Susan Williamson’s company has been doing what it does for 37 years, and doing it well. But until recently, she probably wouldn’t have been able to articulate what that was.
Before the president of C.TRAC information solutions could launch a new niche product also known as a vertical within her existing industry, she had to be sure about her core competencies. She knew that C.TRAC specialized in direct marketing and database solutions, such as data entry, hygiene and analytics. But her analysis revealed the sweet spots that she could dig into to reap additional business and future success.
Now, that’s a regular piece of her corporate communication.
“As long as I’ve been here, we’ve been sort of lazy about communicating our value proposition for our core business because at some point, you just think that people know,” Williamson says. “It seems like we’re much more diligent about the value prop to our new vertical because you have to be.”
In order to do that, she needed a keen sense of balance. Through all of the steps evaluating the core, securing internal buy-in, branding and, ultimately, taking the vertical to market she had to weigh the new offshoot against its parent.
Williamson leverages the legacy of C.TRAC to build the credibility of the new product, IQSystemix, by including “powered by C.TRAC information solutions” under the IQSystemix logo.
While that connection is crucial, Williamson must also maintain the vertical’s separation through a unique Web site, a specific core and a distinct target audience.
“It’s so easy to fall back into talking the way that you’ve talked for 37 years about what you do,” she says. “One of the things that can really go wrong with this is that you don’t have enough discipline within the new vertical to keep verbiage and value proposition and staff and everything that you need to keep separate, separate.”Evaluate core from outside
Before you build an offshoot, you must decide which direction to shoot and why. That starts with understanding your company’s core competencies. You may think everyone already knows so you don’t need to analyze it, but it’s worth the extra effort.
“When you’re trying to articulate that in a new vertical, it’s pretty difficult because we’re so close to what we do. We’re almost too familiar with it,” Williamson says. “Sometimes a staff addition or a consulting voice from the outside even if they haven’t had significant exposure to your new vertical helps because they don’t have that legacy context problem that they can’t remove themselves.”
She began by bringing in Matthew Holz, a former consultant, to serve as product manager of the new vertical and to balance the two crucial roles: student and expert.
“It can be pretty tricky because we are there to educate ourselves about what we’re trying to do, but you always want to continue to appear the expert because you do want to grow your business, ultimately,” Williamson says.
Holz began educating himself by looking at qualitative data such as key metrics, historic business trends and information about competitors. He watched for upward trends in offerings and markets that would be conducive to future business.
After he saw growth in database building and management, the health care market was a natural choice. Because the American Recovery and Reinvestment Act of 2009 offered incentives for hospitals to invest in advances, many hospitals were already buzzing about electronic medical records. Plus, it was a field with few competitors.
It’s crucial that your competencies are the starting point for locating growth opportunities, rather than vice versa.
“You can’t identify that there’s a problem and design a product around it because that particular strategy might be outside of your core,” Holz says. “What we needed to understand at first was: What do we do well and where are the growth markets?”
Once you identify the prime markets, you can zoom in. Interview customers there as well as your employees who work with them to find out what your company does best and how it could do better. Those conversations will also help identify the decision-makers you’ll need to reach.
“You need to understand the hard and soft aspects both qualitative and quantitative aspects of that vertical,” Williamson says. “You want to know how they buy and at what level within the organization, who they might be buying from, who the other perceived competitors are of yours. You really have to become familiar with the informal centers of influence within that market.”
Holz compares the interviews to a traditional sales process in that you don’t want to come in with all the answers.
“It was not saying, ‘C.TRAC offers you this,’” he says. “We took a step away from that and said, ‘If we were to start again and we looked at the way that you manage your data, what is important to you as you look to execute?’ The biggest thing was asking them what their biggest challenges were.”
He realized C.TRAC was providing redundant database services for multiple departments within hospitals. It’d save time and money on both sides if C.TRAC extended those services across the enterprise. And the vertical was born.
Your goal through this research is determining the vertical’s feasibility through a combination of financial and strategic planning. That includes setting a profit timeline with return on investment calculations as well as planning resource additions in terms of staff and technology.
But don’t forget about the big picture.
“As we’re benchmarking this new vertical to our core, how is it helping our team to progress to our goals, not only in terms of sales contribution or margin contribution,” Williamson says. “But are we growing our competencies in the areas that we had said are going to lead us to growth?”Sell it internally
Before you launch outside, you need everyone on board inside. Building that buy-in is a process that continues throughout the life of the vertical.
Early on, it means talking to your employees about their scalability to expand certain services. While he interviewed customers, Holz also interviewed some of C.TRAC’s 40 staff members to learn their strengths and growth potential.
“As we targeted what the core competencies were, it was looking at the talent we had in here and the direction we could grow the talent that’s out there,” says Holz, who discovered strong backgrounds in database design.
Especially in this economy, it’s important to keep employees apprised of their roles as the vertical unfolds. That requires communicating your direction.
“One of the biggest mistakes is companies move forward but they don’t clearly explain to the staff why they’re doing it,” Holz says. “They need to understand that when we come and ask you for assistance, this is something we’re doing for the progression of the company and you’re an important piece of it and this is why.”
Maintaining buy-in means maintaining transparency with everyone, whether they work directly on the vertical or not.
“You have to be transparent to them in what you’re trying to do,” Williamson says. “You have to talk the value prop internally almost as much as you do externally. You have to be able to translate to them how we’re using our tools within the business to service this new market. They need to understand why you’re doing it, not just in regards to the internal utilization but how is that going to help us to attain our financial and growth goals.”
Williamson provides metrics to track those goals, such as how many executives she meets with and how often and what comes of the encounters.
“It’s all about the small successes and making sure that they understand those even if they aren’t sales,” she says. “[Show] metrics around how many phone calls does it take to get a meeting and how many meetings did we have this week.”
Holz suggests voicing the vertical’s progress and challenges in regular staff meetings. That setting will also reveal who’s on board.
“You can tell they get it when they’re coming to the table with ideas, they’re engaged in what you have to say and they’re coming to you saying, ‘This is what we think we can do better,’ or, ‘Hey, nice job on that,’” he says.
In a small company like C.TRAC, keeping everyone equally informed will prove crucial when you pull employees into the vertical for assistance. If you’ve built the vertical from the company’s core, they won’t have to switch gears entirely. Plus, their perspectives will only help.
“One of the biggest problems leaders have is tunnel vision. They think they have all the great ideas because they’re so close to it,” Holz says. “Someone that’s working in an entirely different piece of the business is going to come up with a question that may make you think about it differently, and that’s where growth and innovation happens. A good leader is able to launch that vertical and make the surrounding organization better because you’re using all those resources for it to be successful.”Take it to market
Some say after you get internal and external feedback, you create the value proposition. But Williamson argues that the two steps happen in tandem.
“You never have a finished product,” she says. “It’s really a complementary process that you’re going through discovery and introducing your expanded services at the same time which is really tricky.
“That’s another reason why a dedicated staff person that’s outside of the core business is really helpful. It’s important that that person isn’t perceived as a selling force at that point of the process. They’re not there to jam anything down clients’ throat. They’re just there to learn and tell people about our ideas and be really transparent about it.”
Holz calls the process soft launching, because as he pitched ideas, he was still open to suggestions.
“We wanted to reach out to those that were already doing business with C.TRAC and give them the idea of: ‘As we evolve this plan, does it make sense to expand it to other departments?’” he says. “‘Where do you see gaps we could fill? How do we make your lives easier?’”
Early on, you can calculate customers’ ROI by pulling from your company’s data that relates to the vertical and shows how you’ve already helped customers in that realm. Williamson used savings calculations and testimonials from other data quality projects.
Eventually, you have to show proof of how the new vertical can help the client specifically. Seeing is believing, at least when it comes to building buy-in, so Williamson offered free samples to potential clients called a patient data quality analysis (PDQA) to show what their benefits would look like.
“A C-level person doesn’t really understand the intricacies, but they definitely understand the savings,” she says. “Until you’re able to show them the ROI calculations along with your analysis specific to their data as opposed to a hypothetical, that’s really [when] they know what we’re talking about.”
Of course, you could go on researching forever. Williamson says the time to launch is when you feel confident that the value proposition will score at least some appointments and ultimately some deals.
At that point, start building a presence in the market. Holz reached out to centers of influence within the health care industry, targeting events tailored for that sector and publications that speak to his end users.
“You have to target your approach to those that buy your product,” he says. “It can’t just be, ‘We’re going to put a booth up because there’s a lot of people.’ You want to make sure you’re focusing your efforts on the highest probability of return, and it is understanding who your buyers are and being able to give your value proposition to them in a way that speaks to their needs. … Companies put too much on how great they are, but the value proposition has to be shared externally as needs-based.”
The branding should speak to those needs, and the more specifically it does, the better.
“We want the vertical to speak to the users,” he says. “We want it to be that we work specifically within your vertical with a product that’s just for you. We understand your needs; we understand where we can fix any of the problems you have or deliver value to meet your needs, and that’s exactly where we reside.”
Even the name should directly reflect your end users. C.TRAC looked into clinical terms that would jive with health care professionals and landed on a variation of “systemic,” which also indicated the vertical’s systemwide approach. When paired with “IQ” for improving quality obviously with a nod toward intelligence they had IQSystemix.
But launching doesn’t mean you stop listening to input.
That constant give-and-take is easier in this digital age because you can continuously update your offerings online as opposed to reprinting thousands of catalogues every time something changes.
“That’s what I think is very important is that ability to both know what you’re trying to accomplish but also to be flexible,” Williamson says. “It’s not the real world when you say, ‘I’m going to get this product or service ready and then I’m going to launch it into the market, and those are going to be two independent steps and they’re going to go in that order.’ It shouldn’t happen that way because you can’t optimize the offering without the input of relevant parties. … That learning process is really part of the launch, and if you wait until it’s ‘done,’ you would never do it.”
How to reach: C.TRAC information solutions, (440) 572-1000 or www.ctrac.com