Market-driven software
engineering
Basic concepts
Different drives
 Technology driven
 Contract driven (bespoke development)
 Market driven
Originator: Joachim Karlsson
Product management – where are they?
 Marketing and sales
 Research and development
 Own department under CEO
Originator: Joachim Karlsson
IndustryWeeks 2002 Value-Chain Survey
- focus
Lowest product
cost
13%
Meet customer
needs
69%
Most innovative
features
11%
First on market
5%
Other
2%
Originator: Joachim Karlsson
IndustryWeeks 2002 Value-Chain Survey
- problem root causes
Bad execution
14%
Weak business
strategy
14%
Lack of
resources
20%
Low support
from
management
6%
Other
12%
Low
understanding
of customer
needs
34%
IndustryWeeks 2002 Value-Chain Survey
- most impact on TTM
Reallocation of
resources
between projects
29%
Collaboration with
customers and
partners
32%
Originator: Joachim Karlsson
Formal product
development
process
22%
Other
9%
Focus on product
platforms
8%
Doing too much of some things…
Often 19 %
Never 45 %
Sometimes or
always 45 %
Originator: Joachim Karlsson
How often features are
used in practice.
Source: Butler Group.
Originator: Joachim Karlsson
Market segmentation
 Segment: a subgroup of consumers sharing the same needs
 Consumers are organisations or people
 Variables for segmentation:




Geographic
Demographic
Psychographic
Behavioural
 Statistical clustering techniques: distance measurement and
linkage rules (http://www.statsoft.com/textbook/stathome.html)
 Related topics:
 Targeting
 Positioning
 Niche market
Segmentation
 Volvo
 Segments per country and
 family type
 Cell phones
 From adoption models to price and age
 ABB company
 Chose two customers to focus on
 The rest had to adapt
Originator: Joachim Karlsson
Segmentation: Harley-Davidson






Dream Riders
Zen Riders
Tour Gliders
Hard Core
Hog Heaven
Live to Ride
Originator: Joachim Karlsson
40 %
20 %
14 %
10 %
9%
7%
Portfolio analysis
 A collection of business and products that makes up the
company
 Optimise company strengths and opportunities
 Outcome: investment and growth plan
 Sample method The Boston Consulting Group Box:
Competitor analysis
 Analyse strengths and weaknesses of competitors
 Use information to define opportunities and threats
 Sample method: Competitor array
Competitor
#1 rating
Competitor #1
weighted
Competitor
#2 rating
Competitor
#2
weighted
Key Industry Success
Factors
Weighti
ng
1 - Extensive distribution
.4
6
2.4
3
1.2
2 - Customer focus
.3
4
1.2
5
1.5
3 - Economies of scale
.2
3
.6
3
.6
4 - Product innovation
.1
7
.7
4
.4
Totals
1.0
20
4.9
18
3.7
Competitors?