Siiquent, and its head Isolde Kraft, sells the resources that hospitals or big diagnostic labs would need to be able to run gene-based diagnoses. These places, and the doctors and scientists in them, would be their target market. Teomik, and its head Emanuel Geiger, provides research equipment to its market: research labs and universities interested in gene-based studies. They have an overlapping focus on genetics and an overlapping market in providing materials to genetic labs, but their revenue models differ with their differences in product.
Siiquent’s revenue model is very flexible; by selling resources at a competitive price for hospitals and providing top-of-the-line support they can keep a loyal customer base, but there is not a “right way” to approach that goal according to the revenue model. If enough people were dissatisfied with some service aspect, Siiquent would likely change one of its business practices. Teomik’s revenue model is similarly flexible but revolves around selling research equipment, earning larger margins than Siiquent less frequently for selling this equipment to genetic research labs. Imposing a single revenue model on the merger of these companies could force one or both of the companies to lose the flexibility they have built their support bases from. Responding to customer demand without being beholden to a revenue model has allowed both to respond to consumer demand effectively; however, this was also when they were in control of their respective patents. In the other direction, it could be harmful not to have a revenue model to know what aspects of each company are being affected due to a change customers wanted. Reactivity and innovation are useful tools, but so is accountability.
If I was the PM assigned to mediate the interaction between department heads, I would look at the similarities and differences between the companies. Isolde and Emanuel seem to have a good working relationship and, even though both are very pro moving forward without a revenue model, I would encourage them to try to create a series of revenue models together. We could start with the most similar aspects of the companies (for example, the standout service offered by PhD employees in both companies) and work to the most different, and most difficult, decisions. Even though they have reached the consensus that a revenue model would be unnecessary, Peter is right that their reactivity to customer wants could be drawing away from their ultimate revenue. This could be a negligible amount or highly impactful, but it is difficult to know what is affected without a revenue model to reference. However, Isolde and Emanuel are also correct that their respective companies are more than just “stuff” or “machines”; thus, a hybrid revenue model created with their input could be an effective one.
