|
Knowing The Right Time for Strategy Help
by Christine Crandell
Crafting an effective market strategy - no software executive can deny its importance. For software start-ups, the market strategy is so critical it can make or break the company. Some do it on their own quite successfully - but the majority has less than average results. Start-ups are constrained by resources, time and conflicting demands. These constraints can cause their approach to crafting market strategy to be unstructured, based on antidotal evidence and sporadically executed. The resulting strategy becomes based upon 'internally driven' viewpoints of the market. The outcome -- an incomplete and nonfactual understanding of market dynamics, drivers, threats and opportunities. Internal perceptions and sales opportunities then drive subsequent strategy evolution. While these are important variables they do not have a forward looking view of critical market dynamics that often dictate strategy adjustments early in order to leverage sustainable opportunity and success.
Market strategy consultants can bring structure and a process to the team to ensure a solid and factual market understanding is developed. Their contribution can result in leveraging the team's experience, passion and vision with domain expertise at critical times in a company's lifecycle. Software market strategists add value in four specific areas - selecting the best technology market to compete in, defining the customer target markets, crafting the value proposition and developing a market strategy for securing sustainable market share. For the value add to be significant it is imperative the consultants have successful track records and domain expertise in the technology and target markets. They, in essence, bring to the table the knowledge and skill depth a company needs at specific points in its lifecycle. Having an employee with the same skill levels on board is cost prohibitive for startups and even in mid-sized software companies, it is difficult in the face of day-to-day operations for marketing employees to remain objective enough to have that valued 'outside-in' perspective.
Market strategy consultants are typically brought in under the following situations - a company/product launch, a significant funding cycle, strategic operating planning, and market or business expansion. What all of these situations have in common is a critical need for a solid, current, factual market understanding and an assessment of the potential impact of future market dynamics. This means understanding the current dynamic of the technology and customer markets and identifying the trends on the horizon which can bode well or poorly for the company.
Leading market strategy consultants are skilled at interpreting these trends into situations the company may face and determining the potential courses of action available to leverage the trends into opportunities. This typically includes overall market assessment - is the market emerging, consolidating, commoditizing; a future view of the market - where is it going and what are the drivers; a threat assessment - who is gaining market share and how are they bolstering their position; and an opportunity assessment - where is the growth coming from and how can the value chain between the customers' need and the company's solution be strengthened. A core competency alignment is also needed which matches the company's strengths and abilities against what it is going to take to win market share under the anticipated market conditions. Such a foundation is the key to crafting a successful market strategy. Without this foundation the resulting strategy runs the risk of being flawed because it is based on incomplete or inaccurate data.
When considering a market planning consultant for one of the above-mentioned situations there are some important things to keep in mind. Don't begin the process unless the internal team is assembled, their skills inventoried, available information has also been catalogued, and management has clearly identified a weakness either within a particular business area, resources needed or in the proposed methodology. It is also very important that the team be open to external help. Once the need has been defined and agreed upon along with a skeleton definition of the type of consulting assistance needed and the desired outcome - then it is the right time to bring in the "right" consultant.
But it has to be the right consultant for the team - not all consultants are "right" for all companies and in all situations. The right consultant must have a clear credibility, ideally a specialty, in the very area where the team has a weakness and the problem to be solved can be clearly and definitively defined. The best match is a consultant where 'chemistry' with the team exists, domain expertise matches the defined problem, and together the project's objectives, methodology and expected results are defined and agreed upon. It is better to use a domain expertise consultant that has to learn your culture, values, etc. than it is to use someone that has to get 'up to speed' on your markets' domain knowledge.
When to bring in a consultant is a critical variable. Too early and the results can not be implemented with the anticipated outcome because the resources or infrastructure are not in place or because there are too many company variables which may change effecting an implementable strategy. Too late and the expected results become more difficult to attain become the company has already set out on implementing their course of action. The company is then placed in a position of having to double-back to implement a new strategy causing lost momentum, possible market risk and team discord. The trick is to know when you need a consultant and what the right timing is.
Managing consultants is the next step to ensure value is realized. The most frequent mistake made is to 'outsource' the entire project to consultants without active company involvement. The resulting strategy will be developed in a vacuum and after the consultants depart, no one within the company will fully understand the methodology used, assumptions made, or how conclusions were reached. To avoid these problems, view the consultant's role as an extension of the team and get a commitment that they transfer their knowledge to the team thereby strengthening the company's ability going forward.
Most leading software market strategy consultants utilize proven methodologies for achieving the project's desired outcome. Insist on a detailed methodology be followed or developed for the project and milestones are clearly defined. It will make the project easier to manage and easier to determine if value has been generated by the consultants.
A key point to remember in utilizing any consultants is that all projects have a beginning and an end. The consultants should conclude the project with written reports and presentations that include the methodology used, data sources, findings and conclusions reached, risks identified and recommendations for implementation. Unless there is a new project or need identified, the consultants work is done and they should leave. After all, it is the company's project team members that will drive events forward since it is they who should own the implementation and its success.
Christine Crandell is president and co-founder of NBS/New Business Strategies, a market strategy firm.
We're New Business Strategies. We Listen. We Craft. We Deliver. Other Published Works - Information on Speaking Engagements
© 2007 NBS Consulting Group, Inc. d/b/a New
Business Strategies |
 |
