A view from the board room

Tom Long, head of Coca-Cola Great Britain, tells Mike Savage where he thinks researchers are going wrong

On the whole, the people who run companies tend not to be over-impressed with market research. In the eyes of company bosses, market researchers don’t seem to care whether the information they collect is useful or not. This is not to say that researchers are not good at what they do, but what they seem to be good at doing is producing backward looking tactical reports of no interest to board directors concerned with driving forward company strategy.

«The IQ of research people, their relative measure of intelligence, is higher than the average group,» one company chief says. «But their ability to project what they know into solutions for business problems is not as high as it should be because they’re myopic – they’re more tool-focused than implementation-focused».

This is the verdict of Tom Long, president of Coca-Cola Great Britain & Ireland. Long’s views echo those of many of his fellow bosses – that research is too slow, asks the wrong questions and fails to translate the answers into a language which decision makers can understand. However, rather than being a stranger to research, Tom Long is quite the opposite.

A former head of corporate marketing research, research and trends for the soft drinks giant, Long went on to become head of strategic marketing, overseeing brand strategy for Coke’s thoroughbred stable of soft drinks brands, before being promoted last year to run the British and Irish operation. Rather than run MR down, Long is a keen advocate who has passionate views based on years of experience of what market researchers must to do if they want to win favour with the board.

Getting more out of MR

«Research firms tend to take the output of the tool and say here’s the result,» says Long. «I think you can double the impact of research as we know it in fast moving consumer goods companies simply by demanding that those people who manage the inquiry tools of an organisation – that’s what I call the research function – ask the people whom they serve: ‘What do you want to know? What do you hypothesise about the outcome? What could be the four or five outcomes that you dream of? If those distinct outcomes came true what action would you take and why?’»

The first consequence of applying these tests, Long reasons, is that firms would soon realise that half the research they buy is worthless – a sobering fact that perhaps agencies should consider, as well as inhouse buyers. But Long sees bringing researchers and decision makers closer together as the first step in helping MR up the corporate ladder.

«The only way to grow that part of your business is to take those people involved in the inquiry process and bring them into the business by sharing information with them. They can be much more proactive in suggesting the inquiry that needs to take place, knowing the tools that can help you get to the truth. In that way they then begin to have a leadership role with the board.»

In high places

Research’s place on Coke GB’s top table, its executive committee, is physically in the form of an insights and planning manager. Culturally, the ex-researcher Long views the information which analytical research provides, alongside intuition and observation, as essential in helping the company chart its course. «You hope you have a very broad network of information points that give you a whole view of reality, rather than a view that involves just some portion of truth and a great deal of sampling error».

Long is confident that broadly speaking Coke is getting its research right. However, it does not follow that the contribution its insight and planning unit makes is infallible. «I’ve had campaigns that I thought were great and my research said was great, but didn’t make impact. And I’ve had campaigns that I didn’t think were so strong and our research said were not so strong, that had enormous impact.»

Long dismisses the idea that MR isn’t improving its standing with the board because it is middle management rather than company directors who are benefiting from the new ideas the research industry is coming up with. If MR can ensure the success of a marketing campaign or help redefine a brand’s positioning, then MR «definitively influences the board», Long argues.

However, researchers have a poor track record in devising tools that the board can use. Talking to a sample of 30 agency chiefs selected from the UK’s top 50 research companies in 1999, Cranfield School of Management’s Professor Robert Shaw found that only one of them had heard of the balanced score-card, an increasingly popular company report card among UK boardrooms, which combines sales and research data.

The card also potentially opens up a path for researchers that leads straight to the ceo. However, ceos like disparate sources of information to be pulled together to show the big picture, something management consultants seem far better at than researchers. Exploring ways of working together with other companies to provide a holistic market view should be at the top of research company agendas if they seriously want to make MR a boardroom issue, Shaw argues.

Tom Long agrees that consultants are displacing research agencies at board level because they are more in touch with the board’s needs. But a company which places a premium on knowledge assets can’t afford for this job to be carried out by an external supplier. «You have to have people proselytising every day,» Long explains. «If you gotta get religion, you gotta get it inside.» The board at Coca Cola Great Britain and Ireland sees MR’s main contribution to the balanced scorecard as being not so much to supply them with the data as to help them devise the measures that will be used on the next one.

«Creativity and ideas are what the board lives on,» Long enthuses. «We’re not just about just checking the next month’s numbers».

Out of place

Long adamantly believes that research does not belong in marketing, where its influence can be smothered by marketing concerns, or, as some have suggested, in the accounting department. «Finance comes at the end of our business,» he says. «The process of consumer inquiry comes at the beginning.»

Instead, research, which goes under the title of insight and planning, has been placed within a commercial practice and business planning arm. Implementing these changes, however, has not been an easy ride, either for Coke’s researchers or for other people within the business exposed to what research has to say.

«It’s absolute chaos. We’re changing everything. It’s very chaotic, stressful, it’s mentally taxing. We don’t all have common beliefs about the way our inquiry process ought to get done. We’re challenging each other all the time. Until we have systemised our belief structure and processed it so that we at least have manageable chaos, our people will say this is a very taxing place to work.»

Long personally enjoys the creative hot-housing that this turbulence produces, an environment he labels «constructive change». Nevertheless, he has responded to calls from employees for «30% more structure».

Coke GB’s ‘constructive change’ spotlights one of the key questions researchers must answer if they want to take a more leading role: are they cut out for the job?

Stuck in their ways

One leading clientside researcher, Randy Emond, worldwide director of customer and market intelligence for Philips Electronics, is not so sure. Emond, who carried away the best-paper prize at last year’s ESOMAR Congress for his thoughts on how MR can gain the ear of the board, thinks market researchers may have become too settled in current ways of working to adopt the dynamic new persona the inhouse researcher of tomorrow needs. «We’ve become successful doing tried and tested techniques,» Emond remarks. «The person who is going to be successful is coming in from outside the industry.»

To survive, Emond recommends inhouse researchers step outside their traditional roles, both literally, to gain a broader business perspective, and figuratively, to mesh together the seemingly conflicting roles of inhouse expert and external consultant.

But it isn’t just inhouse researchers who have to change, according to Tom Long. Agencies need to modify their outlook too if they are going to sell anything the new breed of researcher wants to buy. «Leaders of the research community need to be business people first and then develop the distinctive competency in research techniques. If they do that, they’ll double their impact.»

Despite all this, there are strong signs that the status quo may well prevail. There will be considerable resistance to such fundamental change and both Emond and Long believe only a handful of companies will embrace the new philosophy. The challenge for those companies willing to give this new thinking a go is to find the right people to run it. «If you don’t hire,» Long says, «in our business, fabulous research people who are big business thinkers, they die. They die because the brand people overwhelm them.

«If they come from most companies they wait for the brand people to tell them what they want. In our company it doesn’t work. If our research people aren’t highly proactive and really interested in being business leaders, they can’t work here. And that makes it really tough, because most research people are brilliant but not really that proactive.»

Which throws up the question: Where do you find these people?

Important part to play

«I don’t know yet,» says Long. «I’m trying. I’m trying really hard. I’ve got two really, really strong people who fit this mould right now. I think the most important thing is to give them the confidence that they have a vast role to play – much bigger than they can envision. I hope to help them so that we can co-create that place. I don’t know how it works because I am not any longer in touch with the tools they are using, but I know that if I can help them see a vision of themselves, and they are empowered to get it done, they’ll grow my vision and they’ll create it».

When the US-based Advertising Research Foundation asked two dozen business leaders in 1999 for their views on research, the results were dispiriting (see panel). The market research department was seen as a poor source of information, ranked below the finance, marketing, information services and human resources sections in terms of the quality of data it produces.

Researchers claim that they seek board-level recognition for the work they do but it seems they have yet to make this dream come true.

If what the head of Coca-Cola Great Britain says is true, they will need a lot more determination – and perhaps a little luck – to see the task through.l

US company bosses’ views

When the ARF conducted a qualitative study with ceos and presidents in 1999 it reported that senior managers generally held negative perceptions about MR.

A critical shortcoming identified was the failure to provide information that could be used to make decisions – MR information wasn’t seen to be as actionable as was the information provided by other corporate resources.

Sobered by these findings, the ARF commissioned a study to see how MR could improve its standing with the board. The just completed study produced six recommendations for the industry.

l Extend MR’s knowledge management roles to ensure greater accessibility to and actionability of the knowledge needed by decision makers.

l Improve your ability to articulate the forces affecting demand for your products and services and their business implications.

l Extend your understanding of the drivers of current and emerging demand to capture the opportunities inherent in the latent demand for your products and services.

l Take a more active role in establishing cross-functional forums to facilitate fact-based action planning.

l Establish an ongoing process to prioritise opportunities and delineate risks in order to improve marketing resource allocation.

l Set up a process to continuously review and adjust the fit between the research tools and the needs of decision makers.

Source: Redefining research to remain relevant, The Advertising Research Foundation, 2001

August | 2001