Advice to CMOs: Have Your Metrics in Place; Have a Strategic Vision; and Work Well With Others

I was at lunch with the chief marketing officer of a major travel and entertainment company recently. Her senior team members were there, as well. They were at a fairly typical juncture for many companies today. They were seeking our advice on what other companies in their situation are doing, what options they ought to explore and what their priorities ought to be. There were points in that conversation that may apply to you.

This particular CMO has been in the job for a year, which she jokingly reminded us is beyond the halfway point for most CMOs in their jobs, given that the average tenure is less than two years. She had come from a marketing-driven company to an operationally focused company that wants to become more customer-centric. Her new company is trying to make marketing more of a strategic function that sets direction and vision but also works more seamlessly and effectively with other functions, particularly operations and IT. She has a great relationship with her boss, the COO/president, as well as her peers.

She has a great many challenges, including branding, customer segmentation and targeting priorities, online-offline channel integration, serving the wholesale organization (which sells to travel agents) and the direct-to-consumer organization. The list goes on.

As I told her, the first priority at a time of such change (and most marketing departments are evolving rapidly) should be to paint a persuasive, future vision of the company and what being customer-centered really means at different levels of the organization. How would the company do business differently? What things would different departments stop doing? What new programs have to be launched, and what skills have to be learned to get there?

Metrics
She and her managers do not have a clear understanding of what is working and what is not because they do not have clear metrics with links to the company's strategic, operational and financial goals. This makes it hard to communicate vision, determine priorities and justify the budgets needed to shift the orientation of the company toward a more customer-centered business model. To solve this issue, it is important for the executives to figure out what metrics were needed and see if they can go back and get historical performance numbers and set benchmarks—and targets for the future.

This needs to be done with caution. In companies that have not historically held marketing accountable to specific metrics, highlighting them can be a double-edged sword. You have to be prepared to make the hard decisions that the data will drive you to make.

In the midst of this already formidable challenge, she has a vexing issue to deal with. A couple of years ago, management decided that it needed to "implement" CRM. There was a flurry of activity around CRM and a great deal of buzz in top management ranks, and then the "CRM Project" was launched. Of course, as often happens, once top management funded the project, IT went and bought a CRM package and set about implementing it: consolidating customer data sources, putting in applications, building data marts, etc.

The effort was nominally overseen by sales but primarily IT driven. It was decided that marketing would be one of the first areas that would "use" CRM. Two years later, the project is over budget and behind schedule. IT would like to deliver the bare minimum and move on to other projects. As the train heads toward the predictable wreck, marketing is being held culpable for a disaster it had no control over. Worse still, marketing may end up losing its old capabilities without having new systems that replace the old functions.

This is not an atypical situation for marketing executives to find themselves in. In this case, most of the managers are trying to ignore the problem, hoping it will either go away or will be blamed on IT. The right approach is to make the business impact of the lack of marketing functionality clear to IT and negotiate a way to fix the problem, perhaps through selective outsourcing or by rebuilding a smaller system with the basic necessary functionality. If needed, both marketing and IT should be prepared to go to top management and ask for fresh funding with a revised business case, without finger-pointing. Hard to do. But no one wins the blame game, and marketing usually comes off looking worse than IT, so best to work with them than against them.

CMOs are being challenged as never before. Your world is becoming more complex and you are more interdependent with the rest of the organization. This calls for clear communication, transparent, interlocking processes, well-defined measures, people with new skills and great agility.

The good news is that marketing is playing an increasingly vital role in most organizations and gaining higher levels of recognition. For those who are up to this challenge, life has never been better. I hope you can say that about your role as you journey through 2007.