So in my last 2 posts I wrote about couple of areas, on how as a product manager, I would get my forecasts wrong.
In this one, we will talk about competition. Whenever there’s a good market, you will have competition come in, sooner rather than later. The more the competition, the more the challenges because you have to estimate in advance how competition would react to your offering.
The advantage of the B2B market is that generally, the competition is defined. Until a rank outsider comes in with a revolutionary product, generally the B2B space is defined and the products/services are also known.
In the market – perception is the reality. So if your competition creates a perception of a superior product/service or a cheaper service or a more flexible service, then all your forecasts can go haywire, if the market believes that your product is inferior in any way / more expensive / less flexible.
When you are working with a specific software tool or you are a partner for only a specific kind of equipment, then your options for differentiation decrease. It limits you to primarily two things – experience that you have and the kind of technical expertise that you have created.
If its your own product/service you can leverage on other things like the kind of packaging that you do, or the software code that you have built.
From a competition perspective the other thing that you need to note is the number of sales people in the market from your competitors versus yourself. If you have 3 sales people while you have competition with 7 sales people each, then its not practical for your team to outrun the competition. Your competition will always have more people covering more accounts. Which means your chance of losing a deal is always higher. Planning without this aspect clearly articulated in your assumptions is a grave mistake.
But marketing – especially in B2 is very interesting because of these factors.
Till next time then.
In yesterday’s post I wrote about how your plans and forecasts go wrong, if the product on which you have based your service model itself doesn’t succeed or the OEM loses focus.
Today we will look at other aspects where because we didn’t see the obstacles in advance, we couldn’t meet our forecasts. This is again from a B2B perspective where we were involved in direct sales to customers.
One big gap which generally arises when we the product managers, do forecasts, is discounting the human factor. We are so focused on the positives of our product or services that we forget that our product has to be sold by someone. I have tried giving targets and I have tried to get sales people to create their own targets and I have failed in both situations.
The key reasons I think, are because we believe that human beings will work consistently like a machine. We lose focus quite fast. If you have to ensure that your forecasts don’t fail then you need to incorporate the factors which can get your persons de-focused.
So think in terms of what all obstacles may come up that you will need to face and what will be your plan. This doesn’t mean that other things can’t go wrong. Its about figuring out what all you can think of in terms of the obstacles. Also understand that I am not looking at moves your competition will make.
As an example one project execution has not gone as per schedule….and your sales person has to hand-hold the customer. How will he make the sales calls then. What happens if half your sales force leaves together or spread across the year and you are not able to hire the right kind of sales people on time. In B2B sales where the lead times are high getting the new person fully operational is a very big challenge. Same could happen on your delivery side.
The more assumptions about your plan that you can call out in advance, the better you can work your forecasts.
Till next time then.
In product management, one of the key things that is expected is building a market forecast and then getting a budget approved.
Being in a services space, our services were centered around some software products. Which meant that if the software products didn’t sell our forecast would be worthless. So the OEM being able to sell the product was critical. As an example if SAP becomes a leader in the ERP space then all the service providers who have capabilities around SAP have a large market to target and their business will grow.
Generally I used to map all the people, at the OEM, who were involved with the specific product. These people would also help lead us into customer requirements.
Now the challenge is that most people who are part of the same team will generally always give the same pieces of data. Therefore there was a bias in the data that was being fed to me. Now since I was also invested heavily into the relationship with the OEM, I was also not willing to see if there were somethings about the data which were not ok.
Just to put things in perspective, this same method had also made me immensely successful as a product manager. The key was that at that time the products were successfully getting sold by the OEM, so that momentum also helped us sell a lot of the services.
As they say , failures give you lessons , to succeed to the next step. I realized I needed to meet people who were not involved with that product within the OEM and outside to see how they were performing. I also started asking questions of why its not a good idea to go with that product.
This helped make my investments into building service capabilities around specific products more rational. It also helped me push the technical team to create more cross functional capabilities.
As a product manager or marketing manager you have to learn to find a way to not fall into the dual traps of group think and confirmation bias.
Till next time then.