Transcript Who Let The Barbarians In?

Who Let The
Barbarians In?
Dr. Ajay K. Sirsi
Schulich School of Business
York University
[email protected]
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Ajay Bio
Schulich School of Business, Marketing professor
Research, writing, teaching (Exec, MBA, BBA)
 Marketing Led - Sales Driven (Trafford)
 Marketing: Real People, Real Decisions (Pearson)
 Marketing: A Roadmap to Success (2009, Pearson)
Consulting
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Royal Bank
Bayer
International Paper
Glaxo Smithkline
Imperial Oil
Manulife Financial
TELUS
Amgen
Schneider Electric
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Today’s Discussion
1 2 3
4
Current State Of The
Marketing Discipline
The Silver Lining
Implications For
Teaching And
Practice
Discussion
3
Today’s Discussion
1 2 3
4
Current State Of The
Marketing Discipline
The Silver Lining
Implications For
Teaching And
Practice
Discussion
4
Barbarian
Foreign individual or tribe whose first
language was not Greek
A Greek individual or tribe speaking Greek
crudely
The Vikings
Label for the Goths during the Gothic revolt
that put an end to the Roman Empire in 470
A.D.
Began the Dark Ages
Label for Normans during their invasion of
England
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Barbarian
Foreign individual or tribe whose first
language was not Greek
A Greek individual or tribe speaking Greek
crudely
The Vikings
Label for the Goths during the Gothic revolt
that put an end to the Roman Empire in 470
A.D.
Began the Dark Ages
Label for Normans during their invasion of
England
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Recent Experiences
Four marketing consulting projects initiated
by
CFOs
Sales
Operations
Frustration with
Lack of Marketing initiative
Marketing disconnect with customer
needs
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Recent Experiences
Member of interview panel to hire AVP of
Sales
Candidate performed well in first interview
Client’s question: can she do Marketing
as well?
Hire her for VP Marketing and Sales?
She has no formal Marketing
experience
I developed a case study for second
interview
She passed with flying colours
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Recent Experiences
Marketing function is worried
Current CEO is retiring in the fall
New CEO does not “understand”
marketing
Perused 3 years of Marketing monthly
reports
To glean Marketing’s value to corporation
What I found
What new CEO did
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Support in Literature
Anderson 1982, Day 1992, Varadarajan
1992
Webster Jr. et al. (2005)
“Financial pressures, a shift in channel
power, and Marketing’s inability to
document its contribution to business
results have combined to force reductions
in Marketing spending and influence, and
to accelerate a transfer of funds and
responsibilities to the field Sales
organization”
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Support in Literature
Response: Formation of CMO Role
The problem?
Only 50% of Fortune 1000 firms have a
CMO (Booz & Co 2004)
CMO makes no difference to firm
performance (Nath and Majajan 2008)
Multi-industry sample of 167 firms over
a 5-year period
Average CMO tenure is 23 months
(Spencer Stuart statistic cited in 2004
Harvard study)
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Why Has This Situation Occurred?
Failure to talk the same language amongst
ourselves
Marketing used synonymously with
Marketing Communications
Advertising
Marketing collateral material
Product used synonymously with Good
Marketing used to only denote activities
that generate immediate sales
Failure to objectively demonstrate value
created by Marketing
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Why Has This Situation Occurred?
Failure to understand CEO’s agenda
Arrogance
“Why do you need to know what is in our
Marketing Plan?”
Other functions have taken on traditional
Marketing roles
CFO (Couto, Heinz, and Moran 2005)
Sales (Webster Jr., Malter, and Ganesan
2005)
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Who Let The
Barbarians In?
We Did
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Today’s Discussion
1 2 3
4
Current State Of The
Marketing Discipline
The Silver Lining
Implications For
Teaching And
Practice
Discussion
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Silver Lining
Research demonstrates that Marketing is
critical for organizational success (Booz &
Co survey of 9 industries 2004; Krasnikov
and Jayachandran 2008; Nohria 2003)
Organizations want Marketing to take on
non-traditional roles: driving innovation
and cross-functional collaboration
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Silver Lining
Late 2005 survey by Prophet and IDG
Broad, customer-focused issues are
crucial drivers of business growth
Customer service and delivery
Customer experience
Advertising and promotion (1%)
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Silver Lining
Current financial meltdown is making
Marketing more attractive (WSJ)
Clients investing in marketing fundamentals
to drive business growth
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Silver Lining
CMO success is evident
IBM, Pepsi, UPS, P&G, Microsoft, GE
Key corporate decision makers
On par with other C-level executives
Shape company direction
Propel financial performance
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Today’s Discussion
1 2 3
4
Current State Of The
Marketing Discipline
The Silver Lining
Implications For
Teaching And
Practice
Discussion
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What Can We Learn From Successful
CMO’s?
Choose from 3 CMO models
Marketing Service Provider
Marketing Advisor
Driver of Growth
Understand the CEO’s agenda for driving
growth and innovation (Kumar 2004)
Establish controls
“How to market Marketing”
Develop organizational linkages
What you own
What is matrixed
What you need to informally influence
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What Can We Learn From Successful
CMO’s?
Demonstrate organization dashboards
In conjunction with CEO
Combination of financial and brand equity
metrics
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Problem Recognition
Information Search
Purchase
Consideration
Purchase Intent
Purchase
Decision
Repeat
Purchase
Decision
Source: Sirsi (2009, forthcoming) Marketing: A Roadmap to Success
•Marketing communications awareness (%)
•Brand awareness (%)
•Brand associations (qualitative)
•Brand equity (scale)
•Purchase intent (scale)
•Win rates (%)
•Sales volume ($)
•New net revenue ($)
•Customer satisfaction (scale)
•Customer retention (%)
•Customer defection (%)
•Profit as percentage of revenue (%)
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What Can We Learn From Successful
CMO’s?
Take risks
Come up with big ideas
“Marketing is about building new
businesses, finding the white space, and
leading the integration across the
organization with sales and R&D” (Hyde,
Landry, and Tipping 2004)
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Marketing
Plan
Sales & Customer Plans
Manufacturing Plan
IT Plan
HR Plan
Resource Allocation
•Capital Allocation
•Budgets
Strategic Plan
•3-5 Year Horizon
•High-level strategy
Performance Measurement
•KPM (key performance
measures)
Source: Sirsi (2005) Marketing Led – Sales Driven
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Implications For Students Are Profound
Previous
Broad marketing
experience
Understands the
customer experience and
translates into brand
strategies
Now
Move from project to
project as part of crossfunctional team
Periods in non-marketing
roles
Understands market
opportunities and value
system management
Strong knowledge of
supply chains, audience
engagement and
contracting
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Implications For Students Are Profound
Previous
Gregarious, outspoken
Works hard, plays hard
Numbers driven
Motivated by
responsibility and fear of
failure
Now
Creative, flexible, longterm goal orientation
Motivated by unstructured
environments and
corporate social
responsibility
Right-brain and left-brain
skills
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Implications For Practice And
Teaching
What we teach has to change
Less focus on terms and definitions
Broader focus on material, strategy
From NPD to innovation
From logistics to SCM
From microeconomics to pricing strategies
Customer satisfaction and brand strength
relationship to firm performance
Cross-functional linkages
Marketing – Sales linkage
Marketing ROI
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Today’s Discussion
1 2 3
4
Current State Of The
Marketing Discipline
The Silver Lining
Implications For
Teaching And
Practice
Discussion
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Ajay Contact Information
Email: [email protected]
Phone: (416) 486 – 8490
Work: Schulich School of Business at York
University, Toronto, Canada
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