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EVALUATING MARKETING ACTIONS AND OUTCOMES, Advances in Business Marketing & Purchasing, 12
Editors: Arch Woodside
Publisher: JAI Press (Imprint of Elsevier)
abstract of all 9 papers available at sciencedirect.com
FUNDAMENTAL DIFFERENCES BETWEEN SCIENTIFIC AND EXECUTIVE THINKING
Adopting the following meta-thinking view is useful. Executive thinking differs fundamentally from scientific thinking in at least three ways (cf. Kozak, 1996). First, scientists (e.g. academic researchers) get to choose the problem, whereas in organizations, the problems (and symptoms of problems) are often thrust upon the executive (e.g. see Mintzberg, 1978). Second, scientists focus on a limited number of problems at a time; whereas executives are confronted with a vast number of potential problems and a myriad of possible presentation problem frames (see Wilson, McMurrian & Woodside, 2001). Third, scientists have the relative luxury of time to explore the problem at hand, whereas executives, particularly CEOs, do not.
Recognizing and accepting such distinct thinking paradigms aids in taking the next step in thinking about designing prescriptive tools for executives. "The mind that relies on its own processing capacities or intuition for clinical [executive] decision making cannot establish a sound basis for evaluating, in a combinatorial way, all the possible correlations and cross-correlations that exist between patient- [customer or manager] provided features of a given problem and all the possible causes of those features. That is, the mind, unaided by information tools, dealing with complex problems cannot elicit and couple all of the features of the problem to what is known from the relevant scientific literature about those features. Because of this inability to exhaust combinatorial reasoning, clinicians [executives] are forced to make judgments without having considered all the possible evidence that bears on the problem (i.e. they jump to conclusions). Such limitations of cortical processing in clinical [executive] decision making inevitably lead to prejudice and bias ? (Kozak, 1996, p. 1335).
Unfortunately, the natural tendency in decision-making includes:
? drawing conclusions based on very limited amounts of information;
? being over-confident that one?s own initial conclusions are accurate;
? not looking for disconfirming evidence;
? discounting disconfirming evidence if it pops-up;
? being hostile to the belief that using decision tools (e.g. computer software programs such as "Problem Knowledge Coupler (PKC)," see Gaither, 2002) results in more accurate problem framing than one?s own judgment;
? not "thinking outside of the box" and considering all theoretically possible, even if seemingly implausible, combinations of events and their outcomes;
? and implementing a decision with limited consultation with knowledgeable others.
The conclusion is compelling (and findings supported the conclusion have been replicated in several fields of behavioral science) that designing and applying decision tools and simple heuristics lead to more accurate decisions than that made by intuitive thinking alone (see Gaither, 2002; Gigerenzer & Selten, 2002; Gigerenzer, Todd & the ABC Research Group, 1999). Equally compelling is the finding that the use of disruptive technologies (including using decision tools such as PKC) meets with great hostility by entrenched executives (see Christensen, 2000 and Christensen & Bower, 1996). We need to train ourselves in the tools available for "actively open-minded thinking" ( Baron, 2000) because our minds prefer to limit cognitive effort (see Payne, Bettman & Johnson, 1993). Consequently, being "mindful" (see Langer, 1989 and Weick & Sutcliffe, 2002) requires training and, while highly valuable, it is an unnatural mental state. The words of Karl Weick are apt here: "Complicate yourself." Forcing yourself to learn new skills in applying decision tools and reading volumes now before you, are steps to achieving Weick?s advice.
WHO SHOULD READ VOLUME 12?
The intention is for this volume to be read by executives wanting to learn how to reduce overconfidence, and to become more mindful, in making decisions and in learning how to scientifically evaluate the quality of outcomes that follow from implementing decisions. What?s really happening? How can we accurately evaluate the quality of marketing decisions and outcomes? These issues are the central focus of all the contributions appearing in Volume 12.
Where is the Action?
After this introduction, the first paper by Andersson and Kjellberg asks how we can go about accurately reporting business action. The authors provide the basic tools of analysis in storytelling research and theory to enable you to find out what is really happening. Detailed examples are found in the paper that illustrates using these tools.
Narrative and Case Process Research
The second paper includes an excellent literature review on case research for understanding B2B marketing relationships. Andersson summarizes his more than 30 years of case study research and the major contributions of the European-based IMP Group. Andersson?s work helps in particular in overcoming a one perspective bias in finding out what?s really happening.
Integrating Marketing Models with Quality Function Deployment (QFD)
Quality function deployment and the "house of quality" are decision tools useful for designing products and services that customers prefer to buy. In the third paper Aungst, Barton, and Wilson describe how to collect estimates of customer preferences (i.e. utilities) for alternative design features in constructing "House One" via QFD. Along the way, they review relevant literature since Hauser and Clausing?s 1988 HBR "House of Quality" article.
Stakeholder Value Creation and Firm Success
Does an empirical analysis of firm performance support the view that taking a stakeholder perspective outperforms setting objectives to considering a stockholder perspective only ? should the CEO be inclusive in thinking about setting multiple objectives that serve suppliers, employees, customers, and the public, as well as profit objectives? In the fourth paper Koll provides evidence supporting the conclusion that CEO?s should think actively about setting minimum levels of responsiveness to all stakeholder groups.
Building Effective Buyer-Seller Dyadic Relationships
How do salespersons? and customers? individual temperaments and personal value systems affect customer interpersonal satisfaction and repurchase intentions? In the fifth paper Preis, Divita, and Smith delve deeply into this issue. Because buyer-seller exchanges are often essential for marketing-purchasing, careful reading of this report is warranted. Liking one another does matter and nuances when interacting affect liking. The authors offer concrete prescriptions after presenting detailed findings on how to build positive personal buyer-seller relationships.
Trust and Business-to-Business E-Commerce Communications and Performance
Within E-commerce relationships, how is trust built and destroyed? How much does trust really matter in E-commerce relationships? In the sixth paper Ratnasingam reports evidence on how the actions of both the buyer-seller affect trust, and in turn how trust affects the ultimate outcomes of the relationship. She recommends that trust is activity based and thus, develops in stages and from promises delivered rather than promoted.
Internationalizing the Professional Services Firm
What are the nitty-gritty steps that a professional services firm takes to become successful internationally? In the seventh paper Skaates provides detailed answers as well as a review of the substantial literature on how to manage the professional services firm. Her synergy of the European and North American literature is a unique contribution to building knowledge into the theory and practice of managing services.
Business-to-Business Customer Value and Satisfaction
In the eighth paper Woodruff and Flint offer an expansive view on managing customer value. This contribution provides a succinct review on how to measure and manage changes in customer value. The authors? report complements and extends the findings that Aungst, Barton and Wilson describe in the third paper.
In the ninth and final paper, Woodside and Sakai review theories and methods of evaluation. The authors suggest the need to evaluate evaluations and apply their suggestion to evaluating performance audits of tourism marketing programs. They find widespread lack of knowledge of evaluation research among performance auditors as well as tourism marketing executives.
The literature on meta-thinking and deciding is robust and useful in providing tools helpful for reducing problem ambiguity and evaluating marketing actions and outcomes. Reading the literature helps overcome and keep in check one of life?s biggest fallacies; that we usually know what we are doing without using structured search and thinking tools. Reading Baron (2000), Gilovich (1991), Gigerenzer and Selten (2002), and Weick (1995), as well as the contributions in this volume is humbling for learning how what we know that isn?t so, and beneficial for learning to use prescriptive tools for improving decisions.
Bargh, J.A., Gollwitzer, P.M., Lee-Chair, A., Barndollar, K. and Troetschel, R., 2001. The automated will: Non-conscious activation and pursuit of behavioral goals. Journal of Personality and Social Psychology 71 September, pp. 230?244.
Baron, J. (2000). Thinking and deciding (3rd ed.). Cambridge, UK: Cambridge University Press.
Campbell, D.T., 1969. Reforms as experiments. American Psychologist 24, pp. 409?429. Abstract-PsycINFO
Christensen, C. M. (2000). The innovator?s dilemma. Cambridge, MA: Harvard Business School Press.
Christensen, C.M. and Bower, J.L., 1996. Customer power, strategic investment, and the failure of leading firms. Strategic Management Journal 17, pp. 197?218. Abstract-ScienceDirect Navigator | Abstract-Compendex | Full Text via CrossRef
Clemen, R. T., & Reilly, T. (2001). Making hard decisions with decision tools. Pacific Grove, CA: Duxbury.
Gaither, C. (2002). What your doctor doesn?t know could kill you. The Boston Globe Magazine (July 14), 12 ff. Boston: Globe Newspaper Company.
Gigerenzer, G., & Selten, R. (2002). Bounded rationality: The adaptive toolbox. Cambridge, MA: MIT Press.
Gigerenzer, G., Todd, P. M., & the ABC Research Group (1999). Simple heuristics that make us smart. Oxford, UK: Oxford University Press.
Gilovich, T. (1991). How we know what isn?t so. New York: Free Press.
Kozak, A. (1996). Local clinicians need knowledge tools. American Psychologist (December), 1335?1336.
Langer, E. J. (1989). Minding matters: The consequences of mindlessness-mindfulness. In: L. Berkowitz (Ed.), Advances in Experimental Social Psychology (Vol. 22, pp. 137?173).
Mintzberg, H., 1978. Patterns in strategy formation. Management Science 24 4, pp. 934?948. Abstract-INSPEC
Payne, J. W., Bettman, J. R., & Johnson, E. J. (1993). The adaptive decision maker. Cambridge, UK: Cambridge University Press.
Senge, P. (1990). The fifth discipline. New York: Doubleday.
Shadish, W. R., Jr., Cook, T. D., & Levitton, L. C. (1991). Foundations of program evaluation. Newbury Park: Sage.
Tversky, A., & Kahneman, D. (1982). Evidential impact of base rates. In: D. Kahneman, P. Slovic & A. Tversky (Eds), Judgment Under Uncertainty: Heuristics and Biases (pp. 153?160). Cambridge, UK: Cambridge University Press.
Wegner, D. M. (2002). The illusion of conscious will. Cambridge, MA: Bradford Books, MIT Press.
Weick, K. E. (1995). Sensemaking in organizations. Thousand Oaks, CA: Sage.
Weick, K. E., & Sutcliffe, K. M. (2002). Managing the unexpected: Assuring high performance in an age of complexity. Ann Arbor, MI: University of Michigan Press.
Wilson, E.J., McMurrian, R.C. and Woodside, A.G., 2001. How buyers frame problems: Revisited. Psychology and Marketing 18 6, pp. 617?655. Abstract-ScienceDirect Navigator | Abstract-PsycINFO | Full Text via CrossRef
Woodside, A. (1999). Evaluating alternative pricing strategies for market introduction of new industrial technologies. In: Advances in Business Marketing and Purchasing (Vol. 8, pp. 181?186). Amsterdam: JAI Press, Elsevier