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Program Management and Business Operations Executive

Hi, I'mDavid Haddad

Strategy/Corporate Transformation Executive

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Evolution of the Life Cycle Process

In my career in program management, I have worked for many different types of companies. These companies have all had problems at one time or another determining what their focus from a process point of view should be.

My view of process is one of evolution. As a company advances, the LCM process expands to incorporate more activities. This does not necessarily mean more ridged processes but parallel tracks which optimal processes and a change in focus of governance to accommodate those changes.

Similarly to Maslow’s Hierarchy of needs, here is my corporate hierarchy of needs. (May the pyramid builders of Egypt take pity on me!)





Incubator Company
When a company is forming, the primary focus is funding
. The company cannot even form unless it secures a revenue source. The group of funders will be visiting Venture Capitalists, and hocking their idea, their founder’s previous success and trying to secure enough funding to get the company off the ground. There is no need for process at this point beyond coordinating with the founders on marketing material, scheduling presentations, etc.

Start-Up Company
With funding secured, the primary focus is to get a viable product to market. (Most likely to secure a second or third round of funding in the hopes of an IPO). The corporate focus at this time is engineering. Engineering is the be all and end all, they are asked to do miracles in hopes of hitting ridiculous dates for shipping product.
Process has evolved into Project Management. Scheduling and tracking of all of the deliverables of the various engineering organizations (Hardware [ASIC, Board, Chassis, etc.], Software [Development, QA, Documentation, etc.] and Operations [supply base, managing OEMs, etc.). The goal is to keep track of what is behind schedule or having issues. Typically that is the only interest of the company.

Small Company
Congratulations. As a small company you are self-sufficient. You have a revenue stream and are hopefully at a break even state or enough funding so the company’s focus can change. You are expanding your portfolio to include multiple types of different product lines. Your roll is typically as a component vendor. You are trying to steal market share away from the business competitors.
The Engineering project management is now delegated to the engineering VP. The company’s life cycle model changes to become more cross-functional with a focus on new product introduction. A process that handles the expanded roles of not only engineering and operations but finance, global services, marketing, regulatory, etc. Get the next widget to market is your mantra.

Medium Company
Your company has grown to become a well-known brand in the market and garners a growing share of the TAM. The market leaders views your company as a threat. Smaller companies are trying to take away market share from you. The company moves from a product base to a solution base portfolio.
Just as in the Small Company phase, the New Product Introduction processes are relegated to a team of Technical Program Managers who keep the machine going. This governance is now one of a business unit management. As your company grows, the focus now moves to a revenue generation phase. The corporation main focus will be on Sales and revenue attainment. As opposed to an engineering focus, you start looking at what action needs to take place during development to make sure that all is in place when the solution is ready, so if the field. CMO, Product Marketing, Sales, and the Channel are trained, understand where to sell and how to position the product. The goal should be to introduce solutions that will garner you a lead position in the market.

Large Company
Your company is the top dog, you own a majority of the market. You are a widely known brand. The company is now major focused on market retention and warding off competitors in your market space.
Your corporate processes should now be aligned with your “brand”. Your processes now expand to include social responsibility issues, customer fanaticism, political stands, etc. These processes will help secure your base of customers and bred loyalty. I have heard customers say things like “We are going with company x because no one ever got fired for deploying their solution.”

Hardest / Most Common Point of Transition: Small to Medium Evolution

Your process of focusing on new products has worked out great so far. You have your company working like a machine moving products out the door. However, most likely your hyper-focus on new products means you are not looking to how they are performing in the market once they are launched.

In the small company scenario, there is little attention paid to the promise vs the delivery. At the start of the program, a product manager may promise the moon, sun and stars to get their program funded. With the revenue they promise to obtain, surely the company will grow.

The program is approved, the money invested and that is typically the last time the revenue projections are looked at on a product/solution level. The product ships, sales are poor, revenue is not attained. And then we repeat with the next product/release down the line targeting the same sub-TAM where the products are failing to attain traction. While this may keep things moving, it does not advance your position into the market owners.

Another common mistake

For this example let’s lay down some data to highlight our example. 

Consider a product which is targeted to hospitals. The product manager targets this products to large urban hospitals. The TAM is 20 Billion dollars. The product is expected to capture 10% of the market (3% first year, 7 % second year and 10% by the third year).

The roadmap for this product solution looks like

All releases deal with features for the specified use case. Typically as the challenger, you are behind the incumbent with respect to features. So each triangle specifies a bundle of features targeted for this use case.

The first release happens and voila the market share and revenue do not materialize for some reason. Most companies at this stage do nothing. They are focused on the next new widget coming out worried that engineering may slip a week or two. Even if the company does a retrospective, against the revenue, the product owners will speak to changing market dynamics, an unexpected competitor’s entry into the market, downward pricing pressure from the market leaders, and feature disparity, etc. No action is typically taken other than a promise to do better the next time.

The roadmap for feature development does not stray from the targeted market. (The one the company is not being successful in).

The company ends up in a cycle of “wash-rinse-repeat”. The same reasons can be recycled every retrospective. No one questions anything because again, the next widget is coming down the bunny trail.

Sales LCM

What if we added something to our process? Namely a parallel process which focused on achieving the revenue as opposed to achieving the delivery of the product. Revenue is not based solely on the “right mousetrap” but in the company’s ability to get that mousetrap to market effectively and efficiently.

Questions to Consider: The five Ws and one H of journalism and LCM

According to an article written by Lori Soard, first year journalism students learn about the five Ws (Who, What, Where, When and Why). Add in the one H (How) and now you can start to see the questions that the Sales LCM will be based around.

Market Assessment

The corporation should be considering what market the company wants to get into? What does the TAM look like? Is the market growing? How fast is it changing? What market adoption curve phase is it in? What do the market sub-segments look like? What are the routes to market, size of the sub-segment, types of customers, etc.? What is the current vendor split (top three competitors)? All the “whats” that come into determining where the company can win and win big.

 

Product Description

 A description of the product along with a roadmap for assessing when the “market viable” solution being proposed are targeted for completion.

Revenue and How we get there

An LRF projection of what the proposed revenue targets are would be considered as is probably the norm in your current LCM process. However, the difference in this LCM is that the core team becomes focused on what needs to be done from day 1 of development to achieve these revenue numbers. This would include assessing Sales resources and current Sales productivity numbers, size of pipeline, number of routes to market, sales cycle, etc.

What the core team is addressing are all the non-engineering elements which are essential to hit the revenue targets. What is expected out of the Sales organization? What is expected out of the Product Marketing/CMO organizations? What does Product Management need to do?

Inexperience companies I have researched may have a product which has a year sales cycle. Given their LCM process, they may not start engagement with Sales and customers until two weeks prior to the First Customer Ship. The company will sit back and wonder why sales are not materializing.

This has a feeling of a Forest Gump moment.  “You told me it takes a year to sell this product so why are you expecting for any revenue now?”
Planning and managing all the items identified for a successful product launch (Sales Training, Field engagement, demos, betas, customer engaged field trials, routes to market engagements and training) much be mapped out and planned for. Tracked and rolled out in conjunction with the product.

Hunting in the Wrong Field

 In our earlier example of selling to a large hospital TAM, how does the company know if we are succeeding or failing in our efforts? Does the data collection process exist to determine where we are selling our products? If it does not, then as a medium size company, you need to start creating the point in the company to collect that data effectively. I recently received a notification from my water company that I was using more water than my neighbors. With four people in the house, no outdoor landscaping, no pool, no hot tub I was stunned. When I inquired to the water company, the reply I received was that the data used by the company that was contracted out was fabricated. So no matter what actions I took, showering at work, low flow toilets, bathing in my neighbor’s back yard nothing would matter. I would still be a water waster.

For the sake of the next example, assume that the company has the data at hand. Here is the data on our Market Traction after one year.

When the analysis is completed, we determine that our competition is entrenched. They are offering a solution that is superior to us and have a fantastic brand. Our company is behind on features. So what does the medium company do? Stays the course. Perhaps try for the price sensitive areas of the TAM. Invest more funds to try to increase (or keep) our tiny slice of the pie. We continue on with our roadmap and make every effort to win deals with individual customers by promising (and delivering) on unique features for them.

However for all the efforts put forth, the company (most likely) will never become a contender in this segment. The efforts to support these unique features will only leave the product farther behind in key capabilities as resources are diverted. If this is the only play for your product, the company may want to consider abandoning it in favor of finding more fertile grounds.

But that might not be all of the data

The company may see traction for its products in a related but unexpected segment. The company should then determine if it should reprioritize its focus on these new TAMs by investing the features, functionalities and requirements of these areas. The roadmap will be updated for these sub-segments. If the right combination can be found, the company may be able to become the established market leader.

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