Feature

posted 20 Jun 2002 in Volume 5 Issue 2

More research less value? How professional firms can get more out of research

As the competition intensifies, consolidation quickens and fewer firms chase fewer clients. In response, firms sense a pressing need to compete more effectively often turning to research to support those objectives. However, these same firms then miss their opportunity, neglecting to use the research that ends up gathering dust rather than being acted on. This article attempts to diagnose the reasons why research doesn’t always deliver and to identify positive actions that firms can take to ensure they make the most of an important opportunity to get value from their research.

Why does research not deliver?

In 1985, the Harvard Business Review turned the research process on its head and proposed ‘Backward Market Research’[1]: getting the team to determine the range of possible actions and using these to drive the information collection process. Subsequent studies and academic papers have all come to the same conclusion; that research is only effective when linked to immediate action. Our own experience of conducting structured surveys in the professional markets supports this, in that typically no more than 20 per cent of the data generated by such surveys is ever used. In essence, on most projects we are asking questions in the hope that they will deliver something useful. This is a highly inefficient way of getting the answers we want, particularly when respondents are so difficult to pin down.

Many projects are seen as having a single aim; to provide some information in an area where knowledge is lacking. Thinking this way means that no-one plans action until the research has finished. This creates an expectation that the information itself will somehow prompt action. It won’t - the team needs to be committed to action from the off, regardless of the research output.

We have found that partners and fee-earners follow a typical pattern in their approach to research projects. Their enthusiasm grows as they hear more about the project and they become more involved in volunteering clients to be surveyed. Their enthusiasm peaks when the findings are presented but it trails off fairly quickly afterwards

The research goes through its own lifecycle culminating in the presentation and the firm starts to design processes and procedures to handle the findings. These might range from assembling a group of partners to discuss how to deal with a great opportunity in one client, through to writing a publication to support a media relations exercise using the findings. As we all know, however, professionals are busy earning fees. Getting them together to think about these things is a problem. By the time the research has been understood, its validity debated and the client opportunity appreciated – oh and the fact that we need to train some partners in sales skills to take advantage of it – the research, and the opportunity, is six months old. Practically, this point is seldom reached. Enthusiasm has dipped below what we have called the ‘will to act threshold’.

Lack of clarity over research and business objectives

Many people considering research think ‘research’ rather than ‘business’ objectives. Good researchers can work out the research objectives for you, providing they know what the business objectives are. Equally, working collaboratively will enable both parties to articulate and understand why they are doing the research and how it is to be used (see below; Scenario Planning).

Addressing firm sensitivity

Most professional firms we work with are (rightly) concerned about whether conducting research will have a negative impact on their clients. Some firms, however, become over-obsessed with this to the point at which it can derail the objectives of the project.

Actually, our overriding impression from conducting professional studies over the past ten years shows that clients desire to give feedback and they see research as a positive way of doing this. In support of our thesis a recent Harvard Business Review article [2] has demonstrated and quantified the potentially positive effects of conducting surveys.

Senior decision-makers are not ‘sensitive flowers’: they know research isn’t obligatory and can easily decline an interview. The overwhelming majority see independent research as an important part of the client-supplier dialogue. Many also relish the chance of communicating via a neutral third party.

In the course of interviewing many survey respondents, the most common response we get is not ‘too much contact from professional firms’ rather, ‘not enough!’ This perception is linked to professional firms being seen as poor at selling their services. Clients also love receiving feedback from client surveys.

None of the above mitigates the need to be rigorous about research quality. Poor interviewers and badly designed questions not only damage the outputs from research but annoys respondents and can damage your reputation. Equally, unprofessional management of the interviewing and appointment process also result in damage.

Partnering for success

If there’s one thing that makes research work successfully it’s a strong working partnership (trust and collaboration) between agency and client. Obvious maybe, but in the complex and highly political world of professional services this must be of paramount consideration. And too many firms still see themselves as buying information rather than working in partnership to achieve change.

The consequences of lack of collaboration are poorly or inappropriately designed surveys, outputs that don’t match the clients expectations and even worse, misjudgement of the sensitivities of the partnership.

Professional services research is subtle and complex and partnerships do not make decisions easily. There is therefore a need to employ high quality researchers; people who can pull out the nuances and take it beyond the ‘so what’. The lead researcher is also the most tangible symbol of the project: they need to have the intellectual standing and gravitas to convince sceptical partners of what the research means and of the necessity for action.

In-house research

Research projects are often conducted in isolation from all other information despite organisations having a research base. Too often we re-invent the wheel without referring to the base of other information that could help us (cost-effectively) to focus on what’s really important.

Analysis and data distillation techniques

Too few professional research projects make effective use of the array of data modelling and distillation tools available. Multivariate and regression analysis tools are now highly user-friendly and represent a fraction of the total project cost. They can highlight vital data correlations that can be used to explain real drivers of client behaviours or attitudes.

Making research work for you

We have identified five actions that we believe will have a dramatic impact on what firms get out of research:

1. Decide actions before asking questions

Typically firms consider what questions they want to ask, commission the research and sit back and wait for the results. The time for action will come when the results arrive. Invariably this means that the organisation will not be ready to act on the results.

Turning the research process on its head involves the following:

Determine all the possible actions that you might take
Write the final report
Decide what analysis is going to be needed
Plan the data collection

2. Use scenario planning to decide your objectives

Spending up-front time on scenario planning is an effective way of kick-starting thoughts about actions and also assists in keeping projects on track - providing of course, that the management is willing to give the necessary time and effort to the exercise.

We advocate the use of scenario planning when deliberating the issues to be researched and then a parallel running mechanism for designing and developing processes and research.

So suppose we are looking for opportunities and threats in a key client account. We might envisage a scenario where this client has a number of divisions, one of which might be looking to find another law firm. We have a great relationship with another division. How do we best present our credentials to the separate division?

3. Spend more on data distillation and revisiting previous research

Although it may at first seem to be daunting, ‘geeky’ and to have marginal value, it is well worth considering at the outset (in conjunction with the researchers) how best to distil the data. Quantitative research outputs in particular can be cumbersome and although good researchers will ‘tell the story’ it is very useful to be able to discard all the irrelevant or overlapping issues and to cut through to the numbers that really matter.

Researchers can advise on statistical methods and models and it is important to discuss at the outset what the potential is for modelling and additional analysis: it is a highly cost effective way of getting more out of the data.

Once data has been distilled it also more readily transferable into a format for easy dissemination. We often develop bespoke web-based spreadsheet tools which allow internal teams to cost effectively undertake their own ‘what if’ analysis on the data.

Revisiting and reanalysing previous studies is almost always overlooked when a new project is being considered. We are increasingly commissioned to undertake analysis programmes that are involved with reviewing and ‘knitting together’ the strategic messages from previous research. Not only does this yield important information previously overlooked, but also helps in determining best practice across a range of projects.

4. Leverage from context

All the practical advice in the world cannot change the fact that many professionals still do not take research seriously. This is one of the key reasons why research is not having the impact it should. So, while some businesses will adapt well to the idea of action before research and the other pragmatic approaches suggested above, most will need stronger persuasion.

We are strong believers therefore that wherever possible, research is placed into some sort of comparative context. For example, benchmarking satisfaction results against your best competitor or comparing performance on a trend basis. This makes research much more powerful in its impact.

Additionally, where these measures are ‘public’ there is likely to be much greater leverage:

Extel and Greenwich Associates, for example, produce annual performance surveys on investment banking and broking. The results of these studies directly influence salaries and bonuses in the sector and prompt a good deal of action where there is underperformance.

Unfortunately, in the professional services area there are currently very few meaningful benchmarks and most of the leverage seems to be exerted by directory ratings as opposed to wider performance measures. That notwithstanding, the principle should be to ensure that the data becomes active rather than passive.

We believe it is to the ultimate advantage of the professional services sector that there are more published performance measures. Although the natural assumption is to assume they are negative forces, we in fact believe that they will give professional firms much more ammunition to persuade their firms of the necessity for action.

Increasingly clients are demanding that their potential suppliers reveal the results of their own internal surveys to demonstrate performance and we have long been advocates of the use of such findings in pitch process.

5. Finally…write a research policy

If you want to control the proliferation of research and maintain consistent standards, create a formal research policy for your organisation. This will enable you to determine what research is conducted and to ensure that people stick to the practice & principles of good research. The policy should also refer to your own firm’s best practice so that people build on projects that were successful. It may also refer to lists of recommended agencies or individuals.

Policies will vary depending on organisation, however they should build on the key principles enumerated above and should be used as the formal framework for all research projects.

Ben Bolton is a director at Gracechurch Consulting. He can contacted at bb@grch.net.

[1]‘Backward’ Market Research Alan R. Andreason Harvard Business Review 1985 No. 85301

[2] How Surveys Influence Customers Paul M Dholakia & Vicki G. Morwitz 2002 Reprint FO2O5A