secrets market driven leaders

8/6/2019 Secrets Market Driven Leaders

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The of Market-Driven Leaders

by Craig Stull, Phil Myers, and David Meerman Scott

How technology company CEOs create success

(and why most fail)


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The Secrets o Market-Driven Leaders:How technology company CEOs create success (and why most fail)

2

The authors wish to thank the CEOs who

graciously agreed to speak with us while

we were researching this e-book. Without

their insight, this e-book would not

have been possible.

Please eel ree to post this on your blog or e-mail it to

whomever you believe would beneft rom reading it.

Thank

youCopyright 2007 Pragmatic Marketing, Inc. All rights reserved.

Copyright holder is licensing this under the Creative Commons License. Attribution 3.0.

http://creativecommons.org/licenses/by/3.0/

Other product and/or company names mentioned in this e-book may be trademarks or registered trademarks of their respective companies and

are the sole property of their respective owners.
http://creativecommons.org/licenses/by/3.0/http://creativecommons.org/licenses/by/3.0/


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In 1993, Apple Computer (now Apple, Inc.) released the Apple Newton to great anare.The Newton was a product that many people within the company thought would reinventpersonal computing. On the heels o two huge successes (the Apple II and the Macintosh),

the mission seemed plausible. With the hype and buzz that has become a hallmark oan Apple product launch, early Newton advertising proclaimed: The astonishing newinvention that has room or your whole world but ts in your pocket. It manages your days,your names, and your numbers. It sends axes and replaces your pager. It makes writingreadable. It can draw even i you cant. It talks to computers and printers. And what youdont know, theres a good chance it does.

Wow.The Newton claimed to do virtually everything, including things you donteven know! The driving orce behind the Newton? Then Apple CEO, John Sculley.

O course, we now know that the Newton was a dismal ailure. In April 2007,Computerworld declared the Apple Newton one o the 21 biggest technology fops o alltime. The Newton missed, by ar, its original goals to reinvent personal computing andit never met Apples expectations. Critics and Apple insiders alike were quick to pointto specic reasons or ailure. Pundits said it was too expensive and that the grati-stylewriting system was too dicult to use. The unit was too big to comortably t intopeoples pockets (too bad the urban huge pocket craze hadnt yet started).

Our frst product was a winner but the reststunk. What happened? Did our market dry up

or did we just get stupid?

An unnamed and currently out-of-work CEO


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Contrast the launch o the Apple Newton with the Apple iPod introduction. Launched in2001, iPod advertising was exceedingly simple: 1,000 songs in your pocket. Apple CEOSteve Jobs, now back at the helm o the company he co-ounded, led a development eort

ocused on solving a problem in the marketplacecreating an elegant and simple portabledigital music player that anyone could use. Prior to the iPod, MP3 players were crammedwith eatures and unctions and buttons and sported sotware that was dicult to master.Now, just six short years ater the iPod introduction, with over 72% market share and morethan 100 million units sold as o March, 2007, the iPod is one o the worlds most popularconsumer brands.

Whats going on here? The same company creates two major productintroductionsone a spectacular success and the other a dismal fop.

The Dierence is Outside

Why do some products ail while others succeed? That question keeps many CEOs, venturecapitalists, employees, and shareholders up at night. Customers want to know too, becauseater all, they are spending their money on products.

At Pragmatic Marketing, our business is to study technology-company leadership, marketingand how companies develop best practice methodologies or creating products people

want to buy. We train, and provide services to the teams that develop and market these

products. Weve studied the introduction o thousands o products across the technologyindustry, including those rom big, well-known companies like Intuit, SAP, Microsot,

EMC, CA, Iron Mountain and SAS; breakout products rom Blackberry, Salesorce.comand Google; and oerings rom startup or niche players you may have never heard

o like WebSense, Macrovision, FeedBurner, Act!, and AccuMap.


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Recently, our ocus has been studying the DNA o market leaders. Weve surveyed our40,000 alumni at 3,000+ customers and compiled data or the past ve years. And, in early2007, we sat down or one-on-one discussions with 30 CEOs to dig deeper into what they

think it takes to be successul. Drawing rom our research and these discussions withCEOs, we looked at culture, organization, and process or building products; strategiesor optimizing go-to-market plans; and measurement o best practices.

Our research validated anecdotal inormation that market-driven companies are 31% moreprotable,[1] twice as ast to bring products to market, twice as likely to lead,[2] and enjoy20% higher customer satisaction rates.[3] We also ound that there is a much moreundamental reason or product ailure than eatures and price. By pulling this inormationtogether into this e-book (and a ull-length print book available mid-2008), we will showyou how to dramatically increase the likelihood or your success. And while it is possible

to be successul by ollowing a path dierent than what we outline here, the risk actorso going down an alternative path are much greater.

In act, our research helped us uncover some startling observations about Applewhich all technology company CEOs can learn rom. Based on the evidencecollected, we eel that the utterly dierent leadership stylesparticularlythe market-driven leadership habitsat Apple under John Sculley and SteveJobsis the dierence between ailure and success. Were convinced thattypical technology company culture leads to the kind o inside-out thinking that

creates products like the Newton. The development process becomes bloated with stuthat company insiders thought was cool, but that people werent prepared to plunk downmoney to buy. However, once a companys leadership ocuses outside-in (paying attentionto the needs o the marketplace), it results in the development o breakthrough productslike the iPoda product that solved an unmet market problem (an easy-to-use MP3 player)and one that people were happy to spend money on.

We heard a lot about the paradox o growth. We also heard that all CEOs want tobe market-driven (but so ew actually are)so we asked why is it so challenging

to become market-driven?[1] Derived rom George S. Day and Prakash Nedungadi, Managerial Representations o Competitive Advantage, Journal o Marketing 58 (April 1994): 40[2] SotwareMinds Best Practices report. 2004. http://www.sotwareminds.com/pm.asp

[3] Summarized rom Pragmatic Marketings interviews with 30 technology CEOs

Why is it so challenging to

become market-driven?
http://softwareminds%20best%20practices%20report.xn--%20004-555t.%20%20http//www.softwareminds.com/pm.asphttp://softwareminds%20best%20practices%20report.xn--%20004-555t.%20%20http//www.softwareminds.com/pm.asp


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Market-Driven TechnologyCompanies and Success

There is absolutely no doubt that the evolution o technology companies ollowsa predictable pattern. The success o the initial product is a rush, intoxicating oreveryone involved in the company. However, too oten, its short-lived. In the

predictable evolution o a technology company, the second and third productsdeveloped (like the Apple Newton) almost always ail. Why? Evidence shows it isbecause the entrepreneurs who started the company and who understood buyerproblems soon become occupied with the details o running their organization. Theyno longer ocus on buyer problems and building products the market wants to buy,but rather they obsess about the details o managing an ongoing business like hiringand ring, nance, oce space, investors, and the like. Outside pressure orcesthe company to become the opposite o a market-driven company.

competitor-driven (creating copycat productsand services and entering the same vertical marketsas competitors).

customer-driven (letting existing customersdene extensions to their products, sometimes

creating a market o one).

sales-driven (adding channel capacity to drivevolume or existing opportunities and deningdirection by the current needs o prospects).

Sales-Driven

Market-Driven

Competitor-Driven

Customer-Driven

Technology

Driven

UnitSales

Growth

Customer Satisaction

Path toProftability

2007 Pragmatic Marketing, Inc.


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There is a dierence between building the rst product and building subsequentproducts, says Marc Sokol, co-ounder o Realia, a company he built and then sold toComputer Associates, assuming the role o Senior Vice President and General Manager,

Global Marketing or Computer Associates International, Inc. (CA). Today, Sokol is onthe board o nine technology startups. With the startup company and the rst product,the germ o a good idea comes rom an innovation that solves a problem that customershave. Sometimes they are your customers or customers that you are amiliar with, perhapsbecause you yoursel have the need or the customers o your ormer employer had theneed. The innovation is sparked by a need, a pain point, something they wished they

had. In that early stage, you are swimming in the sea othe potential customers problems. And you can learn.Then it is the science o validationdoes anyone else doit? Is it a eature o an existing product? A new product?

Or does it require a new company?

According to Sokol, the problems happen when establishedtechnology companies move on rom the initial successbecause those companies are infuenced by the worldthat they are in. The company that already exists hascustomers that are sel-selected because they are already

customers, he says. So i they only speak with existing customers they are not gettingthe ull picture. You have to approach non-customers to get a sense o their needs,

too. For example, i you are IBM and selling DB2 and you talk to DB2 users abouttheir problems, you need to understand that those products may only be applicableto DB2 users and non-users.

There is a dierence between

building the frst product and

building subsequent products.

Marc Sokol

co-founder of Realia


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The same challenges, identiying market problems, also exist when building an outboundmarketing strategy. To segment the market, you need to nd customers with the painpoint, Sokol says. Sometimes the biggest pain point is dicult to nd. For example, onecompany I work with sells a product that is best or companies with lots o locationsthings like banks with lots o branches and retail with lots o stores. So the lead-generationeort with that company is ocused on reaching companies with lots o locations. It isa eedback loop where marketing people, Sales, and the CEO track the buyers pain

points. Determine the most valuable part o the product and then nd othercustomers that have similar needs. Your customers and customer storiesare much more credible as a result. I I have Starbucks as a client, thenit is easier to sell to McDonalds.

So, how do you keep the right DNA in place as you grow? We ound

convergence around a set o success actors (and we also identiedsome common mistakes). These actors ormed the dierence

between the success o market-driven leaders andthe rest o the pack.

How do you keep the right

DNA in place as you grow?


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The 7 Secrets o Market-Driven Leaders

We went back and reviewed notes rom our discussions with CEOs and our survey data,

and ound some striking similarities between the companies that are winning in themarketplace and those that are struggling. Behind the scenes, seven critical success actorsemerged. So pragmatic were these secrets that most o the CEOs we talked with treatedthem as nothing more signicant than looking both ways beore crossing the street. Sopowerul are these maxims that the companies that use them operate with a sense ocomort while those that do not seem to be constantly struggling.

This e-book is a ocus on the seven secrets. Each one is described in detail and supportedby interesting case studies o successul CEOs, in their own words. Examples o Fatal

Flaws that less successul companies are doing are also presented.

SECRET #1= Work as a Trusted Advisor

SECRET #2= Build from the Outside-In

SECRET #3= Simple is Smart

SECRET #4= Leadership is Distributed

SECRET #5= Stop Being a Vendor

SECRET #6= Marketing with a Big M

SECRET #7= Measure only what Matters

Our research is ongoing and we will oer much more in our book coming mid-2008.But or now, were condent youll be thrilled to learn the secrets.


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Work as a Trusted Advisor

The way todays leaders create a sustainable, growing, and successul company is to instilla company culture o working as trusted advisors to prospects and customers alike. Leadingcompanies understand market problems and buyer behaviors beore building products.These companies appreciate learning rom their existing customers, but, it doesnt stopthere. They also recognize that current customers are not their only target market and thusstudy market problems o non-customers as well. They interact with the market, not onlyto ask questions, but to participate. So valued is their knowledge base, these leaders areviewed as market experts in their vertical market and industry, and oten participate intheir customers strategic orums.

People in market-driven companies largely ignore the competition. And they mostdenitely do not care about technology or technologys sake. Instead they ocus amajority o their energies on the problems that buyers are willing to spend money tosolve. By rst understanding market problems, then building the products people wantto buy, and communicating to buyers an understanding o their problems, everythingelse alls into place.

Consider FeedBurner, the pioneer provider o media distribution and audience engagementservices or blogs and RSS eeds. The company, ounded in 2003, also oers the largest

eed and blog advertising network anywhere. We look or trends in the marketplace thatwill cause spiraling complexity or our customers and develop products that address thesechallenges, says Dick Costolo, co-ounder and CEO o FeedBurner. When we startedFeedBurner, RSS was already out in the market and people were beginning to use it. So wesaw that the uture o media was likely to be distributedinstead o people just going toone publisher web site, they would get eeds rom a variety o places like sites and mobiledevices. We thought i that happens there will be spiraling complexity or the publishers ocontent because people no longer come to one site but get eeds rom all over the place.

The last time I checked,

there were no buyers at ourcorporate ofcesso maybe

we should fgure out how to

spend more time in the feld

with them learning about

what they need than we do

here with us guessing! Pat Sullivan

Creator of ACT! and SalesLogix

#1


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With a undamental understanding o how the technology can help customers, the CEOsjob is to create products the market wants to buy. We did talk to publishers about eedsbut mostly we saw change coming and built products to solve the problems we anticipatedcoming, Costolo says. We saw the trends such as the vortex o complexity aroundadvertising in eeds. That has helped us to understand what not to spend time doing. Forexample, there are a bunch o instances where third-party people have said we should doa eed search engine. We looked at those opportunities and decided that was not somethingto do because others are already doing that.

An important characteristic o early stage companies is the CEO and otherleaders within the company are very active in the marketplace. Not yetbogged down in the intricacies o running a larger and more ar-fungbusiness, they are close to the markets they serve. Oten, the CEO is

extremely hands-on like Costolo at FeedBurner. I own the go-to-marketstrategy, he says. I develop a business case solely around the vision

or what we want to provide to publishers. For example, we decided that we wanted tocreate detailed metrics around the widgets that we provide to publishers. The marketingcommunications and strategy around launching this was to talk about how these widgetscan help them to promote and measure awareness to eed owners. We are very satisedwith our market position and how people see us in the market and we are very satisedwith our market share, which is about 90% or 95%.

The CEOs job is to create products

that the market wants to buy.


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Ater Innovation, What Next?

As early-stage technology companies like FeedBurner begin to scale, there is the very

real challenge o keeping the trusted advisor culture intact. While in startup mode, theculture orces outside-in thinking. But as companies mature, people tend to look inwardor answers, which almost always lead to struggles and can oten mean ailure. This iswhere market-driven leadership plays a critical role. Leaders at successul companieskeep pointing people outward.

I believe that most great product ideas come rom somebody bumping into a problemthat nobody is solving through personal observation, says Pat Sullivan, creator oACT!the best-selling contact managerused by millions o business proessionals

around the world and SalesLogix, the leading mid-market customerrelationship manager. Where is there a hole in the market to dosomething that nobody is doing? That is the best way.

Sullivan recognizes that nding unsolved problems in the market is verydierent than looking at existing products as a starting point. Some peopletry to look at existing products and see how you can make it dierent, hesays. But with a product like YouTube, how would you create a YouTubecompetitor? It is already done.

According to Sullivan, the key is to continually ocus on market problemsas a means to identiy opportunities. When I started SalesLogix, it was an

exercise to re-enter an area I already knew. I looked at what the hole was in the salesorce automation market. What problems could be solved? It looked like there was roomto compete with ACT! Sullivan discovered that there was a hole in what he dened as themiddle marketsmaller organizations needed a solution that was as simple and easy touse as ACT! while at the same time providing corporate networking o data and real-timeopportunity management. The low-end retail store level was taken with ACT! and thehigh-end large enterprise direct sales model was owned by Siebel. So we went middle

market with a VAR sales model.

I believe that most great product

ideas come rom somebody

bumping into a problem that

nobody is solving...

Pat Sullivan

Creator of ACT! and SalesLogix


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Believing your own BS

Inside-out thinking is dangerous. Sometimes technology company CEOs develop acult-like eeling about his (or her) powers and market-knowledge based on an initialcompany success. The CEO believes that he can just dream up new ideas or technologyproducts that the market wants to buy because hes done it beore. Whats oten letout o the ormula is the key ingredient o how it was done beoreby listening to themarket and becoming a trusted advisor to the industry. In todays complex technologyenvironment, there is no such thing as the entrepreneurial dreamer sitting in an isolatedoice creating technology products. Although there are rare exceptions, in the vastmajority o inside-out developed oerings, the market does not want to buy the productscreated. Was the Apple Newton developed this way and thats why it ailed?

#1


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Build from the Outside-In

Market-driven leaders understand the complete picture o market problems beore buildingproducts. They develop solutions in the context o the total customer experience. Productmanagers, executives, and marketers in technology companies regularly meet with peoplein the marketplace and observe how they do business in order to understand the ull scopeo their usage requirements and their most signicant obstacles to adoption.

The most important thing they do is to live in the prospects world and look at all thetouch points that matter. Leading companies interview potential customers and study whatthey do. When Scott Cook rst built Quicken, he actually went into homes and studied theprocess o how amilies paid bills and managed their nances. He didnt rely on intuition,

or competitive intelligence, or the advice o smart riends. Instead, Cook directly observedthe problems his potential customers had in his chosen marketplace.

In depth interviewing (like Scott Cook did with amilies) is by ar the most eective way tolearn about market problems and meeting with people on their own tur (or example, intheir workplace) is best. But other ways include joining industry associations and attendingconerences your buyers attend to understand the issues. Read the same blogs and tradepublications that your buyers read. This knowledge is the starting point to know whatproducts to build.

The nishing touches come rom putting the right bridges in place to ensure that the totalcustomer experience is complete. How successul would the iPod have been i it ignoredaccess to music (through relationships with industry to distribute) and the medium orsimple downloads (iTunes)?

A habit o creating a company culture that develops products people know theyneed and want to buy because the picture is complete (like the iPod) is theultimate sustainable advantage.

#2

Customers dont care about

your products in the long run.

They care about solutions

to their own problems andvisions. Once a technology

company understands this and

ocuses on delivering solution

value, everything changes or

the better. They operate with

more clarity, create long-term

customer relationships and

become more sought ater in

the marketplace.

Fred Amoroso

President and Chief Executive Officer

Macrovision


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What do Buyers Need?

Dealer.com, a major player in the automotive web solutions space, builds web sites

and web-based sales tools or dealerships across North America. Mark Bongli, CEO oDealer.com says, In 1994, we originally built our product within a small auto dealershipthat I ounded that utilized the Internet and did not have salespeople. We built out a websolution that launched in 1996 by solving a real-lie problem or both dealers and peoplewho want to buy cars without the hassle o auto sales representatives.

As the web became a place or people to shop or all kinds o products, Bongli learnedthat car buyers wanted to shop online and compare models and dealers without visitingthe showroom rst. This posed a challenge to traditional dealerships that have been runor decades on the walk-in customer model o direct sales. Because auto dealers arenot experts in Internet technology, an unmet market problem existed that Dealer.comidentiedcreating web sites and web-based systems or auto dealers.

From the initial product o an auto dealer web site, Dealer.com has gone waybeyond the original idea to web services or auto dealers to manage marketing,sales, inventory management and more. In all cases, Dealer.com is totally ocusedon understanding what problems auto dealers have that can be solved by webtechnology. We keep guring out what our buyers (the auto dealers) need,Bongli says. We still own our own dealership but we go into many others to

nd the problems that other dealers havenot just with our type o product butwith all kinds o products rom other vendors. We are in regular communicationevery week with many auto dealers, both existing customers and potentialcustomers. Because o that, we pull and receive eedback on a regular basis.

Improving the product is built into our company DNA and we keep morphing the product.For example, we have a sophisticated customer relationship management solution thatwe built or our auto dealer clients that includes innovations that the market needs likedragging inventory (cars) into an e-mail and instantaneously sending it to Mrs. Jones.

We keep fguring out what

our buyers need.

Mark Bonfigli

CEO

Dealer.com


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Bongli says the reason Dealer.com maintains a clear edge in a competitive marketplaceis that they continually work with both buyers and existing customers. Built into our CRMsystem is a library o 100,000 auto dealers, some are customers but many are not, he says.I can quickly show any potential client 50 dierent permutations o a web site solutionor any dealer. Why wait eight weeks or a prototype when you can have a solution ineight seconds? I someone calls or e-mails us with an inquiry, I can show them somethingcustomized just or them in an instant.

As o early 2007, Dealer.com, the number three player in the industry, was growing by80-100% per year and plans to grow rom approximately 125 employees to 175 by theend o 2007. Bongli says that by the end o 2007, the company should be between$25-$30 million in revenue. We will never be satised until we are the number onestandardized solution or the auto industry. he says.


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#2

Building things you could, not should

Creating products because it would be cool to build, or because the CEO thinks it would succeed, orthe Venture Capitalist says so, or one customer asks or itare much more likely to end with a Newton-

like ailure. Does this scenario sound amiliar? One o your better existing customers comes to you witha product enhancement request and says theyre willing to pay you a lot o money to build it. Buildingthe enhancement sounds exciting to your team. And the revenue can make your quarterly numbers.Your inclination is to sign a deal on the spot. Do you build it?

I you understand the secrets o market-driven leaders, you know that you cant make a decision to acceptthe enhancement unless you understand what it means to your marketplace. I you know what the marketwants and the enhancement request comes in, you might be in luck! You can get one customer to pay orsomething the entire market can use. But without looking outside, you only look at incremental cost and

not the opportunity cost o addressing the broader market and you could end up serving a market o onewith the enhancement with only a ew dollars to show or the eort.


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Simple is Smart

Whenever market-driven leaders create products or solutionsor potential newcustomers, existing customers, or even new marketsit is always in the context ocreating a simple solution to the problems people have. Contrast this with the developmentand marketing programs o the typical technology company. Most companies deliversolutions and messages rom their own narrow, insular, and egotistical perspective.They talk about the new super widget. They announce a new eature. They obsess aboutthe latest revision (version 2.309b). They insist on comparing their widget against thecompetition by using superlatives and jargon. What these poorly executed programsdont do is speak directly to the market problems that people have and in simple terms,describe how technology can solve those problems. Most products and communications

are hard to understand, hard to use and worst o all, completely out o contexto the total customer experience.

The best companies create solutions that are narrow and deep. They organize arounda single market problem and solve it completely with a solution that to the buyerseems simple, obvious and most importantly handles all the related tasks in one easystep. Oten, this means specializing in a single vertical market or industry. Customercommunications programs are not one size ts all either. Instead, tailor to the contexto each market or industry you serve.

Consider EqualLogic, Inc., a company that delivers a consolidated iSCSI-based storagearea network (SAN) solution or small- and mid-sized companies. Our strongest bando potential customers is 100 to 5,000 employees range, says Don Bulens, Presidentand Chie Executive Oicer o EqualLogic. The company was ounded on themassive problems around data recovery and data availability that created a burdenon mid- and small-size companies. The product and the go-to-market strategywere built around this problem.

#3

Whatever happened to

frst mover advantagerom having a disruptive

innovation? My portolio

is getting killed by copycat

products rom companies

that execute better.

Venture capitalist still recoveringfrom the .com hangover


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Bulens says that a undamental principal o the company is a ocus solving storage problemsand the company communicates to potential customers simply, and in the context o thisproblem. At our monthly sales meeting, I say that EqualLogic helps customers to ease theirstorage pain, he says. Everything revolves around the market segment we ocus on andare trying to orm as deep a relationship as we can with our customers. Those intimate

relationships with customers are the most important thing or us.

To lead the customer ocus o the company, Bulens hired a senior-levelexecutive as Director o Customer Programs and EqualLogic has ormeda customer advisory group. They have also turned to web-basedtools. We developed a message board orum initially or customersand the Customer Service Department to interact, but we have agoal to open it up to everyone, including buyers, the media and

analysts, Bulens says. EqualLogic also has a customer-oriented blogcalled Storage @ Work (http://www.equallogic.com/blog/) writtenby Marc Farley, the Director o Customer Programs.

We measure everything and then pick what matters and measure thatreally well. For example, the rate o new customer acquisition, Bulens

says. He sees tremendous opportunity in the market that EqualLogic is helping todene, and his strategy is to ocus on communicating with his customers, simplyand in context o their problems.

The storage industry is the last place o vendor tyranny in the IT industry, Bulens insists.Michel Dell helped to simpliy computers and Cisco helped to simpliy networking.Storage needs to be simplied. Companies o all sizes had their storage capacity growingby 50% per year and the existing storage solutions are amazingly complex. Our technologyhas radically simplied storage and made it really easy, so customers save time and money.Our market, storage deployed over Ethernet, has tens o thousands o target customersand is expected to be $5 billion by 2010, according to IDC. With a ocus on partneringwith customers to solve problems, EqualLogic has grown in just six years o existenceto the number two player with 15% market share according to Gartner and the numberone pure-play in the business.

Everything revolves around the market

segment we ocus on and are trying to

orm as deep a relationship as we can

with our customers...

Don BulensPresident and Chief Executive Officer

EqualLogic
http://www.equallogic.com/blog/http://www.equallogic.com/blog/


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#3Dead chicken parts

Ever wonder i companies like KFC, or Tyson Foods, or Perdue Farms would be successuli they described their products using inside-out thinking? Hmm Chicken. Hey, KFCmight say, Would you like to buy some packaged dead chicken parts? Were an end-to-endsolution or the killing, chopping, reezing, cooking, and packaging o chicken. Yet, this iswhat most technology companies do. Instead o understanding the market and deliveringmessages to them, companies mistakenly worry about understanding what they have andhow to get a group o customer-acing evangelists to pitch a new idea to the market.This results in expensive one-way communications that bore customers, and take yourcompany arther away rom prots.


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Leadership is Distributed

At industry-leading organizations ocused on a market-driven approach, companyoperations are driven rom the business unit or product management level. Leadership isdistributed. Why? Because the business unit leaders and the product managers who workthere are the people who are closest to the marketplace and best understand the problemsbuyers ace. Product managers and business unit leaders are the people charged withdeveloping the products people want to buy. Winning companies recognize it is better todistribute leadership and to employ a bottom-up strategic planning process that drives thebusiness orward than it is or unctional senior managers to collaborate on decision makingand push new strategies, processes, and plans out to the organization.

Top down is much less likely to succeed. At many o the struggling companies that weveworked with, strategies or the business have been developed outside o an understandingo market problems. At these less successul companies, strategy is typically developed bycommittees chock ull o company insiders without input rom the marketplace. At someo these industry laggards, a nance-driven approach is used where a slew o MBA-typescrunch numbers all day and dictate what happens at the strategic level o the business.At other organizations, strategy is dreamed up in the vacuum o a conerence room bywell meaning C-level executives who base decisions on instinct and prejudice and stuthat worked well in the past. However i the C-suite is not taking proper input rom the

business-unit-level product managers, then their eorts to steer the ship oten end uphitting icebergs. For example, how many mergers help solve market problems?

Intuit is a company thats illustrative o how a distributed leadership strategy developedrom the business unit and product management level is most likely to succeed. SteveBennett joined Intuit in January 2000 as the companys President and Chie ExecutiveOcer. The companys initial growth period was a big success because early on, Intuitsounder Scott Cook, did an excellent job o identiying an untapped market problem andproduced Quicken. Under Bennetts leadership, the company organized bottom up with a

leadership culture that develops and ensures that outside-in processes are in place.

#4

66% o technology

companies view the roleo product management

as strategic and 52% have

either product managers

or business unit managers

reporting directly to the

CEO those that did weretwice as likely to be leaders.

Pragmatic Marketing

& SoftwareMinds surveys (2003-2006)


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A key aspect was to instill an innovation program that pushed responsibility down togeneral managers and product managers or the total use experience, Bennett says.We created general managers or business units that are ocused on horizontal problemareas like consumer tax and gave them ull control over development and marketing orthat business segment. It is important that the business units werent product groups butproblem-ocused groups.

Bennett says that he works with the business units by conducting in depth strategy andoperational reviews that look at three perspectives. How well does each business unit:

Addressthetotalcustomerexperience?

Understandbuyingprocessanddecisions?

Manageoperationalprocessandproductresults?

According to Bennett, Intuit is doing very well. Currently, the company is at $2 billionin revenue and growing at 10% year-over-year and has consistently met or exceededprojections since its inception. With a $9 billion market cap and 26 P/E ratio, Intuit isbest-in-class. He attributes the organization around business units and the ocus onunderstanding customer problems with the companys ability to grow beyond its initialsuccess with Quicken.

A key aspect was to instill an innovation program that pushed

responsibility down to general managers and product managers

or the total use experience.

Steve Bennett

President and Chief Executive Officer

Intuit


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Each business unit has its own development, product management and some dedicatedmarketing with corporate teams supporting them, Bennett says. The power base is withthe business units and is responsible or driving the business because they own the strategyo oering and optimization o delivery all the way to customer. At the business-unit-level,we are constantly monitoring whats going on in the marketplace and what problems ourcustomers have. We are not big on ocus groups or quantitative surveys, instead we workby observation and testing innovative solutions.

Bennett says the company is not really interested in competitive or technology vectorsas measurement tools but interested in how much new value can be created orcustomers. The business unit managers own the go-to-market strategy but they cantexecute without the marketing team, he says. We havent developed any big brandingor corporate promotion programs to get in the way o getting solutions in the hands o

customers that need them. Thereore, we ask the business unit managers to lead thelaunch o oerings to the market.

What Steve Bennett o Intuit and other companies creating a distributed leadership thatocuses strategy down to the business-unit-level ensure is that company strategy is drivenby market requirements, not inside-thinking. It is critical to ocus an organization sothat outside-in processes are in place.


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#4Puzzle palace decision making

Just because you got promoted to be part o the executive team and get paid a lot omoney doesnt make you smarter than everyone else. In a typical scenario that weoten see, the strategic team goes o on a retreat where everyone brings pet ideas.The person with either the loudest voice or the biggest title usually wins. Usually,product management people who are invited to the meeting might interject and describewhat the market needs based on in-depth interviews, but they are typically shot downby executives who say something like, We dont have time or all that analysis, thecompetition is eating our lunch. As time presses, the group eels the need to comeback with a new action plan so the market research phase is cut short. The minute

you stop listening and start ponticating, youre guessing. And when you guess,chances o success diminish signicantly.


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Stop Being a VendorIn our experience working with thousands o technology companies, weve watched asequential decline each year in the level o trust between vendors and customers. Wevelearned that the most successul organizations are ones their customers view as trustedadvisors. Importantly, the way they get there is to ensure all o their customer-acingunctions embrace the discipline o being a problem-solver and solution-seller instead o asa vendor. Industry leaders dont push solutions at their customers and walk away. Instead,

they develop programs to partner with their customers in the process ocontinuous problem solving.

As a result, market-driven leaders today garner customer satisaction rates,

renewal rates and things like NetPromoter Scores in the 50-80% range.Those that are not, generate scores in the 5-10% range.[4] How do they dothis? A ormal customer relations program is the rst step. The best programsinclude both electronic and personal contact management, early access toproducts, loyalty programs such as preerred licensing terms, namedsupport sta, escalation paths or resolving conficts, and customer advisorycouncils and conerences. The second step is to develop a proessionaland responsive sales organization (or channel partners) that provide addedvalue in the sales and service processes. Importantly, industry leaders

employ a sales organization that is compensated both to sell to andretain current customers.

#5

In Getting it Done, Roger Fisher relates

a story about a railroad expert beingsummoned because a brand new diesel

locomotive would not start, no matter

what the engineer did. Ater a short time o

studying, the expert gave the locomotive

a tap with a hammer and it started right

up. Although very appreciative, railroad

executives were somewhat surprised to get

a bill or $1,000 and asked the expert toitemize it. The reply came back in two lines:

Hittingthelocomotivewith

a hammer ($10)

Knowingwheretohitit($990)

[4] http://www.netpromoter.com/calculate/nps.php
http://www.netpromoter.com/calculate/nps.phphttp://www.netpromoter.com/calculate/nps.php


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Jim Malcolm, ounder and CEO o AccuMap EnerData Corp. garnered 90% market share orthe companys inormation service targeted to proessionals who work in the Canadian oilindustry. At the time Malcolm sold the company in 1998, investors were rewarded with a6,000% return on their investment. Malcolm credits his success to three things: hiring great

people, empowering them to build the products people want to buy, and maintaining acustomer ocus as a trusted advisor instead o a vendor.

We developed AccuMap, a PC-based product, with the map o western Canada(the countrys oil producing region) being what the user saw, Malcolm says.Imagine turning on your computer and theres a map o the oil producingregions with all the rivers, roads, lakes, pipelines, gas wells, oil wells, and muchmore. Malcolm says that his customer ocus as a trusted advisor allowed himto build AccuMap into the industry-leading product. We didnt take customers

rom A to Q like the other big competitors did, he says. Instead, we tookthem rom A to B to C. Our system ollowed all the steps they were used to intheir hard-copy world, we just did them quicker and more elegantly. We won

peoples business because we listened and they know we listened. Ater a trade show wedhave close to a thousand written documents o suggestions and wed take weeks and readthem and categorize the ideas and look or trends o similar thinking that intuitively madesense. When we ound them we implemented them.

Unlike many companies that we spoke with, Malcolm didnt just collect a bunch o ideasand sit on them. AccuMap actually used the inormation to create products people wantto buy. Its signicant that or the rst ve years o our companys existence, everytime we released new data (which was monthly) we also released a new revision o oursotware with new product eatures, he says. This meant that good ideas rom usersmight appear in our sotware within days o them suggesting the idea. This fabbergastedour users and, o course, gave them an incentive to share their great ideas. People becameso enthused with our responsiveness that they responded, sometimes writing lengthydocuments o elaborate suggested improvements. Good stu. Contrast this with the normalrelease cycle o a standard sotware company that might release a new version yearly orevery couple o years. Ater ive years, our user base was so large and the suggestions

so vast that it became impractical to maintain the pace and we moved to quarterlyreleases o new sotware.

We won peoples business because we

listened and they know we listened.

Jim Malcolm

founder and CEOAccuMap EnerData Corp.


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Malcolm says that the companys trusted advisor ocus also worked as a sales strategy.Wed go to a potential customer and demonstrate the product, he says. When they askedhow much it would cost, we would say we would install it or ree or a month and letthem use it. I at the end o the month they didnt believe it made their lie easier, they

could return the product and keep all the maps theyd produced or ree. Sometimes, evenwith this pitch they would say to me, No, your product isnt ready yet, because I needX eature or Y data type. We would say excellent. There would be no sales tactic at thispoint except to request a urther meeting with them when we had such eature or data.They respected the act that we didnt try to convince them to take our product because weperceived that we had other eatures that they didnt value at that moment. When we addedthe desired eature we would then go back to them and invariably make the sale. Ouractions were actions o respecting the prospect, the potential customer. But an importantaspect o this strategy is that Malcolm reused to build enhancements when requested by

a ew large customers, even when they oered to pay hundreds o thousands o dollars todo so. I only built an enhancement when it could be utilized by a wide number o usersbecause it made sense or the entire industry, he says.

As the company got bigger, Malcolm realized that a great trusted advisor program would beto create his own tradeshow to bring large numbers o people rom the industry together todiscuss issues. O course, this eort also branded the company as a very important playerin the marketplace. We could get more people at our own tradeshow than the industry

association could get to their tradeshows, he says. We would get 1,000 people at our

conerences when we were showing new eatures. Wed bring in guest lecturers oninteresting topics and wed bake bread on the premises (who doesnt love the smell oresh baking bread and that olactory experience would get attached to my sotware).It was all about taking our culture o honesty, integrity and doing everything or theright reason and taking that culture to the streets.


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One o the most ascinating results o Malcolms ocus on being a trusted advisor was thatAccuMap oten brought together people rom dierent departments at client companies.Historically, all o our competitors would build a system or geologists, or or engineers,or or land personnel, he says. O course this just reinorced poor communication

among these disciplines. The geologists used geological systems and the engineers usedengineering systems. We developed our system modularly so that the same base systemcould have a land component plugged in, or an engineering component plugged in or ageological component plugged in. Because the system was so easy to learn, the geologistsstarted to look at land issues and the land guys started to dabble in engineering questions.Instead o creating euds, this broke down the miscommunications and promotedteamwork. This also meant I could sell AccuMap into multiple places within a singlecompany such as the land department, the geology department, and the engineering

department. So i I lost a sale in the geology department, Id go

down the hall and sell to the land department. This meant Icould get a beachhead o internal champions somewherein most companies and this gave me a calling card tocontinue to be in that company.

When Malcolm sold the company in 1998, there were more than500 companies using AccuMap with 6,000 users. I I lost sixcustomers a year I would really study why we lost those customerswhy had they lost aith in us? We would ask, what does it take to

get your business back?

I I lost six customers a year I would really

study why we lost those customers

why had they lost aith in us? We would

ask, what does it take to get your

business back?

Jim Malcolmfounder and CEOAccuMap EnerData Corp.


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#5 Missionary sellingIn many technology companies, we see a situation where a new product is ready or launch and

company insiders want to create a splash. So they bring in a new high-powered agency andoten deploy a new sales orce to come up with creative ways to reach millions. Everyone insidethe company gets excited about the opportunity and the creative types come up with a strategythat breaks the mold and will cut through the clutter. Even though it is a huge nancialcommitment and the CEO is skeptical, time pressures mean a decision needs to be made. Thecampaign is approved. And other than some internal anare, nothing much happens, exceptthat the ace you present to your customer is inexorably shaped by cleverness vs. the realvalue that trusted advisors and solution sellers bring.


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Marketing with a Big M

Industry leaders understand that marketing is more than just marcom (marketingcommunications) and that the role o marketing involves much more than justcreating a message and delivering that message with the tools o advertisingand public relations.

Unortunately, in many less successul organizations, the promotional aspects o marketingare all that really occurs. Companies are more likely to ail when they get busy doingwhat they think is marketing without rst going out into the market to understand whatproducts people want to buy. Companies get into trouble when they throw bucketuls

o money at the promotional aspects o marketing such as advertising, tradeshows, PR,media relations, analyst relations, and the like without paying due attention to the problemidentication, market denition, and product management aspects o marketing.

Successul companies understand that marketing is not just promotion and advertising.Industry leaders ocus rst on the marketplace and identiying market problems thatexist and that can be solved with technology. These industry leaders organize aroundboth inbound marketing (understanding market problems and buyers) as well as what ismore traditionally dened as marketing, the outbound components including the creationo a go-to-market strategy.

Weve dubbed this success actor o industry leaders Marketing with a Big M.The dierence between just marketing and Marketing is a ocus on marketing asthe undamental driver o a business.

#6

Marketing is too important

to be let to the marketing

people.

David Packard

co-founder of

Hewlett-Packard Company


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We started in late 1989 at about the time that Microsot launched Windows, says MatthewRizai, who as CEO o Engineering Animation Inc. built a highly proitable technologycompany with sales over $100 million and 1,100 employees worldwide. EAI producedanimation and visualization sotware, growing very quickly in the 1990s leading to a

successul IPO in 1996. That was also the time that Terminator came out as one o theirst movies that used computerized animation technologies and 3D visualization. Westarted looking at visualization technologies to igure out how to make things moreproductive or dierent jobs. Rizai and his colleagues irst went to Hollywood to seei they could sell a product or use in the movie business, but quickly ound that it wouldbe too dicult. So they needed to identiy another market.

Some o us in the company had trial experience so we looked at courtroom and trial useo our sotware or accident reconstruction, he says. That was the rst market. We went

to the attorneys and we told them that we could do Terminator style graphics or lawyers.Although we looked or the need in the market with trial lawyers, we had the expertise toknow that the product made sense. For the trial lawyer market, Rizai identied a marketproblem: How can a lawyer show a judge and jury what happened during an accident ina compelling manner? By interviewing lawyers to understand the market problem and theproduct required to solve the problem, EAI developed an ideal product that sold in the$50,000 price range.

Through this process o problem identication and understanding what product people

wanted to buy, Rizai was doingM

arketing with a BigM

. The company didnt just tossout a product that they dreamed up in a conerence room and relied on promotionsand advertising to create a need. Rather, EAI used marketing tools to identiy a marketproblem (the diculty o showing a jury in a courtroom how an accident occurred)and build a visualization product that a dened market (trial lawyers) were willing topay money to solve.

M1


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EAI then went to work to identiy other people who had market problems that could besolved by the companys technology. Since people were doing this visualization stuor cars and movies, why not humans? Rizai wondered. So he decided to investigate thepotential or 3D visualization in the medical area. But we did not know anything about

the medical business, so we made some calls to the Mayo Clinic and ound someone whobecame very interested in our ideas and became a partner, he says. We went togetherwith our Mayo Clinic partner to the Department o Commerce and ended up getting agrant to und the product development. What we realized internally was that technologyis not everything and that we needed to start ocusing on understanding the needs o ourpotential customers, to understand what they required. In this sort o research, there wasno selling, it was just data gathering to gure out what people needed. Our strategy wasdeveloped by talking to potential customers and people in potential industries in a non-threatening way to nd out what problems they had that we could solve.

According to Rizai, once EAI gured out the company had products thatthe market wanted to buy, they created an environment to duplicatesuccess. We went to aerospace companies, auto companies, and heavyequipment manuacturers. As I see it these are the required steps: 1)Understand market needs 2) Develop a product strategy and 3) Create amarketing, distribution and sales strategy. Rizais three steps are exactlywhat we call Marketing with a Big M.

...What we realized internally was

that technology is not everything

and that we needed to start ocusing

on understanding the needs o our

potential customers, to understand

what they required...

Matthew Rizai

CEO of Engineering Animation Inc.


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OK, so we learned how EAI developed products based on market problems, but whatabout outbound marketing? How did the company get the product in ront o potentialcustomers? The target market was enterprise-wide, corporate, Rizai says. So we goto dierent job unctions like the head o engineering, the CFO, and sometimes the

president o the company. But these guys can be conservative. So our go-to-marketstrategy was ocusing on a ew customers to give us the success stories that we canthen use to scale up. The challenge was the need to pick the right companies to targetand then tailor a presentation to each company. The proo-o-concept benets o telling

a story about a new customer is critical or success in the rest o the market. Ourgo-to-market approach always included trying to get one great customer in each

target market beore we go ater the entire market. Getting the highest qualityreerence possible is critical.

By every measure, Rizai as a CEO and his company EAI was a success.BusinessWeek magazine recognized Rizai as one o the best entrepreneurso 1997, and Forbes ASAP recognized EAI as number 8 on its list o the100 most dynamic technology companies in the US in 1998. We askedRizai what it takes to make a successul technology company. At all

stagesrom startup through going public and the growthstagewe were constantly developing product or newmarkets, Rizai says. We did not have much experiencewith steady state.


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Seduced by branding and award-winning campaigns

The average tenure o a Chie Marketing Ocer is less than two years. [5] Why so short?In a typical scenario, the well-meaning CMO identies that something needs to be xedin the rst six months. For many CMOs (especially those with a consumer marketingbackground) the answer is to spend much o the next year re-branding (ddling withoutward maniestations o the company such as logos, the color scheme o the web site,image ads, and tchotchkes) all at the expense o the market and what they need to know.Ater a year when nothing has undamentally changed (except millions o dollars spent),the organizational antibodies rise up against the hapless CMO and he or she is suddenlyout o a job within 90 days.

[5] 2004, Spencer Stuart, Blue Paper CMO tenure: Slowing down the revolving door.http://content.spencerstuart.com/sswebsite/pd/lib/CMO_brochureU1.pd
http://content.spencerstuart.com/sswebsite/pdf/lib/CMO_brochureU1.pdfhttp://content.spencerstuart.com/sswebsite/pdf/lib/CMO_brochureU1.pdf


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Measure only what MattersMeasurement is a tricky thing or most companies, but not market-driven leaders. Successulcompanies dont all prey to the typical requirements o the C-suite, investors, boards,industry analysts, and Wall Street or managing the minutia and death by metrics. Ocourse, nobody would argue that data and metrics dont have value, particularly when thenumbers provide visibility and transparency into company perormance. The problem withmeasuring marketing activities is that too many companies have trained their employeesto measure the wrong things. At the typical technology company, unctional line managersdeliver detailed metrics on such things as the number o sales leads, the number oPR hits (magazine and newspaper articles that mention the company), engineeringproductivity rates and waterall charts, regional sales perormance and more. Well, guess

what? Those things dont matter and only serve to create a management environment thatworks hard but not smart!

Market-driven leaders measure only what matters. Their C-suite needs are dominatedby demands or real measurements that help them run the business. When done right,the measurement will not just be a way to dole out MBO bonuses, but will serve asthe dashboard or how the company is run. Metrics will help answer questions suchas: Should you increase spending to build new and innovative products? Shouldyou expand your marketing programs? Develop new channels? Increase or decrease

your marketing sta?

#7

At the end o the day,

customer satisaction, unit

sales growth and proftability

are the only metrics

that matter.

Paraphrased from every

successful CEO we interviewed.


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During our discussions with (and surveys o) people in thousands o companies, the biggesteye-opener or us was the way CEOs measured the impact o the companys operatingmissions on the success or ailure o the business. Things like the:

Cost in dollars as well as the opportunity cost of

getting the product right:how much faster can you bringa new product to market and how much money can be saved by

eliminating development mistakes?

Opportunity cost and P&L upside of eliminating

thrashing on the front lines: how can we lower overall

costs of sales and marketing by spending our dollars and resources

more wisely?

Fundamentals of the value of the business: what

impacts will this have on customer satisfaction rates, retention

and referrals?

Management of the people and culture

intangibles: will any of this improve margins, employee

productivity or retention rates?

We had a bunch o metrics to measure success, including the number o new customers,new seats in customers, average contract value o renewals, and a breakdown betweenregions o the world, says John B. Carrington, the ormer CEO o Websense, Inc. andwho now serves as executive chairman o the company. Since joining the company inMay 1999, Carrington has been the driving orce behind its nancial success includingthe Websense March 2000 IPO that raised more than $72 million and a customer basethat now includes more than 24.5 million users in the Employee Internet management(EIM) market. The company has grown rom a $30 million market capitalization to a$1.5 billion dollar market cap.

We had a bunch o metrics to measure

success, including the number o new

customers, new seats in customers,

average contract value o renewals,

and a breakdown between regions

o the world.

John B. Carrington

executive chairman and former CEO

Websense, Inc.


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Websense has a program to gather inormation about what the market wants to buy.As or developing new additions, when we went to the customer base, they wantedthings like a blue button or putting the cursor on the let which was not helpul,Carrington says. And Sales wanted to do what the competitors wanted. But thats not

helpul either. But drawing on positive input, Websense had an objective to developtwo new product add-ins per year.

According to Carrington, market share metrics are important in understanding where toocus the business. We had 75% to 80% o the market within companies that have 1,000or more employees, he says. We could scale to that level. Now Websense is trying tohead downscale to the small and medium-business markets because we saturated themarketplace o the bigger companies.

Carrington says that in the product development area, Websense relies on measuremento customer problems to guide them in the product development eort. We noticed thatemployees were wasting time surng the Internet, eBay, and other places while at work,he says. So we produced reports that showed that more than 50% o Internet use wasnon-business related. There was a huge market problem or our customers. So we startedto segment the categories o sites that employees visited. The measurements o employeeInternet use also ormed the core marketing messages and media hooks or that aspecto the Websense product oering.

Carrington says that the company uses systems such as SalesLogix and relies on dashboardsto manage the sales, company metrics, and the results o marketing programs. Early on,the average Websense customer was paying $15 per employee per year. Our goal was toget to $100 per employee at an average customer, he says. We eventually got to $92 onan annual subscription model. Having visibility into these kinds o measurements not onlyhelps to run the business, it also serves as a guide or outsiders. It also gave the publicmarket (including analysts and investors) a chance to see how we were going to increaserevenue, he says. Customers were used to paying a little extra or things, so the businessmodel worked well because our goal was add in modules to get more revenue.



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Scoreboard watching and analysis paralysis

Companies typically spend lots o money and time measuring the wrong things. Monthly, quarterly, andyearly meetings and periodic reports that take days to prepare and deliver, chock ull o metrics to presenthow well you are doing, arent that helpul in understanding the market. The problem is the metrics havebeen developed inside-out and they only serve to bore, conuse and provide data points to shoot downany hypothesis that starts with doing something dierent than the status-quo. They serve to create deerralsand no action until you can watch the scoreboard light up dierently the next time or come up with newmetrics so the game can be changed.


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The Power o Pragmatic Marketing

How do you know where you ft?Executives and sta at many companies already think they are market-driven. Hey, themission statement even says so! Yet, when we go into these organizations and actually

measure the things that people do all day, we inevitably hear about problemsand opportunities that originate as inside-out thinking (Apple Newton) vs. romthe outside-in (the buyers perspective which leads to breakthrough productslike the iPod). In other words, technology companies are increasingly ineective

because their eld and customer-acing organizations spend more time postulating and

ponticating around scenarios that support their oerings than listening and learning aboutproblems their customers actually have (and are willing to spend money to solve).

Our mantra:Your opinion, although interesting, is irrelevant!

When was the last time you bought your companys product?

What really matters is the buyers opinion. O course, each company will have dierent

measurements that matter and varied things o importance to manage the business. Butthere are some real measurements that may be used to assess how market-driven yourorganization is right now. We challenge you to objectively answer the ollowing questions.I you answer yes to all o them, congratulations youre market-driven!


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Do you meet your product delivery schedules?

Are your product requirements defined by the needs of the market?

Is the focus of your research and innovation on addressing an understood and well-defined market need?

Do you first look outside for new technologies before building them yourself?

Are product positioning and messages based on the specific quantified problems of a well-defined market and buyer?

Is the positioning statement done before development begins?

Can a customer or prospect understand the value to them of a product or feature by reading the first few lines ofany of your marketing deliverables (data sheets, brochures, fact sheets, etc.)?

Does your web site focus more on market problems, market segments, buyer personas, and solutions than on yourproducts, technology, and your company?

Do you have a marketing programs strategy?

When you have a meeting with a customer, do you spend the largest percentage of the time listening versus talking?

Does someone other than Sales routinely visit non-customers?

Do you have someone who is your chief prospect advocate?

Can an average salesperson quickly locate the right tools to present your product strategy or to close a deal?

Are your channels selling all of your products?

Is part of your marketing programs budget and sales goals allocated to customer satisfactionand customer retention?

Do you measure product profitability including estimating fixed costs on a pro-rated basis?

Do you retire non-performing products?

Market-driven companiescan answer and quantiythese questions. They workbetter, achieve results asterand have happier customersthat return their calls whensomeone wants to askthem what problem they canhelp them with next.

The ultimate measurementis product protability. I yound an urgent problem, cansolve it in an innovative wayand clearly communicate toyour buyers that you solvedthe problem, you eliminate

the cost o educating themarket and creating theneed. These costs are otenthe dierence betweenbeing protable or not.



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About Pragmatic Marketing

Pragmatic Marketing is not theory. It is an industry-proven methodologyor success at applying a market-driven model to managing and marketing

technology products. In this e-book we ocused on just a ew real-lie exampleso companies that are market-driven as well as companies that would like to be.We oer a undamentally dierent approach to technology-companyMarketing.The Pragmatic Marketing approach shows technology marketing executivesand managers how to identiy and design solutions or problems that potentialcustomers actually have; how to prioritize the issues; and how to create eectivemarketing programs that speak the customers language.

Although the concepts o becoming market-driven are simple and easy to

understand, the reality o implementing the ramework requires a undamentalshit in the way a company operates. Companies must eectively transitionrom one that works inside-out to one that delivers what the customer requiresby working outside-in. Given the striking dierences in success actors,the choice is simple.

We look orward to sharing more inormation with you in our hardcover bookdue out in mid-2008.

www.PragmaticMarketing.com
http://www.pragmaticmarketing.com/http://www.pragmaticmarketing.com/

secrets market driven leaders

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