The absurdity of a year plan
Pretty soon all marketing managers can draw up their year plans and budgets for 2013. It will be busy times! However I am more and more convinced that we should walk away from the traditional marketing planning.
I am certain that speed and flexibility are characteristics of modern companies. Unfortunately speed is often interpreted incorrectly. A company which builds a Twitter helpdesk is currently considered to be a flexible and quick company. In fact that is not correct. Reacting quickly to a tweet is not sufficient for being a quick and flexible company. Reacting quickly to consumers’ tweets and blogs is of course part of the game, but it’s the easy part. The hard part is to make your company flexible so that it rapidly responds to the correct trends. Furthermore you need to reduce the duration of your production processes. A customer giving feedback about a product wants more than a mere â€˜thank you for the feedback’ tweet. That customer wants to see the product adapted. He also wants to see the results after a few weeks, not after 6 months. To do so, your company, no matter how large, needs to have the spirit of a small company.
The speed of change increases year after year. In the past five years new technologies strongly influenced the consumers’ behaviour. The arrival of the smartphone and the tablet brings a new wind to this evolution. In order to become flexible and quick, it is handy to invest in certain micro-trends. Even if a new trend does not seem to fit with your company straight away, you should still investigate what it implies exactly. By reacting rapidly and taking the main micro-trends seriously, you will never miss an important evolution. Of course this does not imply having to adapt your entire company to every single new trend. The main thing is to learn, to experiment and to see in what direction the world is evolving.
In this context the classic year planning does not make sense. Making a planning in October for the next 14 months automatically entails a lack of flexibility.
Why do companies not draw up a planning per quarter, per month, per week or in some cases even per day? Doing a budget and planning check only once a year means your company has to respect it. The future changes so rapidly that a year planning makes your company sluggish. Real-time feedback forces you to take real-time action. But you need a sufficient level of flexibility for this. Drawing up a budget, planning and actions per quarter will automatically make you a lot more flexible.
Maybe we should dare to take it one step further. Why do companies not make their entire marketing budget flexible? You determine a vision and a direction. You estimate the budget you may need, but the specific realisation of the plans is not determined in advance. In my book ‘The Conversation Manager’ I suggest a marketing budget which is 20% flexible. Since then I have realised that 20% is insufficient. Furthermore this buffer is the first to be eliminated in times of savings. And that implies that the objective in view, flexibility, is not reached. That is why I am now making a more extreme suggestion: make your entire marketing budget flexible.