Competition focus - Market Tracking

Competition is present in almost every aspect of our life. It is present whether we are developing solutions as part of service domain, developing products as a product company or offering services.

There are 3 different dimensions to competition. 1. Market. 2. Product 3. Customer. Hence Competition focus has several sub-sets to it. They are
1) Market Tracking
2) Competition Business Tracking
3) Competition Product tracking
4) Customer characteristics tracking

Competition is not just about an individual or organization vying to grab our business. Competition is all about learning and sharing the experiences to derive the maximum output from the market. Without competition substantial portions of the market will remain un-served.

Hence Competition is a vital part of any industry. Definitely competition decreases efficiency of the resource conversion by over exploiting of resources for the sake of profits. But it promotes effectiveness in reaching a product or service to a wider audience. Due to competition, vendors search not only for more profits, but also for newer market segments and newer set of customers. There is no other known mechanism in the world today that can drive product or service distribution to a wider set of people.

From a customer angle, competition gives the customer a choice in the availability of service. It gives the customer a confidence.

The issue is how our product or service is going to fare with respect to competition. It is easy to write eulogies on competition sitting in the cosy space of an office. It is rather difficult to feel the heat in the field when customers toss around products and services with the aim of optimizing their business. Not just product or service delivery, business methodologies, sales relationships, financial models all go into determining the outcome of competition.

Here is where Product Managers need to fight along with the sales. Product Managers are the mission control. They need to share the heat of the Sales teams and fight the competition together.

There is no defined methodology that I have seen till now to ensure victory in a competition. It is simply as they say, nothing succeeds like success. If we win, we may pat ourselves for our intelligence. But we may very well be rest assured that the same model may not work next time. It is very difficult to pin point what worked in a model and what did not.

The only way to fight competition is to fight vigorously but be prepared for accepting defeats. The only solution is to have sufficient sales funnel to manage the different outcomes. Still there are accounts which Sales and Product teams will be placing higher energies on and accounts where they place less. This may be planned or happens intuitively.

One way to fight competition effectively is to ensure that the energies being spent in different accounts are distributed optimally to ensure maximum success. To determine where to spend our energies we need to track the four parameters mentioned at the start of this post.

Market Tracking
Often people talk about the new Hare and tortoise story without understanding the real meaning of it. In the new story, Hare and tortoise run together and share each other’s strength and weakness to run the fastest possible run.

The real issue is not if they ran together or ran against each other. The real issue is they understood the market and their terrain better. They understood their market comprises of not only bushy lands, but also ponds and thorny patches. Hare understood while it is fastest in the bushy lands, the tortoise is fastest in ponds. In thorny patches, both are equally good or bad.

Whether they run together or not depends on how much ponds, bushy lands and thorny patches are there in the forest. More important it is about their perception of the forest that will determine if they want to run together or not.

Now, this is market tracking. Understanding what the market needs are, how the terrain is, how we are matched against the terrain and where our real strength lies is market tracking.

Market is a generic word that actually denotes a whole set of people. Like a forest that involves terrain, vegetation, environment and climate, a market involves customers, their needs, business/financial environment and regulatory/government environment.

Once I was asked “If you develop a product towards a customer, how can u address it to the entire market..? Should we not develop a product towards the market..?”. I answered them thus “Market is the aggregate of customers. If we are not able to focus and win in one customer place we are not going to win in the market at all. Hence we need to devise a product for a customer with overall market in the background of our mind”.

It is like the field of vision and our aim. As in the mythological story, Arjuna’s field of vision, when he took aim of his arrow at the distant fruit on a tree would be definitely covering the branches, leaves and the fig that held the fruit. But when asked by his guru, on what he is seeing, Arjuna replied that he does not recognize the branches or leaves or even the fruit. He said that he is recognizing only the fig of the fruit that holds it to the tree.

What he means in reality is that his mind has been able to establish a clear path between his arrow to the fig of the fruit that is uninterrupted by any branches or leaves, so that when he releases the arrow, it strikes the fig and fruit falls down. This does not mean that Arjuna did not see any other thing than the fig that held the fruit. If he had not seen all those branches and leaves, he would not have been able to establish this clear path for his bow.

Tracking several customers and aggregating them and their needs to a great extent is market tracking of customer needs. But this alone is not enough.

Market tracking also involves technology tracking, business/financial models tracking, regulatory and government environment tracking.

Most of the product managers or technology developers do not track technology. The best way to track technology evolution is to be part of the eco-system of technology development, be it at Integrated Chips, ASIC, Engineering concepts related to the field of operation, Software development/testing methods, processes, database evolutions, tools etc.

Of course it is difficult to track all of these technologies simultaneously. So the product managers need to determine which technology sectors affect them the most and make a conscious decision to track them by becoming part of the sector development, either through online or offline magazines and periodicals.

Tracking emerging business and financial models is much more difficult. In most products the models don’t change at all. In these cases, product managers can look at if there is any real improvement possible by slightly re-casting their current business models. They need to do it at appropriate levels.

The best way to track the changes, in businesses where models change, is by networking. Networking by Business Development, Sales and Product Managers to understand how the customer’s business and financials work and how it could be put to use for the advantage of our business deliveries needs to be worked out.

One of the critical thing required here is a periodic internal meeting and institutionalized knowledge sharing by BD, Sales and Product Management teams on market, business models and environment. It should be structured as a formal business interaction session. Iit should come out with action points for different teams. This would help largely in understanding the business and financial models of customers and improving them.

Regulatory and Government environment tracking is required only if there is a direct hit on the business from regulations or government policies. In such cases, is better to have a “Consultant Advisor” on organization’s rolls, paid a minimum for sharing information, but paid by the project if any needs to be executed and driven by BD. This also needs to be reviewed during the formal business interaction session. In case it is in-direct, there is not much tracking that is required, except those of reading magazines and newspapers.

In the next post, let me write about Competition Business Tracking..

-Balajee Rajaram