Why more CMOs aren't becoming CEOs
- 10 October, 2013 08:27
In the past two decades, marketing has established itself as one of the lynchpins of modern business, essential to the support of sales and business strategy. But with the role of the CMO rising accordingly, an obvious question emerges as to why more CMOs have not stepped up into the top job, or beyond.
It’s a transition that is relatively common in consumer-oriented sectors such as fast moving consumer goods. But in the broader realm of B2B and services-based businesses it is more common to find CEOs that hold legal and finance degrees, and may boast years in senior sales roles. Few have a marketing degree tacked to their office wall.
The reasons why so few CMOs move on to general management are numerous.
According to Mark Crowe, chief executive officer of the Australian Marketing Institute, many are simply in love with marketing and have little ambition to try their hand at something else.
But for those that do, many face immediate barriers stemming from how marketing is perceived – a perception that can quickly turn negative when all that senior leadership knows about marketing is derived from the more visible elements such as marketing communications or event management.
“Their exposure to advertising and marketing is what they see through the media, so there is that natural assumption to think that’s where marketing ends,” Crowe says.
According to the regional director at recruitment firm Michael Page’s Retail, Marketing & Digital division, Richard Wynn, it is vital that any marketer that aspires to higher roles expand their skill set and gain exposure to different business functions. But to be taken seriously as a marketer, they must also demonstrate a strategic skill set.
“The people who can demonstrate that capability and bring that to life and talk about how they have grown a business – those guys really stand out from the crowd,” Wynn says.
Hence one of the pre-requisites for any marketer wanting to ascend the corporate ladder is to broaden their experience.
This was certainly the intention of Heat Group founder and CEO Gillian Franklin, who parlayed the marketing experience she gained at Revlon into a senior management role before founding her own company.
“I just talked to people all the time and learned about everything, so I understood everybody else’s needs and I could be a really good partner for them,” Franklin says.
“Marketers need to move out of marketing in terms of the way they talk to people and work with people, and really spread their tentacles far and wide and learn about all aspects of the business. So you have the core requirement, but you also understand how much cash you need, how the supply chain works, what sales needs, how IT works, etc.”
Another common problem for ambitious CMOs is tenure. While Wynn and Crowe agree that the average tenure of senior marketing roles has increased from more than two years to more than three, that may still not be long enough to get them on the radar of senior leadership, including the organisation’s board.
According to Crowe, ambitious CMOs are competing with CFOs with upwards of 10 or 12 years tenure, during which time they have often served at the CEO’s right hand.
“That experience and knowledge in being there for that period of time does really set you up in terms of your candidacy for higher service,” Crowe says.
But the quest for greater tenure may set some marketers in opposition to the nature of the role itself. A common scenario is for a marketer may be recruited to perform a very specific task, such as reinvigorating a brand, improving customer engagement or creating a new growth strategy. That may take a year in planning and a year in execution, followed by a year or less of circumspection.
Wynn says regardless of the strategy’s success, many marketers find themselves itching for the next challenge, rather than re-treading familiar territory.
“They move to a company to deliver that vision and that strategy, and once they have done that that they run out of steam, or they have achieved what they wanted to and they get excited about the next big thing,” Wynn says.
That behaviour then tends to see them seeking out similar – although perhaps more senior – roles at other organisations. Crowe says makes them highly effective as marketers, but may limit their exposure to other functions within the business, and hence limit the development of their skills.
Another factor working against Australian marketers specifically may be the size of the organisations they can land roles within. According to Intel Australia’s managing director (and former marketing manager), Kate Burleigh, the relatively small number of large organisations here that can support large marketing departments reduces the opportunities for marketers to broaden their experience.
“In smaller markets like Australia companies unfortunately don’t always invest in marketing to the extent that they probably should, and for that reason a marketer’s experience in Australia can pretty much stop at a mid-point in their career,” Burleigh says. “Their budgets never get bigger or the targets don’t ever get bigger because it is harder to grow businesses in Australia.
“And unfortunately when that happens it also means that you career is not growing any more either. “
There are, however, an increasing number of exceptions to the rule. Westpac CEO Gail Kelly is one example, as her career includes marketing roles in addition to experience in retail and commercial banking, strategy and human resources.
Kelly is testimony to the need to gain a diverse range of experiences, but her ascension to the top role also reflects the much greater emphasis that banks place on marketing today. Crowe says twenty years ago banks barely had a functioning marketing department.
“These days you can see in banking that the marketing people have a much higher profile,” Crowe says. “Now the CMO in a major bank is a very significant role.”
Technology is another sector where the prominence of marketing is increasing. This was demonstrated by Intel Australia’s Burleigh when she was named managing director in April 2012.
Another example occurred at Blackberry when the smartphone maker appointed its marketing director Matt Ball into the managing director’s role in June 2011.
According to Ball, the idea that marketers in B2B organisations can make effective leaders is one that needs to be busted.
“More and more large organisations are looking invest and want people who have deep skill sets in some of those marketing areas,” Ball says.
Crowe believes other industries will follow banking’s lead, if for no other reason than the simple fact that lean economic times have led many to cut their organisations back to the core, and hence must they now pursue more aggressive growth strategies if they wish to survive.
“There is an increasing awareness from boards and senior management that a lot of the focus has got to go to growth,” Crowe says. “The emphasis is going to be on growth and rising revenue, and marketers are well placed to being key to the strategy around that.”
Also working in favour of marketers – although perhaps younger ones – is the rise of digital marketing. The ability of digital channels to deliver much more granular and reliable data on marketing effectiveness has started to erode some of the perceptions of marketing being a gut-feel or hit-and-miss function, and put it closer to par with other data-driven functions such as sales.
Hence Wynn says it is essential that any marketer who aspires to sit in the CEO’s chair ensure they have strong digital skills.
“The guys that are thinking long term about being the CEO one day, and wondering how they are going to get there, well they need to embrace change and pick up this digital world,” Wynn says. “That is where the skill set is changing.”
Burleigh says the growth of digital channels certainly played a role in the development of her career at Intel.
“The tools we are using allow us to have much broader conversations with people, and it’s not all about B2B sales any more,” Burleigh says. “We are able to go one-to-many, and that customer relationship department is becoming the department that everyone wants a piece of now.”
The final factor that might elevate marketers in the eyes of their leadership peers is that the nature of business itself it changing. As a result Crowe says marketing itself is evolving from being a discreet function to becoming a capability that is more widely distributed across the business.
“Customer touch points are not just through one channel now – they are across the business,” Crowe says. “Customers are interacting with businesses and brands in any number of ways, and social media in some respects is just the latest example of that. So the classic contribution of marketing through a departmental approach has changed lot.”
The result is that marketing has become more involved in other aspects of the business, such that marketers are having to interact more with other function leaders. That should lead to a broadening of business experience simply by default.
“And where marketers do that, that is helping raise their profile in the business – they are no longer the people who sit in the back room,” Crowe says.