Strategy & Consulting
AI Prompt Templates

An issue tree breaks a broad question into smaller questions that are MECE (mutually exclusive, collectively exhaustive): no overlaps, and nothing left out. Applied to Northwind, it separates the symptom, slower growth, from its root cause in net revenue retention (NRR): the percentage of last year’s revenue that existing customers still pay this year, after upgrades, downgrades and cancellations.

• At 118% NRR: existing customers added 18% to revenue each year through upgrades, so sales needed only 22% from new business to reach 40% growth.
• At 96% NRR: Northwind loses 4% of existing revenue a year, so reaching 40% growth would require 44% from new business just to offset the loss.

Takeaway: investigate which customers are cancelling and why, before changing the sales team or spending more on acquisition.

A five-dimension diagnostic rates People, Process, Positioning, Performance and Pipeline separately, and evidence grading requires each rating to rest on data rather than internal opinion. Northwind’s leadership blames the sales team and praises the culture; the data says otherwise.

• People (Strong): quota attainment, ramp time and rep retention all match the 40% growth year.
• Positioning (Critical): positioning is the market a product is built and sold for. Northwind’s product suits firms that buy on time saved, but its acquisition channels deliver price-sensitive buyers who take minimum seats and never upgrade.
• Process and Pipeline (At Risk): both are weakening as a consequence of the positioning mismatch, not as independent sales failures.

Takeaway: fix which buyers Northwind acquires. Replacing the Chief Revenue Officer would not change the type of customers coming in.

Porter’s Five Forces assesses the competitive pressure in an industry through rivalry, new entrants, supplier power, buyer power and substitutes; the competitor analysis then examines one rival on four vectors: product, sales model, positioning and hiring. Vertex leads on brand but lags on product, because it ships updates slowly.

• Timing the threat: hiring precedes market entry by several quarters. Vertex has only just begun hiring mid-market sales reps, so it did not cause Northwind’s 22-point retention drop.
• The exposure: Northwind has no retention plan for its mid-market core, the segment Vertex’s new reps will target first.

Takeaway: treat Vertex as a risk to next year’s renewals, and build a retention plan for mid-market customers now.

Bottom-up market sizing multiplies the number of buyers by seats and average contract value, and produces three figures: total addressable market (TAM), serviceable addressable market (SAM) and serviceable obtainable market (SOM).

• TAM, $1.2B: total annual revenue if every potential buyer in the category purchased.
• SAM, $630M: the part of the TAM that Northwind’s product and channels can actually serve.
• SOM, $19M by year 3: the new revenue Northwind can realistically win against its competitors with its current sales capacity. At $40M ARR against a $630M SAM, market size is not the constraint.

Takeaway: the market is large enough for Northwind to grow. The priority is winning more firms that bill by the hour: the most profitable segment and Northwind’s ideal customer profile (ICP).

A market-entry assessment scores strategic fit, compares entry modes (build, partner or acquire) and ends in a go/no-go decision. The adjacent RevOps segment, the revenue operations teams that run sales and marketing systems, scores 6 out of 10 on fit.

• Entry mode: partner-led. Building an in-house RevOps sales team would cost more in year one than the segment returns, so entry starts with micro-businesses referred through existing partners.
• Conditional go: the budget is released only after a 60-day pilot proves RevOps buyers will switch vendors.

Takeaway: enter the RevOps segment through partners, and release the budget only after the 60-day pilot succeeds.

The Three Horizons model divides a portfolio into Horizon 1, the core business that earns today’s revenue; Horizon 2, emerging opportunities; and Horizon 3, longer-term bets. At Northwind, Horizon 1 funds RevOps (H2) and the platform bet (H3), yet receives the least investment.

• 9-box portfolio: a grid that rates each business line on market attractiveness and competitive strength. The small-business (SMB) tier scores low on both: low contract values, high support load, no expansion path. It survives only because closing it would reduce reported revenue.
• The divestment: the SMB tier is where the bad-fit customers from the ad channel in step 7 end up. Cutting the channel without closing the tier keeps the losses; closing the tier without cutting the channel keeps acquiring them. Both go together, to fund the ICP refocus.

Takeaway: close the SMB tier and cut the ad channel at the same time, then move that money into the core business.

A root-cause diagnostic tests possible causes in order, market, positioning, conversion, retention and capacity, to find the binding constraint: the single factor that limits growth. At Northwind it is one paid ad channel whose customers churn at three times the base rate.

• Cohort churn: a cohort is a group of customers acquired through the same channel or in the same period. Healthy accounts churn about 12% a year; the ad cohort exceeds 35%. It converts easily, so the channel looks successful until the 12-month renewal.
• Segmented NRR: split by cohort, the mid-market core is still expanding at 112%. The retention decline sits in the SMB accounts this channel delivers.
• The cost of more ad spend: increasing spend on this channel acquires more of the customers who cancel within a year.

Takeaway: stop the paid ad channel now, improve onboarding for high-value accounts, and do not increase ad spend to replace the lost revenue.

Each option is scored 1 to 5 on four criteria, impact, effort, confidence and fit, and plotted on an impact-effort 2×2 matrix to show which delivers the most for the least. Refocus on the ICP scores 5 on impact and 2 on effort.

• Move upmarket (4/4/3/3): competes directly with Vertex’s enterprise strength.
• Acquire a rival (5/5/2/3): requires capital Northwind does not have.
• Do nothing (1/1/5/1): scored honestly, as the baseline the board is entitled to see.

Takeaway: refocus on the ICP: it needs no new capital, avoids competing with Vertex for enterprise customers, and moves budget to accounts that already grow.

An assumption audit sorts every assumption as validated, unvalidated or contradicted, and flags the load-bearing ones: those the plan fails without. Northwind’s is that it can refocus on the core without disrupting it.

• Pre-mortem: assuming the plan has already failed and listing why. The likeliest reason: the $2M reallocation touches the same mid-market accounts renewing at 112%, and a poorly managed transition turns an SMB churn problem into a core churn problem.
• War-game: anticipating a competitor’s response. Vertex is likely to answer with price cuts aimed at the same mid-market accounts.

Takeaway: run the refocus as a 30-day pilot with stop criteria agreed in advance, before committing the full $2M.

The Pyramid Principle puts the answer first and the supporting arguments beneath it; the SCRAP structure orders the memo as Situation, Complication, Resolution, Action and Proof. Northwind’s answer: the slowdown is a contained retention problem driven by one acquired cohort, and refocusing returns growth to 25%.

• The ask: approval to reallocate $2M, 5% of revenue, from the eliminated ad channel and the closed SMB tier. No net-new funding is required.
• Board Q&A: prepared answers to the board’s hardest questions. The first will be that last year’s plan increased ad spend; the answer is that last year’s plan acquired the churn this plan removes.

Takeaway: open the board memo with the recommendation and the $2M request, and prepare the answer to the ad-spend question in advance.