You knew it was coming: the CMO may not only end up outspending the CIO, but some believe they should be the IT department’s new boss, too.
In a recent story on CMSWire, for example, it was pointed out that this hierarchy is already in place at companies like Marriott International, but some suggested this is entirely the wrong approach and a premature move by senior management.
“Marketing’s dependence on IT has grown, true,” said Loni Stark, director of product & industry marketing for Adobe’s Digital Marketing Solutions. “But marketing also depends on hiring the most talented, creative and empathetic thinkers, and yet we don’t debate if HR should report to the CMO.”
Most likely CIOs will end up reporting to CMOs in highly marketing-driven organizations where much of the traditional IT functions, such as managing server infrastructure and other elements of the data centre have already been outsourced. It could also come as a result of CIO turnover, giving some organization a reason to reconsider reporting structures. In the broadest sense, it’s probably a little too early to call it a CMO coup d’etat.
What the relationship should look like
If CIO is to become a CMO partner rather than a subordinate, what should that relationship really look like? After attending the Middle East CIO Summit, IDC analyst Jyoti Lalchandani offered some thoughtful suggestions in a publication called Gulf News.
“The challenge for many companies is that marketing is trying to keep up with rapid changes in customer behaviour, and new cloud-based deployment options make it easy for them to do so,” Lalchandani writes. “On the other hand, corporate IT is striving for homoeostasis to optimise efficiency and lower costs. These two models are inherently incompatible. Therefore, CIOs are starting to realise that they need to open more capacity to support line-of-business functions. We believe that there are many issues to work out: Who funds which projects? How can departmental requirements and enterprise policies be balanced?”
Not easy questions to answer obviously, but as Lalchandani points out, many CMOs are on their second or third attempts at “transformation” from traditional approaches to digital data-driven decision-making. CIOs could do worse than merely make a concerted effort to help.
When data really ‘drives’ decisions
For a more concrete example of how the CIO-CMO relationship is evolving, look no further than Nissan. There, the executives in those respective roles have reportedly managed a 72 percent increase in visits to the company’s Web sites following the launch of the Juke crossover.
“In the automotive world Nissan is seen as a challenger brand, so in digital we are positioning ourselves as leaders,” European CIO for Nissan, Stephen Kneebone tells CIO UK in a recent interview. “Digital is where IS can really have a role, as the experience has to be engaging, offering online configuration and design. We have to up our game and make buying a car a more natural retail experience. The dealer is part of the customer engagement and how we look after our customer post sales so that our customers are loyal and will repurchase and recommend us.”
Keep your balance
If anyone would know about collaboration, it would be a vendor like Polycom, whose videoconferencing tools are used by all kinds of companies to bring disparate team members together. In an article in the UK’s Marketing Magazine, Polycom’s senior director of marketing Sue Day suggests that if CIOs feel under pressure, their counterparts in marketing are getting plenty of heat of their own.
“When you look at the executive boardroom table, you’ve got the CFO, the COO and the CEO, and all of these are really numbers focused. If the CMO’s contribution doesn’t add up, forget it,” she says.
Polycom has been among those firms focusing a lot more on analytics, and rather than compete for dollars, Day tells the magazine IT was a key contributor. That doesn’t mean she expects to have a monopoly on the CIO’s time, however. “In a balanced organization, the CIO has responsibility to many more functions than just marketing.”
Perspective is everything
In fact, for all the hoopla over marketing’s increasing IT clout, some recent studies suggest things aren’t really changing all that quickly. Speaking to the Wall Street Journal (reg/required), Forrester Research analyst Andrew Bartels said line of business spending on IT (which could include more than the marketing department) will account for only seven percent of tech purchasing in the U.S. this year. It’s hard to imagine Canada being much different. Growth in tech spending by LOBs is only forecast to go up to 7.2 percent next year.
“There’s this consumer mentality, that ‘oh, let’s just go out and buy it’ but companies have got budgets to deal with, stakeholders to deal with. It’s not a simple, one-time buy,” Bartels tells the Journal. In fact, acting as the steward of such sourcing arrangements may well represent one of the CIO’s ongonig responsibilities. “Once IT gets involved, IT takes over and manages the vendor relationship and solution.”
Rewrite your charter
If you want a good look at CIOs who really understand where this is going, look no further than Mike Kail. He’s the CIO at Netflix, an organization that runs so well it almost doesn’t seem to need marketing. In an interview with the Huffington Post, Kail suggests the best way to position themselves to the CMO or the enterprise as a whole is for more CIOs to focus on the things that really matter: people and results.
“IT’s charter should be to improve business efficiency and move the business forward rather than being trying to ‘protect employees’ or prohibit them from doing something,” Kail says. “Do what you think is right and take ownership for it. Execute and if something is not working don’t try to force it, but rapidly change the course. Be self-aware and business-aware.”