Avoid Market Myopia – Practice Seeing Around Corners

A few weeks back a retired former Chief Executive of Woolworths was berating the poor performance of the soon to be departing incumbent CEO, in particular the latters’ poor understanding of the company’s customers. He said ”In my day I spent 3 days every week in stores, even Coles”. No doubt an admirable practice for his time but one that would be difficult to adopt today without neglecting so many the other demanding functions of the position.

However, he does have a point. No business can avoid coming to grips with the rapidly evolving changes in its markets and keeping abreast of innovation that can create a discerning point of difference or lower costs. The spectrum of choices is broader than ever, happening rapidly and often dramatically. Activities that companies have relied on for years can suddenly be offered by competitors better, cheaper, faster, and more creatively.

An example is social and electronic media. Everyone in business and socially has been touched by their revolution. We all use them every day. In business we can ‘talk’ to our customers instantly without getting out of our chairs. But while the potential of them is immense, the risks in relying too heavily on them can blind side users by short-circuiting the established power of traditional lines of communication. As valuable as they are there is no substitute for intelligence gained first hand on the ground.

As the retired Woolworths chief was trying to illustrate, there is still a crucial need to get out in the market place to find out what is going on around the corner. There is no substitute for understanding your customers’ needs, uncovering others’ innovative ideas, and building relationships than meeting people face to face. People interaction is an investment not a cost. Efficiently handled, it is low risk. Nothing beats getting a firsthand sense of what is going on in the market than by visiting your own and competitors’ clients. National Australia Bank’s new CEO has decreed that its senior managers, presumably no matter what their positions are, be allocated major clients to account manage and keep them in touch with the market.

In our fast changing world going into the field affords the opportunity to personally test our strategy for currency, challenging whether our coherent compelling story is moving with the changing character of our markets.

To remain on top we must continually gain an insight into what needs to change to keep us ahead of competitors. Change inevitably necessitates doing things in the future we have not done before, bringing innovation to the fore. We all need to anticipate the changing nature of market dynamics into the future – environmental, social, competitive, products and services.

Foresight, insight and innovation are the key resources underpinning good strategy. Without these we will not be able to see around corners. Keeping our fingers on the pulse of change is best gained out in the field.

 

The author of this article is Ken Meek, a BCD mentor and Principal of M2 Strategic Management.

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