market research | LINE OF SIGHT GROUP

25 Jul

All Roads Lead to Services When Competing in Technology

Disruption has always been the norm in the technology industry. As all industries embrace waves upon waves of new technology…initially in the Cloud and with Mobility, then Analytics and Big Data, and now Artificial Intelligence, and Virtual Reality to name a few. Along with all of these advances also comes disruption.

Looking at the current state of the technology industry may reveal what is likely to happen in other increasingly technology-driven industries going forward. The Technology Services Industry Association (TSIA) has been tracking the largest 50 technology firms (IBM, Oracle, Microsoft, Cisco, Amazon, Google, etc) for the last 10 years. In the 2013/2014 timeframe, the aggregate services revenue line of the 50 technology firms crossed and surpassed product revenue and has not looked back ever since. Services now comprise nearly 60 percent of the total revenue mix of this group. But, the air coming out of the product side of the balloon is more than the service side has put back in, so overall revenue is flat or declining for most technology firms.

Where is it all going?

As products have given way to services, services have led to a focus on experiences, and experiences have led to the goal of achieving favorable business outcomes. It is likely that shifts like this will cause organizations to fundamentally examine the actual business that they are really in.

In many cases, this calls for a change in the very business models upon which they have been operating under. Accelerating this change is the arrival of well funded “Tech” firms – start-ups with deep pockets, seasoned management and highly scalable business models. There are lots of FinTech, InsureTech, HealthTech, LegalTech, etc. firms coming onto the scene. You might think of it more broadly as “YourIndustry”Tech with a well-funded group of start-ups going after the most vulnerable and profitable chunks of your industry.

What to do?

The move toward services requires a new set of disciplines, processes, and methodologies as well as new ways of thinking vs. product management. The field of service design is garnering a lot of attention lately within organizations of all sizes. Concepts like Jobs-to-be-Done, Service Blueprinting, Journey Mapping, Human Centered Design, Biomimicry, Virtual Reality, Ethnography, and more are shaping the next wave of new service design. Some of these concepts are well established while others are quite new. How they are combined is the exciting part.

One of the most important things to do is to take a hard look at your external environment (competitors and trends) and thoroughly research the opportunities and threats that you are facing. Once identified, these can inform your strategy formulation – the arenas, vehicles, differentiation, sequencing and economic logic of how you plan to operate. Once the strategy is in place, the specifics of go-to-market initiatives can determine how to move forward. And it is likely that new forms of services will play an increasingly important role on your roadmap as you go forward.

29 Jun

Pulling the Sales Intelligence Advantage Levers

One of the major trends in B2B selling over the past few years has been for sales teams to employ a strategy similar to management consultants – challenge, provoke and question clients and prospects about the status quo while building a case for a more compelling future. This approach has proven to be effective and requires a steady pipeline of relevant, specific and timely intelligence to back it up. Depending on the situation, there are a number of levers you can pull to arm the sales force with an intelligence advantage as they engage with executive level prospects.

The first lever is to conduct a Competitive Landscape Analysis – an exercise employing several management frameworks to review all forms of direct and indirect competition, relevant trends, opportunities and threats. This provides the sales team with a thorough understanding of their firm’s value proposition vs. the competition and relative to the market trends.

The next is to allow the Competitive Landscape Analysis to inform an ongoing Strategic Monitoring of announcements, updates and changes in the market. This ensures that the sales team is kept abreast of timely information and will not be caught off-guard when engaging with executive prospects.

Competitor Profiles can provide the sales team with a deep knowledge of the value proposition, positioning, differentiators, offers, customers, partners, personnel, and capabilities. Sales teams can use this insight to contrast themselves vs. their competitors when engaging with executive prospects. Battle Cards are a one page version of the Competitor Profile that focus on how to mitigate competitor strengths and exploit weaknesses.

Win/Loss Analysis gets to the heart of why deals are won and lost. Done correctly, they provide a wealth of objective feedback that the sales team can use to build upon strengths and learn from losses. The loss reviews provide some of the most useful feedback for improving the future win rate.

For sales teams heavily involved with services, Customer Experience Benchmarking can provide meaningful insight about the kind of service that their competitors are actually providing. This provides the sales team with the exact intelligence they need to outmaneuver competitors with customer experience issues.

Validating (or debunking) Competitor Claims in the market by interviewing a wide spectrum of people familiar with a competitor is an effective way to gauge the merit of market claims. Experience shows that many claims are false, putting the competitor on their heels and opening the door for a new approach to solving a problem.

The pulling of one or more intelligence levers will give the sales team a leg up by supporting their ability to approach executive prospects with knowledgeable, specific, consistent insight about their offer relative to the competition. This might turn out to be that slight edge when up against a competitor who might be ripe for the plucking.

23 May

Creating a Clear Line of Sight Through Inputs, Strategy and Execution

Last week Line of Sight Group delivered a presentation to the local chapter of the Product Development and Management Association (PDMA) entitled, “The Intersection of Strategy and Product Development/Management.” The event was held at Padilla in Minneapolis and attended by 50 product management and strategy practitioners. Line of Sight Group Founder and President, Steve Schulz, opened with the question, “what do these have in common?” The metaphorical slide had pictures of a dinosaur, a telephone booth and a Blockbuster Video storefront. All are now extinct, disrupted out of existence by stronger competitors that were better informed and equipped to survive. Why?

Doug Hedlund, Participating Faculty at the University of St. Thomas Opus School, offered the first part of the answer, a Strategy Formulation and Execution Discipline involving the capture of key factors (an organization’s vision, mission, core values and strategic goals), internal environment factors (strengths and weaknesses) and external environment forces (competition and trends) as inputs. Next, he walked through how the key factors inform the Strategy (Arenas, Vehicles, Differentiation, Staging and Economic Logic). Finally, he covered the execution levers (leadership, talent, organizational structure, systems/processes, and culture) and scorecard (metrics and dashboards) needed to successfully carry out the strategy.

Next, Schulz presented an interactive case study using the Strategy Formulation and Execution Discipline where the attendees helped to fill in the key inputs that shaped the strategy and execution. Schulz employed three useful frameworks to organize the external and internal data – PESTEL (Political, Economic, Societal, Technological, Environmental, & Legal) Analysis, Porter’s Five Forces Analysis and a Table Stakes Analysis in his presentation of the case.

Finally, Brett Norgaard, Line of Sight Group Principal, bookended the presentation with two stories highlighting the use of timely external environment intelligence leading to successful strategies and product launches under very different circumstances. (See Stealth and Telephone Switch blog entries.)

Starting with external environment research as the first step to creating a clear line of sight, from the inputs to the strategy formation and on through to the execution and measurement, ensures alignment of the strategic and go-to-market functions, including product development/management. Individuals that can identify and understand what is upstream and downstream from strategy formulation will be best positioned to help their organizations prevail and avoid extinction in increasingly disruptive times.

12 May

Identifying and Connecting the Dots at the Product Conf 2017

On Monday, Line of Sight Group attended the Product Conf 2017 put on by DevJam at the History Center in St. Paul. This year’s theme was “Product Chemistry.” There were several tracks of presentations focused on product management, business-based architecture, development operations, customer experience and user-selected topics. We jumped around to take in at least one in each area. Here are a few of the key takeaways:

Beware of lies disguised as statistics
Tell better stories
Look for problems – seen and unseen
Iterative design will take many unexpected turns
Focus on fewer, not more, ideas
Apply systematic innovation techniques to find the white space
Like fire, some products are discovered vs. invented
Construct the product roadmap by looking at problems in the context of customers before designing solutions
Anthropology can lead to sound insight about true behavior vs. asking alone

It was great to get away for a day, network, and think about how and why to connect the dots in the quest to create (or discover) new products.

25 Apr

To Increase CX (and Revenue), This Lender Gave Customers a Blank Check

Line of Sight Group constantly engages in activities to keep abreast of trends in innovation, customer experience, sales methods, service adoption and business model transformation. One trend we have noticed are the parallels in the disciplines of product management, service design and customer experience. Over the past few weeks, we have attended events and sessions in all of these disciplines and would like to share an observation demonstrating this convergence.

Representatives from the Baker Tilly firm shared an interesting Customer Experience (CX) case at the Product Development Management Association (PDMA) local chapter meeting the other day. It was the case of a lender pre-approving customers for vehicle purchases but then realizing that less than a quarter of the pre-approved customers actually returned to the lender to complete the loan. This was very disappointing to the lender as the process to pre-approve customers took time and effort. After performing a journey mapping exercise along with some current and future state analysis, the lender added one crucial step at the beginning of the process that changed everything.

What was the innovation? The lender started sending along a blank check valid for up to the pre-approved loan amount with the customer as they entered the dealership to purchase their new vehicle. This gave the lender’s customers a powerful tool that provided them more control over the buying experience, let them bypass the time in the financial manager’s office where they were subject to every conceivable cross-sell and up-sell tactic, and allowed them to drive away in their new vehicle without returning to the lender in advance.

Thus, a CX initiative impacted the nature of the service/product (a blank check was added), the process (avoidance of a trip back to the lender), a much better customer experience (less effort and avoiding the trip to the financial manager’s office), and a boost in business for the lender (fourfold revenue increase). In this case, the CX started with the sales process, impacted the product and service offer, as well as what the customer experienced on their vehicle buying journey. Understanding the external environment made up of the dealers and competitive lenders along with the customer journey enabled this lender to prevail in several key areas.

20 Apr

Line of Sight’s Competitive Intelligence System Now SCIP Endorsed

Line of Sight Group is proud to announce that our Market-i Competitive Intelligence System has been recognized as a SCIP “Endorsed” product!

Strategic and Competitive Intelligence Professionals (SCIP) is the nonprofit Association representing the Integrated Intelligence industry internationally for over 32 years.

What makes our system unique? Prior to launching Line of Sight Group in 2002, president and founder Steve Schulz conceived the Market-i System when he was running CI programs. According to SCIP, this makes the Market-i system unique and different because it was developed by a CI practitioner, not by a consultant or technology specialist with no background in CI.

The idea behind Line of Sight’s intelligence services offering, including our Market-i System, is that the most effective way for organizations to understand, respond to and anticipate changes in their external environment (not only direct competitors) is to collect and process information that best represents leading indicators in a systematic and ongoing way. It is done in such a way as to identify changes that are significant enough to deserve a more in-depth look. In addition, our intelligence services fit directly with our analysis services – we get to know our clients and their business and are uniquely positioned to help our clients develop deep insight and strategic options.

Line of Sight Group joins other service providers highlighted in SCIP’s (first-ever) 2017 Service Provider Assessment Guidebook – Highlighting SCIP Endorsed and Certified Services in ISCI. The guidebook is aimed at providing its members and potential users of these services some insight into the features and benefits that may be of service to their decision support program.

If you would like more information about our Market-i Competitive Intelligence System, please Reach Out! To learn more about SCIP or to become a member, contact them at www.scip.org.

27 Mar

Cargill Uses Competitive Intelligence to Sharpen its Global Customer Experience Program

One of the ways that Line of Sight Group keeps abreast of key marketplace trends is to attend industry association events. We recently attended an American Marketing Association (AMA) meeting that examined Cargill’s global customer experience model which is deployed to create consistently positive customer experiences despite a wide diversity of customers, products, geographies and markets. This approach is very comprehensive crossing multiple types and channels of customer interactions. One of the most important aspects of the process was to hold up Cargill’s customer experience to that of its competitors across the board. Knowing how you are doing with your customers is one thing, but to also know this relative to the competitive set is one of the elements that makes Cargill a market leader on a global basis. This is another example of a company committing to understanding its external environment and using the gathered insight to make good decisions.

06 Mar

Bob and Jerry on Competing in Healthcare

For the past several weeks, we have been busily reading the myriad articles and forecasts on Healthcare (HC) trends for 2017. There was even an article about all of the other articles. With trends like a dramatically changing regulatory environment, continued momentum in HC consumerism, advances moving big data and analytics into cognitive computing and Artificial Intelligence, value management, medical device and pharma innovation, mobility, cloud, security, privacy and so on, 2017 promises to be an exciting and challenging year. Not only are things moving fast, but there are a lot of them and the very foundations of the industry are shifting at the same time. If you are feeling a bit overwhelmed and seeking enlightenment, we offer the timeless wisdom of Bob Dylan and Jerry Garcia to make some sense out of the state of HC.

“For the times, they are a changin’” pretty well sums up the status quo. Thank you, Bob. For organizations competing in the HC space, it is particularly important to examine the increasingly complex and multi-layered external environment and to ensure that strategic plans are up-to-date, refreshed and aligned with the go-to-market initiatives. Leaders may also find themselves in the circumstance of playing offense and defense simultaneously. Some built-in flexibility goes a long way when there are well funded start-ups seeking to innovate by employing new, simplified business models and established organizations seeking to do some disrupting of their own. No matter where the threats come from or where the opportunities may lie, it has never been more important to listen to what is happening in the market, connect the dots and then convert this into insight that can be acted upon. There are a lot of factors to consider. Jerry rightly observes, “If the thunder don’t get ya then the lightning will.”

While most organizations conduct annual planning and align their go-to-market activities to the current conditions, it may not be enough. When in particularly challenging times, we might feel the need to regroup a bit and as Bob points out, “Come in, she said, I’ll give you shelter from the storm.” Leading organizations monitor their external environments continuously in order to anticipate market changes and make appropriate course changes. There are many methods to accomplish this that involve primary and secondary research, analysis and the pulling of various execution levers.

2017 presents potentially turbulent conditions. With a good and continuous view of the external environment, a sound and flexible strategic plan in place and solid execution, you will be able to navigate and compete successfully in the HC market. As Jerry sang, “May the four winds blow you safely home.” Good luck in 2017!

12 Jan

Telephone Switch Created to Bypass Love Connection

Almon Strowger was one of two undertakers in a small town near Kansas City in the 1880’s. He had a good reputation and a nice business. Then, things started to change for the worse. He noticed that his business was dying off dramatically. His close reading of the local obituary notices revealed that he was not getting the usual amount of business. In those days, homes were equipped with telephones that were on shared party lines. People often listened in on their neighbor’s conversations, too. To facilitate connections between callers, there was an operator who worked a cord switchboard at the local telephone exchange. When there was a death to report, a call came into the operator who patched the call through to one of two local undertakers on an “every other one” basis. Or so Strowger thought…

What Strowger uncovered in his research was that his competitor was dating the telephone operator, hence giving him the inside track to most of the funeral business in town. Needless to say, this state of affairs greatly frustrated Strowger and he complained to the local telephone company authorities…to no avail. His business did not improve. The operator ultimately married Strowger’s competitor and continued to keep most of the funeral business in the family.

Finding no hope with the status quo, Strowger switched strategies. By burning the midnight oil and using hat pins and electromagnets, he cobbled together a device that by-passed the operator allowing subscribers to directly connect to one another. On March 12, 1889, he filed his patent application and it was issued to him on March 10, 1891 as patent No. 447,918. He had invented the Telephone Switch. Strowger went on to form the “Strowger Automatic Telephone Exchange” late in 1891. Strowger’s first customer was the telephone company in LaPorte, Indiana with 75 subscribers. Strowger continued making improvements on the telephone switch over the years. He added feature after feature to make the phones more reliable, easier to use and less time consuming to operate. Conversations over Strowger Switches were private and did not require any human intervention to operate.

Strowger bragged that his systems were “cuss-less, out-of-order-less and wait-less.” With all of this functionality, it is not surprising that the Strowger Switch became the standard technology platform upon which the US and British telephone systems were based on until the 1950’s and 1970’s respectively. Strowger eventually sold his company and patent to the Bell Company which later became AT&T, Verizon, GTE and Lucent.

There are many lessons to be learned in this story:

• Know your external environment. Strowger kept abreast by reading the obituaries – he knew that he was losing market share. He also learned that the operator was linked to his competitor
• Have a back-up plan when disruption occurs. When his complaints to the local telephone company went unaddressed, Strowger set out to develop technology that would neutralize his competitor’s primary advantage – the operator’s discretion
• Learn what the market wants and needs. Strowger was relentless in his quest to perfect person-to-person communications

Be flexible and open to the possibilities. Strowger did his research, uncovered a need, innovated, and sold a solution where there were no competitors…quite a switch!

27 Dec

How Stealth Technology Became a Silver Bullet

Stealth technology provides the U.S. military with a dramatic competitive advantage in battle and as a deterrent to potential aggressors. Yet, its development nearly didn’t happen. The mathematical theories upon which stealth technology is based were actually developed by a Soviet scientist whose superiors were absolutely uninterested in his “crazy” theories and confusing equations. His frustration with his superiors led the scientist to publish a paper in a scientific journal. Here’s an example of a stealth equation for the strength of the reflected radar signal:

A Lockheed engineer in the course of keeping current discovered the Soviet Scientist’s article and believed that his Soviet counterpart was on to something. He approached his management and received a small budget and team to explore the possibilities and was set up in the Skunk Works operation at Lockheed. He led a team that developed the original stealth fighter. After building the initial prototype, he and his team invited some senior Lockheed engineers to review their work and provide feedback. The senior engineers were used to building speedy fighters with smooth, space age contours versus the strange looking, flat paneled surfaces called for in stealth theory. Many of these senior engineers doubted that the plane would even get off the ground.

Undaunted, the Skunk Works team continued their work and completed the prototype. By this time, they were nearly out of money and they had no orders yet for stealth fighters. They realized that they needed a straightforward method to demonstrate their value proposition. A radar scientist was brought in to perform some testing that involved gluing ball bearings to the nose of the prototype and zapping it with the radar gun. This revealed that the plane’s electronic radar profile was equal to that of a 1/8” ball bearing, about this size:

Over the next few months, the sales effort constituted rolling these small ball bearings across the desks of USAF generals. These brief and to-the-point sales presentations were accompanied by one simple question, “What if this was your fighter’s profile on enemy radar?” This technique led to billions of dollars and several generations of stealth aircraft sales to the U.S. Military.

There are many lessons to be learned from this story:

Research the external environment – the foundations of stealth technology were discovered in an obscure technical paper published by a “competitor”
Trust your instincts – “we’ve always done it this way” mentality nearly grounded stealth technology
Marketing messaging should be simple – while stealth technology is complex (theories and equations), its value proposition (radar profile of ball bearing) is not
Engage and sell the value proposition to those who can buy it – the USAF generals had all read and been influenced by Sun Tzu’s Art of War and sought “silver bullets” like strategic advantage and deterrence, not technical theories

In this case, the go-to-market team collaborated to research, develop, market and sell their new offer. The rest is history.