Study challenges old beliefs about business growth

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Lynne Gordon | Managing Partner | Kantar Consulting | mail me


Organisations looking for growth in 2020 and beyond should question long-standing beliefs about business growth in favour of fresh new beliefs and behaviours. This is the outcome of the most comprehensive global study ever done, spanning 73 countries, interviews with 500 senior executives, 1,500 online survey contributions, and artificial intelligence analysis of over 3,500 pieces of literature

Growth is a perennial objective for marketers, who seek to create sustained, demand-led impact for their brands. But the days of assumed growth are over, and delivering it is more difficult than ever before.

In the current era of continuous disruption, low barriers to entry, markets reaching maturity and demanding consumers, marketers need to work harder than ever before to find new ways to grow.

Paradigm shifts

The truth is that there is growth to be found – but it lies beyond the comfort zone of business as usual. It requires courage, fresh thinking, and new behaviours to win.

The paradigm shifts that set growth over-performers apart from underperformers are:

From ‘obsessively chasing market share growth’ to ‘understanding how the market will evolve and gearing up for it’

Under-performers are more likely to chase market share growth as a signal of success. The reality is that many markets are ripe for disruption and reinvention.

Over-performers adopt an expanded long-term view on how the market will evolve. They make understanding the future a priority and consistently invest in gearing themselves up to win in the future.

East Africa telecommunications pioneer Safaricom looked beyond its dominant share in telecommunications to the convergence of telecommunications and financial services, disrupting the financial services first with M-Pesa Mobile Money and more recently with a savings and loans options, Masoko.

  • 85% of over-performers ‘assess and understand market developments’ vs. 33% for underperformers.
  • 44% for over-performers ‘focus on building market share’ vs. 55% of underperformers.

From ‘being fixed in one business model and rigid ROI metrics’ to ‘evaluating new business models with alternative ROI horizons’

Under-performers often put their faith in the ‘spreadsheet mafia’, a number-crunching force which shuts down ideas that don’t conform to existing business models and ROI formulas.

Over-performers are less rigid and empower employees to explore other business models and unpack the assumptions that underpin ROI, leading to new ways to make money.

Coca-Cola ‘s acquisition of Costa Coffee is a natural extension of its beverage business, but a different model. CEO James Quincey sees value combining Costa’s capabilities in retail with Coca-Cola’s global reach and marketing prowess.

  • 66% of overperformers ‘are willing to accept new business models’ vs. 38% for underperformers

From ‘chasing customer satisfaction scores’ to ‘continually evolving the customer experience and reducing points of customer friction’

Under-performers believe that if customers are satisfied, the business will do well. The reality is that the customer’s appetite for better, easier and faster will never be fully satiated.

Over-performs focus on finding new ways to eliminate friction in the full customer experience. Amazon founder and CEO Jeff Bezos said: “Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf.”

Amazon is always on the frontier of evolving customer experience, whether it’s Alexia or Dash.

  • 77% of overperformers ‘focus on delivering ever-evolving experiences’ vs. 22% for underperformers

From ‘accepting the cultural script as a fixed part of the corporate DNA’to ’embracing an evolving culture to win’

Corporate culture is a mix of beliefs and behaviours determining how company employees interact and engage.

Under-performers see culture as a behemoth, difficult to influence or. Over-performers are unafraid of changing the cultural script and share cultural traits of internal and external connectedness, entrepreneurship and innovation.

They value diversity at all levels and invest in training their people. Under the leadership of Satya Nadella, Microsoft is embracing a cultural shift; from technology focused to customer centricity: even corporate giants can move the culture needle!

  • 72% of overperformers ‘external connectivity’ vs. 38% for underperformers
  • 64% of overperformers ‘Have more diverse strategic decision–making’ vs. 40% for underperformers

From ‘fixating on internal battles and friction’ to ‘winning externally with agile empowered teams’

Under-performers are disproportionally bogged down in internal bureaucracy and battles, diverting attention from the rapidly changing outside world.

Over-performers organise themselves into small agile teams. They are more effective busting internal barriers and are more geared up to win externally. To stimulate agile innovation unperturbed by corporate red tape, Google set up an internal incubator called Area 120, an experimental program.

Google accepts that many of the novel ideas explored here will fail but embraces the opportunity to test the limits and learn something new.

  • 47% of overperformers ‘Prioritise the breakdown of internal barriers’ vs. 25% for underperformers
  • 64% of overperformers ‘Have more diverse strategic decision–making’ vs. 40% for underperformers

From ‘chasing bigger and better data in an analysis paralysis frenzy’ to ‘unlocking the power data with human insight and creativity’

Under-performers think that more data to explain the problem is the solution, but the reality in the information era is that data alone is a table stake.

Over-performers unlock the power of data, by pairing it with human insight and creativity, integrating a right-brained and left-brained view.

They do this by attracting whole-brained talent or constructing teams who are a mix of right-brained and left-brained individuals. South African insurance maverick Discovery’s pioneering behavioural insurance program Vitality has propelled outstanding business outcomes.

  • 64% of overperformers ‘bring technology and creativity together’ vs. 25% for underperformers

From ‘chasing profit as the end all and be all’ to ‘chasing purpose and human impact’

We’re all concerned with the pursuit of top-line growth in business. However, underperformers are disproportionately focused on the bottom line.

Over-performers look at commercial metrics but also consider the human impact of their business. They carve out a meaningful role for themselves in the lives of consumers, employees, and society.

Old Mutual has a clear human-centred purpose – ‘creating positive futures for clients, their families, communities and broader society’.  This human view has helped it become the largest player on the continent and the recipient of awards as a superior investor, brand builder, employer, and corporate citizen.


 

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