The global pandemic has definitely accelerated the need for ISV’s to jumpstart their digital transformation journeys and compress decades worth of much needed change. To achieve growth in this environment, ISV’s are increasingly going beyond quick fix initiatives to leverage multiple value creation levers and capitalize on digital transformation opportunities. A growing number of ISV’s are now increasing their focus to accelerate product modernization, invest in product line expansion, and drive ongoing innovation by enabling an influx in engineering talent.
Throughout the pandemic Persistent has been at the forefront of working with our clients to build and execute innovation agendas. We have worked with a range of organizations from well-known multinationals like Intuit to smaller but equally innovative organizations like Fusion Connect and One10 to build critical experience. With this background, we are summarising how ISV’s of all sizes and complexity can develop new, innovative, and effective value creation strategies.
1. Product Roadmap: Moving away from the obligation to say “yes”
There is a misconception that being customer centric means delivering whatever the customer asks for. Sure, this attitude can serve some customers. Yet, it is not serving the larger ecosystem of customers and by extension, the future prospects. In many cases, the best intentions towards customization can actually undermine future roadmaps and saddle the organization with commitments.
To help address this, many companies are harmonizing sales and engineering teams to jointly build a product roadmap while understanding the pros and cons of going after certain features/functions.
2. The paradigm is changing from cost control to efficiency
There is a new theme emerging while working with companies at all stages of their lifecycles. What used to be a cost-takeout discussion focused on optimizing financial performance, has changed to an efficiency discussion. And while ‘efficiency’ is just another word the implication is critical.
On a recent panel, one of our panelists summarized the importance of efficiency well. He said, “When you focus on efficiency, what you are saying is that I want to make you more agile…I want to declutter all of the clutter you have that’s costing you money and is not creative from an ROIC standpoint. So, are you being wise about how you’re deploying capital? And that means human capital, it is working capital, it is cash, it is all forms of capital. “
This leads us to one simple question: is your organization being wise about how you are deploying capital? And that’s capital in all forms – human capital, working capital, cash, etc. When you pose this question, it shifts the lens.
3. Measuring run vs build
It is a common pattern across companies of all sizes to spend far more on run activities than build activities. While there is no shortage on the build pipeline, the problems are the clutter and inefficiencies in a run that are constraining how much money organizations can spend on innovation and growth.
Smart organizations are able to measure their run vs build activities to understand the ratio. They set thresholds and the manage performance rigorously. Through this discipline, they learn how past decisions about areas like product roadmaps and customization can end up hurting your long-term ability to invest in build and innovation.
4. Refreshing your talent
Talent is ascending to be one of the most important growth levers for any organization. While the challenge of accessing quality talent is well known, it can be a mistake to resist change.
Many organizations are afraid to upgrade talent in fear of losing the knowledge base that exists with the current employees. Yet new perspectives are critical for any company seeking to make the leap. Refreshing the talent pool can prove a valuable tool to powering through issues that have traditional held the organization back.
5. Diversity is no longer optional
Younger generations are defining the next 50 years of business. With growing levels of awareness & sensitivity, this generation will not join organizations that do not look like them or reflect their personal values. As said by one of the panelists on a roundtable I recently attended, “the days of showing up at new business development pitches with a non-diverse team are over.”
When hiring, it is important to focus on diversity. It’s all about how finding places with the best talent that is also diverse.
Ultimately this leaves two kinds of companies – those that are ahead of the curve and those that are caught flat footed.
At Persistent we have a deep understanding across areas like product modernization, roadmap development, and talent augmentation to enable value acceleration. Visit our Digital Product Engineering page to know more.