There are only two revenue problems

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There are only two revenue problems

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I have a confession of sorts to make. It took me over 30 years to learn that there are only two problems that a firm can encounter in the pursuit of customers and revenue: figuring out how to seize the opportunity at hand, and how to stop a freefall. It is a game of Snakes and Ladders often played on a global scale, and sometimes lacking any enjoyment whatsoever.

Everything else – share capture, new product introductions, sales enablement, margin erosion, excessive churn, and hundreds of other descriptors – are variations on these two themes. Always. Without exception. The variations are important to be sure. Yet, the variations can make it difficult to clearly see the shortest pathway to opportunity or problem.

What is harrowing is that one or the other can be masked, disguised as something it’s not, and confusing management at the expense of precious time.

Is a technology leader that rapidly introduces new products or models on the growth path? If the aggregate revenue decline of existing products is greater than the upward slope of new ones, then it is in fact in freefall.

Do declining revenues indicate a freefall, with no reserve parachute in sight? Tim Cook of Apple would tell you no.

False positives and false negatives are not the norm, but they are not as uncommon an occurrence as one might think.

When the CEO looks daily at the dashboard, increasingly similar to the complexity of a 747 cockpit, the most important question to answer is this: are we headed in the right direction? Speed matters, yes – but not nearly as much as the compass heading.

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Written by Michael

Michael Douglas has held senior positions in sales, marketing and general management since 1980, and spent 20 years at Sun Microsystems, most recently as VP, Global Marketing. His experience includes start-ups, mid-market and enterprises. He's currently VP Enterprise Go-to-Market for NVIDIA.

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