A Primer in Business Intelligence

As a member of several groups at LinkedIn, I regularly receive emails offering anything from resume writing assistance to executive positions in my old industry, operations support systems software (OSS) for telecommunications providers. Yesterday, an offer of the latter crept into my inbox; any opportunity to regain a vice presidency of marketing deserves a ROI review, and this is no exception.

The VP of global sales for RateIntegration, inc. is seeking a VP of marketing for North America. Among other things, the position description says, "Individual must be equipped for high activity marketing campaigns and work multiple simultaneous campaigns. 10-15 years of successful track record marketing telecom OSS/BSS solutions resulting in measureable improvement in sales results is required." Seems all very nice, but let's dig a little deeper.

First, the company name leaves me confused. On their website, they are "rateintegration," yet the position request has "RateIntegration." Which is it? Or do they not believe that a consistent spelling of the company name is important? Perhaps their venture capital partners, Dolphin Equity Partners and JT Venture Partners, felt that would be too intrusive to mandate a modicum of marketing. But do they really lack marketing skills or is this an ingenious plan?

Some research into the executive management team shows the following pedigrees:

CEO: Bachelor's in Electrical Engineering, Master's in Information Management
CTO: Ph.D. in Computer Science (Carnegie-Mellon, no less!)
VP, Engineering: Bachelor's in Math (Harvard, no less!), Ph.D. in Computer Science
EVP, Finance and Strategy: Bachelor's in Electrical Engineering, MBA
VP, Product Development: Ph.D. in Computer Science
VP, Global Sales: Bachelor's from UC Berkeley

There is certainly no lack of scientific intellect, and at the same time, there is almost no marketing expertise. This tells me that the company is engineering/product focused, almost ensuring marketing myopia (cool product, no market). But what exactly is the product?

rateintegration (or RateIntegration) has developed a neat pricing/rating engine that would allow a telecommunications operator to create a separate usage plan for each and every customer. Imagine "Friends & Family" on steroids and hallucinogens. But who would want to do that? Mass customization only works when you can achieve the efficiencies of mass production with individual customization. Think of the difficulties encountered by Customer Service if every customer had a different rate plan! Yet, the technology is slick and has been adopted by some big players.

Evaluating their customer base, it can be seen that most are large companies with a few million subscribers and all are outside of this hemisphere. While the size bodes well for the software's performance, how will it work in the North America? Based on what I've read, it is questionable as to whether this software is economically viable for Tier 3 operators, but even if it is, what does that business model look like and how many rural phone companies need a NASA-grade pricing and rating engine? As to the larger customers, for the past decade, consolidation in the telecommunications industry has been unprecedented. Most of the Tier 2 operators (1-10 million lines) have been swallowed up by the Tier 1 players. And those Tier 1 companies have established contracts with either AMDOCS, Convergys (the two largest OSS software houses on the planet), or a major systems integrator like Accenture. If you are not working with them, you won't gain entry to the Big Dogs. Which leads me to the next issue - rateintegration is also looking for a VP of channel development, separate from a VP of marketing.

Anyone who has taken an introductory marketing course can explain the 4 Ps of all marketing strategies - Product, Price, Place, and Promotion. In the case of rateintegration, make that 3 Ps because Place, or the supply chain, is separate from the marketing function. How successful will any VP of marketing be in an environment where 25% of your strategy is outside of your control?

To top it off, RateIntegration is also seeking agents and resellers in every major market area around the world simultaneously: NA, EU, EMEA, and Asia. So what does all this information mean? What is the final analysis?

Here's my interpretation of the situation:

1. rateintegration developed a very neat product using venture capital that has unbelievable capabilities, some of which are even desirable by the marketplace.

2. Being a product-focused company, they worked their Rolodexes and found some initial customers. Because the product exceeds requirements and expectations, they are referenceable accounts of good stature.

3. As a group of engineers, they hired a sales person to expand the business. He's hit a brick wall, so now he's trying to hire marketing, channels, agents, and resellers. I find it interesting that the marketing position description calls for the ability to manage multiple campaigns, even before there is a strategy in place. Or have they already developed a marketing plan for the VP of marketing to implement? Maybe they should just outsource the project, because marketing reporting to sales has "doomed to fail" written all over it anyway. Where else would a marketing VP's compensation plan have a large commission component? Of course, "commission plan" tells us that the time horizon for success is very short. Which leads me to the finale...

4. All of this is in response to the VCs reluctance to provide additional capital. Perhaps the worst recession in 70 years has something to do with this new direction for rateintegration? Maybe if they were a marketing-focused company at inception they would be able to weather this storm. But they weren't and based on what I've read and analyzed, taking a job with them would be like betting against the house in Vegas.

I guess I'll just have to finish my MBA.