Source: Management Today
Date: May 2007
Chartered Management Institute Companion Lord Karan Bilimoria urges leaders to ensure constant innovation to meet customer needs

Meeting customer needs is in  many ways the essence of business - just try creating something people don't want and see how far you get! As a consumer brand, staying close to our customers is essential for Cobra Beer. It's a broad base - beer-lovers, bars and restaurants, supermarkets and shops - but it is vital for us to stay in touch, to know what is happening on the ground, and to react to the market quickly.

When I started Cobra in 1989 we began, in a sense, a step ahead, because the product itself was designed specifically to meet the needs of customers. When I was a student at Cambridge and subsequently qualifying as a chartered accountant in London, I ate frequently in Indian restaurants. The food was wonderful, but the beer left a lot to be desired. Put simply, I hated to fizzy lagers. They were too harsh and bloating, and prevented me from eating or drinking as much as I'd have liked. And I found that ales were too heavy to pair well with food.

It occurred to me then that I couldn't be the only diner feeling that way, and what's more that the restaurant owner could be selling us more food and more beer. We were both losing out.

A good busines idea is often customer-driven, deriving from the experience of being a customer yourself. With Cobra, it wasn't a eureka moment, but an idea that evolved: one day, I would bring my own beer over from India. It would be a lager and have all the refreshing qualities of a lager, but it would be smoother and less gassy, it would accompany Indian food and it would appeal to ale drinkers.

So the idea for Cobra was all about what the customer wants - in our case, a beet that pairs well with food, to the benefit of both consumer and restaurant. And this issue mostly boils down, I believe, to the old marketing language of features and benefits Your product or service can have all the bells and whistles, but it has to offer the benefits yours customers wants.

Once you've got the product right - through testing, sampling and talking to the consumer - you have to work continually to keep that customer focus. And it was here that I learned that a great business lesson from the Indian restaurant owners. We would go to the restaurants to sell, and we would suggest they try Cobra. Often, they would say: 'Sorry we don't drink'.

Two thirds of Indian restaurant owners are Bangladeshi, with the other one-third being Pakistani, Sri Lankan, Nepalese and Indian; many of them don't drink. But they they said to us: 'Look it doesn't matter that we don't drink it's our customers who matter. Leave a couple of bottles. If our regulars like it, we'll put in our first order. If our wider customers like it, we'll re-order.' They put their customers first. That's one of the most valuable lessons I've learned.

But the real challenge in being consumer-driven - beyond just responding to to the market or to competitors - is in anticipating what people will buy and what will be a success. This is one of the biggest challenges in business, and it comes down to innovation - constant, restless innovation. It means watching the competition and it means working constantly within your organisation to come up with new ideas that you can test in the market. Most importantly, it means keeping in close touch with your customers.

A work of caution here: it isn't enough just to ask your customers wht they want - you have to anticipate it. Two quotes illustrate this dilemma perfectly. Henry Ford once said 'If I had asked my customers what they wanted, they would have said: "a faster horse".' You can't just ask what they want - you have to be forward-looking and think of the products and benefits they may not even know they need. Because, as Steve Jobs, the CEO of Apple, says: 'You can't just ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new.'

That's the power of innovation - and with it goes the idea that a hundred years from now, people might look at your product and say: 'What took so long? Why didn't anybody think of that before?' When we released one of our newest products, King Cobra, it was totally different from anything else available - the world's first double-fermented lager. It has been very well received in the market, but you wonder why it took British company of Indian origin, brewing in Poland and Belgium, to come up with it.

Ultimately, what happens most is always being close to your customers and always innovating for them. Right from the earliest days, your relationship with the consumer is vital if you want to continue to offer the products or services that your customers will lvoe and that will keep your business successful.