Five Strategies Successful CMOs Use to Engage Their CFO
- Savvy CMOs have already realized the CFO can be their most critical organizational ally
- Strong CMO/CFO relationships help the CMO redefine the perception of marketing from a cost center to a strategic investment and P&L center
- Five keys to CMO/CFO relationships include perception of marketing, common language, marketing dashboard, collaboration and CMO as general manager
Savvy B2B CMOs know that the CFO can be their most critical organizational ally. CEOs lean heavily on their CFOs to balance and optimize operational and financial business performance and position the company to investors. Accordingly, CFOs are often the CEO’s right hand and have a great deal of corporate longevity and broad influence over functional operations and budgets.
Many CEOs and CFOs see marketing as a cost center and slush fund with discretionary budget dollars that can be cut when necessary as performance and priorities change. Sound familiar? A strong CMO/CFO relationship mitigates this view.
CMOs must engage CFOs as a real business partner year-round – not just during planning and budget season. Establishing a solid relationship with the CFO will help the CMO redefine the perception of marketing from a cost center to a strategic investment and profit center, serving both leaders with more efficient and aligned corporate growth. To effectively engage and build a strong relationship with the CFO, CMOs should use the following five strategies:
- Change the perception of marketing. CMOs must reposition marketing by presenting an agenda that drives corporate results through cross-functional alignment. Enlist the CFO as an ally, and educate him or her on the factors driving significant changes in B2B marketing and how marketing can make measureable contributions to business objectives. Shifting to and clearly communicating a data-driven, results-oriented approach aligned to corporate and sales goals is frequently the key to changing perceptions.
- Establish a common language. CFOs don’t really care about marketing tactics or how busy marketing is. What they do care about are outputs and real impacts to the business such as revenue, profit, expenses, risk, customer lifetime value, growth and valuations. CMOs must learn the language of business and be well versed in communicating how marketing investments and processes are tied to producing real business impacts. This knowledge can be gained through use of the SiriusDecisions Aligned Measurement Framework, which tracks not only activity (the most commonly reported marketing metric), but also output, impact and readiness.
- Create a marketing executive dashboard. Once a common language has been established, CMOs should partner with the CFO to create a marketing dashboard that aligns with key corporate objectives. Some tips for creating a marketing dashboard for C-suite consumption include identifying the right KPIs for marketing program areas of reputation, demand creation, sales enablement and market intelligence; tying marketing data to corporate impact metrics; providing transparent visibility into marketing successes and challenges; using data visualization and storytelling approaches to facilitate dashboard reviews; including customer-focused metrics; and providing context to link what marketing is doing today with the outputs and impacts of the future.
- Design ongoing collaboration. CMOs should establish a cadence of regular meetings and look for opportunities to collaborate with the CFO. For example, schedule ongoing dialogues – at least monthly – to discuss changing business priorities and initiatives and brainstorm potential growth strategies; invite a member of the CFO’s staff to marketing planning meetings as a business partner; budget proactively to make changes as business conditions and priorities shift; and help the CFO properly leverage the brand if he or she is responsible for investor relations and/or corporate communications. Moreover, ensure that marketing and finance staff work together to model and monitor the performance of key short- and long-term marketing campaigns and initiatives.
- Act as a general manager. CFOs appreciate CMOs who behave as general managers – applying strategic analysis, metrics and a process-based view to the marketing function’s priorities and initiatives. Countless marketing leaders have asked for more budget without first demonstrating a facile corporate stewardship of the budget dollars they were entrusted with. Track the return on marketing dollars and communicate this to the CFO. Today’s CMOs have a golden opportunity to be strategic growth leaders and strong customer advocates, and to drive efficient and effective processes, excellent cross-functional alignment, and corporate growth and profitability.
Strong CMO/CFO relationships significantly benefit overall C-suite alignment. The CFO benefits through improved understanding of, and influence over, a key function that drives P&L growth, customer relationships, risk mitigation and corporate valuation – and the CMO can leverage the relationship to reposition the marketing function as a strategic investment and profit center driving meaningful contributions toward key corporate goals.