By Peter Getchell, Managing Directory, Navint
Many of today’s high-growth companies have built their brand on the idea of product excellence—creating best-in-class products in order to fuel customer acquisition and retention. Often these companies seek to minimize bureaucracy and other organizational systems that may compromise the rapid release of new products, features or functionalities.
While many product-first organizations experience strong growth at the early stages of their business, it’s often the case that by focusing almost exclusively on the product, processes and operations supporting the business often lack the maturity needed to scale. During initial phases of growth, the organization can sometimes manage these challenges through manual intervention and point solutions. But as the organization continues to advance, shortcomings on the operations side can not only prove costly and time consuming, but also negatively impact retention, as inadequate processes can manifest as friction within the customer experience.
For example, taking a new product to market without thinking through pricing, bundling, revenue recognition and commissions, can lead to serious implications as it relates to finance, tax, commissions and more. This is especially true as customers move from traditional hard good orders to a subscription-based model, which engages the entire company. To continue to meet the needs and preferences of the continuous customer within a recurring revenue business, it is important for every piece of the customer experience to be connected—which means focusing on both product and process excellence.
Embracing a “product plus process” mindset
As organizations continue to scale, it becomes increasingly difficult for the business to recover from operational shortcomings. For example, when a $100M revenue company with thousands of clients makes a product-wide mistake in billing or provisioning, it may be time-consuming and complex to fix, but it is possible. On the other hand, when the organization is processing three to four million transactions a month with hundreds of thousands of customers, these issues can take much longer to resolve. In these cases, friction in operations carries much more serious consequences.
However, when product-first companies apply their culture of customer focus to internal processes—lead-to-renewal, sales operations, finance, billing, etc.—velocity and business results accelerate. At Navint, we call this “product plus process” approach, Innovate to Operate™.
A “product plus process” approach ensures that business services are connected in a way that provides end-to-end value. The organization measures value as it relates to the business as a whole—not individual products and the release of new features and functionalities.
Innovate to Operate: Achieving “product plus process” excellence
It is important to note that in today’s business landscape, product excellence and process excellence are not mutually exclusive. In fact, quite the opposite, businesses should marry them to enable new levels of efficiency and fuel growth.
For many product-first businesses, this will be a marked departure from their existing approach. As they begin to focus on process excellence it will be important to maintain their core values of speed and agility. Process excellence need not be seen as a behemoth initiative that takes years to show results, but rather as an incremental transformation initiative capable of jumpstarting growth.
At Navint, we often advise clients that one of the best ways to begin this journey is to focus on establishing solutions to known areas of friction. These quick wins will help build credibility and support within the organization for process transformation. In addressing obvious pain points, the business can also focus on defining the interaction among business services, which will often lead to discovery of improvements in adjacent service areas and drive the next wave of transformation. In time, we encourage the organization to stop thinking in terms of product or process and instead embrace the underlying concept: excellence.
To learn more about Navint’s “product plus process” and Innovate to Operate™ approach, please contact email@example.com.