In this episode, Daniel asks Manuel about the basics of productized services, what are the benefits for you, your company, and your clients, and what first steps you can take to productize your services. Listen to this episode and learn how you can gain back your entrepreneurial freedom.
In this episode, we are going to have a dive into the world of productized services. Do you still tell your prospects and clients what you're doing, how great your services are, and what new features you just added to your amazing portfolio? Do you have trouble delegating and controlling all parts of your business? Are you stressed by all the incoming information you have to manage, or do you sometimes feel that nothing works without you? Then let's talk shop. Today in this episode, I ask Manuel about the basics of products or services. What are the benefits for the business and the clients, the first steps forward, productive offers, and what pitfalls you might expect on the way? So listening to this episode will help you to productize your business and reclaim your entrepreneurial freedom and independence.
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💡 QUESTIONS AND VIEWS HIGHLIGHTED IN THIS EPISODE:
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♨ EXCERPTS YOU MIGHT WANT TO JUMP IN
00:00 Intro
02:23 What is a productized service
08:00 What is missing?
09:41 Getting more clarity
11:45 Benefits for the clients
16:06 First steps to productize
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Manuel Pistner
Because when clients come to you, they say, I need social media agency. This is what they want. But what they really need is typically more leads or more clients, right? This is why they want social media management. But they end up up going to a service provider that just exactly does what they ask for. But the client doesn't know what they really need to get what they want. Right. They just assume that social media management or social media marketing can help them grow their business, get more leads because they read this somewhere.
Dani Guaper
Hello there and welcome to our weekly #AskTheCEO Q and A session here at the Virtual Frontier. Do you still tell your prospects and clients what you're doing, how great your services are, and what new features you just added to your amazing portfolio? Do you have trouble delegating and controlling all parts of your business? Are you stressed by all the incoming information you have to manage, or do you sometimes feel that nothing works without you? Then let's talk shop. Today in this episode, I ask Manuel about the basics of product or services. What are the benefits for the business and the clients, the first steps forward, productive offers, and what pitfalls you might expect on the way. So listening to this episode will help you to productize your business and reclaim your entrepreneurial freedom and the independence. See you in just a flash on the other side. So Hello, Manuel. Welcome to a new Q and A session here at the Virtual Frontier. Happy we got back together. And our topic today is going around productized services. And the question is what are productive services in the first place? And how you can become productized, service or create a productive service for your business.
Dani Guaper
So my first question for you would be, could you describe like the basics, what makes a product or service or business in the first place? And maybe also two or three famous examples where businesses went privatized and what that may be changed.
Manuel Pistner
Let me start with why productized and services are important and what kind of problems they solve. So typically it goes like this. When you start your service based business or you become an agency, any service based business for them, it's relevant. It typically starts like this. You offer specific services. Like you say, we are a marketing agency, software development agency. We do web development, whatever. So typically you describe what you do and then you want clients to become aware of you and request your service because they need what you do. Ten years ago, 15 years ago, that worked well because there were not so many service providers. And if someone was looking for a digital agency, there were not so many. Right. But if you start your business like this, then clients come to you and they always want everything individually. So even if you offer web development or digital marketing, right, this is such a broad thing that clients come to you with all kinds of things. And they expect that you, as an expert in that topic, can do everything they want. And you end up like working for one client, which is maybe a complex Corporation, maybe not, but it's individual.
Manuel Pistner
Then you get the next client. This client always wants another thing, something individual. And then you grow a client base. And from your clients, they all want every service, always individually, and that grows a huge complexity. And the only one who is able to handle this complexity is typically the business owner. And then the business owner starts to hire employees, and they try somehow to get along in this chaos and provide the services these clients want. But they can't do that themselves because they are not as knowledgeable and experienced as the business owner, nor do they have the skills to handle every individual client. So in the end, the business owner is caught between clients and employees and has many bosses, while what he really wants is the opposite, right? Freedom and independence. Now he's caught in a business where everyone wants his or her time and attention all day, every day. And productized services clean that up or avoid that, because the product is service is not to be precise, it's not a service. It's a solution. You offer a solution to a concrete problem. For example, a concrete itproblem could be you have a product owner.
Manuel Pistner
Product owner has an idea for an app and wants to build an app that users really love. So you can build a very clearly defined service that provides bright solutions of getting requirements as input Socalled user stories. And then you have a team with specific roles, and these people translate these requirements into code so that in the end you have a software that exactly matches the requirements. Now you could extend that by making a user research in the beginning to find out what users really want instead of just basing them on hope that some person knows what these people might want. Then it's unvalidated requirements. So you see that you can extend your product or service to different requirements and different levels. The easiest way to think of a product or service is, for example, a productized CEO service. Now this is from the perspective of what you do. Let's turn that around into the perspective what it does for your client and what your clients get from this. What clients want is more leads or more clients. And there are alternatives. They can try paid ads, they can try cloud outreach, they can hire salespeople.
Manuel Pistner
All these alternatives have problems. They are expensive, don't work, are complex. And if you want to position sale as one methodology to help clients win new leads or clients online in a better way, as all the other alternatives can do that, then you package this into a solution by defining specific features. For example, what do you need? To make CEO the growth engine of your business and win 100 leads in the next 90 days, which is a result these clients want. So what do you need? You list the features you need a sale strategy keyword list. You need a content plan. You need content. You need a content management system. You need a tracking system. Maybe there is something else. I'm not a SEO expert, but you see that you predefined the building blocks the deliverables of your solution. And once they are defined, you can offer them as a package and then it's very clear for your client what they get and for your team what they need to deliver. So all in all your productized offers streamlines the sales process because it's easier to sell a concrete solution and you streamline the delivery process because it's easier for your team to deliver something that they know what they need to create to make your clients happy.
Manuel Pistner
And they do the same thing again and again. So they get really good at it and get trained instead of just stressed that's what a podcast service makes.
Dani Guaper
Got you. So you're always on my next question, what are the benefits? But then let me rephrase that because I still see the vast majority of business owners are still hustling and running around and they don't have a productized service. So what is missing? Why the benefits are clear to me. But Where's the missing part? Why we don't have more of those productized services if this is so helpful for a business owner to free up his time and energy.
Manuel Pistner
So I think there are multiple reasons. Reason number one I think is that most service providers that have already grown a business beyond 100 to 100 or even $500,000 revenue per year, they are so deep in their business and they are so overworked and have such a high workload that they simply have no time and attention to rethink what they offer. They just think I need more people or my team needs to deliver better. But they don't think about that the root cause of all that mess and that high workload and the inefficiency is rooted in what they sell in their offer. This is I think the reason number one then when you start your business, I think you always started looking at your skills. So okay, I can do software development. So you offer that you do software development, right? You don't think in terms of results because people I think they are not used to think like this. You always get trained to look at your skills and learn new things. But this doesn't matter for clients. It matters what they get. And I think people that start a business are simply not used to that way of thinking or are not trained and don't have the knowledge.
Dani Guaper
I think that's it what would be some practical steps to getting more clarity and really focus on what matters. There and how to productize my services so I can take advantage of those benefits.
Manuel Pistner
Yeah. If you have an existing business, it's the easiest thing to list them in an Excel sheet. Write down per client what your clients initially asked you to do for them because this is typically how it starts. Clients come to you, they say, hey, can you do this? So you write down what they ask you to do and then when you already work with them, you write down why they need this. For example, clients come to you, they want a new website. So why do they need a new website if it is, for example, a commercial organization, a business? Why they need a website is because they want to win clients online. Right? That's the purpose of their website, converts visitors into buyers or at least leads. And if you provide marketing services and they ask you for social media marketing or social media management, ask yourself why do they want this? What is the result of us doing social media management for them? Is it they save a lot of time because they need to manage all the follower messages or is it that they get more leads because we build a funnel on social media for them?
Manuel Pistner
So this is the the why, why do they need the service? And then write down the what, what did you do for them? Very concrete. What did you build after you did the work? What was there that wasn't there before you started working with them? This is then what you built. And once you listed all your client contracts, you see where things overlap and you want to find the overlap in the why. Why do they need this? And then look at what did you build? And the more overlap you have, the better it is because the easier it is to create a productive service out of this. So this is how I would approach it.
Dani Guaper
Okay, interesting. So let's change chairs maybe. And see also what are the benefits for the clients or for the customer? If they confront a prior to our service instead of something else.
Manuel Pistner
They get what they really need. Because when clients come to you, they say, I need social media agency. This is what they want. But what they really need is typically more leads or more clients. This is why they want social media management. But they end up going to a service provider that just exactly does what they ask for. But the client doesn't know what they really need to get what they want. Right. They just assume that social media management or social media marketing can help them grow their business, get more leads because they read this somewhere. But typically this won't work because it's just one piece of the entire solution to win new clients or get more leads. So in the end, when you just hire a service provider based on what you as a client think you need to get what you really want, you end up being disappointed and everyone is disappointed, even if the service provider did exactly what you asked for. But you want to find an expert that understands your problem, offers you a solution, and gives you a clear roadmap how to get there. For example, if my problem is I don't have enough client requests, not enough leads, and I come to a service provider saying, hey, I understand you want, for example, 30 to 15 new leads per week using Google Ads, for example, so that your sales team can close them with a high conversion rate.
Manuel Pistner
I would say yes, exactly. This is what I want. Right. I feel much better understood. And when you have a sales team and the sales team talks to clients that request a specific service, the number one question they should ask is what do you want to achieve with that? Or why do you want that? Or what's your goal with that? Because then you move them up to what they really want. Right. And in the end, when you sell marketing, it's always more leads or more clients. When you sell software development, it's typically happy users or software that's easy to sell. Right. So your service needs to impact one of these two goals. So clients get better results with the productile service, I would say, because it offers a concrete solution to their problem.
Dani Guaper
Right. So are there any limitations? When we talk about productizing services or businesses, can everything be productized or are there some limitations?
Manuel Pistner
I don't know. Any limitations, no. You can even productize bespoke software development. Right. But then it's more like a service desk. Or you offer a scrum team, a fully managed scrum team that takes your requirements and transforms them into a software which is also a product or service as it has a clear defined functionality. Transform requirements into working software and you can create like this is scrum. You create a standardized process to make that reliably working. That's also productizable. Right. And that's what people often confuse. And it's easy to get tempted by that because the word productize makes you assume that you always sell the same thing, the same result, which is not the case. You always generate or create an individual result using always the same process and maybe even the same types of deliverables, which could be a values strategy. And there is a template how to build a sale strategy with all the components you need to define a Sayo strategy. But the Sayo strategy itself, once implemented, is of course, of course, always individually tailored to the business that needs it. You should not confuse productization with selling physical products that are always the same.
Manuel Pistner
It's always an individual result, but the process is always the same and the deliverables are the same. Just with individual content.
Dani Guaper
Right. Got you. So I'm a consultant. I want to prioritize my services. What is the first step.
Manuel Pistner
The first step is to look at I hope you have experience and you get your clients some results in the past by doing your consultation. The first step is you look at what your clients want from you when they request you. So let's do that. So you are a consultant. So which results did you get for your clients?
Dani Guaper
Ordering their processes, working with their teams and helping the teams provide getting more results, better results, that would be two short things that come to my mind.
Manuel Pistner
Okay, so you have the team get better results for the business and what do you do to help the team get better results?
Dani Guaper
Detecting, inconsistencies or detecting where they could improve with their processes. So finding the weak spots.
Manuel Pistner
Okay. So and what typically happens when you get hired, for example, like as a Scrum Master, people that look for Scrum Master to organize their team better, coach the team, et cetera. But in the end, what happens is that there is one person that hired you and this person tells you, now, please, you do this and that and then you have to go in this meeting and arrange this and manage here and this and there. Instead of doing this, when someone asks you if you can become a Scrum Master, you ask back, why do you need this? And you want the person to say, Because my team needs to deliver better results. And then you can say, okay, so I have a solution for you. The solution is, first of all, your team gets a training how to work result focused, which is a cultural thing. Then we make a goal assessment to define which results your team needs to deliver. Because if this is no clear, how should your team deliver the results? So this is then your next deliverable, right? And you create, of course a template. And then you offer a format like a workshop, 1 hour to interview the client, walk them through the goal assessment and fill this template and let them confirm that this is the goal, the results he or she wants from the team.
Manuel Pistner
And then you offer them to join the team meetings like three times per week and create meeting notes of what you've observed that the team can improve. For example, then you have clearly defined deliverables that you can put together as a product or service with the goal to increase the reliability and results of the team. And then there is also a lot more quality in it just compared to like you do something and what you think you want, right. You have a clear process with proven templates, with proven deliverables, with proven steps that all feed into each other so that in the end the team delivers a better result.
Dani Guaper
Got you. So my last question for today from my side would be, are there any pitfalls maybe you have encountered while implementing those products in your own business that could be avoided in the first place. So our listeners could take advantage of that right away.
Manuel Pistner
Yeah, there are two pitfalls. The one is when it comes to defining your offer that you don't align your offer with what your clients really want. You fall back into describing what you do. But clients don't care what you do, they just care what they get. So you need to articulate the features and then the related benefits. If you just talk about features like we create awesome websites and okay, awesome websites, nobody wants that. But if you say, we create websites that automate your sales process much higher value, right? Or we built an app, individual apps based on the top notch technology. Little bit nice, but not so good. But if you say, I built an app, you use love and love to pay for a much better I want to build an app that users buy. So this is what I want. So you communicate the feature and the benefit. This is the pitch for number one, that you just forget about the benefit and just talk about the feature or even worse, about what you do. And then the next thing is, when you build a quality standard for your product, guys offer that you go too deep into all details and try to micromanage every activity and tell your team everything they should do.
Manuel Pistner
This is not what you want. You want to start from the highest level of deliverables and try to just provide this to your team as an orientation and let them then build it right. And once you see that there are failures, you analyze the failure and try to find a way to avoid this failure in the future. For example, by providing a template. Let's say you say one deliverable is a marketing strategy. If you hire ten marketing strategists, you get ten different marketing strategies. Typically the question is which one do you want? So you should better provide a template to at least define the frame, how a marketing strategy should look like and what information should be provided by a marketing strategy that follows your quality standups. And that's how you get better and better with every implementation. But not from the beginning, because you will just be over and.
Dani Guaper
Awesome. Any remarks or closing works from Jour fixe or question that might be left out?
Manuel Pistner
Yeah, we have a complete training about that and it's for free. You can see that below the video. There is first a general training about the six building blocks of a productized service business. And in the next days, if you opt in for this training, you get an email with additional training. For example, how to sell services like product goal to deliver services like products, how to define high value offers, what you should productize and then also the steps of transforming an existing service based business into a productized business.
Dani Guaper
Yeah, great. All that we will link below in the show notes. So thank you manufacture for your time today and we see you next week for a new Q and a session.
Manuel Pistner
Awesome. Thank you very much. See you next week.
Dani Guaper
Bye bye. Bye. We hope you found the session helpful. Head back to our inner blog article on what our product services and how to product goal business. Did we miss something in this conversation? How can we do better so you get more values out of the content? Let us know to what extent your business offers are already productive and how that helps you to grow your business. We love to read and respond to your comments to round the session up and make sure you're not missing out on upcoming episodes. Hit the subscribe button, give a thumbs up and share the session around with your friends and colleagues so they can take advantage of this content too. Sign up for the free business builder training on Flesh. Io and learn more about how to scale with your business at any time. Work with global top tenants and make work better on behalf of the team here at Virtual Frontier. I want to thank you for listening today and as always, remember, keep exploring those new frontiers.