Are You in Control of Business Strategy Drivers and Effective Decision Making?
Over the past few years, I discover more and more senior level executives who do not have a full grasp of primary business strategy drivers that drive revenue and profits. I’ve met with Chief Executive Officers (CEO) who just dismissed their Chief Marketing Officer (CMO) and asked “Why did you remove this person and what change in business activities do you seek in your next CMO?” Amazingly most can’t answer this basic question with a well thought out and rational answer. Part of the problem starts here.
Chief Financial Officers (CFO) also need to understand the details of their marketing budgets and how they can potentially affect the top line so that they can lead growth. As I’ve written here previously, the skill set of the Chief Marketing Officer has recently changed dramatically. How many companies have actually updated their CMO job specification in this manner and invested in having the rest of the senior leadership team understand how this affects their value propositions, customers, organizational chart, budgets and stakeholders? It should be every company. Yet it still remains a precious few. For companies to flourish, this needs to change.
This type of environment leads to delayed decisions or completely missing decisions about right business activities altogether. In our continually changing business world, not making the right decisions about your marketing can lead to going out of business completely in a fashion similar to Porter’s of Racine.
Executives certainly have more data than ever before. But is it relevant information in a useful format that addresses the proper business questions? Have you been lulled into a false sense of security due to buzzwords such as social media, big data and/or marketing automation? Do you have automated reports and activities to the point that you are not directly interacting with and understanding the actual granular business drivers involved in the decisions? If you can think of someone that might be having this problem but doesn’t see it, please do them a favor and send them this article and ask them to have a conversation with you about it. A long journey starts with a small first step.
Let us take a step away from business to demonstrate the point further. Captain Chelsey “Sully” Sullenberger the former US Airways pilot responsible for the “Miracle on the Hudson” landing has stated that the flight software actually prevented him from hitting the water with the nose as high as he wanted. Captain Sullenberger is now a CBS News aviation and safety consultant who speaks out against the concept of pilotless airlines. He stated in that article:
Sure, there’s a lot of “hands-off” time, but there are also many tasks that surround the management of the airplane and its computerized systems. “You’re utilizing a different skill set.”
The article then says that, “some fear that pilots rely too much on autopilots leading to a lack of practice and infrequent use of piloting skills.” So I will now ask a different but related question. Has reliance on automated marketing reports gone too far? These often measure outdated metrics, miss measuring new and emerging critical activities and possibly implemented incorrectly by technical personnel without the proper business acumen or direction? Peter Drucker warned about the potential perils of technology and the need to hire management and advisors capable of leading great business change.
Often evolving world events change not only marketing, but it also changes business models of companies and dramatically changes the competitive landscape. Can this judgment be automated? Of course not. This is a major emerging corporate governance issue for board of directors certainly needs to be asking questions regarding comprehensive understanding of the marketing activity opportunities (search engine optimization, emerging digital channels, etc) for business transformation and the risks involved of not taking action. Please ask your team the following initial questions:
- Is our revenue growing?
- Is our profit margin growing?
- Is our market share growing?
If your management team can’t answer all of the above questions with a clear yes, your team needs to reconsider your overall business strategy, pricing strategy and marketing channel execution planning and consider a much deeper set of questions to put you on the right track. Now. Today. Before it is too late. The additional questions asked by an objective outsider will be different for every business based on a variety of factors that make your business unique.