I wonder how many bad decisions were simply the result of a poor environment.
For instance, Mars Inc. infamously turned down Universal’s offer to have M&M’s be the candy of choice for the alien in the movie E.T. the Extra-Terrestrial. As a result, Universal turned to Hershey Food Corporation, who gladly offered up their previously struggling brand, Reese’s Pieces, and experienced an explosion in sales from product placement within one of the most popular movies of all time.
Legend has it that Mars was uncomfortable with being associated with aliens, and/or didn’t think much of an often upsetting tale centered on a lonely boy and his single mother. But what if Mars simply had hit its advertising budget limit for the year? Or what if, on the day Universal made their pitch, it was hot and uncomfortable, and the Mars executives were tired and impatient? The point is, it’s just as conceivable that the Mars executives decided to pass on E.T. because of a poor environment rather than other reasons.
Additionally, if you expand the definition of “poor environment,” bad data could be considered a component. For instance, regardless of what Mars thought of E.T.’s plot, product placement as a marketing strategy was still relatively untested back in 1982. Had Mars had an opportunity to test product placement on a smaller scale, it might have been more confident to go ahead with E.T. Ultimately, I contend that Mars made this bad choice at least in part because of a poor environment.
Businesses across industries still deal with similar challenges today—namely, creating the right environment that will enable the best decisions. At FICO, we consider having the right data, analytics, segmentation, test & learn processes, and measurement abilities to be the crucial components of a good environment. With those ingredients in mind, we’ve built our solutions to provide the optimal environment for optimal decisions.
One of the many industries in which we’ve proven our capabilities is automotive finance. Please take a look at the short video below, part 2 in our video series on automotive finance, to see just how we create an environment that allows our customers to learn from, act on and improve their decision making.