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We live in a VUCA world – one of Volatility, Uncertainty, Complexity and Ambiguity, wherein traditional theory and best practice of marketing strategy formation are out of sync, says Claire Brooks, who has written a book – Marketing with Strategic Empathy – on the subject. She says the key challenge today is for organisations to focus on dynamic strategic learning, to equip managers and employees with the tools and skills to face this new paradigm.
Business executives learn the theory of marketing strategy formation in Business School. Fortune 500 corporations impose rigorous annual marketing strategy planning processes, lasting several months. Yet in a VUCA world of Volatility, Uncertainty, Complexity and Ambiguity, markets are now moving too fast for traditional models of strategy planning and market research. In a fast-paced environment like this, Fortune 500 global corporations increasingly use flexible, dynamic marketing strategy formation to cope with market disruption and the consumer’s hunger for change and innovation.
For example, my consultancy recently worked with a giant global technology company, renowned as a category disruptor. They had launched an innovative artificial intelligence-driven consumer device, which had far exceeded their market expectations. Long before the start of the annual planning process, the marketing, product, insights and ad agency stakeholders needed to adapt marketing strategy fast, to leverage their success and defend their brand against upcoming competitive launches through innovation. The core strategy team made important refinements to marketing strategy in less than three weeks, using a three-step process called the Strategic Empathy Process, to uncover deep insights about the brand’s emotional connection with consumers and rapidly activate insights into positioning, communications and innovation strategy.
Henry Mintzberg of the McGill University Faculty of Management (Mintzberg, 2007) first demonstrated that the strategic planning processes carried out by major corporations ignore the frequent reality that strategy formation is not a deliberate, planned approach, but is emergent, or a pattern of response by managers, employees and other stakeholders (such as ad agencies), which effects strategic change. In many successful Fortune 500 corporations, forward strategic planning is being replaced by strategic learning, which is an ongoing process of shifting strategy based on the existing knowledge and new learning of stakeholders at all levels of the organisation. In this new business environment, every manager, perhaps even every employee, must become a strategist and must develop strategic learning skills.
Nurturing marketing strategy
How do global corporations nurture strategic learning among managers, employees and partners? Fortune 500 corporations are investing in predictive and prescriptive data analytics to guide decision-making (Gartner, 2015).
However, data alone cannot help managers develop deep understanding of how consumers or customers think, feel or behave and why, to design effective products, services and marketing programs. Nor can data easily spark the personal and subjective insights and intuitions; the metaphors and mental constructs which, academics (Nonaka, 2007) have shown, are essential for successful innovation, as we saw in the prior tech case study.
My research over the last 12 years has shown that the key to profitable marketing success and growth is for managers across the organisation to develop deep understanding and insight – empathy – with consumers and customers within the broader context of their lives, as a basis for marketing strategy formation and activation.
The idea of Strategic Empathy was developed in my global consulting practice and at its core is the premise that managers, employees and other stakeholders can develop empathy with consumers and customers as a form of ‘muscle memory’ which facilitates dynamic, flexible and emergent strategy formation for marketing success.
A failure of empathy can lead to strategy chaos and failure – as I show in the opening case study of my book, about a US retailer, whose new CEO tried to impose retail strategies which had been successful with Millennial tech consumers, on middle-American moms! Seventeen months after his appointment, he was ousted by the board and the BBC dubbed him one of the most unsuccessful CEOs of the decade.
For effective strategic learning to occur, a systematic approach to deep insights and empathy-based strategic learning about customers and consumers is required. This is what my consultancy calls the Strategic Empathy Process. It nurtures strategic learning through a rigorous process of stakeholder team-based deep insights development and rapid strategy activation. The third, crucial step in the process requires socialisation of strategic learning across the organisation through strategic story-telling: that is, bringing learning to life in a way that builds empathy with a much wider stakeholder group and nurtures organisation-wide strategic learning.
This process is equally applicable to start-ups and SMEs as well as non-profit organisations. Non-profits have intuitive empathy for those they serve, but must turn empathy into strategic action to maximise donations. Entrepreneurs are Strategic Empathy natives, having typically founded their businesses based on deep insight and intuition for their customers. However, as their business grows, entrepreneurs must also invest in growing managers and employees into strategists, for dynamic marketing strategy formation and growth.
- Gartner IT Maturity Assessment Model, 2015.
- Nonaka, I (2007) The Knowledge Creating Company, Harvard Business Review, (July-August).
- Mintzberg, H (2007) Tracking Strategies: Towards a General Theory, OUP, Oxford.
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