Sunday, April 18, 2010


When this blog was originally mooted it was intended to cover purely personal development topics. But then it was decided to extend it to other management topics. And rather than waiting for topics in a particular order, to post whatever is at hand!

Product management is neither pure theory nor just practice. It is praxis! It is ‘practical application or exercise of a branch of learning’ - marketing. The scientist in the laboratory practices theory. The salesman in the field applies practical wisdom.


In the age of satellite communications when man can send a signal to the moon and receive its echo in a few seconds designing a global satellite phone is no ‘big deal’. At least that was what Motorola thought when it mooted the Iridium satellite phone project which eventually swallowed $ 7 billion.

It all started innocently enough when in 1985, Motorola executive, Barry Bertinger’s wife, unable to use her cellular phone while on vacation in the Caribbean, convinced her husband of the need for a worldwide mobile wireless system.

Motorola then joined with some partners to develop the Iridium global satellite phone. The phone that was five years in the making would work ‘anytime, anywhere’. The company spent $ 5 billion for developing and $ 40 million for launching the phone that would offer seamless communication in the Amazonian Rain Forest, on the Alaskan Tundra, or on the Himalayas. The point is very few people visit these places. What people in general want is something that fits into their pocket (physically and figuratively) and communicates with others.

The company did indeed conduct market research before launching the product. Its marketing team reportedly researched the social behaviour of ‘people on the move’ by interviewing 25,000 people - who fit the company’s customer profile - in 54 cities in 34 countries. The project needed 500,000 customers to break-even and when it folded nine years after launch it had 50,000.

The Iridium phone was bulky, needed a lot of attachments to work and cannot be used in cars or buildings. It might make sense to make it in limited numbers and market the product to army units of various countries but as a mass communication tool, it was a ‘no go’. (An Indian television channel reported the Kargil war using Iridium phones.)

The story of the Iridium fiasco does not end there. The 66 satellites that the company launched to provide it infrastructure support are still hovering in the sky. And Iridium’s marketing agent hard-sold the project to gullible Indian FIs who sank Rs 220 crore into it.


Doesn’t the Indian pharmaceutical industry have similar stories to tell? This was the question quite often asked while referring to the 'IRIDIUM FIASCO'. Well, here is an 'almost' story!

To succeed in life it is necessary to dream. It is necessary to dare to dream. People in sales should be practically optimistic but not gung-ho.

The sales manager of a company launching a typhoid vaccine hard-sold this idea to his management: India has a population of over 1000 million. Seventy percent of India’s population living in villages does not have access to safe drinking water and hence is prone to waterborne diseases like typhoid. A safe assumption of 70% of this subset gives us a figure 500 million doses as the market for typhoid vaccine. The company could easily target 10% MS in the first year and that would be 50 million doses.

Fortunately wisdom prevailed and the company did not order production based on the forecast. Three months after the launch it turned out that the company would have had  ten years’ ‘off-take’ on its shelves had it ordered production based on the optimistic sales manager's forecast!

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