CMOs at the top table
Jonnie AllenView bio
This article was originally published in the March edition of PM Forum magazine.
There is a famous cartoon in the construction industry that depicts swings designed by different disciplines. The architect’s swing is amazing but impractical, the engineer’s swing is over engineered, the cost manager suggests nothing can be afforded, and health and safety just have a piece of wood on the ground. The point is that all these different skills and disciplines work best when they come together to deliver success. They bring out the best in each other and temper the worst. Although the balance of skills and which discipline leads still has a bearing on the outcomes.
The leadership of a business is just the same, and between technical functions, HR, finance and operations, you tend to get very different skillsets and ideas of what is right. In the past, marketing has been left out of this leadership mix, but recently that has been changing, even in professional services.
If you think about the exclusion of marketing from the leadership of a business, it is really astonishing. You have representation with expertise on the technical side of your business, the people side (HR), and someone to tell you if you are making money or running out (finance). But even now, many businesses feel that those with the best understanding of markets and income generation (marketing), are not so important. The marketing team are the ones with a finger on the pulse of markets, client sentiment and preference. How could they not be in the most important conversations and decisions of an organisation? In excluding them, businesses are missing out on an important opportunity to fully understand their business and utilise that knowledge to grow the business further.
In professional services the challenge is to get the right technical balance. In an engineering firm, an architects practice, accountancy or law, you are selling a service and most people in the business are practitioners. In most cases the wisdom has been that you must have that discipline running the show, an attitude that “only lawyers know how to run a law firm”, for example. So, this ticks the technical box, and it has long been established that the technical heads need support from finance and HR, but marketing has often been left as a low-level function.
Earn your place
A big part of the responsibility for this lies with the marketing teams themselves. If you want a seat at the top table, you have to show that you deserve it, and for many marketing professionals this has not been an ambition, and their organisations were all the poorer for it. Many marketing teams fell into a ‘marcomms’ function, focusing more on messaging and communications than on building the full market-facing spectrum of the organisation. I feel very strongly that the first question to be asked by a marketing person or team is not, “how do I best sell this product/business/service?”, but “how do we create the best product/business/service for the market or for future markets?”. Marketing needs to be part of the core leadership discussions because it is an essential part of shaping the organisation, improving the product and creating the best possible journey for the client.
When you are junior in a business you feel it is ‘take it or leave it’. You are presented with the product or service you are selling and expected to get on with it. No room is left for those individuals to display creativity or leadership. Where marketing is at its best though, is when it works as a conduit between the market and clients and the business, enabling a better understanding of the market and how the business can serve it. The question is, how do we improve what we are doing? What more can we do to make this a success?
This is even more the case in a fast-changing world. Finance looks at what has happened and its ongoing effects, and technical teams look at how well we deliver what we produce and how we can do it better. Marketing should be working with all of these to understand what we can produce, how much it will cost, what the market needs, how much they will pay for it, and therefore where we are going. If we are not doing this then we are not doing our job.
Keep the balance
Going back to where we started, it is essential that marketing works alongside all the other disciplines and mindsets. Continuing to exclude it is a mistake that will ultimately create a dull business. In recent times, periods of global financial uncertainty has meant that the balance has tipped too much towards finance, with many businesses run by an accountant, often the former head of finance. There are still very few (especially in professional services) run by the former head of marketing.
We can use risk as a lens to look at this further. When you talk to most people about risk it is assumed that it is something to eliminate, minimise or avoid, but in reality, it needs to be understood and optimised. This does not tend to be a finance mindset but can be a marketing one. The risk management process for an organisation is about the appetite for risk and then maximising the potential that this offers.
Fundamentally action creates change and change can be mistaken for being higher risk, so leaders believe the status quo is less risky. Market research and data analytics can reinforce this if done in the wrong way. Just ask Nokia or Kodak! They were market leaders and their research showed (wrongly) that they could stay the course against smart phones and digital cameras respectively. Their position and scale both meant that they should have had a greater appetite for risk. Kodak had developed digital cameras but didn’t want to damage their core business, while Nokia had put off their move to smart phones, feeling the market was not ready for them yet. In both cases their understanding of risk, their appetite for risk and how to target specific markets stopped them from succeeding. They both saw change as the risk rather than understanding that their position gave them a larger risk appetite that they could exploit.
Is that an elephant?
And so, to the elephant in the room. All that I have said ignores the fact that while a marketing function is a modern concept, marketing skills have existed in businesses for a long time because they had a leader or leaders that played this role. Isambard Kingdom Brunel and Christopher Wren were clearly very talented work winners and self-publicists, although neither built a lasting business and Brunel needed more financial guidance to make more of his enterprises commercially successful. Even when Apple was a few people working in a garage it was clear that Steve Wozniak was head of technology and Steve Jobs was in charge of sales and marketing. Apple would not be a $3tn business it is today without Job’s skills. These people were at the top table and calling the shots, they did not have the title CMO but certainly demonstrated the desired skills.
It is clear there needs to be a balance of skills at the top level of any organisation. Within this there has to be someone speaking with the voice of the client and bringing creativity, someone with a clear eye on markets and future markets and the strategy that pulls all this together. And this is where the marketing function has to step up. The CMO has to be a business leader – not just the head of a function.