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Problem Focused Growth

by David Brock on April 22nd, 2021

I wrote about Product Led Growth. It’s the latest hot new strategy being promoted by many SaaS companies and VC’s. It’s not a new strategy, we’ve seen it so often in the past, companies with Hot Products focused just on fulfilling customer demand. In past decades we’ve seen both the pros and cons of product led business models.

In the article on PLG, I focused on some of the promise, as well as the problems/challenges with this business model. It’s ironic, as we reflect on this, the problem with so much of our go to customer strategies is that too many have adopted a product led strategy–even though they don’t have a hot product.

The perennial problem we face in effectively engaging our customers is that we focus on what we are interested in–our products/services–and not what the customer cares about.

What if we changed our point of view? What if rather than focusing on our on priorities, we focused on the customers’? What would happen if we adopt a Problem Focused Growth Strategy?

What’s this mean?

It’s simple, we move our perspective from our products to the customer problems and challenges. This is easy to say, but what does it mean? Some thoughts:

  1. We have to have great clarity around the problems we are the best in the world at solving. These problems define our products and services. These problems give us the context in which we deliver the most impactful value to the customer.
  2. We have to have great clarity about the customers that have/are likely to have those problems. Can you spell ICP? We are the most relevant, we create the greatest value, we are more successful with our customers and in achieving our own goals with those customers. We waste time and brand equity, when we try to engage customers outside our ICP.
  3. We have to recognize that our solution is likely to be just a part of the broader customer problem. So our solutions may be a component of that problem. We have a couple of challenges we have to address in this space: First, what part of the problem do we help them solve and how does that fit with all the work they have to do? Second, how do we help the problem solving team successfully solve the problem? (The data on project failure within customers is stunning.)
  4. We have to recognize that being problem focused rather than product focused, it changes our engagement strategy and the skills needed to create the greatest value with our customers. This demands different skills and engagement models. In addition to product knowledge, we have to have critical thinking, problem solving, project management, orchestration, collaborative conversations, and curiosity skills—because those are skills critical to problem solving.
  5. We have to recognize the tremendous advantage–from a growth point of view—that the problem solving orientation has over the product led growth has. In a PLG strategy, we are dependent on the customer recognizing they have a need to buy a product. With a problem focused strategy, we have the opportunity to get the customer to think differently. They may not know they have a problem, they may not know how to begin defining and solving the problem. The number of people having a problem versus the number of people recognizing they have a problem and buying a product to address this, is orders of magnitude different. Why should we be satisfied with the growth produced by people who recognize they need to do something and have selected our product? Shouldn’t we be addressing a much greater market opportunity by working with people who have the problem, but don’t recognize it or are struggling to solve it?
  6. We create the greatest value and differentiation by helping our customers recognize and solve their problems. We create the greatest value and differentiation when we help them in the change process. Product led strategies actually minimize this value creation and differentiation because the customer has done all the heavy lifting. We know in every Hot Product driven business strategy, the greatest threat is the fast followers, those competitors that copy, or improve upon our product/solution. We have the greatest opportunity to sustain or accelerate our growth.
  7. A problem focused strategy makes it easier for us to win. In reality, it is never about the product, but about solving the customer problem. As we look at most customer buying processes, any of the solutions on their short list will solve their problem. We discover, it really is never about the product, but what we enable the customer to do and how we help them learn and do those things. A product led strategy is solely dependent on product superiority. Over time, this is unsustainable, both from a competitive point of view, but more importantly, from the customer problem solving approach.
  8. Problem focused go to customer strategies don’t need Hot Products, they are only dependent on our ability to actually help our customers discover and solve their problems. There are very few organizations that actually have the ability to develop and sustain Hot Products. But all of us can and must focus on helping our customers solve their problems. And the degree to which we can do this, creates a greater and more sustainable growth strategy.

I’ll stop here. PLG has become the latest shiny object diverting too many of us from focusing on the basic principles of creating value with our customers. It’s easy to understand the VC attraction to this–companies with Hot Products are great investments (during the upcurve).

While it’s not flashy, I believe the most sustainable growth strategy is about Problem Focused Growth–with our customers.

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  1. Brian MacIver permalink

    Great Article Dave, an interesting Start to the week.

    Product led, Problem led, Solution Led, Value led, if we Gantt Chart them they OVERLAP, but definitely do not form a single circle.

    I guess I have used ALL four over 40 years,
    and for the last 20 years Taught ALL four.

    Rackham’s SPIN(r) work of identifying Sales Behaviours allows us to identify which approach the Salesperson is taking. The Product led Salesperson will move speedily to Product description. Features, Advantages, and ‘benefits’. I write ‘benefits’ as its unlikely in their speed to product they Identified any expressed NEEDS of the buyer in their RUSH to Product present.

    That is not to say Product Led is ‘ineffective’

    Working with EMC, in the 80’s, we simply asked permission to install ‘extra’ memory cards in the Customer’s System 38. An instant performance improvement resulted. A week later we switched the extra memory off, let them run slow for a day then CLOSED, buy or lose the speed. It was highly successful.

    Of course, we could have trained the Salespeople in System 38, Memory Stacks impact on Performance, SPIN(r) technique, greatly lengthened the Sales Cycle, ending in a Value Presentation of Paybacks & benefits. That is precisely what we had to do when selling other PCM equipment like CPUs, Disks, Displays and Printers.

    So, what counts?

    Sales Strategy is EMERGENT, we need to adapt PRAGMATICALLY to what works. So, each organisation will need access to diverse capability which can adapt to their Product/Market. The minimum is the Behaviour Analysis, the MEASURE what works, and what doesn’t work.

    Edison didn’t invent the light bulb from repeated FAILURE,
    he just got it RIGHT once and could repeat what he did.

  2. Brian MacIver permalink

    One of the less taught limitations of SPIN(r), but freely admitted by is its author (Neil Rackham), is the Negative effect of OVER Problem selling.

    This occurs when a Salesperson gets on a roll with Problem and Implication questions. They know that Problem Discovery and Development will drive Change & overcome status quo complacency. They just don’t know how to confirm with the customer when enough is enough.

    You do not need to take them to losing the war,
    just because a Horse lost a shoe nail.

    I have seen, in joint Behavioural Analysis calls, where the less sensitive Seller ‘beat’ the Buyer with their Problems, then left them to stew. Buyers do NOT look forward to your next visit!

    Or the salesperson who superbly identifies the Key Problems, fully explores the implications, and expertly highlights the URGENT NEED for change, then admits THEIR PRODUCT cannot resolve those Problems.

    Problem based selling requires great Skill. 😉

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