Win-Loss: A Closed-Loop System for Continuous Innovation Boston Product Management Association SCIP Boston Ken Schwarz Marketing Director Progress Software November 15, 2012

Getting Started Setting up a Win-loss Program Tonight’s Agenda: How can you do it all? How do you keep it from becoming a colossal waste of time? 1 of you 50 sales reps 500 deals won or lost

Win-loss A Product Management/Marketing Perspective Pricing Buy, Build or Partner Business Plan Product Profitability Win/Loss Analysis Distinctive Competence Market Problems Marketing Plan Customer Acquisition Customer Retention Program Effectiveness Buying Process Buyer Personas User Personas Positioning Product Portfolio Market Definition Distribution Strategy Innovation Competitive Landscape Technology Assessment Lead Generation Thought Leadership Referrals & References Launch Plan Use Scenarios Requirements Status Dashboard Product Roadmap Presentations & Demos Event Support “Special” Calls Channel Support Channel Training Sales Process Collateral Sales Tools Business Market Programs Planning Strategy Support Readiness Strategic Tactical “Pragmatic Marketing Framework” © 1993-2012 Pragmatic Marketing, Inc. All rights reserved

Win-loss A Product Management/Marketing Perspective Pricing Buy, Build or Partner Business Plan Product Profitability Win/Loss Analysis Distinctive Competence Market Problems Marketing Plan Customer Acquisition Customer Retention Program Effectiveness Buying Process Buyer Personas User Personas Positioning Product Portfolio Market Definition Distribution Strategy Innovation Competitive Landscape Technology Assessment Lead Generation Thought Leadership Referrals & References Launch Plan Use Scenarios Requirements Status Dashboard Product Roadmap Presentations & Demos Event Support “Special” Calls Channel Support Channel Training Sales Process Collateral Sales Tools Business Market Programs Planning Strategy Support Readiness Strategic Tactical “Pragmatic Marketing Framework” © 1993-2012 Pragmatic Marketing, Inc. All rights reserved

Getting Started Setting up a Win-loss Program Don’t just ask the field They’re too busy They seldom know why they lost

Getting Started Blind and Anonymous Customer Interviews Why blind & anonymous interviews? Most objective source of intelligence Customers & sales reps are more likely to cooperate Hire a consultant to call customers for you Only ethical way to make blind calls Only practical way to call many customers Interview a representative sample 10 starts to yield statistical significance Even a few yield fascinating anecdotes Biggest challenge was getting contacts to call

Getting Started Blind and Anonymous Customer Interviews Reading a blind interview transcript is like being a fly on the wall. Use high-level interviewer who understands market and decision- making process. Executives won’t take canned/scripted calls. Our interviewer conducted calls using a standard method: Discover or confirm those criteria that were important and helpful to making a decision. Weight/prioritize the criteria. Rate vendors for the criteria. Ask why they rated vendors as they did. Executive Summary Score Summary Verbatim transcript . . .

Getting Started Internal Win-loss Field Debriefs ALSO, do field debriefs to find out what happened from the sales teams. Issues Questions General background How did you learn of the opportunity? Value proposition used? Partners used? Corporate executives used? Competitors’ tactics What did they do? How did they respond to your competitive tactics? Your strategy What strengths did you emphasize and how did you show them? What worked or didn’t work? Recommendations What should other field teams know? What should corporate do to support you better?

Getting Started Internal Win-loss Field Debriefs Field Debrief best practices: Invite sales team, product management, product marketing, industry marketing, etc. Record call. Make a transcript for later reference and share with those who couldn’t come. Use customer win-loss interviewer – helps you scale and builds trust with field. No substitute for customer interview, but has many benefits: 100% response rate Creates credibility with field Immediate access Creates buy-in Success story fodder Get customer contacts

Getting Insight Win-loss Analytics: Introducing “Plumbersoft” “A leading pure-play provider of middleware, helping large organizations create new business applications by leveraging data and functionality trapped in their legacy environment…” Founded 2001 Roughly $80m in revenue Competitors: IBM, Oracle, TIBCO, Software AG, Progress, Ant Hill, etc. You are entering a dimension of imagination…

Getting Insight Win-loss Analytics – “Wizard Chart” Reasons you Lose Reasons you win High Criteria in the upper left corner are the key reasons you lose to competitors. Criteria in the upper right corner are the key reasons you win over competitors. Impact on the customers’ decision Low Unfavorable Customer Opinion Favorable Customer Opinion Note: Wizard Chart is protected by U.S. Patent 5,734,890, Richard Case and PSP Enterprises

Getting Insight Win-loss Analytics – Plumbersoft Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion

Getting Insight Win-loss Analytics – Customer Engagement Voice of the Customer: “Plumbersoft had people who were justice and public safety specialists, who were actually assigned to the project and they stated that right from the get go. The depth of knowledge in the subject area was critically important to us. We were very impressed and their technical people are good too. And they were nice. They weren’t arrogant. They worked very closely with the team and you could see they would work as a team.” Plumbersoft Win over Oracle at a law enforcement agency for $34M Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Product Line Integration Losses Wins Vendor Viability Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth Low 31 Losses 22 Wins Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion “Customer Engagement” – Typically tops the list Listening and understanding is most important Critical that demos empower, not bewilder the audience Prove your support and responsiveness Here, neither side “owns” this issue – It’s a tactical, not a strategic advantage

Getting Insight Win-loss Analytics – Product Line Breadth Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion Product Line Breadth is a strategic weakness for Plumbersoft. Plumbersoft, a pure-play, can’t compete with IBM or Oracle in terms of breadth. It’s winning in this area when competing against smaller pure-plays. It’s losing sometimes against arch rival Ant Hill – PM needs to fill a hole in the lineup!

Getting Insight Win-loss Analytics – Simulation Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion What can we do now? PUSH YOUR STRENGTHS, PLUMBERSOFT! Simulation – A Strategic Advantage – Never lose with this one! Do you market this front and center? You should! Does your sales process get the issue into the POC? It should!

Getting Insight Win-loss Analytics – Proof of Concept Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion PoC – The manifestation of product in the customer engagement. How much of your R&D is directed at PoC-visible functionality? Is your field really trained and organized to win them? Benchmark yourself against the toughest competitor

Getting Insight Win-loss Analytics – Vendor Viability Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion For Plumbersoft, a strategic weakness. An issue to be COUNTERED, not won. Customer References and Corporate Marketing (AR/PR) are critical.

Getting Insight Win-loss Analytics – Customer References “Plumbersoft gave better testimonies as references. Their reference sites were excellent. It gave us a lot of confidence.” Plumbersoft Win over IBM at a bank for $5.5M in UK D “They [Plumbersoft] actually had some references that we talked to had a lot of problems.” Plumbersoft Loss at an Airline Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Ease of Use 99% and up Impact on the customers’ decision Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset M “The project team went but the feedback I got on that was that on Plumbersoft; they came back with doubts.” Plumbersoft Win over Ant Hill and IBM at a state government department for $4M Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion Plumbersoft needs to create or strengthen its Customer Reference program Doing so should turn this from a reason for losing to a reason for winning. Weak references are endangering deals.

Getting Insight Win-loss Analytics – Price Reasons you Lose Reasons you win High Price Customer Engagement Customer Engagement Product Line Breadth Proof of Concept References Simulation Openness Losses Wins Vendor Viability Product Line Integration Ease of Use Impact on the customers’ decision Ease of Use 99% and up Vision 95%-98% Product Line Breadth Product Line Integration 90%-94% Price 85%-89% Proof Of Concept References 80%-84% Existing Skillset Vision < 80% Scalability Adapters Scalability Fill Color is Statistical Confidence Level Data Analysis Product Line Breadth 31 Losses 22 Wins Low Product Line Integration Adapters Unfavorable Customer Opinion Favorable Customer Opinion What about price? When all else is equal, price becomes the ONLY issue. Plumbersoft has ample means to build a sale around issues other than price. Inconsistent performance across field can indicate a field training issue.

From Insight to Action Summary Issues Examples Recommendations Strategic Strength Simulation Find segments who care and market to these people. Build thought leadership and brand around this. Strategic Weakness Product line breadth, Vendor viability Focus on segments that care more about strengths; close capability gaps Tactical Weakness Customer References Create or strengthen program Tactical Parity Customer Engagement Look to transcripts for best practices, and train field with examples of what works.

Action Win-loss and Competitive Sales Tools Use your win-loss decision criteria to guide the field. Show field how to control buyer’s agenda with strengths (win-factors) Help field counter weaknesses (loss factors) well enough to prevent defeat

Watch out for “Not Invented Here” Action Getting Buy-In Executive Sponsor Who has the money? Who has a broad, cross-functional view? Sales Leadership Ask for air-cover (letter to the field) Expect little else Product Management and Marketing Invite to field debriefs Regularly review win-loss insights face-to-face Win-loss quotes are great for sales training CEO Engineering Product Management Marketing Product Marketing Sales Field Enablement Watch out for “Not Invented Here”

Summary Plan and resource win-loss as on-going program Become known in your company as the champion of win-loss Find a sponsor willing to pay and interested in all facets of competition: product, marketing, field effectiveness. Interview customers and the field Blind, anonymous customer interviews give you unique, objective intelligence Field interviews will enhance insight, win confidence, and get the customer contacts needed for customer interviews Invite others to participate – make this a cultural change Invite functional executives to field interviews to broaden culture of continuous learning enhance program visibility Involve product management and marketing in analysis and preparation for executive presentation – prevent “not invented here” Present findings as high as you can. The CEO should be interested in what you discover.

Action Win-Loss for Continuous Innovation Landscape Analysis Competitive Positioning Sales Tools Field Training & Support Field Debriefs Win-loss Strategy Planning Feedback Tactical Support

Ken Schwarz Richard Case Eric Kuhnen Panel Q & A Progress Software Marketing Director Richard Case PSP Enterprises Win-loss Consultant Eric Kuhnen Focal Partners Battlecard Consultant