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			The Board's  Fiduciary Responsibility  To Market Research 20 questions for the Board to guide the CEO and the corporation
			Contents
			Abstract The Evidence is in The data Old strategies New Ratio Market Research is the upstream process The Board and strategy M/E Ratio™ tool Twenty questions Reviews and reaction about The Corporate Board About the author Reprint - PDF, 9 pages, 0.15 MB

the Board and strategy

"If the board is to be ultimately concerned with strategy, and it should be, then the board must be concerned with the amount and relevance of the company’s market research activities."

According to Dr. Barry Unger, co-founder of the MIT Enterprise Forum and Lecturer at MIT’s Sloan School of Management, "Understanding a company’s place in its market is the fundamental intellectual discipline underlying the creation of effective business strategy.  If the board is to be ultimately concerned with strategy, and it should be, then the board must be concerned with the amount and relevance of the company’s market research activities.  Strategy must be based on facts, not on wishes."

The board does not manage the company.  Yet the board is responsible for a sound strategy to be in place, for the fundamental direction of the company.  It is the market research data that provides the basis for strategy and for strategic decisions.  Market research enables direction.

Armed with customer and market data, in six months new BDMS marketing staff abandoned or shelved fourteen out of their fifteen engineering projects as unneeded, ill-conceived, or not decisive.  One new product for example, a patient location system called Telocate, had $.3 million invested in engineering with five U.S. patents granted and fifteen pending.  Simple primary market research, performed only after engineering was complete, found that there was no need for patient location.

BDMS’ marketing then proceeded to identify and plainly specify the one technology (a computer-based patient monitoring system called Arrhythmia Recall or A/R), out of the fifteen, for engineering to focus on for decisive competitive advantage.

Michael Nevins of McKinsey & Co. concludes, "Successful companies think of marketing as the essence of strategy rather than as a sales and advertising function.  The shift in spending decisions [toward up-front market research] and control systems [accounting separately for promoting and selling] is the single most common roadblock to achieving marketing excellence."