Changing Decision Making (and Leadership)
Many of us have grown up in the consumer packaged goods (CPG) industry surrounded by leaders who have worked their way up from the bottom, and understand multiple aspects of the business. These individuals have historic knowledge on how things get done. They have experience in what marketing campaigns worked and which ones didn’t. They are inextricably linked to the success of the enterprise in which they operate.
Fast forward to today. It’s all about data! Big data, and the insights of that data. This is the time when data has made those experiential learnings less relevant than ever. Those former leaders are still making gut-based decisions, based upon their prior experience. Unfortunately for them the information that they once thought they knew has moved.
This is a classic “who moved my cheese” story.
So what is really happening today? Consumers have more choices and are demographically more diverse in their thinking and behaving than ever before. It is no longer acceptable to say the ethnicity of a group drives their purchasing behavior. It simply does not. It is the life experiences of many second and third generation adults (now the millennials) who have grown up in the United States and are behaving more like mix of cultures than one in particular. A simple example is in 2013 Salsa replaced Ketchup as the number one condiment in the United States. That meant that more consumers are devouring salsa and enjoying Latino foods than ever before.
What are the implications? Well, it all depends on who you are and how sensitive your consumers are to stimuli around them. With the increased source of information coming to our consumers through social media, it is no longer our controlled marketing publications that are influencing the decision making of our consumers. Therefore, we must read the data, analyze what it is saying to us and derive the insights from these.
The “old school” leaders of the past are finding themselves out of water. Big data is king, and the insights that you can derive from them are the new game in town.
This is then when instant data trolling of disparate data on the Web becomes important. Firstly, we need to analyze current sentiment and then predict future opinion given certain stimuli. Then can your leaders adjust quickly enough and change the stimuli to get the result that they want or not?
So, are the leaders we have today ready for the challenges of the future? Are they adept enough to filter what insights are more important than other data? Or are they still managing on their gut instinct, from 20 years of history?
How many of our current industry champions are about to face their Kodak Moment? That moment, when the environment around them changes so fast that they cannot keep pace and they are usurped by changing times, changing consumers and pent-up demand for something new.
Software upgrades have been going in cycles that cause paradigm shifts in the implications for all consumers. The time between these cycles seems to be shortening. We started with the advent of mainframes, then to personal computers, and then to client servers and now... to cloud computing – aka Back to the Future, where large scale mainframes and servers are amassing large quantities of data anywhere in the world because of the Internet. So, what does this paradigm shift mean?
It allows new businesses to ramp up and become global players in a much more real and meaningful way, at fractions of the cost of prior businesses. Today, these upstarts don’t have to buy the entire infrastructure; they can rent it on an as-needed basis. And it will always be state of the art, because that will be included in their agreement.
So, the CPG industry seems to be trying to do two fundamental things. Trying to remove its old school gut managers and replace them with data jockeys, and secondly trying to outsource their technology, big data and insights groups. Whoa! Not too fast there Nelly... there is one critical piece that these leaders are missing. They need to find bleeding edge data scientists and category managers, who know how to cobble the big data systems together, and who know how to apply the insights in the right way to ensure they are actionable.
Actionability of the insights will always be the key. But you have SVP and above leaders who rely on their gut instincts trying to make big data plays, when they actually don’t understand the flow. Now, enter your change agents. These individuals are hard to find. They know both sides of the coin and can assist not only in developing a strategy, but can help your organization implement them to be actionable now and in to the future. Many of these types of folks float around conferences such as Consumer Goods Technology’s conferences, but their leaders don’t know who they are. They will need to be nurtured and guided out to become the effective change agents that Wall Street and the consumer will demand of these CPG companies.
ABOUT THE AUTHOR
Tony van der Hoek has had an 18-year career with the Coca-Cola Company, developing and leveraging their Big Data and advanced analytics with large global customers (Walmart, 7-Eleven and McDonald’s to name a few). In 2013, he was recognized by Consumer Goods Technology as one of their industries Visionaries. Today, van der Hoek has now entered the entrepreneurial space by being a Coach Mentor at one of Atlanta’s premier incubators the Atlanta Tech Village. In addition to consulting, van der Hoek is pioneering work with start-up companies in the BI space for sustainability, and daily deals aggregation. Visit www.hoeksinternational.com for more information.
Fast forward to today. It’s all about data! Big data, and the insights of that data. This is the time when data has made those experiential learnings less relevant than ever. Those former leaders are still making gut-based decisions, based upon their prior experience. Unfortunately for them the information that they once thought they knew has moved.
This is a classic “who moved my cheese” story.
So what is really happening today? Consumers have more choices and are demographically more diverse in their thinking and behaving than ever before. It is no longer acceptable to say the ethnicity of a group drives their purchasing behavior. It simply does not. It is the life experiences of many second and third generation adults (now the millennials) who have grown up in the United States and are behaving more like mix of cultures than one in particular. A simple example is in 2013 Salsa replaced Ketchup as the number one condiment in the United States. That meant that more consumers are devouring salsa and enjoying Latino foods than ever before.
What are the implications? Well, it all depends on who you are and how sensitive your consumers are to stimuli around them. With the increased source of information coming to our consumers through social media, it is no longer our controlled marketing publications that are influencing the decision making of our consumers. Therefore, we must read the data, analyze what it is saying to us and derive the insights from these.
The “old school” leaders of the past are finding themselves out of water. Big data is king, and the insights that you can derive from them are the new game in town.
This is then when instant data trolling of disparate data on the Web becomes important. Firstly, we need to analyze current sentiment and then predict future opinion given certain stimuli. Then can your leaders adjust quickly enough and change the stimuli to get the result that they want or not?
So, are the leaders we have today ready for the challenges of the future? Are they adept enough to filter what insights are more important than other data? Or are they still managing on their gut instinct, from 20 years of history?
How many of our current industry champions are about to face their Kodak Moment? That moment, when the environment around them changes so fast that they cannot keep pace and they are usurped by changing times, changing consumers and pent-up demand for something new.
Software upgrades have been going in cycles that cause paradigm shifts in the implications for all consumers. The time between these cycles seems to be shortening. We started with the advent of mainframes, then to personal computers, and then to client servers and now... to cloud computing – aka Back to the Future, where large scale mainframes and servers are amassing large quantities of data anywhere in the world because of the Internet. So, what does this paradigm shift mean?
It allows new businesses to ramp up and become global players in a much more real and meaningful way, at fractions of the cost of prior businesses. Today, these upstarts don’t have to buy the entire infrastructure; they can rent it on an as-needed basis. And it will always be state of the art, because that will be included in their agreement.
So, the CPG industry seems to be trying to do two fundamental things. Trying to remove its old school gut managers and replace them with data jockeys, and secondly trying to outsource their technology, big data and insights groups. Whoa! Not too fast there Nelly... there is one critical piece that these leaders are missing. They need to find bleeding edge data scientists and category managers, who know how to cobble the big data systems together, and who know how to apply the insights in the right way to ensure they are actionable.
Actionability of the insights will always be the key. But you have SVP and above leaders who rely on their gut instincts trying to make big data plays, when they actually don’t understand the flow. Now, enter your change agents. These individuals are hard to find. They know both sides of the coin and can assist not only in developing a strategy, but can help your organization implement them to be actionable now and in to the future. Many of these types of folks float around conferences such as Consumer Goods Technology’s conferences, but their leaders don’t know who they are. They will need to be nurtured and guided out to become the effective change agents that Wall Street and the consumer will demand of these CPG companies.
ABOUT THE AUTHOR
Tony van der Hoek has had an 18-year career with the Coca-Cola Company, developing and leveraging their Big Data and advanced analytics with large global customers (Walmart, 7-Eleven and McDonald’s to name a few). In 2013, he was recognized by Consumer Goods Technology as one of their industries Visionaries. Today, van der Hoek has now entered the entrepreneurial space by being a Coach Mentor at one of Atlanta’s premier incubators the Atlanta Tech Village. In addition to consulting, van der Hoek is pioneering work with start-up companies in the BI space for sustainability, and daily deals aggregation. Visit www.hoeksinternational.com for more information.