The Ten Commandments for Business Failure - Don Keough [30]
I’ve become very wary of all studies related to marketing and business management. They have their place, but I’m convinced that we are often measuring the wrong variables and the wrong people are evaluating the measurements.
The classic example for The Coca-Cola Company was the infamous introduction of New Coke in 1985. In blind taste tests that involved little sips of product A versus product B, the sweeter product won. This led us to the erroneous conclusion that Coca-Cola was not sweet enough.
But blind taste tests completely failed to portray the full dimensionality of the product Coca-Cola—its total image and cultural context.
In the United States, Pepsi sales were increasing at the time, so the Coca-Cola leadership, and particularly leaders of the bottler community, were looking for reasons why Pepsi sales were doing a bit better than ours in supermarkets. And U.S. Coca-Cola management began looking for reasons. It was not advertising expenditures or distribution issues, so the problem had to be something else. That led them to focus on the nearly one-hundred-year-old product itself. Researchers asked the question: Was there some specific difference that could be pinpointed and corrected? And so two hundred thousand taste tests were conducted and proved beyond a doubt that it was a sweetness issue. It turned out that sweetness, of course, was not the problem at all. The data masked the reality. All the research in the world doesn’t mean anything if you aren’t asking the right questions. The reality was that there needed to be more intense excitement in the iconic brand. New Coke, in its own way, helped to do that, but it was a painful lesson.
Budget planning also suffers from too much data. Through the years, budget specialists in the Atlanta headquarters of Coca-Cola often drowned themselves in raw data that were next to useless, yet they kept collecting them and refining them according to some internal formula. For example, “The fountain sales department spent X dollars last year on in-store merchandising. Therefore, the department will require X plus Y next year, and we will plan accordingly!” Budget planners never really saw the whole picture.
In the late 1960s and early 1970s a few of us moved to Atlanta from the recently formed Coca-Cola Foods Division in Houston. Our advantage was that we were from out of town. We saw things through different lenses and began to put together a bigger picture. We had some mental distance from issues and took some time to think about the entire operation.
We saw the same furniture everyone else did, but we knew the sofa could be moved.
3. Not Taking Time to Think Is Just Plain Foolish—Even Dangerous
“ ‘Forward the Light Brigade!’
Was there a man dismayed?
Not though the soldiers knew
Someone had blundered:
Theirs not to make reply,
Theirs not to reason why,
Theirs but to do and die:
Into the Valley of Death
Rode the six hundred.”
—Alfred Lord Tennyson
THE LIGHT BRIGADE went charging into the Valley of Death because its leaders just didn’t pause to think. And all the soldiers blindly followed. Soldiers were not supposed to think for themselves, but their leaders were. It’s obvious, but worth noting—one cannot make any real progress in any field, war included, if one just keeps sifting through data and reaches quick conclusions based on previous experience rather than careful evaluation and slow, careful analysis.
Time to think is not a luxury. It is a necessity. As Goethe noted: “Action is easy; thought is hard.” Yet action frequently—in fact, more often than not—takes on a life of its own. We pay homage to reason, but we are held hostage to emotion. We are, after all, feeling creatures,