Graham R. Joyce over at Pragmatic Marketing (a product mangement consultancy) shot over to me a link to their latest e-book The Secrets of Market-Driven Leaders a few weeks back. Didn’t have a chance to look at it until this weekend (sorry Graham!). Take a quick scan, it has some funny anectdotes as well important lessons for product managers.

Here is the main nugget of the pdf (if you are too lazy to read).

I rarely embed pictures into my posts eventhough I should (more readers). . .but usually I’m too lazy and posting is an impulsive activity I do randomly throughout the day. But this time, I thought it was important enough to get into my flickr account and make sure this graph is in the post.

Now, ofcourse its important to be at the upper right hand side, but even more important is to realize that the green arrow ALSO represent a time axis for a startup. IE. . . startups are often first founded on (1) a technical idea or breakthrough. The MBA then comes on the team and helps put together a business plan by (2) analysis of competitors and how to position in the market in respond to those pressues.

Now here is the hard part . . . once a company is launched (already hard enough to get to the second step) , a sucessful company will move toward either of the 3 quandrants left. Most start ups, if they are lucky enough, become sales or customer driven. Being customer/sales driven (ie focusing on your CURRENT/EXISTING/ALMOST customers) is not a bad thing to do. I can only wish more companies are like that.

But, sometime in the near future for a startup to scale (or another word, to cross the chasm) it needs to focus on solving the need of its entire target market. The sales and customer driven quandrants offer Calypso-like bounties but entraps the startup in a state where it is narrowly focused on a niche and thus caught in a detour from its true mission.

Perhaps a little counter intuitive, the startup needs to be a little more selfish & strategic in its priorities. It needs to understand that Market Driven vs. Customer/Sales Driven is the difference between $50M and $500 in revenue. Of course, its hard to do, thats why most startups fail and even less become an industry changing company.