Product Management

Why you don’t let sales do Win/Loss analysis

Win lose dice

The Dude has been around awhile, and in his long time on this planet, he has learned a few things that are hard core truths.  Don’t bet against Apple (since the second coming of Jobs), don’t give in to Engineering on what the customer truly wants, and never EVER let Sales do Win Loss analyses.

While I am sipping a fine Caucasian this Wednesday morning, sitting on the couch wearing my ratty old, yet comfortable dressing robe, I am reminiscing about a few times where in the past, I was not allowed to conduct the Win/Loss analysis.  There are tons of great resources to help you do effective analyses, and I know some third party groups that will get fantastic results, that only come from working with an outside, disinterested party. No, this is the pitfalls of letting Sales run wild with it.

First, win/loss analyses are great ways to objectively understand what the dynamics were during the development of a lead, through the ultimate decision to buy or not, and from who.  Unbeknownst to the garden variety sales person, customers are usually quite loquatious when asked, even if it is from someone working at one of the party companies.

In an organization, if an internal resource is to be used to handle the Win/Loss analysis, the best team member is the one who is most closely associated with a Product Marketing role.  They usually have the communications skills (the how to ask penetrating, yet not off-putting) and experience in working with customers from their Voice of the Customer work.  The worst team to tackle it is Sales.

Yet, Sales is often the team that grabs the reins and tries to own it.  This is like putting the fox in charge of the hen-house.  Sales is uniquely unqualified to handle the process:

  • First they have a long and intimate relationship with the customer.  This makes it impossible for them to be unbiased and impartial.  They literally discount bad news even when told to them directly.
  • Second, they have a vested interest in the outcome.  They want to look good, so you will see that wins are often distilled to superior sales skills, or how awesome their efforts were.  Losses are always due to factors outside their control, like “Product didn’t meet needs”, or “Product missing feature X that Competition had” (note, they never dig in to see if that feature was important to the customer), or the number one item “Price” – often with no other information around it.

When you get into a more formal process however, the truth comes out.  My company recently hired a third party firm to do a report on a major loss (a multi million dollar deal with a very large financial institution), and the findings were revealing.  On technology we were ahead of the competitors, and more importantly, we were better aligned with their needs and requirements.  Our pricing was middle of the pack, and most importantly, the customer thought that our technology offerings, and our commitment to the product and market made our value very high against the competitors.  But they chose the competitor anyway, because their sales manager was arrogant, unresponsive, and perceived as being deceitful.

Granted that this is one case, but it is hardly unique.  It also highlights the value of doing a structured win loss analysis, and going that extra step to understand the market dynamic.  Customers are amazing people, they will tell you some amazing things, as anyone who has done a formal VoC exercise will attest to.  Don’t let your biases and jealousies interfere with getting at the truth.

Time to grab another cup o’ Jo, and continue my morning slacking.  League games tonight, need to mentally prepare to roll.

Product Management

You can’t do Product Management w/o Some Marketing

big-lebowski-web 

I am in between league games, and I thought that I would do a little posting.  If you follow the #prodmgmt hashtag on twitter, no doubt you have seen an (at time) lively debate about the differences in the two titles, “Product Manager” and “Product Marketing Manager”.  The two sides square off and really sling some mud (figuratively, of course) about how different, and distinct the two roles are.

Baloney. 

The only certainty is that even in a small organization, by any definition that you care to prescribe to, a product manager has more work to do that any one person can conceivably perform.  The fact that as an organization grows, and, more importantly, the product revenue grows, there comes a time when some division of labor is needed, and an added headcount is essential.

Some will argue that at this point, you create segmented roles.  Product Managers become more closely aligned with the Blackblot “Product Planner” role.  Head down, turning requirements into a product.  Product Marketers take this product, and put in place collateral, sales enablement material, segmented strategy, marketing and promotion plans, and track revenue and sales.

This. Does. Not. Work.  I know someone is going to jump in and swear that their group has implemented just such a division.  I am convinced that they are fooling themselves, or are truly not partitioning the role such.

The Product Manager

If you ascribe to the Blackblot view, that the product manager is the product planner, there are problems.  You are tasked with creating a set of product requirements (or a backlog if you are agile), defining the priorities, and using the user personas that have been built to create rocks, macro, and micro stories.  You are also likely the product owner (another overloaded operator, and a topic for another posting), working with the development team.

It is assumed that you have little or no direct interaction with customers, and not much more with the sales team.  you are like that relative that you would prefer that you didn’t have, darkening part of your family tree.  Your life is spent inside the business unit, dealing with development, operations, and senior management.  If you are in a regulated industry (think: Medical Devices) you do endless paperwork and regulatory filings.

The problem with this black box view of the product manager role is that it is impossible to truly do your job like this.  How do you set priorities without direct knowledge of the market?  How do you grok the true nature of the persona if you weren’t part of creating the persona in the first place?  How do you define value if you are part of the evolution, and genesis of the use cases?  If you rely on a “product marketing” person to hand these to you, with little else in the realm of context, you are truly constrained.

I posit that to be a product manager, you have market authority.  You understand the business needs that your products address.  You are familiar with the user personas (either as being party to their creation/maintenance, or having been a customer at one time).  You know how to dive into the CRM tool and extract nuggets of market segmentation, and targeting.  You know how to get into the organization’s Business Intelligence cube (Dynamics, Cognos Powerplay, or similar) and extract reports on revenue, backlog, and regional performance by product, SKU, sales territory, and others.  You know how to calculate a CAGR. 

You also need to be able to augment marketing (the communications side) by drafting data sheets, tech specs, white papers, brochure copy, and more.

You might argue; “Yeah, but …  Isn’t that why you have Product Marketing?”  Yes and no.  Often product marketing people are less technically close to the product.  They are not able to get to the deep level of understanding that makes drafting a data sheet a breeze.  Or, they may not have the deep analytical skills to generate reports, and present data to the executive team.  And that is OK.  As your product grows in revenue, you need more assistance to the sales team.  More and better collateral.  Sales training.  High value deal intervention.  Presence at professional societies.  Working with industry analysts. 

Summary

In the dark past, the product manager was the one man stop for all things product related.  The title was often “Product Marketing Manager”, and reported into the marketing group.  This person had strong technical credentials, communications skills, and a knack for both promotion (marketing) and analysis that bridged the gap.  In this epoch, the Marketing Communications group was an equal partner, sharing responsibility, and collaborating on the outbound marketing goodies.

Today, the Marketing Communications function has been radically altered.  It is more of a service (think “Kinkos”) and has little capability to partner on development and delivery of high impact material.  This has lead to the rise in the responsibilities of Product Management to own almost all of the content creation, promotion definition, and outbound marketing thinking.  Hence the trend to split the roles.

However, because there are two people doing an expanded role doesn’t equate to the ability to have a hard delineation of the job roles.  Both sides need access and experiences to cross the chasm between them.  It is this bridge that makes them synergistic.  Organizations that try to make it a hard segmentation are doing irreparable damage to the roles and reducing effectiveness of both halves.

Time to roll my third set.  Wish me luck.