What’s the issue?
Electronics product development is risky and expensive. There are ways that product development cost can be reduced very significantly without sinking to amateurishness. This article is designed to point you along that path.
What are the advantages and disadvantages of DIY product development?
The DIY approach is generally bad if it leads to:
- Amateur standards, even if at a cost very much lower than the same delivered professionally.
- Lost opportunity because the business owners are spending less time on that which is their core skill, i.e., the topic on which the client is the professional.
- A egoistic perception that the business can do anything when in fact it is doing everything at a second division level.
- An adherence to DIY even when the business has enough cash to engage on issues at a professional level. In other words, DIY becomes a modus operandi rather that a stopgap.
- Deeper knowledge and research on a topic that is assimilated with a view to making judgements about the quality of professional providers.
- An integrated approach that uses professionals to guide but money is saved by the company ‘doing’ and also allowing professionals to audit and direct.
- DIY is seen as a stopgap that reduces the cost of the journey from the project start to having all factors except what is the explicit core skill of the company handled be external professionals.
- DIY will not shorten product development times. The extra work will usually lengthen it. The best way to shorten development time is to pour effort into the Specification process and recognise that extra budget spent with professionals, who’ve been properly instructed via very sound specification, will assist in shortening development time (time to market). Also, project planning (Agile) is key to easing the process along quickly.
How much can be achieved with DIY product development?
Actually, rather a lot, and if there is time for it, it is incredibly rewarding. You will learn a very great deal by doing and experience. It will not be the quickest route, but literally tens of thousands of pounds can be saved. It is worth emphasizing that if the budget is available, it will be quicker and better to leap to professional coverage of all the following requirements and not attempt DIY at all, but you should always research sufficiently to make sure you are choosing professionals well.
Can I do DIY management?
Most businesses do effectively start with DIY management. There is little choice because management skills are very expensive and of limited use unless targeted at the business in question. SMEs can often be capped in their growth because of the limitations of owners, and that isn’t to decry the wonderful thing that entrepreneurial business owners do for society, but we are all limited by our experience, training and talent. An example should suffice to make the point:
- Many businesses are started by engineers – one reason being that engineers are generally not treated well in the corporate world. Engineers know how to design, and to a degree, manufacture products. So if the business started by an engineer is selling a product that satisfies a niche, the business often grows into an SME. Because the owner is an engineer, we can make the assumption that development is well structured and configured to grow, but what about sales, marketing, finance and manufacturing? There is a risk that the latter disciplines will be neglected and consequently growth doesn’t become what it could be.
- A notion that it is big enough as it is. This is okay as long as it is accepted that it will die when you do and it will never make millions – or is very unlikely to.
- Working too much ‘in’ the business and not ‘on’ it. The engineer above will be relatively comfortable burying himself/herself in development issues, and maybe even doing development. The business is unlikely to grow beyond SME under this model.
- Cash is king with SMEs. Cash flow issues are most likely cause of business failure. Are systems in place to make sure debtors are managed?
- Marketing and sales are fickle fellows. If who we are targeting and with what aren’t constantly assessed and probed a business quickly gets out of touch.
- There are many more but the above make the point.
- Make maximum use of local business hubs and the training offered through them – usually free. These vary with area but are usually suffixed LEP, e.g., OXLEP for Oxford in England. This is free and doesn’t just deliver with free courses. It sets you up to meet other businesses (larger and smaller) from whom much can be learned.
- Network to the maximum – there is nothing like other business owners for putting you straight.
- Consider a subscription based management consultancy – controlled cost – circa £500/month. An example is ActionCoach.
Can I do DIY marketing?
Yes is the short answer. In fact, it is only business owners that can really know their market, and it is essential that they make continuous and diligent attempts to test and confirm the knowledge they have. However, there are methods and guides that can enormously assist in this process, and professional guidance is invaluable. In order to stay on top of the market, it must be studied. The following is recommended:
- The EM recommends the following book (Marketing Technology as a Service by Laurie Young and Bev Burgess). It is recommended that you read it cover to cover and then write your own marketing report that will give you the actions you need to be taking now to make sure your business is where it should be in 6 months/year. This will be hard work and take a lot of application, but it will pay great dividends. If this task has been done well the following will be evident:
- Who the target clients are.
- Where the target clients are.
- What the target clients need to be approached with.
- Expect to need to write another market report in about 6 months after which the report above will have run its course and a new one will need writing.
- Verifying the results of the above through a professional is advisable. You can use your local business hub, other business owners, and any other entity you feel has the necessary skills. It could also be sense checked through your management consultancy services, e.g., ActionCoach.
- Branding and image matter – not just on the website. You can do your own branding, but it may pay just to work with a professional from day one. The target is what’s called a Brandpack, which is a report that defines all the colours, fonts, logos, etc., that you will use in all your communications. The EM has had a good experience with The Leads Lab.
- A general piece of advice is that good consultants will be happy to work with you on a daily/hourly rate and just supply help when you need it. The EM’s advice is to avoid being sucked into training or brainstorming programs unless you feel completely at sea about how to approach research. It is much better to accept pointers and then do it yourself – if going for DIY.
Can I do DIY sales?
Well, you must! If you aren’t selling your business is either so wonderful it doesn’t need to sell (heard boasts of this many times but never found one that wasn’t in the media’s limelight like Raspberry Pi). A pre-requisite for good sales is that the marketing has been done – you’ll know where you’ve got to go and what to do if so. There will be campaigns to follow.
Running through the typical sales channels, noting that the most likely to convert to order should be given priority (cold leads are usually the toughest), for a technical service company, as the EM is:
- To sell you need to feel good. Make sure that whatever needs doing to make you feel good has been done before kicking off the big sales push.
- Don’t neglect existing channels. Your current clients may have enhancements or new work.
- Try your contacts. People who know you or have you recommended to them through someone who knows you both are much more likely to engage than those with whom there is no existing connection.
- Exhibitions. These are complex and can be very fruitful or a complete waste of time and money. Some general points are below:
- Make sure that you’ve done some research on all the relevant exhibitions in the country. Find out what companies attend and do some research on them too. You don’t want to waste time at exhibitions that either have little to do with your industry or don’t attract people you might be interested in.
- Exhibitions can sometimes simply be an opportunity to gauge suppliers, partners and competition. That doesn’t mean they are not worth attending but be realistic about what you might find. Sometimes exhibitions do lead to productive work, but manage your expectations.
- The decision making unit (see Marketing book) is important. Future business doesn’t just come directly from your proposed client to you. It is likely that there are both gatekeepers and influencers that are critical to lead generation. Consider this when selecting exhibitions.
- The big questions is whether or not it is worth exhibiting at a key exhibition. It will cost somewhere in the region of £10,000 to do this in all. Be critical because it is only true visitors you will miss. You can attend an exhibition for free and then be able to approach all the influencers, gatekeepers and, if relevant, potential clients you may find.
- Don’t expect instant results. Technical service industries are based on trust, and it takes time to build this up. Order placement is usually some considerable time after first meeting.
- Website. The biggest prerequisite for successful website selling is that the marketing is done. If you know Kipling’s serving men (who, why, where, what, how and when) you’ll have the data that needs to underpin a website push. As with exhibitions there are a number of key things to keep an eye out for:
- There are two factors to website promotion: getting the right people to the sight in the highest numbers possible; putting engaging content on the site so that if the visitor has an interest there is good reason to keep reading.
- The structure and design of your site, unless very specialist, is probably best configured via WordPress. You can do this yourself via the web, or have a provider do it for you. The thing to watch is that the provider will also need to be on top of SEO and your marketing – don’t split the resources for website construction and SEO (search engine optimisation). The Leads Lab can cover both for you, if you don’t feel able to support it yourself. If you are going to cover it yourself, you should figure on a progressive handover as time passes. This stuff is for the experts.
- It all starts with content. If you’ve got a good handle on your market, key word and phrase research is the next issue on the radar. This comes from market knowledge and analysing other people’s pages. You can have a go at this yourself (Search Engine Optimisation for Dummies), and doing so will help you understand all the work that goes in to it, but it is better to let a company that knows what it is doing deal with it if affordable. The Leads Lab is good for this. Once the keyword/phrase research is done the website needs building with great content that will keep a visitor on it. Most promoters make a mess of this because they are like actors – are only interested in themselves. That isn’t what will get people to your site. It is often hooking onto negative perceptions that will. What is needed is to compile a list of questions that potential customers are likely to ask and answer these questions via website copy – warts and all. Why is development so expensive? Why are development projects so difficult to complete? Why does it take years to develop a project, etc. That’s what a potential client wants to hear about – not how wonderful you think your company is. There is a good book (well mostly good) that covers this. It is full of anecdote but its central message is critical – and the author is bang on in his message. Of its 311 pages there are 11 that are gold dust – rest anecdotal. (They Ask: You Answer – Marcus Sheridan).
- Unless your content is so magnetic that you go viral and shoot to the top of the natural Google listings (natural is ranking in Google earned entirely from merit – no cost or advertising) you will need to sort out an advertising budget and PPC (pay per click) campaign. This involves investing a sum per month (say £1,000) for advertising/PPC. This links with the keyword/phrase research done above. You pitch for the keys you believe are worth it. This process is dynamic. Google metrics (providing your site has been configured correctly) will give you stats on how the site is doing – a lot of stats. You need to periodically review these and tweak your campaign accordingly. it is not advised that you go this alone. The Leads Lab will definitely be able to help.
- Linked In (social media). Unless you are selling directly to the public, Linked In is the best social media resource. It is very easy to get dejected with social media when it doesn’t work. It is very important to have what it is in perspective and recognise that it is only a lead generator. Once you actually start talking to someone Linked In becomes irrelevant for that relationship. The following are key points to consider:
- Get Sales Navigator for Linked In – about £70/month. It is worth it and painful without it.
- Make sure you have done your marketing. Working out your LI campaigns is critical and highly dependent on the results of your marketing.
- The EM is not a big fan of posts on Linked In. Most of them are either self congratulation or one upmanship. That said, there are some people who put real content on there – try to be one of these when posting.
- Make sure you have a company page, but note that when searching for people it is your personal profile that matters most.
- The key to LI is not to try and do everything at once. People don’t like the hard sell. It is much better to approach initially on the grounds of common interest and only ask for a question. Only follow up this question when there really is something to say.
- The key to good LI responses is offering something. Don’t go out there with nothing. What is something that your marketing report should help with.
- Doing LI campaigns yourself is something that can drive you to the Samaritans. It is soul destroying when either nothing or rude response is all you get. There is a way of avoiding this. Use the Leads Lab. If you know what you want to say they’ll manage it for you – keeps your sales mojo alive and kicking instead of on route to the graveyard.
Can I do DIY finance?
Can I do DIY intellectual property and legal issues?
Can I do DIY development?
The first matter, which you should certainly discuss with some professionals (product designers for example), is to decide the development road you want to start on – there is more than one. You may have an established product and an upgrade for which interest is strong. A full Specification Pack at the outset and development geared to it may make sense. You might also have a product for which you are not totally sure there is a market. It may well be better to do a first pass Product and Performance Specification, accepting that it will need a re-visit, and go ahead and get a presentable prototype that shows the market disrupting functionality as quickly as possible. This makes sense because of the reaction that it makes in your prospective client. If there isn’t keen interest, you are either in front of the wrong people or your project doesn’t have the market traction you thought. Ask for commitment from your prospective client – order? It tests the water.
There are usually 3 elements to the design: software/firmware/; hardware electronics; mechanics and enclosure. If you are prepared to do a lot of groundwork, you can reduce the costs of these down by orders of magnitude, but it is extremely easy to take wrong turns. Later articles will cover the details, but for the time being it is best to contact the companies in the bullets below and ask advice about how to minimise cost via DIY:
- For hardware electronics and straightforward firmware, CONTACT US.
- For advanced software and firmware contact a Bermondsey Electronics.
- For mechanics and product design contact Idea Reality.
Can I do DIY manufacture/operations?
The EM would be delighted to give you further guidance if you need it – please click CONTACT US and we’ll take it from there.