The C-Level Shake-Up and How it Affects You

C-Suite Shake-Up and How it Affects You
It happens every time there is a game-changing disruption in the marketplace. When Larry first began his career, there were only two C-level positions in most companies: the chief executive officer and the chief financial officer. Over time, additional people were invited to the table. When information systems were identified as a new source of competitive advantage, the chief technology officer role was born. When software became critical, the chief information officer was introduced. When a renewed emphasis on human assets became a high management priority, the chief people officer position was created. Today, companies are introducing several new C-level positions reflecting new priorities on multiple fronts.

Although it goes by several names—chief customer officer, chief client officer, and the chief experience officer—one important new position is focused on understanding and enhancing the customer experience, that is, the sum of all the experiences a customer has with a brand over time. Down the hall is the chief design officer (CDO), who is charged with infusing creativity throughout the customer experience, organization, and strategy process (we discussed this role in last week’s blog post). The chief information officer (CIO) is now located next to the chief marketing officer, reflecting the importance of data in driving marketing results. At times this change in location is accompanied by a change in title—but not acronym—as CIO is being redefined as chief integration officer, chief insight officer, or chief innovation officer. Some companies are taking a different approach, installing a chief data officer (CDO) or chief analytics officer (CAO) to transform their businesses into data-driven enterprises, by combining management experience with technical ability.

The thread that runs through all of these positions is a piercing focus on our customers. There is also a recognition that the ability to design and deliver remarkable customer experience requires organizational capabilities beyond most marketing departments. An appreciation for the unique contributions that creativity, data, and analytics make in developing a deep understanding of our customers’ needs and desires, in designing the products, services, environments, and experiences through which that demand will be satisfied, and in having the infrastructure and operational ability to deliver them, is also pervasive.

The CCEO: Shifting Our COMPANY’S Point of View

Given the importance and complexity of the customer experience in defining our brands and in our ability to reach key financial goals, it is not surprising that companies are establishing new roles to lead the effort. A common strategy is to begin with an internal advisory group that is charged with developing proof points, building organizational support, and coordinating cross-functional efforts. Over time these consultative models often morph into an operational model, in which related functions are consolidated under one leader who is responsible for managing the customer experience across the organization.

Senior managers with extensive experience that span operations, quality control, marketing, and information systems are filling these roles, which for ease of reference we will refer to as the chief customer experience officer (CCEO). Their rich and varied backgrounds provide them with the credibility and networks to lead the effort across functions, business units, and third-party partners. And they have the ear of their CEOs: Seventy-five percent of CCOs sit on the executive management team of their companies and more than half report directly to the CEO.2

Wayne Peacock heads USAA’s member experience effort. He is responsible for marketing, sales and service, and enterprise data and analytics across all channels, and he serves on the USAA Executive Council. Initially, Peacock was part of an internal advisory group that carried out USAA’s customer experience effort, but over time the company’s leadership felt that consolidation was necessary to “make it how we operate.”3

How have members benefitted from the consolidation? By managing this broad portfolio directly, Peacock is better able to focus and integrate each of the underlying function’s efforts. Consolidation allows USAA to move away from traditional product-based silos to focus on meeting its members’ needs across the customer journey. These needs can vary considerably from the time members are teenagers until the time they retired and are contemplating passing on a financial legacy. Being able to combine products from across the organization in ways that makes sense for each member’s current life stage needs, allows the company to deliver superior value for its members.4

In addition, working with USAA has become even easier. Technology has enabled the company to provide members with an insurance agent or financial advisor anytime and anywhere. Members can buy, finance, and insure their homes and automobiles by phone, mobile device, desktop, or in-person, and take advantage of its low-bandwidth options when they are in remote locations. Through its Virtual Mobile Assistant, a Siri-like function available on its iPhone app, the company is simplifying its overall mobile customer experience making its app more appealing and accessible to a broader base of members, especially the elderly and those with disabilities. Video conferencing technology allows members to talk face-to-face with specialists when needed. Deposits can be made by simply taking a photo of a check or by walking into a branch or local UPS store.

USAA has made financial planning more accessible by creating budgeting and retirement planning tools and an application that consolidates members’ financial reporting, including accounts that are held at other financial institutions. A Family Life Advice Center provides useful information on managing key life transitions such as marriage, starting a family, divorce, financing college, and the loss of a loved one. Special digital communities for military spouses and veterans are vital resources where people can “get in touch and help each other out.” For these and other ground-breaking efforts, Fast Company named Peacock one of the most creative people in business.

But why is the chief information officer title being renamed chief integration officer, chief insight officer, or chief innovation officer?

The New CIO: Developing New Sources of Insight

Information technology is a vital part of the foundation upon which customer-centricity is built. Talk of big data is everywhere and with good reason. McKinsey recently described this nascent field as “the next frontier for innovation, competition, and productivity” and a “vital factor of production” on par with labor and capital.22 As an indication of the potential, McKinsey estimates that

By fully employing big data, a retailer could increase its operating margin by 60 percent and that the U.S. health-care industry could realize more than $300 billion in value annually.23

The opportunities being unlocked by truly data-driven companies are so fruitful that, even at this early stage, it is clear that companies across every sector and leaders of every function are going to have to get in the game—including us marketers. Data and advanced-marketing analytics are helping us better understand and prioritize consumers, follow their journeys, predict what they may want or need next, and design and deliver individualized-customer experiences. They can also help us to find patterns and trends in the market, our categories, and adjacent spaces, and to evaluate our marketing efforts with much greater certainty.

Realizing these gains is easier said than done, however, because big data sets, by themselves, do not have much value. Value is created when the data is analyzed and insights are derived that allow us to make better business decisions. This insight then has to be disseminated across our ecosystems, ingested, and put into action to have an impact on our day-to-day operations.

How well are we doing? Like any new undertaking there is often considerable learning to be done before the results live up to the expectations generated by the initial hype. A study by the Economist Intelligence Unit, which provides forecasting and advisory services, found a “notable gap between the value markets put on big data and businesses’ ability to glean insights.”24 Many executives (45 percent) perceived marketers’ “limited competency in data analysis as a major obstacle to implementing more effective strategies.”25

Optimism continues to run high, however. Eighty-five percent of respondents to a survey conducted by IDG Research Services and Kapow Software believe that big data has the ability to help businesses make more informed decisions.26 A majority (75 percent) view projects as successful or somewhat successful to date.27 We believe that as an analytical mind-set and capabilities are more widely and deeply developed across our organizations, big data will indeed become a key driver of business value.

Solid executive leadership is required to realize this opportunity. In addition to keeping all the existing enterprise systems running and preventing any security breaches, the new CIO needs to be able to build a broader analytics foundation than is currently available in most companies. This includes putting new technology infrastructure and tools in place to gather disparate data, coordinating data analytic efforts, building consensus around the focus of business analytics throughout the organization, and being a champion and enabler of a more data-driven mind-set across departments. This person also has to be obsessed with customers and committed to driving business results with data in real time.

The jury is still out on who is the best person to fill this role. Some companies are expanding the job description of their existing CIOs. Others are asking their CMOs to take on the job. Shiv Singh, PepsiCo’s director of digital, North America, forecasts a consolidation of the CMO and CIO roles. As Singh said during a recent Social Media Insider Summit, “Forget the CMO—the next big industry title will be the CMTO [chief marketing and technology officer]. Each time I catch up with my CMO, I ask her how much she is learning about marketing technology.”28 Other organizations are testing new positions such as the chief digital officer and the chief analytics officer, staffing them with people who have both technical know-how and marketing and management expertise.

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About the Authors

Larry Weber and Lisa Leslie Henderson are the cowriters of this Digital Marketing guide. Larry is the CEO of Racepoint Global, an advanced marketing services firm. A globally known expert in public relations and marketing services, Larry has successfully built companies and brands and is passionate about the future of marketing. Lisa is an observer, synthesizer, and writer who draws extensively from her background in marketing and consulting. Lisa and Larry have collaborated on two guides to date, The Digital Marketer, and Everywhere: Comprehensive Strategy for the Social Media Era. To stay current on their thinking, frequent www.racepoint.com/thedigitalmarketer and follow them at @TheLarryWeber and @ljlhendo.

Buy on Amazon: The Digital Marketer: Ten New Skills You Must Learn to Stay Relevant and Customer-Centric

2. Paul Hagen, “The Rise of the Chief Customer Officer,” Forbes , http://www.forbes.com/2011/02/10/chief-customer-officer-leadership-cmo-net
work-rise.html
3. Ibid.
4. Bryan Yurcan, “USAA Develops Cross-Channel Capabilities to Improve Customer Experience,” Bank Systems and Technology, http://www.banktech.com/.
22. James Manyika, Big Data: The Next Frontier for Innovation, Competition,
and Productivity , McKinsey Global Institute.
23. Ibid.
24. Jeff Bertolucci, “Big Data Skills Scarce Among Marketing Pros,” InformationWeek ,
www.informationweek.com/big-data/news/big data-analytics-big-data-skills-scarce.
25. Ibid.
26. Jeff Bertolucci, “Big Data ROI Still Tough to Measure,” InformationWeek ,
www.informationweek.com/big-data/news/big-data-analytics/big-data-roi-still-tough-to-measure/240155705.
27. Ibid.
28. Jake Wengroff, “CMO & CIO: Art + Science = Success,” CMO.com, www.cmo.com/articles/2010/9/8/cmo–cio-art–science–success.html.

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