Client
A leading technical software vendor.
Challenge
Consider product profitability in resource decisions for development and marketing of products. Define the proper roles of
product profitability and long-term investment in resource decisions. Estimate profitability of products.
Solution
Compute product profitability based on revenue, development costs, support calls, and dedicated marketing and selling costs.
Combine product profitability metrics with management judgment in investment decisions in ways that reflect strategies of
business units.
Client Impact
Product profitability became a key metric for headcount decisions, but only when appropriate. Helped build consensus around
potentially contentious resource decisions.
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