Julian101.comThoughts, Lessons, Business Tips from ProWorkflow.com’s Serial Entrepreneur - Project Management Software

After a busy year of development, we’ve decided it’s time to sit down and do some annual code ‘house cleaning’. ProWorkflow has been well established for a few years now and over that time we’ve continually developed the application thanks to great customer feedback.

However, times and technology have changed - we develop all code to a high current standard, however, some older code in the application is being rewritten or optimized to perform better or to take advantage of new technologies.

Over the next month or two we’re focusing on speed and performance! We’ve just released the first maintenance update last Friday. This was rolled out to all subscription accounts seamlessly over the weekend with the new ProWorkflow v6.3 update. You should notice it’s running faster already! Below is a list of the speed enhancements in this update.

Optimized code on these pages
The  following pages have had code rewritten to remove spacer GIF’s, make better use of CSS, or to remove/trim old code. Over time we’ll work through the entire application.

    - Invoices Page (& Past Invoices)
    - Quotes Page (& Past Quotes)
    - Projects Page
    - Tasks Page
    - Invoices Page (& Past Invoices)

Improved the Audit Log
More events have been added to the Audit Log. We’ll continue to add further events with each update.

Improved Calendar Loading
The way the small sidebar calendar loaded used to slow down the page redraw as it was processing ALL tasks prior to displaying. We’ve changed this so the whole page loads, and THEN the calendar loads. Sounds trivial, but makes a huge difference!

Added a ‘Live Alerts’ notifier
Although there is currently a ‘ProWorkflow Updates’ blog built in, it wasn’t prominent enough, so many users would miss important updates, ie: Scheduled Maintenance Downtime’. We wanted to improve communication between users and the ProWorkflow team. So we’ve now added an extra ‘ProWorkflow Updates’ bar that appears at the very top of the screen ONLY for the ProWorkflow Updates we flag with the ‘Show In Header’ option. So if we need to let users know about a maintenance period or important update, we can do this easily. 

Added a new ‘Tasks Archive’ page
Most users have huge tasks pages. At the base of this page is the ‘Task Archive’ which actually slows down the page loading speed. This has been separated out to a new page called the ‘Tasks Archive’.

Added ‘Shared Images’ directory
Each account is currently a separate installation on the server and it has it’s own “/Nav_images/” directory. Every account has a copy of this same images directory. We’ve now pulled out all the generic images, ie: buttons, nav icons etc into one shared directory which all accounts access. This account’s images are cached on the server. This means when these graphics load in the application they’re already cached - so load very fast!

Added a ‘Speed Tips’ link in the header
We’ve added a new link in the header called ‘Speed Tips’. Clicking this will slide down a panel with tips specific to your login view only. These are just tips to fine tune your ‘Personal Settings’ to increase speed. ie: Clearing Updates and Alerts regularly, Hiding the small sidebar calendar under the left nav etc.

Introduced server caching for static data/images
Previously, images and static data would be cached according to your browser settings. This has been changed so that common images and static interface parts will be held in cache on the server. This makes a huge difference in page loading speed!

Server optimization for better performance
The developers have been monitoring and adjusting settings in ColdFusion, SQL and IIS on the servers to minimize heavy and repeat processing issues.

So what’s next?
Heaps! But the next key areas we’re working on now are:

- Project Details Page (Optimizing the code)
- Optimizing other pages throughout
- Upgrading all servers to  the latest ColdFusion 8 (Huge speed increase)
- Eliminating page refreshes
- Easier creating/editing of projects, tasks and time

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About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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Our development team have been working on an integration module between our ProWorkflow application  (www.proworkflow.com) and XERO (www.xero.com). ProWorkflow is web based project management software and XERO is web based accounting software. Both operate under a SaaS (Software As A Service) model. The aim is to transfer invoices from ProWorkflow to XERO and update the invoice status from XERO back into ProWorkflow.

We’ve recently been working on a QuickBooks (http://quickbooks.intuit.com) integration to do virtually the same function. Whilst QuickBooks is a great application and has high adoption, I have to be honest and say the integration wasn’t that easy. It’s taken about 2 months and we’re nearly there but keep encountering small, odd complexities. It should be ready very soon though.

Going back to XERO though, this is a whole different game. I personally signed up and have been going thorough the solution. It’s looking very promising and QuickBooks should be watching their backs - XERO are doing a nice job of reinventing accounting. There are pro’s and cons to a web based approach, just like there are to a client side app, but personally I prefer web based and portable.

On the API front though, it took weeks to suss out QuickBooks, but our developer had integration with XERO sorted within a few hours with data moving back and forth. He told us it was a piece of cake. So I wanted to say a big thumbs up to the dev team at XERO for the really easy API - It’s much appreciated!  Here’s a comment from our developer:

“Working with the XERO Network API was a great experience because of its simplicity in the integration compared to some other Accounting packages around.

I am very impressed with the guys at XERO on how they have created their Network API that allows partners to integrate smoothly without any problems. It basically requires a simple line of code to transfer to and from XERO. Out of all my experience in integration with outside applications, XERO is one of my favourites!

Great Stuff!!” - Vishal (Senior Developer)

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About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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Recently we had a company voice their objections to the pricing structure of ProWorkflow. Although we have many companies quite happy with the pricing, occasionally someone objects. It’s not the objection to price that is the issue here. It was more that customers often have a lack of education about the basis for the pricing - they simply think it’s a number, and don’t understand the justification.

I’ve asked permission from this company to republish the email conversation as it sheds some light on talking to ‘price driven’ customers. Here’s the email… (Read from Top down)

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CUSTOMER: Hi ProWorkflow team!

Just checking to see how much a 2 user license would cost running ProWorkflow on my own server.
Thank you.

- CUSTOMER

—–

Hi CUSTOMER,

Thanks for the enquiry…

We have a standard price of $20 per staff login per month, with code customers we change it so instead of paying per month, you can pay 3 monthly, 6 monthly or yearly. You can always get in touch with us to increase/decrease this number.

So it would be $40 per month x the recurring period you would like, so if you want to pay 6 monthly then it is $240 per 6 months.

- PROWORKFLOW

—–

CUSTOMER: Hi ProWorkflow team!

I am afraid that I will not be able to justify $480 per year recurring. You have written a fine piece of software but there are other much less expensive options, one being ??????? which is free for up to 10 users (they also offer a QB link for extra $). Others would include ???????, ????????? and ????????  (PWF Note: Whatever you do, someone always does it cheaper!)

I know that you used to have a perpetual licensing model. I could justify the $480 as a one-time purchase and would be happy to pay for upgrades periodically. (PWF Note: Maybe, but on that model R&D is unsustainable)

I don’t expect you to change your pricing for me  just wanted to provide some feedback.

Thanks much.

- CUSTOMER

—–

CUSTOMER: Hi ProWorkflow team!

Thanks for the feedback… Just some background though so you see where were coming from.

We have been developing the ProWorkflow solution for a long time. We listen to our customers and it has become clear over time that different customers have quite different needs. Our customers differ significantly in how they manage their projects, staff and processes. There Is no standardized way to manage projects and staff, each business tends to evolve a process that works for them using a mix of different systems and tools. Our aim is to continually develop a flexible solution that meets most needs, but the fine balance between ease of use (usability) and having every feature is ever present. So is the trade off between cost, features and service.

Different customers also look for differing levels of product support. Some are happy with a ‘next working day’ response, others want it now. Some want a one off fee, others want recurring - these differences are largely driven by the variation in the different business models used by our customers.
So the service and features required differ from customer to customer, and often what a customer needs today changes tomorrow.

A ’single solution’ simply did not deliver what our customers are asking for. So we have moved to introduce Standard, Professional and Advanced product offerings that bundle features and services to better match customer needs as they have been expressed to us.

Customers can choose whichever option suits them best, switching as their needs change.  So they can use the $30 Advanced version, then switch down to the $10 Standard version for a few months. This flexibility is the reason behind the 3x packages.

Regarding recurring VS perpetual licensing though…

Customers have asked for more  features, service and support.
- This costs ProActive, not only up front in infrastructure, but also ongoing per account. Ie: A perpetual license is fine, but if you ever need support, it needs to be in place, as does the R&D team so that there are upgrades being developed to offer. This all has a cost ongoing to ProActive that scales, regardless of whether a customer has perpetual licensing. So the one time fee doesn’t work as a sustainable model.

Product delivers value ongoing.
ProWorkflow delivers ROI not just once, but ongoing, for many years. Our licensing reflects this.

Underlying quality, reliable technology has increased in cost
All our technology partners have increased in cost. A free model would not allow us to recoup this.

I really cant speak for the other companies, only ours, but I can tell you that we’ve done a great deal of research into the cost of R&D, infrastructure  and support resource as well as the ROI the solution delivers. Were happy with our pricing now as we can build a sustainable company. Many of these other cos are eating into VC funds to win customers, or using free accounts as a marketing tool, hoping to get new customers to Spread the word. That’s not sustainable long term so we avoid that.

I hope that’s shed some light on our scenario  ;-)

Kind regards,
- PROWORKFLOW

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CUSTOMER: Hi ProWorkflow team!

Thanks for such a detailed response. I totally understand where you are coming from. It is logical. (PWF Note: Awesome! They understand!)

My complements again on a great product. I have evaluated something like 35 alternatives. (PWF Note: This is normal - the amount of solutions people try prior to PWF) Not-withstanding your comments I think you have hit the nail on the head. It amazes me that some folks can spend so much time and energy and still get it wrong. (PWF Note: Agreed!)

Best wishes for continued success.

- CUSTOMER

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SO that is the conversation! Always remember that when talking to price sensitive customers, the issue is seldom about price, rather they often just think it’s a random figure, not based on anything and easy to change. Also focus on explaining the reasons behind the pricing.

A SaaS customer is a relationship. So keeping honest and open and educating the customer is the best way to get them on board.

About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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Republishing Note:
Anyone is welcome to republish this article as free online content, provided that the paragraph below is included in the full form as shown.
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About a year ago, I did a series of YouTube vids for a laugh and also to share some advice I’ve learnt along the way developing www.proworkflow.com . Although I’m a year older now, and a bit more wise and weathered, this advice still stands. Please excuse the poor quality of the sound - I was experimenting with a camera and got some lag.  But I bet Twitter wished they’d listened to the first vid!

Here’s the series! Have a watch and tell your friends!

Business Tip - Don’t scale up before testing!
Learn why you shouldn’t scale up you web business before testing your internal systems and processes.

Business Tip - Don’t Make a Startup!
Learn why you need to make a ‘Started-up’ rather than a startup.

Business Tip - Be Good Don’t Suck!
Learn how and why you need to be good at what you do and how not to suck.

Business Tip - Low Inertia Web Businesses!
Learn why people love to hear a physical voice behind an internet company or web based business.

Business Tip - People love to hear a voice!
Learn why people love to hear a physical voice behind an internet company or web based business.

Business Tip - Fish in the Demo Pool!
Learn how and why you should be fishing in the demo pool of your web based business.

Republishing Note:
Anyone is welcome to republish this article as free online content, provided that the paragraph below is included in the full form as shown.
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About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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It’s a hard balance being in the Software/SaaS (Software As A Service) industry. We can put lots of time and focus into systems and development, but sales may suffer… or we focus on sales and then development suffers… ProActive Software (www.proworkflow.com) has bootstrapped (growth through no funding, and only sweat equity) to profitability thus far and this is fun to a point however if the intention is to bootstrap through to profitability as we’ve done, the issue is 100% correct allocation of resources between development, sales, systems and marketing.

We don’t have a truckload of resource, rather a smaller dedicated team and no massive flash offices (ProActive is largely a virtual team). There are a few contractors globally but we do A LOT with what we have.

We’re up to a good number of dedicated servers in California and one in NZ, and are in profit. So the years of hard work have paid off. Revenue is looking healthy and we all earn good salaries (founders work 16hr days).

The biggest problem I see in both the local and global market is the high number of software/SaaS co’s trying to scale, but using (old school) high inertia sales and marketing.

Ie: people having to hard sell, or visit companies premises to sell. Also, trade shows and exhibitions, travelling etc…

All this is fine (if you can afford it), but the underlying business model HAS to be low inertia, otherwise, it’ll scale, but so will the costs and expense… and profit will never come.

To be in New Zealand and compete in the SaaS market globally, there needs to be minimum expense per sale, and as the revenue grows, the margins need to expand as well.
If your business’s margins shrink with scale, you’ll hit a lid and have no profitability long term… Expanding margin mean you can scale faster as you grow.

Some companies I know of think that ‘Speed to market’ is the key. You must grow fast! – Bollocks - it’s a myth! Long term sustainability is the key. Be smaller and healthy rather than rush things with the wrong model only to find out that you’ve scaled up too fast on a bad model and the only path to profitability is to take round two funding (and lose more control).

We track our competitors (as it’s a competitive market) and probably 20-30% of the competitors I track have disappeared in the past 12 months. Gone! We won’t allow that to happen to ProActive Software  ;-)

In my personal opinion, Founders should also take a company to revenue BEFORE taking investment to scale – otherwise you simply give away too much of the company and the investment goes into R&D (Investment should go to Sales/marketing). Not only that, but it’s those bootstrap years that help you truely discover the ‘profit recipe’ of your business. You can’t spend needlessly – every dollar out must return. This thinking can be lost or clouded if too much investment comes in too early.

Ultimately there is one formula we ALL must adhere to to succeed long term.

COST TO AQUIRE a Sale
   < Must be Less than
AVERAGE REVENUE from a Sale

Where most companies get it wrong is on the ‘Cost to Aquire a Sale’ part. They make plenty of sales, but when you look at their model and costs, with trade shows, print ads, high sales costs etc they can blow 30x or more the monthly revenue they’ll gain..

Ie: A software co may spend (if analysed) $1000-2000 in time and company resource to land an average $50 per month sale. This means they’re not in profit until that customer has been with them 30 months. On this note, every company has a different ‘Average Customer Retention’ time.
This may be 3 months or 2 years, but simple maths will tell you that if it takes 30 months to get to profit and the ‘Average Customer Retention’ time is 12 months… Guess what… you have a problem… and you’ll be chasing 2^nd round funding sooner or later to stay afloat.

Understanding the key metrics around ‘Cost to Aquire a Sale & Average Revenue from a Sale’ is a key issue we all need to focus on – every day…

That’s my 2 cents for the morning… Time for a coffee!

Republishing Note: 
Anyone is welcome to republish this article as free online content, provided that the paragraph below is included in the full form as shown.
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About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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We have recently started upgrading all existing subscription accounts to the latest version of ProWorkflow Version 6.0. We have also changed our trials system over to using the latest version of the code.

For trial users nothing will seem new because this is the first time they’ve seen the system, but for subscription account customers there are so many little changes that you can become blind to any noticeable differences.

Lets go through some of the biggest and coolest new features/changes…

Read the rest of this entry »

Our SaaS business focuses on a project management solution we rent to a global user base (servers in the USA, the business is remotely run from NZ). No matter how hard we drive home the ‘Value & ROI’ message, there’s always a large number of ‘Price driven’ customers as we all know. The way to a price driven customers’ heart is education, not price cutting!

Price driven SaaS customers these days need to understand that SaaS software pricing does have real overheads behind it. The Simplicity of a SaaS business to a customer is a facade that actually hides the complexity of systems, material and resources needed to create a simple front end user experience… To explain further…

The shift to SaaS: Interestingly enough, in the old days (5-10yrs+ ago) the customer side (web and application development) of business would be a complex procedure for a one-off project, with sites often built by a business with a simple resource/skill base (designer+developer) and they’d charge heaps.
 
ie: Customer (Complexity) + Web Business (Simplicity)
= Revenue (High, one-off fees)
= Fast income, non scalable/sustainable model
 
Nowadays, we offer the clients a simpler tool and user/sales experience. However, as we have to charge less through market pricing shifts, the real money is made on margin and scale. Automation and infrastructure solves these, however comes with a cost of behind the scenes complexity and technology costs.
 
So the equation now looks like this:
 
ie: Customer (Simplicity) + Web Business (Complexity behind)
= Revenue (Slow, recurring fees)
= Slow income, scalable/sustainable model

To show this in a real world example, find out below what goes into our SaaS based project management software company’s latest V6 ProWorkflow software release!

Disclaimer: Firstly, I should just point out that I’m the CEO of ProWorkflow.com (ProActive Software ) and do understand that all software companies manage software releases differently. This is simply an example of how ProActive Software handles releases.

We’ve been working away on a new version 6.0 release of our flagship product www.proworkflow.com. This isn’t just a few updates, it’s a fairly solid new release with over 100 updates and pieces of functionality added. The main focus is on improving usability, speed and customer ROI. One of the mistakes we made was telling the user base there was a new release on the way! Now every day we get “When’s it coming? Is it late? Can you include this and that? or another common comment… “Why is it taking so long? It’s only an update?”

It was these type of comments that prompted me to write this post so I could show people the amount of work that goes into a release :-) The following is a glimpse into ’some’ of the thinking and effort needing consideration just to “Roll out V6?.

Customer Feedback

Throughout the year, customer feedback relating to functionality and usability is collected through various means. Emails, forms, calls, testimonials, sales calls etc. We file away the comments of interest in a document, categorized by the sections in the ProWorkflow application. When we do a minor release, we pick a few items of the list.

For a major release we pick the top 50-100 requests that are frequently requested. There are many hundreds of requests that either get dismissed or scheduled to a later release. We make sure no requests are contradictory and that they make sense to add to the core application. We aim to add generic features where possible.

Planning the Functionality

What goes in V6.0, 6.1, 6.1 etc? We always prioritise urgent needs of the masses first, then other needs, throw in a few ‘nice to haves’ and try to hold back on minor functionality for smaller updates later. Major releases (ie: V3, V4, V5 etc)  are ‘database releases’ so we add any new tables to the database needed in this release rather than the smaller regular updates.

When we have the desired list, developers give us estimated times per task and these are entered into our personal version of www.proworkflow.com to manage the project. Our core product ProWorkflow is web based project management software, so we may as well use it for ourselves! Also, this way we’re testing the solution at the same time as we’re working in it! Cunning way to test usability too…

Planning Development Time frames

We take a development list, which has been itemised and times assigned. When this has been put into ProWorkflow, the developers start working through it all. The most important aspect of keeping to the development timeframe is keeping tight communication with the developers. Every day or two we talk with the developers, see what’s been completed and look forward to the deadline to make sure there’s enough resource and hours to meet it.

In this industry, it’s always difficult to meet deadlines as unexpected complexities can arise when working on a complex application, however, through tight communication with developers and daily checking of the development plan we’re able to keep on track. The direct and real time visibility of progress through ProWorkflow makes this easy.

Development

When working on the ProWorkflow application, we prefer to use small tight teams. We do not want large teams of developers working over the top of each other causing errors or programming with different methodologies. Our lead developer and CTO Alan Barlow is the guru behind the ProWorkflow code base. Alan determines what he’ll work on personally and what others do (staff or contractors).

Testing

As we use the ProWorkflow solution for our own internal projects, the team are always testing in a live environment. In addition we have a small group of heavy usage customers that enjoy being early adopter test monkeys. Between the select group of 10 customers there are approximately 100+ users. These users create a combined few hundred projects and few thousand tasks and time records a week. So if there are any issues or bugs, we’ll know about them pretty fast. One of the great perks and opportunities with SAAS (Software as a Service) is that issues spotted can be easily and quickly fixed, applied to a live account, and then rolled over other accounts in a maintenance update. No need to notify the user, just apply the patch. Often we apply a patch live that fixes an issue a customer has never seen or improves a feature’s usability. It’s seamless ongoing development!

Pricing

With every major release (typically annually), the solutions’ pricing is reviewed For the past 3 years we’ve kept pricing as is - we’re currently reviewing pricing again pre V6. As much as we want to keep the pricing affordable, we also have to keep in mind that businesses don’t run on good intentions. In addition the tool provides great ROI to the companies using it so should have a relative value. So… the factors we consider when pricing ProWorkflow are:

• Value/ROI to the customer
• Technical Infrastructure (Servers, networks, comms etc)
• Support Infrastructure
• Research, development and ongoing development
• Scalability/Sustainability
• Competitor pricing and feature sets 

Support

When the V6 upgrade is released, there will be some new functionality. Even though this will be documented in the Knowledgebase, we’ll still receive calls and emails about the upgrade at a higher rate than normal. This puts extra pressure on support staff so we need to be prepared with quick answers and help docs.

Website Content Changes

The ProWorkflow website has a fair number of pages needing updating when the V6 product is launched. The following will need to be updated: Features, benefits, FAQ’s, packages, overview, all screen shots, version numbers, upgrade pages etc…

Update Knowledgebase (Online help guide)

A huge job, but an important one. There are 100+ tweaks to the ProWorkflow product. When you consider that 1 tweak may be referenced in 5-10 places in the knowledgebase, you start to understand that it’s a sizeable task. The knowledgebase is a strategic asset as the better it’s written, the less email and phone support we’ll receive. Self help means quicker support for the customer and less support infrastructure required at our end.

White papers

We have a couple of white papers  that give a brief overview of the solution. These will need to be read through and modified as needed.

Trial Account Master Code

When companies sign up for a Free trial account, the system sets this up from a master code package. This code package needs updating with the latest V6 code. The demo system then needs re-testing.

Subscription Account Master Code

When companies sign up for a Subscription account, the system sets this up from a master code package. This code package needs updating with the latest V6 code also. We have quite a few servers so the master code will need to be updated across all the servers.

Upgrade Packages & Downloads

In addition to Subscription accounts, the ProWorkflow software is also available as a code download to install on a local server. The master packages will need to be updated and the upgrade packages will need to include a new script to add the new V6 tables to the database when installed.

Update All Billing Systems

Depending on pricing or product options, the billing system may need to be tweaked. This would affect the Signup form, payment pages and account and billing pages in the Client Area.

Upgrade Current Subscription Accounts

When a new major upgrade is ready to deploy, we do this in a phased rollout over the customer base. The reason is simple - if there are any bugs we’ve missed, we’ll pick them up early, fix them and roll out further. In addition, we do the phased rollout to stop any new release from having a heavy support load over the initial week. The beauty of a SAAS model is that we can update customer accounts quickly. The downside is that if you rollout an error quickly you can easily affect a large number of customers. So planning a phased upgrade rollout is definitely the safe way to go.

Marketing

• Newsletters
  A few newsletters will be emailed out to the mailing list talking about the V6 release and new functionality.
• Press Releases
  We’ll write a handful of releases about the new product. These will be sent or syndicated to both local and global news sources. 

Project Management

Someone has to manage all this! Easy, We use our own www.proworkflow.com solution for our project management of new releases. See a screen shot (below) showing the huge project task list and timeline. There’s about 100+ tasks on the V6 development alone, and keep in mind this can increase if any of the new update code affects other parts of the application.  So effective project management is a key part of getting a release out…

Here’s the ProWorkflow Project screenshot for the V6 release  ;-)

Technorati Tags: Project management Software,Software,Rollout,SaaS

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Republishing Note:
Anyone is welcome to republish this article as free online content, provided that the paragraph below is included in the full form as shown.
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About the editor:
Julian Stone, CEO – Project, Management Software specialist for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com

An article came across my desk today about www.smugmug.com - a premium ad-free photo- and video-sharing site. Here’s the article: http://www.usatoday.com/tech/products/2008-02-19-smugmug_N.htm

These guys are a father and son operation with various other family members involved (and now 30 employees). They have a simple revenue model and 100,000 subscribers. Not bad. They’re now about a $12 million dollar a year operation which is impressive given they started with only a very small initial 200k investment from the father.

I say they bootstrapped though because 200k doesn’t stretch very far on wages, servers and other expenses. It looks like they simply did the hard work and grew! Good on them - it’s well deserved.

Anybody who’s bootstrapped a business to revenue or profit knows that it’s a tough road. Doable, but not easy, but when you make it you end up owning more of the original business and have a deeper understanding of exactly what makes your business tick.

Technorati Tags: Startup,Success Story,Bootstrap,Photo Sharing,Video Sharing,SaaS,Software

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About the author:
Julian Stone, CEO – Project management specialist for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com
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Original Post: Being 37signals for free
http://wisdump.com/business/being-37signals-for-free

After reading this post I felt I should speak my mind a bit in the comments section. They’s discussing how easy it would be to copy BaseCamp’s project Management Software product and offer a free version. I thought I should point out a few things in defence of them, www.ProWorkflow.com and other software providers who are trying to offer value-based solutions in a market flooded with price-driven customers. Here’s my comment:

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“Our solution is called www.ProWorkflow.com - project management software and we have many thousands of users in the 1-100 user level. I can tell you from experience that copying the code and building a similar tool is only a small part of it. Think about 37s’s overheads, back end management systems, networks, marketing commitments (paid and social), security, support, sales, backups, billing, 24/7 requirements, load balancing, monitoring etc. All this comes at a cost to 37s (or in our case, to us).

How much do you value your business? Some people on this list obviously don’t think their own businesses are worth a few cents a day! Sheesh! ;-)”

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Republishing Note: 
Anyone is welcome to republish this article as free online content, provided that the paragraph below is included in the full form as shown.
——————————
About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com

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We had a sales lead the other ask why our product was better than ‘Product X’ (competitor solution)… I responded with the following points:

1. It’s not better - it’s different!

2. I can’t say as I don’t know your needs yet, let’s talk further.

It got me thinking though. On one hand, we can try to continually redevelop the ProWorkflow project so we “beat” all the competition on the functionality front (development focus). On the other hand we can take time to talk with customers more to better understand their needs (sales focus). Or… We could just press on and spend more time and effort on marketing and drive more leads in the pipe (marketing focus).

So… assuming that you’ll never have a software product 100% right as customers have different needs, that you’ll always need to ‘sell’ to some degree, and that marketing is an ongoing ever changing mission, of these 3 key areas, should you have a primary focus as a company (ie: Sales) or should there be an even 1/3 1/3 1/3 split of time resource and energy?

Often tech companies (Especially Web 2.0 startups) have a strong focus (due to skill bias) in one area but neglect the others. For example, they have a great product and development team, but can’t market or get traffic to the website. Or they can get traffic, and sell, but experience high churn (customer drop-off) because they lack skills in the product design and usability area.

All companies need a balance, and the primary focus may change from company to company, but here’s some thoughts to consider while thinking about your development, sales & marketing.

Development Focus

• Listen to the tone of the customer feedback. Don’t just add features and think ‘Problem solved!’, rather understand the customers real problems and resolve them compassionately with not only a feature focus, but also a usability focus. Realise that real people have to sit down for hours each day to use your software, so consider human interaction when adding feature.
• Always look for ways to improve usability and speed and here’s a good tip for ideas. Don’t make assumptions, talk to the customers who use your software every day.
• Look for ways to reduce technical support (install wizards, setup guides etc) as this will free up developers time to focus on new developments, products or releases.
• Look for ways to reduce user support. Create a searchable, built in knowledgebase for example. Every time a developer (or support staff) answers a support issue, add it to the knowledgebase.

Sales Focus

• Focus and plan your sales funnel! Don’t give equal attention to all sales leads. Have a method or system sort out the hot leads and focus on those.
• When selling, consider the size of the lead you’re selling to. Ie: Don’t spend 3hrs (emails) and 2 hour long teleconferences selling to a $15p/m lead. These leads should sell them self, automated, online. You should choose from the hot leads, the larger companies and spend the most time converting those leads.
• A lot of time is wasted and conversion rates drop when salespeople don’t realize the person who signed up for the demo isn’t the decision maker. So the ‘customer’ seems to be loving the product and one day the deal fizzles! What happened was you were demo’ing to a project manager when you should have been getting buy-in from the CEO. So on the bigger deals, understand who writes the cheques and make sure you work towards getting them in the loop. Sell to the decision maker!

Marketing Focus

• Develop a plan to over time reduce marketing spend, not increase it. This way your revenue can go in to other areas or profit margins. For example, spend time money now on Search Engine Optimization (SEO) which will deliver natural free traffic over time rather than Search Engine Marketing (SEM) which can scale up traffic, but at an increasing cost.
• Develop a strategy to use social networking to your advantage. This could be a community site, viral video, RSS blog feeds etc. As long as you offer something to the audience of value, this will build to more free traffic over time.
• Think of your marketing approach as ‘What can I offer people’ rather than ‘Convincing people to visit me’. Ie: link and point to other people’s sites. Blog about other businesses, write articles to share, talk positively in forums – help people out with solutions. Have an ‘outward’ focus rather than an ‘inward’ focus. It’ll come back to you tenfold.

Those are just some thoughts to get people going. Feel welcome to comment below if you can think of any more considerations ;-)

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About the author:
Julian Stone, CEO – Project Management Software visionary for: ProActiveSoftware.com, ProWorkflow.com & Julian101.com