Key to business success
THEODORE LEVITT is the ‘guru’ of marketing. Ever since the publication of his legendary “Marketing Myopia” in 1960, Levitt has been a widely read author and a respected teacher whose name has become synonymous with marketing. Levitt is currently the Edward W. Carter Professor of Business Administration at the Harvard Business School. He is also the editor of the Harvard Business Review.
Prof Levitt, you’ve talked about ‘marketing imagination’ as being the central tool in determining business purpose. What exactly is the essence of the marketing imagination?
If you accept the proposition that the purpose of the business is to create and keep customers, then immediately the focus is on the way an organisation can understand, relate to, and influence in its favour the people around it. Not influence in any devious way, but influence the way in which people’s interests get configured over time.
You then have to try to understand the situation: people, society, the environments in which they operate; the institutions, the distribution centres, the media of communications, and how they affect each other. And since there’s no presumption that facts are equal to information and information is equal to meaning, you have to apply the imagination. Some way of thinking, of transcending the data…the objective is to do such things as get people to prefer to do business with your rather than someone else.
What would you consider to be the key features behind the success of IBM, despite the fact that they started out late and there’s been so much competition?
I think it’s been sensitivity in its responses to the marketplace. If you ask major people in IBM to define it, some of them would understand it, but most of them would not be able to explain it very well, probably because they don’t know - it’s so deeply systemic in the organisation. I think it’s deeply ingrained in the IBM system…
But for something to be so deeply entrenched, surely somebody is doing something which has made this orientation a part of the organisation’s existence. What is that something that has happened at IBM for the customer orientation to be so endemic to the organisation?
I think it came at a very, very early age, when Thomas Watson persisted in demanding a certain kind of behaviour, a certain kind of functioning. Those people who took to it stayed, and those who didn’t, left. So through a process of natural selection, you had a group of people who were close in this vision…
Would you elaborate on customer sensitivity? What does it really mean?
Well, it’s not such a big academic thing that you have to get an MBA to learn it. Somebody calls up and says: I’ve got a problem.
The IBM man says: Yes, Mr. Jones, tell me about it, how can I help you?
He doesn’t say: our service organisation is not in today, or wait till tomorrow, or what do you mean, you’ve got a problem, have you read the manual?...It’s just not done…The whole idea of being responsive is so deeply persistent.
Look at the idea of the uniform for IBM salesman. You had to wear a white shirt, a red tie, a hat…you took a customer out and socialised, but you never drank. What was the whole theory behind that?
With a product category where you know more about the technology and the functioning than the customer, and you promise more than the customer could ever imagine in his wildest dreams…so you have a miracle black box which the customer doesn’t understand, promising something which he wants.
How do you make it credible?
For one thing, the person who represents the proposition doesn’t sound like a hippy, doesn’t look like somebody on drugs, doesn’t look like somebody who’s had too much to drink. He looks proper and straight, he’s got a suit and a tie…he’s sober, he’s not dumb. A profound vision. I don’t know whether Watson ever understood that in any cognitive, rational way…he understood it systematically, in his stomach. He understood it so well, it was uncompromisable.
This brings me to another question. What would you say is the key role of the chief executive in any organisation? Is there something that the chief executive does which wouldn’t happen were he not around?
The key role is determining the purposes and direction of the organisation. Where to go? What to achieve? And he fashions an organisation, a system, for achieving these purposes. He creates the motivations for the people who operate the system, by reward and punishment.
And he constantly reinstates the idea, because everything is subject to entropy, people get tired, they forget…Another important function is determination of the allocation of resources for the organisation. Those are the major functions. They’re not very great but they’re difficult. Easier said than done.
Coming back to what you mentioned earlier, in a very general way everybody knows the marketing concept, and yet marketing history abounds in product or business failures. What are the problems in operationalising this concept?
There are problems, problems of everyday life. Of getting people committed to it, of understanding it, there are problems of making it operational, of maintaining vision…But that’s what the organisation is there for, and people in the organisation to take care of those problems.
I think the process of committing yourself to action, with a certain amount of energy and an ability to deal with adversity, is a process of making things that you hope to achieve, happen.
In your writings, you’ve also talked about creativity and innovation in business. Would you like to amplify these concepts?
Lots of people say that we need more creativity in this organisation, more innovation, and they treat these two words as being synonymous. But there is a difference.
Creativity is about thinking up new things, and innovation is about doing new things.
Innovation is much more difficult than creativity. Although creativity is rare, innovation is difficult. So we mustn’t confuse them, and we mustn’t confuse the creative person for the innovative person. There’s a big difference. A lot of creative people are not very good innovators because they have no organisational patience, they have no patience with the elephantine nature of the world out there…
Is there some sort of organisational environment which is almost a pre-requisite for successfully managing innovation?
Yes. You’ve got to have congruence between the various messages that are sent out, intentional and unintentional.
Some people at some managerial levels say, what we need is more innovation, more new ideas, more creativity. But every time somebody brings something up or suggests something, there is a serious discussion and analysis about it…let’s look at the pros and cons and so on.
The more substantive the analysis is, the greater the likelihood that the proposer of the idea thinks there is opposition building up, a wall of analytical opposition.
So the unintentional message is the opposite of the intentional message.
I’m saying unintentional because the people who are reacting that way are not doing so because of their opposition to anything that’s different, but because they’ve been trained to be responsible, prudent, and analytical. So you have to be very very conscious of the unintentional communications, because on the one hand you want to be responsible, and managerial, and business-like, and on the other hand you also want to encourage creativity and innovation.
What is the role of symbol and metaphor in selling products?
It’s powerful, it exists, and always has. It’s the transformation of literality into symbol systems. Its metaphor is really central, distinctive…People travel from all over the world to come to your country and look at temples that have been uncovered hundreds and thousands of years ago.
Why do people go there? What are those works of art? What do those temples mean?
They are symbol systems designed to reach deep into the consciousness and sensibilities of people to affect them.
The artist, the poet, the priest, the beggar, the pitchman for the product -- they are all basically doing the same thing.
They are engaging in metaphors and symbol systems in communicating to get people to behave or believe differently than they did before they communicated with them.