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Marketing's Role in Business Strategy: Five Keys to
Success
1 August 2003—It
seems obvious that marketing would have a central role in creating and
deploying business strategy. After all, marketing is the voice of the
customer inside the company as well as the leader in communicating business
vision and priorities internally and externally. Yet too often the reality
is that marketing is marginalised from the strategy process. In a time
when companies need a compelling vision, clear priorities,
and highly focused communications, the lack of alignment between marketing
and strategy is a serious problem indeed, according to participants at
ITSMA's Inner
Circle Dinner in London last month.
Looking to remedy the
situation, participants from companies such as IBM, Xerox, and SchlumbergerSema
focused on five keys to success in bringing marketing into the centre
of business strategy:
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Identify fundamental
market trends for strategic review. Spotting the difference
between short-term waves (e.g., Year 2000 and Euro implementation)
and more lasting ‘value migrations’ that are often
driven by the maturity of the industry (e.g., business process
outsourcing) is crucial. One trend all marketers are watching is
the shift to cheaper, offshore services. The strategic question
here is whether to partner with offshore providers or build or
strengthen in-house capabilities. Another trend, somewhat less
talked about, is the shift in buying behaviour away from the CIO
and out to the business functions. On-demand computing may be another
strategic value migration. Further out, some European marketers
believe the next ‘big thing’ has to do with optimising
the use of people’s brains for better decision making!
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Give executive
management the straight story. Clearly, marketers need to help
executive management choose what issues to address. The best way
to do this is to give it to them straight--‘This is dying,
this is growing, and we’re back here–what do you want
to do?’—supported by credible information and analysis.
Highlighting past trends where opportunities were missed is also
useful. What aren’t we paying attention to today?
-
Provide a realistic
sense of competitive positioning. Deep knowledge of your company's
strengths and weaknesses vis à vis the competition is essential
to strategy. Asking ‘Can we really buy the cheapest supplier
or do we have a genuine source of differentiation?’ may be
uncomfortable, but it’s absolutely necessary. To paraphrase
Michael Porter, betting your business on the incompetence of your
competitors is not the way to provide long-term shareholder value.
-
Know when to
move on. Pulling
out of anything is perhaps the hardest choice to make because it
requires significant culture change. Refocusing can be tough too,
as any service marketer that has pushed their firm away from a
product orientation knows. But past success is no indication of
future prospects, and it is much harder to win in promising new
areas if you continue to pour time and money into the old just
because they were once successful or managers and others are most
comfortable with the status quo.
-
Drive strategic
decisions throughout the organisation. If strategic planning
has no impact on the front line, it is a useless exercise. Ensuring
that strategic decisions are not only communicated but also acted
on should be a core responsibility for marketing but one that seems
less fulfilled. One of the biggest challenges here is that strategic
change often means organisational change, and this is not something
that marketers often have the authority, skills, or inclination
to address. One key here, according to participants at the ITSMA
dinner, might be improving the relationships between marketing
and finance, since finance is always central to strategic planning.
As globalisation and
consolidation continue to pervade the technology industry, the alignment
of marketing and strategy become ever more important to business success.
It's certainly possible that executive management will simply wake up
to the need for marketers to take a more central role in strategy. More
likely, though, it is up to marketers themselves to take the initiative
on the five points outlined here.
—Bev Burgess, info@itsma.com
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About ITSMA
ITSMA specializes in helping companies market and sell services and solutions more effectively. As a membership organization, we provide research, consulting, and training to the world's leading technology, communications, and professional services providers to generate increased demand, strengthen customer relationships, and improve brand differentiation. ITSMA is based near Boston, and has offices in London and Tokyo. Learn more at www.itsma.com.
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