In-Depth Understanding

In April, my old employer, the Boston Consulting Group (BCG), and BusinessWeek released a study indentifying the most innovative global companies.   The report is based on a survey by BCG of 2,700 senior executives “representing all major markets and industries.”   Of even more interest is the research report published by BCG detaling the survey’s complete findings .  (I will provide links to both the BusinessWeek article and the BCG research report at end of the this blog post.)  The research report gives considerable more depth on questions like why a company would want to be an innovator, what degree of importance enterprises ascribe to innovation, what the actual contributions are to operating performance of innovation, and what factors facilitate innovation? 

First, why innovate?  BCG found that companies that rank as innovative have stock market performance that is 30% higher over 10 years compared to companies that are not considered innovative.  In this “big fish eats the smaller fish” world, a stock price premium of 30% can be tantamount to survival.

Second, how important is the need to innovate perceived to be?  Two out of three senior executives rank innovation as one of their top three strategic priorities. 

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Woody Allen is famously reported to have said, “80% of success is showing up.”  Well, there is something about the ROI for a strategic research portal that is analogous.  By simply concentrating all of a company’s market research in one repository that is available to everyone involved in strategic business or product  research, huge benefits can be realized without a lot of fuss.

One of our clients just gave us a wonderful example.  They were in a super-time-pressured bidding-war for a potential acquisition.  Like most Fortune 500 companies, this client is global, with many geographic and product divisions around the world employing thousands of people in marketing, strategic planning, and product research.  The acquisition team that was assembled to consider the opportunity was not aware of anyone inside the company who had studied this market in great depth.  Mostly, the acquisition team was using market analysis provided by the target and what they could find with general searching on the Web.  Based on information from these sources, combined with a corporate interest in entering markets like this one, the acquisition team was preparing what was hoped would be a winning bid of over $50 million for the target company.

One of the members of the acquisition team thought to check their new Northern Light SinglePoint Strategic Research Portal to see if there were any reports in the research repository evaluating the market addressed by the potential acquisition.  There in the aggregated collection of tens of thousands of reports from around the world, the acquisition team discovered studies of the market segment preformed in earlier years by different geographic and product divisions.  These studies had not been carried out in the time-curtailed setting of an acquisition bidding-war that demanded an immediate response.  Rather, the study teams had the luxury of sufficient time to research trends in fine detail, to challenge conventional industry wisdom, to question commonly-held assumptions, and to evaluate emerging alternative technologies that addressed the same underlying customer need.  Significantly, the prior studies raised serious questions about the long-term potential of the technical approach being pursued by the acquisition target.  With this knowledge in hand, our client dropped out of the bidding and avoided a $50 million mistake.

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Meaning extraction.What exactly is that, you ask?  Other than a catch phrase, one of those one of those unique combinations of words that marketing folks crave to have associated with their brand.I submit this definition of “meaning extraction” for your consideration:

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When it comes to SinglePoint  market research portal implementations, our clients have experienced quantifiable savings in a number of areas that are well worth remembering when the time comes to build the corporate case.  Since we get the ROI question all the time, I thought I would share what we know about this topic with you.  Here are some things to consider: 

• Cost of time saved.  Our experience is that, even when done conservatively, the value of time saved can be pretty staggering when faced head on with a calculation.  For example, our client Verizon estimates that its SinglePoint saves 1.5 hours per user session.  Our average client runs 36,000 user sessions per year, and saving 1.5 hours per user session would total 54,000 hours of saved professional time per year.   One can cost out professional time at perhaps $100 per hour fully-loaded, so such a savings could be valued at $5.4 million per year.  Yikes!
• Improved decision making.  Without a simple to access and use comprehensive research portal, the fact is that most users give up and stop looking for the best information that bears on their projects and just make do with whatever they can find.  One of our clients estimated that critical strategic research projects before their SinglePoint portal was implemented were often attempted using Google’s Web search engine for an average of six hours of research, with the result most often being failure to find relevant, high quality information.  With SinglePoint, users have the best information available on every search easily and quickly, and even more important than the time they save is that their business analyses are well-informed.  What is the value of having better researched and analyzed business decisions?  It could easily dwarf all the millions of dollars of savings combined from all the other ROI considerations.·        
• Supporting Large numbers of users with limited staff.  In this era of budget cuts and staff reductions, a self-service market research portal makes it feasible to support a wide audience of consumers of research with a very limited internal staff.  For example, one of our clients has one person supporting 5,000 users of secondary research via a SinglePoint portal.  Another client has 5 people supporting over 50,000 users of secondary research using SinglePoint.  In another case, 6 internal market research professionals produce important original research reports and publish them to an audience of 300 users in the marketing department via the SinglePoint portal without having to allocate precious researcher time away from the task of actually doing the research in order to field numerous requests from users for reports that already exist.  In all of these examples, without the SinglePoint portal significantly more staff would be required to help the users of research find the research that had been purchased or created for them.
• Obtaining new business.  Each organization has a good idea of what value a closed sale might bring to the table or what being able to rapidly respond to a competitive situation means to a company.  Most of Northern Light’s clients use SinglePoint to prepare for sales presentations, customer briefings, and to assess their product roadmaps to make them more competitive.  Our client HP requested success stories from its sales and marketing staff to document the contribution of HP’s SinglePoint (which they call MarketVision) to business and customer wins, and so many poured in that they had to stop collecting them because the market research staff did not have time to read them all!  Suffice it say many millions of dollars was identified as having been won with direct support to the sales and marketing teams being provided by HP’s SinglePoint.
• Reduced number of websites/portals.  It is not uncommon for departments and functional groups within an organization to provision and field numerous websites, each facing a different audience such as Sales, Marketing, Product Management.  HP has spoken publicly of having saved many millions of dollars when SinglePoint enabled them to unify 150 distinct intranet sites that hosted research in all their divisions around the world.  On the IT side alone, they saved in excess of $1 million, in year one, in hardware and administration.
• Intellectual property issues and fair usage.  It is easy for users to unknowingly violate the usage terms of their agreements with sources of secondary research — an exposure that no large company wants. This happens when users post documents to multiple internal portals without any system for enforcing licensing arrangements.  For example, Northern Light was told of one company that does not use SinglePoint that was presented with a $460,000 bill from a market research provider for a single report that a well-meaning but naive employee carelessly posted to a departmental website for general consumption without access controls reflecting the report’s seat license business rules .  Northern Light SinglePoint enforces the terms of the content licensed and frees organizations from day-to-day concern with such usage issues.
• Consolidated purchasing of information.  Duplicated and underutilized information contracts are the norm in many large organizations.  SinglePoint makes consolidated licensing and enterprise-wide sharing of purchased content a practical goal. For the many clients who have adopted this approach, the savings are substantial.   HP has estimated that its SinglePoint portal saves them over $1 million per year in avoiding duplicate research purchases in their operations around the world. 
• Primary research savings.  Primary market research projects are, by nature, strategic and closely held ventures.  And they are very expensive undertakings.  Often, the research has already been performed but the reports are neither widely known nor findable since they are scattered on network folders and laptops.  SinglePoint can consolidate primary research into a single repository and make it available to authorized users throughout the organization.  This can eliminate the need for duplicate primary research, saving substantial amounts of money and increasing the impact of primary research that has been performed.

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