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Preparing for the Future: How the CIO and CMO Must Collaborate to Win

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In the past, the CMO and CIO have had a tenuous relationship, with each role vociferously complaining about the other's lack of understanding, knowledge, and respect.

However, two powerful exponential trends (growth rates of data and technology), will dramatically affect enterprise operations, forcing the marketing and IT functions to communicate and collaborate like never before.

To survive and capitalize on those trends, CIOs and CMOs will have to align strategies, pool resources, communicate more effectively, and find common ground wherever possible. The future viability of the enterprise depends on it.

Exponential Growth of Technology and Data

A technological and data-driven revolution is underway, and in some instances it is happening right under our noses.


Moore's Law, conceptualized by Intel pioneer Gordon Moore, states that the number of transistors per microprocessor will double every two years. This exponential increase in processing speeds for various machines/devices will eventually enable advances in economics, biology, technology, business, and other key fields.

The second powerful exponential trend is the increasing amount of data that companies must contend with on a daily basis. According to a Forrester Research report titled "Data, Data Everywhere," the "volume of the world's data doubles approximately every three years"!

Companies around the world are literally drowning in data. A typical airline or retailer, for example, is collecting data from myriad operational systems and storing terabytes, if not petabytes, of data.

And for most companies data isn't conveniently stored in one central location—it is often found on spreadsheets, data marts, and storage devices strewn across the enterprise. In fact, in many organizations, marketers are a key culprit in the creation and upkeep of separate "pocket databases" containing customer lists and purchase histories.

And while capturing and storing relevant data is a challenge, an additional obstacle is analyzing and translating this data into actionable information to improve the customer experience or drive operational efficiencies.

Adding insult to injury, the exponential growth of both data volumes and information technology continues unabated, making it difficult for most enterprises to stay ahead of these S-curves.

Exponential growth is often hard to grasp. Look at the technical innovation that occurred in just the past five years: the boom of social-networking platforms, mobile device proliferation, and deployment of advanced algorithms to solve extremely complex challenges. What innovations will the next five years hold—the next 20?

Instead of fearing these exponential trends, however, the smart executive realizes that advances in data growth can and should be harnessed by the technologies of today and tomorrow. It's almost a marriage made in heaven.

Competing with an Analytical Infrastructure

Recent books such as Competing on Analytics, Smart Enough Systems, and Super Crunchers contain countless case studies of high performing corporate and government entities that are taking advantage of data and information to drive tangible business value.

In fact, a global survey by Accenture of 450 executives in midsize-to-large enterprises discovered that "high performance businesses are 50% more likely to use analytics strategically compared with the overall sample and five times as likely as low performers."

And though the benefits of competing as a data-driven enterprise are well documented, two fundamental shifts within the enterprise had to occur before this transformation could take place.

The first major shift was in the role of the CIO.

A Wall Street Journal article titled "CIO Jobs Morph from Tech Support into Strategy," February 20, 2007, details how in previous years a CIO had to concentrate mostly on keeping systems and applications running. Today, the article points out, "technology is increasingly recognized as a vital tool in corporate strategy and CIOs are helping to wield it."

Technology—managed by the CIO—is helping automate business processes; sense and respond to critical events such as supply chain disruptions; and, increasingly, improve the customer experience.

The second major shift was the realization among marketing professionals that they too needed to diverge from spending a majority of their time on tactical efforts.

Articles from Harvard Business Review, such as "Bringing Customers into the Boardroom," and books such as Marketing as Strategy by Nirmalya Kumar, insisted that marketing professionals tightly align activities with corporate strategy.

Kumar, for example, challenged marketers to "capture the imagination of CEOs" by focusing on improving customer loyalty and retention, lowering costs, and creating innovative products in tune with customer needs.

And though marketers have always focused on customers, CIOs have started to realize that their "customer" isn't internal constituents but those persons and businesses who actually pay the bills and consume the company's products and services—the same customer that marketers target!

So the interests of the CIO and CMO are quickly merging.

Marketers need fresh and accurate data for advanced marketing functions such as better segmentation, more effective campaigns and offers, and relevant interactions with the customer across multiple touchpoints. And CIOs realize that the benefits of creating a single source of relevant and accurate data for business analytics go far beyond helping marketers get closer to customers—and in fact benefit all aspects of company operations.

Both the CIO and CMO have a stake in the development and implementation of an analytical infrastructure capable of turning data into actionable information that in turn enables better decision-making not just in marketing but across the enterprise.

An analytical infrastructure typically consists of data integration and data warehousing technologies and business intelligence and other applications.

An ideal situation is for frontline workers—closest to the customer—to also have the ability to query these systems to obtain timely intelligence. New technologies, as they develop, will enhance and expand the reach and capabilities of this analytical infrastructure.

However, a powerful analytical infrastructure is more than just a grouping of technologies and applications. Diverse processes such as data management, data governance, and data analysis, among others, should work hand-in-hand with people skilled in mathematics, business strategy, and data administration.

When people, processes, and technology are closely aligned with corporate strategy, the organization can better respond to changes in the marketplace and rapidly meet evolving customer needs.

This data-driven vision in which marketing and IT work hand-in-hand to design, implement, maintain, and improve an analytical infrastructure, sounds "good on paper." Reality, however, dictates that marketing and IT must first overcome communication, cultural, and organizational barriers to partnering together.

Overcoming Communication Barriers

Stephen Shaw, in a Marketing Profs article titled "Marketing and IT: Two Solitudes," notes that although the relationship between IT and marketing has improved over the years there is still a communication gap between the two groups:

"Each group speaks a different idiom, and neither side is willing to gain familiarity with the other. Marketing gets annoyed at what it views as obfuscation, usually in the form of slippery excuses for project delays, while IT invariably complains of wooly job specifications. Marketing has an aversion to technology (unless it makes its job easier) and is often guilty of equivocation, while IT habitually retreats behind an impenetrable wall of jargon."

Instead of communicating needs, marketers often turn to agencies, software as a service (SaaS) providers, and other third parties to circumvent working with IT. And while this strategy provides a temporary fix for today's demands, it does nothing to mitigate the challenges of the future noted in this article.

Though it might not be practical for IT to assign dedicated resources to help marketers, a good solution for overcoming communication barriers is the development of a purposeful plan, with the CIO and CMO meeting weekly or biweekly to discuss shared goals, priorities, projects, and synergies.

The output of these meetings can be notes, project plans, and other documents distributed across both groups to show how the two functions are working together to meet business needs.

Overcoming Cultural Barriers

The cultural barrier is probably best symbolized by the quirky yet humorous "Mac vs. PC" advertisements from Apple.

Marketers are usually recruited from business or liberal arts schools, and most are heavily right-brain individuals—the "Mac guy." A typical information technology worker, on the other hand, tends to have an information, engineering, or computer science background—the left side of the brain—the "PC Guy."

Marketers often assume that cultural differences between the marketing and IT functions are stark—but in reality the groups are two sides of the same brain. In fact, in today's corporate environment, marketing professionals are increasingly asked to be more analytical and numbers-driven, while information technology professionals are often asked to think more strategically about how IT can enable business growth and cut costs.

With marketers tasked to become more analytical, and technology workers asked to think more creatively, both functions are evolving toward each other.

To help overcome cultural barriers between marketing and IT, the CMO and CIO should consider cross-functional training opportunities. "Walking a day or week" in the life of the other job function often quickly changes perceptions and offers newfound appreciation for the complexities of each role.

Overcoming Organizational Barriers

The corporate organization chart is designed to help define roles, responsibilities, and reporting structures.

In many companies, the boundaries between Marketing and IT are even more defined: they have their own budgets, they are usually located in different parts of the building, and of course they have different leaders.

To work across organizational boundaries, companies should consider joint projects between business (in this instance marketing) and IT, with both having a stake in the successful outcome of those projects.

Take, for example, a data-quality project that might logically be into the domain of IT. In fact, data quality affects every part of the organization, as decisions are only as good as the quality of data they are based on. Marketers should also have a keen interest in data quality to promote better and smarter marketing efforts.

On such a project, both the IT and the marketing functions should work closely together to consolidate disparate data sources, establish data-collection policies, and standardize data definitions.

Collaborating on projects of importance that touch both IT and Marketing is a surefire method for breaking down organizational boundaries.

Conclusion

Yogi Berra once humorously said, "It's tough to make predictions, especially about the future." We cannot predict with 100% certainty what will happen tomorrow, but we can prepare for the future by acknowledging the impact of two obvious exponential trends.

With more commonalities than differences, both the marketing and the IT functions need to realize that only by purposefully and systematically working together will they be able to effectively champion, build, maintain, and improve an analytical infrastructure capable of harnessing the coming data explosion.


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Paul A. Barsch directs the professional services marketing programs for one of the top 10 software companies in the United States and blogs about the intersection and impact of technology and marketing (www.paulbarsch.com). He can be contacted at paulbarsch(at)yahoo(dotcom).

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  • by Roy Young Wed Mar 26, 2008 via web

    Exactly right, Paul. In fact, for inspiration and support, marketers should learn from a great case study of a successful marriage between Marketing and IT at Harrah's, which has become the most profitable company in the gaming industry. (See my book, Marketing Champions, Wiley 2006 for details.)

    As his first strategic move as COO at Harrah's, Gary Loveman (who later became the CEO) replaced all of Harrah’s existing marketing staff with marketers who had data-crunching skills and knew how to work with IT.

    Here's what Loveman says about the strategic decision: “[The original staff] were never going to get our program where it needed to go,” he says. And they were “never going to build the decision tools or be able to plot out the mathematics of this program the way we needed. So we brought in the kind of people we have now, who have the horsepower to do this kind of work…. We created a marketing council. I chaired it as the senior operator and the senior marketer, and I brought together three of the four senior corporate marketing people and the four senior field marketing people as well as our outside agencies, our PR agencies, and our senior technology person, because so much of our marketing runs through technology systems…. It’s an effort to make sure that all our marketing work is a collaboration between corporate and the field and that everybody owns these decisions.”

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