Skyjed guides you through a step-by-step review and assessment of your product for product success. A Skyjed Driver is a prompt for information or product rating
Driver 1: Drivers of cost
This details the key ‘buckets’ of cost for your product. We like to cluster product costs into three areas. The costs of delivering your product to a customer, the product costs and operational costs. Understanding cost areas helps your find ways to improve product margin and profitability.
Driver 2: Cost of goods sold analysis
Product managers need to track all the costs that are directly involved in producing their products for sale, in addition to the operational costs. These direct costs are called cost of goods sold or COGS> These costs appear in your organisation profit and loss statement (P&L).
Driver 3: Cost actual
This detail the annual plan of your product costs and tracking the actual performance. Starting with basic list of the cost areas and forecasting the cost amount for your product is useful.
Driver 4: Cost actual / plan
This details the cost area as a percentage of revenue. This is a useful measure of efficiency indicating the expenses as a percentage of revenue. Its useful to assess and track changes over time. In this example we look at the cost percentage in prior year and cost percentage in current planning period.
Driver 5: Margin actual and plan
This details your product margin performance and tells you how much the product sells for above the actual cost of the product itself. Product margin is the profit margin per product. It gauges the degree to which your product makes money. It also tells you how much of the selling price is “mark-up’. Its valuable to compare products over time and across the portfolio. Together with revenue this is an important metrics to understand.
Driver 6: Competitor margin insight
This details how much you can find out about your competitors margin performance. Its difficult to find out, however keep updating information as you understand it from your sales team, customers or benchmark reports. You will experience margin pressure on your mature products whenever the input costs rise and or price competition changes. Competitive pricing is one of the most important components when it comes to creating your product plan.
Driver 7: Supplier management
This details your suppliers and keeping tabs on the commercial arrangements and pricing reviews. Often a procurement team manages suppliers. Reviewing your product suppliers will ensure all the contracts with suppliers support your product plans. It helps you ensure maximum value and quality. As a product manager you can also contribute to understanding important issues like modern slavery obligations for your product.
Driver 7: Sales productivity
This details the key product metrics to achieve the sales targets. Its useful to break down the underlying metrics for sales productivity and review them. For example, understanding the lead to conversion ratio for your product. Collaborate closely with your sales team to set, review and improve your sales productivity.
Driver 8: Cost effectiveness plan
This details your plan to improve product costs. It also helps you to more accurately predict costs and avoid running over budget. Cost management plans can be customised to fit your unique needs. It generally follows a standard format setting out cost area, tracking the costs and developing improvement initiatives with a target date for implementation.
Driver 9: Supply chain action plan
This details how you will work with your suppliers to monitor quality and improve efficiency. Product teams can provide valuable input into collaborating and developing action plans to improve performance. Its useful to be aware of any quality issues, breaches of contract and modern slavery obligations.
Driver 10: Supply chain analysis
This details the key areas of managing the sourcing of primary materials, transporting goods to satisfy your end-users. Supply chain focused on your finished product and end-users. Product managers often provide inputs into reviewing the supply chain with the goal of delivering a high-quality product free of modern slavery.