Wednesday, October 21, 2009

Building a Product so that all Parties Benefit

Saw two similar complaints pop up on my iGoogle feed and makes you think about product design.

When you come up with a business model, you are trying to solve a need; if it's just "really cool" but doesn't solve a need for customers, then you might as well forget it. This product that's being talked about and labeled as "dumb smart meters" by Fast Company are the smart meters that have been installed in millions of homes by PG&E amongst other companies that sell similar products.

What the product has done though, is raise hell for customers that are claiming their fees have gone WAY up for no obvious reason (now we should note that these customers also neglected to realize that there were rate hikes in 2008 and March of 2009). The other twist is that the meter company did screw up and ended up having to pay back $240 million in fees.

Long story short, smart meters didn't achieve the anticipated objective of reducing energy consumption, instead its accuracy increased customer fees, generated a ton of complaints and caused a headache for the party that originally wanted to install it.

In this case the product obviously pissed off its end-customers, but keep in mind that there are other parties that you should aim to please (or at least don't piss them off). Think of your business partners (don't screw up your system integration), think of your internal staff (pissing off your operations or customer service people cannot do any good for your sales figures) and even your competitors (heard of something called retaliation or predatory pricing?)

So in a sense all of these parties matter because they are involved in the success of your business; make sure you keep all of these relationships healthy, and you are always trying to design your product so that there is buy-in at all levels - here's what I it so that:
  1. Customers will PAY for it
  2. Business partners will endorse it and promote it
  3. Operations won't have a headache trying to manage the day-to-day workflow (does your product make it easy for your ops people to make it work?)
  4. Customer service is actually providing customer service and dealing with hate mail from customers (if you can't make your customers love your product off the bat, at least don't make them hate it - like in the case of these smart meters)
Now to think about my own product strategy so it meets all the above criterion. Easy to say, hard to do! Good luck!

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