| Client |
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 joined investment potential as a key metric for headcount decisions. Helped build consensus around potentially contentious resource decisions. |
related modelsheet model
A ModelSheet application on our website implements the basic product profitability model. It includes revenues and costs of product development, product support calls, and marketing that is directly attributable to products.
