CMOs: How to develop customer-centric capability

CMOs: How to develop customer-centric capability

Author, consultant, and leader of residential courses in marketing performance, Angela Hatton explains how to help the development of senior marketing managers and marketing directors so that they can better craft a strategic marketing plan.
"Without successful business performance there are limited or no resources for organisational development (OD) and eventually there may be no organisation – if it loses the competitive battle. Companies will lose touch with their customers lose business, profits and market share," says Angela Hatton, an independent consultant and author specialising in strategic management and marketing.
She continues: "Gary Hamel in Leading The Revolution says: 'irrelevancy not inefficiency is the greatest challenge facing business today'. Marketing capability is all about developing structures, processes, people and resources that will keep the organisation relevant. After decades of being focused inwardly (on what they make and deliver) the OD challenge in turning the organisation and its team outward to focus on its customers is a huge challenge with everything at stake."
Here, Hatton shares advice on how businesses can ensure their marketing directors are better equipped to take on the competition.

Why is customer-centric marketing important?

It isn't really customer-centric marketing - most marketers have always tried to be customer focused. The challenge today is about customer-centric business. In markets where customers have a choice and are well informed of that choice through the internet, business success depends on delivering a better offer than the competition.
Today's customers, across all sectors – are promiscuous, they will choose and change suppliers in order to get the deal that is most relevant and best for them. Excellent functionality or service is increasingly expected (the hygiene factors for an exchange) differentiation through the experience and relationship are much more difficult to engineer and deliver, but that is the future direction.
Gaining competitive advantage is hard; often any tangible improvements in product or service will be quickly copied so the competitive advantage is not sustainable. Professional marketers are needed because they have to be the organisations experts in targeted customers. Decision-making needs to be informed by customer insights that can be leveraged to deliver a relevant and compelling offer to targeted segments of users.
Only by knowing the customers better than the competition and then having processes and cultures that enable these insights to be used innovatively can an organisation expect to thrive.

How do you drive marketing capability?

Marketing capability is not simply about knowledge and skills of marketing teams – in fact you could have the best trained and qualified marketers in your sector and still not have world class or best-of-breed market capability.
The challenge organisations face as they strive to refocus their activity and deliver customer led strategies lies not in know-how as much as in enablement. In too many organisations marketers are relegated to a role of communications manager and sales support because they are organised in product facing (inward looking ) teams, with targets and KPIs focused around these internal activities.
Customer-led business is outwardly focused – and the marketers need to lead that external view by being organised around markets, with resources to deliver market insights and processes that help to use those insights to deliver customer-led strategy – that includes customer-led business plans (or strategic marketing plans).
So market capability is driven by aligning and developing four aspects of the organisation – ignoring any one of these dimensions will reduce the potential of any of the others to have a bottom line business impact.
HR is particularly important in addressing the challenges faced by organisations trying to improve their customer focus i.e. drive market capability – the change agendas in structure, processes and people skills are much more likely to succeed if HR is instrumental in the process.

How can a company's strategic marketing plan help them to get approval from the board/senior executives or secure lending from the bank?

Strategic marketing capability is not just strategic marketing planning, although better capability will undoubtedly help deliver more effective go-to-market plans.
A company with stronger go-to-market capability is in a better position to deliver strategies more likely to be more efficient (better and tighter customer focus) and more effective (delivering greater market impact, and so a better return on investment). Better customer insight will improve the market focus and ensure a go-to-market strategy that is a mile deep and an inch wide, instead of the more wasteful and less effective one-size-fits-all approach – a mile wide but only an inch deep.
I would expect from day one the business case to be more compelling and commercial potential more robustly assessed and quantified, but over time better metrics and a stronger track record will build confidence in the teams plans and proposals.
Angela Hatton is an independent consultant and author specialising in strategic management and marketing with a focus on helping organisations maximise the benefits of a customer-led approach to strategy, strengthening their competitive advantage and improving their return on investment. To find out how to make customer-led business a reality click here.
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