Going Above & Beyond: New Product Development for Startups
It is our policy at IPS to actively invite engagements with startups who are developing new products. While the learning curve can be significant on all sides, shepherding new companies through the development process is very satisfying, especially when product development teams such as ours have the opportunity to provide startups with more added value than they were expecting.
A reputation with large and small clients that results in a continuing stream of recurring business, along with active (and even unsolicited) referrals, is largely a function of excellence in executing “business as usual.” That is design, engineering and project management professional services, and routinely completing projects on time, within budget, and satisfying all project requirements. While this always is a challenge, this is just table stakes. What’s unique is offering value-added support to clients on a business level, freely and openly.
Here are just some of the things to do to help clients get a complete, well-executed product design, and build a successful business:
Enabling Startups with Access to a Broader Network
From years in the consulting business, as well as our combined prior business experience, IPS has immediate access to an incredibly diverse network of individuals and companies who can support our startup clients. Sometimes, it is on a business function level. You can connect your clients to known trusted partners in supply chain management, C-level executive recruiting, academia, healthcare institutions, and even potential investor sources of funding. At other times, it is connecting clients to other clients in your network where they can learn from each other by “swapping war stories” or further network outreach. Introducing new startup clients into your network introduces them to a wide range of supporting relationships to help them fill gaps or get educated by other’s experiences.
Letting Them Know What to Expect Cost-wise
We are not surprised by our competitor’s unwillingness to work on anything but a Time and Materials basis. It’s risky and takes experience and courage to work on this basis. For startups, it is frequently necessary to make firm budget commitments in proposals. This is often critically important to them. Such clients are often running on very tight budgets or need to make budget commitments to secure investors. Without a clear understanding of costs, it is easy for a client to underestimate budgeting for product development and it can be hard (or impossible) to secure incremental funding to cover the cost of over-runs.
Working on a fixed-price basis takes a clear understanding of what a client needs (very explicitly) and what it takes to accomplish the goal. It takes discipline on the part of the client and your team to execute well. Without discipline, scope creep becomes an issue which then can be a problem for clients to maintain sufficient funding. As importantly, it takes courage and confidence on the part of your management team to take the risks inherent in fixed-price engagements.
Keeping Your Word and Standing Behind Your Work
This is an integrity issue. We are often amazed when we hear clients engage with a competing consulting firm and recount tales of having had to pay their product development partner to do the work, then have to pay them again to fix their own mistakes. Standing behind your work is a big value for startups. If an error is found (within a reasonable time frame), fix design mistakes. Credibility with clients is based on backing up your workmanship.
Clear Policies on Intellectual Property
This one always amazes us. Clients engage with a product development firm and pay the fees for non-recurring work. Then, at the end of the engagement, the PD firm does not turn over all their work to the client nor do they relinquish to the client ownership of the intellectual property (IP) created with the client’s money. As former purchasers of PD services, our managers would never have engaged with a firm where the rights to the IP is not transferred upon project completion and payment of the outstanding invoices.
General Business Help
IPS senior managers have been in the business world for a long time at fast-moving successful companies. We have also been closely engaged with dozens of tech startup businesses over the last several years. Our management team routinely helps the management team at our startup clients with a review of their business plans, cash flow studies, and investor pitch decks. In some cases, product development firms can help tighten up their product strategy into time-based roadmaps. Sharing your experience in what it takes to “get things done” in the product development world, will frequently help validate your clients’ product development plans and budgeting. A review by your executive and senior management team can add credibility to less experienced startups seeking investment capital.
Marketing and Promotional Guidance
Startup clients are often looking for opportunities to tell their stories to the media as well as online through published articles, blog posts, and social media. IPS is looking to do this as well, to spread the word about our own brand, and we’re sure this is important to you as well. We frequently collaborate and sometimes drive initiatives and combine forces with our clients in mutual activities to get the word out about their companies and their relationship with us. By combining forces, you and your clients benefit, and at a lower cost to each.
Leading business development activities and client dialogue with the product development value we provide is essentially the basic “product.” However, for many clients, extra unpaid services are the surprise value proposition. It is one of the things that prized startup clients remember, why they’ll come back to us with repeat business, and why they’ll refer us out into their networks.