Product Propositions

7/29/2019 Product Propositions

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The UK’s Leading Reerence or Telecoms & IT

ProductManagementJournal Volume 2 £10

ContentsDeveloping a Proposiion The imporance o unearhing wha cusomers value p04

Persona Proling Geting ino your cusomers’ shoes p11

Thinking BigProposiions or big soware producs p14

Lisen and LearnCusomer eedback need no cos he earh p18

Insigh: The PowerWhy produc managers need proposiions p22

PropositionsHow to build sharper

propositions that really work



Training

0207 099 5567www.producocus.com

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Be more eecive



PROPOSITIONS

Product Management Journal Volume 2 3

Why should I buy rom you? I a cusomerasks his quesion are you conden ha you

have a convincing answer? The answer isyour proposiion – a clear saemen o he

benes a cusomer ges rom your ‘complee’ soluion.

Your proposiion is more han jus yourproduc; i’s all he pricing, services,processes and 3rd pary elemens hacreae he complee soluion experienced byyour cusomers.

Do you know which elemens are valuedmos by your cusomers? Have you made ieasy or hem o compare and choose yoursoluion raher han he compeiion? Haveyou clearly ariculaed your proposiioninernally as a vision or developmen, produc markeing and yoursales channels? I he answer o any o hese quesions is ‘no sure’ henyou need o read on.

From our experience across he indusry and rom eedback duringour raining courses we know ha many people eel weak in he area o

proposiion developmen. Tha’s why we’ve decided o ocus his issueon proposiions.

The aim o our Journal is o provide useul inormaion on relevanopics or produc managers - ips and insighs o help you do your job.We hope you nd i useul, we hope you’ll hang on o i and we hope youenjoy reading i.

Who’s who?The Product Management Journal ispublished by ProducFocus as an independenpublicaion or UKproduc managers inTelecoms and IT. ProducFocus is run by IanLunn (op) and AndrewDickenson (below) .

Produc Focus can beconaced by visiingwww.producocus.comor calling 0207 099 5567.

WelcomeLeading the way or product managers in Telecoms & IT



Every produc is par o a proposiion your business presens o iscusomers even i you haven’ been hrough he process o analysing

exacly wha i is. A proposiion should be a clear saemen o hebenes a specic group o cusomers ges rom your soluion. I

should ocus on how he benes address wha cusomers really wanand wha diereniaes you rom he compeiion.

As a produc manager, you’ll nd proposiions exremely useulhroughou he produc liecycle. In heearly sages hey orce you o hink abouwhy you are developing a produc and whycusomers will buy i. During developmenhey help you o pain a vision ha hedevelopmen eam can undersand andwork owards. A launch hey provide highqualiy conen or markeing o developbrochures and oher collaeral. And, in-liehey provide he key argumens o helpyour sales channels sell your produc (seeTable 1 on page 8). Sep 1: Gain insigh

Proposiion developmen sars wih a ullundersanding o your own produc, owha arge cusomers value and wha

compeiors oer. Only hen is i possible o develop clearlydiereniaed, cusomer-oriened proposiions. A his sage you arerying o build an undersanding o he arge marke, compeiors andhe poenial oers ha you could bring o marke. Targe marke: Who are he arge cusomers? Wha will hey

4 Product Management Journal Volume 2

FEATURE

Valuing needsHow to develop the best propositions

Case Sudy Avoiding misakes wih proposiions “A ew years ago I worked or a large soware companyas VP o Produc Managemen,” says Malcolm Lewis,currenly working as a Senior Produc SraegyConsulan a Vodaone. “We had jus released a majornew version o our agship billing produc, and I wascondenly alking hrough he proposiion wih a

cusomer. They asked i he produc suppored direcdebi, which is a undamenal requiremen in Europe. Iimmediaely said yes, bu promised o double check.”

“When I spoke o my developmen eam in India, wherehe produc was creaed, I discovered i didn’ acuallysuppor direc debi. I learn ha cusomers in Indiacommonly pay by cash and direc debi was hen almosnon-exisen. Alhough his is an exreme example, ireminded me o he danger o guessing he proposiionbased on your own se o reerence poins raher hangeting ou and asking he arge marke.”

Malcolm Lewis Senior Produc Sraegy Consulan, Vodaone



PROPOSITIONS


value? Wha problems are hey having ha you migh be ableo help resolve?

Compeiion: Which segmens are being argeed? Whaposiioning has he compeiion adoped? Wha do hey promoe asheir diereniaors? Wha are heir real capabiliies? Are herealernae soluions, as well as direc compeiors? Poenial oers: Wha are he Feaures, Advanages and Benes oyour produc? Wha else could be included in a cusomer oer? Whaparnerships do you have, or could have, ha migh enhance he oer?

When you have limied ime andinormaion i can be difcul o gainsufcien insighs o develop worhwhileproposiions. However he realiy in moscases is ha you’re no saring rom ablank shee, bu basing your research onnumerous pas cusomer meeings, years

o marke experience and eedback romhe sales eam.

A he end o his sage you should havedeveloped several dra proposiions hacould be oered o he same or dierenarge markes. Bear in mind ha he samebase produc can underpin manyproposiions. ▶

Fig.1 Threeseps ocreaingand usingproposiions

Feaures, Advanages and Benes (FAB)A eaure is a characerisic o your produc orservice. An advanage is wha he eaure does andhe bene is he value i brings o he cusomer.Cusomers value hese benes in dierenways. The chances are ha less han hal omos eaures will be really imporan o any one

cusomer.In he case o a pencil, i may no mater o you hai is lead-lled (eaure), doesn’ leak (advanage)and doesn’ sain your clohes (bene) becauseyou never carry one in your sui! In a school,however, ha hey are hexagonal (eaure), don’roll (advanage) and don’ consanly end up on heoor (bene) is a signican issue or eachers!

Sep 2Opimise

Evaluae posiioning opoenial

proposiions looking ordiereniaors

Evaluae proposiions

Sep 3Communicae

Clearly ariculae yourproposiion ocusingon wha cusomers

value suppored by yourdiereniaors

Documen proposiion

Sep 1Gain insigh

Gaher and reviewbase maerial on arge

markes,poenial oersand compeiors

Assess siuaion




FEATURE

Sep 2: OpimiseThis nex sage, oen missed, compares he dra proposiions againsour undersanding o wha he compeiion oers. Each o he draproposiions has a se o eaures inended o appeal o a pariculararge marke – i migh be specic uncionaliy, a paricular aspec operormance or a price opion.

Wha we do a his sage is o sar building he diereniaion soryby aking eaures and mapping ourselves and our compeiors onposiioning maps. In he case o MP3 players in he lae 1990s,manuacurers were ocusing heir eors on compaabiliy, batery lieand size. A produc manager in ha eld migh also have considered

price, memory size, ease o use, sound recording eaures, displayqualiy and so on. He or she willhave been looking or eauresha gave ‘clear waer ‘diereniaion compared oheir compeiors.

In he case o MP3 players(Fig.2), produc B has he besbatery lie and wides range osuppor or music ormas –supporing key markemessages abou heircusomers’ abiliy o playanyhing, anywhere, or longer.The size o he circlerepresens he size o hedevice: he bigger he circle he

smaller he device. Produc C suppors a dieren proposiion based onis smaller size wih no paricular srengh in eiher batery lie or abiliyo play dieren music ormas.

The eaures ha give us diereniaion are now going o beevaluaed hrough cusomers’ eyes. We may be diereniaed rom ourcompeiors bu will our arge cusomers care abou he eaures hadisinguish us or will hey say “So wha?”

I is salien o reveal a his poin ha MP3 player C was in ac he

Poor Excellen

O n e

Batery lie

M u s i c f o r m

a t s s u p p o r t e d

L o t s

C

A

B

Fig.2 How dierenMP3 playerscompared by baterylie, music ormassuppored andphysical size



PROPOSITIONS


Apple iPod. Apple’sundersanding o whahe cusomers valuedmean a compleelydieren proposiionmap. They recognisedbeter han mos whareally matered.Cusomers didn’ reallyvalue small size, i washe hinness o he

device ha made ieasier o carry. Theydidn’ wan los oeaures and butons,bu he ease o he clickwheel. Suppor ormuliple ormas jus creaes headaches or mos cusomers, hesimpliciy o quickly copying all your music ono your device rom a PCmakes i atracive. Apple saw hese eaures as he batleground onwhich hey would compee (Fig.3). Circle size in his case represensease o geting your music on he device (iTunes).

Wih regard o he oher atribues, Apple provided a relaively pooroering compared o many o heir compeiors: a poorer display,shorer batery lie and incompaibiliy wih many o he music ormasha were prevalen. These rade-os could only be aken because heyhad an undersanding o cusomer needs and a ocus on meeing hoseha matered.

Whils we can’ all perorm like Apple, we should always be awareha mos cusomers couldn’ care less abou our produc or service.They wan o know wha i can do or hem; how i will solve someproblem or help hem achieve some career or business objecive.

Carrying ou his analysis ino he imporance ha arge cusomersplace on he dieren benes o he whole produc oering is cerainlyno easy. I requires an in-deph undersanding o wha drives andmoivaes cusomers and wha hey value. ▶

Fig.3 The iPodhas come odominae he MP3marke becauseApple realisedha hinness

and ease o usewere he criicalacors. Circle sizerepresens easeo geting yourmusic ono hedevice

Unclear, Muli-click Inuiive

C h u n k y

Ease o use

T h i n n e s s

V e r y t h i n

iPod

A

B




FEATURE

No all eaures have he same value o all prospecive cusomers sohis may be he poin a which i becomes apparen ha you need osegmen and arge specic groups o cusomers wih dierenvalue proposiions.

Sep 3 CommunicaeThe nal sep is o creae a documen or presenaion ha describeshow he proposiion mees he needs o a specic se o argecusomers.

How do you represen value in a proposiion? One approach is oconsruc a model ha quanies he value o a cusomer o eaures

Example Proposiion Crib Shee or Sales

FeaureEmail sysemhosed andrun by us orhe cusomer

Highly reliableservice wihService LevelAgreemens(SLAs)

Accessedusingsandardemailapplicaions

Regular

monhly ees

High pricelevel

Advanage o he cusomerNo complicaed soware oinsall, se up and run

No backup processes oorganise and no reliabiliyissues o worry abou

Users can keep heir exisingemail applicaion and do noneed o insall new soware

Makes i easy or cusomers

o budge

None: our price levels areypically higher han hecompeiion

Bene o he cusomerMakes lie very easy or hecusomer as hey don’ needo nd and pay or echnicalresource o help hem se up andrun he service

Gives cusomers who rely onheir email peace o mind

Makes lie easy as here isnohing new o learn

Pricing srucure reduces

cashow risk or he cusomer

None

Table 1The ExampleProposiionCrib SheeThis proposiioncrib shee (righ)has been creaedor a myhical emailsoluion providedas a hosed servicerun by ‘us’ or hecusomer. Targecusomers aresmall proessionalbusinesses o 2-5employees.

Compeior Xprovides an emailsoluion ha isinsalled a he

cusomer’s sieand is run by hecusomer.

Compeior Yprovides a similarhosed emailsoluion o ‘our’ own




PROPOSITIONS

based on £££s. Ideally your model will show how your unique eauressave or make money or he cusomer compared o he compeiion. Ocourse, i’s oen very difcul o develop a believable scenario becauseo all he assumpions you have o make so i’s imporan o es yourassumpions wih cusomers o ensure you build a credible model.

Anoher approach is o compare and presen produc eauresagains he nex bes alernaive. In mos markes producs are pretysimilar, so his is a way o easing ou key dierences. The rick is o linkhe eaure dierences o he one or wo key benes ha you believeare mos imporan o he cusomer, and suppor hese wih as manyproo poins as possible. The Example Proposiion Crib Shee (below) is

Quesions o askAtack: “Do you rely on your email and would youlike someone else o do all he worrying abourunning your soluion? Would you like a companywho specialises in running business-criical emailsoluions o run yours?”

Atack: “Wha would you do i your email sysemwen down? We’ve had a number o cusomerscome over o us because o reliabiliy issues wihCompeior Y’s service. We are he only companyha provides service perormance guaranees.”

Atack: “All oday’s email soluions use sandardemail applicaions, bu how imporan is i hayour email soluion is reliable?”

Atack: “Alhough we provide regular monhly

charges so you can easily manage your coss, wend ha mos cusomers value he reliabiliy andsimpliciy our service oers.”

Deence: “Whils i’s rue Compeior X oersslighly beter pricing han us, we nd ha moscusomers are more ineresed in a soluion heycan run wihou echnical experise. Whils i’srue ha Compeior Y oers slighly beterprices han us, we’ve had a number o cusomerscome over o us because o reliabiliy issues wihheir service.”

Value o he cusomerBased on our cusomer researchhis is by ar he mos imporanissue or cusomers in his argesegmen

Based on he Acme ResearchRepor 2007, over 75% osmall businesses say haemail is he criical IT sysemin heir business

Cusomers expec his, so i isa ‘hygiene acor’ raher hanadded value

Our cusomer research has

shown ha less han 10% ocusomers care abou his

Our cusomer research showsha he majoriy o cusomersare no paricularly price-sensiive

Compared oCompeior X & YBeter han X andsame as Y

No sure wih X andbeter han Y

Same as X, sameas Y

Beter han X,

same as Y, bu noimporan

Worse han X andworse han Y




based on a myhical hosed email service. This crib shee is a powerulool o give o your sales channel.

ConclusionDeveloping proposiions is no rocke science, bu i akes dedicaedime and resource o do well. However, we believe i’s worh heinvesmen. Having a well developed proposiion pus you in he drivingsea wihin your business by providing a vision o wha needs o be

developed, wha’s imporan and wha’s no.I also clearly ariculaes why cusomers should buy rom you and

no rom he compeiion, signicanly reducing he chances o yourproduc ailing in he markeplace.

PROPOSITIONS

Wise Words “Change is he lawo lie. And hosewho look only ohe pas or presenare cerain o misshe uure.” John F Kennedy

Fig.4 Improving your proposiion. A each poin in hecusomer liecycle you have an opporuniy o provide valueo your cusomers hrough he ouch poins hey havewih your organisaion. A good exercise is o go hrough

he cusomer liecycle o undersand all he cusomerouch poins you have and o ideniy poenialaciviies ha could add o your proposiion. Youshould hen check which will be he mos valuedby cusomers and hereore provide he biggesimprovemen o your overall proposiion (asksome cusomers). For example:

• Evaluaion Sage. Provide rials o allowcusomers o evaluae your produc and herebyreduce he risk o hem o choosing he wrongsoluion. This may give you a signican increase insales.

• Seup and Use Sage. Provide pro-acive suppor ahese sages o make sure cusomers ge he bes romyour produc. This validaes he decision o buy andminimises reurns.

• Sop/Replace Sage. Have a programme or cusomers who may be hinking ochurning, o make i easy or hem o upgrade o anoher o your producs. This may alsowin you business ha would oherwise be los.

Discovery Buy

Seup

Use

Evaluaion

Cusomer Liecycleor Producs

Sop/Replace



BEST PRACTICE


How do you ge ino he mind o a cusomer and undersand wha heyreally value? Easy, you go and ask hem. Ahh, bu i’s no ha easy I hear

you say: do hey rus you, will hey alk o you, will hey give you asraigh answer?

All you wan o do is undersand wha cusomers value in yourproposiion and i hey are ypical o a signican marke segmen.

When you gaher and analysecusomer daa you need a modelagains which o es proposiions; youneed somehing ha brings he wholehing o lie. This is especially rue iyou’re working wih ohers and ryingo evolve a common vision. Wha youneed are personas.

Personas are made-up characerscreaed o represen a group ocusomers or users, and were rspopularised in he book The Inmates

are Running the Asylum by AlanCooper, published in 1999. They have akey role o play in user-cenred design

where he goals, needs and limiaionso he user are considered as par ohe produc design.

Personas pu a human ace on heoherwise absrac daa we collecabou cusomers. They give us greaerabiliy o ‘guesimae’ how a cusomersegmen will reac o dieren

PersonasWhy proling customers is so valuable

Case Sudy Poliical persona proflesThe UK poliical paries use personas as a way o creainga common shared vision or heir pary o he key peopleo arge in he run-up o he nex elecion. These are he ‘swing voers’ who will probably decide he resul. Someexamples below.

Mondeo Man The erm wascreaed when Tony Blair spoteda man polishing his Ford Mondeoand decided he was he kind o30-somehing middle incomehomeowner whom Labourneeded o win over rom heConservaives in 1997.

Pebble Dash People Voersidenied by he Conservaives in2001 as he group hey had o win.They were married couples aged

35-50, whie-collar workers andproessionals, who lived in semi-deached, oen pebble-dashedhomes in he suburbs.

Bacardi Breezer Generaion In 2004 Sephen Byers urgedLabour o ge in ouch wih 18-25year-olds who were in dangero being los o he democraicprocess.




PERSONAS

proposiions by puting you, he produc manager, in he shoes o yourcusomers. See he Table 2 (righ) or an example o personas or amobile phone company.

Sereoypes vs archeypes vs personasA sereoype is a caricaure which emphasises key eaures or comiceec; eg. all Scosmen wear kils. In conras an archeype emphasisesypical, relevan and dening eaures; exacly wha we need o know

abou a cusomer segmen. Personas bring archeypes olie by giving us someone we can ideniy wih, someoneha represens he archeype.

Ideally, personas are developed rom daa colleced ininerviews wih real cusomers. The oupu is a shordescripion covering key cusomer daa, rom goals andatiudes o values, needs and skills. Add environmenaland behaviour paterns, and mix in some ineresingcional deails o bring he persona o lie. Using personas every dayOne organisaion we’ve worked wih creaes an area wiha noiceboard o picures and areacs or each persona.There migh be ickes or evens hey’d go o, or picureso where hey migh live and heir amily and riends – heyeven ask sa o bring in hings ha he person would beassociaed wih, like a cool T-shir or Lauren or a gol ballor Ben (See Table 2, opposie).

I’s all par o building a rich picure o he persona haallows you o ge inside heir mind and undersand wha

hey would do and wha hey would value.Building up a picure o poenial cusomers can be

difcul and you need o use any sources o inormaionyou can nd. However i doesn’ have o be expensive marke research.Any conac you have wih cusomers is a chance o build up a richerpicure and ideniy common paterns.

Once you’ve compleed your personas you have an excellen ool ohelp develop and evaluae proposiions.

Case Sudy Online personasBuyer personas can be used as a

powerul way o communicaingproposiions o cusomers. ProducEducaion, an online markeing andeducaion agency wih a heriage inproduc raining, develops e-learningha promoes proposiions on acusomer’s websie.

Produc Educaion (www.produc-educaion.com) exploi he laesweb-based ools, combined wih heirown proven learning heory, o explainproposiions clearly using a mixure

o video, audio, images and ex. Theirapproach is o develop mini-sorieswih characers based on buyerpersonas ha use he produc.

“Facs are smooh, sories are sicky,” says MD Ryan Jennings. “Developingsories o personalise proposiions oa argeed audience makes producmessages resonae more sronglyand we’re seeing growing demandrom companies moving away romac shees and PDFs.”

Ryan Jennings, Produc Educaion



BEST PRACTICE


Table 2 Example Personas or a Mobile Phone Company

Name , Age

Home

Work lie

Social lie

Goals

Currenmobile

Fuurephones

Lauren, 16

Lauren lives wih herparens in a semi-deached house in hesuburbs. She has a broherand a ca (she likes heca), and escapes o herbedroom or peace.

Lauren is sill a school.She quie enjoys i and hasa big circle o girlriends.

Lauren’s social lie isvery busy. She’s alwayspopping ino own wih herriends o go shopping oro see a lm. And here’s

usually some new opic ogossip abou.

Lauren believes haalways being in ouch wihher riends is imporan.She wans o look cool andshe wans o be cenre oatenion.

Lauren currenly hasa pink phone. You canchange he cover and i’s

go a camera. Her dadpays he bill and so arshe’s go away wih acouple o whoppers.

A uure phone has goo be cool. I’s go o behe laes hing, and leher do as much exing aspossible on he limiedbudge her parens willimpose.

Ben, 43

Ben lives in a converederrace house in a rahernice par o he ciy. Hiswie works oo and heydon’ have any kids. Theirhome is ull o expensivedesigner urniure.

Ben is he FinancialDirecor o a small designcompany.

Ben preers a nicemeal wih his wie in aresauran o a nigh ouwih he boys. He rarelygoes o duy and always

wans o be in ouch wihwha’s going on a work.

Ben aims o reire a50, or a lie o gol andcruises. So now he needso make his orune wihhe design company. He’salways working.

Ben has a mobile hebough hree years ago.I’s a rused riend bu i’s

now saring o look a litlehreadbare.

Ben would like o keepin ouch wih his emails,so he needs a phone hacan handle ha. I alsohas o look good or he ‘creaives’ in he ofce willlaugh a him.

Mike, 70

Mike lives in a bungalowon he ouskirs o avillage. His wie died a ewyears ago bu he now hasa 65-year-old girlriend heme a a local ea dance.

Mike is reired bu helpsou a he local gardencenre rom ime o ime.

Mike’s social lie revolvesaround he local pub. Hedrives ino he counrywih his girlriend and olocal ea dances.

Make wans o be ableo say in ouch wih hisgirlriend (oherwise heyoung hing migh run o),and ge in ouch wih hisamily in emergencies.

He doesn’ have a phonebecause he can’ ge onwih hem. Bu naggingrom his girlriend and

amily has persuaded himo buy one.

I needs o have big keysas his dexeriy, sigh andhearing aren’ wha heyused o be.



In mass markes a key skill or produc managemen and delivery eamsis o sandardise, keeping he producs and service as consisen as

possible across he cusomer base o maximise economies o scale. Such companies embrace a ully ‘producised’ approach o minimise he

cos per sale and drive proabiliy hrough sales volume.In he case o ‘big icke’ iems, hough, sandardisaion is oen no

possible. These are ypically high-priced soware producs sold in aB2B markeplace. Regardless o he scale, a common aspec o big

icke proposiions (and a keydierence o mass marke oers), isha he proposiion mus oerexibiliy o mee complex cusomerrequiremens. The ulimae soluionis a projec o develop a bespoke,cusom-buil soluion. Howevermos ‘big icke’ producs allsomewhere on he projec/producconinuum (See Fig.5) wih a core

produc and addiional cusom developmen o give he cusomer heexibiliy hey wan.

Mike Beech is VP or Produc Managemen and Markeing a

Acision, he leaders in messaging producs, which was unil recenlypar o Logica. He considers proposiions essenial o any size oproduc or service. “They are absoluely criical,” he says, “we sellproposiions, we don’ sell producs. Whenever we ry o sell producswe ail. Cusomers wan soluions o problems, which is he wholeproposiion no jus he produc eaures.”

“And, when i comes o big icke sales here is a proposiion percusomer, which makes i ever harder because he proposiion has o be


BIG TICKET DEALS

Thinking bigLarge product propositions

Cusom buil

Projec approach

No IPR ownership

Produc approachOf he shel

Build once, sell many imes

Full IPR ownership

Fig.5 Projec/ProducConinuum. Mos bigicke producs allsomewhere on hisline




subly dieren in each case. We ry osrike a balance by creaing proposiionsper marke segmen, mapping ouelemens and giving he salesorce keymaerials o creae a proposiion on he y.”

The rs big saleImagine he scenario. A company is piching or is rs high value sale.Such a sale is oen won on he back o asrong produc-based proposiion bu oclose he deal, he company has o deliver

urher eaures, wih some cusomdevelopmen.

Sales people, under pressure andrewarded on revenue and cusomersaisacion, love his approach. The ‘cos osale’ may have been high bu heir cusomerhas been well suppored and all heir valuedrequiremens have been me.

The company aspires o deliver hescalabiliy o a produc business bu heseducion o a big sale disracs hem inopiching cusom soluions like his ime and ime again. Consequenlyyou ge a sales-driven organisaion repeaedly responding ocusomers, and a produc ha is increasingly pulled in conicingdirecions. Cusomisaion becomes an increasing elemen o he saleand he business coss o develop, suppor and keep rack o hevarians spiral ou o conrol.

“Cusomisaion is one o our bigges problem areas as a business,” says Mike Beech o Acision. “The goal o he produc manager is or heproposiion o be producised bu easily cusomised. The cusomerwans a bespoke soluion or hemselves bu a produc prices.”

“Cusomisaion is also a challenge when i comes o presening ourproposiions. We ry o ge hem all ono one slide, wih one op-levelbene or he produc, and hen hree or our urher eaures andbenes.” The challenge, he says, is ha i we disill he proposiion oo

Case Sudy Mainaining credibiliy “I’s very imporan o gain cusomer eedback onyour proposiion rom a wide range o users,” says

Annete Simpson, currenly working as a SeniorConsulan a Nokia.

“I’s paricularly imporan or producs wihmuliple ypes o users who may have dierendemands on he produc and place dierenimporance on he produc eaures. In myexperience, undersanding cusomer needs isvial. I you’re communicaing o your cusomerssomehing ha’s jus no relevan, you lose bohcredibiliy and any uure business.”

Annete Simpson, Senior Consulan, Nokia

All abou righsA key aspec o bigicke proposiionsis he batleor ownershipo Inellecual

Propery Righs(IPR). I is vial ora produc-basedcompany o hangon o he IPR owha is buil so hai can be re-usedand oered as paro he produc ouure cusomers.

$ 6 4 0 0 0



ar i becomes generic, bu i i is oo cusomer-ocused he proposiionmay work perecly or one clien bu no or anoher.

Managing projecsWhen big icke iems move owards a projec delivery model, whabecomes o he produc manager? A he core o such oerings shouldbe sandard produc archiecure, eaures and capabiliies. Beyondhese are modules o uncionaliy rom which dieren proposiionscan be creaed, and urher on cusomer-specic elemens o

proessional service conguraion andcusom developmen.

The produc manager has a clear rolea he core o his proposiion. He or she ishe voice o he cusomer, ensuring hecore capabiliies mee he key valued needso cusomers and arge prospecs.Similarly, he produc manager helps direche se o eaures and eaure packageso be oered as opional add-ons o hecore produc.

There can be a bewildering number ocomplex and conicing requiremens rom ‘sraegically imporan’ cusomers vyingor he atenion o he produc manager.Where cusomisaion and conguraion are

used o mee he needs o imporan cliens, we may well ask where herole o he produc manager ends and ha o he proessional servicesand developmen begin?

In ac, he produc manager has a key role o play. Their role, asalways, is o direc and drive a produc owards proably, deliveringcapabiliies valued by he arge segmen. Given his simple aim,produc managers can provide valuable insighs.

• They must look for commonality between the customer

requiremens ha are driving conguraion and cusomised sowareeor so ha sandardised, o-he-shel eaures can be deliveredmore cos eecively o uure cusomers.


Fig.6 Proposiionsrucure or ‘bigicke’ producs

BIG TICKET DEALS

C o n f g u r a t i o n a n d pro f e s s i o n a l s e r v

i c e s

C u s t o m so f w a r e

O p

t i o n a l f e a

t u r e s / f ea t u r e g r

o u p i n g s

Coreproduc

eaures &archiecure




• They must make decisions on

produc areas where conguraion andcusomisaion should be avoided so soha produc direcion doesn’ ‘dri’ away rom planned sraegy.

Managing he proposiionAll produc managers, regardless o he per-sale value o heir producmus manage he ongoing roadmap. However Mike Beech a Acisionbelieves ha he more complex heproposiion he greaer is he need

or produc managers o geinvolved. “Amongs oher hings,he soware may ake ime odevelop. We developed aproposiion or a complex raingplan once, bu a year down he linehe condiions had changed,cusomers didn’ wan 100s oplans and we needed o develop anew ype o archiecure.” I is heproduc manager’s role o ensurehe proposiion is sill relevan, andis ne-uned as he circumsanceso he marke and cusomerschange.

Conclusion

Produc managers mus ake helead in undersanding which capabiliies are mos highly valued in heirarge segmens. These can hen become par o he basic proposiiono boos proabiliy, speed o marke and cusomer saisacion. The ‘high value’ produc manager will ge a lead on heir compeiors i heymake he righ choices abou wha should ge producised and whashould be le or cusomisaion.

Case Sudy Managing big icke proposiions

According o Mike Beech, VP o Produc Managemen aAcision, he developmen o a proposiion can conusesome people in he sales channel. “We once made a big pusho alk abou proposiions. One day he sales eam wereselling boxes and he nex a ‘soluion cloud’ ha hey didn’undersand. I ook us 18 monhs o esablish he idea.”

The value o a proposiion, Mike Beech explains, is ha ihelps businesses undersand he value o heir producs. “Every company knows wha heir producs do, bu somearen’ sure why, and don’ undersand heir value. I’s aquesion o inerpreing needs and values, wha my rs

menor called Imaginative Understanding .” “For big icke iems ha can be a challenge i you are dealingwih a number o people wihin one cusomer organisaionwih dieren needs and wans. You have o know hesrucure: who are he blockers, who are he supporers, whois he budge holder and wha hey all wan.”

Mike Beech, VP Produc Managemen, Acision

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One o he bigges challenges when developing good cusomerproposiions is geting real and high qualiy cusomer insighs o help

you develop he proposiion. I’s doubly difcul i you are rying o

persuade your company o spend good money on nding hisinormaion hrough marke research and hey jus aren’ ineresed. I’seasy o si back in he ofce, in our comor zone, and assume (shu oureyes and hope) ha we know all abou our cusomers.

Le’s make a disincion beween cusomer inormaion andcusomer insighs. You may be able nd los o acs and gures aboupoenial cusomers and segmens on he web bu wha’s essenial arehe insighs ino wha drives cusomers, wha heir problems are and

wha benes hey are looking or rom your produc.This qualiaive raher han quaniaive daa is key odeveloping proposiions.

Gahering marke inormaionThere are a number o dieren ways o gaheringmarke inormaion (See Fig.7, opposie). A key concepis he idea o lisening poss; places and opporuniies oake soundings rom cusomers and he marke. Many o

hese exis already and no all o hem cos money orake up los o your ime. However insighs are usuallyneeded by a deadline and geting he lisening poss inplace and building he relaionships is somehing besdone in advance.

The direc sales orce, ou meeing cusomers day-in day-ou, are anexcellen source o inormaion. The problem can be ha sales peopleknow wha one cusomer wans o buy (usually he las one hey visied).


BEST PRACTICE

Lisen & LearnEective eedback drives the best propositions

Case Sudy Produc blogsMark Maciw o Clearswi says ha areally valuable source o inormaionis online ‘sel-help’ cusomer orums orblogs abou your producs. “Clearswicover he minimal coss o hosing andhen le cusomers have heir say.”

“Cusomers can reely exchangecommens and discuss issues heyare having. Alhough we conribueanswers rom ime o ime, mos ohe discussion is direcly beween

cusomers. However, he biggesbene o us are he insighs we gainino how our cusomers are hinking.”

Mark Maciw, Clearswif



MARKET RESEARCH


Produc managers musdeermine i harepresens a singlecusomer or a marke ull ocusomers.

Searching he web andregularly scanning he radepress is a good source oinormaion bu rarely giveshe exac insighs you’reaer. The pars o your

organisaion ha supporyour exising cusomers(he phone suppor desk oreld suppor) are excellensources o eedback. Theyusually have a good insigh across your cusomer base ino whacusomer’s care abou, and o course, wha’s going wrong wih yourcurren produc. They oen have good relaionships wih he users oyour produc bu bear in mind ha i is he needs, wans and moivaionso he person ha is buying ha really coun.

I’s worh alking o suppliers – hey should be rying o work ouwha he bes proposiion is o you and should hereore have someinsighs ino wha your cusomers wan. They are also alking o yourcompeiors so you may pick up useul pieces o inormaion.

Searching or leadersThe bes qualiy inormaion comes direcly rom he horse’s mouh.

Visiing cusomers akes ime and you have o se expecaionscorrecly so ha i’s no jus seen as an opporuniy or hem o lobbyor he eaures hey wan or an opporuniy or you o sell. A reallyvaluable lisening pos is eedback rom visionary cusomers –cusomers who are hough leaders in heir area.

As a produc manager you should be aiming o do a regular rawl olisening poss and esablish relaionships ha you can call upon whenyou need hem or proposiion work.

CommensI you have anycommens orquesions emailhem o [email protected]

Fig.7 How o gahercusomer eedbackbased on originalresearch by BobMarin (www.irconsuling.com)

Low High

L o w

Time o gaher ino

C o s t t o g a t h e r i n f o

H i g h

Sales

Press/web

Field suppor

Suppor desk(phone)

Suppliers

Trade shows

Cusomer visis

User Groups/conerences

Visionarycusomers

Commissioned

markeresearch

Publishedanalys

daa

Gu eel



This recenly published book is a ascinaing read or producmanagers. The auhor is a behavioral economis, sudying he way people

make decisions when hey buy, sell, and make real-lie choices. Hisconclusion is ha he decisions ha you, I and cusomers make mayoen seem irraional bu hey are predicable. Insead o assessing all

he opions and making a sraigh-orward logical decision all sors ooher acors are a play such as emoions, comparison agains wha wealready know and social norms - and hese all aec our choices.

In his research he runs all sors o ineresing experimens – mainlyon his sudens a MIT. Looking a pricing, he zapped voluneers wihpainul elecric shocks and hen oered hem painkillers cosing eiher$2.50 or 10 cens prior o a second round. All he pills were idenical andake, bu he $2.50 pills proved o be wice as eecive as he 10 cenpills in dulling pain. Pay more, and no only do you hink you ge a beterdeal bu your brain convinces you ha you have!

Anoher example is he powerul eec he word ‘ree’ has on us.Ariely quoes an example rom Amazon where hey oered reeshipping i you ordered wo books raher han one. This creaed a hugeincrease in sales even hough some o he purchasers probably didn’really wan a second book. However in France, where insead o reeshipping i was reduced o a bargain price o only one Franc (abou 10p),here was no dierence in sales. Once his was spoted and he oer

was changed o ree shipping, France joined everywhere else wih adramaic sales increase. The auhor conends ha his is jus one moreexample o irraional bu predicable behavior.

Wih ineresing chapers like why dealing wih cash makes usmore hones, i’s a grea read as well as providing pearls o wisdom ohelp you develop your proposiions and pricing sraegy.


The JournalReviews and eedback or product managers

PredicablyIrraional, Thehidden orces hashape our decisionsBy Dan Ariely

Wise Words “The dread ocriicism is he

deah o genius.” William G Simms

Book Review



SURVEY


Have your viewEvery year Produc Focus runs an indusry survey o gauge he sae o produc managemen in he UK

Telecoms & IT indusries. This gives us real insighino indusry norms, rends and bes pracice.

Working in produc managemen can be exciingand exhilaraing, aking businesses orward andhelping develop and implemen sraegy. Bu, as aproession i lacks deniion and his can lead orecruimen issues, rusraion in he role andproblems in upskilling hrough relevan raining. Every

company views produc managemen dierenly and he skills andcompeencies o excel in he role change rom company o company.

Wihin his variable landscape, he resuls o our annual producmanagemen survey provide a poin o reerence. The survey quesionshundreds o proessionals on heir skills and experience in producmanagemen enabling us o build a picure o curren pracice andperceived skills gaps. Each paricipan receives personalised eedbackon how hey compare o heir peers. Heads o produc managemen canask or an aggregaed view o how heir eams compare o he res ohe Telecoms and IT indusry. To see how you compare, email us [email protected] and we’ll ake i rom here.

Annual SurveyWe use our surveyo benchmark ourcliens’ producmanagemen. Toake par in henex survey or odiscuss he resulsplease conacProduc Focus.



As a produc manager you can’ do everyhing you’d like. Jus likerevising or an exam, here is always more you could do and he

nagging eeling ha perhaps you’ve been working on he wronghings. One o he challenges in mos companies is ha you end o gesucked ino only working wihin he business – i’s always easier o say

in he ofce and alk o people you know. The danger o spending allyour ime alking o colleagues abou cusomers raher han using ohersources is ha your views become disproporionaely shaped byinernal conversaions, and urban myhs spring up.

The ruh is ha mos o us don’ have he ime nor he money o doall he cusomer research we would like and we have o guess a someo he answers. Using your gu eel is OK bu remember bona decusomer research always rumps opinion when i comes o convincingyour managemen.

One prioriy no o orge, and a key par o he produc managemenrole, is sraegic produc managemen. In essence, his is undersandingcusomer needs, ideniying soluions ha your company can deliverand clearly ariculaing he soluions or developmen, markeing andsales. This is wha he ask o developing proposiions is all abou.

Produc managemen is se up in dieren ways in everyorganisaion bu we hink his essenial par o he role is oen udged,spli beween markeing and sales or missed alogeher. Done well i’s a

very powerul posiion – and one we hink produc managers shouldacively embrace.

So … i you’re no developing produc proposiions or yourbusiness, who is?


The InsighThe power o a proposition

Wise Words “The uurebelongs o hosewho believe in hebeauy o heirdreams.” Eleanor Roosevel



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