The Government's newly released National Innovation and Science Agenda shows that for economic growth to continue within Australia, an 'innovation ecosystem' must be fostered, where new businesses with new ideas are encouraged to grow and flourish. With every company wanting to increase, retain or improve their customers’ experiences, this makes marketing vital to fuelling Australia's ideas boom.
While we’ve only seen a handful of chief marketing officers become CEOs to date, digital disruption and the rise of customer centricity as a core pillar of competitive advantage are paving the way for more to rise to the top job.
Here, we present five reasons why CMOs are in a great position to become the preferred candidate for CEO.
1. Because CMOs have to listen to everybody
Ram Menon, the former CMO and now president of social computing at infrastructure management software vendor, Tibco, expects to see more marketers becoming business leaders primarily for two reasons.
The first is that today’s modern marketer is the guy or girl who has to listen to everybody, whether they like it or not. During his time as marketing chief, Menon says he had to listen to what everybody had to say “whether I solicited their opinion or not”.
“There is no other person who has to listen to everybody,” he claims. “To the CEO, or the head of sales asking for more lead generation; to the CFO who’s asking about how much money he spends each month; and to the customer who after buying the software or product, has deployed it and is either happy or unhappy.
“If a marketer is willing to listen, he or she develops a keen sense of the pulse of the business. That gives them perspective, and that is very useful when you come to run the business.”
While general management nous, such as people and analytics skills, are important, and many business leaders have more strengths in these areas than others, Menon suggests such skills are now textbook stuff.
“What you really want when you’re running a business is perspective across all your stakeholders before you make a strategic decision,” he says. “The second thing you learn when you get perspective is you get empathy.
“A marketer, if he or she does listen and develops empathy towards stakeholders, becomes a very powerful force in driving a business because he’s got this multi-dimensional view that is needed to be a CEO.”
The reasons marketers haven’t yet become the expected candidate for CEO is because it’s still early in the maturity cycle of the CMO role as well as for many industries like technology, Menon adds.
“Marketers are moving from communicators, to being key stakeholders in driving the business; to lead generation people; and to brand ambassadors. As you go through those stages, you develop perspective. That has only really happened in the last 10 years, as we’ve had this tech tonic change in the way marketing is done.”
2. Because CMOs have earned their stripes in product and P&L responsibility
Using his experience within the tech industry, IDC group vice-president of executive advisory strategies, Richard Vancil, admits the traditional perception of a CMO’s competencies hasn’t typically aligned with the (real or perceived) required competencies to be CEO.
“Those traditional perceptions were of the CMO as a senior corporate-communicator; a corporate brand evangelist; and so on, but not an executive who earned and carried significant revenue or P&L responsibility,” he comments. However, Vancil expects this to change.
“Today, I think there are two factors that might lead to the CMOs potential to be a CEO. First, there are many CMOs today who have spent a good part of their career managing large product lines; field operations; and/or revenue and P&L centres. They are business-people first, and marketers second,” he tells CMO.
The fact that the average CMO in the tech sector now has a job tenure of about 60 months – a significant jump up from an average of 24 months just a few years ago – could also lead to further advancement into general management, Vancil claims.
“The second factor is that very soon, perhaps within five years, the marketing function will be able to definitively quantify its contributions to the ‘business’ as a whole,” he continues.
“This quantification might be number of new customers; or revenues; or profits. Marketers have been trying to prove this ROI for their whole careers, for decades, but they haven't had the software or tools. All of the software just isn't in place yet, but it is developing fast.
“I am certain there will be a day when a CMO will be able to develop irrefutable marketing ROI numbers that they can bring into the boardroom. When this happens, they will become a CEO candidate.”
3. Because businesses need creative leaders
According to CEO of executive recruitment firm Hourigan International, Anthony Hourigan, businesses have been turned upside down by digital disruption in recent years and are looking for ways to make their people and culture more creative, collaborative, agile and comfortable with risk.
He believes the future will belong to organisations that can best connect and respond to customers, combine hard analytics and commercial skills with imagination and innovation and drive top-line growth. Hourigan labels this creative leadership and says the one-time CMO is the executive best placed to deliver it.
The challenge for marketing leaders – the creative tribe – is to make the case for why it’s now time for businesses to put the emphasis on driving change, leading for tomorrow and embracing risk, Hourigan says.
“Creative leaders all possess the core, traditional, hard commercial traits of leadership, but in balance with a range of more creative and imaginative traits,” he says. “They are comfortable with seemingly contradictory attributes including intelligence and intuition, commerce and creativity, control and collaboration, stability and change.
“We, the marketing community, can and need to lay claim to this ground. We have to work hard to elevate each other, to promote the work and impact of our tribe.”
4. Because CMOs are leading business transformation
In a recent article for <i>AdAge</i> in the US, Korn/Ferry senior client partner and leader of its Marketing Center of Expertise, Caren Fleit, said the evolution of the CMO from pure brand builder to enterprise change agent is paving the way for more CMOs to ascend to the CEO spot. She also highlighted a poll undertaken by Korn/Ferry last year of more than 100 business executives, which found 54 per cent see their current CMOs as having the potential to one day take over the CEO role.
“Often they are responsible for redefining business models or go-to-market strategies, driving a strategic agenda that will create significant value for the business and its stakeholders, and leading at the highest levels to drive change across organisations,” Fleit stated in her article last November.
“Traditionally, these responsibilities fall under the territory of the CEO. Today, more CMOs are working closely with their CEOs to drive the evolution required to succeed in a rapidly changing landscape.”
5. Because CMOs have true vision
In April, Mozilla appointed former CMO, Chris Beard, as its interim CEO. In a subsequent blog post, Mozilla’s executive chair, Mitchell Baker, attributed Beard’s appointment to his clear strategic vision.
“Chris [Beard] has one of the clearest visions of how to take the Mozilla mission and turn it into programs and activities and product ideas that I have ever seen,” she said.
“In the early years at Mozilla, he was responsible for leading the Mozilla product, marketing and innovation teams. More recently, Chris was our CMO, leading user, developer and community engagement activities globally, including the initial launches of Firefox on Android and Firefox OS at MWC. Chris is the right person to lead us through this time and he is a strong candidate for CEO.”
Baker said the appointment was a reflection of the need for Mozilla’s leader to be responsive and agile to market conditions.
“Mozilla needs to act quickly and decisively. This is key for any leader at Mozilla, including our CEO, whether interim or otherwise. Chris’ experience and insight is highly aligned with our goals,” she added.
It’s clear today that CMOs see vision and leadership as core attributes of the modern marketing chief. In fact, according to former CommBank CMO and respected marketing leader, Andy Lark, CMOs underestimate the power and ability they have to build the business in their image.
“Brave CMOs seek to challenge the structure of the business; you have to set the tone and the pace,” he said.
With such experience and clout leading marketing and customer strategy today, surely the leap to corporate vision for the CMO isn’t that big after all.