Haen juuri alkaneen lisäksi 2-3 uutta hallitusjäsenyyttä yrityksissä, joissa ydinosaamiseni “kuinka rakennetaan kannattavaa ja skaalautuvaa kansainvälistä ohjelmisto- ja palvelubisnestä” tuottaa selkeää lisäarvoa.

Asetin vuoden 2018 alussa uralleni kolme pääsuuntaa, jotka kaikki toteuttavat samaa tavoitetta, olla auttamassa suomalaisia yrityksiä kannattavan, kestävän kasvun rakentamisessa ja kansainvälistymisessä.

Startup-yrityksille lisäarvoni on pääomasijoittajan näkökulmasta investoinnin riskinhallinta sekä sijoituksen tuotto-odotuksen maksimointi käyttämällä oikea aikaisesti kokenutta vuokra-asiantuntijaa poistamaan kasvun esteitä.

Kasvuyrityksille lisäarvoni on yrityksen kannattavan kasvun sekä skaalan mahdollistaminen. Juurisyyt kasvun ja kannattavuuden ongelmiin löytyvät usein yrityksen tuotteista ja palveluista, näiden kaupallistamisesta sekä operatiivisesta johtamisesta.

Hallitusjäsenyyden kautta lisäarvoni yrityksille syntyy kansainvälisen ohjelmisto- ja palveluliiketoiminnan laaja-alaisesta kokemuksesta tuotekehityksestä, tuotehallinnon kautta liiketoimintavastuuseen pörssiyrityksen johtoryhmän jäsenenä.

Jakamistalouden hengessä uskon, että hallitustyöskentely on oiva tapa jalkauttaa osaamistani ja tuoda yritykseen kipeästi kaivattua kokemusta.

Ota rohkeasti yhteyttä niin tavataan, testataan kemiat ja ymmärretään yrityksenne tarve.

Terveisin Pekka

This is Part-Time Genius Blog on how to grow your business in a profitable and sustainable way.

Why is pricing important? 

Pricing has the highest impact on the growth and profitability of a company yet often very little is invested in planning it compared to the dedication businesses put to customer acquisition, customer retention, or defining product functionality.

According to a great read "The anatomy of SaaS pricing strategy" by Price Intelligently, the average SaaS company spends six hours on pricing over their whole lifecycle. 

Come on - that's less than a working day! 

How much does your company spend on understanding pricing?

Make no mistake - this is not a SaaS-only matter. Pricing is equally important to all businesses on any competed market. Just that in the SaaS business model, pricing has elevated importance as the company has to monthly (read continuously) earn the justice to bill the customer. 

Without an emphasis on pricing, you underserve customers and leave revenue on the table.

Three dimensions of pricing strategy - positioning, packaging, and the price.

Let's start off with positioning.

In sound product planning, after defining a compelling product vision (something you dare to get a tattoo) which states the core business benefit and the target user, you should deep dive into user personas.

Who do you serve - what industries are they in, what is the customer company like, what is the role of the persona in that company?

Here clarity makes the difference. Think it as if you would see a group of people walking down the street and you can say without hesitation who belongs to what segment and why. 

Come up with a handful of personas that are distinctive and relevant to your business. Here quality over quantity rules.

As I wrote in my earlier blog post "WHAT, WHY, TO WHOM AND HOW" these questions are dead simple, yet it can be grueling to find the right answers. 

Likely that's the very reason why companies too often skip the act with predictable outcomes - producing mediocre products and services that are not solving anyone's problem. 

Next, you want to know what are the high-value features for each of the user personas, and how much they are willing to pay (WTP) for those. 

Why is it relevant to find the high-value features and WTP?

Let's invite in the two other dimensions of pricing. 

Take your product feature list and ask your existing customers and prospects to sort them into two baskets - the most preferred/valuable ones and the least preferred/valuable ones. 

As an outcome, you don't only see what features are valuable for your customers but you understand what features the different personas value.

You will see also what features you can well live without as they don't deliver value to your customers.

That's your product packaging.

Now it's getting even more interesting as you are about to learn what your customers are willing to pay for the high-value features. That's the essence in value-based pricing.

Based on the product positioning and packaging examples above, you should now have a pretty good understanding of the different product packages, how they differ from each other and who are their customer personas - right?

Next, you go and ask from the existing customers and prospects behind the personas what they would be willing to pay for the product "package" you just designed.

With four simple questions and numeric price point scale, you can build a surprisingly solid understanding of the price range for each product package. 

Your questions are - at what price would you consider the product to be too expensive, at what price would you consider the product to be too cheap (relative to perceived quality), at what price would you have to think twice before buying, and at what price would you consider the product to be bang for the buck?

When you match the price range data with customer lifetime value (LTV) and customer acquisition cost (CAC) you can further define at what price point the LTV/CAC ratio is optimal. 

Why's LTV/CAC ratio relevant - higher the ratio, greater the growth of your business. 

See, for these questions, you just cannot shoot the answers from the hip but you need data. In practice, it means that you have to go out and interview your customers and prospects.

In case you don't know LTV and CAC for your product, go and find them - it will be an eye-opener.

Why should you be paranoid about the pricing of your products? 

When your product pricing is clear, value-based, targeted to the right audience and is aligned with the buyer's willingness to pay, a big part of your marketing and sales effort has already been taken care of, not to forget that you'll growth faster with increased profitability.

In an evolving marketplace, pricing is a continuous optimization effort of your product value against the customers' willingness to pay. Pricing is a process.

By the way, pricing is the lever that has 1:1 impact on profitability - pretty cool.

What's your excuse for not investing in proper pricing?

Again, if you have good practises on the covered subject, let me know as I'm eager to learn from the best.

Cheers,

Pekka

Improving Product Management capabilities and practices, crystallising business strategy, startup company's product concept grooming, channel partner on-boarding process validation, mentoring CEO on profitable sustainable growth, ... these were few examples of the super-interesting themes I have had a chance to work on during the last weeks. 

Hats off to individuals who I have met and who have openly told about the challenges their companies face. Special thanks to those with whom we have started a journey to improve the discovered issues.

Common to all of the examples mentioned above is that they look for answers to "what", "who", "how" and "why" in the business context.

When discussing the above topics and the issues behind them, I often get the comment that "Pekka, this is basic stuff in our company".

I agree. These are definitely the "basics" behind company's success, however, often these "basics" are implemented only mediocrely in the company.

The basic assumption is that "basics" are fine. Wrong - I can say from the experience that generally they are not in good shape.

Even though the questions are puzzling simple, getting well articulated and clear answers to them is surprisingly difficult and above all time consuming.

My observation is that dealing with the "basics" is less respected and valued than working on "more sophisticated" stuff that at least apparently has more momentum and sense of progress.

I am fully convinced that the most successful companies are very explicit about the quality of the "basics". By doing the "basics" properly, timely, in the right order, to the right extent and iteratively, business success is guaranteed or at least highly probable.

Another observation relates to company's growth capabilities and above all to timely availability of the crucial capabilities. I addressed this topic in my previous blog "WHY INTERIM MANAGEMENT CAN HELP MICRO AND SMALL BUSINESSES GROW"

Getting the "basics" right, does require constant efforts, commitment, ownership, proper resourcing and time.

An analogue from construction business: the dull, dirty, costly ground work which is often invisible to the end-user, are the "basics" one cannot shortcut if long-term profitability and customer value is the target.

When the "basics" are right, or at least you know how they are, your company will significantly improve chances of success in building sustainable, profitable growth.

This is where Part-Time Genius Expert-as-a-Service help you.

Call 0405050698 or email pekka@part-time-genius.com and let's figure out how we can improve your company's competitiveness fast and with an impact.

Get the "basics" right from the beginning.

BR Pekka

Tuotehallinnon kyvykkyyksien ja praktiikoiden kehittämistä, yritysstrategian kirkastamista, startup-yrityksen tuoteidean jalostamista, kanavakumppanien onboardaus-prosessin viilausta, ylemmän johdon mentorointia kannattavan kasvun tiimoilta, ... muutama esimerkki mielenkiintoisista ja yrityksen kilpailukyvyn kannalta keskeisistä alueista, joihin olen päässyt tutustumaan viimeisten viikkojen aikana.

Kiitokset luottamuksesta kaikille niille, jotka ovat avoimesti kertoneet yrityksensä haasteista. Erityiset kiitokset niille, joiden kanssa olemme aloittaneet yhteisen matkan havaittujen asioiden parantamiseksi.

Yhteistä kaikille mainituille esimerkkitapauksille on, että niissä haetaan yrityksen kontekstissa vastausta kysymyksille "mitä", "kenelle", "miten" ja "miksi".

Keskustellessa edellä mainituista aiheista ja niiden takana olevista kysymyksistä, useasti tulee vastaan kommentti, että "Pekka, nämä ovat meidän yritykselle ihan perusjuttuja".

Olen samaa mieltä. Nämä ovat ehdottomasti "perusjuttuja" yrityksen menestyksen takana ja kuitenkin nämä "perusjutut" on yrityksessä toteutettu seiskan keskiarvolla.

Analogiana voi käyttää talonrakennusta: perustusvaiheen tylsät, likaiset, kalliit ja  välittömän asiakasarvon kannalta näkymättömät työvaiheet ovat juuri niitä "perusjuttuja" joissa ei voi oikaista kun tavoitellaan pitkän aikavälin tuottoa ja asiakasarvoa.

​Kun "perusjutut" ovat kunnossa, tai vähintään tiedätte missä kunnossa ne ovat, yrityksen mahdollisuudet rakentaa kestävää, kannattavaa kasvua paranevat merkittävästi.

Tässä Part-Time Genius vuokra-asiantuntija on oikea työkalu.

Soita 0405050698 tai lähetä sähköpostia pekka@part-time-genius.com niin mietitään yhdessä miten parannamme yrityksesi kilpailukykyä välittömästi ja mitattavasti.

Ei ole olemassa muuta kuin "perusjuttuja".

Terveisin,

Pekka

Hannu Mänty, Chairman of the Board at InHunt Group kicked off a very interesting discussion this morning in LinkedIn. He asked whether companies should publish salary ranges in their job ads and who would it benefit if anybody at all. 

My thoughts can be read below and you can follow the original discussion in Finnish here. 

Companies should publish the salary range with other job details. Why?

As salary should be attached to position, not to person, company for sure has defined the salary target range. The term salary as I use it here includes bonus and other incentive components.

As an active job seeker, this is very relevant topic as I have come across with it recently, actually this week. It is fair to expect that the hiring entity, be it a business or non-profit, has a crystal clear picture of the needs defining the position and its requirements (this is not always the case).

Visibility is good. Published salary range would give the applicant an instant understanding on the salary level of the industry and the company. Yet for both parties it is clear from the beginning that inside the same industry companies are different and can apply different compensation schemes.

It is about setting and managing expectations.  

Salary is only one part of total reward. Career and development opportunities are often considered at least equally important to pay and benefits. These, together with the work environment and company culture build the employer image. In the fight for the talents, employer image makes the difference.

I would argue that, to an increasing extent, instead of pay, employee interest is moving towards total rewarding where the above-mentioned components together make a compelling package for the employee. It also gives more leeway for the employer to differentiate. A small business cannot necessarily compete with the salary but instead it can offer a position where one can have a direct impact to company's performance and growth. 

If you are interested in the topic, ping me and let's talk more about it.

BR Pekka at part-time-genius

Hi all and welcome to take a look at the Part-Time Genius site we have published just few hours ago. We are super-excited about it and are eagerly looking forward to connect with you, either by doing business together or by having good discussions at Part-Time Genius blog.

What is Part-Time Genius all about? Simply put - we are passionate, experienced business professionals helping companies of all sizes unleash their full business potential by removing impediments limiting growth and profitability. 

We firmly believe that companies have just so much more to achieve by better planning and balancing the key elements of business 'human resources', 'processes and systems', 'products and services' and 'financial resources'. 

What's holding companies back then? Bias to short-term profitability and the fact that time is the most scarce resource for companies. Read how Part-Time Genius can help on this.

Let's keep this intro short and continue the discussion at Part-Time Genius blog or even better, when we have a chance to meet you. 

... and if you have any comments or improvement proposals concerning the site, please do send them to us.

BR Part-Time Genius