I meet with dozens of marketing executives every year, and in the vast majority of these meetings, I hear frustration over an inability to effectively communicate marketing program value to the CFO. The two departments often disagree on which metrics — and which programs — are the most significant to the bottom line, as well as on the interpretation of results.
The problem is that when the chemistry isn’t just right, the personal relationship bridges aren’t strong, and the awareness of the range of solutions is limited, the collaborative spirit surrounding marketing measurement devolves quickly into a power struggle. And in that environment, everything stalls and nobody wins.
We recently had a chance to talk to a few marketers, including KeyCorp, Bank of America, Yahoo! and Home Depot, among others. Common to all was an effort to build joint ownership between marketing and finance over marketing measurement responsibility. The result seems to include setting goals that are better aligned up front with the P&L, as well as enhanced interdepartmental communication and an improved ability to interpret and act on results.
Here’s a snapshot of some of the things Marketing is doing. They:
• Build shared goals up front;
• Get up-front buy-in from Finance and corporate executives;
• Align marketing metrics with the P&L;
• Involve Finance in dashboard design;
• Provide them with full transparency;
• Give Finance partial ownership of the dashboard;
• Have the corporate scorecard mirror the LOB scorecards;
• Go beyond deciding which metrics to track to deciding how to distribute the results and to whom;
• Focus on the things that are really going to make a difference in company performance;
• Reach out to all stakeholders and LOBs and ask what’s important to them; then build in different levels for different stakeholders;
• Are realistic about trying to solve things they don’t have control over, or where there may be gaps in information; and
• Don’t leave the numbers open to interpretation; they use a narrative to explain each metric, and they publicize an action plan for the next quarter.
You can see more of this discussion online by clicking here.