Apr 05, 2005 12:44 AM
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(Updated Oct 25, 2005 10:46 AM)
Ever noticed an add for a marketing/ sales job?-Fire in the belly / A go-getter / Can you make the kill? / Target oriented /Aggressive?These are some of the punch lines they use to attract the right candidate.
What kind of a peaceful person in a sane world would want to have a job with such turbulent chaos in his life! Yet all of us working folk are either involved in selling or promoting or creating something to be later promoted and sold.
Business Strategy backed with sound market research and business analysis goes a long way in?pushing? a difficult product in the market and having many people buy it who at most might have had a latent need for the same.
But how effective is strategizing? How many times have we seen the historic business decisions turn into a catastrophies! The most recent episode is the firing of HP CEO Carly Fiorina. She fought a tough battle against one of the founder members to acquire Compaq to integrate its PC business with those of printers.
Sounds very sensible. But the result-HP?s share plummeted and ultimately the CEO was fired by the board and now HP is in a state of demerging Compaq. Of course Carly?s decision would not have been just her dream. She would have hired the most reputed MR agency and taken the services of the best of business analysts to study all the risk factors. But, ?she took a wrong decision.
HLL-Uniliver?s Indian subsidiary is the biggest Indian Consumer goods firm with almost unlimited R&D and Marketing and Advertising budget at its disposal. Yet it continuously bites the dust when faced with local competitors these days. The result-HLL?s CEO was amicably removed from the top job and given charge of the relatively insignificant market of South East Asia!
Gartner studies reveal that no more than 30% business strategies are wholly responsible for profit creation. The rest incur losses and except the market leaders, it?s not easy for the laggards and followers to sustain such losses. Where are we going wrong?
The answer lies not in how we do our research but what we research. We research the financial performances of companies, the industry, the sales figures, the consumer profiles. But are they really important? If these research reports are so accurate, why don?t all turn into profits? Take any firm?s last 5 year financial performance and try to study their revenue graphs. You are bound to see a dip in 2001-2002 revenues attributed to 9/11.Does this mean had 9/11 not happened, all firms would have performed well!
Add to it the concept of continual innovation and all strategies can go for a hike. Recently iPod was launched in India at a whopping price of INR 20, 000 for basic model. Obviously, the middle class waited for the prices to fall before they made their picks. But meanwhile, Nokia launched a low cost cell phone with mp3 player. The iPod has since disappeared.
I feel its time to upgrade to higher technological advancements in strategy formulation. Maybe its time to use market research as a secondary tool to back data warehousing and data mining techniques.
Studying customer profiles based on customer?s past buying patterns, identifying their behavior trends, judging their perception of value add and providing them today what they need today and tomorrow what their latent need is today, at a price they are willing to pay makes them sure winners. This method of targeting customers, technically called Business Analytics, currently in infancy stage in most countries, should go a long way in redefining strategy.
The age old saying-The customer is the king holds true perennially. Help the customer help your firm perform better and you have a win-win situation.
