Looking at a new strategic plan for your business?  In this article, Eric Sink, of SourceGear, examines the decision process for starting a new software product company.  I found the article insightful when it comes to starting a new business or a new project for an existing business.  He makes four points: know thyself, have a failure plan, choose your product, and make the numbers add up. Find the complete article at Microsoft's ISV Community Center. I particularly like the section on vertical markets. Sink explains

"In marketing we use the terms "horizontal" and "vertical" to describe two different kinds of products and market segments:

  1. A horizontal product has very broad appeal. It can be applied across a wide variety of businesses. Microsoft Excel is a horizontal product. Almost everybody in every possible field uses Excel.
  2. A vertical product is one that is specifically designed for a single market segment or niche. Dental office management software is a vertical product. Nobody outside dentistry uses it.

In the '80s and '90s, small ISVs could realistically enter a horizontal product market. But today, as the software industry has matured, it is far more difficult to compete with the big companies for the attention of mainstream customers. Horizontal product markets are filled with the wrong kind of competition for you.  The competitors you want are in the vertical markets. These markets are safe from the big companies like Microsoft."