Mal's musings: A new theory about business theory
We need good theories to make the practice of pharma sales and marketing work.
By on Aug 15, 2010We need good theories to make the practice of pharma sales and marketing work.
There are few things as practical and tangible as business.
Practitioners see theory as concept development by those not ready to face up to the rigor of the real world.
The tough environment of making a business work effectively requires pragmatic and hands on action, does it not?
It is difficult to argue with the need for action and pragmatism, but there are misconceptions in common views about the role of theory in running a successful business.
The word theory has a negative perception among many practitioners.
You often hear comments like, That works in theory but not in practice, or That is textbook marketing; come into the real world.
As a result of this commonly held view about theory, many business professionals align themselves with practice.
Practitioners feel safer in the notion that they are making things happen by doing rather than theorizing.
In truth, we are missing the point concerning theory.
What is a theory? Is it an excuse to talk and write rather than do?
Is it a poor explanation of a situation, relationship, or dynamics?
Or is it what whacky academics come up with to keep themselves amused?
None of the above is correct.
Theory is simply a substantiated explanation of a phenomenon.
Life, like business, is full of complexities. Sometimes, input and output is clear but inability to understand how and why limits our ability to adapt and replicate.
Can you imagine the products that the industry produces without sound theory?
Scientists embrace and leverage theory since it illuminates understanding about biochemistry; engineers use theory to explain motion, energy, and light.
So, is there room for theory in business? Absolutely.
There are many well-established theories that are well accepted and practiced, but unfortunately those who practice them have forgotten the roots of these principles.
Team building, motivation, customer satisfaction, and sales are all areas that have benefited from strong theories.
This makes it all the more surprising that theory has such a bad reputation among business professionals.
We must remember that theory is an explanation of a phenomenon.
For example, team development theory helps us understand the stages a team goes through before it reaches optimal performance.
As a result of the insight the theory gives us, we can take action to manage through the stages with minimum obstacles.
However, that is an explanation of a good theory that provides genuine illumination and has been proven.
Random guesses and bad explanations of dynamics are bad theories, and often it is confusion between good theories and bad theories that tempts business executives to throw the baby out with the bath water.
We need good theories. Otherwise, we will act on instinct and experience, which makes replication difficult if there is a lack of explanation.
Understanding why an apple falls from a tree led to
Similarly, in business, understanding customers has led to good theories like targeting, value chains, and branding.
As our environment grows in complexity, we need to get better at adapting and implementing good theories.