Is it real? Can we win? Is it worth it?
One of the best opportunity planning and decision-making frameworks I’ve ever come across to help teams think through big business decisions like whether to launch a new business, introduce a new product or expand to a new market is this simple, three question framework:
Is it real?
Can we win?
Is it worth it?
The beauty of this framework is that it ensures focus on core issues and works in large and small organizations and in just about every business sector. I first used this framework to guide business planning at a critical juncture when I was Director of Global Marketing for the ARL division of Bausch and Lomb. I’ve been a fan of this approach ever since and have relied on its deceptively simple formula in guiding decision making in many dozens of situations since. In fact, it’s my go-to approach when advising any company on go-to-market planning.
How did I get hooked?
Years ago, I had just become head of global marketing for Bausch and Lomb’s Applied Research Labs (ARL), a name which was a bit of a misnomer. This division, which had two thirds of its business in Europe, was in fact a maker of sophisticated analytical instruments. (Xray fluorescence, Optical Emission, ICP and electron microscopes.) It had R&D engineering teams in Los Angeles, Switzerland, France and UK. We added one more team in Canada on my watch. Multiple product lines came from these locations, and not a few redundantly.
Even though they had been in business since 1935, they had not ever had a specific marketing function in place. I was hired to create a marketing team and go-to-market strategy. The motive was to create growth in a division that had been stagnant for too many years. That meant putting in place product managers, marketing communications and market research. Part of the challenge was to rationalize what we designed and manufactured in some kind of business-logical order. These engineering teams came under the ARL banner through acquisitions and were habituated to competing with each other rather than rational collaboration to grow the business.
I needed a methodology to evaluate many competing proposals from these creative teams and help the leadership to identify our best prospects for growth.
I came across a workshop program that was founded by Schrello and attended the program for a day. There I learned the three-question framework: Is it real? Can we win? Is it worth it? The methodology seemed very orderly and logical and enabled adopters to create their own opportunity filter system that if universally adopted would level the playing field of heavy-handed political influence and enable us to select opportunities on their business merits according to criteria the leadership team would publish to all teams, ahead of any submissions. The methodology was also explained in a 2007 Harvard Business Review article that I would highly recommend if you are looking for a deeper explanation of the approach. It is well worth the read.
But here it is in a nutshell:
Is it real?
Is there a marketplace want/need for a product like this? Is it large enough for our business? is it growing fast enough to meet our leadership-defined criteria?Can we win?
Do we have what is needed to win? Differentiated product, sales team, support team and funding. How do we compare to competition? Are we ready to scale?Is it worth it?
When we add up the costs of all we have assessed is needed to win, do we project an ROI that makes it worth it vs the risks?
Using this methodology and model at Bausch and Lomb helped to focus teams and resulted in each location specializing in products that would be sold globally. It also freed up resources to attempt more innovative products using new technology.
The approach was transparent and helped to partly depoliticize our investment choices. I say partly because there is always lobbying involved but we now had a common language, a common way to evaluate, so we could all “compare apples to apples.”
One key decision that we facilitated with this framework was, after seven years of R&D research on ICP (Inductively Coupled Plasma) instruments, should we write it off? Or launch it? And, if yes, how?
Not only did we use the framework to decide, we also then used it to present to the Chairman of Bausch and Lomb, who at that time was Dan Schumann. We did not know his appetite for risk so we prepared eight different scenarios, from divestment all the way up to an aggressive launch and acquisition to accelerate time-to-market. To make each scenario real, we built financial models with Montecarlo risk analysis to see what they told us about the risk vs. reward.
We found out what his risk tolerance was when he chose the most aggressive scenario we had conceived of.
Here is how we analyzed and developed the plan.
Is it real?
There was no question in our minds that there was a need for ICP spectroscopy as it was a breakthrough in liquids elemental analysis. That had been dominated by an Australian CSIRO invention, the atomic absorption spectrometer (AA). AA could measure only one element at a time and with a non-linear output meaning onerous ongoing calibration work. ICP could measure tens of elements at a time in a couple of minutes and was linear over orders of magnitude of measurement. It was a more costly instrument but the cost per “determination” was far lower than Atomic Absorption. So for users who did a lot of such measurements, and perhaps would do more if less costly, this was a hot technology breakthrough.
Up to this point ARL was solely focused on solids-elemental analyses. We would face Atomic Absorption market leader Perkin Elmer and two contenders Instrumentation labs and Varian Techtron, all three with well-established sales teams that spoke fluent “liquid elemental analysis.” ARL’s team did not.
So “Can we win?” became a discussion about our go-to-market and how we could overcome the three market leaders’ hold on this segment. We conducted a survey of users of AA and received a staggering 30% participation rate, which rate told us that this was a hot market. Their incentive to respond to a very lengthy survey was a wall chart of the periodic table showing the wavelengths for each element that were relevant to ICP analysis. It told us that Perkin Elmer was known to over 90% of responders and they rated them #1 in the market. ARL was known by 30% and it was seen as #4.
Armed with that analysis we devised and launched a global campaign that was highly successful. How we did that is for another blog posting.
As the Bausch and Lomb story highlights, the “Is it real? Can we win? Is it worth it?” framework is versatile enough to address complex business situations while at the same time focusing business leaders on core questions that should guide big business decisions. If you are considering a new business or product launch, I highly recommend taking the time to evaluate your options using this methodology. I’ve facilitated many workshops with this framework and while it doesn’t always result in a “go” decision, it reliability focuses leaders on risks, rewards and readiness and leaves them confident they are making decisions based on a sound assessment and thoughtful process. The rigor helps with building internal consensus, support and enthusiasm.
