffic, but they opted to wait and see. Last we checked their site had a Google ranking of One, which was probably higher than their revenues.
What's the lesson here? Start your marketing and go to market planning very early - like before you make the commitment to build the product. Get real about what it will cost you, and get a seasoned marketing person involved to help you create a ballpark estimate. Take that estimate and double it as your working figure.
Sure, you might be able to come up with the next
completely viral product that requires no marketing, but these are few
and far between. When you are making the decision to invest in, join or
start a company that is going to build the next great thing, ask yourself
"When we have built the product, used up more funding than we dreamed
to do so, and are ready to really try to get the revenue engine going,
will we have the Marketing Courage to make it happen?". If the honest
answer is no, don't do it.
Working With Difficult Teams Part 3
****************************
Working With Difficult Engineering Teams Part 3
Ironically as I am writing this article about working with difficult teams I'm working with two excellent engineering teams. This is when Product Management is the best job in the world. As a Product Management professional you'll occasionally end up working with teams like this who are great to work with - they understand the value that you add, are incredibly talented and want to build great products that change the industry. In a future article I'll be writing about what to do to help build winning team situation like this, but for now I'll wrap up this series with a few more of what I call "Games Engineers Play".
In case you missed the first 2 articles in this series, here are the first five games that we covered:
Game # 1: Redefining Alpha or Beta criteria at the last
minute
Game # 2: You get your choice
Game #3 Changing Feature Definitions
Game #4 Features, Schedule, Performance: Pick Two
Game #5 Using The MRD Process To Stall For Time
So on to the final two games (and these two I sincerely hope you never have to play)…
Game #6: Sorry, but we have the final word
One engineering VP that I used to work with brought me into his office
at one point about halfway through a major project. As with any software
development effort, there were several points of contention between Product
Management and Engineering. We had been through one of the issues half
a dozen times and I had voiced my opinion that the release would fail
without a specific critical feature that Engineering had originally agreed
on including but now did not want to deliver. The reality was that it
was a very hard coding challenge, and would have put their schedule commitments
at risk. Nonetheless, it was key for our customers, so I was insisting
on it.
After politely explaining his position, the engineering VP informed me that he was "Sorry, but we have the final word on this. You will have to live with not getting what you want". I had suggested several reasonable alternatives - scaled down versions of the feature, pushing the schedule out if necessary and even funding a contractor to work on the feature. But he had made up his mind.
Defeated, I played the only card that I could. I cut the revenue forecast by 80% and let management know to lower their expectations. After all, this was a critical feature to drive upgrades, and without it there was little reason that customers would actually pay for a new version. Luckily I had a signed off MRD and spec as a backup that included the feature, but nonetheless I had been put in a difficult position.
In the end I lost on this one. The product shipped without the feature, and I was still held accountable for the original revenue forecast.
Sometimes there are just some things that are out of your control.
By the way, this is one reason why Product Management should NEVER report
into Engineering.
Game # 7: We Don't Talk To Marketing
Long ago when I was first starting my career in Product Management I actually
had an engineering team that refused to talk to anyone in Marketing or
Product Management. The previous Product Manager had been somewhat of
a tyrant, making ridiculous demands, oftentimes having completely disregard
for working as a team. As a result the engineers would hold secret meetings
to discuss the feature set and ship dates. They would not answer the phone
or reply to emails. They would keep documents hidden so that no one outside
of the core engineering team could comment or even know what was in the
release they were working on.
I have to admit, this was one of the most extreme cases of dysfunction I have had to deal with in my career. Nonetheless, I had to find a way to make it work. Luckily I had a very seasoned manager who supported me (and I also happened to be working on several other products concurrently.)
To solve the problem I pulled the engineering manager aside and informed him that my priorities had been changed to focus on the other products I was managing. As a result, even though I thought what they were working on had potential, I didn't think there was any way that the company would ship it since there wouldn't be any Product Management or customer input during development. I also added that even if it did ship the company wasn't likely to highlight it or market it, so few customers would end up using it in the end.
The product did end up shipping. It sucked. Customers were unhappy.
In the Product Management game you win some and
you lose some.
New! Strategic Product Marketing and Management
Training Course
****************************
Want to deliver better products and learn how to manage all phases of the product life cycle more effectively? The 280 Group in cooperation with Blackblot is now offering a two-day intensive educational seminar based on the Product Manager's Toolkit.
The Strategic Product Marketing and Management (SPMM) training course is a two-day seminar that builds the knowledge, skills and tools to effectively market and plan technology products and services. The course is based on the Product Manager's Toolkit ™ (PMTK) and PMTK Action Model, which teaches a best practices methodology to create market-driven products.
From now until August 31, registered 280 Group Product Manager's Toolkit customers in the USA and Canada receive 15% off tuition to the Strategic Product Marketing and Management training course.
For more information contact Brian Lawley at the 280 Group.
Product Manager's Toolkit v1.5
****************************
The Product Manager's Toolkit version 1.5 is now available, including updated MRD and PRD document templates as well as a totally revised Business Case template. Use the toolkit to become a better Product Manager by leveraging best practices and proven methodology.
Note: Registered customers of the Product Manager's
Toolkit comes receive unlimited updates and upgrades.
Book Review: Confidence
****************************
Why does a sports team continue its winning ways even though recent teams lack the talent of their predecessors? Why are some companies always positively perceived by employees, customers, Wall Street analysts, and the media while others seem to be under a perpetual cloud? How does a company like Gillette or a team like the Chicago Cubs end a losing streak and breaks out of a circle of doom? What does it take to bring an organization like Continental Airlines or the BBC from mediocrity to magnificence?
These are some of the issues and examples that you will discover when you read “Confidence – How Winning Streaks and Losing Streaks Begin & End”. Author Rosabeth Moss Kanter will convince you that the goal of winning is "not losing two times in a row". In her view, success and failure are not events, they are self-fulfilling tendencies. "Confidence is the sweet spot between arrogance and despair--consisting of positive expectations for favorable outcomes." says Kanter, a Harvard Business School professor.
She applies the discipline of cognitive psychology to explore the winning and losing streaks of a variety of organizations, including the BBC, Gillette, Seagate, Verizon, Continental Airlines, Target and sports teams such as the University of North Carolina women’s soccer team, New England Patriots, Chicago Cubs, and Philadelphia Eagles. The result is an enlightening anatomy of the behaviors, decisions, and actions that build and restore confidence, and lead to positive outcomes.
Drawing on dozens of interviews, Kanter logically explains the role that confidence plays in the performance of institutions and individuals. Winning streaks are fueled by confident people who are secure in their own abilities and the ability of their leaders. Winning streaks are characterized by continuity and continued investment, while losing streaks are marked by disruption and a lack of investment that typically give way to a self-fulfilling prophecy of failure.
Losing streaks are often created and then perpetuated when people lose confidence in their leaders and systems. Combining theory with practical advice, Kanter details how losing organizations can instill accountability, collaboration and initiative—Kanter's three pillars of confidence—to help start a turnaround.
While the book is filled with helpful lessons for organizations, there is plenty for the individual to take away and integrate into his/her own life. That is, our own attitudes…positive or negative…contribute significantly to the outcome of specific situations within our lives. Success and failure can both be contagious. Small steps and accomplishments can have a big impact. Confidence can sometimes outweigh raw talent.
Even under the most challenging situations, confident
leadership and behavior can help unleash positive energy. Whenever we
find ourselves under trying circumstances, it is an inspiring reminder
of the value of “Confidence”, a book that I highly recommend
to all readers.
See it on Amazon.com
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