Friday, September 19, 2008

Lessons from the current financial meltdown in the US

I am a simple person but I read today an article from Zac Karabell in the National Post entitled "Why AIG Fell" and wonder what lessons our profession can take from this debarcle that has cost tax payers billions of $.

It seems that AIG had floated under the radar screen of the business media because its business model was so complex and opaque that it was impossible to describe simply! Among many of its products was insurance on derivatives built on other derivatives built on mortages (what the hell is going on when something so intangible can be sold so many times?). AIG priced those according to a computer model that no one person cold have written. When default rates and home prices moved in ways no model had predicted the whole pricing structure was thrown out of wack. It seems however the assets being insured only shifted by 10-20% but the cumulative impact has imploded many companies that have been successul for 90 plus years.

So what are the lessons for market and social research?

1. further validation that we need to shape the future not try to predict it
2. lets keep our business models simple and tangible
3. our models need to be clearly understood by users and not masked in complicated science that cannot be clearly articulated and understood by all
4. does this mean black box solutions are no longer appropriate?

Is it time for art and science to merge more closely in market and social research and how?

Wednesday, September 17, 2008

2008 AMSRS National Conference, Melbourne

I have just spent 3 days at the 2008 Australian Market and Social Research Society (AMSRS) National conference in Melbourne. It was a fansatic demonstration of old and young research professionals challenging each other, with the ultimate aim of creating a more effective product for users of research.

There were many highlights and it truly had an international flavor. A few messages really jumped out that i will not forget easily

1. We need to listen more instead of always asking in todays connected world
2. Film is the new currency
3. Measure, measure, measure
4. Lets consider culture and context more in developing research outcomes
5. Shape the future don’t rely on predicting it
6. Good insights are wasted unless you can tell a compelling story

Another observation I made is that everyone is nervous before a presentation to your peers, even the most experienced speakers.

The 2009 conference will be in Sydney in October.