How to Be a More Coherent Marketer
A
recent survey highlights the challenges facing today’s marketing organizations,
and reveals a path to differentiation.
The dramatic evolution of technology
has fundamentally altered the way consumers approach buying decisions. Thanks
to the Internet and mobile technology, they can make a purchase anytime,
anywhere. The proliferation of buying channels is also enabling marketers to
interact with consumers and businesses in ways that weren’t possible before.
And because they have access to more and more data about consumers’ habits and
preferences, marketers can tailor these interactions to maximize their impact.
Yet according to a recent
multi-industry survey of 350 marketing professionals conducted by Booz &
Company, Korn/Ferry International, and the Association of National Advertisers,
many marketers are struggling to manage these powerful societal and
technological trends. Their survey answers highlight the significant pressures
that marketing organizations now face: They are being asked to do more to drive
growth, with the same or fewer resources, while their spending is subjected to
a new level of scrutiny. The survey also reveals that most marketers are trying
to tackle these challenges by spreading their bets across a variety of
activities, a multipronged approach that is leading to the incoherent use of
funding, talent, and other resources.
With so much in flux and so much at
stake, marketing organizations need to be strategic when it comes to managing
their resources and teams. We have identified two key priorities based on our
findings. First, marketing leaders need to narrow their focus, identifying ways
to support the few differentiated capabilities that their company as a whole
should pursue to establish a right to win — the ability to engage in any
competitive market with a better-than-even chance of success — in the markets
in which they compete. Second, they need to hire and retain the talent that
will support their role in developing these enterprise capabilities.
Choosing
the Right Capabilities
Marketing leaders agree that they
need to invest more wisely in capabilities. Yet when they were asked to score
these capabilities on a scale of one to seven, our survey respondents
experienced difficulty prioritizing them. (See Exhibit.) In fact, 50 percent of
respondents rated five or more marketing capabilities as “most important” to
their company’s future success. This pursuit of multiple capabilities within
the marketing function is problematic, because it tends to exacerbate a number
of challenges that marketers already face. Funding constraints are particularly
thorny in today’s operating environment; in our survey, funding issues ranked
as the top challenge (selected by 44 percent of respondents) for companies
trying to build capabilities.
Marketing organizations’ lack of
focus runs counter to a critical lesson proven by leading companies in the
marketplace: When it comes to capabilities, less is often more. The
cover-your-bases tack that marketers seem to favor now may allow their
companies to do a variety of things pretty well, but no single capability
differentiates them. In contrast, companies with best-in-class marketing nearly
always establish the right to win by being superior at only a select few
capabilities. For instance, American Express Company has established a
reputation for customer service, in part through its use of digital assets,
such as open forums that help it develop personalized relationships with its
customers. The company strengthens the effectiveness of its marketing efforts
by tracking customer responses to its marketing messages across a range of
touch points.
Leading marketers have learned to
distinguish three separate classes of capabilities. Right-to-play capabilities are
the basic functional capabilities, such as campaign management, media buying,
and budgeting, that any marketing organization should have. Right-to-compete
capabilities are those marketing capabilities that any company must have to
compete effectively within its industry. These would include, for example, a
customer relationship management platform in the financial-services sector,
format optimization in retailing, and brand management in consumer packaged
goods. The third category includes the overarching capabilities that leading
companies cultivate at the right-to-win level. These capabilities, which are
generally cross-functional and complex, reinforce one another as part of a
single capabilities system. They link directly to the company’s fundamental
strategy (its “way to play” in the market), and are relevant to most or all of
its products and services. It is this coherent alignment between all the
critical capabilities, the market, and the portfolio that differentiates a
company from competitors.
In developing right-to-win
capabilities, distinctiveness is critical. Two companies competing in the same
industry can end up with completely different positioning in the market. A big
part of Apple Inc.’s success, for example, is that the company combined four
core capabilities — consumer insights, innovation, product and interface
design, and digital marketing — to establish a coherent customer-facing
identity that incorporates the company’s values and feeds its trendsetting
image in the marketplace. Each company needs to tailor its choices to its
strategy and positioning.
Companies also need to know when to
walk away. For example, social media’s mere popularity should not automatically
make it a priority for every organization; marketing leaders should weigh how
important social media is to their company’s overall strategy and allocate an
appropriate level of investment. The chief marketing officer at a global
beverage company perhaps said it best: “Marketers must often be charged with
saying ‘no’ to change, by building a clear positioning and staying with it.”
Putting
the Right People in Place
Seventy-five percent of our
respondents said they plan to build their marketing capabilities in-house, and
58 percent of our respondents indicated they will turn to outside partners for
help. Either approach will require marketers to place more emphasis than ever
before on attracting and cultivating the right talent — to drive change
internally or to manage a growing network of outside partners. Yet finding
people with the right skills ranked as the second most daunting challenge to
building the kinds of capabilities that marketers need to succeed today.
One of the refrains that came out of
the survey interviews is that senior marketing leaders, in their recruitment
efforts, are struggling to find an appropriate balance between specialists and
integrators. Marketing organizations need specialized talent for areas such as
digital marketing, social marketing, and multimedia, but specialists often lack
broad management skills. Integrators may not have knowledge of new marketing
functions and activities and may not be as responsive to increased industry
complexity, but their critical and creative thinking skills, combined with
their ability to collaborate across specialties, are integral to the success of
many marketing efforts.
Leading marketing organizations
address these challenges by employing talent management systems that identify
workforce requirements for delivering on their chosen business strategy.
Southwest Airlines Company, for example, has made a name for itself in customer
service, a differentiating capability that stems from its “hire for attitude,
and train for skills” philosophy. Southwest hires people for specific roles,
but the company’s cooperative culture and structured incentives encourage them
to collaborate and embrace a “work hard, play hard” mind-set.
Many of our respondents pointed to
the importance of developing senior marketing executives with traits that will
enable them to evolve as the scope of their responsibilities changes. For
instance, best-in-class senior marketing leaders demonstrate a collaborative
and participative leadership style. They tend to be approachable and informal.
When making decisions and solving problems, these leaders demonstrate an
ability to combine creativity and decisiveness, and are comfortable with
complexity and ambiguity. Success comes from encouraging behaviors that yield
the desired results. Google Inc. understands this better than most companies.
To encourage innovation and agility, the company requires employees to spend 20
percent of their time on projects of their own choosing.
But attracting the right talent is
only one part of the equation. People need to see how their roles will evolve
over time if they are going to stay with the company and remain productive and
creative contributors. Survey respondents who described their company as a
leader in its respective market were more likely than self-described market
followers to be focused on providing a competitive career path for marketing
employees. For example, in shifting its talent system to address a shortage of
leaders, Royal Dutch Shell PLC identified talent within the company by focusing
on technical skills and leadership ability. The development program was customized
for frontline, midlevel, and executive staffers, and was incorporated into the
company’s university relations and diversity initiatives.
A
Focused Approach
Given the increasing pressures and
disruptive forces they face, marketing organizations can’t be blamed for trying
to be everything to everyone. With so many opportunities to connect with
consumers and businesses in new ways, it is difficult for marketing leaders to
know which capabilities are worth pursuing. But the success of top marketing organizations
has demonstrated that playing a key role in two or three differentiating
capabilities, tied to the company’s overall capabilities system, is far better
than being above average in many.
Once these right-to-win capabilities
are established, marketing leaders can methodically evaluate their talent
needs, create tailored compensation and incentive programs to drive
capability-building behaviors, and attract and cultivate the kinds of future
leaders who will enable their companies to adapt and succeed in any
environment. A marketing organization that engages in capability building and
talent development in this careful and coherent way will put itself in a
position to face mounting pressures and prove its worth to its company’s
overall strategic mission during these rapidly changing times.
http://www.strategy-business.com/article/12202?pg=all
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