Marketing accountability – the ability to measure marketing’s contribution to corporate value – remains a crucial issue.
According to a recent study conducted by Forbes CMO and Neustar entitled “Accelerating growth through Marketing Performance Management (MPM),” senior leaders within Global 5000 companies recognize that Marketing accountability is crucial for creating shareholder value and organic business growth. This study echoes our MPM Research, which found that chief marketing officers have difficulty communicating the value of marketing to their leaders.
In order to be accountable for marketing, you must have the best alignment with your business, as well as the right data, analytics, and process skills. Yet both our research and the Forbes study found data, dashboards, measurement, and modeling to be the top skills gaps for marketing organizations in terms of MPM.
It is not surprising that 75% (of the Global 5000 CMOs surveyed) indicated that their inability to communicate, quantify, and optimize marketing’s value hurt them professionally and personally.
Some marketing organizations excel at MPM and, as a consequence, achieve better growth outcomes for the companies they represent. These high-performing marketing organizations are superior to “Campaign Producers”, “Laggards”, and “Campaign Producers II” in achieving business results and exceeding growth plans by up to 20% and more for certain business results. This elite group of marketing companies is referred to as “Value creators.”
Value Creators improve MPM efforts aggressively. How? How? Value Creators are three times more likely than other companies to function or exemplify a center of excellence (CoE).
Why Do We Need a Center of Excellence
What is a Centre of Excellence? A CoE is an organizational structure that acts as a central hub to drive governance, visibility, and accountability in a particular area. It provides leadership, promotes best practices, facilitates research, and enhances skills to drive business results.
A CoE gives the whole organization visibility on quality and performance metrics. The concept of a COE can be applied to any area of business, whether it is Manufacturing, HR, or Customer Support. A CoE’s purpose is to create standardized processes that are evidence-based and ensure high-quality results, including better customer experiences.
A Marketing CoE can help the organization implement best practices to improve internal processes, customer centricity, market leadership, and innovation.
If a marketing organization is serious about establishing a consistent approach, it must develop and document a series of standards and practices. A CoE is responsible for this work.
- Define a set of common best practices and standards for work.
- You can either guide and assist directly or indirectly, using instructional materials, templates, tools, etc., in implementing and applying these best practices and work standards.
- Create a governance system for these practices and standards.
What is the first step in creating a marketing center of excellence?
It makes sense for your Marketing CoE to focus on MPM first because of its potential impact on the business. We’ve discovered that, in our five-year experience of establishing marketing centers of excellence, there are four key success factors.
1. Nominate an executive sponsor
A marketing CoE that an executive sponsor supports will thrive and succeed. The management must commit to scheduling time for COE. A sponsor who has “skin in it” will ensure that new processes and best practices are adopted throughout the organization.
2. Define your goals and success criteria
Marketing CoEs must be clear about their purpose, success criteria, and the measures they will use. Early identification of these metrics is crucial to the success of the marketing CoE and will only allow you to track progress.
Document the CoE charter, purpose, and value the CoE will provide. After you’ve defined your goals and expectations, map out the steps to take to reach those goals.
3. Plan your initial action
The CoE should begin by focusing on…
- Review all existing tools, procedures, and policies to determine which ones are applicable to MPM and to identify any gaps that need to be filled.
- Definition of MPM methods and best practices
- Templates and tools that can be reused
- Ensure that Marketing activities and investments are aligned with business outcomes
- Selecting the right tools and providing expert advice on their use
- Reviewing and guiding all Marketing projects involving planning, metrics, and dashboards
4. Equip your staff with the right skills and tools
CoEs are more than just a nice idea. You need people with the passion, vision, and necessary skills (analytical skills, planning skills, project management skills, process/operational skills, and soft skills relating to change management, such as communication and collaboration) to facilitate Marketing’s journey to excellence. No doubt, there will be obstacles. Team members must be committed and resourceful.
Establish a process and organizational framework. Decide who will lead your CoE for Marketing, how it will run, and what each member’s role is. Document and define the processes associated with the CoE’s operation.
Bonus: Establish change-management processes
An area for improvement or business opportunity triggers a CoE. Therefore, it is a change agent by nature. As part of the process of adopting its work, the CoE must consider change management.
This repository will continue to grow as the CoE continues to develop.
In the beginning, the CoE members will be involved in all areas of marketing. As the rest of the marketing team develops the necessary skills and abilities, the active involvement of CoE members should decrease. Team members will eventually serve as mentors.
A member of the CoE should be present at every project launch as part of change management to ensure alignment, accountability, and data requirements. The CoE should be in charge of the debriefing sessions.
Why Launch a Center of Excellence in Marketing?
It takes time, energy, and resources to launch a CoE in Marketing or any other CoE. Why do it? It can be a platform to improve market differentiation, reduce costs, align, and improve quality while also increasing revenue and improving customer satisfaction.
Since 2005, centers of excellence have proven their worth. They are no longer a nice to have but a necessity for companies that want to stay competitive.
It is important to be realistic when setting goals for a COE initiative. Do not expect to have your COE up and running immediately. As the COE and marketing organization mature, you should expect that the initial recommendations will change. Remember that the main reason to encourage Marketing to function as a COE is to improve business results.
It is a good idea to hire an external consultant with expertise in the CoE’s focus area, in this case, a firm with deep experience in MPM, to streamline the process, avoid potential pitfalls, and gain insights from successful experiences with other organizations.
By bringing an objective perspective, the firm won’t get bogged by real barriers that are easily breakable. Your external consultant can also serve as a coach for the team and transfer knowledge to ensure they are able to maintain and improve your CoE with time.