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The Services Solution Litmus Test

Ask the right questions before going ahead.

• By Phil Aldrich
• March 01, 2007

These days, building a services solution business is an imprecise science. In the past, service delivery was straightforward: Integrators serviced a stable customer base exclusively for a software or hardware provider committed to the integrator's product. Today, product companies may compete with integrators and other customers, while mergers and acquisitions have changed the IT landscape-all of which requires integrators to make tough choices about which solutions to market.

Currently, the landscape is filled with great ideas. But with all that competition and consolidation, it's increasingly difficult to identify the best markets for them. Fortunately, there's a litmus test for selecting service solutions that will help differentiate your company, build customer loyalty and

ultimately drive new revenues.

Asking the Right Questions

Solutions should, of course, enhance both your customer relationships and the products and services that your company sells. In addition, it's important to remain focused on achieving every integrator's primary goal: helping clients achieve their business objectives. With these thoughts in mind, it makes sense to ask two fundamental questions before actually beginning the time-consuming process of developing solutions:

1. Do we already have expertise in this space? Sometimes good ideas fade away because they aren't central to a company's core business. But that's not necessarily the best resolution. In a December 2003 Harvard Business Review article "Growth Beyond the Core," Bain & Co. growth experts Chris Zook and James Allen reinforce the importance of protecting a company's primary competencies. But they also say their five-year study of corporate growth indicated that the most successful companies outgrew rivals by staying within their core businesses and, at the same time, developing formulas for expansion into complementary areas. For example, establishing a division for government customers or developing a service that enhances an existing product are ways that you can build on your company's existing expertise, filling a void without risking your core business.

2. Will it either reduce costs or make money for customers? Today's integrators succeed by helping customers either reduce costs or increase revenue. Being certain that a solution offers added value is a smart route to that success. Start by using your customers' needs as the basis for development. Sounds obvious, but, in fact, few of us are willing to look at our solutions in this light. But doing so will make it easier to sell and deliver to your customers.

Examining such questions will also help you shape your solutions to each customer's needs. If you can answer the question of how a solution reduces the customer's costs, it's fairly easy to identify exactly where those cost savings are located. And if you can differentiate between hard and soft savings, you can build a business case that helps you sell a solution based on value-one that the customer can justify internally.

Building a Business Case

For an integrator, growing a solution based on the ability to answer the aforementioned questions means you'll have a ready-made business case for your market. It's no secret that test-marketing programs and pilot implementations tend to be more successful when you have the business case nailed. Developing a solution first and then addressing the market is, more often than not, a painfully slow process at best.

This simple litmus test can begin the process of solution development on the right track. Is this what we do? Will it save the customer money? Will it make the customer money? These questions invariably lead to a great solution if the answer is yes. If you can't answer these questions affirmatively, then you're setting yourself up for failure.