Mind the Gap - Ten Steps to New Service Propositions
Recent CEO studies bring home one important point – customers are facing challenging times; no question. But what CEO’s seem most exercised about is that the gap between existing capability and current challenges is widening at an alarming rate. As a consequence, business model innovation is taking CEO centre stage – but where’s the capability ? With the increasing emphasis on outsourcing vendors being asked to take partner status – clearly the opportunity is ripe for us to use the slowdown to turn inward and build the kind of solutions which will enable gap bridging. However, how to build a quality solution in IT services is clearly a problem to which different firms have different answers – I am now going to attempt to cobble together stuff I heard in a variety of discussions into a possible 10 step approach …
1. Identify the Lighthouse : there are a million problems out there – which one do we try and solve ? While there seems to be lots of sources, the overall consensus appears to be Customers. This is a services business and we will not end up with a tangible product to show. We will however, if done properly, end up with a customer who can be referenced. It makes a lot of sense to go to key customers and collaborate – join hands to find key problem areas. Agree on a specific high impact area and agree on a co-investment model. I do not mean co-invest only in monetary terms – it could be basis an agreement on Go to Market responsibilities etc etc. The Lighthouse stage is the one when the solution plan and budgeting needs to be done – simply because we need the customer to agree and contribute to it.
2. Identify Partners : With the lighthouse in the pocket – it is important to play out a partner stage. You can decide not to invoke this – but take a look at it. Typically a services solution will require IP – I believe services firms should focus on IP in the service delivery space. Product related IP is ideally sourced from partners (on a best of breed basis). The plan in stage one should now be rolled out to identified partners and they need to be integrated into the plan. This is give to get – they should put skin in the game as well.
3. Constitute the team : Without the prior two stages this would be impossible. A homogenous team needs to be constituted which should have marketing and solutioning skills – ideally this group should include members from the lighthouse customers and the partners as well. A social networking platform should be put in place – accessible only to this team on which the development should happen. The team needs to clearly articulate timelines, responsibilities, gates and a mutually acceptable interaction schedule. Each interaction should definitely be gated with a positive outcome.
4. Deploy : With the solution getting built out, it needs to go into implementation in the lighthouse. Extraordinary care needs to be taken at this stage – because the customer participation till this point is probably on the IT side. The guys who will now engage in it will typically be from the business side. As a consequence the launch, rollout and management of the solution in the client side needs to be thought through from a benefits based buy in, adequate planning and change management and post go live support. Remember – this is the ultimate proof of concept. Only if it is wildly successful will the next part of the program really happen.
5. Evangelise : Once deploy passes it’s planned gates, that’s when the solution should emerge from the Product Development (PD) box and get into the Business Development (BD) box. The first part of the BD process has to be pre-position. Even before the sales guys hear about it, which definitely means before the customer hears about it ; something needs to be done to set up the market in a way that it will believe it when it comes out. Significant engagement with analysts to bounce hypotheses etc is one good way of doing this. The core team needs to deliver a set of people who will act as the evangelists and start engaging with influencers, customers (through Advisory councils and such like) , consultants and anybody else who can have the dual impact of sharpening the solution as well as impacting pre-position in the market as a whole.
6. Commercialise : The good thing about a well done evangelise stage is that the E-Team will have built an extremely good understanding of the value the solution can offer. This is the time the finance team needs to be brought in and work needs to commence on finding one or many (context specific) commercial models with which the solution can be taken to the market. In many services solutions – the key source of competitive advantage can get built here. The point to remember at this stage is – if the solution is new, a number of assumptions and hypotheses will go into commercializing it. The team needs a commercial director at this stage whose role will be to construct the deals that come along – as well as to monitor impact and outcome to build a learning curve into the solution commercials.
7. Sales Excellence : Solutions selling is not easy. This is the stage which can derail the solution completely – if the sales team is unable to articulate it, find the right customers or negotiate the deal. This is the time to go back to step 1 – unearth the sales team responsible for the lighthouse and build them into the process of making the solution palatable to the rest of sales. Key components that need to be built in are Collateral, Training, Reference Management , Playbooks, qualification processes, sales analytics (therefore systems and data), incentives and very high quality pre sales support. There is absolutely no point generating a marketing campaign around a new solution without going through this stage.
8. Collaborative Improvement : The original networking platform which began with the core group now needs to expand to the larger universe of people who are now engaged (including all sales). This platform will now require dedicated management so that enough discussion and sharing starts on it for capturing areas for improvement.
9. Marketing Campaign : Finally we are ready to spend some big bucks on a high impact campaign. I have written extensively about how campaigns need to be put together so I will not repeat this. However, segmentation and targeting will become of enormous importance in the solutions world. If the partner stage was invoked it makes sense to bring the partners into the campaign as well.
10.Centre of Excellence : Having done all of the above – chances are the business has started moving. It is now time to make the provision of the solution effortless and sustainable. Setting up a COE which will now drive this solution and its derivatives can ensure both continuous improvement as well as legs to run for a long time.
The big question – who is going to do all this. My opinion – marketing is the only unit which can cut across as many silos as the 10 steps require; and has to drive and program manage this whole effort. As a consequence, it is clearly time to get a robust New Service Introduction team into the marketing force. If we mind the gap well enough – the gap itself becomes opportunity.