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OPINION31 October 2012

Absence of evidence?

Opinion

“Evidence giving way to gut instinct” was the headline of one of our most popular articles this past month. But how true a reflection is it of the way companies make decisions, particularly at senior levels? Chris Dowsett investigates.

However, the idea that executives aren’t using data, intelligence or research in their decisions might be out of step with the reality in the boardroom.

Over the last few months, I have interviewed senior business leaders (directors, vice presidents and C-suite executives) to learn what research data they are using in their decisions and how they value different types of market data. My approach is to look at how data is accessed and how it’s used in a business environment to understand what value business leaders associate with different data types, including market research.

I’ve found that there is a growing appetite for data brought on by increasing sources of intelligence and the availability of business insights. In other words, business leaders have more choices when it comes to market intelligence – and market research is but one option on a longer list of possibilities.

Through my research, I’ve found that the decision regarding which data source to use is influenced by three factors:

  • The business leader’s personal experience with data collection methods (or team experience, if a team project)
  • The goals and market strategies of the organisation as a whole
  • The specifics of the project the person is working on

Past research from the Boston Consulting Group and other academic sources have pointed to organisational demographics as having a large influence. However, through my qualitative in-depth interviews, I believe that personal experience, organisational strategy and project specifics are the foundation of how a business leader determines what data to use.

This means that market research is employed in certain instances where the executive thinks the data will support the organisation’s goals and the project’s needs. In other cases, that same executive might go to social media data or web analytics.

One vice president of marketing I spoke to worked at a software technology company and accessed many different sources of data. He talked about the company’s approach to brand awareness and penetration, and about how the company’s strategy was solely focused on getting end-users to download a trial of their software.

He didn’t believe a brand awareness survey, for example, could be a valuable source of data to measure their brand. Instead, he focused on proportions of their target market that had tried their software and relied on database modelling and conversion statistics to measure brand growth from that viewpoint.

Alternatively, when the company looked at marketing and web content, he felt the best data source to inform those decisions came from their customer base, so they conducted surveys and interviews to understand their customers’ views on the organisation’s content.

My research has shown that data-based decision making is alive and well in the executive suite. Each business leader I have spoken to uses data regularly. However, each uses it in different ways and values different data formats. In fact, the use and value associated with data is about as varied as the number of sources of data available to executives.

Chris Dowsett is marketing intelligence and social platforms manager at Quantum. He’s studying a doctorate with USQ (Australia) that examines the value of research data to business leaders, how research is used in businesses and the value given to different types of data

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