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Title
―What NEURO-MARKETING has to say about GLOBALIZATION STRATEGIES
in
EMERGING MARKETS:
A tripartite alliance between corporate culture, international relations and globalization forces.‖
Author name and affiliation
Ianna Contardo
+9714 4291234 - Ext.: 230
Ianna.contardo@spjain.org
Associate Dean, GMBA &
Head of Neuro-Marketing Centre
SP Jain Center of Management – Dubai
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Keywords: Strategic decision-making, emerging markets, mental maps, neuro-marketing, universal lessons.
Harrison Ford on American patriotism:
―Nature does not need people. People need nature‖.
Introduction and Common Issues
By definition, emerging markets are nations with social and business activities in the process of rapid growth, industrialization and significant changes in the way consumption levels need to be addressed with respect to the more developed markets. As with national culture (Hofstede, 2003), recent research indicates that corporate culture plays a very important role in radical innovation (Tellis, Prabhu & Chandy, 2009). In India, the quarterly estimate of GDP for 2010-11 released at the end of August 2010 places the growth in real GDP at 8.8% in the first quarter of the current fiscal year, with agriculture recording a growth rate of 2.8%; industry 10.3% and services by 9.7%. On the demand side, while real growth in GDP at market prices (at constant 2004-05 prices) has grown at 10.0% as against a growth of 5.2% in Q1 of 2009-10, the growth in private consumption demand at 3.8% and in investment demand at 7.6% is showing signs of regaining earlier momentum. Looking ahead, India can be said to have had a good monsoon so far and the business sentiments are positive and broad based, which should allow the growth to retain its inclusive and cross industries momentum (Finance Prime Minister Pranab Mukherjee, Emerging Markets – October 19, 2010).
Despite these national differences, fundamentally similar questions underline the process of adaptation that international organizations need to address while pursuing their market strategies. These can be grouped under the family of decisions which are pervasive and common to the health of the company. Ill-advised decisions may affect the overall performance of the organisation while also depriving individuals to acquire personal competencies. The recurrence of the issues should not come as a surprise. The same questions return to frame strategy. For example, ―Why do firms differ? How do firms behave? What affects their long-term success? And what will make their global presence more relevant to their local customers?‖ The landscape of wrong strategic business decisions is bleak but the real value lies in the recovery.
The case of Ford Motor is no exception. In the following section we are going to look at the automobile industry. We will address the difficulties experienced during the financial crisis and investigate the case of Ford Motors in its local market as well as in its latest entry into the emerging market of India through the lens of the framework developed in this article. General Motors (GM) and Chrysler - two main players in the auto industry – faced serious hurdles. In 2009 R Wagoner, chairman and CEO of GM, was deposed by the Treasury Department‘s auto task force. Chrysler then declared bankruptcy and was in negotiation with the Italian auto-maker FIAT.
Again, it is in times of crisis that most interesting management models are provided by the business survivors. Amid the above ruins stands Ford Motors (FM), un-intervened by the US Government. Now led by A. Mulally, former CEO at Boeing and an outsider to the auto industry, back in 2009 FM was on a crusade simply to rescue the brand and its vehicles. Is FM an exception to the standard industry‘s poor results, statistically
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speaking an organization distant from the rest of the data observed, or is Mulally offering a new successful business model? To answer this question and to address the advantages of what Neuro-Marketing has to say about emerging markets, let us first review the process of strategic decision-making.
Strategic decision-making (SDM) has become a critical area of concern in many organizations. Yet the effectiveness of this process is often affected by several common problems. Most decision making challenges revolve around issues of over-optimism, loss aversion, confirmation bias, internal focus and mismanagement of information. Moreover, little time is dedicated to reviewing the process. This in turn prevents correcting what are severe causes of mismanagement and financial losses. This leads to the cornerstone question: how can leaders better deal with SDM?
Via the Bias
Companies can only survive if they make the right decisions. Although this may sound very obvious, the process that underlines the outcome is still poorly understood. Usually, they do so by processing information through the strategic vision of their leaders. This rational and mechanistic view of decision making, however, is supported by the school of thought that confirms the mind as a key element of strategy execution. Within the different parts of the brain, thoughts emerge, patterns are analyzed, and decisions are eventually made. Given its subjective nature, however, the process becomes compromised by what psychologists denominate ―biases‖. Cognitive biases are common in human thought as the systemic errors of interpretation.
Following a famous phrase by Polish-American scientist and philosopher Alfred Korzybski: ―The map is not the territory‖. Like for a road map, what we see on it or in our brains is only a representation of what constitutes something else that remains susceptible to personal interpretation. This remark becomes fundamental to understanding that our thoughts are the result of a transformation which necessarily may include mismatches. Similarly the SDM map leaders follow does not exactly correspond to reality. Given the novel insights from the neurosciences, we can now use a fresh perspective to adjust the map and reinforce our ability to strategize. What Neuro-Marketing offers is a decisive way to improve the processes by which we reach decisions, by filtering biases via a more accurate understanding of the markets and their stakeholders.
The fundamental argument underpinning NM is that good decision-makers are usually not fully conscious of the issues at stake, such as biases, nor can they be. Under the conventional paradigm, consciousness is compared to ―a theatre‖. In the arena of the mind, leaders as subjects seek to make sense of the plot being designed in their surroundings. The initial comparison may surprise us yet it is ingrained in the way we base economic theories whose pillars rely on rationality. The idea of consciousness as a theatre is criticized by the philosopher Dennett, who claims that such a representation is just an illusion we embroil ourselves with since Descartes‘ inception of mind body duality. Cartesian materialism produced a school of thought that still influences greatly the paradigm on decision making. It states: ―That there is a crucial finish line or boundary somewhere in the brain, marking a place where the order of arrival equals
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the order of „presentation‟ in experience because what happens there is what you are conscious of‖ (Dennett, 1992).
This misleading metaphor, affects the way we represent SDM processes. It makes believe we are in full control of decisions, hence causes over optimism, consequently creates fear of loss, provokes battles between different actors and finally distorts the way each of these actors actually relates to each other. On the other hand, NM adopts the novel and useful paradigm of ‗multiple drafts‘ again suggested by Dennett. Decisions do not have a moment and a space but belong to a backstage that is always at work – the non-conscious. When the spotlights of non-conscious mental constructs begin to glow, thoughts emerge into consciousness. There is no one place and there is no single observer or unity of public because consciousness is much more dispersed.
Numerous neuro-social scientists (Rock, 2009; Rock & Schwartz 2006; Eisenberger, Lieberman & Williams 2003; Ariely, 2008) are claiming it is time for a different paradigm to explain decision-making and help executives improve on the process. Again, the philosopher complains that ―the Cartesian Theatre keeps coming back to haunt us … even after its ghostly dualism has been denounced and exorcized‖ (Dennett, 1992). Moreover, the economist Gifford reminds us: ―Recent discoveries by neuro and cognitive scientists are providing an understanding of the biological basis of human social cognition‖ (Gifford, 2002). Our awareness of biological commonalities in the human species provides more insight around the way strategic decisions occur.
Key advantages of the method
Dating back to attribution theory (Mizerski, Golden & Kernan, 1979) all the way to evolutionary psychology, and strategic decision-making in the era of product or service development (Jayasimha, Nargundkar, Murugaiah, 2007) the search for order and meaning in the environment is an attempt to explain causes of observed phenomena. Debates about whether research in business and social sciences should use a mix between quantitative and qualitative methods are numerous. A core issue, not related to choice of methodologies but rather addressing the underlying principles of research itself, acknowledge the need of paradigms (Sobh and Perry, 2006) in which strategy, marketing or product/service innovation for emerging markets will be defined.
The better we use the knowledge derived from non-conscious constructs, the better we can communicate and incorporate mental models of groups and teams into the decision making process. This builds a way to reduce individual fallibility. NM techniques go further than just looking at language as a means to tap into non-conscious constructs. They help unravel these flaws before going into the process, or at least to recognise our own worldview so as to make better decisions, either as individuals or in groups.
The following sections describe the conditions of individual perception versus the benefits of social cognition. This offers us a brief yet relevant framework to understand how human minds could operate to survive the world of forward modelling, namely how to devise successful strategies. By applying NM techniques to the decision-making processes, aware strategists can turn their organizations into more risk-protected entities, which is what the case of FM illustrates while entering emerging markets like India.
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What does the concept model? A succession of perception, choice and transformation
Strategic leaders‘ perceptions are not much different from those of any other mind. Neuroscientists agree on the human ability to identify different scenarios depending on the activation of stored information.
Choice is an outcome of culture, evolution and learning - part of a symbolic system incorporated in the forward models used to devise strategies. Decision-making is the result of the combination of these elements plus individual personal attributes. Since these factors rarely surface into consciousness together, decision-making requires special attention to correct such natural biases.
Transformational grammar is a term coined by N. Chomsky that proposes the idea that each sentence in a language has two levels of representation — a deep structure and a surface structure. The deep structure represents the core semantic relations of a sentence, and is mapped on to the surface structure (which follows the phonological form of the sentence very closely) via transformations. This combined with new frameworks to mediate the thinking process, represent a NM approach to address the ―blind spots‖ of the mind, in other words the processes below consciousness. Organizations faced with the uncertainty of the strategic decision-making can then find viable and simple solutions to improving the mental power of forward modelling and addressing market demands.
What is Social Cognition?
With greater awareness enhanced by the recent insights into the mind, we begin to realise that the information we perceive as individuals is not adequate to determine reality. In fact, missing data is supplied by our own brains. Accordingly, perception is a mere product or end result of our own memory. SDM is no exception to this fact of individual fallibility. Social cognition contains the solution to the challenge of individuality. It relies on shared learning and discovery of meaning through language and cultural habits – namely by interface with others.
A major component of human evolution is social, including institutions, the recognition of symbolic structures, sense-making, and collaborative - even competitive - activities, such as business interaction. Recent research on the brain shows that the ability to intentionally address the social brain will be a distinguishing leadership capability in the years to come.
The Starting Point: A convincing case
Mulally, the sixty-four year old veteran executive explains ―I am here to save an American and global icon‖. At FM he says he has to have found a home, a place to recover balance and to take pleasure while doing it. ―I have been through a lot of cycles. I am not up and down. I am rock solid. I am steady. And everybody knows why I am here. It is not a career move. I am not trying to get ahead. I am not looking for more awards.”(Fortune Magazine,
Precisely because Mulally had no experience in mass marketing or dealer relations before joining FM in September 2006, he delegated product decisions to professionals
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in these fields. This is unsurprising from a man with long-standing business experience. Yet he is distinguished from other strategic thinkers by his cognitive and behavioural expertise in building revolutionary collective mental maps to lead him and other key people through the complex scenario of decision making. Hence the way he significantly used NM tactics to implement his transformational vision. Mulally‘s enlightened approach is summarized by the following three ideas which neatly encompass solutions to improve SDM:
1. living in the moment;
2. enhancing social cognition; and
3. finding a new language based on images.
Living in the moment:
Although Mulally is conscious of the notion of a time line, he is committed to the now of a situation. According to previous comments, time is experienced as having occurred either already (past) or not yet (future). Drawing on new understanding of the functioning of the brain, the NM techniques encourage the philosophy that time is a constant now. Mulally in fact applies what NM seeks to show as a successful tool to address the problems caused by holding on to old patterns or thinking models.
o To be efficient, the brain must produce future action swiftly. We now understand that there is no absolute moment in time in which consciousness takes place. The following familiar illusion needs to be discarded: evolving as an unconscious intention, an act-initiation develops deep in the brain, then slowly advances into consciousness and finally reveals a vision.
o Using the NM approach, the temporal properties of the represented (actual) become important, rather than the temporal properties of the perceived (expected). So the very act of probing to discover when decisions take place - and how they are formed – will precipitate narratives that in turn influence the revisionary systems of representation used by the brain.
o Living in the moment emphasises the significance of the constant now. This offers a less intuitive, more systematic approach to SDM, avoiding the tendency for the formation of thought sequences.
o Mulally supports these understandings of the process and, as a leader, promotes the idea that time is a constant rather than a resource. This notion of the constant reduces the stress and the uncertainty involved in SDM, since the key elements of the decision revolve around the properties of the represented and not those that belong to an unknown future.
Enhancing social cognition:
“When I arrived, there were six or seven people reporting to Bill Ford, and the IT person wasn‟t there, the human resources wasn‟t there‖, says Mulally. ―So I moved up and included every functional discipline on my team because everybody in this place had to be involved and to know everything‖. Mullaly believes that teams of decision-makers should be inclusive: all the individuals on the team should be able to access – and process – the necessary information. A well taken instance of neurons that fire together, wire together. Because the starting point of SDM is never fixed, Mulally understands that the actors involved in SDM play different roles at different times. Going back to the analogy of the theatre, he stresses the fact that
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such theatre is about rational agency but also intuition and shared mental maps that need to be flexible, connected and in permanent communication. The model so closely resembles the interconnectivity of the parts of the brain, that it seems as though Mulally has been inspired by its very structure.
o Neurological nets create patterns. Any human brain relies on them for processing information. Yet these nets are not inert - they reflexively work together according to the plasticity required by the tasks at hand.
o When Dennett speaks about the evolution of the brain‘s functioning system, he says: ―The candidates for selection (brains) are various brain structures that control or influence behaviours... Amazingly, this capability, itself a product of genetic evolution by natural selection, not only gives the organisms who have it an edge over their hard-wired cousins who cannot redesign themselves, but also reflects back on the process of genetic evolution and speeds it up‖. This is commonly known as the Baldwin Effect1.
o At FM, Mulally fosters interaction and learning by examining the actions of others. Forward modelling then becomes much more reliable. The action planning process simulates this aspect of brain functioning: the mirror neurons involved in thinking seem to couple with the reward expectancy values provided by the emotional human systems that estimate costs and benefits of alternatives. Mulally make use of this in a more NM way, since he enhances and speeds up the process by adopting the inclusive team approach. This model relates to the openness of social systems as it rewards value-innovative ideas.
Speaking a new language of images:
In essence, all brains are machines of anticipation. From these investigations, we realise that below the surface of what we think we see, are aspects of reality that we reconstruct and elaborate on whenever our minds need to perceive a required representation.
o “How can I tell what I think until I see what I say?” (E.M. Forster, 1960). In other words, auto-stimulation is needed, such as speaking aloud. The acts of talking and hearing build a virtual wire between the broadcast of information and the relevant subsystems involved in the creation of meaningful forward models.
o ―We speak, not only to tell others what we think, but also to tell ourselves what we think‖ (J. Hughlings Jackon, 1915). There are difficulties in connecting new neural nets, unless the brain picks up on errors and corrects them. The mirroring effect of others is required to pick up natural biases that cause the mental ―blind spots‖ to occur with communication, again not being fully aware of the meaning of the surface and deep structures of language.
o However, talking aloud only represents one possibility. The one mostly used by the human mind is thinking in pictures. The language of images is probably the most significant.
1 The Baldwin effect, also known as Baldwinian evolution or ontogenic evolution, is an early evolutionary theory put forward in 1896 in a paper "A New Factor in Evolution" by American psychologist James Mark Baldwin which proposes a mechanism for specific selection for general learning ability.
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o Mulally is able to communicate his vision for FM with visuals. During meetings, distractions are strongly discouraged: communicative devices such as Blackberries are banned, and if someone needs to be interrupted, the meeting will stop. No big deal, you would say, it is a question of respect. Yes, but respect of what? The short answer is respect of the mind and its intricacies. When we take into account that no other animal brain can represent the smell of a fine old red burgundy or Vienna or the Pi number, respect becomes the attitude of revering the learning adjustments that a human brain implements every time it is confronted with representation.
o To monitor any decisions to do with change, Mulally has instituted another two visually-based working methods. Firstly, reports have been colour coded: green for good, yellow for caution and red for serious problems. If not all are green, the plan will be modified. Secondly, Mulally has set up two adjacent rooms, the walls of which are lined with 280 performance charts. These are ordered by areas of responsibility. Executives-in-charge are responsible for their sections‘ charts and use them as a construction platform to guide their decisions.
o These ideas came to the CEO when he first arrived and asked to see the product line-up. He was immediately stunned to find no Taurus. The model has been renamed the Five Hundred. How could there be FM without a Taurus? Doesn‘t brand building cost billions?
o Try the following thought experiment: can the mental picture of the Five Hundred replace that of the Taurus? Picture a purple cow and then a yellow cow – ask yourself, what is the difference? The answer would be obvious: the first imaged cow is of a different colour from the second. These events that occur in your mind are tightly associated with your particular imaginings, and with associated values, principles and attributes. So since the Five Hundred and the Taurus are both cars, what are the differences between the Five Hundred and the Taurus? Well, that is what brands are about and what strategic thinking requires. The Taurus is an icon for FM while the Five Hundred in comparison is more of a secular, well-designed vehicle, with a new platform indeed but still not yet worshipped by the public.
o Marketing, as well as SDM, has to find competitive and differentiating factors for companies to thrive. Often, though, when you look into the mind of a decision strategist, you discover that there is nobody home.
An update on emerging markets and how FM is addressing the challenges offered in India more specifically, can be linked back to the previous sections in which NM has identified key success factors for stabilizing the organization even in times of economic turmoil. Back in 2006, FM said it would increase its production and presence in Asian and African markets. Ford planned thereafter to ―rapidly expand its presence in the fast growing market‖ of India by launching eight new vehicles in the Asian country by the second half of decade, in order to meet the surging demand overseas. The company‘s stock rose more than 1% after announcing more than 30,000 Ford Figo subcompact vehicles were sold in only 25 weeks in that market. With success in India, the automaker plans to export the subcompact, specially designed for overseas market where small vehicles are selling, to 50 emerging markets including Mexico, North
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Africa and the Middle East, starting in 2011. Export to the South African market has already begun in May.
The company eyes on these new markets as it predicts that 70% of the global growth will be from Asia and Africa over the next decade. ―It‘s very important for carmakers to be in emerging markets, because that‘s where the growth is,‖ said Kirk Ludtke, analyst for CRT Capital Group. ―Over time, as the economy develops and as average incomes rises, the consumers in those areas can afford increasingly expensive vehicles, so carmakers can benefit from a favorable shift and mix.‖ The Figo is manufactured in India and has been successful enough to export, said Ford. ―The transaction prices might be lower in India, but the vehicle itself is probably equipped in such a way that they can deliver it at a profit,‖ said Ludtke (Seer Press, August 2010). The point is that thanks to the solid pillars embedded in the strategic vision of the ―Way Forward‖ and the superb execution that has followed Mullaly‘s understanding of what managing with brains in mind means, FM has crossed international boundaries with very limited damage.
This reveals three interesting and interrelated phenomena: 1) Plasticity of thought processes depend on leadership styles; 2) Viable models of strategic decision-making are applicable to very heterogeneous environments and contexts; 3) Success of marketing strategies is not structure dependent but rather market driven from the inside out, from one mind to one kind, and from one product to one market. This is why in the end, the task of good decision-makers can be simply stated as that of evaluating the balance between mental ―primitive jargon‖ with automation of creative processes adaptive to the new challenges.
Tapping into the NM components of decision-making
Because NM addresses the fundamentals of actuarial intelligence it can be explained through the definition provided by Boehm (1999). People are the only living species capable of computing long-term costs and benefits of complex social systems and to maintain the intricate forward-looking accounts necessary for executing the appropriate actions that keep the system working. Strategically, this is an issue that has to do with co-operation, competition and co-opetition. Accordingly, NM is a technique that triangulates inter-subjectively amongst teams and mediates at the individual level between the non-conscious and the conscious components of the mind.
o First case scenario: Social triangulation Let us consider the very basic economic unit of social interaction: the transaction. At its minimum, a transaction not only involves two agents but most importantly perhaps involves the object or objects of the transaction, hence a triad. These objects are the physical and / or symbolic artefact of the intentional mental states guiding the agents involved in the transaction. Interestingly, these objects then constitute the representation of a common cognitive content maintained not just at the level of awareness but also at the non-conscious level of the mental constructs enacted in the transaction.
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o Individual mediation Similarly, following on the approach of triangulation, mediation considers the hurdles involved in tapping into the individual mind without disrupting the flow of consciousness. Humans use imitation and learning tools to improve their personal skills. As Nietzche reminds us: ―Consciousness generally has only been developed under the pressure of the necessity for communication‖. There is a larger idea here, and it involves the constant tension in the mind between paying attention to the outside world versus our own internal thoughts. Mind wandering is a natural state. In recent years, scientists have begun to see the act of daydreaming very differently. They have demonstrated that daydreaming is a fundamental feature of the human mind - so fundamental, in fact, that it is often referred to as our ―default‖ mode of thought. Many scientists argue that daydreaming is a crucial tool for creativity, a thought process that allows the brain to make new associations and connections. Instead of focusing on our immediate surroundings - such as the message of a church sermon - the daydreaming mind is free to engage in abstract thought and imaginative ramblings. As a result, we are able to imagine things that do not actually exist, like sticky yellow bookmarks.
Bringing it all together to enjoy our experiences
In the first quarter of 2009, Genesis Management Consulting (GMS) collaborated on a survey to obtain greater understanding of challenges and best practices associated with strategic decision-making. The research covered organisations from most industry sectors and from all around the globe. The areas in which organisations believed they could improve were: Pre-Decision, Decision and Post-Decision.
Not surprisingly the main aspects affecting decision-making were identified in people and processes. Members of the team were not sufficiently prepared, inter-company politics impacted negatively on the decision and people lost sight of the priorities when they sought to implement the strategies chosen. In terms of flaws in the process, too much attention to the financial aspects and the lack of challenge of deep assumptions were highlighted as important components to improve on. Time was also mentioned and affected significantly the review of the whole process while complaints showed that despite the financial indicators, scenarios were not sufficiently accurate to include relevant risks affecting the survival of the companies.
Our framework states the following five points which although not laid out in great detail as they go beyond the scope of this paper, offer initial solutions that reinforce the ideas discussed throughout the text.
In line with Mulally‘s strategic model of emerging market penetration, we suggest three points complemented with other two from our analysis of the data collected:
1. Living in the ―now‖: part of what contributes to a successful outcome in strategic decision-making is creating momentum. Institutionalizing the process as an ongoing story about the topic of Deciding has no fixed beginning or end but simply stands in the present moment, puts in place a formal process that is sufficiently stable to handle continuities in patterns while accommodating the required evolutionary changes, particularly in emerging markets where growth is
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constantly reinventing value chains, business models, product categories and marketing campaigns.
2. Leadership: everybody understands the first point about the ongoing narrative. Deciding permeates corporate and business cultures and allows people to define their roles clearly according to the framework imposed by the issues at stake. Everybody also acknowledges that roles are similar to those of the different parts of the brain which collaborate to bring awareness without relying on the single Central Executive. As in the mind, the theatre of organisational decision-making becomes an open system and the parts of it contribute to the greatness of the performance since they are interconnected. This in turn feeds the entire organization and allows individuals to connect with social cognition at all levels. As Mulally puts it: ―Three things we need: ―To communicate, to communicate about the fact we are communicating and finally to communicate we have communicated...‖
3. Check-lists: the plan matters. It indicates direction, variables and goals. The plan anticipates and is alive, uses events as platforms to reflect upon emerging strategies, keeps an eye on the competitive map and signals red flag conditions. The check-list, however, includes the less formal or more intuitive mental components. It is therefore a tool that incorporates images of the organisation and its position in the markets: both the internal spaces of social interaction as well as the external negotiations with stakeholders.
4. Mediation: people are trained to surface their deep mental constructs and to develop a language that is thorough in its speech acts. Individuals are converted in their own masters or teachers as they learn to identify the Deletion, Distortion and Generalization phenomena that jeopardize the flow of their expressions and do otherwise prevent the identification of balanced set of choices.
5. Techniques that work: finally, quality of the process leading to good strategic decisions is assessed on the basis of financial performance, on the non-intrusiveness of the learning process and the insights acquired into the inter-subjective nature of human interaction. Balance prevails.
Concluding remarks
Although uncertainty is irreducible in all endeavours of human life, risk can be controlled and managed. Not all decisions are the same nor do they suffer from the same amount of risk, but all situations can benefit from greater awareness of what is desirable and what is not to achieve good decisions from the corporate culture. Simple approaches like the ones described in this paper have a strong and long-lasting impact on people because the most important objective they reach is to allow individuals to better understand some of the mysteries of the mind. If wisdom is the gift of a few, one of the key roles of CEOs and experienced chairmen consists in leading others to learn along the way and contribute to the reduction of unnecessary risks while changing the decision making process into a more responsible and efficient activity.
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Short Biography
Ianna Contardo: Before joining SP Jain in July 2010 as Associate Dean of the Global MBA & Head of the Neuro-Marketing Center of Excellence in Dubai, she was a Professor in Business Strategy at the IE Business School - Madrid since 2000. Ianna registered the brand Neuro-Strategy® (no. 2.842.430), a pedagogical and consulting technique which addresses the challenges of strategic decision-making and organizational training. She uses it to lead and guide the SP Jain Center of Neuro-Marketing in the areas of business research that relate to corporate projects – Emami, Marico, DHL - and executive education. In addition to her academic schedule, Dr. Contardo is a Senior Researcher in Strategic Marketing for Olson Zaltman Associates, a company co-founded by Gerald Zaltman of the Harvard Business School and Gerald Olson of Penn State University. The research and consulting firm specializes in techniques which target consumers‘ implicit thoughts, feelings and knowledge base. Included within their diverse clients are Pfizer, Microsoft, Cadbury Schweppes and The Coca-Cola Company. Her publications address topics such as Neo-Institutionalism, Competitive wars, Language games, Management-Buy-Outs, Irony and Epistemology. Ianna holds a PhD from Warwick Business School in ―Strategic Management and Marketing‖.
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References
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2. Dennett, Daniel, ―Consciousness Explained‖, Back Bay Books, 1992.
3. Eisenberger Naomi, Lieberman Matthew & Williams K.D., ―Does Rejection Hurt? An fMRI Study of Social Exclusion‖, Science, vol. 302, no. 5643, October 2003, 290-292.
4. Gifford, Adam, ―The evolution of the social contract‖, Constitutional Political Economy, 13, 361-379, 2002.
5. Hofsteede, Geert, ―Culture‘s Consequences: Comparing Values, behaviors, Institutions, and Organizations Across Nations‖, Newbury Park, CA: Sage Publications, 2003.
6. Jayamsimha, K.R., Nargundkar, Rajendra & Murugaiah, V., ―New Service Development (NSD): Role of customer contact executives‖, The Journal of Business Perspective, Vol. 11, No. 2, april-June 2007.
7. Lehrer, Jonah, ―Daydream achiever‖, The Boston Globe, 2008.
8. Rock, David, ―Managing with the Brain in Mind‖, Strategy+Business, Issue 56, Autumn 2009.
9. Rock, David & Schwartz, Jeffrey, ―The Neuroscience of Leadership‖, Strategy+Business, Summer 2006.
10. Sobh, Rana and Perry, Chad, ―Research design and data analysis in realism research‖, European Journal of Marketing, VOl. 40, No. 11/12, 2006.
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Title
―What NEURO-MARKETING has to say about GLOBALIZATION STRATEGIES
in
EMERGING MARKETS:
A tripartite alliance between corporate culture, international relations and globalization forces.‖
Author name and affiliation
Ianna Contardo
+9714 4291234 - Ext.: 230
Ianna.contardo@spjain.org
Associate Dean, GMBA &
Head of Neuro-Marketing Centre
SP Jain Center of Management – Dubai
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Keywords: Strategic decision-making, emerging markets, mental maps, neuro-marketing, universal lessons.
Harrison Ford on American patriotism:
―Nature does not need people. People need nature‖.
Introduction and Common Issues
By definition, emerging markets are nations with social and business activities in the process of rapid growth, industrialization and significant changes in the way consumption levels need to be addressed with respect to the more developed markets. As with national culture (Hofstede, 2003), recent research indicates that corporate culture plays a very important role in radical innovation (Tellis, Prabhu & Chandy, 2009). In India, the quarterly estimate of GDP for 2010-11 released at the end of August 2010 places the growth in real GDP at 8.8% in the first quarter of the current fiscal year, with agriculture recording a growth rate of 2.8%; industry 10.3% and services by 9.7%. On the demand side, while real growth in GDP at market prices (at constant 2004-05 prices) has grown at 10.0% as against a growth of 5.2% in Q1 of 2009-10, the growth in private consumption demand at 3.8% and in investment demand at 7.6% is showing signs of regaining earlier momentum. Looking ahead, India can be said to have had a good monsoon so far and the business sentiments are positive and broad based, which should allow the growth to retain its inclusive and cross industries momentum (Finance Prime Minister Pranab Mukherjee, Emerging Markets – October 19, 2010).
Despite these national differences, fundamentally similar questions underline the process of adaptation that international organizations need to address while pursuing their market strategies. These can be grouped under the family of decisions which are pervasive and common to the health of the company. Ill-advised decisions may affect the overall performance of the organisation while also depriving individuals to acquire personal competencies. The recurrence of the issues should not come as a surprise. The same questions return to frame strategy. For example, ―Why do firms differ? How do firms behave? What affects their long-term success? And what will make their global presence more relevant to their local customers?‖ The landscape of wrong strategic business decisions is bleak but the real value lies in the recovery.
The case of Ford Motor is no exception. In the following section we are going to look at the automobile industry. We will address the difficulties experienced during the financial crisis and investigate the case of Ford Motors in its local market as well as in its latest entry into the emerging market of India through the lens of the framework developed in this article. General Motors (GM) and Chrysler - two main players in the auto industry – faced serious hurdles. In 2009 R Wagoner, chairman and CEO of GM, was deposed by the Treasury Department‘s auto task force. Chrysler then declared bankruptcy and was in negotiation with the Italian auto-maker FIAT.
Again, it is in times of crisis that most interesting management models are provided by the business survivors. Amid the above ruins stands Ford Motors (FM), un-intervened by the US Government. Now led by A. Mulally, former CEO at Boeing and an outsider to the auto industry, back in 2009 FM was on a crusade simply to rescue the brand and its vehicles. Is FM an exception to the standard industry‘s poor results, statistically
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speaking an organization distant from the rest of the data observed, or is Mulally offering a new successful business model? To answer this question and to address the advantages of what Neuro-Marketing has to say about emerging markets, let us first review the process of strategic decision-making.
Strategic decision-making (SDM) has become a critical area of concern in many organizations. Yet the effectiveness of this process is often affected by several common problems. Most decision making challenges revolve around issues of over-optimism, loss aversion, confirmation bias, internal focus and mismanagement of information. Moreover, little time is dedicated to reviewing the process. This in turn prevents correcting what are severe causes of mismanagement and financial losses. This leads to the cornerstone question: how can leaders better deal with SDM?
Via the Bias
Companies can only survive if they make the right decisions. Although this may sound very obvious, the process that underlines the outcome is still poorly understood. Usually, they do so by processing information through the strategic vision of their leaders. This rational and mechanistic view of decision making, however, is supported by the school of thought that confirms the mind as a key element of strategy execution. Within the different parts of the brain, thoughts emerge, patterns are analyzed, and decisions are eventually made. Given its subjective nature, however, the process becomes compromised by what psychologists denominate ―biases‖. Cognitive biases are common in human thought as the systemic errors of interpretation.
Following a famous phrase by Polish-American scientist and philosopher Alfred Korzybski: ―The map is not the territory‖. Like for a road map, what we see on it or in our brains is only a representation of what constitutes something else that remains susceptible to personal interpretation. This remark becomes fundamental to understanding that our thoughts are the result of a transformation which necessarily may include mismatches. Similarly the SDM map leaders follow does not exactly correspond to reality. Given the novel insights from the neurosciences, we can now use a fresh perspective to adjust the map and reinforce our ability to strategize. What Neuro-Marketing offers is a decisive way to improve the processes by which we reach decisions, by filtering biases via a more accurate understanding of the markets and their stakeholders.
The fundamental argument underpinning NM is that good decision-makers are usually not fully conscious of the issues at stake, such as biases, nor can they be. Under the conventional paradigm, consciousness is compared to ―a theatre‖. In the arena of the mind, leaders as subjects seek to make sense of the plot being designed in their surroundings. The initial comparison may surprise us yet it is ingrained in the way we base economic theories whose pillars rely on rationality. The idea of consciousness as a theatre is criticized by the philosopher Dennett, who claims that such a representation is just an illusion we embroil ourselves with since Descartes‘ inception of mind body duality. Cartesian materialism produced a school of thought that still influences greatly the paradigm on decision making. It states: ―That there is a crucial finish line or boundary somewhere in the brain, marking a place where the order of arrival equals
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the order of „presentation‟ in experience because what happens there is what you are conscious of‖ (Dennett, 1992).
This misleading metaphor, affects the way we represent SDM processes. It makes believe we are in full control of decisions, hence causes over optimism, consequently creates fear of loss, provokes battles between different actors and finally distorts the way each of these actors actually relates to each other. On the other hand, NM adopts the novel and useful paradigm of ‗multiple drafts‘ again suggested by Dennett. Decisions do not have a moment and a space but belong to a backstage that is always at work – the non-conscious. When the spotlights of non-conscious mental constructs begin to glow, thoughts emerge into consciousness. There is no one place and there is no single observer or unity of public because consciousness is much more dispersed.
Numerous neuro-social scientists (Rock, 2009; Rock & Schwartz 2006; Eisenberger, Lieberman & Williams 2003; Ariely, 2008) are claiming it is time for a different paradigm to explain decision-making and help executives improve on the process. Again, the philosopher complains that ―the Cartesian Theatre keeps coming back to haunt us … even after its ghostly dualism has been denounced and exorcized‖ (Dennett, 1992). Moreover, the economist Gifford reminds us: ―Recent discoveries by neuro and cognitive scientists are providing an understanding of the biological basis of human social cognition‖ (Gifford, 2002). Our awareness of biological commonalities in the human species provides more insight around the way strategic decisions occur.
Key advantages of the method
Dating back to attribution theory (Mizerski, Golden & Kernan, 1979) all the way to evolutionary psychology, and strategic decision-making in the era of product or service development (Jayasimha, Nargundkar, Murugaiah, 2007) the search for order and meaning in the environment is an attempt to explain causes of observed phenomena. Debates about whether research in business and social sciences should use a mix between quantitative and qualitative methods are numerous. A core issue, not related to choice of methodologies but rather addressing the underlying principles of research itself, acknowledge the need of paradigms (Sobh and Perry, 2006) in which strategy, marketing or product/service innovation for emerging markets will be defined.
The better we use the knowledge derived from non-conscious constructs, the better we can communicate and incorporate mental models of groups and teams into the decision making process. This builds a way to reduce individual fallibility. NM techniques go further than just looking at language as a means to tap into non-conscious constructs. They help unravel these flaws before going into the process, or at least to recognise our own worldview so as to make better decisions, either as individuals or in groups.
The following sections describe the conditions of individual perception versus the benefits of social cognition. This offers us a brief yet relevant framework to understand how human minds could operate to survive the world of forward modelling, namely how to devise successful strategies. By applying NM techniques to the decision-making processes, aware strategists can turn their organizations into more risk-protected entities, which is what the case of FM illustrates while entering emerging markets like India.
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What does the concept model? A succession of perception, choice and transformation
Strategic leaders‘ perceptions are not much different from those of any other mind. Neuroscientists agree on the human ability to identify different scenarios depending on the activation of stored information.
Choice is an outcome of culture, evolution and learning - part of a symbolic system incorporated in the forward models used to devise strategies. Decision-making is the result of the combination of these elements plus individual personal attributes. Since these factors rarely surface into consciousness together, decision-making requires special attention to correct such natural biases.
Transformational grammar is a term coined by N. Chomsky that proposes the idea that each sentence in a language has two levels of representation — a deep structure and a surface structure. The deep structure represents the core semantic relations of a sentence, and is mapped on to the surface structure (which follows the phonological form of the sentence very closely) via transformations. This combined with new frameworks to mediate the thinking process, represent a NM approach to address the ―blind spots‖ of the mind, in other words the processes below consciousness. Organizations faced with the uncertainty of the strategic decision-making can then find viable and simple solutions to improving the mental power of forward modelling and addressing market demands.
What is Social Cognition?
With greater awareness enhanced by the recent insights into the mind, we begin to realise that the information we perceive as individuals is not adequate to determine reality. In fact, missing data is supplied by our own brains. Accordingly, perception is a mere product or end result of our own memory. SDM is no exception to this fact of individual fallibility. Social cognition contains the solution to the challenge of individuality. It relies on shared learning and discovery of meaning through language and cultural habits – namely by interface with others.
A major component of human evolution is social, including institutions, the recognition of symbolic structures, sense-making, and collaborative - even competitive - activities, such as business interaction. Recent research on the brain shows that the ability to intentionally address the social brain will be a distinguishing leadership capability in the years to come.
The Starting Point: A convincing case
Mulally, the sixty-four year old veteran executive explains ―I am here to save an American and global icon‖. At FM he says he has to have found a home, a place to recover balance and to take pleasure while doing it. ―I have been through a lot of cycles. I am not up and down. I am rock solid. I am steady. And everybody knows why I am here. It is not a career move. I am not trying to get ahead. I am not looking for more awards.”(Fortune Magazine,
Precisely because Mulally had no experience in mass marketing or dealer relations before joining FM in September 2006, he delegated product decisions to professionals
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in these fields. This is unsurprising from a man with long-standing business experience. Yet he is distinguished from other strategic thinkers by his cognitive and behavioural expertise in building revolutionary collective mental maps to lead him and other key people through the complex scenario of decision making. Hence the way he significantly used NM tactics to implement his transformational vision. Mulally‘s enlightened approach is summarized by the following three ideas which neatly encompass solutions to improve SDM:
1. living in the moment;
2. enhancing social cognition; and
3. finding a new language based on images.
Living in the moment:
Although Mulally is conscious of the notion of a time line, he is committed to the now of a situation. According to previous comments, time is experienced as having occurred either already (past) or not yet (future). Drawing on new understanding of the functioning of the brain, the NM techniques encourage the philosophy that time is a constant now. Mulally in fact applies what NM seeks to show as a successful tool to address the problems caused by holding on to old patterns or thinking models.
o To be efficient, the brain must produce future action swiftly. We now understand that there is no absolute moment in time in which consciousness takes place. The following familiar illusion needs to be discarded: evolving as an unconscious intention, an act-initiation develops deep in the brain, then slowly advances into consciousness and finally reveals a vision.
o Using the NM approach, the temporal properties of the represented (actual) become important, rather than the temporal properties of the perceived (expected). So the very act of probing to discover when decisions take place - and how they are formed – will precipitate narratives that in turn influence the revisionary systems of representation used by the brain.
o Living in the moment emphasises the significance of the constant now. This offers a less intuitive, more systematic approach to SDM, avoiding the tendency for the formation of thought sequences.
o Mulally supports these understandings of the process and, as a leader, promotes the idea that time is a constant rather than a resource. This notion of the constant reduces the stress and the uncertainty involved in SDM, since the key elements of the decision revolve around the properties of the represented and not those that belong to an unknown future.
Enhancing social cognition:
“When I arrived, there were six or seven people reporting to Bill Ford, and the IT person wasn‟t there, the human resources wasn‟t there‖, says Mulally. ―So I moved up and included every functional discipline on my team because everybody in this place had to be involved and to know everything‖. Mullaly believes that teams of decision-makers should be inclusive: all the individuals on the team should be able to access – and process – the necessary information. A well taken instance of neurons that fire together, wire together. Because the starting point of SDM is never fixed, Mulally understands that the actors involved in SDM play different roles at different times. Going back to the analogy of the theatre, he stresses the fact that
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such theatre is about rational agency but also intuition and shared mental maps that need to be flexible, connected and in permanent communication. The model so closely resembles the interconnectivity of the parts of the brain, that it seems as though Mulally has been inspired by its very structure.
o Neurological nets create patterns. Any human brain relies on them for processing information. Yet these nets are not inert - they reflexively work together according to the plasticity required by the tasks at hand.
o When Dennett speaks about the evolution of the brain‘s functioning system, he says: ―The candidates for selection (brains) are various brain structures that control or influence behaviours... Amazingly, this capability, itself a product of genetic evolution by natural selection, not only gives the organisms who have it an edge over their hard-wired cousins who cannot redesign themselves, but also reflects back on the process of genetic evolution and speeds it up‖. This is commonly known as the Baldwin Effect1.
o At FM, Mulally fosters interaction and learning by examining the actions of others. Forward modelling then becomes much more reliable. The action planning process simulates this aspect of brain functioning: the mirror neurons involved in thinking seem to couple with the reward expectancy values provided by the emotional human systems that estimate costs and benefits of alternatives. Mulally make use of this in a more NM way, since he enhances and speeds up the process by adopting the inclusive team approach. This model relates to the openness of social systems as it rewards value-innovative ideas.
Speaking a new language of images:
In essence, all brains are machines of anticipation. From these investigations, we realise that below the surface of what we think we see, are aspects of reality that we reconstruct and elaborate on whenever our minds need to perceive a required representation.
o “How can I tell what I think until I see what I say?” (E.M. Forster, 1960). In other words, auto-stimulation is needed, such as speaking aloud. The acts of talking and hearing build a virtual wire between the broadcast of information and the relevant subsystems involved in the creation of meaningful forward models.
o ―We speak, not only to tell others what we think, but also to tell ourselves what we think‖ (J. Hughlings Jackon, 1915). There are difficulties in connecting new neural nets, unless the brain picks up on errors and corrects them. The mirroring effect of others is required to pick up natural biases that cause the mental ―blind spots‖ to occur with communication, again not being fully aware of the meaning of the surface and deep structures of language.
o However, talking aloud only represents one possibility. The one mostly used by the human mind is thinking in pictures. The language of images is probably the most significant.
1 The Baldwin effect, also known as Baldwinian evolution or ontogenic evolution, is an early evolutionary theory put forward in 1896 in a paper "A New Factor in Evolution" by American psychologist James Mark Baldwin which proposes a mechanism for specific selection for general learning ability.
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o Mulally is able to communicate his vision for FM with visuals. During meetings, distractions are strongly discouraged: communicative devices such as Blackberries are banned, and if someone needs to be interrupted, the meeting will stop. No big deal, you would say, it is a question of respect. Yes, but respect of what? The short answer is respect of the mind and its intricacies. When we take into account that no other animal brain can represent the smell of a fine old red burgundy or Vienna or the Pi number, respect becomes the attitude of revering the learning adjustments that a human brain implements every time it is confronted with representation.
o To monitor any decisions to do with change, Mulally has instituted another two visually-based working methods. Firstly, reports have been colour coded: green for good, yellow for caution and red for serious problems. If not all are green, the plan will be modified. Secondly, Mulally has set up two adjacent rooms, the walls of which are lined with 280 performance charts. These are ordered by areas of responsibility. Executives-in-charge are responsible for their sections‘ charts and use them as a construction platform to guide their decisions.
o These ideas came to the CEO when he first arrived and asked to see the product line-up. He was immediately stunned to find no Taurus. The model has been renamed the Five Hundred. How could there be FM without a Taurus? Doesn‘t brand building cost billions?
o Try the following thought experiment: can the mental picture of the Five Hundred replace that of the Taurus? Picture a purple cow and then a yellow cow – ask yourself, what is the difference? The answer would be obvious: the first imaged cow is of a different colour from the second. These events that occur in your mind are tightly associated with your particular imaginings, and with associated values, principles and attributes. So since the Five Hundred and the Taurus are both cars, what are the differences between the Five Hundred and the Taurus? Well, that is what brands are about and what strategic thinking requires. The Taurus is an icon for FM while the Five Hundred in comparison is more of a secular, well-designed vehicle, with a new platform indeed but still not yet worshipped by the public.
o Marketing, as well as SDM, has to find competitive and differentiating factors for companies to thrive. Often, though, when you look into the mind of a decision strategist, you discover that there is nobody home.
An update on emerging markets and how FM is addressing the challenges offered in India more specifically, can be linked back to the previous sections in which NM has identified key success factors for stabilizing the organization even in times of economic turmoil. Back in 2006, FM said it would increase its production and presence in Asian and African markets. Ford planned thereafter to ―rapidly expand its presence in the fast growing market‖ of India by launching eight new vehicles in the Asian country by the second half of decade, in order to meet the surging demand overseas. The company‘s stock rose more than 1% after announcing more than 30,000 Ford Figo subcompact vehicles were sold in only 25 weeks in that market. With success in India, the automaker plans to export the subcompact, specially designed for overseas market where small vehicles are selling, to 50 emerging markets including Mexico, North
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Africa and the Middle East, starting in 2011. Export to the South African market has already begun in May.
The company eyes on these new markets as it predicts that 70% of the global growth will be from Asia and Africa over the next decade. ―It‘s very important for carmakers to be in emerging markets, because that‘s where the growth is,‖ said Kirk Ludtke, analyst for CRT Capital Group. ―Over time, as the economy develops and as average incomes rises, the consumers in those areas can afford increasingly expensive vehicles, so carmakers can benefit from a favorable shift and mix.‖ The Figo is manufactured in India and has been successful enough to export, said Ford. ―The transaction prices might be lower in India, but the vehicle itself is probably equipped in such a way that they can deliver it at a profit,‖ said Ludtke (Seer Press, August 2010). The point is that thanks to the solid pillars embedded in the strategic vision of the ―Way Forward‖ and the superb execution that has followed Mullaly‘s understanding of what managing with brains in mind means, FM has crossed international boundaries with very limited damage.
This reveals three interesting and interrelated phenomena: 1) Plasticity of thought processes depend on leadership styles; 2) Viable models of strategic decision-making are applicable to very heterogeneous environments and contexts; 3) Success of marketing strategies is not structure dependent but rather market driven from the inside out, from one mind to one kind, and from one product to one market. This is why in the end, the task of good decision-makers can be simply stated as that of evaluating the balance between mental ―primitive jargon‖ with automation of creative processes adaptive to the new challenges.
Tapping into the NM components of decision-making
Because NM addresses the fundamentals of actuarial intelligence it can be explained through the definition provided by Boehm (1999). People are the only living species capable of computing long-term costs and benefits of complex social systems and to maintain the intricate forward-looking accounts necessary for executing the appropriate actions that keep the system working. Strategically, this is an issue that has to do with co-operation, competition and co-opetition. Accordingly, NM is a technique that triangulates inter-subjectively amongst teams and mediates at the individual level between the non-conscious and the conscious components of the mind.
o First case scenario: Social triangulation Let us consider the very basic economic unit of social interaction: the transaction. At its minimum, a transaction not only involves two agents but most importantly perhaps involves the object or objects of the transaction, hence a triad. These objects are the physical and / or symbolic artefact of the intentional mental states guiding the agents involved in the transaction. Interestingly, these objects then constitute the representation of a common cognitive content maintained not just at the level of awareness but also at the non-conscious level of the mental constructs enacted in the transaction.
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o Individual mediation Similarly, following on the approach of triangulation, mediation considers the hurdles involved in tapping into the individual mind without disrupting the flow of consciousness. Humans use imitation and learning tools to improve their personal skills. As Nietzche reminds us: ―Consciousness generally has only been developed under the pressure of the necessity for communication‖. There is a larger idea here, and it involves the constant tension in the mind between paying attention to the outside world versus our own internal thoughts. Mind wandering is a natural state. In recent years, scientists have begun to see the act of daydreaming very differently. They have demonstrated that daydreaming is a fundamental feature of the human mind - so fundamental, in fact, that it is often referred to as our ―default‖ mode of thought. Many scientists argue that daydreaming is a crucial tool for creativity, a thought process that allows the brain to make new associations and connections. Instead of focusing on our immediate surroundings - such as the message of a church sermon - the daydreaming mind is free to engage in abstract thought and imaginative ramblings. As a result, we are able to imagine things that do not actually exist, like sticky yellow bookmarks.
Bringing it all together to enjoy our experiences
In the first quarter of 2009, Genesis Management Consulting (GMS) collaborated on a survey to obtain greater understanding of challenges and best practices associated with strategic decision-making. The research covered organisations from most industry sectors and from all around the globe. The areas in which organisations believed they could improve were: Pre-Decision, Decision and Post-Decision.
Not surprisingly the main aspects affecting decision-making were identified in people and processes. Members of the team were not sufficiently prepared, inter-company politics impacted negatively on the decision and people lost sight of the priorities when they sought to implement the strategies chosen. In terms of flaws in the process, too much attention to the financial aspects and the lack of challenge of deep assumptions were highlighted as important components to improve on. Time was also mentioned and affected significantly the review of the whole process while complaints showed that despite the financial indicators, scenarios were not sufficiently accurate to include relevant risks affecting the survival of the companies.
Our framework states the following five points which although not laid out in great detail as they go beyond the scope of this paper, offer initial solutions that reinforce the ideas discussed throughout the text.
In line with Mulally‘s strategic model of emerging market penetration, we suggest three points complemented with other two from our analysis of the data collected:
1. Living in the ―now‖: part of what contributes to a successful outcome in strategic decision-making is creating momentum. Institutionalizing the process as an ongoing story about the topic of Deciding has no fixed beginning or end but simply stands in the present moment, puts in place a formal process that is sufficiently stable to handle continuities in patterns while accommodating the required evolutionary changes, particularly in emerging markets where growth is
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constantly reinventing value chains, business models, product categories and marketing campaigns.
2. Leadership: everybody understands the first point about the ongoing narrative. Deciding permeates corporate and business cultures and allows people to define their roles clearly according to the framework imposed by the issues at stake. Everybody also acknowledges that roles are similar to those of the different parts of the brain which collaborate to bring awareness without relying on the single Central Executive. As in the mind, the theatre of organisational decision-making becomes an open system and the parts of it contribute to the greatness of the performance since they are interconnected. This in turn feeds the entire organization and allows individuals to connect with social cognition at all levels. As Mulally puts it: ―Three things we need: ―To communicate, to communicate about the fact we are communicating and finally to communicate we have communicated...‖
3. Check-lists: the plan matters. It indicates direction, variables and goals. The plan anticipates and is alive, uses events as platforms to reflect upon emerging strategies, keeps an eye on the competitive map and signals red flag conditions. The check-list, however, includes the less formal or more intuitive mental components. It is therefore a tool that incorporates images of the organisation and its position in the markets: both the internal spaces of social interaction as well as the external negotiations with stakeholders.
4. Mediation: people are trained to surface their deep mental constructs and to develop a language that is thorough in its speech acts. Individuals are converted in their own masters or teachers as they learn to identify the Deletion, Distortion and Generalization phenomena that jeopardize the flow of their expressions and do otherwise prevent the identification of balanced set of choices.
5. Techniques that work: finally, quality of the process leading to good strategic decisions is assessed on the basis of financial performance, on the non-intrusiveness of the learning process and the insights acquired into the inter-subjective nature of human interaction. Balance prevails.
Concluding remarks
Although uncertainty is irreducible in all endeavours of human life, risk can be controlled and managed. Not all decisions are the same nor do they suffer from the same amount of risk, but all situations can benefit from greater awareness of what is desirable and what is not to achieve good decisions from the corporate culture. Simple approaches like the ones described in this paper have a strong and long-lasting impact on people because the most important objective they reach is to allow individuals to better understand some of the mysteries of the mind. If wisdom is the gift of a few, one of the key roles of CEOs and experienced chairmen consists in leading others to learn along the way and contribute to the reduction of unnecessary risks while changing the decision making process into a more responsible and efficient activity.
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Short Biography
Ianna Contardo: Before joining SP Jain in July 2010 as Associate Dean of the Global MBA & Head of the Neuro-Marketing Center of Excellence in Dubai, she was a Professor in Business Strategy at the IE Business School - Madrid since 2000. Ianna registered the brand Neuro-Strategy® (no. 2.842.430), a pedagogical and consulting technique which addresses the challenges of strategic decision-making and organizational training. She uses it to lead and guide the SP Jain Center of Neuro-Marketing in the areas of business research that relate to corporate projects – Emami, Marico, DHL - and executive education. In addition to her academic schedule, Dr. Contardo is a Senior Researcher in Strategic Marketing for Olson Zaltman Associates, a company co-founded by Gerald Zaltman of the Harvard Business School and Gerald Olson of Penn State University. The research and consulting firm specializes in techniques which target consumers‘ implicit thoughts, feelings and knowledge base. Included within their diverse clients are Pfizer, Microsoft, Cadbury Schweppes and The Coca-Cola Company. Her publications address topics such as Neo-Institutionalism, Competitive wars, Language games, Management-Buy-Outs, Irony and Epistemology. Ianna holds a PhD from Warwick Business School in ―Strategic Management and Marketing‖.
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