The following interview was conducted by Marketing Mag out if Iran.
1. You used the 4A’s of marketing for the first time. Please elaborate on these four concepts and tell us if you think these four A’s are more important than the four P’s.
4A’s and 4P’s of marketing are complimentary and interrelated. The 4P’s of marketing involves making marketing decisions about Product (brand) , Price, Promotion and Place, and allocating resources to achieve the 4A’s of marketing. In other words, the 4P’s are inputs and 4A’s are outputs.
2. You are the author of the book, The Self Destructive Habits of Good Companies. Would you please tell us what these habits are?
Based on research, I have identified seven bad habits of good companies. They are as follows: (1) Denial, (2) Arrogance, (3) Complacency, (4) Competence dependence, (5) Competitive myopia, (6) Volume obsession and (7) internal turf wars. The book narrates how good companies with one or more bad habits have destroyed themselves. The book has been translated in at least ten languages so far and seems to have struck a cord with executives and leaders.
3. You have designed a model to explain how communal decisions are made in the organization. Would you please tell us more about this model?
In most organizations, decisions are made collectively by several departments and their representatives. For procurement, this includes engineering, finance, operations and purchasing departments. In the case of capital expenditures, such as plant and machinery, you also have outside consultants and compliance departments. When there is joint decision making, buyers, users, payers, influencers, gate keepers and decision makers often experience conflict about perceptions of alternative and even about desired outcomes. This conflict inherent in joint decisions is often resolved by difficult tactics including bargaining and politics. This model of industrial buying decision has become a good tool for the sales organization of supplier companies. What matters is not just rational, but also psychological or behavioral economic behavior.
4. What are the most important issues in industrial marketing?
There are three key issues today in industrial marketing. First, procurement is increasing centralized on a global basis. Unfortunately, most suppliers tend to be local or regional. Therefore, they cannot offer global reach to an industrial customer. This often results in global mergers and acquisitions among suppliers, especially in those industries where there are only a few large industrial customers on a worldwide basis. Examples include digital technology, automobiles and retail industries. Second, is increasing reliance upon online procurement. This means a supplier’s product catalog must be web-enabled. It also makes it easier for the industrial customer to shop around the world. And finally, it leads to reverse auctions and commoditization of prices. The third key issue is the ability of the account executive to transform from selling products to selling solutions; and become a trusted advisor to the customer, company and its management. In other words, the sales function is becoming bipolar into two extremes: Sales automation and Team selling. The traditional role of account executive becomes more a role of general manager in charge of key accounts.
5. You’ve authored a book called The Rule of Three: Surviving and Thriving in Competitive Markets. What is the “rule of three?
The Rule of Three is a universal phenomenon of competition. All industries, as they grow and mature, tend to consolidate into three large volume driven competitors. They control between 70 and 90 percent of the market. The rest of the market is served by specialty niche companies who are or should be margin driven – not volume driven. Examples include the beer industry, the soft drinks industry, as well as steel and aluminum industries. The Rule of Three is now becoming global since the liberalization of markets and globalization of competition. This is resulting in global consolidation or alliances, such as in the airlines and cell phone services industries.
6. Would you please refer to your favorite novel, sport and country?
My favorite novels are Perry Mason books written by Erle Stanley Gardner. I have also enjoyed reading Agatha Christie books. My favorite sport is cricket since I grew up in India. My favorite country is the United States of America, followed by Singapore.
7. What is your idea about our country Iran?
Iran has a great cultural history in arts and sciences. As a former Persian empire, this soft power has been enormous in countries, such as India.
8. Our bimonthly is called Tose’ e Mohandesi, which in English, means “market development.” How effective do you think this name?
The name is very effective if you want to remain as a local or national magazine. However, is you want to position it as a global magazine based in Iran, it may have to change the name to “Market Development.” Also is may be desirable to focus on stories and interviews which are unique to market development.