Month: January 2009
Pragmatic Marketing’s 2008 survey revealed that only 20% of its 1100 respondents are personally performing Win/Loss Analysis. We followed up with a straw poll to ask why; Why are you not doing Win/Loss?
The responses varied, but when we aggregated similar responses, the biggest categories were:
- I’m too busy
- I don’t own Win/Loss
For those who don’t own Win/Loss, frequently the sales team is responsible for it.
What’s wrong with this picture? I imagine that most of you would object to sales performing win/loss analysis, yet when I speak to PMs and PMMs, they are commonly unable to persuade executives to change the situation. What’s a person to do?
Too often PMs will argue on principle, but I recommend a different approach. Start by diagnosing the current attitudes, and look for the real impact of those attitudes.
- Diagnose the situation with management. If you don’t own Win/Loss, why is that?
- Determine your commitment to this company. Think through your diagnosis of management attitudes, and assess their willingness to consider a change. You may be pleasantly surprised that management has just been waiting for someone to step up to the plate, and you will be given a pilot project. But beware, dear reader. Changing cultures is hard work, may be unsuccessful, and may divert your career path unnecessarily.
- If you’re committed or have other reasons for staying, there are ways of starting small and showing some success you can build on.
Diagnose management’s attitude
You need to register your difficulty in performing your job without doing win/loss analysis. Beware though, too much complaining can weaken your position significantly. Once you register the problem, tell your boss that you’d like to have a discussion, and dissect the issue into a few distinct questions:
- Clarify the importance of Win/Loss analysis data. Does the company even agree that Win/Loss is important?
- If it is important, why? If not, why not?
- What function does management perceive for Win/Loss? What decisions should the data inform? Does your management see it as informing sales tactics, marketing messages, product direction, specific product requirements, or a combination of the above? For each task, ask why or why not, and whether your management views the current information as effective or sufficient.
After this management discussion, ask yourself whether the information coming out of Sales is effective at informing the activities above.
I won’t pull punches here: In my experience, Win/Loss is important for all of the above. There are, of course, other crucial sources of input for these decisions and strategies, but Win/Loss is among the most powerful and direct sources, and much less open to interpretation than other, less direct, sources such as analyst reports, competitive analysis, or industry articles.
Look for gaps in the information above, but you can also play on the “yes” answers. If management sees Win/Loss as important for messaging / positioning, then you can look at the Win/Loss information collected by Sales, and ask whether it is helping you do positioning.
Finally, look at the “no” answers. If management does not see win/loss as important for product direction, ask what sources they do think should inform product direction.
At this stage you are diagnosing the situation, not pronouncing judgment. If you remain open do diagnosing the situation, you will also be viewed as a team player and trying to do good for the company rather than yourself.
Consider each reason why, or why not, in the table above. Are the reasons valid in the current situation, political in nature, or simply a vestige of how the company grew? You may also be able to engage your management in the same discussion.
How committed are you?
With the information above, you should have some idea of whether change is possible at this company. You can now think clearly about your own commitment to this company or your current job. It is not easy to change a company’s culture or influence ownership, and it might be much easier or better to look for a company in which product management has a full mandate.
If you’re committed to sticking with it, at least for a while, you can start thinking about ways to influence change. Remember, this will take time, and probably more time than you would like. Wasn’t it Napoleon who first said “Change is a process, not an event?”
The key is to start with something fairly small. Here are some ideas:
- Ask for the Win/Loss reports that sales is producing. If you can’t get ahold of these, the situation may be worse than you realized; you’re not viewed as a “need to know” person on win/loss, much less having the mandate to perform the analysis yourself. Time to revisit your diagnosis and question of commitment.Assuming that you can get this analysis, read through it. My prediction is that the “wins” will talk all about diligent sales people, while the losses will talk all about product deficiencies, customer budgets, lack of need, or high prices. If these are the reasons, pick two or three accounts, and get permission to perform your own analysis. Get buy-in to the questions you’ll be asking, and publish your results narrowly to your senior management.
- Look back through your past releases. Often you put out a major feature that the field called a “must have” last quarter or last year, but once released, the resulting sales are disappointing. Create a backward-looking release chart that shows what sales asked for, what we built, and the resulting impact on revenue.
- Produce a discounting chart, and ask the question whether sales would like to reduce the need to discount. Plot discount vs. deal size, and compare the data to the standard rate card. Ask whether you can examine a few of the most highly discounted deals and some of the least discounted deals. What differentiates them? Were the discounts necessary? Money talks.
My bottom line is that proper win/loss analysis is crucial to a company’s revenue, profit, and decision making at all levels of the company. If you are responsible for product decisions, but you don’t have authority to do a good job of the analysis, you are flying blind, and doing a disservice to your investors, your customers, and your own career.
Please leave your comments, or feel free to contact me.
Previous Articles in this series:
We recently created a Twitter account for this blog.
Someone quickly reminded me of a post I made about Twitter not too long ago. When I posted that, a friend who had been on Twitter for some time told me that I just didn’t “get” Twitter.
Maybe I’m just getting older and I’m not as quick to jump onto the new new thing. But, I’ve worked in technology for over 20 years, so I certainly “get” most new technologies and their implications.
As I’ve started to use Twitter – and maybe there’s a frame of reference lesson buried in here somewhere — I’ve come to a realization: Twitter is the new Napster.
Huh? What do I mean?
I hope all of you remember Napster — not the new “legit” Napster, but the original Napster that made “file sharing” a household word.
What made Napster so popular was that it did one thing, and one thing only, but it was ruthlessly efficient at what it did.
Napster took all the complexity out of sharing files between individuals and groups. You didn’t need to know anything about file systems, directories, mount points, or the locations of anything. You simply found files that matched your criteria and downloaded.
If you wanted to share your files, it was equally simple. You just made your files available for uploading. And once you did that, they were available for anyone to access. The “network effect” of large numbers of people sharing files only helped increase the value of Napster to it’s users.
There were drawbacks to Napster. You didn’t actually know that the file you were downloading was actually the the file that was listed in the UI. For example — and not that this was something I did but — if you were downloading an MP3 file called “Sunday Bloody Sunday” by U2, it might actually be another song that someone intentionally misnamed.
There were other short comings, but people were willing to live with those shortcomings because the advantages — wide selection of files and singular focus — made it easy to use.
I’ve come to realize that Twitter is popular for exactly the same reasons that Napster was popular. It does one thing, and it does it with ruthless efficiency, and the “network effect” of increased users adds to that value. I had wondered why Twitter was so popular, besides being the new new thing.
I used to subscribe to Guy Kawasaki’s email list many years ago. There were thousands of people on the list who got Guys thoughts etc. every week. Now on Twitter, Guy has 50000+ followers, follows over 50000 people (I have no idea how), and has over 17000 tweets. These are at least an order of magnitude bigger than what Guy did on his email list.
The big difference: With the email list, everyone on the list was a subscriber and Guy was the publisher. In Twitter, everyone who follows Guy is also a publisher. Guy’s 50,000+ followers have in total probably 5,000,000 followers themselves.
Thus velocity that tweets can flow through Twitter, rebroadcast across followers means information can flow quicker and more efficiently than other communication formats like email or broadcast mailing lists etc.
And as anyone who has used Twitter knows, it still rather rough around the edges. It’s impossible to actually follow 50,000 people. In fact, following anything more than a few dozen active Twitter users is impossible without good 3rd party interfaces. But the efficiency and singularity of purpose make it attractive to a lot of people.
Now all of this may be self evident to a lot of you. If it is, then maybe my friend was right, and I didn’t “get” Twitter until now.
The future of Twitter is still not certain. Despite the popularity, they still don’t have a revenue model. And while the popularity and buzz is there now, it will eventually peak and level off and then the next new thing will come along and people will adopt that. It’s inevitable. Hopefully the new PM at Twitter, the executive team and the investors figure out how to monetize the service before then. Or if not, sell it for enough money to someone, who thinks that they can do that.
So, the survey is now closed. I’ll be looking at the responses, sharing them and commenting on them over the next few days.
While there were a variety of responses, most of them revolved around a few common themes such as maturity, organization, training, practices etc. Here’s one response from someone who seems to summarize many of the problems quite well.
1. What do you see as the biggest problems facing the technology product management profession today?
The lack of adequate portfolio management and planning. Poorly defined roles and processes for product management within organizations. Lack of executive support for Product Management (Senior level executives that understand the value of PM and are champions for it). Strategy execution and alignment are also important issues we have. Communicating the strategy in roadmaps and across the organization is an area I find many organizations lacking in, but also aligning the day to day product management task to the product and corporate strategy.
2. What solutions would you suggest to address these problems?
As a community we need to be able to precisely and clearly state the value proposition of PM to upper management, development and all other organizations PM touches. We need to form a community of practice that takes all of the best practices defined by StageGate, Pragmatic Marketing, Sequent Learning, ZigZag, PDMA, AIPMM and others and communicates the practical applications of these practices by industry. Focused more on real world application of best practices. Need to determine ways of measuring success within product management. We could probably take and adapt some metrics and performance systems for Corporate Performance Monitoring methods and strategy execution.
To whomever provided the above, all I can say is Amen!
More to come. Stay tuned.
But one I rarely hear discussed is that of Engineering reporting into Product Management.
To clarify, what I’m talking about is a structure where Engineering and Product Management of course, both report up into a VP of Product Management. i.e. Engineering has all the normal structures such as QA, Documentation, Development Managers, Program/Project Managers, Architects etc. etc. But that whole hierarchy reports up into the VP of PM.
I’m not saying that Engineering teams etc. should report into Product Managers specifically. Thus from an executive point of view, Product Management is held ultimately accountable for what is delivered in the product, but also has the authority to structure the Engineering resources as needed to optimize for the business goals they are trying to achieve.
Do you know of any companies where they’ve implemented this?
Are there certain situations where it can work or should be used?
What are the pluses and minuses here?
Whether you are an engineer, product manager or in another field, I’m really looking forward to your comments.
Want to help improve Technology Product Management? Does it need improvement?
If so, click through to the survey below and have your say.
It’s short and to the point. It’ll take 1 minute of your time, I promise.
Later this week, I’ll summarize the results and try to identify some solutions we can enact.
The survey will close at 11:59 PM EST on Tuesday January 27, 2008.
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Thanks for your input.