Thursday, 6th September, 2007
Why fast, tactical intelligence is the tool of choice for one economic development agency - 6th September, 2007
Tourism Industry interview with Maria Peter of Scottish Development International
Think national economic development and what springs to my mind is weighty tomes of economic impact research, multipliers and market forecasts.
So it was a surprise to me that in the first five minutes of speaking to Maria Peter of Scottish Development International (SDI) she had covered off fast, tactical response to market demands; channelling intelligence gained from global operators back in to the market for use by small indigenous operators; meeting business needs with actionable research focused on provision of contacts and the benefits of fast and functional research. Impressive stuff.
SDI works with both Scottish-based and overseas companies and organisations. Their role is to broaden Scotland’s international appeal and to assist the growth of the Scottish economy, by encouraging inward investment and helping Scottish-based companies develop international trade. Tourism is major significance to Scotland, producing around £4.9 billion for the Scottish economy and supporting 9% of all full-time employment. It no surprise therefore, that tourism is one of the key sectors of interest to SDI.
One aspect of Maria’s role is to develop inward tourism investment into Scotland, in the form of real estate, resort and hotel operations to private residence clubs and timeshare development.
As Maria explains: “Five years ago Scotland was not a priority for global developers and investors, whereas as now it is, including the Highlands and Islands. Resort developers are now saying that their clientele is demanding something different, something that Scotland is able to offer. For example, there are now timeshare operators with a Mediterranean presence who tell us that their customer base is also demanding a time-share experience in the Highlands of Scotland.”
“SDI responds to the needs of potential inward investors and in turn they are responding to their customers’ demands. They can give us first hand consumer demand information, without us have to make assumptions or commission endless swathes of research that may or may not hit what the global operators are looking for. We use these intelligence channels to feed data back into Scotland, which is of critical importance, because SDI can then facilitate deals by effectively acting as matchmakers between global operators such as the Hyatts, Hiltons and Intrawests and partnering them with potential indigenous developers, landowners and investors in Scotland.”
Intelligent tourism matchmaking
With a focus that is both inward and outward, SDI is using market, business and consumer intelligence sources to look at competencies and matching them.
Market intelligence originates from the global operators and is in effect passed on to the typically small indigenous tourism businesses that work with SDI.
SDI also uses research at a global trends level, but wants to get this to the market in a form whereby businesses can actually use it. So, they are also looking at “fast and functional” tactical intelligence that will deliver a measurable return on investment for indigenous tourism businesses.
For example, they will assist business growth by helping match a tourism business in Scotland with an operator in, say, Germany. At a business level, they put their research energies into the sourcing of appropriate warm contacts, rather than necessarily solely into the provision of feasibility or global trends research.
“Its about tactical use of intelligence to help businesses position and reposition themselves and make partnerships based on contacts and business development – we put people together with the right people, which has more resonance for most businesses than abstract trends research.”
Does this mean there are no weighty economic impact studies on Maria’s desk?
She explains that within their remit there is a place for both tactical and market/economic research. “Its about what is practical and appropriate in the specific context. Economic impact research can justify investment at a national/regional level that wouldn’t necessarily be practical at a business level. It reveals where there are knock-on benefits that ripple out through a region so of course that has its place too. For example, research has been done at an economic impact level for resorts such as Gleneagles and has found the positive impact is at a high value job creation level and in terms of support for local produce. The impacts of some investment activity can be justified when viewed in terms of its wider benefits, when there may not be a case for support or investment purely at the organisation level and this is the real value of economic impact research.”
Maximising ROI from research and intelligence
So in terms of going forward what, in Maria’s view, are the ongoing research challenges? “The concern for me is to keep revisiting what we are measuring and why, to ensure we can be responsive and maximise our effectiveness both to the potential inward investors and for the indigenous businesses looking to improve their growth through international relationships.”
“The global operators have their measures, their key performance indicators etc – we need to understand those and be able to respond, but be aware that we can never second guess them. So of course, there is always the question of are we measuring the right thing? Are we making the mistake of being blinded by averages, for example in terms of occupancy rates? Do we need to do more segmentation of the data – should we only be looking at occupancy rates of specific market segments? How do we factor in the demand sustainability?”
“We’re aware that we have to keep revisiting this data and the KPIs behind it to make it meaningful, so I guess from my perspective that is the challenge. How do we use all the data we have to work smarter and more effectively, rather than necessarily harder?”
Talking to Maria about SDI’s use of research and data in terms of Scotland’s tourism development at a global level was fascinating, not least because their “fast and functional” research tactics (which I completely admire) are those I would previously have associated with private business rather than economic development agencies. And yet, I suspect that tourism practitioners and those working with research generally will recognise the fundamental challenges that Maria highlights - those of actually using data most meaningfully.
Once you have the basic what? (and the who, where, why, how and how often) then come the really hard questions: So what? and What now?
