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Should the CMO be the Chief Customer Experience Officer?

September 18, 2013 Leave a comment

This post can also be seen on Inside CXM.

Given the rapidly evolving role of the CMO, it may be a natural extension for a CMO 2.0 to assume primary responsibility for customer experience management in an organization. Before assessing the merits and cautions associated with such an expanded customer responsibility, it’s worthwhile to first understand the market and structural drivers that are causing companies to rethink how customer experience is managed and who “owns” the customer experience.

In the always on, wirelessly connected, information rich world we live in, the customer is completely in charge of who they engage with, how and when. And their expectations of how they will be served—i.e. exactly in the manner they wish or they will go elsewhere—have risen to such a level that companies have no choice but to transform their entire approach to customer experience in order to attract and retain customers. This dramatic shift of power to the consumer has significant organizational ramifications, and companies are rethinking every aspect of how they deliver an optimal customer experience, from the technology they deploy, to their culture, value systems, business process, staffing and training philosophy and practices.

One thing is clear: having a fragmented organizational approach to delivering a unified, tailored and contextual relevant customer experience won’t work. Companies need to orchestrate all customer touch points across organizational silos and find ways to deliver experiences that demonstrate a connected approach rather than a disjointed one. Keep in mind, the customer never asked for a disjointed experience; it’s just that most companies are organized along functional lines (i.e., sales, marketing, services, support, finance, etc.), so it’s naturally difficult to have a coordinated, cross-functional approach that enables the organization to holistically manage the customer experience across the entire customer journey, from pre-purchase to post-purchase.

There are various organizational approaches that companies are adopting to attempt to solve this operational dysfunction. Some companies have appointed a Chief Customer Experience Officer or a Chief Customer Officer. These executives typically have either specific organizational responsibility or operate in more of an advisory role. In the former case, the “customer experience owner” who has staffing and budgetary resources is much better equipped to drive the organizational changes required to effect meaningful change in how customer experience is managed. In the latter case, an advisory position that has the mission to drive customer centricity and optimize the customer experience, but lacks staffing and budget, will struggle to effect change even if the individual is part of the senior executive team. This may depend in a large part on the influence or personal power of the individual chartered to “own” customer experience. However, without direct control over people, budgets and systems, the gravitational pull of functional imperatives to, for example, do what’s right for sales, marketing, or service inhibits the advisory executive’s potential impact on customer experience.

What’s a company to do when there is no designated company-wide customer experience owner? It is still possible to begin the journey towards customer centricity by aligning functional objectives across two or more functions, such as sales, marketing, and services. Someone needs to at least own the cross-functional responsibility to ensure that goals and benchmarks are established, and regular measurements (such as continuous or periodic tracking) are taken to record progress against the stated objectives. In many companies, since marketing owns key elements of the customer experience (e.g., communications, Web, social media, customer loyalty programs), it is a likely group to lead the effort to align functional groups and drive initiatives to integrate customer experience management. Customer experience ownership is a journey that has to start somewhere, and it often starts with one person raising their hand to tackle the inherent structural impediments of functional organizations vs. customer -centric ones, and to drive change that improves customer experience in every interaction.

Just because marketing is now empowered if not expected to drive more of the customer experience to help support customer acquisition, expansion, loyalty and retention goals, are they necessarily best suited to become the chief customer experience officer? I believe so. As one CMO I spoke to recently put it: “I need to prescribe the ideal customer experience at every touch point—Web, call center, product, store, etc.—regardless of organizational reporting structure, so I’m providing leadership and guidance on how to drive a better customer experience, so our company can optimize every interaction.”

There are many roles other than the CMO that could assume responsibility for becoming the de facto chief customer experience officer, including the COO, head of Sales or Service. The CMO, however, is in the best position to take on this responsibility due to the increasing influence they have on the entire customer experience across all touch points. So CMO, the opportunity awaits you and the question is, are you ready to take it on?

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Categories: CMO, leadership, Organization

The Evolving Role of the CMO – Part II

This post can also be seen on 1to1 Media.

Part two of an ongoing series in which Pegasystems CMO Grant Johnson sits down with other CMOs and Industry experts to talk about burning issues that are top of mind for B2B and B2C marketers.

In the first part of this series published on February 8 I covered three of six key elements that define the new CMO. In this second part, I delve into the other three: achieving alignment, becoming a business partner, and being customer driven. As before, I include insights from three CMO thought leaders on what it takes to succeed in an increasingly digital world: David Cooperstein, vice president, CMO Practice Director, Forrester Research; John Ellett, CEO of nFusion and author of The CMO Manifesto; and John Neeson, managing director and co-founder, Sirius Decisions.

 

Achieving Alignment

Alignment used to mean that the CMO needed to inform sales on what new products or services were about to be announced, and what new marketing campaigns would be running in the quarter. We could approach alignment in a siloed fashion, seeking it where needed, such as for budget approval for major expenses, and avoiding it where unnecessary, such as testing messaging to increase response rates. It’s a lot different nowadays. Today, as John Ellett states, alignment means, “getting the rest of the C-suite unified around a central strategy. It’s about aligning sales, customer service, operations, and support around delivering a superior customer experience across every touch point.”

As CMOs, we are expected to contribute to the shape and trajectory of the business and bring ideas, energy, and inspiration about how to grow more profitably and compete more effectively. It takes a lot more effort and cycles to drive companywide alignment than functional alignment, especially when any significant change is contemplated. It also takes someone with more business savvy (i.e. typically an MBA or advanced degree is required) than marketing may have been expected to possess in the past. It also takes a lot more gravitas today, both in and outside of the boardroom. As David Cooperstein says, today’s CMOs have to “earn the right to the C&O (chief and officer), and not just the ‘M’ part of our titles.”

It’s about achieving alignment as well as sustaining it. With increasingly dynamic markets and competitive pressures, it’s easy for an agreed-upon strategy to be compromised, so refining and re-aligning are required more frequently. Plus, CMOs must continually demonstrate not only well-conceived strategies, but also deliver consistent, predictable results. In a 2012 Sirius Decisions marketing survey, John Neeson found, not surprisingly, “that the top challenge was demonstrating marketing ROI.” CMOs are more accountable than ever and also better equipped, with proper executive alignment, to demonstrate the value that marketing delivers.

 

Business Partner

In order to fully achieve alignment, a CMO must be adept and proficient at becoming a full-fledged business partner. While the opportunity to impact business results has increased for CMOs, the expectations have also risen commensurately. As Cooperstein says, the CEO now expects the CMO “to tell them about the things that are coming down the pike and bring new ideas forward,” so they can better navigate fast-changing global markets and seize opportunities more rapidly, and to have “a constant pulse on the customer to gauge how they are reacting or changing, and what that means for the business.”

The CMO is uniquely qualified to optimize the customer experience, but to do so successfully requires substantive insight into customers to fully understand their preferences, predict their behaviors, and drive measurable outcomes to marketing initiatives.

In the past, marketing could sometimes speak in a slightly different language, just as engineering might have. Today, however, as Ellett believes, “the biggest thing that a CMO can do is to talk to what they do in the language of business results. They need to connect marketing language and programs to key corporate objectives and priorities.” They also need to spend more time in crafting, articulating, and refining strategy to be the business partner that others in the C-suite now expect. Neeson believes that the tide has shifted and more CMOs are coming to the table with “very good business skills and a more pragmatic view,” which is a lot different than when their role and scope was narrower.

He believes that the “CMO comes to this role because it’s the one place where you can touch every part of the business. You can change market perception, your business, and have an incredibly positive impact on the longevity of the business and really move the needle more than in any other place.”

CMOs also have to have complete command of the metrics that drive success for both the marketing organization and the business. They have to have facts and figures at the ready on every aspect of what they do, from cost per lead and relative program success to customer engagement levels and website effectiveness—all to instill confidence and demonstrate marketing ROI.

 

Customer Driven

As I’ve alluded to earlier, being connected to the customer is more critical than ever for today’s CMOs. As Cooperstein says, “the roles of marketing have been revised, and CMOs are much more customer focused than before. How customers consume messages is being considered more significantly now. It makes the role a lot more fun if you are customer driven, but not so much fun if you aren’t.” In mostly all companies, the CMO does not have direct control over the entire customer experience, but he or she must somehow understand every contact the customer and company have with each other and drive, or at least influence, how to shape and orchestrate the right experience at every moment.

Marketing has traditionally led cross-functional strategies and tactics around the customer lifecycle, from contact to acquisition and from cross-sell to retention. But leading an organizational shift to become truly customer driven is a much bigger undertaking, and one that requires both fortitude and stamina. But there’s no going back. In the Web 2.0 world, customer experience and loyalty have become the key differentiators between leaders and laggards. While the importance of delivering great experiences for customers is generally understood by most companies, executing well (and consistently) across all customer touchpoints remains a challenge and thus an opportunity for CMOs to make a major difference.

In today’s so-called customer-driven era, many companies are approaching this shift to a more empowered customer by driving greater integration in customer management across functions and systems. The CMO is naturally one of the primary executives that companies are asking to orchestrate a cross-functional, strategic initiative to enhance customer lifetime value and operational efficiencies across many functional areas, including sales, marketing, service, and support. Without appropriate department, process, and systems linkage, however, the impact will be diminished, so taking on this critical leadership role is no small task for CMOs. But that’s precisely why we are all evolving; figuring out how to increase our contribution to the business, what to do differently, what to discard, and what to amplify is what makes this role intellectually challenging and rewarding, both on a daily basis and over the long term.

Are You a CMO 2.0?

October 5, 2012 1 comment

Over the past few years, I’ve connected with  dozens of CMOs via peer groups, such as The CMO CouncilThe CMO Club and Forrester’s CMO Group, and everyone I talk to is striving to become more “2.0.”   So what does it really mean to be CMO 2.0?

Conventional wisdom says that you have to embrace the mega trends, including big data, cloud, mobile, and social.  You need to immerse yourself into the new ways of pervasive computing and continuous communications that Generation C – or the connected generation – view as a way of life.  You need to be on Facebook, LinkedIn, Twitter, YouTube, etc.   You need to meld traditional competencies in communications and creative ideation with quantitative analysis and insight-producing analytics. But, while all this is true, it overlooks the change in operational approach and style that is equally important for a CMO 2.0.

Just because a CMO is in the “C-Suite” doesn’t mean he or she will be more successful at influencing peers than VPs of Marketing who are not part of the most senior executive group.   Success requires a commitment to building and maintaining strong ties to other C-Suite members, so you can count on their support for strategic initiatives.   As John Ellett, CEO of nFusion and Forbes blogger, said in a recent blog: “I found that effective marketing change agents take time early in their tenure to forge strong relationships with their C-suite peers. They don’t wait until they unveil their strategy and hope to build alliances at that time; they seek out their peers and develop the trust needed before it’s time to align on a plan for change.”  Leading change is a key success factor for CMOs, so this advice is critical to maximize the probability of success of any key initiative.

Another key dimension of being a CMO 2.0 is the ability to not only learn about and embrace mega trends, but also to determine how these trends are affecting your business, and how to use them as a catalyst to drive growth and revenue. Best-selling author and technology guru Geoffrey Moore definitely gets CMO 2.0.  In his talks about the future of IT, he articulates how systems of engagement are replacing systems of record, so that we are moving from an era of: command and control to collaboration; from transaction-oriented to interaction-oriented; from data-centric to user-experience centric; and from user learns system to system learns user.

To be CMO 2.0, you have to not only drive marketing, but also drive change in the systems the company uses to connect with and engage customers, and continually revise the policies and processes that govern all customer interactions, whether or not you have authority over these functions (e.g. sales, service, support) that touch customers.

Many observers have said that the CMO 2.0 is ideally suited to take on additional responsibility and have an increased impact on organizational success.  But this won’t happen by simply synthesizing the mega trends – it requires a deeper insight into what to do about them and the formulation of a transformative plan to drive organizational change.  In his recent book “Everywhere”, Larry Weber, Chairman of W2 Group and Pega board member, explains that you can’t just say your company is going to embrace social media, you actually have to change the company at the core:  “To develop a social enterprise, management has to be intentional about creating a culture that values openness, transparency, collaboration and innovation. Although many social forces are making this directional move inevitable, it often goes against the grain of how companies have traditionally been run.”  To be CMO 2.0, you therefore have to be just as involved in culture building and culture change as the head of HR and the CEO are.

So it’s clear that while embracing Web 2.0 technologies and understanding mega trends and their implications is important, it’s what you can do about this unrelenting wave of change to reshape your company and its operational parameters that will ultimately determine whether you are truly a CMO 2.0.

Customer Acquisition and Expansion in the Resurgent Economy

A recent CMO Club Summit in New York City gave me and a colleague a great opportunity to talk about a topic that’s top of mind for both of us and no doubt many others in the resurgent economy: customer acquisition, retention and expansion.

That’s why at each of our respective organizations, we’ve moved up the bar by creating and expanding key activities that support all aspects of sales, from lead qualification through close. At both Pega and Kofax, our marketing teams work closely with sales teams at several stages of the buying cycle. Investments, program priorities and nurturing and pipeline acceleration tactics are key aspects of this overall revenue generation team alignment.

At Pega, we’re constantly engaging in targeted campaigns that get the ball rolling – driving prospects, existing customers, etc., to our web site and communities to share meaningful content. Client success spawns increased public awareness. We’ve seen this happen firsthand with our clients such as Farmers and Medco, among others. Due primarily to our target account sales model aimed at predominantly large, internationally-known companies considered to be among the best in their respective industries, we do not attempt to drive transactional demand generation activities for our high-value products. Rather, we look to engage and activate prospects to ensure they are engaged throughout the buying cycle in a thought-provoking way.   We call this process the customer journey. Sales and marketing co-own how we facilitate this, which includes getting customers predisposed to our offerings and ultimately choosing us over other alternatives.

One event that has consistently enabled Pega to have such great success with customers and other areas is our annual user conference, which also doubles as a major customer training event and gathering of thought leaders. This year, we’re looking forward to PegaWORLD – and are confident it will increase customer interest in additional products and services, as it has in the past.

Building High Performance Marketing Teams with Customers Top of Mind

In today’s competitive software industry, it’s crucial to have a high-performing marketing team in place that’s focused on customers. As a seasoned veteran who has led marketing organizations of all sizes, I can’t emphasize this enough. Organizations which underestimate the importance of customer focus, and fail to allocate adequate resources to the cause, do so at their own detriment.

There are a handful of key marketing behaviors which maximize individual and collective contributions and ensure continuous improvement to marketing efficiency. Core competencies such as leadership, teamwork, initiative and communication top most lists. But perhaps even more important is something that you might not hear mentioned often enough in some company circles: customer focus.

Making customers and their short-term and long-term needs a primary focus of one’s investments and actions is critical to successful marketing organizations (and companies for that matter). Thinking and obsessing about, contacting and connecting with – whether in person or via social forums and communities – and “blueprinting” the value you deliver, the problems you solve, the difference you make, is essential to efficiently capturing, nurturing, and growing your customer base.

To say we have made customers a primary focus at Pega would be an understatement. Customer success is in our mission statement; it’s a fundamental belief and unwavering commitment. To continually hit on this objective, we have aligned numerous company and marketing goals to this overall charge, including some of my own personal 2011 goals. Similar to the transformational approach we take with our technology, we are constantly leveraging best practices and adapting processes to improve our effectiveness and efficiency when it comes to customers.

Launching our customer success program and undergoing a revamp of our web site that includes better highlighting of our many customer successes and all other pages are just a few examples of what we are doing to recognize and reward our customers. There will undoubtedly be many more examples as the year progresses, including PegaWORLD, our user conference taking place on June 5, which this year is themed “Driving Customer Success,” and will feature more than 30 customers sharing their success for an expected 1,600 attendees.

The #1 Success Factor for CMOs: Leading Change

October 7, 2009 2 comments

This past spring, the CMO Council issued a press release about the “DNA of a CMO, “stating: “among the most essential qualities, a CMO must be: a visionary & thought leader; a strong business driver; able to secure executive support & foster cross functional relationships; customer centric; competitive strategy guru; and a brand advocate & champion.”

These attributes make sense, but the ability to “secure executive support” doesn’t quite capture the hardest, and most essential, quality and success factor I’ve seen for CMOs (at least in technology companies where’s I’ve spent the past two decades). That quality is the ability to lead successful change initiatives, especially on a global basis. I’ve seen others fail when, upon achieving executive support for a change initiative, the CMO thought that hard work was done.

Having led global brand building change initiatives at AST Computer in the 1990’s and FileNet earlier this decade, I’m certain neither brand development initiative would have been nearly as successful had my team and I not secured cross-functional, cross-divisional and cross-regional (i.e. EMEA and APAC) buy in and participation. The easy way could have been to dictate the key change, given both companies were led by strong-minded CEO’s, but simply stating strategic intent is not the same as implementation and ensuring consistency of execution.

Russell Reynold’s published a white paper a couple of years ago on “The Successful CMO” which listed personal competencies that a CMO must possess to succeed: “leadership skills; strategic perspective; adaptability; and flexibility and backbone.” I found these last two attributes, flexibility and backbone, crucial to driving successful change. Having the courage of one’s convictions is key, along with fact-based evidence (e.g. customer input) as supporting rationale. However, as I’ve learned, flexibility is just as important. Trying to drive change down a straight track (“do it because I’m in charge”) can be the fastest way to derailment of key change initiatives. Flexibility to accommodate different organizational, personal, regional and cultural perspectives is key to successful and lasting change.

Recently, John Ellett, co-founder and CEO of nFusion Group , blogged on key trends to consider in 2010 planning: “Change will be imperative: Whether it is competitive position or media mix, the status quo won’t be acceptable. Successful CMOs will be the change agents for their companies. So trend #1 will be an increase in structured change initiatives led by marketers. (blog: http://marketing-has-changed.com/five-trends-that-will-shape-marketing-plans-in-2010/)

The key corollary to successful marketing change initiatives at technology companies is the art of leading change in organizations dominated by left-brained engineers — but that’s a story for another blog.