What will research departments look like in the future? This is the question I walked away with after attending this year’s Corporate Researchers Conference (CRC). The keynotes, conversations, and presentations signaled a common theme: the ways in which researchers and their companies are transforming are vastly different from one another.
Universal Forces of Transformation
Transformation is quite hard to define. I know because I chaired the transformation track at this conference! Upon opening the track, I called attention to the four universal forces of transformation, which are:
- Technology: Big Data and Artificial Intelligence
- Climate/Resources: Climate change, natural disasters and relief efforts
- Economic Power: Connected free markets
These forces are fueled by vast quantities of available data. This means that transformation is constant, and while data may help researchers and businesses make more informed decisions, it doesn’t eliminate the need for customer and employee research.
One of the key themes in the conference was an acknowledgment that transformation is happening everywhere, and the customer is at the center. The keynotes underscored this quite well, approaching the idea of customer centricity in various ways.
Two key subjects stood out:
Memorable Customer Experiences
In his keynote, Dan Heath, bestselling author of Switch and Made to Stick, discussed the power of moments. He described the systematic way to create unforgettable moments. Through his research with Southwest Airlines, he found that approximately 2% of flight attendants will deviate from the typical boarding announcements in favor of a performance, such as a song, joke or dance. A great example of this can be seen in this video.
Dan and the Southwest team discovered that encouraging flight attendants to deviate created a memorable moment that increased the likelihood of passengers to consider Southwest for subsequent flights. By increasing the number of flight attendant performances, Southwest could actually increase their bookings.
Nudge Me to the Oyster Bar
The other memorable keynote presentation was Ravi Dhar’s discussion on an agile insights framework he developed at Yale. The framework is based on the nudge theory, popularized by recent Nobel Prize winner, Richard Thaler.
The framework is meant to address three key challenges:
- Surveys alone are insufficient at measuring behavior
- Stated preferences downplay salient goals and emotions
- Choice overload can undermine intent
Using a system 1 approach to messaging and choice architecture, the framework has proven to effectively “nudge” customer behavior to the desired outcome. Successful implementations of nudge theory include Netflix, whose utilization of such is the reason why the next episode of your favorite series automatically plays after the one you just watched.
A Tale of Two Research Departments
The keynote speakers all seemed to agree that customer centricity is paramount to future business. After listening to researchers from Google and Facebook, it became clear that some companies are simply better equipped, by design, to put customers at the center of their business. One panel discussion focused on the organizational structure of the Facebook and Google research teams, along with some of the challenges they face. Facebook has a more centralized research team, while Google’s is more decentralized. For all their dissimilarity, what struck me was that these two companies are redefining the traditional approach to launching features and products. Both companies are constantly testing different iterations of their products with their respective user bases. Facebook acknowledged that at any given time, there are 100+ different versions of a given platform being tested in live environments with users. Facebook (and many others) also conduct regular experimental designs with their user base.
The Full Stack Researcher
Research departments will continue to transform as organizations shift toward full customer centricity. There is no wrong way to organize research teams of the future, as long as they are set up in ways that complement business needs and have a direct line to the customer. AirBnB, Facebook, and Google have all deliberately set up their businesses to collect, measure and analyze customers at a speed and scale that was previously hard to achieve. It’s this deliberate customer-centric design that has had a significant impact on how research departments are structured and is an insightful glimpse into the future of our industry.