Five Steps to Shifting Marketing's Capabilities to Meet Today's Needs
by Larry Lucas, Hilary Fazzone
Many business leaders are making important strides in transforming their marketing strategies to address changing competitive environments, emerging product and service categories, and evolving customer needs. They're thinking in terms of solutions rather than products, stakeholders rather than customers, and redefining rather than upgrading.
But, unfortunately, leaders often expect new marketing strategies to be successfully executed with old marketing capabilities. The fact is that great strategic plans have failed in the absence of capability shifts.
With the right building blocks, however, business leaders can advance their companies' marketing capabilities to give promising strategies the support needed to succeed.
What's Required
The marketing capabilities required to support meaningful business shifts fall into four key categories:
- The first category is competencies—the right functional, technical, teaming, and leadership skills to build and activate differentiating customer solutions. Such skills can be introduced in many ways, including in-house development and external talent acquisition, but they must directly align with emerging business strategies.
- The second is processes. To ensure consistent execution as teams adapt, leadership must institute replicable approaches and frameworks for the range of value-creating activities that teams undertake to deliver customer solutions.
- The third category is tools, encompassing the systems, information, assistance, resources, and metrics that teams need to work effectively. The success of tool-based capability enhancements depends largely on leadership's insight into the evolving needs of its teams, and its ability to identify the tools that address those needs.
- The final category is organization. Without the structure, governance, roles and responsibilities, and mindset that enable accountability—as well as decisive action—a business shift will flounder.
How to Get There
Building out such capabilities on such a scale requires significant time, energy, focus, and resources on the part of leadership, as well as buy-in and dedication on the part of team members. Prophet, our company, has identified five foundational methods for capability development, each of which will contribute to an emerging business strategy's chances of success.
1. Launch pilots
Introduce new capabilities or enhance current ones by starting with small, central, in-market impact examples for the rest of the organization. Take a highly regarded group that has bought into the new strategy, and usher that group through a high-visibility capability shift. Other groups will be encouraged and inspired by the pilot group's success.
2. Evolve management routines
Lead by example: Start at the top of the organization, and incorporate the solutions-shift into the way the company does business. Leadership, having actively undergone change itself, can much more effectively request change from others.
3. Promote knowledge-sharing
Asking teams to change is often insufficient. Leadership must provide examples that demonstrate what successful change looks like. By sharing best-practices from inside and outside the company, leadership will give teams a defined and proven road map to follow.
4. Develop talent
Sometimes, the capability requirements of the current business strategy will translate directly to the new strategy. But, in most cases, you'll need a new talent-development process. Talent can be fostered internally, hired externally, or some combination thereof. In any event, a system must be built to fill talent gaps and rely on relevant strengths.
5. Shape the culture and mindset
Change can be intimidating. Employees may not know where they stand relative to your emerging strategies, or whether their legacy capabilities will remain relevant as their roles evolve. To maintain focus, leaders must evolve perspectives and incite passion for transformation.
It Ain't Easy
Shifting the capabilities of a company's entire marketing function is no small undertaking. Several common pitfalls can undermine a company's efforts.
- One pitfall is allowing internal focus on the transformation to obscure the company's delivery of benefits to customers. Customers don't want to feel the growing pains of a strategy shift; they simply want to experience its positive impact. Therefore, companies should take care not to give customers a reason to look elsewhere while the kinks are worked out.
- A second pitfall is adopting a one-size-fits-all approach to capability development across the business. Some teams may have a more relevant current skill set than others, and teams will respond differently to various skill-building methods. Companies should consider each team's circumstances when designing capability-development plans.
- Another pitfall is failing to build the case for transformation internally. Leadership can be so eager to enact change, it forgets that individual team members were not part of the strategic process that brought the business shift about in the first place, and, therefore, those team members may not understand why change is necessary. Company leaders should build understanding, buy-in, and enthusiasm for the business shift if they want employees to be engaged with and energized by the change.
- Finally, leadership can underestimate the difficulty of the new business strategy, resulting in insufficient implementation resources, unattainable timelines, and unreasonable metrics for monitoring its progress. Leadership must understand and appreciate all of the requirements of a marketing capabilities shift, and create an environment that promotes its success.
But You Can Do It!
Marketing capability shifts are substantial undertakings, but they are also the lifeblood of a company's longevity, sustained relevance, and competitive differentiation. Such shifts are not only attainable but also often necessary.
Take, for example, a global adhesive manufacturer that Prophet has worked with. The company's organic growth had stalled, and historical geographic expansion was limited. In addition, the firm had minimal insight into end users' behaviors and decision-making processes. The firm was taking a reactive (rather than active) approach with competitors, and it didn't have a distinct point of view in the market. Its leaders, and Prophet, knew that better marketing could drive strategic growth.
In response, the firm embarked on a three-year strategic marketing transformation, using a marketing council that spanned the organization's divisions. The council used internal and external best-practices to identify the competencies required to "win," created a tailored way of marketing that would establish the company as a market-driven organization, developed tools and training to build key marketing competencies internally, and built processes to ensure those competencies transferred across the organization.
The result? More than 1,200 new products launched globally, resulting in nearly $1 billion in identified revenue. Margin improvements of more than $38 million resulted from a product portfolio management pilot. And specific development programs have been established for more than 400 marketers across the globe to ensure continual learning and sustainable growth.
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Many business leaders understand that strategy and capability shifts are necessary in today's dynamic environment, and that the time between such shifts is shrinking. The challenge is in navigating and executing those shifts successfully.
Putting the building blocks of competencies, processes, organization, and tools in place, and being mindful of the pitfalls, is critical to effectively spurring transformation and business growth.
Published on March 19, 2012
