1.Isolde is head of Siiquent, which caters to hospitals and big diagnostic labs. Siiquent provides all the necessary tools and equipment these institutions require for gene-based diagnosis. Siiquent’s business model is akin to the razor-blade strategy. They sell the diagnostic equipment, or the “machines,” at cheaper prices, but their primary profits come from the consumables that these machines use, the “stuff” that directly targets the diagnostic labs market because Siiquent sell them slightly cheaper than market.
On the other hand, Emanuel is head of Teomik which is a unit that targets research labs and universities by supplying everything required for gene-based studies. They primarily profit from the sale of their sophisticated research instruments or “machines.” The sale of consumables or “stuff” doesn’t significantly affect their bottom line since their focus is on selling high-margin, patent-protected devices which is a perfect target for their market of research labs/universities since they do not balk at the higher prices.
2.Imposing the structure of a single revenue model offers the pros of clarity and simplicity. It creates a streamlined approach to business operations, allowing for easier forecasting, budgeting, and strategic planning. With one clear revenue model, there’s a unified direction. However, the perils of this are rigidity in a rapidly changing marketplace. By locking into one revenue model, a company may find itself unable to adapt quickly to market changes, emerging competitors, or evolving customer needs.
On the other hand, letting the company continue its flexible way promotes adaptability and responsiveness. This dynamic approach can be particularly beneficial in rapidly changing markets. However, the pitfalls of this method are a potential lack of clarity and strategic direction. Without a clear revenue model to guide decisions, there will be a rise in internal conflicts.
3.The first step I would do as a star product manager would be to remind both heads of the common goal: both units aim to ensure the success and sustainability of the newly merged division. Next, I think it is important to form a collaborative environment through information sharing. Now that the companies are joined, they should become one unit. A series of facilitated workshops should be organized to help with information sharing. This ensures that both parties have a deep understanding of each other’s operations. These sessions can also help shed light on any potential conflicts that may arise from working together, and also what issues each company was facing before the merge so that the merged entity can work on these issues together. I also think it is important to discuss possible reorganization of teams to make sure teams become more cross-functional and work is shared between the companies instead of companies working independently from each other like before. Finally, I think it is important for periodic review sessions to highlight progress of integration between the companies and any open issues. This should be as transparent as possible for all employees so that everyone can have a feeling of being part of the new team.
