Marketing Middleware

Short CMO tenure has become a widely accepted fact of life. The arguments for this state are also getting quite familiar: Poor cultural fit, overly ambitious agenda, lack of productivity, change in business strategy, no budget… just to name a few.

More often than not, there’s a more fundamental issue at play, and it’s one that is systemic across organizations. There’s a missing piece of what we call marketing middleware—the “Intel Inside” of marketing. This middleware is the organizational marketing capability necessary for the CMO to succeed.

An organization may have strong leadership that charts a clear course and sets business strategy. And it may have functional marketing capabilities to effectively drive tactical execution. But the core marketing capabilities that are responsible for the translation between the two often seem to be in disrepair. Just as in software, where middleware serves as the glue that connects applications and allows them to work together, marketing middleware enables the back and forth translation of strategy, insights, and execution.

Building this marketing middleware is not just about CMOs saving their jobs. It’s also about CEOs saving theirs. Making the shift towards a market focus is critical as markets mature and products are increasingly commoditized by competition. The demands for organic growth, global expansion, going beyond productivity and cost savings make the need for building strong marketing capabilities more profound than ever before. What follows is a path for custom designing middleware to fit the organization.

First Step: Define Standard Work

Designing middleware starts by defining the standard work that marketing must do. For many organizations, the marketing function plays the traditional marketing communications role—advertising, collateral, etc. The reality is that marketing is more than just the functional delivery mechanisms. It is about understanding what customers will buy, determining what the organization can provide, and matching the two in a way that delivers sufficient return on capital.

The CMO should start by defining the standard work of the marketing function such that it plays the role necessary to support the company’s growth agenda. Should it add customer insights gathering and dissemination responsibility to its communication role? What part should it play in innovation? Should it become the quarterback that drives growth initiatives? Should it manage and be held responsible for P&L? In other words, it is important to determine and make clear to the organization how much marketing is expected to be done by the marketing function.

GE began to build its marketing capabilities in the last decade when it realized that its leading technologies did not necessarily sell themselves. Many years before, GE had standardized the roles of other functions like finance and HR, but it had never done so for marketing. GE created marketing centers of excellence and a Marketing Council, among other enablers, to create such standards. In an article she authored in the October, 2010 issue of the Harvard Business Review on “Unleashing the Power of Marketing,” Beth Comstock, Senior Vice President and CMO of GE, writes: “The value of a common language, rigor, and process across a previously highly subjective area cannot be overstated.”

Shari Stein, Vice President of Marketing for Standard & Poor’s, took a similar approach. She told us: “Creating a common set of marketing norms and a common language were early first steps—it helped our people understand that we wanted the function to be more strategic and that we wanted our global teams to be operating from a similar base of expectations and capabilities.”

Step Two: Establish the Competencies Needed To Do the Work

Middleware design continues by defining and codifying the competencies that members of the marketing organization must possess in order to deliver the standard work. Integrating competency assessments into human resource processes will help ensure effective execution. Regardless of how standard work is defined, required competencies often group into the following four dimensions:

Know the Market. This dimension of competencies includes those skills related to understanding and having a unique perspective on what happens outside the company’s four walls and the ability to translate those insights in a meaningful way. Many companies view “doing market research studies” as an important role for marketing, but have not elevated this from information collecting and reporting to the development of insights that can drive business strategy.

The competencies part of this dimension may include:

– Generating customer insights.

– Understanding competitive threats and opportunities.

– Identifying implications of a changing market landscape.

Develop the Growth Strategy. Determining how to invest organizational resources to achieve growth goals should be the work of marketing. Yet, this is often the biggest stretch for CMOs attempting to build capabilities in their companies. Ann Ness, Vice President of Brand Management at Cargill, told us: “Until recently, many of our marketers came from sales and moved into marketing when they fell in love with their products. They often did not have the skills needed to make the case and secure resources for growth initiatives.” Creation of a “Cargill Marketing Academy” and bringing in outside talent from leading marketing firms and strategic consultancies are part of how Cargill is up-skilling its marketers.

The competencies part of this dimension may include:

– Understanding how economic value is created for the business and what levers can drive it within the organization’s P&L.

– Building a strong, differentiated brand position and value proposition, and translating them for channel partners.

– Identifying growth opportunities and strategies in a way that is consistent with the brand position and can deliver growth objectives.

– Driving offering expansion through product and service innovation in a way that is consistent with the brand position and business strategy.

Execute the Marketing Plan. These competencies are the basis upon which marketers have traditionally been hired and evaluated, and should remain an area of focus. By including them in the standard work and the competency model, an organization can signal that traditional marketing remains important and that the organization must continue to get better.

The competencies part of this dimension may include:

– Building an effective customer and channel partner engagement plan.

– Positioning the company’s strategy in a way that creates mutual wins through the channel.

– Developing clear and concise marketing communication plans including the right mix of audiences, messages, and mediums.

– Installing an effective metrics and continuous improvement process.

Lead the Right Way. While the previous dimensions and competencies describe the marketing organization’s required technical skills, marketers also need several people skills to be effective. Comstock writes: “At GE, if you don’t run a P&L, it’s assumed that you don’t have the influence to drive change. So marketing leaders have to build coalitions and persuade others, using functional expertise, insights, and teamwork rather than authority.” While CMOs must determine if these skills can be cultivated in individual members of their teams, making them part of the required competencies ensures the right skills are developed and recruited.

The competencies part of this dimension may include:

– Executing flawlessly and driving for results.

– Leading and influencing teams.

– Managing and developing talent.

If middleware competencies are built, they create a currency inside an organization that a CMO can utilize. They also go a long way toward changing the dialogue in which marketers participate, from “Can I use that logo?” to “How much growth can I expect from a segment?”.

Step Three: Actually Building the Middleware

Once the standard work of the marketing function and associated competencies are determined—the middleware design—the CMO can turn to actually building the middleware. To do so requires determining the current state, defining a destination, assessing the gaps, and building a plan to close them. One client, after announcing its “Strategic Marketing Initiative,” used a managerial assessment of its marketing vice presidents and directors to diagnose its current state and identify priority improvement areas. With gaps identified, a comprehensive training and development program could be built, which is in the process of being rolled out across the company.

While the path in execution is varied, a common set of practices is frequently applied:

Communicate: Continually reinforce the case for change and paint a picture of the desired end state. In the mid-2000s, ConAgra Foods’ CEO Bruce Rohde issued and widely communicated his “Marketing Manifesto,” that declared the need for marketing to become more of a growth-driving function than it had been. Whether related to building  marketing competency or otherwise, organizational change initiatives will bog down without continual air cover from the top.

Create common frameworks and start deployment at the top. A common set of processes and frameworks, dubbed “The ConAgra Way” also was rolled out as a keynote course in the new “ConAgra University” for marketers across the company’s (then) four geographies. After initial feedback of “great training… but my boss doesn’t ask for work product in this way,” critical mass was reached when each business unit’s senior marketing leaders were taken offsite for a two-day executive-level version of the course, and all standard planning templates were issued consistent with the ConAgra Way.

Measure progress and course correct. GE convened marketing leaders for its first annual self-evaluation and to create a benchmark to measure future progress. Our aforementioned client conducted a global marketing talent calibration meeting in late 2009 to ensure capability building initiatives were focused on the right things.

Plan for early success… and plan to capitalize. Quick, visible wins can provide a jolt of energy and restore momentum after initial excitement fades. Identifying and capturing the low-hanging fruit can create reason to believe for the organization if marketing leadership stands ready to declare victory. Cargill has capitalized on a moresubstantial win with the launch success of one of its first consumer products, Truvia.

Create joint functional ownership. Capability-building must be owned by senior leaders of both the marketing and human resources functions. Initiatives by marketing that are not integrated into common human resources processes might be seen as a one-off rather than a new way of doing business. Sponsorship and execution by HR alone will struggle to achieve credibility in the marketing ranks.

Avoiding Pitfalls

Once CMOs recognize the need to upgrade or build middleware, they often make the mistake of launching a disjointed set of initiatives. A decade ago, Motorola raided nearby Kraft Foods for marketing talent, only to find a few years later that they weren’t prepared to make use of the talents of the people they brought in. An exodus of the new talent soon followed. Hewlett Packard made similar missteps by launching headfirst into a new market facing structure before the talent and process necessary to support it were in place. After basic “blocking and tackling” failed, HP was forced to retrench before course correcting and restarting its transformation.

By taking a comprehensive approach to designing the middleware first, the CMO minimizes the chances of this resource- and culturally-intense activity faltering, and ensures a greater likelihood of long-term business and marketing success. This alleviates the pressure that often leads to less than ideal value creation and, ultimately, a short CMO tenure.