In our ongoing conversations with EMEA CMOs, the topic of organizational design and the evolution of existing structures remains top of mind. Seventy-five percent of the EMEA-based CMOs we have recently talked to are moving away from siloed country-based operations. So it was not a surprise to see that 85 percent of European CMOs have undergone an organizational change during the last 24 months. But the journey is not finished, and the destination of “perfect marketing organization” has not yet been reached.
EMEA-based CMOs are looking for ways to further drive improvements in their organizational constructs. Some are doing this in response to business drivers and others are anticipating changes. Three key business drivers emerge:
- Modernize marketing. In some organizations, marketing is still perceived as the “event and collateral function.” The CMOs are focused on installing a credible and accountable marketing engine to improve marketing’s business contribution. Often their focus is demand oriented at the early stages as the impact is tangible and well understood across other functions.
- Optimize marketing. Here the basic demand engine is in place, but CMOs are looking to drive further operational efficiencies and optimize program and people investment.
- Evolve marketing. Marketing is adapting (or responding) to changing business requirements or business models. When we probed CMOs, three sub-reasons emerged:
The first was embracing customer marketing. Many marketing organizations are investing most of their efforts on new customer acquisition and ignoring or underinvesting in customer marketing. The importance of keeping customers happy and growing the customer base is not a new notion for marketers (or even outside of marketing); however, many organizations lack a disciplined approach to customer marketing. Changing business models – e.g. moving toward SaaS or subscription-based services – require organizations to rebalance their efforts and attention. CMOs also realize that demand-oriented marketers have a different DNA from customer-oriented marketers, causing them to revisit their organizational design and formalize the creation of a customer marketing function. In SiriusDecisions’ 2016 CMO Survey, 25 percent of CMOs reported that they are adding customer-marketing related roles.
As CMOs continue transforming their organizations, one thing is certain: Marketing structures will continue to evolve. When organizational changes are done well and with a well-thought-through change management approach, they can energize and mobilize resources in effectively, but when they are done badly, they can destroy morale and negatively impact business performance.
If you’re interested in diving deeper into this topic, join us in London on September 26-27 for 2016 Summit Europe.