Operational Relevance:A Mandate for High-Tech Marketers                      THE TECH MARKETER’S ROLE IN           C R E A...
Agenda                             2 What is “operational relevance”? 3 examples: Product Development, Sales, and Servic...
Hypothesis                  3Marketing needs to achieve operational relevance in order for the company to realize the str...
Is Your Marketing Team Operationally Relevant?                                                           4    What’s the ...
What is “Market-driven”?                               5 “Companies that are not market-driven believe the role of  Marke...
Strategic Relevance…         6
… Paves the Way for Operational Relevance…                              7      Strategy without Operations is “tooth-less...
Agenda                             8 What is “operational relevance”? 3 examples: Product Development, Sales, and Servic...
… But Needs to be Founded in Fact,                  not Opinion/Experience                                      9A. What s...
A. Product Development Operations         PRP: Product Release Proposals         NPI: New Product Introductions           ...
Traditional Product Management                                        11                Product   Market      Fragmented ...
Portfolio Product Management                                   12                                           SALES &       ...
Scorecard for Marketing Relevance in Product Dev Ops                                          13 Allocating R&D resources...
B. Sales Operations                                                                            14                         ...
Scorecard for Marketing Relevance in Sales Ops                                     15 Harmonizing marketing and sales eff...
C. Client Services Operations                                        16 “Client Leadership Team”   Goals:      Maximize...
Scorecard for Marketing Relevance in Client Service Ops                                                     17 Sensitivit...
Practice Sound Change Management                    18 Awareness Desire Knowledge Ability Reinforcement
Agenda                            19 What is “operational relevance”? 3 examples: Product Development, Sales, and Servic...
Payoffs                                         20 What matters most in company valuation?     PROFIT (OPERATING)     P...
Parting thoughts…                        211. Data sets you free2. Think cross-functionally3. Be ready to manage change
Thank you!                         22Keep in touch! mvigoroso2011@kellogg.northwestern.edu www.linkedin.com/in/markvigor...
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Operational Relevance: A Mandate for High-Tech Marketers

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Marketing needs to achieve operational relevance in order for the company to realize the strategic and financial benefits of being a “market-driven” firm.

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Operational Relevance: A Mandate for High-Tech Marketers

  1. 1. Operational Relevance:A Mandate for High-Tech Marketers THE TECH MARKETER’S ROLE IN C R E AT I N G T H E “ M A R K E T - D R I V E N ” F I R M Mark W. Vigoroso SVP, Global Marketing & Alliances Servigistics, Inc.
  2. 2. Agenda 2 What is “operational relevance”? 3 examples: Product Development, Sales, and Service Ops Payoffs
  3. 3. Hypothesis 3Marketing needs to achieve operational relevance in order for the company to realize the strategic and financial benefits of being a “market-driven” firm.
  4. 4. Is Your Marketing Team Operationally Relevant? 4  What’s the subject of most inquiries you get from other functions in the company? Strategic Operational Irrelevance Relevance Relevance How do we coordinate Latest report Where are Which product lines Which of our sales and marketing teamsOrder from an analyst the sales should we grow vs. clients are most and systems to eliminatelunch? firm leads? run for cash? profitable? pipeline leakage?“Pretty up” a Logo’d swag to Which Which indirect How should we How should wepowerpoint bring to a client emerging sales channels organize and allocate R&Dpresentation meeting markets will deliver the incent our sales capacity? deserve our fastest time-to- and services Tradeshow investment? value for us? teams to achieve booth duty client expansion targets?
  5. 5. What is “Market-driven”? 5 “Companies that are not market-driven believe the role of Marketing is to create the need for their products. You can see this in their behavior. Marketing is where t-shirts and coffee mugs come from. Marketing is the department that runs advertising. Marketing is the department that generates leads. Most of all, Marketing supports the sales effort. But mature companies realize the aim of marketing is to make selling superfluous. Marketing defines products based on what the market wants to buy.”
  6. 6. Strategic Relevance… 6
  7. 7. … Paves the Way for Operational Relevance… 7  Strategy without Operations is “tooth-less” Strategy OperationsWhat should we build?  R&D / ProductHow and to whom should we Developmentsell it?  Sales OperationsHow do we earn the right tokeep selling it?  Client Services / Support  Just get a seat at the table. Don’t try to OWN it.  Think/act cross-functionally
  8. 8. Agenda 8 What is “operational relevance”? 3 examples: Product Development, Sales, and Service Ops Payoffs
  9. 9. … But Needs to be Founded in Fact, not Opinion/Experience 9A. What should we B. How and to whom C. How do we earn the build? should we sell it? right to keep selling• Segment/region/ • Segment prominence it? product line by region • Client sat / NPS momentum via TTM • Competitive • White space analysis and E(FTM) revenues momentum • Account mapping• Current / future • Market sizes product competency • Market growth rates relative to competition • Installed-based sellability • Win/Loss • Pipeline stage conversion rates
  10. 10. A. Product Development Operations PRP: Product Release Proposals NPI: New Product Introductions 10 Product Mgt A Product Release Sales Defined QM2 Scope Frozen QM3 Code Complete Product QA Stable Mgt B Build & Smoke Test QM4 Beta Ready automated testing to Portfolio Council drive continuous quality QM5 COO QA Complete Execs G/A Ready Product NPI / CBA CMO BRD Mgt C CTO Sprint 1 PRP VP, Prod Mgt Sprint 2 Alpha Beta Sprint Sprint Client Program Mgt Release PlanCommunity Finance Beta General Release Release Product Mgt D Cycle Reviews Build & Smoke Test QM1 periodic reviews of work-in- automated testing to Tech Requirements Due progress features drive continuous qualitySupport QM0 Product Mgt E ProServices Portfolio / Platform Mgt
  11. 11. Traditional Product Management 11 Product Market  Fragmented value Strategy / Competitive / Win-loss propositions Plans Product Product 1 Analysis & Priorities Analysis Roadmap  Difficult to differentiateCorporate Product Market  No game-changersProduct Competitive / Product Plans Goals & Analysis Win-loss Strategy / & Priorities 2 Analysis RoadmapObjectives  Biased views of the same markets  Redundancies & conflicting goals Competitive / Product Product Market Win-loss Strategy / Product Plans Analysis & Priorities 3 Analysis Roadmap  Competition for resources
  12. 12. Portfolio Product Management 12 SALES & Segment 1 Dynamics MARKETING High-Value Solutions PRIORITIES Short Term RevenueCorporate Segment 2 Product 3 Product 1 Goals & DynamicsObjectives Product 2 PORTFOLIO INVESTMENT Segment 3 Dynamics PRIORITIES Longer Term Growth
  13. 13. Scorecard for Marketing Relevance in Product Dev Ops 13 Allocating R&D resources towards building products the market wants to buy should result in portfolio REVENUE and PROFIT growth. KPI Baseline Target Actual Product 1 direct contribution margin (DCM) Product 1 share of target markets Product 2 direct contribution margin (DCM) Product 2 share of target markets Product 3 direct contribution margin (DCM) Product 3 share of target markets
  14. 14. B. Sales Operations 14 Consumer High Medical & Motor For 2012 planning, the Portfolio A&D Industrial Utilities Elec&Appl Tech Scientific Vehicles Prioritization tool contemplates the 118% 91% 161% 87% 91% 101% 44% following inputs by product line…:SK/SC 124% 47% 36% 194% 209% 183% 121% 18% • TTM FinancialsCC 92% 70% 108% 144% 103% 54% 60% 39% • E(FTM) FinancialsSPM 136% 155% 40% 355% 191% 80% 159% 8% • Market sizesFS 96% 0% 56% 201% 189% 85% 31% 41% • Market growth ratesSPP 82% 0% 72% 172% 0% 0% 349% 0%SL 99% 0% 116% 412% 166% 58% 0% 0% • Competitive threatsWTY 72% 11% 8% 203% 121% 51% 103% 80% • Installed-based sellabilityAverage Score: 100% …And provides fact-based and market- driven guidance for industry segment,SPM 54.82% 9.13% 21.12% 19.49% 15.68% 19.36% 4.18% region, and product line bookingsSPP 0.00% 16.59% 10.23% 0.00% 0.00% 42.35% 0.00%FS 0.00% 12.90% 11.94% 19.28% 16.62% 3.80% 22.13% targets.SK/SC 16.68% 8.33% 11.57% 21.36% 35.79% 14.73% 9.53%SL 0.00% 26.51% 24.54% 16.99% 11.39% 0.00% 0.00%CC 24.64% 24.61% 8.54% 10.51% 10.57% 7.25% 21.12%WTY 3.86% 1.93% 12.05% 12.36% 9.94% 12.50% 43.04% Translation?  Paths of least resistance to achieving top-line targets: • Shorter sales cycles • Higher win rates
  15. 15. Scorecard for Marketing Relevance in Sales Ops 15 Harmonizing marketing and sales efforts should result in increased sales VELOCITY and EFFICIENCY. KPI Baseline Target Actual PQL/MQL Conversion Rate MQL/SQL Conversion Rate SQL/Promising Conversion Rate Promising/Upside Conversion Rate Upside/Commit Conversion Rate
  16. 16. C. Client Services Operations 16 “Client Leadership Team”  Goals:  Maximize Client Lifetime Value (CLV)  Revenue (i.e. SELL MORE SOFTWARE to our existing clients)  Profit (i.e. align our “care and feeding” investments with clients’ top- line contribution)  Grow referenceable base  Exec sponsors: COO, CMO • Client Services  Team members from: • Account Services  Finance  Sales • Pro Services  Marketing • BIS  R&D
  17. 17. Scorecard for Marketing Relevance in Client Service Ops 17 Sensitivity analysis on client sat data and prioritized plan for client expansion should result in highly profitable recurring revenue streams from “tier 1” clients. KPI Baseline Target Actual NPS by product, region, segment Cross-sell opportunity:close ratio, Tier 1 accounts Up-sell opportunity:close ratio, Tier 1 accounts Cross-sell opportunity:close ratio, Tier 2 accounts Up-sell opportunity:close ratio, Tier 2 accounts Average Annual Client Value (ACV), Tier 1 accounts Average Annual Client Value (ACV), Tier 2 accounts Average Client Lifetime Value (CLV), Tier 1 accounts Average Client Lifetime Value (CLV), Tier 2 accounts
  18. 18. Practice Sound Change Management 18 Awareness Desire Knowledge Ability Reinforcement
  19. 19. Agenda 19 What is “operational relevance”? 3 examples: Product Development, Sales, and Service Ops Payoffs
  20. 20. Payoffs 20 What matters most in company valuation?  PROFIT (OPERATING)  PROFIT GROWTH An operationally relevant marketing organization bridges the gap between the top-line-only incented sales organization and the often bottom-line-blind delivery and service organizations.  Source of operational cost is often not the best source for driving operational efficiency  Go-to-market strategy drives operational decisions and organizational structure  Operating profit is created and grown via selling the right product to the right companies in the right markets
  21. 21. Parting thoughts… 211. Data sets you free2. Think cross-functionally3. Be ready to manage change
  22. 22. Thank you! 22Keep in touch! mvigoroso2011@kellogg.northwestern.edu www.linkedin.com/in/markvigoroso @mvigoroso

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