The payoff for successful marketing is supposed to be increased sales. One frustrating aspect of innovation services firms can be their inability to take advantage of all their marketing success. Ironically, success in marketing can actually create problems, along with sales.
Unlike a product company, the capacity of a service company is strictly limited by size — you can’t just crank up your machine and make more of what you sell. This is a great thing when you’re bootstrapping, but not so great once you’re established.
Atomic’s upfront team will handle three times the sales opportunities in 2011 as we averaged during the period 2006-2009. The dramatic increase is partly the result of how successfully we tell our compelling story. We can also credit being in business for 10 years, having a good reputation, high demand for repeat business from our happy customers, and a general under-capacity in our industry.
So what’s the problem with having 300+ opportunities but the capacity to deliver only approximately 75 projects annually? Unfortunately, there are several. First, it takes a lot of time to handle 300+ opportunities with care and attention. Second, it’s darn discouraging to work hard on a sale, knowing you may not end up having the capacity to complete the work. Third, every project you win creates the immediate need to sort out several internal complexities (putting together the right team, optimizing the strengths and availability of individuals, delivering within the customer’s time constraints, balancing the competing demands of other existing projects, etc). All of these complexities are exacerbated by constantly running at or near capacity.
On balance, the positives of being good at marketing outweigh the negatives, of course. I just find it ironic that there are in fact any downsides at all to successful marketing. As with most hard problems, this is one worth solving, and we’re experimenting with some new ways to balance demand, capacity, and our sales process.
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- Atomic Ownership, Part 3: Valuation - January 2, 2019