Scenarios in Marketing: From Vision to Decision - Rilegato

Piercy, Nigel; Payne, Adrian

Rilegato

ISBN 10: 0470032723 ISBN 13: 9780470032725

Casa editrice: John Wiley & Sons Inc, 2006

Riassunto

You've chosen this book. Which probably means you're a marketer, you've heard of scenarios and you want to know what they can do for you. Can they help with everyday marketing issues like brands, channels and relationships? The answer is yes. Rooted in customer needs, scenarios bridge the gap between corporate strategy and marketing tactics. They are a weapon for perceiving the unseen and a framework for thinking the unthinkable. This book's wealth of case studies will show you how they've helped top companies like Pfizer, Nestle and Courvoisier to do just that, and its practical lessons will show how they can do exactly the same for you.

Gill Ringland and Laurie Young have gathered top-flight contributors to offer the first straightforward account of scenario planning for marketers. In readable chapters they show how, by integrating scenarios into the wider marketing toolkit, you can make your organization more customer-driven and consider a wider range of possibilities than your competitors. They explore how scenarios have driven creativity in a range of consumer marketing applications - even in FMCG sectors - and define their role in distribution, channel management, brand management and customer management strategy. Finally, they show how marketing scenarios can help to promote wider corporate innovation.

The rich pictures painted by scenarios have made business strategy more visionary and creative, and they're set to do the same with marketing strategy. Read this book, and make sure it's your organization holding the brush.

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Informazioni sull?autore

About the authors

Gill Ringland is an expert in scenario planning. After research at the University of California, Berkeley and as a Fellow at Somerville College, Oxford, Gill had a career in the IT industry. As Head of Strategy at ICL, she used scenarios to understand the complexities of the information and communications industry and map ICL's future. Since 2002, Gill has written and consulted widely as Fellow and Chief Executive of St. Andrews Management Institute (SAMI). She is the author of three previous books – Scenario Planning (now in its Second Edition), Scenarios in Business and Scenarios in Public Policy – all published by Wiley.

Laurie Young is a specialist in the marketing of services and customer care. His career includes senior positions with PricewaterhouseCoopers, BT and Unisys. In the 1990s he founded, built and sold his professional services company specialising in services marketing. Over the years he has advised a number of major international blue-chip organisations on the contribution of services marketing programmes to shareholder value. He is the author of Marketing the Professional Services Firm, also published by Wiley.

Dalla quarta di copertina

To create Scenarios in Marketing, Gill Ringland and Laurie Young have called on the expertise of highly-respected contributors, and the lessons of leading-edge case studies:

THE CONTRIBUTORS

• Lloyd Burdett, Associate Director, The Henley Centre Ltd.
• Andrew Curry, Director, The Henley Centre Ltd.
• Paul Fifield, The Paul Fifield Organisation Ltd.
• David Haigh, Chief Executive, Brand Finance Plc.
• Crawford Hollingworth, Founder and CEO, HeadlightVision Ltd.
• Don E. Schultz, President, Agora Inc.
• Merlin Stone, Director, WCL
• Tim Westall, Founding Partner, April Strategy Ltd.
• Neil Woodcock, Director, WCL

THE CASE STUDIES

• Exploring assumptions at D2D
• Developing new business streams at Electrolux
• Scenarios in arts marketing
• Marketing strategy at Pfizer
• Using real environments to model the future
• Hathaway shirts
• Strategies for mobile commerce
• Telephone directories
• IT &;Hardware&;
• Global personal product range extension
• European frozen food innovation
• Tesco
• Nestlé Rowntree
• Courvoisier

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Scenarios in Marketing

From Vision to Decision

John Wiley & Sons

Copyright © 2006 John Wiley & Sons, Ltd
All right reserved.
ISBN: 978-0-470-03272-5

Chapter One

Introduction to Scenario Planning

Gill Ringland

SUMMARY

This chapter answers three questions:

• How can this book help you?

• What is a scenario?

• How can scenarios be used?

It defines scenarios and gives the theoretical and experimental underlying basis for their application. It also contains a discussion of when not to use scenarios.

The chapter is contributed by Gill Ringland, the author of several books on scenario planning and the chief executive of SAMI Consulting, which aims to help its customers to make robust decisions in uncertain times.

HOW CAN THIS BOOK HELP YOU?

You have opened this book because you are a marketer, who has heard about scenarios and want to know what they can do for you. Can they bring both creativity and discipline both into marketing? Can the use of scenarios make your organisation more successful?

It's well known that scenarios have made headlines by helping to anticipate events, improving the ability of an organisation to get ahead of the curve. For example, scenario planning has helped:

• Pacific Gas and Electric to prepare for the earthquake in California;

• Shell to anticipate the fall of communism in Russia and its effect on natural gas prices;

• countries such as Guatemala and South Africa to defuse tensions and map a way forward.

These examples suggest that scenarios work over a long timescale in large geographies. Is scenario thinking then relevant to the types of problems tackled by marketers? The answer is "Yes". Scenarios allow you to explore alternatives to "the official future", which is the set of shared assumptions about the future in the organisation. This official future is usually more comfortable, and hence more potentially misleading, than other possible futures or scenarios.

In Scenario Planning, Gill Ringland (2006) has described a number of marketing case studies where scenarios were developed that effectively challenged "the official future":

• Erste Allgemeine Versicherung, the Austrian insurance company, anticipated the fall of the Berlin Wall and entered new markets in central Europe. • KRONE, the wiring and cable supplier, developed 200 new product ideas.

• Unilever decided on marketing strategies for Russia and Poland.

• United Distillers (now Diageo) set market strategies for India, South Africa and Turkey.

• Electrolux spotted new consumer markets.

The purpose of this book is to provide a straightforward account of the use of scenarios, oriented towards the concerns and disciplines of people facing marketing decisions. It is intended for marketing practitioners who want to get a view and experience of how to use scenario techniques. It will also appeal to corporate planners and MBA students, as it shows how scenarios fit as part of the marketing tool kit, spanning the space between the signals from the outside world and decision making (see Figure 1.1).

MODELS OF THE WORLD

Scenarios are just one example of using models of the world to explore or anticipate "real life". For instance:

• Wind tunnels are used to test car shapes for aerodynamic features. Does the car become unstable at high speeds, and does it have higher or lower drag factors than other shapes?

• In fatigue tests for airframes, either a life-size airframe or a scaled-down airframe is subjected to stresses and strains in a test rig, where early signs of cracks, fractures or breakages can hopefully be encountered before they are seen in the airframes that fly passengers.

• Mathematical or computer models are used to schedule and allocate resources, within sets of constraints. Linear programming techniques are used to solve problems such as forest management, agricultural production, production planning in factories, and even the selection of hospital menus.

It is clear from these examples that whether physical or computer modelling is used, the predictions for real life are only as good as the ability of the model to contain enough of the rules and constraints of real life. Thus, for instance, a model based on fixed proportions of income being available for discretionary spend, as a way of calculating the market for luxury goods, would cease to be applicable if changes in lifestyle meant that increasing proportions were in fact being spent on food, through eating in restaurants or snacking on the move (Moore and Hodges, 1970).

Two aspects of a successful model are suggested by these examples:

• The ability to anticipate real world behaviour—which may be unexpected—through exploring the constraints or changes in the external environment, or the relationships between forces.

• The creation of a mental model which allows the user to look for early confirming or disconfirming evidence.

In the case of the airframes that are used to fly passengers, the model could identify the weaker section of the frame and indicate when (after how many flying hours) to look for signs of stress.

In the case of the market for luxury goods, the model might cause the distributor to investigate the cultures in which this change might occur.

How Can Marketers Get Better Models of the World?

This is a difficult question. If we compare good marketers with the Israeli Intelligence Service, for instance, we can look at what happened in the run up to the Yom Kippur War. This example of the difficulties in maintaining a view of alternative possible forms of threat, and hence the ability to react to signals, is given by Cohen and Gooch (1990). It describes how the Israelis, in spite of a superb intelligence operation, were essentially taken by surprise by the Arab attack during the war.

So, how can we avoid being taken by surprise?

Consider the approach taken by the Prussian military thinker Carl von Clausewitz—a major strategic theorist. He became interested in the effect of chance and uncertainty on war because the "juggernaut of war, based on the strength of its entire people" defined a new era. War had become one of the largest and most complex of endeavours, and in this context he dismissed the simplistic use of mathematical techniques, which he suggested illuminated tactics but not strategy. On the topic of how to act boldly despite the inherent uncertainties of war, he suggested making "an educated guess and then gamble that the guess was correct". For a more detailed analysis, see Herbig's article in Handel (1989).

In this context, then, it could be said that scenarios improve the quality of the educated guesses and also provide a framework for deciding what the implications are, and when to gamble.

In Chapter Four and Chapter Eight, and in Appendix One, we discuss some of the methods that have been developed to try to improve the quality of these educated guesses in a marketing environment.

WHAT IS A SCENARIO?

Think of a scenario as a fairy tale or story. Michael Porter (2004) defined scenarios as:

"An internally consistent view of what the future might turn out to be—not a forecast, but one possible future outcome."

A good set of scenarios are plausible in that they can be "imagined" in terms of current, visible, events or trends that might cause them to happen; the set should not only include a visionary (or normative) scenario, but also some scenarios that challenge the organisation. Scenario planning is the art of using scenarios for decision-making.

The Experimental and Theoretical Basis for Scenario Thinking

Scenario thinking explores the future in a way that provides not only plausible and consistent but also qualitatively different views of the future. Scenarios allow default assumptions to be surfaced and discussed. As an example, see the discussion over business plans at D2D (see Case Study 1.1).

What Works and What Doesn't

Over the years practitioners have built up a number of rules of thumb on what works and what doesn't.

• Scenario thinking needs to take in a wide range of potential inputs to provide a useful basis for decisions. This may mean extensive desk research, horizon scanning, or interviews, or a mixture of all three, and the presence at the scenario building sessions of "external" or "remarkable" people. Scenarios that are built by only insiders tend to become introverted and pessimistic, with a focus on problems rather than opportunities.

• Scenario building is most useful when it is done in the context of an understanding of why it is being built. Is it to provide a context for decisions; or as part of building management skills? In the first case it is important that the supporting desk research on the trends is in place; in the second it may be more important to discover what is in the participants' heads.

• Scenarios should be describable in an "elevator speech"1 with a clear theme, and a set of names. They should relate to a key issue facing the organisation.

• It is often said that there should not be an odd number of scenarios because, in many cultures, it will be assumed that there is a middle or "right" scenario.

The process of scenario building is described in Appendix 1.

The Theoretical Basis Behind Scenario Thinking

Interestingly, a decade or more after the processes were first used, neurobiologists (e.g. Ingvar, 1985) discovered that the brain is actively rehearsing futures even when asleep. This means that by using scenarios to provide additional futures for exploration, the brain can be preparing for potential actions.

As Arie de Geus (1999) says

Every moment of our lives, we instinctually create action plans and programs for the future—anticipating the moment at hand, the next minutes, the emerging hours, the following days, the ongoing weeks, and the anticipated years to come—in one part of our mind.

These plans are sequentially organised, as a series of potential actions: "If this happens, I will do that." These are not predictions. They do not pretend to tell what will happen. They are time paths into an anticipated future....

Not only does the brain make those time paths in the prefrontal lobes, it stores them. We visit these futures and remember our visits. We have, in other words, a "memory of the future", continually being formed and optimised in our imaginations and revisited time and time again." This process "apparently helps us to sort through the plethora of images and sensations coming into the brain, by assigning relevance to them. We perceive something as meaningful if it fits meaningfully with a memory that we have made of an anticipated future."

The stored time paths serve as templates against which the incoming signals are measured. If the incoming information fits one of the alternative time paths, the input is understood.

We will not perceive a signal from the outside world unless it is relevant to an option for the future that we have already worked out in our imaginations. The more "memories of the future" we develop, the more open and receptive we will be to signals from the outside world".

When Not to Use Scenarios

There are times when it is not useful to have a filter for sorting through external signals. This is when one, overwhelming, tidal wave is about to engulf an industry or organisation.

A good example is given in Ringland (2006). A scenario exercise in the computer industry looked at a number of factors, but missed the total sea change in the industry which was about to be caused by the collapse in industry margins from 40% to less than 10% as the industry growth shifted to semiconductors and PCs from proprietary mainframes.

CREATIVITY AND DISCIPLINE

Scenarios bring creativity into marketing by posing the question—what if ...?—in a number of articulated and qualitatively different worlds. One scenario can be "the official future"—the future that most people expect, but the development of which may also pose the question about different futures. The Electrolux case study is a good example (see Case Study 1.2).

Discipline is also an integral part of the scenario process, as described in Appendix 1. It is an auditable process in which futures are created from a combination of external signals, some of them weak, others posing questions, other signals being trends. These are combined to give alternative time paths which then can be analysed by the subconscious as well as the conscious brain.

NEW USES OF SCENARIOS

While the popularity and application of scenarios has varied since the emergence of the technique after the Second World War (see Appendix 3 for a detailed history), in the last few years there has been a resurgence in interest for a number of reasons

• Since the mid-1990s there has been a renewed emphasis on sources of value and growth in corporations after the downsizing and retrenchment of the 1980s. See, for instance, Case Study 1.4: Pfizer's use of scenarios for organisational learning and change.

• Many senior managers now have MBAs and "know about" scenarios—perhaps, however, with a jaundiced view (O'Brien, 2004) through hurried exposure.

• The public sector in Europe has proactively developed the use of scenarios in policy discussion (e.g. European Commission, 2005).

• The non-governmental organisation (NGO) sector has realised the effectiveness of scenarios for harnessing the energies of members and the public. (See Case Study 1.3: Scenarios in Arts Marketing.)

These factors have meant that new uses of scenarios have become prominent:

• Scenario creation as a management development tool. This uses workshops—typically two days—to develop young high flyers, to create a common language in a management team (for instance after a merger), or to brainstorm ideas as a framework for research.

• Using scenarios already developed, perhaps with some implications for the organisation drawn out, as a basis for decisions on research and development, country risk, mergers and acquisitions, corporate social responsibility, portfolio management or the location and capacity of manufacturing plants.

• Using scenarios already developed to "wind tunnel" test a business plan or strategy, by asking the question: "What if this scenario happens?"

• Using scenarios already developed as a basis for action planning. An example was the use of existing Foresight 2020 scenarios (Berkhout and Hertin, 2002) to provide a framework for action planning for the Arts Marketing Association.

• As part of the communication during change management in an organisation or public consultation in local or national government, as in Arnhem (see Case Study 1.5).

CONCLUSION

Scenario planning can thus be an effective way for marketers to try to deal with the ever more complex challenges they face in a fast-moving environment. The following chapters will discuss how this can work for different aspects of marketing in more detail.

(Continues...)

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Dettagli dell?edizione

• Editore: John Wiley & Sons Inc
• Data di pubblicazione: 2006
• ISBN 10: 0470032723
• ISBN 13: 9780470032725
• Rilegatura: Copertina rigida
• Lingua: Inglese
• Numero di pagine: 227
• Redattore: Ringland Gill, Young Laurie
• Contatto del produttore: non disponibile