Monday, October 4, 2010

Operational Transformation Needed to Align Marketing and IT Groups as Companies Seek Competitive Advantage

Operational change is required for corporate marketers and information technology (IT) professionals as they seek to "lead not lag" to embrace new digital marketing technologies and channels in the quest to acquire, maintain and enhance customer relationships and increase revenue, according to a new report from the CMO Council and Accenture. Another key finding of the report, titled "The CMO-CIO Alignment Imperative: Driving Revenue through Customer Relevance," is that marketing and IT executives do not believe they are highly effective partners, as they struggle to achieve common goals in the race to adopt and keep pace with rapidly evolving digital marketing capabilities.

In fact, very few marketing and IT executives surveyed for the report believe their companies are prepared to exploit the new digital channels, despite their shared conviction that technology now underpins and shapes the entire customer experience. Specifically, just 4 percent of more than 300 marketing executives and 7 percent of the more than 300 IT executives who participated in the study said their companies are very prepared to exploit digital marketing channels. Additionally, only 8 percent of marketers and 6 percent of IT executives said they believe their data and analytics are completely integrated. And nearly than one-third of marketers and IT executives alike (29 percent and 27 percent, respectively) said they are either having difficulty integrating critical analytics capabilities or believe they are not integrated at all.

As customers increased their demand for always-on access points, service options and interactive experiences, a large majority of marketing executives (78 percent) and IT executives (68 percent) said that digital marketing is important to their organizations. Yet, only one-third of marketers (35 percent) and one-fifth of IT executives (20 percent) said their companies are "heavily committed and invested" in digital marketing.

In further findings, the research reveals that both marketers and IT professionals appear to be in close agreement on the value and impact of digital channels of engagement and the strategic areas of focus for closer CMO-CIO alignment. However, challenges and roadblocks remain, as nearly two-thirds (64 percent) of marketers and half (48 percent) of IT executives said they have experienced problems or challenges with implementing marketing solutions or IT projects to further marketing effectiveness.

Both groups agree that delivering more timely and relevant transactional, behavioral and customer insight data is at the top of the list. But on the IT side, there also is a focus on automating customer interactions, improving customer care and handling, as well as furthering the use of social media for online listening and interaction. Marketers, however, said they would like IT to improve the links and alignment between functional marketing, sales and channel groups, and to deploy better marketing execution platforms and operational systems.

Neither IT nor marketing seems prepared to capitalize on investments once they have been made and implemented. Insufficient funding (cited by 59 percent of marketers) and a lack of understanding of the opportunity by senior management (cited by 46 percent of IT executives) are viewed as the primary constraints for those who were unprepared to capitalize on the opportunities. However, while marketers believe that customer insight and intelligence are critical to competitive advantage, they are finding it difficult to gain IT support for better integration and mining of disparate customer data that is often isolated and under-utilized across organizational silos.

The study found that, in the absence of top-down engagement in the digital reinvention of marketing, there is a noticeable disconnect between IT and marketing executives about who they believe is leading the digital strategy for their company. More than half (58 percent) of IT executives said they were championing, spearheading or shaping the digital agenda at their company, whereas fewer than one-fifth (19 percent) of the marketers said that the digital agendas at their companies were being shaped by IT executives. Instead, 69 percent of marketers said they were the ones in the driver's seat.

Timing, resources and support are also key constraints to a more collaborative, fluid and profitable IT-marketing relationship, as both marketing and IT executives admit to following different schedules, priorities and paths to implementation.

Further, 64 percent of marketers said implementing new solutions has been a challenge; 46 percent of marketers said marketing is not seen as a priority by the IT executives; and 44 percent of marketers said their budgets aren't big enough to execute their plans. From the technology side, 30 percent of IT executives said they lack the time and technical resources to help marketing; 39 percent of them said that marketing bypasses them and works directly with the vendor; and 31 percent said marketers hinder progress by taking control and isolating IT from solution selection, strategy or implementation.

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