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 / Winter 2003 / Issue 33(originally published by Booz & Company)


What Strategists Can Learn from Sartre

In an uncertain world where competitive advantage is insecure, setting strategy must become an existential exercise.

Photograph by Fredrik Broden
I remember the day I realized the world was getting weird — so strange and unpredictable that conventional approaches to market forecasting would not work. It was an otherwise ordinary day in May 1985. I was part of a team at SRI International (formerly Stanford Research Institute) that was analyzing the results of a national survey of American customer attitudes. Our program was called Values and Lifestyles (VALS), and it was a well-regarded, innovative breakdown of the purchasing public into nine different lifestyles roughly based on Abraham Maslow’s hierarchy of needs: people whose lives revolved around survival, belonging, achieving, the search for peak experience, and so on.

With the help of Simmons Market Research, we had correlated different purchasing patterns with the different lifestyles. To date, VALS had been a sustained success. If suburban women between the ages of 25 and 45 driving minivans reliably and regularly chose Caffeine Free Diet Coke over Classic, whereas young males between 15 and 25 reliably went for the sugar and caffeine jolt, then the marketers at Coca-Cola would know how to spin the ads they put on MTV differently from the ads they placed on Lifetime. The theory and practice of market segmentation had been evolving for 20 years. In fact, it had been growing hand in hand with the U.S. economy as it made the transition from mass manufacturing for a mass market during the middle of the 20th century toward a more segmented market that could be described by our nine lifestyle types — nay, even, stereotypes.

On that day in May 1985, however, I realized that the VALS system was losing its predictive power. People were no longer behaving true to type. Women were shopping at Bloomingdale’s one day, Wal-Mart the next. The segment we called Achievers started behaving like Experientials. Some men were behaving like bankers by day, punkers by night. This was bad news for clients who were trying to use market segmentation to target the different stereotypes. But it was good news for the human spirit, because what this tendency amounted to was human freedom flexing her muscles. People were behaving less predictably. They were defying stereotypes.

The Unpredictable Economy
Because I had been trained as a philosopher, I immediately knew what was happening. American customers, without direct influence from the likes of Jean-Paul Sartre or Martin Heidegger, had nonetheless discovered existential freedom. They would no longer be predictable. And indeed, customers around the world have been unpredictable ever since. No general system of market segmentation or analysis has managed to capture their patterns of behavior in any reliable way.

This realization has implications that far transcend marketing, which, typically, commences once a company has identified a strategy and developed products or services for a defined customer base. For corporations, keeping up with customers who are less predictable than consumers of old requires a capacity for innovation. Where the old economy relied on mass production to meet universal needs, the new economy demands customized innovation to satisfy an endless range of wants and whims.

The old production economy was predictable because it operated in the realm of necessity; it produced goods and services people needed, and those were relatively stable. The new economy plays in the realm of freedom; it produces goods and services for a customer who is not bound by needs. The old economy called for strategies built by engineers who could calculate according to necessary laws. The new economy calls for strategies created by existentialists who understand freedom. Most important of all, the old economy operated at a regular pace, in the clockwork time of industrial production. The new economy lurches forward and backward, in some new kind of time that was anticipated, once again, by the existential philosophers.

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  1. Stuart Crainer, “The Days of Futurists Past,” s+b, Third Quarter 2000; Click here.
  2. David K. Hurst, “Learning from the Links: What Systems Thinking Teaches about Golf and Management,” s+b, Fourth Quarter 2000; Click here.
  3. Art Kleiner, “The Man Who Saw the Future,” s+b, Spring 2003; Click here.
  4. Randall Rothenberg, “Arie de Geus: The Thought Leader Interview,” s+b, Second Quarter 2001; Click here.
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