Fundamentals and Processes become more important in a disruptive environment
“Disruption” is the buzzword today. Whether it’s the disruption brought about by the government through demonetization drive and new GST regime at economic level or the it’s disruption brought about by entry of new age players who topple strong companies with innovative products, we are living in a disruptive world. One of the fallbacks of these disruptions is that companies are becoming very short term rather than long term and strategic, and less importance is being given to fundamentals and processes.
Many consumer good companies are losing out to new age competitors who are launching innovative products and at better prices to consumers. While we say that these companies have lost out due to disruptions created by the new players, on the other side we should admit that the losing companies had weaker fundamentals and processes. A good company has sound processes of tracking their product performance with competition on a continuous basis and also continuous investment in discovering consumer’s unmet needs before and better than any other competitor does. Hence in consumer goods we will find examples of good brands losing where they failed in having strong fundamentals and also brands which continue to remain powerful due to staying connect with the emerging needs of consumers. Even in the B2B segment the companies which will succeed are the ones which can meet the needs of their customers.
Let’s talk about the one big disruption in the domain of marketing – digital media. There is no doubt digital media has been growing in significance with its ever increasing reach and share of consumption in the life of consumers, complimented by continuous technological advancement which is making this medium continue to grow. But we need to understand that digital is a only medium to communicate and also a channel to sell, but can never become more important than marketing itself and to that extent digital media is indeed sometimes overrated. Today any marketing seminar is becoming a digital media seminar with only presentations by digital agencies and Chief Digital Officers. One question to ask is can a digital media agency build a consumer brand by itself. And this is no offence to the capabilities of digital media people and to undermine its importance. But the reality is that fundamentally a brand becomes successful when it is able to understand and fulfill the consumer needs better than others. In this process a marketer would definitely need digital media to communicate better and use e-commerce channel to distribute in the emerging channel, but there will be need of good researchers to get the best insights, a strong R&D infrastructure to convert it into a strong product, strong creative communication, sales & distribution plan and many others in the processes. Even where marketers are investing more on digital media than the conventional mass media, they need to understand the digital media plan itself will be ineffective if the creative strategy is not in synergy with the digital medium which again signifies the importance of fundamentals and processes.
One more issue which will decide whether companies remain whether companies remain long term and not just short term is the stability of the senior teams. In organization where there is stability of the top team the chances are highly that the organization would be strategic as against where the teams change they will be managing their tenures only. Strong fundamentals and processes should only help companies win in the long run both in stable times as well as disruptive times as well.
(The Author is Saumitra Prasad, CMO, Kokuyo Camlin. Kokuyo is in the business of marketing and selling of art materials and stationery products under flagship brands ‘Camel’ and ‘Camlin’ which have been in existence for more than 80 years.)