Customized Product

I have often wondered about the ridiculously low number of Software Products that hit the Indian market given that India is literally an unexplored and fertile market, just based on the affordability aspect alone. Going by the modus operandi of successful Product Companies abroad, there is no reason why Indian outfits cannot build and market world-class Products. In the article on 23rd September '02 titled 'Ensuring Software Product Success', we talked about the basic elements to be properly addressed for a Product to shine and become successful, and now we will look at the 'Essence' of a Product.

The Head of a fledgling Indian Software Company was not very enthusiastic about his Product business and I was fairly probing to find out the real reasons for his lack of optimism and drive. He virtually complained in the usual manner about the rampant Piracy and the 'immaturity' of his Prospects. And when asked about the Value Proposition of his product, his immediate reply was "Customization". His demeanor changed dramatically and his expressions grew very animated and excited as he started reeling out the capabilities of his team to meet any specific demands from a customer, starting with reports, to inclusion of some specific fields, new screens and even a slightly different business logic, if necessary. And he was feeling so proud that his team could accomplish and deliver all these within a very short time frame, for an additional cost and the Product can be even given away FREE depending on the scope for revenues from customization.

I felt like Archimedes and wanted to shout "Eureka !", but restrained myself. Here was the right answer I was seeking all along ! This gentleman, who is fairly an expert in software development, proved to be a novice when it came to the fundamental truth that a Software Product is one which is developed once and is deployed at several sites with the Same Code. In his opinion, so long as his piece of code had a nametag to it, it would magically and automatically become a Product, even if the underlying code was constantly getting changed at different sites of his customers. For him, his Product was only an entry point into a Client and if that was done, it will go through a mutation and mutilation process, at the end of which, there will hardly be any resemblance to the original code. And sadly enough, this did not actually matter much to him from the point of view of his business model ! On the contrary, he was thrilled at running a Product business, not realizing that he could be more successful with relatively lower efforts and overheads, had he chosen to implement the Product formula, in letter and spirit.

This is the stated position of very many Software Buffs, from the one-person outfits to the CEOs of highly respectable corporations in India belonging to the New Economy, little realizing their true potentials. Because they are fully ignorant of this most fundamental principle of a Product, they categorically declare at every forum that India is not really ready, if not suitable for off-the-shelf Products, and that Indian customers will not even touch; leave alone come forward to accept them voluntarily. I even heard a CEO swear that he is in the business of providing solutions and not packaged software, as if they both are mutually exclusive. And all along, he squarely put the blame for the failure of his 'Products' squarely on the ‘immature and unsophisticated’ prospects !!

I am aware of many Companies who perhaps understand this essence of a Product but in many ways still consider their ‘Products’ as a ‘skeleton’, which they are willing to go to any lengths to make it suitable for the end user. What they fail to realize is that there exists absolutely no end to customization at all. I am yet to come across a single customer or even met somebody who has, where the customer has drawn a decisive line on his requirements and said "enough is enough".

So; what is the final Solution to this ? It is high time that Product Companies take the initiative themselves to temper the expectations of the customers by offering a sound Product that would meet, say 70 % of their needs currently; which will increase to even 90 % over a period of time. In this process, these New Age Companies also have an opportunity to receive valuable inputs from their customers, which they can generously offer to all the users in the form of value-packed upgrades. Customers, who could well be considered as very lucky to get even a fit of 60 % over frequent ‘fits’ at very high cost and longer time frame in the customized application development mode, would wholeheartedly understand the benefits of this Product approach and welcome it.

By this route, the customization revenues of Software Companies no doubt will initially fall, but that will be more than compensated by a higher volume of sales spread over a period of time. Sales cycles now will also be shorter because the sales guys and the developers are no longer required to do a gap analysis to submit a proposal. Further, the members of the development team will have ample time to fix the reported bugs and build additional features, if any, in the subsequent versions so that all the customers get the benefit of their hard and creative work. With the shackles of customization being removed in more ways than one, Channels would now become more empowered and effective and as a result will be more productive in generating business in a big way. They can even be trained to install, handle user training and also provide effective first level support to the customers, which is rarely done in the right way these days.

So, by following this route; everybody turns out to be a 'Winner'. The Product Company gets more installations and thus higher revenue within shorter periods, the Channels earn higher commission with commensurately lower efforts, and most importantly, the Customer gets a ready solution at an affordable price with the added benefits of local support and quality upgrades.

Are the IT Professionals listening ?