Photo by Richard Clyborne of Music Strive
Client note by Stuart Theobald
The recall of the finance minister on Monday last week in the middle of a crucial international roadshow, and then the subsequent cabinet reshuffle announced early on Friday morning, triggered an unprecedented response from organised business. Business Leadership South Africa put out a statement describing Gordhan’s recall as “ill advised” on the same day it happened. Three days later, last Thursday, BLSA was even more strident, questioning whether the president was really putting the constitution first. Using words unprecedented for organised business it said, “The membership of BLSA urgently calls on the President to demonstrate that he acts in the national interest. His powers are not without responsibility.” And then when the cabinet reshuffle was announced on Friday, the wording was even more strident: “We strongly condemn the action. It is irrational, ill-timed and completely disregards the national interest.”
Other organisations were similarly strident. The Banking Association declared, “The actions of the President have put our country into turmoil, at a time the country is trying to come together to address the problems we face. We have no choice but to say this reshuffle is not in the best interests of the country. We are also left with little choice but to question the motives behind this action.”
The CEO intiative, which was set up to partner with Treasury and organised labour early last year to defend the credit rating, was similarly strident: “The CEO Initiative is gravely concerned and disappointed by the ill-timed and irrational dismissal of a trusted and well-respected Minister of Finance and Deputy Finance Minister. This decision, and the manner in which it was taken, is likely to cause severe damage to an economy that is in dire need of growth and jobs.”
But just what should CEOs be saying publicly where their brands are exposed?
Speaking through organised business structures takes the attention off individual brands. This can be a “safe space” for business leaders to speak out because the words aren’t directly related to their businesses. In making political statements, the risk is always that it will affect your brand or else it could lead to conflict with politicians that would damage business done with government. We have examples of this from the past. In 2007, FirstRand prepared a major campaign to get the public to write to then-president Thabo Mbeki to do something about crime. It was cancelled at the last minute after politicians intervened with management to warn that it would damage the group’s relationship with government.
The stakes now, however, appear much higher. We still don’t know why president Zuma dismissed the finance minister and his deputy, but we do know that they were top performers, doing a valiant job on behalf of the country and economy. There is every reason to think their dismissal was motivated by illegitimate ambitions.
So far, however, few business leaders have spoken up on behalf of their companies. Standard Bank joint CEOs Sim Tshabalala and Ben Kruger published a statement praising minister Pravin Gordhan and deputy Mcebisi Jonas, saying they “deeply regret the President’s decision to relieve them of their offices. We do not dispute the absolute prerogative of the President to appoint and dismiss Ministers as he sees fit but, on the publicly available information, we do not believe this was a well-considered or constructive decision.”
More forceful comments have been made by business leaders speaking through organised business. AngloGold Ashanti chairman Sipho Pityana has been most vocal, founding the SaveSA campaign to directly lobby for Zuma to resign. On Friday at Church Square he described it as a “fight for the sovereignty of the nation.” He has already directly criticised the new finance minister, Malusi Gigaba, saying the crisis in state-owned enterprises begun under his watch.
Shell South Africa chairman Bonang Mohale, who is also deputy chairman of BLSA, has been more restrained but still criticised the decision for unsettling the markets, asking “why in God’s name would we break something that is just beginning to work” the day before the finance minister was fired. His platform, though, tends to be BLSA rather than Shell.
The fears over the effect on company brands might well be overdone. In my discussions with institutional fund managers, they are increasingly enthusiastic about more CEO activism. Their portfolios depend on financial stability and long term economic growth, both of which are threatened by the poor political environment. Company leaders should be worried about the same thing. Most of our customers are also very worried. Appearing to take a stand, to speak out, and taking actions like allowing employees time off to join protests, could be rewarded with customer and shareholder loyalty.
By Heidi Dietzsch
If you’re buying a house, chances are you’ll look at the a variety of properties for sale, compare prices in different areas, try to get a feel of how much its value will appreciate over time, and of course visit the house, check for damp and generally try go find out if there are any hidden risks.
Not doing so could jeopardise not only your investment but also your peace of mind.
It would be about as crazy as making business decisions without the appropriate market research. Strangely, many business owners neglect this vital aspect of managing a business.
Businesses need to understand their markets to ensure that the right products and services are provided. Market research is essential for a brand’s long-term success and will keep a business afloat while businesses that fail to make research a priority, drown.
The results can be dramatic. Here’s a case study of how a world leader in industrial packaging products and services increased sales by $3m as a direct result of customer satisfaction research.
The concept of market research can be daunting, and many business managers unfortunately perceive it as being just a lot of extra work. Some might not want to conduct market research because they are simply too afraid of hearing negative feedback. They believe that their products and services need no improvement and they do not want to risk changing their ways.
Many businesses are also not familiar with the benefits of market research, nor are they aware of the distinction between market research and marketing research. These two terms are often used interchangeably, but they have differentiating qualities.
Market research deals specifically with the gathering of information about a market’s size, trends and preferences. This information is then processed and analysed and presented to businesses. The goal of market research is generate data on which to base your business decisions.
Marketing research is much broader and aimed at gathering information on all aspects of marketing. It also refers to the process of gathering, processing and analysing information for the purpose of marketing a product.
The European Society for Opinion and Market Research (Esomar) defines market research as the “systematic gathering and interpretation of information about individuals or organisations using the statistical and analytical methods and techniques of the applied social sciences to gain insight or support decision making”.
The American Marketing Association defines marketing research as “the systematic and objective identification, collection, analysis and dissemination of information for the purpose of improving decision making related to the identification and solution of problems and opportunities in marketing ”.
Market research is not an activity conducted only once. To benefit fully, it should be an ongoing cycle for businesses. It gives businesses a competitive advantage.
There are hundreds of ways accurate market research can help a business, and that’s why every business should conduct beneficial research. Imagine two banks similar in size – but only one conducts market research.
The bank that doesn’t conduct research might not know that its products and services do not meet client expectations. It will be oblivious to the fact that staff in its branches are perceived to be unfriendly and unprofessional, that its ATMs are often not functioning and are perceived to be unsafe, while its website is considered to be difficult to navigate so more users bank offline.
In contrast, the bank that conducts market research can deal with the above issues before they become problematic. Furthermore, this bank is likely to take the lead in mobile banking, for example, because its research showed that this is an important customer need.
Market research is important for any type of business. In planning to start a new business, for example, any institution approached for finance will ask for your market research. Starting a business always involves some degree of risk and good market research will decrease that risk. For a new business to succeed, it needs to understand its customers and competitors and find a unique position that attracts customers and is well distanced from competitors.
Fledgling and well-established businesses will benefit from good market research. In fact, businesses should think of market research as an investment. Not only could it increase profits and improve a businesses’ performance, it could also increase the businesses’ recognition and help to maintain a good reputation.
It is always crucial to ensure that the most accurate, insightful information is generated in order for businesses to reach their research objectives.