CMO 2.0 Conversation with Aaron Davis, CMO at Schneider Electric

Written by on April 4, 2013 – 6:12 pm -

I truly enjoyed my CMO 2.0 Conversation with Aaron Davis, the CMO at Schneider Electric — a 170-year-old company with 24B Euros in revenue. Aaron grew up as an engineer in a family of engineers — with even his grandmothers being engineers. When he got out of school, however, he was attracted to advertising — leading to his life-long perspective that good marketing operates at the intersection of science and art. He was a co-founder at APC, which was acquired by Schneider Electric a few years ago, and subsequently named Aaron the CMO for the company.

The CMO role at Schneider Electric was created as part of an interesting transition — one in which the company transitioned from a corporate holding company with multiple sub-brands to more of a large well-recognized brand that can drive the economies of scale that allows for cross-organizational innovation needed to capitalize on fast-changing markets and opportunities.  During this transition they went from 130 different brands to 10 associated brands — brands that can keep using their name in association with the Schneider Electric brand — and a few that can keep operating on their own for competitive or market amplification reasons. Those brands that survived as associated brands had to be the number one or number two brand in their space.

At Schneider Electric they truly live their brand values as part of their organizational culture. With sustainability being a cornerstone of their brand they also happen to be one of the top 20 sustainable companies in the world. They gamefied their internal process of sustainability — resulting not only in a better bottom line, but also in a more collaborative culture, one in which people work more closely together across functional boundaries.

For Aaron, one of the most exiting changes in marketing was caused by collaborative technology — Facebook, LinkedIn, etc. Those technologies allowed for widespread intimacy — a contradiction of terms, but clearly a reality. What he is even more excited about is bringing those technologies in-house allowing his organization to compete not just on price but on agility.

Aaron has an interesting approach to making sure that new marketing channels, processes, or technologies do not lead to silos in marketing. First off, whenever something new comes on the horizon, he rarely forms a dedicated team Instead he tasks a trusted person from one of his competence centers to go and become an expert on the topic, and to report back to the team with recommendations in 3-6 months. If something becomes real he will always try to make it part of the genetics of the marketing organization, and he forces it through training and KPIs.

For example, everyone on his team is knowledgeable about SEO. He also tries to anticipate which technique or function will likely be cannibalized or eliminated if something new becomes real. He then gives that team the responsibility for the new function or the new tool — thus making cannibalization more natural and avoiding silos fighting with one another. Another technique to avoid silos it to constantly force people to have a much broader view of the marketing mix than their own area of expertise — be it demand generation, social, or events.

The advent of social media has forced a shift in marketing content development, one which Aaron describes as a shift from polished content, the way you would create a brochure, to more raw content, the way you would send an email to someone. Social amplifies raw content, not polished content.

Aaron is a firm believer in the premise that culture trumps strategy. At Schneider Electric they are trying to foster a culture that’s mostly driven by speed and a willingness to fail, but to fail fast. They also have a measurement culture, which makes for a self-correcting system. You screw up, you fix it, and you move onto the next thing.

If you do not have speed as part of your culture, and this is true especially for large companies, you can end up with situations where your strategic implementation cycle is longer than the strategy cycle itself — and you fool yourself if you think that your strategy is what the market is actually feeling.

Like with many companies that I recently interviewed, at Schneider Electric they try to have a unified corporate culture that trumps the local cultures, the age-related cultures, or any other culture layers that people bring to work.

The benefits of having a great culture include brand building, employee retention, and less failure of new employees.

Changing or creating culture in a large company is much harder than in a small company. The advantage that they have at Schneider Electric over other more unified competitors is that at those competitors it already means something to be a company person while it’s much more of a blank slate at Schneider Electric. They just need to get people to stop talking about their shared local history, great stories, and local lessons learned and instead focus on talking about the shared vision and how they are going to work moving forward.

In terms of talent acquisition, there is a generational aspect at Schneider. Many of the big problems that Schneider Electric has identified will not be solved in a year — they’re all 15 and 20 year problems. So knowing that a person’s peak in the corporate world is 40-50 years old, it is the 30-year-olds that are going to change the world.

Other things we discussed include:

  • How to change a legacy brand and make it relevant while not losing the benefits of the legacy.
  • How everything new in marketing, with the exception of the fax is additive.
  • On the use of Centers for Competence for various marketing functions.
  • The importance of depoliticizing failures and encouraging people to fail fast but document what they did so others can avoid it.
  • The importance and real benefits that companies derive when they create cultures of trust.
  • The need to measure people not just on KPIs but also on cultural traits.
  • How to develop metrics integrated success metrics to avoid friction between sales and marketing.
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