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I'm recently in Skagway, Alaska,
the ultimate "insider/visitor" town. (spoke in one
of the neatest venues I've ever worked . . . the lobby of an
1890's hotel converted into a Klondike Days theatre . . . great
atmosphere). During the welcome reception, I'd got to talking
with "Suzie", one of the permanent residents, about
living in Skagway.
Skagway is the 17th busiest cruise
ship destination in the world ! (it was the staging ground for
the gold rush). This season it will host 1,000,000 visitors. The
permanent population is 550 people. The only road out goes across
the Rockies into Canada.
Suzie is filling me in on some
of the pro's, con's, and quirks of life in this isolated town.
There is the casual comfort of a place where every body knows
everything. They all co-ordinate to pitch in and cover for each
other as fatigue, illness, babies, etc interrupt someone's ability
to do their part in hosting the 10,000 visitors a day during
the summer. The 911 line rings in the police cruiser, making
it convenient for family to remind an officer to bring home milk.
Last December, a resident saw
some one they didn't recognize walking near the edge of town.
So they naturally called the police to report this out-of-place
event.
Of course, they also have to
import dates for the high school prom, and if someone buys an
early pregnancy test from the drugstore, by dinnertime the whole
town knows about that too.
I'm thinking "This is like Aunt Bee's front porch . . .
the ultimate market research machine!"
On the 2 hour drive back to an
airport, I'm thinking about this neat little town. I remember
over 20 years ago consulting with a real estate franchisor, being
told by the sales people that the real secret to quickly establishing
the franchise in a new town was to get somebody to give them
all the useful information . . . after head office had sent all
the data. All the stats on numbers of agents, listings, market share,
closing ratio's, etc were handy; but what they really needed
to know was who used to be partners with who, who stole whose
best producer, and how the top local agent's divorce re-configured
3 offices. And to get that they had to be "on the street"
in that town.
On the airplane, the magazine
has a big story on the use of mega-fancy data bases driving businesses
today.
The newspaper headlines are full
of targeting errors in Kosovo . . . address changes that everyone
in town knew about, but were not in the big database. I seem
to remember that after both the fall of the Shah in Iran, and
the collapse of the Soviet Union, the conclusion was that while
the statistical data was not wrong, what was missing was good
"feet-on-the-street" intelligence. That un-quantifiable
feel, mood, intuitive sense of what's going on.
I get to thinking that success
in business is part information, and part intuition. And that
a lot of organizations are in danger of losing the latter, so
enamored are we with our (relatively) newfound ability to process
massive amounts of the former.
Being able to access and manipulate
huge amounts of data can give you a heads up on trends or obscure
shifts in the numbers that you'd never otherwise see in time.
You can make more rational and better informed decisions than
your predecessors even dreamed about.
But we still don't have enough
information to make great decisions. The human mind can process
information from sources we're not even consciously aware of,
compare it to memory databases we don't even know we have, and
make comparisons on levels computer programmers only dream of
their machines being able to do. We call the results intuition.
And you can't have it without the inputs that are only available
hands-on, on the street. You just gotta be there. There is no
substitute.
Maybe, more than ever, the magic
is in the mix.
Getting home, I flip through
the usual stack of business magazines. From Fortune through Inc.,
to Fast Company, every one of them has something on a success
story reflecting this mix of heads up data and hands on intuition.
One recalls Sam Walton's constant
touring of his stores, another features exec's at Home Depot
saying the most important thing they do is their "store
walks" . . . physically on site getting a sense of what's
happening far beyond what the spread sheets could tell them.
If the data is "what", they're out looking for "why".
Another reports a grocery store
chain in Dayton that has decided to focus solely on its repeat
customers. In addition to a very sophisticated tracking database,
it has a customer advisory board that meets every couple of months
and goes on "benchmarking trips" (paid for) to Atlanta
and Chicago supermarkets to bring back ideas.
An interview on leadership with
Bob Lutz, President of Chrysler during their early 90's turnaround,
reveals
the following: "sifting through reams and reams of market
data . . . that takes on the semblance of reality. [it often]
runs counter to common sense. Numbers are a poor surrogate for
. . . intuition, judgment
. . . and leaps of faith."
He sites the example of putting
a second sliding door on minivans, being considered by Ford and
Chrysler at the same time. Ford did extensive market research
that showed that nobody wanted one. Chrysler decided it simply
made sense and went ahead and did it. When it took off, it took
Ford over 3 years to catch up.
Canadian Business magazine reports
on Boardwalk Properties, one of the fastest growing real estate
companies in North America. (revenues from $400,000 in 1994 to
$135 million in 1999, $1 billion in assets).
They are the dominant rental housing owner in western Canada,
with an incredible knack for buying good but neglected properties
in the right neighborhoods
and then renovating them to attract
higher rents.
The article describes their heads
up use of an incredible database, "once described by Microsoft
as the most sophisticated of any real estate company in North
America", that allows them to manage this inventory. And
how they get to know a market "hands-on", in other
cities.
Once they decide on a market,
they hire some ex-cops and taxi drivers, who know the area well,
to go and make videos of all the apartments in town . . . complete
with personal commentary on the history, neighborhood, local
trends and issues.
The database of rents, property
values, taxes, and vacancy rates gives them heads up data. The
video's give them the hands on to make intuitive decisions. For
them, the mix has been magic.
This balance of information and
instinct has always been a key ingredient of success in the marketplace,
and today's avalanche of information simply makes it critical
to remind ourselves of the need for the other half of the equation.
What are you doing . . . you
personally (not the "research specialist") . . . to
make sure you are as hands on as you are heads up?
Do you go to the conventions
and conferences where your customers hang out and listen in the
hallways? (or at least get a copy of the programs to see which
are the hot issues being addressed?).
Are you out there getting your
own hands on where the real action is taking place? What mechanisms
are you putting in place to get editorial commentary from Aunt
Bee's porch to augment all the data?
You get the big bucks because
you have superior judgment
/ gut instincts/ intuition. Don't
deprive it of the fuel it needs to work effectively for you.
Warren Evans is a prominent
Canadian consultant and trainer based in Mississauga, Ontario.
A popular and dynamic speaker, he's addressed audiences across
Canada, the U.S. and in the Caribbean and Europe .
He is one of
North America's leading authorities in the field of Service Management.
Warren can be reached at (905) 858-000.
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