Position: Product Marketing Manager, Desktop Software Business Unit
Displaywrite 5 (word processing)
Composer (desktop publishing)
Situation: IBM was consistently losing market share in the PC Productivity Software category and management agreed they needed to re-invent how IBM was addressing delivery, marketing, and distribution of these software products. IBM created a new business unit, as they did for developing the Personal Computer, named IBM Desktop Software. The objective of this unit was to successfully rebuild IBM’s software product line and image and drive sales so that IBM had 30%+ market share of PC Productivity Software. The management of this business unit chose to go outside IBM and hire three managers to come in and provide new blood and innovation. I was one of three selected for this mission.
Stage 1 – Building a New Business Unit:
To succeed in delivering on the divisions objectives the first order of business was to gain consensus on the business strategy that would be implemented to build a software business quickly and profitably. I succeeded in convincing the management team that the optimum path was to pick 3-4 software areas of highest opportunity for IBM, determine whether IBM internal technology was available that fit current and future market requirements, and where it is was not available proceed to acquire external technology. A key principle for acquiring external technology was that IBM would not fully acquire the companies or products but rather would keep the external development organizations intact with IBM acting as the exclusive marketing organization. This philosophy assures motivation of the developer, as they are paid for the delivery of a series of successful products, and played to the strengths of IBM – sales & marketing.
The product areas identified as having the greatest opportunity for IBM were word processing (DisplayWrite installed base), desktop publishing (Interleaf relationship), graphics (presentation graphics and multimedia), data base, and the emerging personal information manager category. Given my experience in word processing and desktop publishing, I was chartered with making the make vs. buy decisions for these categories. For brevity sake, I will focus on the word processing process and decisions.
I first put together a category business plan that outlined market size and opportunity, market success factors, product strategy and functionality requirements and gained approval of this as the basis for future actions and decisions. I then proceeded to travel to each IBM division that had editors or word processing as part of their charter and evaluated their products, technology, and development and marketing organizations. At the end of this review, I concluded that with the exception of linguistics technology (spelling/grammar checking and correction) IBM’s word processing/editor products, technology, and organizations were outdated and ill-suited for success in the desktop software market. I made recommendations for organizational changes that drastically cut back and consolidated all word processing/editor product development under the new Desktop Software business unit, and convinced management that for market timing a new code base must be acquired from outside IBM. These recommendations were accepted and acted upon and involved consolidating and re-organizing five divisions and over 200 people across the company.
The most complex task was the identification and acquisition of a new technology base that would be advanced enough to be considered “best-of-breed” for the category, and flexible enough to allow for modifications to transition the DisplayWrite installed base. Using top office automation consultants and industry contacts we identified all potential technology, and we chose leading contenders for further analysis. We conducted an extensive evaluation of products and technology using internal and external architects and the list was finally brought down to 3 companies. I initiated negotiations with these companies to determine which was the best fit for IBM in terms of cost, relationship, sustained performance, and innovation. In the end XYQuest was chosen and a business partnership was formed where they would become the new primary development arm for IBM desktop word processing (DOS/ Windows/OS2/Mac/Unix).
At the end of this process I transitioned to becoming the manager of word processing/desktop publishing marketing and the XYQuest relationship was managed through the development organization.
Stage 2 – Introducing New Marketing Methods for IBM Software:
The DisplayWrite product for years had been marketed very little through distribution and relied on the IBM direct sales force for its sales volumes. With the impending release of DW5 and DW5/Composer, which were uncompetitive with the market leaders, a marketing plan was needed to successfully introduce the product and sustain previous years sales volumes while waiting for the newly acquired code base to be finished. Over a six-month period, I hired two experienced marketing communications people, contracted a new PR agency, Ad agency, and sales/marketing materials agency with PC software industry experience. Established new procedures and guidelines for the marketing communications group and delivered an integrated marketing campaign.
This campaign involved re-positioning the product as the product of choice for administrative/clerical word processing users, the market segment most loyal to the product. Introducing IBM into the distribution channel through new contracts with Ingram-MicroD and Merisel (the market distribution leaders) to increase the availability and sales potential of the products. Developing a set of integrated marketing materials that addressed training of the sales force (internal and external), store front introduction kits with training, demo materials, point-of-sale displays, and a sales contest awarding those who took the time to read the materials. We drove market awareness by executing an advertising campaign into PC publications and vertical publications that targeted secretaries and AA’s (Working Woman, Inc., etc.).
The campaign was considered the best that IBM had launched for software and had set the standard for subsequent software marketing programs. Sales dramatically increased over the 6-month period following the campaign driving category revenue from $60M to over $100M.