I had a good conversation with the supply chain director for a manufacturing company in the Bay Area last week. In giving his assessment on how his company is approaching technology these days he said, “Before we implement the next piece of software, we’re going to make sure it thinks the way our business thinks.”
Wisdom in Every Customer’s Rant
It might sound obvious, but technology vendors need to start thinking more like customers to succeed. What many vendors fail to realize is that it usually takes years before a company experiences the benefits of any complex system implementation. For example, many organizations that implemented enterprise resource planning (ERP) systems five years ago are only recently reaping the rewards of their decision. Integrating new solutions into an organization is a lot like open-heart surgery; there is a recovery time before the benefits can be felt.
This fact translates into huge challenges for companies marketing and selling enterprise solutions in today’s market. After all, it’s impractical to estimate a return on investment (ROI) using a five-year timeline.
So where do the opportunities lie for vendors? Well, in my estimation, several drivers will dictate future investment decisions about business solutions or technology. Vendors that score well against these factors have a great chance of success. Below are these drivers.
Many companies were burned by overzealous investments into unproven technology, such as personalization, one-to-one marketing, and marketplaces. Naturally, companies have since gravitated to addressing fundamental company needs instead of pioneering future concepts. As a result, there is little patience to invest time or effort into solutions that don’t directly augment sales or save the company significant amounts of money.
Based on my observations, most companies are looking to leverage existing systems and assets. The running question of the day is, “How do we get more out of what we have today?” As a result, there has been renewed interest in portal or integration technology that helps a company tie its systems together.
Costly and protracted implementations are completely out of favor these days. There is little tolerance for invasive solutions that require major process or organizational changes. Simple solutions with low implementation costs have gained an advantage over their more complicated counterparts.
As a test, I recommend all tech vendors benchmark implementation time and costs against their nearest competitors. Speed matters, even at the expense of the functional characteristics of your product.
The “R” Factor
News flash! Only three things matter to most companies today: creating revenue, preserving revenue, and reducing costs. If your solution doesn’t directly influence these three goals, it might be time to consider a new marketing or product strategy.
Increasingly, technology decisions are moving out of the IT department and into the boardroom. This transformation requires most companies to speak to a new audience. In the past, the highest level of contact for most vendors was a division head or CIO. Today, it goes all the way to the top. Make sure your marketing material and approach suit the audience.
Commodity or Competitive Tool?
The tech world is strewn with commodity-like solutions that have little impact on making an enterprise more competitive. If you find yourself marketing based on features and function, you are pursing an ineffective strategy. Why do you think case studies are so important to customers? It’s because all companies are seeking some type of strategic advantage.
Quality Is Job No. 1
Quality control has been viewed as an option, rather than a requirement, for many technology vendors over the past decade. As a result, many companies have had terrible experiences implementing solutions from leading technology vendors. Bugs, performance issues, and a host of other “unintended features” plague our industry today.
That’s why companies with reliable, simple, and easy-to-maintain solutions are finding traction in this market. The tech world has come to prefer Honda Civics to Alfa Romeos.
If you are in the tech-marketing world, what is the diagnosis of your company’s strategy? Could you learn something if you spend some time as a customer? I’d be interested to find out.