SaaS Startup Thinking: The Dynamics of Strategy and Practice

Over the weekend, I talked with a SaaS company founder about his confusion and challenges. I got a lot of inspiration in addition to ideas.

The topic of this discussion is abstracted into one sentence: What should be the interaction between strategic decisions and real-world results?

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Let's talk about it through concrete cases.

I.The selection of the target customer group

This SaaS company has two customer groups, A and B. There are some differences in their needs. There are still some differences between the needs of the two, and the resources of the product research and marketing department are limited, so it is impossible to do two markets simultaneously.

From the current product accumulation, it is more suitable for the B customer group. However, from the perspective of the founding team's network resources and experience accumulation, there are more opportunities in the A segment. How to choose the first niche market?

Strategically speaking, it is wrong to choose A and B simultaneously. But practically speaking, A and B must both be touched before we can know who is in the right niche market.

In fact, because of the customer resources on A, even our standard of "pay is true love" may be blinded.

The good thing is that SaaS products have "activity" to observe. Then we can combine the activity data with customer interviews to understand the depth of customer usage.

Finally, we can use the results of the actual battle to guide the strategic positioning. After firming up the strategic positioning, we then use the strategic positioning to require that the actual battle focus on the A (or B) niche market.

The strategy is determined only after the actual battle is first; after the strategy is selected, the direction of the real battle is firmly established. This is the first case of the relationship between strategy and actual combat.

II. The critical industry exploration

I once made a big mistake in exploring the industry.

When the CRM sales team of more than 100 people, I did a deal customer industry analysis and found several industries with a good number of customers. After communicating with the top and bottom, we decided to set up several industry groups, and each group was only allowed to do customers in entire industries.

This strategic choice is essential because, as a cross-industry general tool SaaS, it is very important to show customers solutions with industry attributes. Focusing on industries enables sales students to improve their knowledge of industry customers quickly; it is easy to precipitate high-quality industry solutions (including PPT and very time-consuming industry product demo demos).

This strategy comes from the real world and also uses the activity data of SaaS products. But the "iteration" was missing.

To keep the sales students focused on the industry, I had a rigid industry development policy: industry teams were only allowed to develop customers in their industry.

It just so happens that the team's execution is superb, and my authority is too high (Versailles a handful). Every time I ask a few directors about the progress, they tell me to guarantee the task! Almost a single!

But 3 months later, the performance did not come out, sales students were in the hands of non-industry customer resources and had been released to other colleagues, the entire team morale was steeply depressed, and the industry strategy ultimately failed.

From this lesson, we can see: even from the real-world strategy, the implementation still needs continuous testing in the real world.

The only way to find the truth is to have the strategy and battle corroborate and spiral upward.

III.The difficulty of decision-making: the balance between firmness and flexibility

Then someone may ask, how can strategy execution not be committed? The team leader himself is not sure of things but still can expect team members to take their future and the customer resources on which they depend to attempt.

Will it be necessary for the senior management to ask everyone to implement and constantly observe the adaptation method resolutely?

I think traditional companies can use such a way, but Internet companies should still uphold the principle of openness and transparency. Whether it is the recruitment of "dead soldiers" in the early stage or the process of supervision, we need to make clear the belief of doing things: we only know whether the road is open or closed when we give it our best.

Just like in the ancient army, the general officers did not tell the team members the purpose of the march, the quality of the personnel was too low, and strict implementation could be. Still, the modern army is different. From the chief to the company, everyone is clear about the purpose and meaning of the battle. The front line has a sense of mission and flexibility, and the team has more combat effectiveness.

So the leader's difficulty is much more significant: a task with only a 30% success rate, but also to convince everyone to do it.

I concluded that there are several methods.

·Only let the skilled and expert person come down to the field (maybe the CXO himself) and lead everyone to explore "co-creation."

·Be open and transparent, set SMART digital goals early on, and keep talking in numbers.

·Regularly review the achievements and failures together, and constantly iterate the method.

·Set up a longer-term assessment mechanism, not judging by the success or failure of the experiment

·Develop people for training rather than just pursuing experimental success

On this last point, I recently read an article by Gan, "Gan Jiawei: High-level operation is not just doing things, but also leading people". What was the biggest gain of the "Hundred Group War" of Meituan? We can see that it is not the performance of the group, but the group of people who have worked out:

There are good at strategy.

There are good at operation.

There are good at ground marketing.

There are good with the team, which is the American group, later to do take-out victory and upgrade to an enormous battlefield of the basic plate.

So test failure is not terrible. Hammering out an excellent and resilient team is also a success.

IV.efficiency and innovation: changes and changes in the business

The goal of efficiency improvement is a slight increase (30%~), shaping standardized processes and accumulating best practices under a relatively stable environment and target. The goal of innovation is often a tenfold or hundredfold growth, a big step up; although there are risks, the prospects are promising.

Both efficiency improvement and innovation require organizational support. Early reliance on the core team's ability and combat power is sufficient; the company is big enough to require superb corporate collaboration. Otherwise, they are mutually constrained and cannot break through. The first step of innovation is learning, through learning to understand customers, understand the environment and align cognition, so we emphasize building a learning organization.

To sum up into one sentence: strategy comes from the actual battle, the system guides the real struggle, and the actual battle must firmly implement the strategy; at the same time, the strategy is only the direction, and the true struggle needs continuous feedback to iteratively improve the accuracy of the strategic direction. This is the dynamic relationship between strategy and actual combat.

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