We are deep in the trenches of 2024 planning. We are calling out our "Rocks" and OKRs, many of which include the launch of new products and services, or taking existing products and services into new markets.
Proceed with caution. Especially companies in the lower middle market ($5MM - $50MM in revenue), who have lean teams of Player/Coach leaders.
Taken to the extreme, a new product in a new market basically means you are launching a new company, complete with needing to re-establish product-market fit, messaging, and so on. That is a HARD task, and it is risky by its very nature.
\Common Planning Pitfalls
COMPANY PRIORITIES DON’T ALIGN AMONGST TEAMS OR RESOURCES
In theory, the process behind "Rocks" and OKRs is to align the organization on the work that is the highest priority with significant impact. Unfortunately, it almost never turns out that way, especially when launching new products/services or extending to new segments.
Why?
For starters, new products and/or markets typically means a new set of competitors as well. By definition, this will require different positioning, as well as targeting, distribution, and associated go to market motions. It can also mean some fundamental changes to business models for the company, above and beyond the GTM team itself.
As functional leaders, we tend to focus on the outputs of what we need/want to accomplish within a particular period. The only inputs we tend to consider are resources; people, tools and money to spend.
The most important and overlooked inputs are our knowledge of the buyer and confidence in our process of finding, developing and converting that buyer.
We often over-index on the activities; building lists, campaigns, emails, sequences, decks, call scripts, etc. because that is what we are supposed to do, right?
How can you set a target, goal, or metrics for these activities, if you don't even know who you're aiming for?
As a wise Go-to-Market guru once said …
Knowledge Inputs
Over time, our knowledge of the Buyer and their reason(s) for buying get distorted across the organization. Those that are new to the organization often rely on those who have tenure for insights on the market and Buyer, which results in perspectives that are opinions. Well informed opinions, but opinions nonetheless.
What further distorts our view of the Buyer is that there is no "average customer," yet entire plans and models are built around this mythical customer. In reality, our customer base is a portfolio of customer segments, each with different motivations and reasons for selecting (and sticking with) our product/service.
So before we start building Go-to-Market plans, it is critical to first assess whom we serve today, Segments, and the "Jobs" (as in Jobs to be Done) for the Buyers that hire our product and/or service to solve.
Segments
Segments are often confused with industries, but they aren't necessarily the same. A Segment is really the other side of the coin from the Job to be Done. It can be industry specific, especially for products/services built for specific industries, but can also be more closely tied to company dynamics.
Example: we serve mid-sized service-based companies that provide a solution to other businesses who serve commercial customers within a specified geographic region.
This could represent all kinds of "industries" (manufacturing, professional services, financial services, healthcare, etc.) but all share a common business dynamic.
So we need to review our current customer list and determine which segments we serve and how well we serve them, as evidenced by full funnel metrics; win rates, velocity, retention, expansion, etc.
How has this mix changed over time? Are we seeing growth or contraction from any segments?
Next, we must consider the market environment for each of those segments. Do they have wind in their sails or wind in their face, based on longer-term market trends? It's much easier to win in a river where the current is roaring vs one that is slow or stagnant.
Jobs
Ugh. Jobs to be Done. So powerful, yet so easily misunderstood.
The job plus the landscape of alternatives is indeed the basis for positioning.
One method we have found that helps to simplify the concept is to map out the end-to-end process your Customer has for the solution you provide.
Let's say you provide a software solution that helps companies assess potential candidates on a particular technical skill. Map out all the steps that precede that stage and what are all the steps afterwards.
What is my customer trying to accomplish by administering the assessment?
How do we determine who receives the assessment?
Is there a screening interview prior to the assessment?
If so, how are the interview questions determined?
How is the rubric for assessing answers to the questions determined?
Who writes the job description?
What is required to approve the job in the first place?
We just keep working ourselves all the way to the top and down to the bottom of the process. At that point, we have a much better understanding of how our customer views our solution, and all the potential alternatives (not necessarily direct competitors) that they consider.
The Bowling Alley
Once we have identified the Segments and Jobs we serve best (today, not in the future) we can begin to assess the Segments to which we want to expand and/or the Jobs our new product solves. The objective is to assess the GTM gaps we need to close, plus the amount of effort required to close those gaps, so that we can prioritize where to focus our efforts.
In Geoffrey Moore's classic book, "Crossing the Chasm," he introduces the concept of the "Bowling Alley" strategy for innovation. We have adapted this idea for Go-to-Market.
The first pin (Segment 1 / Job 1) is where we sit today. The next step is to expand to a new Segment OR a new Job. If we want to do both, then we are jumping to the third row (middle pin) which compounds the unknowns.
Successful Go-to-Market motions are reliant on a multitude of knowledge inputs, which can only be learned and/or validated by doing. The more repetitions the deeper our knowledge and greater our confidence of repeatability.
The further we move away from the first pin, the less we know about these key inputs. And the knowledge gap from row 2, to row 3, to row 4 is not linear, it's exponential!
The challenge here is that "depth of knowledge" is a hard thing to measure, so we need to work to make it objective. If we don't, we will quickly spiral into a war of opinions.
\PRIORITIES & ALIGNMENT
Getting revenue leaders to agree and commit on targeted Segments and Jobs is WAY easier said than done, so below are a couple of options to help you do that.
Segment/Job Assessment Rubric
By using a rubric, we can turn a qualitative, opinion-based decision into an objective, quantitative-based decision.
We provide a simple example below, using Segments (or Sectors) as an example. You can imagine something similar for "Jobs."
The assessment doesn't need to be complicated. Scoring can be as simple as low-medium-high or 1-2-3.
Sometimes there are so many unknowns it is difficult for the team to utilize a rubric to prioritize Segments or Jobs.
In these situations, an alternative method that we use frequently is the $10 bet.
The $10 Bet
This method works extremely well when you have multiple stakeholders, all with considerable market and institutional knowledge, where the consideration set is more abstract.
Each stakeholder gets $10 on which to "bet" on a Segment, Job or both
No less than $3 can be applied to any one option (so no betting $1 on ten items)
Provide a list of criteria against which each stakeholder can use to guide their bets, example, "what is our level of confidence in …"
Solution-Job Fit
Problem-Message Fit
Buyer Group and how to Target
Buyer's Process and our resulting Sales Cycle
The Landscape of Alternatives (Competitors)
Pricing + Packaging Fit
Ask each stakeholder to place their bets, independently from all the others
Aggregate the results before meeting, so no one changes their bet!
Bring the stakeholders together and ask each person to list out their bets and their rationale for each
In our experience, it is very common for the group to be in general agreement on the choices, but for potentially very different reasons.
Regardless, this has proven to be a good tool to rationalize well-informed opinions to gain consensus on priorities.
\KNOW BEFORE YOU GO
When planning, we so often dive straight into planning activities and the related resources required to execute. But understanding WHO and WHY before we spend time on WHEN, WHAT and HOW is critical to achieving our plan in this hyper-competitive market.
More importantly, not only do we improve the odds of us hitting our plan this year, but we do so by building a capital-efficient foundation on which to grow.
One of the major benefits of this methodical approach is that it forces hard discussions between the revenue leaders and the CEO, but with data and structure vs relying only on opinions.
Remember, this year's growth target is next year's baseline, so we better do this right.
