“Make and Sell” or “Sense and Respond”

Recently I was caught off guard by an article in “Marketing Management” by Stephan Haeckel called the “The Post-Industrial Manager.” At first glance I thought this was incredibly old news, a feeling that was re-enforced when I read the article’s featured quote from Peter Drucker from 1992 where he said that “No new theories on which a big business can be built have emerged.  But the old ones are no longer dependable.”  I doubled checked the date on the publication I was reading and while I thought I had accidently grabbed something out of the ‘90s archives, it turns out it was from 2010 and it was shockingly right on the money.

The article focused on the state of many large marketing departments in multi-billion dollar companies, or even Fortune 100 companies; explaining that they have not yet emerged from the post-industrial age.  The article contends that it is the executive management style of these large companies that is preventing marketing progress.  Haeckel asks companies to think about their style with some clear categorization.  He says that most of us fall into one of two buckets, and asks:  “Are you a “Make and Sell” company, or are you a “Sense and Respond” company?  Amazingly, in the age of social media, individual content contribution and customer engagement, there are still many companies executing marketing strategies in the “Make and Sell” mindset.

Then there are the companies that BELIEVE they are sensing and responding but they are only “sensing and responding” to their own internal drum.  These companies are even more destructive with marketing strategy because they become more of a sheep in wolves clothing—only talking amongst themselves about community, understanding the customer, thought leadership and industry awareness, but they never really empowering or allowing their marketing teams the luxury of engaging with their audiences because they have them in the constant loop of engineer-make-deliver product launch syndrome.

So what is a company that is stuck in the Make and Sell mentality to do?  While it is not easy to evolve to the more responsive and agile Sense and Respond strategy, the effort is worth the investment.  Sense and Respond gives companies a critical timing advantage to address consumer needs early in the adoption cycle where business is most profitable.  Communication with the community often reduces development and investment risks and allows for faster and more targeted iterations of products.  But the change requires developing the ability to focus on individuals which often requires different thinking supported by different marketing systems, and different measurements.  Xerox understood this when they required a “reconceptualization of the purpose, structure and metrics of “customer sat.  Responding rapidly to the unpredictable requests of tens of thousands of individual end users dictated against a process approach…..Now, with the deployment of advanced analytics, Xerox is able to learn continuously how to improve its offerings.  Because they know earlier than their clients what is happening at the end-user level.”

The silver lining in this age-old marketing challenge is that if Xerox – a venerable battleship in the market – can quickly turn its resources, infrastructure and thinking around to successfully engage in a “Sense and Respond” marketing approach then nearly anyone else can do it too.

Written by:  Michelle Palmer, Partner, MediaSolve