THE ESSENTIALS OF STRATEGIC PRODUCT LEADERSHIP

The idea that companies succeed by selling value is all but novel. What is new however, is how customers define value in many markets. In the past, customers judged the value of a product or service on the basis of some combination of quality and price. Today’s customers, by contrast, have an expanded concept of value that includes convenience of purchase, after-sales services, dependability, and so on. One might assume, then, that to compete today, companies would have to meet all these different customer expectations. This, however, is not the case.

Companies that have taken leadership positions in their industries in the last decade typically have done so by narrowing their business focus, not broadening it. They have focused on delivering superior customer value in line with one of three value disciplines - operational excellence, customer intimacy, or product leadership. They have become champions in one of these disciplines while meeting industry standards in the other two. This Article focuses on product leadership, however, subsequent ones will be centred on the other two disciplines respectively.

Stakeholders in any given business model are always seeking out methods, steps or techniques to place their products and services above other competing or substitute commodities from other organizations. This article seeks to effectively evaluate organizational standards and best practices for product leadership and how any organization can establish its product and/or services as product leaders in their respective markets.

Product leadership basically entails particular products and/or services of an organization dominating whatever market space they exist in. It generally aims to build a culture that continuously brings superior products to the market. Product leaders often achieve premium market prices, thanks to the experience they create for their customers.

Loads of companies have outstanding products in terms of performance, technology and features. And yet, surprisingly, sales do not take off as expected. This article seeks to explicate how leading products and services captivate the marketplace by having more than just the functions and features that customers want. Leading products also inspire and deliver benefits through emotional fulfilment that customers enjoy and seek out.

In one way or another, every book on managerial leadership will say that leaders inspire and energize. Organizational leaders are known to be people-focused, looking to add value to their followers rather than focusing on building their own power base. Successful leaders also do not try to preserve the status quo but are willing to set a direction for change, provided they foresee the change to be for the better. It may be surprising, but a product leader requires the same characteristics. To be clear, “product leadership” means much more than market share leadership. Leading products energize and inspire people. They are people-focused in that they are developed with the people in mind that want and need them. Product leaders set the direction for the industry, changing the status quo and serving as benchmarks for others.

Leading products not only deliver performance as promised, but, more importantly, they deliver desired emotions as well, emotions that result in product leadership. Delivering emotions essentially entails purposefully designing a product in such a way that it evokes specific emotions in those who interact with it. Emotions are therefore a planned product benefit just as the product’s performance benefits. Research after all, shows that the major driving force for decision-making is emotion. Aspiring product leaders must discover ways to appeal to the emotions of prospective customers. In any industry where people interact in some way with a product, emotion matters. This is true not only for consumer companies, but for those in the business-to-business market; it is equally important for large global companies and small niche firms. When a product delivers emotions – emotions such as care, support, joy, respect – that product has the potential to make people’s lives better.

Companies that focus on product leadership push the envelope on product development. They create products that change the way the customer lives and/or plays. They create a culture of innovation, out-of-the-box thinking and rarely punish failure. Companies like Apple and Sony are considered to be companies that focus on product leadership. For any company to institute its goods and/or services as market leaders, there are some basic principles that must be stringently adhered to. To pursue a strategy of product leadership involves delivering value through offering leading edge products and services, creatively adapting services, providing a stream of new and changing marketing conditions while constantly pursuing new solutions on behalf of its clients and customers.

Companies that pursue product leadership strive to produce a continuous stream of state-of-the-art products and services. Reaching that goal requires them to challenge themselves in three ways. First, they must be creative. More than anything else, being creative means recognizing and embracing new and innovative ideas. Second, such innovative companies must commercialize their ideas quickly. To do so, all their business and management processes have to be engineered for speed. Third and most important, product leaders must relentlessly pursue new solutions to the problems that their own latest product or service has just solved. If anyone is going to render their technology obsolete, they prefer to do it themselves. Product leaders do not stop for self-congratulation; they are too busy raising the bar.

Any company that intends to implement product leadership should therefore strive to sufficiently imbibe the following disciplines:

·Creativity (Research portfolio management, teamwork, innovation)

·Speedy commercialization (Product management, marketing, cost effectiveness)

·Continuous improvement and advancement(continual research and procession on existing goods and services)

The chart below further explicates the fact that any organization seeking market leadership for its commodities has to be in line with the three essential traits stated above.

Product leaders recognize that excellence in creativity, problem solving and teamwork is critical to their success. This reliance on expensive talent means that product leaders seek to leverage their expertise across geographical and organizational boundaries by mastering such disciplines as collaboration and knowledge management. Employees should be encouraged to work in teams for more effective and path-breaking results. As the popular saying goes, two good heads are better than one.

Product leaders create and maintain an environment that encourages employees to bring ideas into the company and, just as important, they listen to and consider these ideas, however unconventional and regardless of the source. Incentive systems should be set up for ideas that eventually pull through and make the company money. Basic economics has proven beyond reasonable doubt that man, by nature, seeks out self-interest above all things. Mere knowledge of the fact that there is some form of benefit for bringing forth utile ideas is inspiration enough for employees to brainstorm and strive for acute insightfulness.

In addition, product leaders continually scan the landscape for new product or service possibilities; where others see glitches in their marketing plans or threats to their product lines, companies that focus on product leadership see opportunity and rush to capitalize on it. As an organization reaching for product leadership, it is paramount to always be on the lookout for fresher, more scintillating and more appealing ways of making your products and services unique and bankable. This also applies to the creation of new commodities.

Product leaders avoid bureaucracy at all costs because it slows commercialization of their ideas. Managers make decisions quickly, since in a product leadership company, it is often better to make a wrong decision than to make one late or not at all. That is why these companies are prepared to decide today, then implement tomorrow. Moreover, they continually look for new ways, such as concurrent engineering, to shorten their cycle times. Japanese companies, for example, succeed in automobile innovation because they use concurrent development processes to reduce time to market. They do not have to aim better than competitors to score more hits on the target because they can take more shots from a closer distance. Companies excelling in product leadership do not plan for events that may never happen, nor do they spend so much time on detailed analysis. Their strength lies in reacting to situations as they occur. Fast reaction times are an advantage when dealing with the unknown. Product leaders have a vested interest in protecting the entrepreneurial environment that they have created. To that end, they hire, recruit, and train employees in their own mould.

Furthermore, product leaders seek out cost effective methods of production. They realise early that majority of the customers for any product usually seek out products that are of high quality and comparatively low prices. Their understanding of this concept helps them by efficaciously creating an avenue for competition even in a somewhat saturated market.

Effective marketing is another noteworthy trait. Product leaders seek out maverick and prolific marketing strategies to efficiently create awareness for their goods and services. The fact remains that every product and/or service has its own specific market space and target consumers. Marketing should compulsorily be done within the sphere of the prospective customers or clients. Of what use is it to market a briefcase to secondary school students or a Lamborghini to a middle-class citizen?

Product leaders are their own fiercest competitors. They continually cross a frontier, then break more new ground. They have to be adept at rendering obsolete the products and services that they have created because they realize that if they do not develop a successor, another company will. In other words, they are always working at improving the current products and services before their competitors catch up with them. These companies are never blinded by their own successes. It is only perspicacious to have a research and development team, not only to seek out new products, but also, to propose ways and techniques of improving the existing ones. This, in turn, ensures that said products are never obsolete, but, are ever ready to compete against whatever available or prospective competitor.

Another maxim imbibed by product leaders is that they usually possess the infrastructure and management systems needed to manage risks well. Tremendous risks are usually associated with developing and launching new products or even making advancements on old ones. Becoming an industry leader requires a company to choose a value discipline that takes into account its capabilities and culture as well as competitors’ strengths.

Any organization that can effect the principles stated herein is on the right and fast track to becoming product leaders in the different markets of their respective products and services.