Category Archives: Win/Loss Analysis

Product Management Metrics (part 2a)

My  conference call on PM Metrics with Tom Grant went quite well yesterday. It was a round table discussion with good points made by several participants.

While we did talk about a number of topics, the metrics discussion dominated the first 1/2 of the call.

One of the questions  — What metrics should be used to measure the effectiveness of Product Managers? — got me thinking a bit.

My answer on the call was that first the focus should be on metrics for the Product Management organization, and then a breakdown from there on metrics for individuals based on objectives and tasks that support the goals of the organization.

To me that seems like a logical approach, because all other organizations in a company, includes sales, marketing, technical support etc. have metrics defined and measured that way.

So what’s the problem?

So why is it so hard to come up with metrics for the Product Management organization? Well,  it goes to the heart of the major issue with hi-tech Product Management today.

And that is that most companies don’t look at Product Management as a holistic function within the company, but rather as a set of individuals or small teams working on a variety of product related tasks.

Look around and see how the focus of Product Management is different in different companies.

Look at how widely the reporting and organizational structures are for Product Management. It is part of Marketing in some companies, part of Engineering in others, a standalone department in others.

Look at the ongoing debates related to when Product Management roles should be defined and introduced in a company.

If you’ve worked in or have been exposed to Product Management in different companies, compare and contrast the tool sets (or lack of them) used by Product Management organizations versus the tools used by other departments to do their jobs.

And if people don’t look at Product Management and it’s objectives in any holistic and standard way, how can they set about defining and measuring key metrics for the Product Management organization?

Metrics should focus on measuring intended outcomes

For Sales organizations, the key metrics  (product sales/bookings etc.) are directly tied to the intended outcome of the function: generating sales and revenue.  There are numerous secondary metrics that are tracked such as  sales breakdown by product/product family, by deal size, by geography, by new vs. existing customer etc.

And don’t forget all the sales funnel metrics that are used to track progress and success, such as average time to close, win/loss ratio etc. The important metrics are clearly tied to the intended outcomes of the activity of the sales organization.

For marketers it’s a bit more complicated because there are different roles in marketing and different intended outcomes. The two primary outcomes that can be applied to marketing are related to lead generation and market/industry awareness.

And from there numerous metrics can be identified related to number of leads, cost per lead, lead quality, lead to prospect conversion ratio etc.

Metrics for awareness are numerous, but basic metrics focus on “mentions” by press, analysts and other influencers in publications, reports, blogs, and via social media such as Facebook and Twitter.

And what of Product Management?

What is the primary objective of Product Management? In a previous article on this blog entitled Product Management Metrics (part 1), I defined the mandate of Product Management as:

To optimize the business at a product, product line or product portfolio level over the product lifecycle.

Don Vendetti of Product Arts, wrote a series of guest posts, entitled Measuring Product Management. In part 3 of his series, he provided his definition of the Product Management mandate:

To deliver measurable business results through product solutions that meet both market needs and company goals.

I like Don’s definition.  Both definitions share the same spirit about business focus,  but Don’s phrasing is clearer and more explicit than mine. But I do think that mention of the product lifecycle is needed because that has a huge impact on the objectives and the required focus of Product Management.

Don’s use of the words “measurable business results” is crucial to this discussion.

So what are those business results? Well it depends on the business and the company goals. 🙂

Those goals depend on the many things. Some companies care about revenue. Others care about market share. Others care about profitability. Others only care about getting acquired. And those goals can change with time.

Some choose to be technology focused, while others are sales, marketing or market focused. Some companies have a single product, while others have portfolios of products.

Depending on the company’s goals, size and level of maturity, the market conditions, it’s financial status and it’s overall strategy, Product Management’s objectives will change and so the metrics to measure Product Management will also change.

I’ll stop here, but I’ll pick up this discussion in an upcoming, and long overdue post that will be entitled Product Management Metrics (part 3).

Make sure you read Part 1 and Part 2. 🙂

Saeed

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The Power of Differentiation

Have you ever walked by a hot dog vendor on the street and wondered how they compete with other similar vendors?

If you haven’t, that’s understandable. If you have, you’re likely an overworked Product Manager.

Do they try to differentiate on price, location, variety of condiments, selection of drinks, cleanliness? Do you think they even think about differentiation?

They probably don’t think about it much unless a competitor co-locates very close to them.

Regardless, have you ever seen a hot dog vendor with line ups an hour long? Do you think major international media outlets would take turns interviewing one particular vendor in a major city?

Well, this is exactly what happened to one specific street vendor during the recent Winter Olympics in Vancouver.

The vendor is known as Japadog, and serves a unique variation on the frankfurter. Japadog can most simply be described as a Japanese take on hot dogs.

Most of the meat in the buns is either beef sausage or bratwurst, although they do offer fish sausage and promise a Kobe beef sausage  in the future.

Toppings include items such as seaweed, bonito flakes, mashed potatoes, cabbage, teriyaki sauce and Japanese mayo. Here’s the menu from one of their cart locations.

(click image to enlarge)

While this may sound strange to hot dog traditionalists, it’s incredibly popular with Vancouverites and visitors to the city.

The media attention received by Japadog, particularly during the recent Olympics, made it so popular that expansion plans to other cities are in the works.

The lesson here is simply a reminder of something we all know, but often forget. Differentiation is your friend. Find a unique way to position and offer your product to the market, particularly when the market is commoditized (as is the case with many hot dog vendors), and you create the opportunity to rise above those competitors and attract both market share and recognition.

Look at virtually any market leading product and you can usually clearly identify how it’s makers created compelling differentiation  from it’s competitors.

And for those of you who want to learn more about Japadog, here’s a short video.

Saeed

The Origins of Product Management (part 1)

One of the common problems when discussing the subject of technology Product Management is that there is no common definition of Product Management that all people agree on.

To better understand what Product Management is, it’s important to understand where it came from.

The origins of Product Management go back to the 1930s at Procter and Gamble. Back then, a manager at P&G named Neil McElroy wrote what is now referred to as the “McElroy Memo”.  P&G was famous for their culture of writing memos on important topics.

McElroy was the manager responsible for Camay soap — a lesser brand to the company’s leading Ivory soap brand. Camay was not selling well and he decided that a dedicated “brand man” (and supporting team) was needed to ensure that sales of the brand were being maximized.  Here’s an excerpt from that memo describing some of the issues that the “brand man” would need to address.

  1. Study carefully shipments of his brands by units.
  2. Where brand development is heavy and where it is progressive, examine carefully the combination of effort that seems to be clicking and try to apply this same treatment to other territories that are comparable.
  3. Where brand development is light:
    1. Keep whatever records are necessary, and make whatever field studies are necessary to determine whether the plan has produced the expected results.
    2. Study past advertising and promotional history of the brand: study the territory personality at first hand–both dealers and consumers–in order to find out the trouble.
    3. After uncovering our weakness, develop a plan that can be applied to this local sore spot. It is necessary, of course not simply to work out the plan but also to be sure that the amount of money proposed can be expected to produce results at a reasonable cost per case.
    4. Outline this plan in detail to the Division Manager under whose jurisdiction the weak territory is, Obtain his authority and support for the corrective action.
    5. Prepare sales help and all other necessary material for carrying out the plan. Pass it on to the districts. Work with salesmen while they are getting started. Follow through to the very finish to be sure that there is no letdown in sales operation of the plan.
  4. Take full responsibility, not simply for criticizing individual pieces of printed word copy, but also for the general printed word plans for his brands.
  5. Take full responsibility for all other advertising expenditures on his brands (author’s note – in-store displays and promotions).
  6. Experiment with and recommend wrapper (author’s note – packaging) revisions.
  7. See each District Manager a number of times a year to discuss with him any possible faults in our promotion plans for that territory.”

Putting aside the lack of gender neutral language (i.e. Study carefully shipments of his brands by units), here’s a summary of the 7 points:

  1. Understand the regions and volumes of product being shipped.
  2. For regions where sales are good or growing, understand why and try to apply those principles to other similar regions
  3. Where sales are light, investigate the situation to understand the problems. Devise a plan to address the problems and work with internal parties to ensure the plan is successful.
  4. Take charge for all messaging and advertising copy for the brands
  5. Oversee advertising and marketing expenditures for the brands
  6. Try new things, particularly with packaging of the brands
  7. Work with local sales managers to understand their perspective on what is and isn’t working in their region

It’s an interesting list. In essence, the “brand man” is responsible for the business success of the brand (product or product family).

The role of “brand man” or “brand team” was very successful at P&G and was emulated throughout the consumer packaged good industry.  And, after almost 80 years, Brand Management is well defined and is a pure marketing and business function within Consumer Packaged Goods (CPG) companies.

The story doesn’t end here, but it’s clear that the principles of brand management had a significant role to play in the formation of technology product management.

Saeed

Related articles:

Steve Johnson on Win/Loss, Ivan Chalif’s Digest, and Alan’s musings about the discipline of PM

Steve Johnson has probably taught 50,000 people how to do Win/Loss Analysis. Here are his views on Win/Loss Analysis. We couldn’t agree more.

Ivan Chalif at The Productologist has also posted a PM Digest for the week of August 4. Cool idea… here it is.

Ivan, thanks for including us. Steve, thanks for the plug.

I’ve been amazed recently at the growing buzz on Twitter and the growing number of PM-related blogs. For a long time I have felt that the discipline of Product Management is not improving much, despite the improvements made by indvidual Product Managers. Product Management as a discipline is still in its infancy, and still immature.

Is social media providing a light in the tunnel? I see Twitter beginning to help us all collaborate. If you are wondering what I mean, tune in to the #prodmgmt tag on Twitter.

Unconferences are also popping up all over North America (and Europe?) in much the same way that PM Associations were doing in the early 2000’s.

I wonder how we might accelerate this to collaborate on something even bigger. We (mostly Saeed) have talked in the past about the need for a PM Manifesto, akin to the Agile Manifesto. Perhaps this is a topic to pick up at the Austin Product Camp: How can we move our whole discipline forward? I might just propose a session. Tell me your thoughts.

– Alan

OnPM speaking @ pcamp NYC

Hi folks, Alan here. I can’t actually promise that I will be speaking at Product Camp NYC. Why? Because this is an unconference, and the participants will choose the topics and vote with their feet. I love the concept. How many conferences have you attended and wondered why you paid to hear these people speak? In this case, the conference content is determined by those who show up, not conference organizers trying to gauge interest months in advance.

I’ve pasted my abstract below. If you are not attending this event but would like to discuss this topic, please let me know and I will host a webinar in the future.

If you want to check in on what’s happening, there are a few ways to do so:

If you are attending, come find me and say hello.

– Alan

Presentation Abstract

You can’t fix what you don’t understand: A Practical Guide to Win/Loss Interviews

Buyers (wins and losses) hold keys that can help you diagnose and improve many of the most vexing problems in your business. Yet 90% of your peers – and your competitors – ignore this powerful source of market information.

In this session I will present some practical tools that you can use as soon as you return to work. Attendees will determine the specific topics, but I will be ready to discuss practical topics such as:

  • Where to start? How to focus your analysis by picking a high-impact problem to solve. Bigger Deals? Discounting? Competitive Intelligence?
  • Why sales should be banned from win/loss reporting
  • The final answer vs. Replaying the interaction
  • Discounting and Pricing Analysis
  • Selling to the whole buying circle
  • Who cares about Win Analysis?
  • What to do if you are not allowed to call accounts.
  • How to get lost accounts on the phone.
  • How to gain management support.
  • Competitive Intelligence using lost deals

Bring your questions!

Summer’s here: Do something different

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Yes, summer is here, and the vacations are beginning.

Many of your co-workers are using this time to check out of their responsibilities, take a slower pace, to take some time off. Expectations are often lower in the summer, and your boss may also be checking out to some degree.

I am in favor of vacations, and you must take time to relax and be with friends and family.

But you should also use the summer strategically. Deliberately lower expectations of specific deliverables, and work on something for the fall. My suggestion: start a campaign of calling and visiting buyers. Kick off a series of win/loss analysis calls. Design and conduct a customer survey. Set a goal of writing a whitepaper or an ebook.

Use this time to do something different.

Use this time to tee things up for September.

When everyone returns to reality in September, what would really impress your executives or your team? Focus on that and slow-roll other projects.

Oh, and take some time off.

– Alan

PS: If you want some tips on conducting win/loss analysis, here are a couple of articles that will help:

Podcast with Tom Grant of Forrester

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I recently had a good conversation with Tom Grant of Forrester Research.

We discussed a number of topics including organizational structures for Product Management, the maturity level of Product Management, Win/Loss Analysis and other related topics.

And then Tom stumped me with what should have been a very easy question about my favourite authors.

The podcast can be found here: The Heretech Episode 11.

Saeed