It was late afternoon in Moscow when Yevgeny Primakov, who had just been chosen as Russia's next prime minister, began announcing the makeup of his new, conservative government that seemed likely to turn away from the free-market doctrines of the post-Soviet era. Weeks of nervous expectation in executive suites and political circles around the world had been hanging on this moment.
In the midst of a Russian financial crisis that was threatening to unravel several years of Western-backed economic reform, many executives wondered: What might this latest development mean for global businesses?William S. Tiffany, then vice president for strategic and business planning at Caltex Petroleum Corp., arrived at corporate headquarters in Irving, Texas, at about 8 a.m., two hours after the announcements in Moscow. Twenty minutes later, an international operator brought Tiffany into a conference call from Oxford, England, where a panel of three experts began briefing more than 75 executives around the world on the turmoil in Russia. Bankers asked about exchange rates and financial stability; multinational manufacturers wondered about a possible collapse of production. Caltex subscribes to the Oxford Analytica Ltd.'s consulting service that hosted the call, and Tiffany listened for any word that Russia's economic malaise could infect the Pacific Rim nations where Caltex does much of its business.
It seems unlikely that any of the executives who listened and questioned the experts from Oxford that morning would make a strategic decision based only on that 90-minute call. But it is clear, considering the premium most executives put on their time, that these businesspeople attached a high value to this new and unfamiliar format for receiving real-time intelligence. It is now part of their growing battery of information-gathering techniques. Their problem, and almost certainly yours as well, is time and selection. What sources do you have time for today? Or this week? Or this month? And how do you know which will prove most fruitful?Whether their market is the Midwest or the Middle East, CEOs and other executives must keep up with a daunting range of business issues that multiply as the world economy becomes ever more interconnected. The next critical piece of information could take any form-an evolving social trend affecting customer preferences, a new management practice, a nascent technology or a political or economic development in a remote manufacturing location.
Besides this multitude of issues to monitor, executives enjoy an embarrassment of riches in information options. Recent conversations about this knowledge management challenge with senior executives representing a broad range of industries-from midsize companies to Fortune 500 corporations-made it clear that successful information hunting requires a varied approach.
Spanning the Globe
"Half of my time is spent trying to understand the world situation," says Tiffany, who (before he left Caltex when the company moved to Hong Kong at the end of 1998) cast his information net as wide as the three-continent spread of his oil company's market. Caltex's own international network of contacts, developed over 70 years, is perhaps its greatest asset in that information quest. "The general feeling among senior management is there's no substitute for onsite travel," says Tiffany. "It's an expensive proposition with our headquarters in Texas, but most people find that's the best way to interpret what's going on."Caltex's executives can drop in to a country in, say, East Africa, and get access to top business and political sources because of the (sometimes unusual) groundwork laid by Caltex country managers. "My last overseas posting was in the Philippines. I was on the school board, museum board, ballet board...obviously for personal interest. But it also enables you to interact with community leaders," he says. Such informal contacts are critical to gauge trends such as the Philippines' long march toward deregulation of the oil industry. Industry competitors may be unlikely to share much with one another, but executives from other multinational industries can become good sources of information about the country's political and economic outlook.
In-country visits can be more formal, too. When critical decisions have to be made at Caltex, top management from headquarters travel to the nation in question and make the rounds, sometimes including a meeting with the country's president as necessary. This practice holds across industries, of course. Lee M. Kennedy, business planning director for International Operations at 3M Corp. in St. Paul, Minnesota, travelled to Romania in 1996 to start proceedings to set up a corporation there. Kennedy met with state department and commerce officials and Romania's ambassador to the United States.
There's a side benefit to all the globe-trotting. Kennedy, for one, has found some illuminating tidbits of information in the friendly skies. "I was getting ready to fly to Amsterdam in June on a Northwest nonstop, and sitting next to me was the head of the KLM office for Belgium and Luxembourg," he recalls. What could a technology company like 3M glean from a chat with an airline executive? One of the parameters of economic growth is airline seat occupancy, so airline executives often have a good picture of the state of the economy, he explains.
"I probably get more of those insights on airplanes than anywhere else. You get locked in an aluminium tube on the way to Amsterdam and it doesn't even have to be your seatmate [who becomes the contact]-people get rocking all around trying to make the time pass."At Your DeskNo executive can always be on the road, however. Back at his desk at Caltex each morning, Tiffany started the day with Platt's Oilgram Price Report. "It's something that's part of the daily ritual, the first cup of coffee with that yellow broadsheet, five days a week," he says. He also read Petroleum Intelligence Weekly. "They tell everyone what is happening at the same time, but it gives you a good feel for the business," Tiffany explains.
To keep senior executives aware of broader developments, he circulated Oxford Analytica's daily brief on economic and political developments worldwide. For a longer-term overview of the global economy, Caltex's chairman attends the World Economic Forum's annual meeting in Davos, Switzerland, while Tiffany attends the Forum's regional meetings in Asia and China.
Kennedy gets weekly reports and quarterly market presentations from 3M's corporate economist. And lately he's become skilled at surfing the Web. He has a number of things bookmarked, such as sites from Africa where the company hopes to expand, and the International Herald Tribune, published in Paris. "IHT is probably the closest thing I know to a global newspaper," he observes.
Kennedy includes London's Financial Times and the Pointcast Network online news page in his morning Web routine. He also finds the CIA's Publications and Handbooks site a good resource for economic statistics, maps and other information. "I can probably hit the peaks I want to hit in about 20 minutes to a half hour in the morning," Kennedy says.
Web Time, Face Time
On Wall Street, information travels faster than in most industries. And for an increasing number of financial services executives, information travels online.
Mark Adams, president and CEO of Intralinks Inc., is a classic case of the leader of a Web-based business who relies on the Web to follow his market.
Intralinks, a 2-year-old startup in New York City, provides Internet-based deal-management services for the global capital markets. "We have access to American Banker Online, which keeps us up on industry news," says Adams. Since any of Intralinks' clients could be the target of a merger or acquisition, that's critical. "I'm also a subscriber to The Wall Street Journal and The [New York] Times on the Web, which I do during the day, and I also go to MSNBC," Adams says. He's programmed American Banker's alert service to push to his desktop stories on subjects he's following.
Although his company is certainly more Web-centric than most, Adams says much of his most critical information comes from the 25 percent to 30 percent of his day that's spent talking to clients. "There's nothing better than talking to [clients such as] Bill Hartmann, a director at Citibank, to see how the market is going, how the merger is going and how it will affect our business with them."Adams and other Intralinks executives also consult with board Chairman Arthur Sculley and former Apple Computer Inc. CEO John Sculley, a member of the Intralinks Executive Advisory Council, whom they call their "built-in oracle" on the development of the Net industry.
Human interaction remains a favoured source of information with executives all over. As one might expect from the head of a public relations firm, Don Middleberg's information-gathering style is especially gregarious. "I keep saying to our people here at the office, if I see you having lunch here [in the company cafeteria] too often, something is wrong," he says. Middleberg, whose Middleberg Associates Inc. in New York City employs about 50 people, practices what he preaches. "Despite all the high tech available, I most value personal relationships. There's no substitute for friends and contacts in the business for industry scuttlebutt-who has what account, who is coming and going," he says. Face-to-face meetings outside his company absorb about half his time.
Managing the Flood from Within
The management team at Dun & Bradstreet, a provider of business credit, marketing and purchasing information headquartered in Murray Hill, New Jersey, would quite logically know a lot about information overload. As a key player in the business information industry, it has seen the sources and channels of data multiply to the point where individuals find it nearly impossible to cope alone. To manage the flood of information its own senior executives require, the company relies heavily on business intelligence gathered by its strategic planning department.
"Looking at these news wires, all kinds of odd things come through, and that's not what an executive wants to see," says John Bunyan, senior vice president for marketing at Dun & Bradstreet U.S. "The business intelligence [staff] not only gives human added-value, but it is schooled in what are the valuable issues for the company. I'll go for that over having a subscription to all these services," he says.
Bunyan is tracking the expansion of enterprise resource planning (ERP) systems into business functions such as credit, purchasing and marketing. He needs to watch this industry development as Dun & Bradstreet initiates what it hopes will be a series of technology partnerships to deliver its service via new channels including ERP. He has past experience with online services, so it would be a cinch for Bunyan to program a news filter. But according to him, it wouldn't suffice. "If you get less than 20 percent false hits, you're a skilled operator," he says. But D&B's own business intelligence unit can do better by using human "filters" that further assess the priority of the information. The company's assistant vice president for strategic planning, Bill Strugger, will personally push the results of his searches to Bunyan and other senior executives. "If it's a priority item, he's going to deliver the information. If it's high priority, he'll send an e-mail to the relevant parties directing them to read the information; and if it's higher priority than that, he will walk into the office and say there is an e-mail and you need to look," Bunyan says.
If the information is urgent and affects several areas, Strugger might send multiple voice mails and ask its recipients for comment. "Compare that prioritization with looking at relative location of words and frequency on the Net," challenges Bunyan.
At Intralinks, the Wall Street Internet company, Senior Vice President for Marketing Andra Marx manages the distribution of strategic information and breaking news to the management team. "It's my responsibility to sort through the vast amounts of information and make sure the team is alerted to things that are relevant," Marx says. She subscribes to news services and forwards e-mails to the appropriate executives. She also receives Inquisit.com's headlines of hyperlinked press releases to monitor management changes in the industry.
At his New York City PR firm, Middleberg also depends on resources from within.
"I'm looking to broaden my education," he says. "I'm a 50-plus senior executive in a firm heavily involved in high tech, so I depend on many juniors in my firm to make me smart. They can e-mail information on new Web sites, new trends, new e-zines; I depend very much on my own staff." Though he spends a few hours a week reading trade magazines, "being online and looking at sites takes at least 15 hours a week just for my own education," Middleberg says.
The Mountain to Mohammed
Leo A. Daly, the U.S.'s third-largest architecture and engineering firm, used to have a problem with its international division. With its corporate headquarters in Omaha, Neb., the global part of the business, Leo A. Daly International, felt out of the international loop. But in the early 1990s the division got into the loop in a big way-by moving to Washington, D.C. When keeping in touch with market developments is top priority, such a radical move can be justified.
"We came here because of all the contacts that are available: the World Bank, the embassies, all the international businesspeople who come to Washington.
[Being here] makes it easy to meet with them as they come to meet with President Clinton or their ambassador," says Charles D. Dalluge, president of Leo A. Daly International. "Washington, D.C., is a city where everyone is involved with government and business and trading information. Whether you're at an official breakfast or meeting with friends, the conversation is usually about business."Leo A. Daly has a good network of local contacts and offices in places such as Berlin, Hong Kong, Dubai and Madrid, where it is designing a 250,000-square-foot R&D centre for an oil and gas company. But, Dalluge says outside experts on the countries his company operates in are necessary for reality checks. "I or whoever is dealing with a project in the region can talk almost daily with locals, but sometimes they're almost too close to the situation. So to offset the firsthand information, we look at things from the standpoint of the World Economic Forum's breakout sessions in Hong Kong, Washington and Buenos Aires, which focus on a region." Dalluge says he also consults with groups such as Oxford Analytica. "There may be one group that feels strongly that something is going to happen and others say no," he explains. "We may not have an answer, but we'll end up with a better question."Better QuestionsExecutives' strategies for information gathering will be influenced by their industry and will reflect the style of each executive and his or her company's culture. But the one important mission all companies should share is to encourage outward-focused corporate leaders to develop strategies for bringing information and knowledge inside. And most of all, as Dalluge says so well, we need to talk to a wide range of rigorous sources in order to find the "better questions."(Senior Writer Gary Abramson can be reached at firstname.lastname@example.org.)SIDEBAR: Information on the InformationThe growing interdependency of markets and industries is creating a demand for more sophisticated providers of strategic information. New information services keep popping up, some geared to specific industries or regions or aspects of business. Most offer to push information to you based on your particular interests. Keeping up with these services and their offerings is a challenge, but worth the effort. Here's a quick description of a handful of such services.
Oxford Analytica Ltd.
Offers advice and analysis on economic and political conditions worldwide; delivered online, by phone, in print or in person.
World Economic Forum
Best known for its annual gathering of CEOs and political leaders in Davos, Switzerland; the forum also hosts smaller meetings on several continents and connects its members through a global virtual network.
NewsEdge, Dialog and Infobeat
These are among the many companies that filter other news providers and enable executives to receive chosen subjects by e-mail.
Its e-mail briefings and reports track and analyse the market of content delivery, both from the corporate user and seller perspective.
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