Sales & Strategy Playbook: Competitor Acquired? It May Be a Gold-Plated, Gift-Wrapped Opportunity

August 11, 2009 By Leave a Comment

While M+A activity has cycled along with the economy there are some signs that deal volume is picking up.

In talking with a CEO friend running a smaller tech firm, he indicated that there is increasing buzz about various potential combinations and roll-ups that will impact his specific sector. He said this with a smile, and an interesting observation that “when my competitors are acquired, our business spikes and new opportunities are uncovered.”

That’s an Interesting way to look at the situation. I know a lot of people who fear the outcome of Competitor X merging with Firm Y and respond by cowering behind corporate walls or flailing internally. Instead, my CEO friend advocates methodically seizing upon this as an opportunity.

A quick sidebar: The external pundits and internal fear-mongers like to exploit M&A situations for personal visibility.  It’s easy to sound like an expert and spread fear when no one can conclusively prove you wrong. In my opinion, if you were to provide the pundits and fear mongers with truth serum, they would be forced to admit that they have no more idea about the outcome of this merger than they do about the specific weather forecast for noon on a day far in the future.

While I would never counsel ignoring the potential disruptive or market-changing impact of a new combination, just like my CEO friend, I see ample opportunities to gain from an acquisition announcement for the smaller and more fleet-of-foot market participants.

Here’s why:

-Customers are immediately spooked. In the tech sector in particular, customer have been well-trained to react to an acquisition announcement of one of their suppliers with the knowledge that “this is going to hurt.” As a result, purchase decisions slow to a crawl, proof of concepts are derailed and risk-averse buyers begin looking for options that they can justify to their bosses.

You can professionally and ethically exploit this sales interruptus period.  You don’t have to and shouldn’t engage in hearsay and spread rumors as some firms do, but you should absolutely engage prospects (including those that you believed were recently lost to your competitor) and make certain that they know that you are the safe, secure choice focused on serving them.

-The company being acquired is horribly distracted. The press announcement is the beginning of the internal churn at the company being acquired. Confusion reigns supreme. Long-term projects are suspended. It’s not clear who will survive and what products will make the cut, and no matter how much cheerleading goes on from executives silently wondering the same thing, the business goes into autopilot mode.

Customers sense when a firm goes into autopilot mode and this makes them very uncomfortable and risk averse.  See the point above. It’s time to make hay.

-Consider cherry-picking talent. It’s a great time to approach the competitor’s top reps in particular.

There’s nothing an Alpha Rep hates more than having his/her potential sales glory impacted by extraordinary circumstances.  Any threat to the success of the hunt and the opportunity for commission accelerators and another club trip is a chance for your firm to gain some top sales talent.  Some will remain fiercely loyal, and others will seize the opportunity.  Again, do this professionally and ethically and consult counsel on non-compete issues.

-Watch for markets being abandoned. As the post-merger integration activities proceed, the newly combined firm will de-emphasize certain market segments in favor of others. This momentary “white space” can be just the opportunity to fuel your growth.

Make certain that your firm is watching closely and keenly attuned to any overt or even silent decisions to de-emphasize.  Listen carefully to your customers and prospects, they will sense this before anyone else. One firm’s unattractive market may be your treasure.

-Leverage the situation to build internal excitement and to fuel performance

There will never be a better time to get your teams fired up about serving new and long-standing customers and focused on identifying new products and services to exploit the changing market dynamics. Communicate and celebrate successes, encourage innovation and reward efforts that create value.

The Bottom Line for Now:

While the acquisition of key market competitors and participants can have profound long-term implications for your firm, there are often windows of opportunity created by these events that you can exploit to capture clients, strengthen market position and turbo-charge employee enthusiasm. Instead of fearing the worst, seize the opportunity to propel your business.

Filed Under: Leadership, Leading Change, Marketing, Performance, Strategy Tagged With: , , , , , , , ,

The Challenge and Opportunity of the Product Manager

February 17, 2009 By 2 Comments

Note from Art: this post came about through my on-going research with a colleague into best organizational practices in product management and product manager career development.  For additional information on this topic, check out my recent podcast interview with Michael Ray Hopkin at The Product Management Pulse and stay tuned for future posts.  

Product Managers face significant organizational challenges in their quest to expand their roles and increase their value-creating contributions to their firms.  

Through a recent and on-going series of interviews with senior executives as well as product managers across a variety of technology and manufacturing organizations, it is becoming clear that more and more organizations recognize the potential for product management to create tremendous value.  It is also clear that enlightened executives increasingly recognize that the professionals that work in product management roles are a ready-made source of high potential contributors and emerging leaders.  

Consider:

  • The Product Manager has the difficult and unenviable challenge of leading and influencing others across the organization without formal authority. The nature of the role requires the development of the lateral influence skills so critical to driving cooperation and execution inside organizations. 
  • Product Managers are charged with shaping market and offering strategies and are critical links to the Voice of the Customer.  The best product managers learn to interpret and translate this sometimes confusing “voice” into offerings that solve problems and create value for stakeholders.  
  • All too often, product managers and product management organizations struggle to transcend the persona of taskmasters and move beyond the never-ending, highly tactical activities.  Organizations that treat this function tactically are wasting remarkable opportunities to create value.
  • The role of product manager is a remarkable training grounds for a firm’s future leaders.  These professionals see the organization from all perspectives; survive and prosper on their abilities to educate, motivate and inspire action and are at the epicenter of driving strategy and execution. 

It’s encouraging to see that some senior leaders and leadership teams are beginning to “get it” when it comes to expanding the involvement, accountability and authority of product management teams and professionals. However, from the school of “be careful what you ask for,” product  managers also need to step up their game several levels in order to fulfill their expanding missions. 

Part of the feedback that my colleague, Joe Zurawski, and I are hearing from executives is that that the core functional skills that product managers have honed over time must be augmented by the development and expansion of a set of senior leadership skills that will allow for increased contribution.  

Senior executives are looking for their emerging senior contributors in product management to bring more advanced skills to the party, in the areas of: Leadership, Strategic Thinking, Executive Presence and Process Optimization.

Core functional/vocational skills are critical, but not enough to allow well-intentioned product management professionals to expand their contributions.  Nor is the “make it so” mandate from senior management that has decided it is time for this function and these professionals to provide more. 

To survive and prosper as senior contributors and emerging executives, product managers must:

1.  Strengthen lateral influence skills (the ability to lead and motivate without authority and across the organization).

2.  Develop the ability to recognize emerging patterns in the marketplace and translate that recognition into ideas (strategy & strategic thinking skills)

3.  Improve their ability to articulate and command credibility with senior executives (executive presence).

4.  Work relentlessly to improve execution and continuous improvement around value creation activities across the organization (process optimization).

The Bottom-Line for Now:

Developing the abilities and skills in those areas is no small task.  A deliberate focus by executives and their high potential product managers on developing skills and gaining experience in those four areas is essential.

All parties must engage in a focused development initiative that emphasizes exposure to diverse situations and ever-increasing levels of ambiguity and challenge.  Education and training are a part of the process, but mentoring and coaching should earn the lion’s share of focus.  Only through deliberate and focused action will organizations derive top value from their high potential product management assets. 

Anything less is a formula for same-old, same-old. In this economy, no one can afford to stand pat on the bad old practices of the recent past.  

Filed Under: Career, Leadership, Management Innovation, Product Management, Professional Growth Tagged With: , , , , , , , , , , , ,

Does Your Dashboard of Performance Measurements Include a Warning Light?

November 7, 2008 By Leave a Comment

Count me as one of the last idealists.  Or perhaps the last of the naïve idealists.  In a world filled with Quality Management Systems and Performance Measurement techniques backed by legions of people trained to implement and sustain quality performance, it seems reasonable to me that organizations are capable of not only keep themselves from imploding, but that they are armed to the teeth with tools to ensure prosperity beyond the wildest dreams of  Dr. Deming.

As an aside, Dr. Deming once famously indicated that it was his hope that his legacy was to keep U.S. companies from committing suicide.  Perhaps it is good that he is not here to see the firms elbowing each other out of the way in an attempt to get to the front of the line on the edge of the cliff.

  • The U.S. auto companies are almost finished carrying out their joint suicide pact in a world where the rules for success as an automobile company are on display for everyone to see.
  • Motorola, an icon of U.S. electronics has systematically destroyed itself by flailing and flailing in the mobile device (read: cellphone) world, and stands a reasonable chance of failing to survive without drastic action.   (See my earlier post on the Dollar Bill Auction to get a feeling for Motorola’s problems.)  The fact that Motorola is a Baldrige winner, one of the founding fathers of Six Sigma and an organization staffed with brilliant engineers, yet it cannot seem to engineer success is both puzzling and frustrating.
  • Earlier this week, Boeing indicated that they would again delay the launch of its now several years late and much hyped 787 Dreamliner.  The article indicated that the latest problem had to do with quality issues related to a new type of fastener required for the high tech and lightweight materials being used in the plane.  The advance sale of 900 of these puppies at $178 million a piece and the expected 20% fuel consumption savings has customers hopping mad over this latest in a series of seemingly endless project management and supply chain problems.
  • Financial services, banking, investment banking.  Ugh.  These icons of risk management succeeding in maximizing risk beyond their wildest expectations.

How does this happen in a world filled with balanced scorecards and legions of certified quality professionals constantly measuring, monitoring and striving to improve performance?  I suspect that my own answer is that while we have ample tools available for our use in building, the one tool that we haven’t yet mastered is staring back at us in the mirror.

In discussions and lectures with the up and coming generation of leaders, there is widespread cynicism over the intentions and the capabilities of many of their firm’s senior leaders.  There is little faith expressed that their leaders understand their firm’s key drivers and little confidence that the leaders are taking actions and measuring performance based on anything other than preconceived notions of what they think is right.  Fewer organizations than you might think are doing anything to engender employee satisfaction…which is ironic given the mountains of data that indicate that employee satisfaction flows through to customer satisfaction and strong financial performance.

This current generation of senior leaders is failing, and the very imbalanced scorecard is visible all around us.  The business cycle is one thing, but our problems go way beyond the business cycle to our preconceived notions of how to lead, how to run businesses, how to fuel innovation and how to create an environment where talent and calculated risk-taking are carefully cultivated.

Many organizations are hives of activity with no vector and the output is chaotic. Firms and top leaders need to quit guessing and start using the tools available to identify key business drivers and to measure and monitor the efforts and outcomes of focusing on those drivers.

The Bottom-Line for Now:

There’s nothing like a good old-fashioned crisis to engender creativity.  Well, we have one.  In spite of the difficulties, it’s a great opportunity for organizations and leaders to quit paying lip-service to cliché’s like customer-satisfaction, performance excellence and quality.  It’s a big world with a growing population and while the forecast is stormy now, the seas will eventually calm and the sun will shine.  It will be interesting to see who has the courage and fortitude to do the things necessary to make it through the storm.  Even money that we find a whole new generation of leaders in the process.

Filed Under: Crisis Leadership, Leadership, Leading Change, Surviving Lousy Leaders Tagged With: , , , , , , , , , , , , , , ,