Why We Look Away
I’ve owned six Jaguars.
Six. Not because they were reliable. Not because they were practical. Because I loved them. Deeply, irrationally, the way you love something that became part of your identity.
The last one was a slightly used beauty I picked up in Vegas — a friend found it for me. On the drive home, it threw an engine light. Started running a little rough.
Did I turn around and take it back? Of course not. I called my buddy and we figured it was probably just oil, dirty gas. His mechanic had checked it out after all. Had to be something minor.
It wasn’t.
Thousands of dollars later, after replacing every injector, seal, multiple tunings and more, I finally got it running good enough. Hope springs eternal.
My first Jag was a V12 in tuxedo white with a black top, old English barrel gauges. Gorgeous. I had to be cautious, I was doing 110 before I knew it. It was an absolute nightmare to keep on the road. On and on the list goes. Six Jags. Every one of them cost me more in repairs than the car was worth.
Every one of them made me smile anyway.
We hang on to our favorites in business too. We don’t end up smiling.
A turnaround client had a product that was genuinely brilliant. The kind of technology that makes engineers’ eyes go wide and competitors go quiet.
It was also five years old. The market it served was moving on to brighter shiny objects. My client kept pouring money into the beloved software. More than half their entire development budget. Because they loved this product. It was the product that put them on the map. Their baby.
Meanwhile, another team inside the company had something new. Something hot. Game-changing potential in one of the fastest-growing segments in their market.
That new product? Underfunded. Understaffed. Constantly losing the resource fight to the precious baby.
Their future was strangled so the past could survive.
When I asked the executive team why they were still investing so heavily in a declining product, the answer was immediate: “It’s our core. It’s what we’re known for. Our customers depend on it.”
All true. Once. Not anymore.
When I spoke with their customers, I learned many of them were already looking for something better. Many were in the process of changing lanes. They just hadn’t told my client yet. They felt guilty for leaving. Love those kind of customer relationships, right?
Successful products become like our children.
We create them, nurture them, deliver them to the market with all the fervor of proud parents. We sit back with grins as the world falls in love with our creation.
When the revenue road gets bumpy, we conjure up the glory of our past successes. Sales may have slipped, but that must be a temporary blip.
So we discount. Just a teensy bit at first. Then the slippery slope begins.
We offer extras and add-ons to keep it shiny. We throw in free services to drive that top line. Lo and behold, it works! Our customers still love our baby. Just look at those revenue numbers!
Margins? They’ll come back…
The product that makes us successful becomes status quo that drags us down.
Even in business, love is blind.
When your best seller can’t sell without a pile of extras propping it up, that’s not a best seller anymore. That’s a habit.
The top line rarely tells the whole story.
You can bury a lot of mistakes beneath a growing top line.
Revenue growth feels like success. Yet the thrill of the top line always gives way to the reality of the bottom line.
I had another client selling big, complex systems. They’d taken off like a rocket. Sales were growing. The executive team was confident more growth was just around the corner.
Under the covers, they were losing money. On pretty much every deal. Their sales force had learned to discount. They’d also learned to give away value-adds as a way to close business. Like custom tuning, extra consulting and services, all human-intensive value.
The company measured performance on top-line revenue and contribution margin. Which didn’t show the added human costs flying out the door with every deal.
That was a fun conversation with the executive team.
So what do you actually hang onto?
That first company I mentioned? Their ability to see what others couldn’t and build what others wouldn’t — that was their core value. Their best-selling product wasn’t the value. It was just one expression of it. And that expression had an expiration date.
Your best seller isn’t the thing you ship. It’s the thinking behind what you ship. That’s your fuel for whatever comes next.
Which is why we need to question our status quo about that best seller.
Is your best seller really distinct anymore? If your reps are discounting to keep it moving, that’s a signal worth paying attention to.
What does it actually cost to keep it “best”? Not just the direct costs. The discounts, the extra training, the support hours nobody tracks. The more you sell, the more you lose.
What are you NOT doing because of that baby? What are you not funding — or worse, strangling — to keep it alive?
Who are your best customer opportunities today, right now? Markets shift as fast as the sun sets these days. Yesterday’s best customers become tomorrow’s losing proposition.
Then there’s the human question: Are you growing your business, or feeding your baby?