Insights on How to Productize Services and Solution Offerings
A collection of news, insights, and best practices for productizing services, conducting market research, developing new products, and commercializing offerings.
As professional services firms evolve and productize, a significant shift from relying solely on traditional service revenue to seeing substantial product revenue happens. This shift is more than a strategic pivot; it necessitates a fundamental change in financial operations and metrics.
Because productization can require significant investment, market sizing is often an important first step in testing the viability of an opportunity because business leaders need confidence that the investments have a good chance of paying off. Too often, B2B organizations rely on top-down market sizing to drive investment decisions. There seems to be an all-too-common practice of showing an opportunity is viable by arguing that you just need to capture a small percentage market share of a huge market segment in order to have a booming business. But this common top-down approach ends up misleading organizations into poor decisions because the models are designed mainly for direct-to-consumer businesses to make assumptions about vast markets. And these types of results provide no answer about near-term potential revenue.
Productization is a journey that can involve innovation, digital transformation, and business model changes. Long-term goals of scalable revenue and profitability can often seem far away. This blog aims to give you practices you can bring to your organization to keep your team motivated by identifying and celebrating successes and quick wins.
As markets evolve and industries face new challenges, many firms find themselves at a crossroads, contemplating the shift toward productization. Productization can significantly enhance valuation, streamline operations, and boost competitiveness. But what triggers a professional services firm to productize? Let’s explore the eight most common reasons that move B2B services organizations from traditional service models to a more productized approach.
From time to time, I get a call from a pro-serv company that has invested a lot of time and money into launching a product that simply isn’t selling. They don’t know what went wrong. Can we help? After a little digging, we often find out they didn’t get enough (or any) market feedback as they were building. They were sure about the solution/product/offering and wanted to get right to selling. In the right situation, I am all for going right to selling, BUT do it without building anything! Save thousands of dollars, maybe hundreds of hours, and Sell then Build.
As 2024 unfolds, the transformative impact of artificial intelligence (AI) on professional services is increasingly apparent. In a recent discussion on the Professional Services Pursuit podcast, hosted by Banoo Behboodi, Vecteris’ Eisha Armstrong explored how AI is helping professional services organizations rethink how they solve problems and create value.
In the realm of B2B professional services, where expertise and tailored solutions are the main offerings, the challenge of introducing new technology products or tech-enabled services is magnified as they can require significant upfront investment as well as new skill sets. Imagine if you could first test your new product concept with actual live, paying customers to be sure there is market demand before making that significant investment.
In today's fast-paced sales environment, equipping your team with the right tools is crucial for success. For organizations with lots of products, one such tool that can significantly enhance the effectiveness of your sales process is a decision tree.
As you embark on your productization journey, you're likely to encounter some familiar roadblocks – first, the need to quickly demonstrate value, and second, overcoming internal resistance to change. But here’s the good news: the secret weapon to generating ‘quick wins’ to overcoming these challenges lies in a focused approach to learning.
In 2023, we saw an accelerated shift of market trends that affirms the need for B2B professional services firms to form a digital strategy to compete.
