How marketers can earn their seat at the boardroom table
Azadeh Williams writes about how organisations who are serious about remaining competitive and understanding the changing nature of consumer demands need to bring marketing to the boardroom.
With the proliferation of data-driven marketing and sophisticated lead generation tactics, marketing is a critical function of any business. Marketing fuels the revenue engine of companies. Yet, while legal, accounting, IT and HR are now firmly cementing their spots in the boardroom, the marketer is still the last to join.
So, why is marketing still being treated like ‘the colouring-in department’ and CMOs rarely offered a seat at the boardroom table?
The missing piece
As early as 2013, the notion of marketers needing a seat at the boardroom was raised. The paper addressing it was issued by Australian Marketing Institute (AMI) and Deloitte. The paper was Marketing’s Role in the Boardroom – An Evaluation Framework for Boards and Directors. In it, it noted that in the age of digital disruption, boards have been far too slow to welcome marketers to the boardroom:
“For many organisations, marketing is the fuel that powers business strategy. It is intrinsic to how organisations develop and position their services and offerings, approach and deliver customer service and satisfaction. This is how they connect and communicate with other businesses and the community. Ultimately, marketing is critical to how organisations find and keep customers, make money and grow.”
Yet despite its importance, few organisations have still yet to grant marketing a seat at the boardroom table. In fact, recent reports show that only 26 percent of CMOs regularly attend board meetings. Alarmingly, according to Spencer Stuart via Forbes, less than 1 percent of board seats in the Fortune 1000 have been held by active marketers.
According to the AMI report, a reason for marketers missing at the board is there remains an absence of a ‘clear, embedded formula’ for marketing effects on business strategy success. This makes it difficult to factor into board governance and oversight.
Key tips to make marketing ‘boardroom friendly’
There’s little point in arguing for a seat when the table doesn’t understand what you’re saying. Marketers need to learn the language of the table and clearly demonstrate how marketing can add value to a business.
There are tips to ensure you’re presenting marketing to the board in the most palatable way:
- Strategy and planning: Assess the alignment of your marketing strategy with overall corporate planning and financial objectives. Marketers also need to ensure all strategic planning has comprehensively identified major marketing economic, industry and environmental threats and challenges.
- Capability and resources: Demonstrate your chosen strategy has the right resources, talent, technology and capability to support its execution.
- Marketing assets: Explain the sources and value of your marketing assets. Including your company’s brand, customer base and partner relationships
- Outcomes and objectives: Report on the right metrics and prove marketing is driving growth. Key marketing objectives and activities need to be explained to the board clearly, with results and commercial outcomes regularly shared to ensure full transparency and accountability.
- Budget and investment: Speak the financial language of the business. Make hard business cases for spending. Evaluate period performance forecasts based on planned marketing investment and assess whether proposed levels of investment in marketing assets are appropriate to realising wider business strategic plans. This is where the CFO can be your greatest ally.
Sales and marketing alignment
Marketers being at the boardroom level really is the missing part of the equation. There’s a huge opportunity for organisations to get a real competitive advantage by having marketing leaders in the boardroom mix.
But it’s time to let go of the outdated notion that only sales drives revenue. When sales and marketing integrate into a revenue pipeline, so too does the common language and metrics. This ensures that goals, initiatives and promotions are aligned across the departments. In turn demonstrating to the board the value marketing brings to business alignment and competitive advantage.