Development Manager, Nokia
The Ansoff Matrix, which was first published in 1957 in the Harvard Business Review is used to select strategies for growth based on whether the growth is gained from existing or new markets and with existing or new products.
As a result of analyzing the different possibilities, management typically chooses only one of the four strategies because spreading resources into different strategies can easily fail. The strategy a company chooses should be reflected in the customer documentation. Let’s take a brief look at the different options and their effect on documentation.
Existing Products for Existing Markets
In this segment, a company can withdraw from some markets or cease to make some products. Initially, withdrawal may not seem like a growth strategy but, for example, if resources are scarce, concentrating resources into products that really bring revenue to the company instead of trying to compete with strong competitors can be a smart move. In this case, the documentation of the products stops if the products are not created any more, or if the withdrawal concerns only part of the market, the documentation may not address the needs of that particular market.
Another option for the company is to improve the value of its current products and services to maintain its strong position as the market changes due to new entrants and competitors’ moves. This option requires increased usability of documentation and, possibly, good training programs. So studying users, gathering customer feedback, and monitoring service desk calls are the actions to take to increase customer satisfaction.
A third option is to try to gain market share by reducing the price of the product. This option generally means lowering the development and production costs, which means that the documentation also has to be analysed carefully to decide what is really needed by the customer and stop spending money on nice-to-have documents or features in the documentation.
New Products for Existing Markets
In this segment, a company develops new products for its existing customers either by using its current competencies or by getting new competencies. If the need for product development comes from changing user needs, then the task is to understand those needs and fit the products to them. When the company is using this strategy, you can use your existing user knowledge as a base to create documentation for the new products and, perhaps even more important, use your user analysis skills to find out the new requirements and feed them back to product and documentation development.
Existing Products for New Markets
In this segment, a company may extend its products to new market segments. For example, the company may decide to market a documentation-management system, which was originally created for managing legal records, to other types of companies. This strategy usually means slight changes to the product to accommodate the needs of the new market. Another option is to develop new uses for existing products, which then require changes in documentation to reflect the terminology and tasks of the new use. The third option is to move into new geographical areas, which may then require translation of the documents, which in turn means that the source text should be created so that it is easy to translate or localise.
New Products for New Markets
Diversification is the most difficult transition a company can make because everything is new. Related diversification means that the new market somehow relates to the company’s current market. For example, a car manufacturer may start making motorcycles as well as cars, or a manufacturing company may start selling its products instead of using resellers. An unrelated diversification happens when a company moves to totally new markets, such as when a telecom company starts making tissue paper. A company may also use its competencies and resources to create totally new markets that did not exist before.
For the documentation organisation, diversification also means major changes if the company intends to create good documentation. Understanding the new markets and customers and creating appropriate documentation to support the marketing efforts and initial pilots can contribute to the diversification effort. This strategy can take place at the beginning of a Technology Adaptation Life Cycle if the product is a revolutionary high-tech product. Then the life cycle model can aid in determining what kind of documentation the users require.
Knowing what strategies a company is pursuing in general and adapting the documentation to those strategies is very important to gain recognition from management. Producing the same type of documentation as you produced before may not suit the customers’ needs or the goals of the company. Documentation organisations can support the company’s growth efforts by producing the right kind of documentation at the right time. What it all comes down to is knowing the users of your products. If you know the users and know your company’s strategic plans, you can be prepared for the new challenges and can contribute effectively to you company’s efforts.
Read more about the Ansoff Matrix and its use online where you can find many articles. One of the sites I found useful was http://www.nvq5.com/businessreview/ansoff.shtml.
Also, an extensive discussion of the matrix and its effects on the strategies and competencies of a company is available in Exploring Corporate Strategy (Prentice Hall 1999).
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This article is the personal opinion of the author and does not necessarily reflect the opinion or practice of Nokia.