Are You Ready For the Recovery?
Goldman Sachs’ Chief Economist, Jan Hatzius, said “as we go into 2014, we think there will be an acceleration in the global economy” with higher than trend growth values in the US and Europe, expected levels of growth in China and slightly softer economic performance in the emerging markets. At the end of last month, Mark Carney, Govenor of the Bank of England (pictured), revised the bank’s forecasts for economic growth over the next three years. But as the macroeconomic environment starts to improve, how are technology businesses meant to react to the news? In this news item, we ask four core questions for your business and provide some high level answers supported by case studies and white papers.
How will your market recover?
Planning how to deploy your resources really depends on when, where and how quickly your specific market recovers. Experience is always important in making these judgements, but it is especially difficult this time, since there has not been a recession like this since 1929. One solution is to start at a high level, using Scenario Planning or PESTEL (Political, Economic, Social, Technological, Environmental and Legal) analysis to explore the drivers of recovery, before moving to modelling the market. Alternatively, you could start by modelling several market recovery scenarios (in Excel) with different assumptions about timing, volume growth, pricing, geographic differences and competitor behaviour to help decide on the most likely recovery. Some of our clients have asked us to do both with them (starting with high level analysis followed by market modelling) and that approach gave some interesting insights. To find out more about modelling your market, please click here to download our white paper “Forecasting the Future for Profit” or click on two case studies. One is for a large company, HTC and the other for a new technology company, ScannerFutures.
What is your strategy?
If you have a good view about how your market will recover, then what is your strategy? Do you have a clear description of how your company will respond to the market opportunity? There are numerous books on corporate strategy (over 34,000 are listed on Amazon!) but at a practical level, strategy is your high-level plan to achieve one or more goals under conditions of uncertainty. Strategy means “generalship” in Greek. So like a general, you should picture yourself and your fellow leaders looking at the best data you have on the market, gaining an understanding of your own resources and those of the competition and setting clear high level objectives. To find out more about how you could review your company’s situation, evaluate resources and produce a company strategy document click here to download a case study on Ariana Pharma.
Are your products competitive and in a state to sell and deliver efficiently?
When you have a clear view of the market and clear strategy, then what is the state of your product portfolio? In the FMCG sector, there is a long history of product management and product marketing and most companies in this sector are completely product-centric in their culture and thinking. In the tech sectors this is less likely to be the case, with new products being developed, tested and released on a more organic basis.
One CEO told me his company’s products were “not released; they escape.” It is partly because technology products often create a market. This means many products are created to test the market rather than to meet an existing demand. Sometimes products are developed as a sideline to meet the needs of one customer and then get sold to other customers, turning a special project into a new product. Also, there is the product portfolio that evolves through M&A activity. Multiple products with different naming conventions, bought by different customer groups, with different terms and conditions, and overseen by different sorts of product manager end up in one company. In one of our client’s product portfolio, only one of the 19 product managers had had any formal product management training, none received monthly reports on their product’s revenue or profit margin, and none had a product plan. Through a series of planned phases, we analysed the product portfolio, worked with the company’s finance team to produce a product P&L report each month, developed a standardised product plan and ran a product management training course. These changes increased confidence in the competiveness of the portfolio and helped get the products in a state to sell and deliver efficiently. To find out how we could help you with your product management, email or call me on 01473 633124. Also take a look at the product section in our white paper “Success and Failure in Mergers and Acquisitions”.
Are you “front of mind” with your target customers and channel partners?
If you have a clear strategy and your products/services are ready to be sold efficiently, now is the time to ensure that you are “front of mind” with your target customers and channel partners. To make this happen, you need to know your messages and audiences, decide on the right medium and measure whether it is effective.
Starting at the beginning, deciding what you want to say depends on what you are selling and how your customer buys. Does your customer have a short term need, or will they spend 6 months or more in a tender process? Are you trying to raise awareness of your company or are you encouraging them to prefer you ahead of your main competitors? Depending on the market structure, the key audience may not be the customers, but trusted advisors or recommenders such as journalists, accountants or consultants. Customers may rely more on recommendation than their own internal decision making. Beyond messages and audiences comes the ever growing list of media; print articles, web, blogging, Twitter, LinkedIn, Facebook, newsletters, Google AdWords, events, advertising, sponsorship and more.
Two key lessons from the last 5 years are: (1) make sure you have enough content (and resource) to sustain that medium, (2) create time to measure performance and make improvements. Finally, make sure all your work is put into a plan with targets and measures. The competition improves and the market changes all the time, so review the plan and your performance regularly. You may find the PR case study at Subex or the brand refresh case study at Coderus useful for your company.
If you would like to discuss any aspect of the above article, please contact Nick Milner on: nick.milner@milnerltd.com or 01473 633124.
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