Which markets do Isolde and Emanuel target respectively? How do their respective business/revenue models align with their markets?
Isolde, the head of Siiquent, targeted hospitals and big diagnostic labs as their target market, focusing on diagnosis. They follow “razor blade” revenue model, in which the company makes money on the stuff required to run the machines rather than the machine itself. This aligned with their market because most hospitals and diagnosis labs were on tight budgets that made it more difficult to afford fancy machinery. However, the smaller-ticket items were seen as money-savers for these institutions, making it much more accessible.
Emanuel, the head of Teomik, targeted research labs and universities, focusing their market on the world of research. These institutions were more focused on getting published and gaining prestige. As a result, the higher price tag of the machinery was less of a confining factor as it would allow the institutions to reach their goals.
Both groups reacted to the market, in terms of the customers and competitors, in order to constantly adjust.
What are the pros and perils of “imposing the structure of a single revenue model” vs. “letting [the company] continue on its flexible way”?
A single revenue model would allow for greater consistency and structure within the company. It would allow the company to make a single strategy and invest more time into understanding their market, and make it easier to set themselves apart/build and maintain their customer base. However, choosing a single source of revenue could be troubling when competitors, new customer needs, or sudden shifts in the market occur. It may cause confusion or frustration for customers as they must adapt to conditions and treatment they have previously received. As these companies have constantly adapted to the needs of the customer, taking away flexibility can be jarring and seen as an abandonment in company values.
Continuing in the flexible manner would allow the company to quickly respond to changes occurring in the dynamic markets of medicine and research. However, this would come at the cost of organization within the company. Although the companies would be able to serve their previous customers effectively, the merger has clearly caused confusion as multiple sales reps are now reaching out to the same people with varying offers.
Pretend that the CEO has decided the department heads must merge their divisions together. As a star PM assigned to mediate this interaction between department heads, how would you scaffold the discussion to ensure a fair merging process?
In order to ensure a fair merging process, I would first make sure that Isolde and Emanuel met in a context outside of the workplace. In order to understand each other as managers, it may help to view each other as people first. I would also have them list out their own values (both personal and related to the company) to see where they may have common ground. After figuring out values they find important, I would have them make take a dive into the markets and see how they could combine their resources in order to serve a more expansive market. I would probably meet with them individually to further investigate their perceptions on the value of their methods and market. Truly both are bringing a unique perspective to the market, and in a dynamic market space, but it seems that their emotions and passion as managers could inhibit their ability to truly come to a compromise.
