Transcript Product Management meets the Board Room

Integrated Product
Management
SVPMA March 5, 2003
Darlene K. Mann, CEO Siperian
[email protected]
Speaker Background
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Personal data
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Sales and Marketing for 12+ years
VC for 6+ years
CEO for 1+ month
Siperian Inc.
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Customer data management solutions
Unique composite object technology
“Aware Applications” offering a single point
of interaction for customer-centric activities
Agenda
What is “integrated” product
management
 What do Board of Directors (BOD)
care about?
 Why would product management
attract BOD attention?
 How does product management
speak to the BOD
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Integrated Product
Management
Executive management sets the
business plan
 Board of Directors approves business
plan and oversees results
 Product management is key to
execution of the business plan
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Do you understand the product
assumptions driving the plan?
Business Plan “Model”
Opportunity
(Discover)
Market
Problem
Buyer
Transaction
Business Plan “Model”
Execution
(Implement)
Technology
Product
Product
Company
Business
Business Plan “Model”
Opportunity
(Discover)
Market
Problem
Buyer
Transaction
Strategy
(Design)
Vision
Value
Proposition
Operating
Model
Financial
Model
Execution
(Implement)
Technology
Product
Product
Company
Business
What do BODs care about?
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Is the company operating well today?
Revenue
 Cost Structure
 Profitability
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Will it continue to do well in the
future?
Market opportunities
 Competitive Advantage
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Business Plan Concerns
Opportunity
(Discover)
Market
Problem
Buyer
Transaction
Strategy
(Design)
Vision
Value
Proposition
Operating
Model
Financial
Model
Execution
(Implement)
Technology
Product
Product
Company
Business
Problems:
Missed revenue/profits indicate execution
issues, if no strategic cause
“Operational” Problems

Revenue model cannot support the
necessary cost structure
Customer acquisition costs too high
 Channel costs too high
 Operating expenses or COGS
increase substantially (e.g. cost of
labor, materials, etc.)
 Poor expense controls (shameful!)
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Business Plan Concerns
Opportunity
(Discover)
Market
Problem
Buyer
Transaction
Strategy
(Design)
Vision
Value
Proposition
Operating
Model
Financial
Model
Execution
(Implement)
Technology
Product
Product
Company
Business
Problems:
Product misalignment or market saturation
create strategic issues
“Value Proposition” Problems

Problem isn’t big enough to matter
Market was never big enough
 Market now saturated
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Product inadequate for problem
Poor execution
 Poor vision
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Competitive price pressure
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Value undermined
Business Plan Concerns
Opportunity
(Discover)
Market
Problem
Buyer
Transaction
Strategy
(Design)
Vision
Value
Proposition
Operating
Model
Financial
Model
Execution
(Implement)
Technology
Product
Product
Company
Business
Problems:
Market disruption creates strategic issue
“Vision” Problems
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New technologies
Better, faster, cheaper
 Direct competitor or substitute
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M&A events
Channel strength
 Product line completeness
 Critical mass effects
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Why would Product Management
attract BOD attention?
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Missed revenues or profitability? Inspect:
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Channel
• Direct/Indirect sales metrics
• Contribution across channels
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Product
• Evaluation of market opportunity
• Feature/functionality/fit analysis
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Underlying cost structures
• Structural changes to cost
• Poor management
Why would Product Management
attract BOD attention?
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Value proposition under fire
Customer adoption
 Competitive pressure
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• Out-selling
• Better product
• Price pressure
• True cost advantage
• Buying share
• Lousy competitor
Why would Product Management
attract BOD attention?
Overcome by disruptive technology
 Industry structure change
 Too early
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How should Product Management
speak to the BOD?
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Financial expressions of issues
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Data-driven, clear about sources
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Explain what and how you know
High level
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Quantify it when possible
Relevant to the big issues
Place/Process/Progress
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Where did you start, what is your goal
How will you get there
Where are you now
Summary
From the BOD perspective, everything
nets to financial performance
 In tough times, understanding the
expected business model behavior is
essential for financial success
 If your product line is not conforming
to the model, understand why and
what can be done
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