In an industry that is in charge of billions of dollars of assets, it’s crazy think that the current approaches to asset management are so far behind the curve.

For utilities, which manage facilities, pipes, lines, valves, meters, and many other physical assets, the need to adopt technology to prepare for the financial future couldn’t be greater.

Currently, asset management strategies are largely based on two approaches:

1. Inventory your assets- understand what they are, where they are, how old they are, and any other basic data. Put that into a software system (GIS, CityWorks, Lucity) so they can be visualized and managed.
2. Manage your assets (repair, replace, etc) based on their age– look at a typical or assumed end of useful life curve to figure out what to repair or replace. In other words, assume that an underground pipe is 50 years old and should be replaced in 10 years, because they last about 60 years total.

What’s the problem with this approach? It facilitates throwing massive amounts of money out the window! If an asset is replaced before it’s end of useful life, or isn’t replaced before a major failure, it will cost your organization money that could be prevented with strategic asset management approaches.

So what is the winning strategy? Managing your assets based on their condition, risk, and cost. What does that entail?

Condition– In other words, understanding the true condition of an asset before deciding how to repair or replace. Forget just relying on age- understand the condition (good or bad) of it before making a decision. Do this by looking at the age, the composition, the conditions surrounding it, and any other factors that could extend or shorten it’s like. Great example is an old car- do you need to replace an old car in great condition, just because it’s old?

Risk- Assets fail, so make sure to manage the highest risk assets. Which assets are critical to a system? Which assets would cause great financial impact to an organization if there was a failure? Prioritizing asset management based on the highest risk assets will ensure major risk reductions and optimization of repairing and replacing the right assets.

Cost– What are the costs to replace, reduce risk, and to optimize decisions? Organizations need to be able to quantify this for planning and day to day purposes. Speak the language that all of world speaks- money!

Using these principles for asset management will help organizations make smarter decisions, reduce risk, and save money.

We’ve all heard the stat that most startups are doomed to failure. Many times it’s because the wrong team is put in place. Sometimes it’s bad timing. Other times it’s funding, or unwillingness to pivot. But as I stated in my previous post, “How Big Is The Problem You’re Solving,” most startups just aren’t meeting a major market need. In other words, the pain of business as usual just isn’t that high.

But that’s not your startup, right?! You KNOW yours is a good idea, with a huge market to address and it solves a huge problem you’re very familiar with. RIGHT?!

You may not be able to know right away how big your customer’s problem is until you start discovery- in other words, sitting down with prospects and asking questions about their people, processes, and tools. And identifying where your solution and capabilities can match up with any gaps you identify. Overall, you need to stop building and start selling to be flexible and address the real needs of the market.

This process takes time, years even, depending on the structure of your sales and dev teams.

But there’s one question you can ask to know if you have a good idea or not, which is: are companies currently building and maintaining internal, “home grown” tools to solve this issue? If so, you might be sitting on a gold mine.

Home grown solutions are extremely common. Usually they are formed as projects by extremely smart employees simply because there’s no off the shelf tool or approach available. Some real world examples I’ve seen:

• Using Microsoft Excel to develop a capital project plan, Work Breakdown Structure (WBS), schedule, and budget- now solved by tools like Primavera P6, EcoSys, Planview, and other now major software providers
• Quantifying Environment, Health, and Safety data in an access database- now solved by dozens of EHS solutions like Enablon and Sphera
• Trying to quantify the condition of infrastructure using a workbook and basic statistics- solved by automated Machine Learning technology like Fracta

All of these companies are solving big issues using COTS, also known as Commercial Off the Shelf Solutions, and have been extremely successful. But why are off the shelf software products so successful? Two reasons- cost and scale.

These days, software can be created, deployed, maintained, and updated relatively automatically. This requires only a handful of resources from the software provider, who charges a company a nominal, annual fee. This approach is predictable and low risk.

If a company decides to build a tool internally, it requires a tremendous amount of resources to create and maintain. More developers, more subject matter experts, and more time. And the end result? Won’t contain all the updates and industry best practices a COTS will provide.

See your prospects fumbling with internal tools? You might also see green.

In a new survey by Inc,  it’s estimated that 42% of software startups fail. This means that as a salesperson coming in to scale a new product, you have almost a 1 in 2 chance of joining a company that will fail.

The cause is very simple- your product is not solving a big enough problem. No matter how great your dev team is or how much money you’ve secured, if you don’t have a large, addressable market with need for your product, you will fail.

As a salesperson that has had the experience of selling a product that didn’t meet a market need or solve a large scale problem, nothing can be more frustrating. You’re prospecting your ass off, getting people to discovery only to find out you just don’t have a compelling offering.

Management might tell you it’s your fault, that you aren’t selling it correctly or hard enough, and that there are plenty of people you should be able convince to buy your product (whether they really need it or not).

The company might be able to pivot, but it requires changing the management team’s strategic direction and abandoning the original plan, which could take years and money and time the company doesn’t have.

How to Avoid This Situation

To avoid this situation, take the following steps before you join the company. If you’ve already joined, note this as a valuable life lesson and try not to let it happen again.

1. Figure out who the company’s potential clients would be and find a contact that there that would evaluate the offering. They know the industry, the problems they face, and whether or not this potential offering would help them
2. Ask existing or previous sales reps there about how clients have received the offering. Also, are they meeting their quota?
3. How many clients are out there that would buy this offering? Harder to ascertain, but easy to run some quick calculations based on available territory, target companies in each sector, etc.
4. Find out what the deal size is and multiply that by the number of companies

After you run the numbers, are you looking at something small or significant?

• Less than $1,000,000- very small
• Between $1,000,000-$5,000,000- small but potential for promise
• $5,000,000 and $10,000,000- great potential

Selling a new product that solves a big problem with a big market size will ensure your sales success.