Imagine a country where its corporate leaders ignore or simply don’t know how to capitalize on one third of the country’s consumer market. Also imagine a country where the average age of the other two-thirds of the market is 47 years of age, grew only 10% in the past ten years, and whose spending in key household categories and overall market basket size declines precipitously every year they age.
As the face of the country continues to undergo a major transformation, it’s hard to imagine a single U.S. Corporation that doesn’t realize big demographic changes are afoot and have been for some time. Many also realize their companies’ survival depends on their ability to capitalize on with this younger, ever-changing and ever-growing consumer group. Yet, few companies are really undergoing the required transformation to be and remain relevant and in demand today and into the future.
The problem as I see it is three-fold:
- Some leaders simply refuse to see and respond to the changes around them; the ostrich syndrome.
- Some leaders are enlightened enough, but are unsure and sometimes powerless about what to do about an organization where its leadership, managers and employees simply don’t relate to, identify with or whose sheer ignorance renders them indifferent about the need to understand the third of the population that is different from them.
- Some leaders are stuck on personal, political, and philosophical principles about the desirability of the demographic change happening around them. But the questions must be asked: Are they being compensated to stand on principle and opinion or to grow shareholder value?
To be fair, many corporations do see the need to evolve. Most, though, have very little sense of what to do and how to go about it. Some have grown very strong on the tactics and remain very weak on corporate wide strategic integration. They use advertising and tackle some operational adjustments on a piecemeal or ad hoc basis and that’s as far as they get or as far as they can get in the absence of a business ready organization and a total market strategic approach.
As recent past president of the National Association of Hispanic MBAs (NSHMBA), my counterpart with the National Black MBA Association (MBMBA) and I witnessed corporations’ growth attempts by focusing on diversity leadership. Many were failing miserably because they tended to fall into three camps:
- They use the diversity “veil” to partner with diversity associations or contribute to non-profit “watch-dog” organizations as a way to “prove” there is an integrated total market strategy in place where there really is none. Behind the “veil,” these efforts are often about good PR and offsetting corporate affairs risks than they are about building a total market-driven growth strategy.
- Companies’ diversity directors partner with professional organizations like NSHMBA and NBMBA for exposure and to offer job opportunities. But, they’re looking for Hispanic and African American professionals with senior experience in industries which historically have had few Hispanics or African Americans in senior positions. As a result, they offer interested candidates starting positions and seldom end up hiring from this talent pool.
- Some corporations successfully attract and hire the diverse talent they seek, but without the existing cultural competency and integrated strategies in place to enable capitalizing on the new hires’ diversity, culture, approaches, the differences for which they were hired and resulting potential contributions, they go about training the employee to align their thinking to the existing corporate culture. A true diversity HR strategy enhances its company’s cultural competency only by enabling differences, the resulting creativity and innovation, and the hired business acumen to impact the total business positively.
The big questions are how does a company overcome these hurdles? How do they create an awakening to the reality of what’s in the way of total company’s growth, including personal and professional evolution as big picture leaders and visionaries?
Building total company competencies and capabilities to capitalize on today’s total consumer market is a challenging undertaking to be sure. But, if business growth is what a company is after, it is an imperative that cannot be ignored. It’s simply impossible to win and work towards growing profit and shareholder value when operating with a significant organizational and cultural handicap and misalignment with today’s consumer landscape.
The first step is introducing the questions. Considering what you have just read, is your company business ready and culturally competent to capitalize on the total marketplace? Or, is it still struggling and just going through the motions?
Terry Soto is President and CEO of About Marketing Solutions, Inc., a Burbank, California-based strategy consulting firm that specializes in the U.S. Hispanic market. Author of Marketing to Hispanics: A Strategic Approach to Assessing and Planning Your Initiative and co-author of Grow with America: Best Practices in Ethnic Marketing and Merchandising. Terry's consulting expertise spans a broad range of industries including such companies as Wells Fargo Bank, Cigna Health Care, Coca Cola, Kraft Foods, Walgreens, Disney Consumer Products, United States Postal Service, Verizon Wireless, Autozone, and Absolut Vodka.