Price of Distraction

Over the weekend, I was telling the story of Informix (now part of IBM) and the number of databases it tried to market and sell. At one point in time, Informix marketed the following databases:

• Standard Engine (SE) /OnLine 5 / IDS 7 / IDS 9 /RedBrick

It then aquired Ardent Software and added two more databases, UniVerse and UniData. While the company was looking to build a data warehouse focused organization, the database was taking less and less focus. There were a number of problems the company was facing.

• There were not enough people at that time who could sell the complex technology well
• The market was not really ready for the high end product
• Each change in leadership elevated a different product to the forefront
• A confused customer base
• A skillful competitor in Oracle
• A little SEC troubles

Informix itself is a great case study. At one point, I simply asked the question “what if we sell OnLine 5 and SE to remove the distraction?” Both OnLine 5 and SE were great products in their day, unfortunately those days were long past. Both products still did somewhat well in the VAR space and were highly profitable the late 90’s. My rationale was that we only …

Over the weekend, I was telling the story of Informix (now part of IBM) and the number of databases it tried to market and sell. At one point in time, Informix marketed the following databases:

• Standard Engine (SE) /OnLine 5 / IDS 7 / IDS 9 /RedBrick

It then aquired Ardent Software and added two more databases, UniVerse and UniData. While the company was looking to build a data warehouse focused organization, the database was taking less and less focus. There were a number of problems the company was facing.

• There were not enough people at that time who could sell the complex technology well
• The market was not really ready for the high end product
• Each change in leadership elevated a different product to the forefront
• A confused customer base
• A skillful competitor in Oracle
• A little SEC troubles

Informix itself is a great case study. At one point, I simply asked the question “what if we sell OnLine 5 and SE to remove the distraction?” Both OnLine 5 and SE were great products in their day, unfortunately those days were long past. Both products still did somewhat well in the VAR space and were highly profitable the late 90’s. My rationale was that we only made $10 million a year on each and most of that was profit. We were shooting for the $1 billion plateau in annual sales and a $10 million product was a rounding error.

At the time I was the product manager for all of the legacy products, which accounted for approximately 50-60% of the companies revenues. I answered enough requests for OnLine 5 and SE to understand that they were a distraction to the sales force.

Going back to the Seth Godin blog on “don’t sell to bar owners” this is a perfect example where the sales force was not equiped effectively enough to sell the product line. And most importantly, the customer was confused into what they needed to buy.

• Is your product strategy consistent and in line with customer needs?
• Can your sales and marketing teams, concisely explain the positioning of each of the products?
• Does the customer get what they need, or what the sales rep wants to push?
• Do sales compensation plans align with customer need?

In the end, the lack of performance resulted in the company being acquired by IBM. All companies reach stall points, make sure your don’t create your own stall points. And if you do, recognize your actions and work to minimize the distraction and inconsistency.

Posted in Communication, Innovation, Operational Performance Management Tagged: Client Value, Communication, Focus, Inconsistency, Marketing Performance, Sales Performance, Simplicity

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