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Pruning Gives Other Services Room to Grow Rebecca Jones Dysart & Jones Associates [email protected] 905.731.5836 Service Lifecycle Management:
Pruning Gives Other Services Room to Grow
Rebecca Jones
Dysart & Jones Associates
905.731.5836
Service Lifecycle Management:
http://www.flickr.com/photos/wisdoc/234943522/
My lens
Introduced to portfolio management:
IT, Business development, Corporate
Began applying it in strategic planning and service reviews with
libraries and information services
Process missing in debate regarding virtual reference & now with
mobile services, digital branches, etc.
Formal research, informal conversations
“Service” definition
includes products
and programs
Our lens
Portfolio is a relatively new concept
Management of the service mix is growing
We‟re better at addition & multiplication
Could use some tutoring with division & subtraction
Decisions tend to be driven by usage, client satisfaction and budget
parameters…….and finally on strategic fit
Objectives
Consider portfolio management within the library context
And the service lifecycle
Provide some basic templates for you to use in your situation
Underlying assumptions
Successful organizations have a clear understanding of
who their clients are and what they have to offer those
clients
Focus on their differentiation
Know what business they are in
Librarians and entrepreneurs have much in common:
Enthusiastic about our offerings, service driven, tendency to
offer too many things to too many different markets
Underlying assumption
We allocate the majority of our resources to services: Delivery
Development
Management
Success relies on focus
We must focus our resources on those services that will ensure our success
Design & divestment are both critical phases, often minimized
We must understand the business we are in
What business are you in?
What is your focus?
What are you selling?
Who are your target clients?
The more we focus, the better we become
Find something that is critical to
your customers, and define a focus
around it such that you can bring
more talent, more resources to bear
on it than anyone else.
Simplified Strategic Planning by Bradford & Duncan
Current practices
Our current approach to managing our service portfolio or offerings is:
Strengths Weaknesses
Maximize value?
Achieve balance?
Align with strategy?
Service portfolio management
A holistic view of your service strategy:
current and future offerings
Provides the capability of viewing and managing your high-risk/high-growth services with your conservative offerings, and determining which services may not be on track and need help or need to be pulled
Portfolio Approach: Objectives
Maximize value of services in terms of the organization‟s objectives
Balance services offerings
Ensure you don‟t have more offerings than you can manage/support
Align services with strategy
Portfolio approach
Based on:
Cooper‟s “Portfolio Management for New Products”
Work by Boston Group on product life cycles
http://www.brs-inc.com/models/model14.asp
Cooper’s risk-reward bubbles
Thanks to Bob Cooper from
the Product Development
Institute and Sopheon
Boston Group’s matrix analysis
Problem children Stars HI
Dogs Cash cows
Market Share
Mark
et G
row
th
#1!!!
HI
HI
Portfolio development
Critical that you know:
Where the organization is headed
Those community or academic or client segments most critical
The depth and breadth of each offering
Client Interest
& Strategic Fit
Organizational Capability
HI
LOW
LOW HI
:
• Underpins or advances strategy
Strategic Alignment
• Offers customers/users unique benefits
• Meets customer needs better
Competitive Advantage
• Market size & growth potential
• Competitive positioning in market
Market Attractiveness
• Marketing synergies
• Technological synergies
• Operations or process synergies
Synergies (leverages our core competencies)
• Technical gap
• Technical complexity or uncertainty (or both
Technical Feasibility
• Expected profitability
• Payback period
• Low cost & fast to do
Risk vs. Return
Client Interest
&
Strategic Fit
Portfolio Management for New Products
By: Dr. Robert G. Cooper
http://www.prod-dev.com/downloads/working_papers/wp_11.pdf
Organizational
capability
Client Interest
& Strategic Fit
Organizational Capability
CRITICALDOUBLE OR
QUIT
PHASED
WITHDRAWAL
MAINTAIN,
NO GROWTH
HI
LOW
LOW HI
Review strategic goals
Study target groups
Inventory offerings
Identify client interest & strategic fit of each
offering
Assess organizational capabilities for each
Map offerings
Discuss, Debate, Decide
Portfolio
approach
Why?
Mission•Why does the library exist?
Where?
Vision•What is its desired future state?
What?
Offerings
What products, services or programs does it offer?
Who?
MarketWho are its primary clients or patrons?
How?
CapabilitiesHow will it create those services for those clients to achieve that vision & fulfill its mission?
Planning Framework
Strategic direction
What are the library’s or information center’s goals?
What are the community’s or the university’s or
organization’s goals or priorities?
Market Segmentation
Defining “like” groups
to be targeted
•Information behaviours
•Engagement preferences
Selecting Target Markets
Preferred markets should be: Attractive or Profitable
Can they „support‟ you? Can they „buy‟ your offerings?
Relevant Do they need your types of offerings? Is there a huge barrier to entry for you?
Strategic Do they fit with where you want to go?
Measurable Can you clearly define who is in the segment?
Accessible Can you get to them? Are the delivery channels in place?
Market Segmentation = Client Focus
Who are your target or primary clients?
Describe distinct primary & secondary target markets
what do you know about how these groups?
How do they work, study, live?
How do/will they apply your products/services in their work?
If they don’t ‘apply’, they won’t continue to ‘buy’.
Client focus
Products & services can only be designed, developed &
delivered when the client‟s behaviours & values are fully
understood
Once you have selected your client groups, profile them:
What do they need to „deliver‟?
What do they most value?
What offerings interest them?
Where do your offerings fit for them?
Determining
client interest
Inventory offerings
Services Products Programs
Description
Role: (what is it? what does it do?)Parts: (what are it’s key elements?)Delivery: (how is it offered?)Benefits: (what pain does it ease for clients?)Competition: (what can they buy/use instead?)Strategic fit:
Assessment of organizational
capabilities
Key inputs/resources:Cost:Specialized skills/capabilities:Cost:Technology:Issues:Total cost:
Market interest
Target:Size:Current interest:Growth potential:Uniqueness:Positioning:
Offering profile:_______________
Decisions, decisions
CONTINUE
Leader Balanced
Growth
Profile
maintainer
Try Harder Proceed with
Care
Phased
Withdrawal
Double or Quit Phased
Withdrawal
Divest - now
HI MED LOW
Low
MED
HI
Another tool to consider
Market Interest
Cap
ab
ilities
A strategic portfolio
Needs answers to these questions:
Which offerings will you concentrate on for target markets or primary patrons?
Which offerings will be leveraged for secondary clients?
What are the key features of the portfolio?
What will be particularly appealing about your portfolio for your clients? For your stakeholders?
Review strategic goals
Study target groups
Inventory offerings
Identify client interest & strategic fit of each
offering
Assess organizational capabilities for each
Map offerings
Discuss, Debate, Decide
Portfolio
approach
Discuss, debate
Questions to discuss:
Are the offerings complementary?
Are some offerings competing with others?
What offerings have a short shelf life?
What offerings have simply outlived their place?
What does our portfolio look like to stakeholders?
Decide
Most organizations will still have more offerings than they can
afford
Mapping the offerings, debating and discussing enables you to
decide which of these most closely align with the strategic
objectives and which, above all else, must be in your portfolio
Must be done regularly, at least bi-annually
Discussions may not be easy
Profiling takes time and energy
Potential of portfolio approach
Try components; take what works in your culture
Cooper‟s advice “proceed in a cautious, well-planned
manner”
Fact is, every organization needs a process for
monitoring which offerings are of value and which
should be shut down to make room for those of higher
value
Potential impact of portfolio approach
Advantages Issues
Maximize value?
Achieve balance?
Align with strategy?
Grab the Idea
Assess the Market
Define the Concept
Develop the Product
Develop the Marketing Plan
Test the Product
Launch Product and Marketing Plan
Manage the Product
Divest or re-invent
•Define target, needs & size•Identify competitive offerings
•Build Prototype
•Position product within market•Establish name and packaging•Establish price, sales and distribution
•Set market test objectives, sites, timeframe, training, documentation
•Client Satisfaction •Quality Control•Training
•Define Product and its components•Identify inputs needed•Confirm content and source
•Innovate, brainstorm, createService & Product Development Process
•Formal roll-out
Recommended sources
Bradford, Robert W. Simplified Strategic Planning, Chandler House, 2000
Burwell, B & R Jones, “Libraries & Their Services: Getting the Right Mix,” Searcher June 2005
Cooper, Robert G. Portfolio Management for New Products, 2nd
Ed., Perseus, 2001.
www.cio.com
Thank you!
Comments and suggestions to:[email protected]
