It is almost a year since I wrote an article entitled CIOs: CMOs do not want your job in which I talked about the relationship between the two roles and in particular how CMOs needed their IT function to work differently to support the organisation’s digital transformation.
One of the sources I used in that article was an Accenture report that was based on a global survey of CIOs and CMOs performed in 2012. Whilst the survey found that 64% of respondents agreed with the need for alignment between marketing and IT, it also highlighted a number of issues in the relationship between the two functions. For example 34% of CMOs said that IT’s deliverables fell short of expectations, 36% stated that IT’s development process was slow and not aligned to the speed of digital marketing, and 37% said IT had a preference for building its own solution rather than integrating best-in-class solutions from vendors.
I have used Accenture’s data on the CMO perspective of IT in a number of presentations over the last 12 months to explain why IT needs to change to meet the needs of the digital business. One of the most telling findings that I have used is that 32% of CMOs said that they would prefer to buy technology as a service and not rely on their IT function. Now, that may not seem a significant number at first sight as it means that two-thirds of CMOs would prefer not to bypass their IT function. But if one in three of your organisation’s customers decided to take their business elsewhere you would be very worried; very few businesses could withstand the loss of a third of its customer base.
The Accenture survey also asks CIOs for their perspective on the relationship between IT and marketing. It is this view from both sides that makes the survey findings even more useful in explaining the need for change within IT. For example, 46% of CIOs said that marketing does not provide an adequate level of business requirements and 40% said that marketing requirements and priorities change too often. So marketing is talking about speed and flexibility but IT still wants detailed requirements and fixed priorities.
Digital markets move quickly, they are more dynamic than traditional markets and they can be disrupted more easily. To survive and succeed in the digital world, businesses need to be agile; they need to be able to respond quickly and easily to changing market conditions, customer preferences or competitor activity. The old approach to IT with its need for detailed requirements, fixed priorities and long delivery timescales are no longer fit for purpose.
Another point I make when speaking about the Accenture findings is that whilst less than half of CMOs expressed their dissatisfaction with IT, the trend is important. And I have regularly predicted that if Accenture were to repeat the survey we would see a further worsening of the position unless CIOs changed the way they and the IT function work.
Well, Accenture did repeat the survey in 2014 and I am disappointed to say that the trend is not going in the right direction for CIOs; the proportion of CMOs saying that IT’s deliverables are below expectations has increased to 40% and the number saying that IT is too slow for digital has gone up to 43%. The proportion of CMOs saying that IT prefers to build its own solutions has had increased to 40% and 38% would now prefer to deal directly with vendors.
From the IT perspective, whilst the number of CIOs saying that marketing does not provide adequate business requirements has fallen it still stands at 41% while the proportion saying that marketing requirements and priorities change too often has increased to 43%. So CMOs are becoming more dissatisfied with their IT function but an increasing number of CIOs seem to be sticking to the old ways of working that are contributing to the frustration of their marketing colleagues.
In my article from last year I talked about the threat to the IT function if it did not change; Marketing wants to collaborate with IT but only if IT changes to meet the needs of the digital business. If IT cannot or will not change, I explained, then the CMO will have no option but to deal directly with vendors.
From the 2014 results of the Accenture study, it is evident that the gap between what the Marketing function needs from the IT function and what IT provides is getting bigger and more CMOs are looking to bypass their IT function as a result. Yet CIOs do not seem able or willing to change the way IT works to meet the needs of the digital world.
The definition of insanity is doing the same thing over and over again and expecting different results. This much-used quote or variations thereof is often attributed to Einstein. I used it in a presentation I gave to the IT Directors Forum last October and thought I had better check its origin before the event. I was surprised therefore to find that there is no record of Einstein using this phrase or anything similar. The first attributable use of the phrase appears to be in a Narcotics Anonymous publication called “Basic Text” which was started in 1979 and officially released in 1981.
That somehow seems fitting in the context of CIOs, IT departments and the results of the latest Accenture survey; the IT function appears to be addicted to the ways of working, structures, etc it developed decades ago when technology and the needs of the rest of the business were so different. What else can explain the inability or refusal to change in the face of such compelling evidence that a new model for IT is required?
A year ago I ended my article stating that we needed a new model for IT that meets the needs of the digital age. The most recent Accenture survey reinforces this point. But the need for a new model is not just needed for the marketing function. Much has been written about the CIO-CMO relationship over the past year. And, if you believe some of the hype, you would think that all you had to do to become a successful digital business is get your CIO and CMO to play nicely with each other and everything else will fall into place.
There is a lot more to digital than marketing but this is where most organisations are seeing the effects of digital first. As the digital wave washes over other parts of the organisation, other functions will start to experience the same frustrations with their IT counterparts unless the CIO can transform the IT function. The current focus around the CIO-CMO relationship is an early warning to CIOs that they need to overcome their addiction to the old ways of working. IT needs to start doing things differently to produce the results required to survive in a digital world.