Until recently, a massive amount of data was simply thrown away because it was not economical to collect, store, analyze or interpret. But when more than half of the human race moved a major portion of its daily habits onto the Internet and more economical storage technologies evolved, a mountain of digital data began piling up data that can be mined for gold by forward-thinking strategic leaders.
“Several trends in market research are likely to have the greatest influence on strategic leadership in the next few years,” says Dr. Joseph Hair, professor, Kennesaw State University. “Strategic leaders need to be aware of and prepared to respond to these emerging trends.”
Smart Business recently spoke with Hair about how leaders, to be successful in today’s global economy, must be able to approach their work with a more strategic tactic.
How do you define strategic leadership?
It is the leader’s ability to anticipate and position his or her company for the future by mobilizing and focusing time and resources on tasks that make a difference and ensure future organizational success. Strategic leaders apply creativity, intuition and planning to help organizations identify and reach their goals. They think and act before they are forced to before they are in a defensive or reactive position. They also must know their customers why they do business with you and what they will be looking for in the future in an evolving market. Finally, they must be familiar with competitors and be sensitive to signals that provide insight about their own team, senior management and suppliers.
What factors are producing the information explosion?
Experts are forecasting that in 2007 to 2009 we will generate more information than we have in the past 1,000 years. The major factors causing this explosion of information is the increased data from retail point-of-sale systems, order entry systems and online purchases. But many other sources are generating tons of data including government, medical, financial, insurance, pharmaceutical, education and scientific sectors. One important enabling factor is the lower cost of data collection and storage. A study reported by the CIO of NCR concluded that in 1992 the cost of storing one megabyte of information was $15; by 2007, the cost was only 1 cent.
How will strategic leaders tap this mountain of information?
Strategic leaders in large and small organizations can convert what had been a ‘waste byproduct’ information into a new resource to improve decision-making and provide added value to customers. New technology will facilitate an expansion of the growing reliance on information/knowledge to improve decision-making in marketing and other functional areas of business. But knowledge-based decisions in marketing will be fueled by other developments, as well, including more comprehensive marketing research, real-time interactions between buyers and sellers that reduce response time, expansion and coordination of communication channels that enhance the ability to interact with customers, and the development of enhanced metrics to measure and benchmark performance. The result will be greater application of knowledge-based approaches and ‘one-to-one’ customer targeting.
How is this impacting customer decisions?
Customers have more and better information at their fingertips than they can even make use of in decisions. The challenge for Google and other popular search engines will be to design systems that help customers sift through and find the critical pieces of information probably less than 5 percent of the available information. With more than one-half of customers searching online before making a purchase, and 66 percent regularly watching TV and accessing the Internet simultaneously, marketers are able to collect data on these interactions and develop metrics to understand how search behavior ultimately impacts product and service choices. To remain competitive, strategic leaders in both consumer and industrial buying situations must understand and react to a better informed and more demanding customer.
How are buyers and sellers leveraging enhanced interconnectivity?
Real-time buyer-seller contact in which feedback is obtained and utilized almost simultaneously by both sides will be an integral part of marketing planning and, therefore, strategic decisions. Enhanced interconnectivity also will mean more and better methods of communication. Connections with customers via mobile devices as well as the Internet, WiFi and satellite-based communications will complement more traditional methods of conventional mail service, telemarketing and face-to-face selling.
How has this changed marketing research?
Global sourcing of marketing research services will increase substantially. Technology will enable companies to bypass existing research vendors and choose those that most closely meet their needs. Strategic leaders must embrace this global trend in outsourcing research because it will impact not only their bottom line but also the ability to respond to emerging opportunities.
DR. JOSEPH HAIR is a professor in the Marketing & Professional Sales Department, Kennesaw State University. Reach him at (770) 499-3280 or Jhair3@kennesaw.edu.