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Should you ever throttle back marketing?

Should product management and marketing have a throttle?The VP of marketing at an engineered products client recently asked me a great question. “If our constraint is the ability to develop new products, would you recommend we purposely slow the flow of new opportunities?”

Let’s look more closely at the situation. First, this company manufacturers highly customized OEM parts that often requires pushing the technology beyond its former limits. Second, every part is exclusive to one customer. Think seating for a GM car – while some of the technology might be the same, the seat itself could not be used in a Audi without wholesale design and engineering changes.

For a company like this, engineering and development is often the capacity constrained resource as far as bringing in new business. They can only sell what they can successfully get out of development, and companies like this often have far more opportunities than their development resources can currently handle.

With development as the bottleneck, the company’s first focus needs to be improving the use of this resource and then elevating it’s capacity. To learn more about how to do that, you can download a free executive briefing here or register for a more detailed, free whitepaper here , but in short that means:

  • Prioritizing resources to only the very best opportunities in terms of expected return per hour of development time
  • Investing in upfront work to determine feasibility of meeting customer requirements
  • Focusing resources on less projects at one time
  • Planning and managing projects with critical chain methods
  • Making sure that the rest of the organization helps or eliminates work for the constraint

So back to our marketing VP’s question. Should you ever purposely slow the flow of opportunities?

No, while opportunity flow into the bottleneck has to be managed, I wouldn’t recommend taking your foot off the gas. Let me explain why.

As you elevate capacity in development, you’ll start seeing new products move from idea to commercial reality in as little as half the time. With that new capacity, you will very likely need that steady flow of new opportunities because ramping-up marketing efforts, particularly direct and channel sales can take quite a while.

However, redirecting your marketing efforts to better define and raise the bar on what constitutes an attractive opportunity will pay big dividends. Without active intervention, 20% of the quotes we win will deliver 80% of the value and approximately 50% of those wins will deliver 95% of the results. That means that simply focusing marketing efforts on finding better, more suitable opportunities can easily double the value of what comes out of development.

Let us know what you think.

{ 1 comment… add one }
  • Loren Smith September 28, 2010, 11:51 am

    If by “marketing,” downstream marketing is intended as the topic, then there could be situations where throttling back makes sense inside of TOC (where merchandising and promotion is not the main constraint). On the other hand, upstream marketing is vital to stay connected to the customer (OEM or otherwise) and truly understand their full range of needs, even inside their own shop. By doing this the subject company can presumably charge more, last longer as the chosen supplier, sell ancillary products with greater ease, etc. Don’t forget that eventually, if not immediately, every company has competitors.

    Loren Smith

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