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Product management is a proxy for the business and the epicenter of impact in the organizations. They spend their time tapping market trends, discovering customer needs and use cases, competitively innovating, defining new market growth categories and strategies, designing product experiences, crafting offers and pricing, and ultimately launching and growing their solutions in market. Doing all this in as-a-service businesses can present new and renewed challenges. I call this the Business of Product Management, and it was a big focus for product management leaders at our recent Technology & Services World conference.
Unlike any other conference in the industry, Technology & Services World delivers 3 days and 120 sessions of information packed sessions on the pertinent Product, Sales and Service aspects of as-a-services solutions for business growth, scale, and profit. Based on attendee feedback, the October 2019 event in Las Vegas was a home run with the product management leaders and executives in attendance. In no particular order, here are a few of the highlights and takeaways.
In a packed session, Bill Noel, GVP of Offer Management at JDA Software, spoke about conquering XaaS portfolio life cycle management at scale. Showcasing JDA’s governance model, Bill noted that there’s a lot more on the shoulders of the cross-functional teams led by product management than ever before. The product management teams act as true “mini general managers of their solutions”. They literally work cross-organizationally and are responsible for driving their as-a-service solution to success.
They not only focus on revenue and market share growth, but also on the full 360 perspective monitoring margins, solution adoption, customer retention/attrition, and the partner ecosystems. They need to be intimate with the sales pipeline and the service delivery. They need to be completely tapped into the rhythms of the business, drive profitability of their offers, and gain alignment cross-organizationally.
The corporate leadership has high expectations of these product management leaders and individuals, and provides the necessary support to empower them and help them with effective team management skills.
Key learnings from this session include:
TSIA’s XaaS Product Management research practice members can access Bill’s presentation here.
In a session entitled, “XaaS Metrics that Matter for Product Management: What’s on Your Dashboard?”, Tracy Laird, Senior Director, Product Management and Jamie Kulig, Senior Manager, Product Management, ServiceNow discuss the importance for product management to keep focus on product success and adoption in market. ServiceNow is a multibillion-dollar SaaS business that’s growing at over 36% YoY and can certainly present challenges to drive efficiency at scale.
In XaaS, it’s critical to keep focus on what really matters to product success in the market—specifically product adoption, enablement of the customer success at scale, and ensuring customer influence on the product roadmap. ServiceNow shared their journey of evolution to enable this operational scale, from multiple one-off efforts to creating focused dashboards and systems that drive alignment and outcomes.
Key lessons in establishing these 360 integrated and unified dashboards include: early executive sponsorship, clear ownership and accountabilities, a culture of cross organizational collaboration and efficiently managing dependencies.
TSIA’s XaaS Product Management research practice members can access the Tracy and Jamie’s presentation here.
The partnership between Amy Bunszel, SVP Design and Creation Products at Carl White, VP Revenue Models at Autodesk is a powerful one. In the session entitled “Transition to XaaS Business Model: Everything We Wish We Knew Before We Started and Then Some,” they shared their successful multi-year journey from all on-prem software perpetually licensed to 96% cloud-enabled recurring revenue, including the key lessons learned along the way.
Their “go faster than you think you can” transition message was reinforced in J.B. Wood’s keynote, where he showed the market caps of companies that are moving in the transition slowly—not a pretty picture. Conversely, those companies that align on a plan to transform, announce that plan to the market, and demonstrate progress on the key target metrics, are seeing significant market cap growth. Case in point, Autodesk’s stock has grown 226% in the 5 years prior to July 2019.
Watch Amy and Carl’s complete keynote here in this video.
Joe Sharritts, SVP Americas at Cisco, sat down with J.B. Wood to discuss the insights from the business model transformation that Cisco is going through. Joe discusses the need to do a better job of understanding the customer’s business and the necessity to proactively guide the customer to realize the business value and outcomes from their purchases and the need for alignment (driven from the markets and your customers) across all organizations helping teams understand the sources of change. Businesses must build the right offers combining products services and telemetry in order to be effective. The success of business model transformation is depends in part on individual motivation to evolve, change, and work on soft skills.
For the full fireside chat with even more insights on the model transformation between Joe and J.B., watch the video here.
A session hosted by Martin Dove, VP Research, Subscription Sales and myself, VP Research, XaaS Product Management involved about 12 company leaders coming together to discuss how product management and sales can and should effectively work together in the as-a-service paradigm and the related emerging best practices.
Offer-market-sales fit was defined as the optimal match of target customer segments as well as the value proposition of the supplier’s offers and supplier’s accessibility of the target buyers. In other words, the success of a product offer that’s designed and developed to meet the needs of a target customer will only be successful if another element is in place—the sales team’s ability to consistently and repeatedly reach that target customer via direct sale teams, channel distribution , e-commerce, etc. Active collaboration between product and offer management and sales leaders is essential to success.
The group sharing was very enlightening on challenges faced on both sides in managing the transition to consumption-based offers without killing the traditional high-margin revenue streams in the transition process. One company discussed driving the attached services to their channel partners while another shared how they are breaking down the internal organizational silos to address the demands of the consumption value proposition. All agreed on the need to have a solid customer journey mapped out to evolve to a supplier-led sales model. Starting small and iterating was the group conclusion.
All left the session exchanging business cards and commitment to continue to share and learn from each other.
In as-a-services offers, the first sale is just the opportunity to deliver value and grow the customer relationship. Traditionally, marketing spends the majority of their budget on landing sales with new customers. Now, marketing is inclined to dedicate budgets for post-sale activities nurturing customers and supporting service efforts to drive adoption. The marketing-services handshake becomes particularly important in delivering “moments of value” with focus on the “persona journey” vs. the generic form of “customer journey”. Effectively achieving success of these efforts’ mandates alignment across all functions.
Contacts are the digital fuel of the marketing engine. Once the initial sale is complete the services teams are engaging with ten time more contacts than before the initial sale. These services qualified leads (SQLs) are golden for the marketing nurture campaigns and services teams stand to gain a lot of credit for driving the revenue pipeline.
For the full keynote on “Marketing as-a-Service” by Elizabeth Zornes, CCO of Zendesk, you can watch the full session here.
Thomas Lah, the Executive Director of TSIA, closed the conference with sharing key industry data that discusses some of the reasons that companies don’t change or that change too slowly towards value delivery and as-a-service go to market models. The willingness and/or the ability to change eludes some companies even in the face of the tsunami of transformational trends that threaten to overtake them and render them irrelevant. A real-time audience poll proved this point. Thomas made the case for making some big moves and offered a prescriptive formula for just that.
Thomas also shared the pivot in mentality that’s taking root in the tech industry, most notably by the Business Roundtable, a prominent group of companies, including many TSIA member companies, that have pledged to deliver value beyond the shareholders, to all these newly-identified stakeholder groups -customers, employees, suppliers, communities and long-term shareholders for the future success of the company, communities and country.
With a double-click into the private equity models in the industry, Thomas explains that business model transformation is more likely to occur without private equity involvement. He demonstrates through models and industry examples, where the industry is seeing real successes. He offers a tangible evaluation checklist for health of the business model transformation, and provides a call to action for individuals regardless of where they sit in the organization. Compelling stuff! For the full presentation with even more insights on the model transformation, watch the video here.
There were so many great conversations fueled by the content that was presented from all mentioned above in addition to great speakers and insights from, Amazon Web Services, Autodesk, Axway, JDA Software, ServiceNow, and TSIA. I could go on. As one of the many great session hosts, I am very grateful and humbled by the community that gathered and the sharing that resulted. The post-conference feedback from the executives in attendance was quite gratifying including quotes like:
So, when is the next Technology & Services World event you ask? Well, we get to do this again May 4-6, 2020 in San Diego. Come join the conversation and stay current on the latest trends impacting the business of product management!
Post Date: December 5, 2019
Laura Fay is the vice president and managing director of offers research and advisory for TSIA. She also serves as TSIA’s vice president of XaaS product management research. Laura is a technology industry veteran with over 30 years' experience driving business growth in the enterprise technology industry via leadership roles in product management, general management, product development, and customer success.
The Technology & Services Industry Association (TSIA) is dedicated to helping technology and services organizations large and small grow and advance in the technology industry. Find out how you can achieve success, too. Call us at (858) 674-5491 or we can call you.