Know your customer: lessons from the big picture. Article by Clive Black, Advisor

January 24, 2017 12:16 pm
View All Posts

That 2016 was a year of significance is a hard one to dispute. Generalisations always break down when it comes to detail, but the tumultuous events in the UK through the EU membership Referendum, followed by Donald Trump’s more than remarkable election as President of the US rank as seismic political adjustments to my mind.

What caused the ‘knee in the nuts’ for the prevailing political classes is subject to a lot of analysis, debate and no small amount of argument. It is clear that an established political order on both sides of the pond has become detached over a considerable period. An increasing proportion of a largely quiet electoral majority, not minority, were now being heard. It was quite telling when Iain Duncan Smith spoke of reports to him on the evening of the 23rd June that folks were queuing in the housing estates of England to vote after work.

The political change is likely to be seismic for the politico-economy. None of us can know quite how President Trump is going to execute his economic and trade policy. Key issues revolve around deregulation, potentially lower taxes, rising infrastructure spend and, perhaps crucially, trading policy with China. If tariffs are, as promised to the US electorate, applied to Chinese goods, how will Beijing respond? Additionally, how will US business behave? We need only look to Ford’s move from Mexico to Michigan already. What will this mean, in time, for global economic growth?

Closer to home there will be the near term calling of Article 50 by Theresa May. The outcome of this process is likely to be particularly significant for the whole of the EU, albeit probably with a slower burn than Mr. Trumps’ activities. One must hope that common sense will prevail, noting the considerable deficit that the UK has from a trading perspective with the EU.

However, common sense and politics are not always aligned. Michael Gove can probably give a lecture on this after his post-Referendum shenanigans. No doubt Messrs. Cameron and Johnson could too. More to the point, there is a lot happening politically in the EU in 2017 that may mean conventional wisdom on trade negotiations today may not be convention tomorrow. I make this assertion noting 2017 elections in The Netherlands, France and Germany respectively. Quite how this will pan out remains to be seen, but those who thought that Mr. Trump would not be the Republican nominee at the start of 2016, never mind President, may like to think again.

Indeed, following the EU polls, the UK may not be isolated in seeking to leave the EU at the end of the year as at the start. As such, unless the EU/Commission dramatically responds (that is, changes ho hum), the British may not be the last to destabilise the apple cart of the prevailing EU norm. Accordingly, there appears to be a lot of twists and turns to come in the political world, making business planning more difficult, particularly for firms trading across borders. Besides those at play in the USA, China, the EU and the UK, there are also copious dynamics to consider from Cuba to Russia, and Iran to Venezuela.

These political machinations are outside the control of most business leaders. However, what the last year has perhaps brought home is the importance of understanding, insight and intelligence, plus the need to focus on what we can control. Such a statement is hardly a revelation, however it is clear that the political, legal, media, financial and libertarian elites of the Western world have not had the information to hand to be informed, or they chose not to look and listen. Accordingly, a new order that fundamentally challenges some norms and fiefdoms is now in play.

Bringing this high level ‘stuff’ down to the strategic planning, direction and operation of the food industry leads me to ask myself:

  • Do I understand my customers?
  • Am I listening to my customers?
  • Do I have the mechanisms to listen and learn?
  • Am I close enough to the drivers and forces of my market?

Easy questions to pose, more difficult at times to answer, but important ones to be getting right for ongoing and long term business success. Whilst we have limited or no control over the direction of an electorate, or the politicians they vote in and out, we can learn lessons from what their collective opinions and challenges pose for our businesses and how we set ourselves up, operate and execute. There has never been a better time to know your customer.

Happy New Year.

Written by Dr. Clive Black, Advisor to Coriolis Consulting

Image source: http://www.wsj.com/articles/europe-braces-for-shock-waves-from-a-trump-presidency-1478720698