My CMO 2.0 Conversation with David Roman, the current Lenovo CMO, was a great one. I had spoken with the previous CMO at Lenovo and needless to say that many things have changed at Lenovo in the past few years.

Like many CMO’s I spoke with recently, David is a true marketer. He spent 14 years at Apple in a variety of marketing jobs, had a few stints with startups, and returned to the corporate world to run marketing communications for Nvidia and HP. He joined Lenovo 2 1/2 years ago.

Branding is one of the top three initiatives at Lenovo and so that was one of our first points of discussion. David explained how Lenovo, driven by the industry-wide consumerization of IT, where employees increasingly bring their own devices to work, is now trying to become a leading consumer brand — not just a B2B brand which is what they have historically been known for. To be a leading consumer technology brand means that you need to appeal and be relevant to the youth market. They are the ones that care about technology in an emotional way, and they are the ones who determine what’s cool and what’s not. According to David they are also the generation that cares the most about their brands — they expect their brands to not just enable them to do what they want to do, but also to share their social values.

To appeal to the youth market and be relevant to them, Lenovo focuses, not on the computer itself, but rather on what you can do with it. A lot of the attitude and personality of their latest branding campaign centers around celebrating the cool things that people can do with the technology. Interestingly enough, they can have a somewhat uniform campaign around the globe because they found that culturally youth have more in common with one another worldwide that they have with their local cultures.

Because consumers prefer to get their recommendations from peers rather than from companies, Lenovo had to rethink how they communicate with their audiences. David told a real cool story to illustrate his point. They have computers that will now boot up in 10 seconds and had this idea to throw a computer out of a plane with the computer controlling the parachute. If the skydiver could not boot up the computer in less than 10 seconds, there would not be enough time for the parachute to deploy and it would hit the ground. In the old days you would have faked the scene and produced the ad as cheaply as possible. They actually did the whole stunt and had two guys that had done a lot of films for MTV document how they did it. That movie went viral. So in effect they got people to watch the ad by having the meta-ad go viral. Pretty nifty if you ask me. Marketers now have to develop content in such a way that it will be used and travel as part of peer-to-peer recommendations.

Just as in past interviews, David too believes that you have to live the brand inside before you can credibly portray that brand in the marketplace. Their aim is therefore to have a unified employer and consumer brand.

David then explained his three principles of marketing. The first one being balance — with the need to balance between short term and long term impact. The second one is simplification — where the simpler something looks from the outside, the better it is. The third one is that you should always try to “wow” the customer — and they have to notice it. It has to stand out, and it has to be differentiated. If you cannot have the wow factor, don’t do it.

Next we switched to the topic of culture — a topic near and dear to Lenovo. Being a truly global company and growing through mergers and acquisitions all over the globe,  it has always been important for Lenovo to have a unified culture — they call it the Lenovo Way, which is embodied in the slogan “We do what we say and own what we do.” It is a culture of commitment and one steeped in the Human 1.0 characteristic of reciprocity. As with other successful companies that have strong internal cultures, Lenovo makes the four shared values that lead up the culture part of the annual HR review process.

As with most technology companies, innovation has always been a big part of the Lenovo culture. It has changed over time in two aspects. First, by recently becoming the leader in the marketplace, they had to start thinking about doing things differently. As a challenger you tend to focus more on execution whereas a leader you need to focus more on innovation — which also means having a different risk profile. The other cause for change is that they now want to rely on all employees and customers for innovation, not just the technology geeks in R&D.

As usual, we closed out the conversation with a discussion around metrics. At Lenovo they track the usual metrics for demand generation — number of leads, price point at which you’re selling, etc. For branding, which has a longer term consequence, they use two metrics — purchase consideration, with the goal of being in the top three, and brand premium, which looks at what percentage of the dollars you are getting in any market category.

Other things we discussed include:

• How content that you put out about your brand has to be genuine and authentic — and what that actually means
• How to let go of the need to control the message as a marketer
• How Lenovo leverages its 27,000 employees, who in many cases are also customers, as part of their marketing efforts.
• How companies have to focus on tribes rather than market segments
• The importance of keeping a balance between ongoing continuous improvement innovation and breakthrough innovations.

David Roman, CMO Lenovo [ 55:18:00 ] Play Now | Play in Popup | Download (6058)

My CMO 2.0 conversation with John Kennedy, the head of corporate marketing at IBM, was a truly great discussion. John started his marketing career at one of the best on-the-job training companies for branding — Proctor & Gamble, where he worked on some well known brands like Downy, Spic and Span, and Cinch. Following that he joined IBM’s consumer division in the mid-90s, and subsequently, spent 8 years with IBM in Tokyo in a variety of product marketing, geography marketing, and sales roles.  So, John is another true and true marketer in this ongoing series of  CMO 2.0 Conversations.

According to John, the main causes for the recent changes in marketing come from the digitization of business and the increased interconnectness of people. The fundamental change that marketing has undergone is that it has once again become a social science — it is about understanding how people connect, what they aspire to, and what motivates them to do what they do.

At IBM they use three lenses to understand how the marketing function is fundamentally changing — knowing the customer, knowing markets, and knowing audiences. In the past marketers were mostly limited to understanding their customers in terms of big demos and big psychographics. Now, big data allows marketers to understand their customer at the individual level. Big data also gives marketers the ability to serve market segments better — moving from a transactional focus to a much more customer-centric conversation around the benefits of products and services.  The last lens relates to the fact that both companies and customers now have a much higher visibility and transparency into one another’s business —  with customers who now being able to see behind the firewall and assess whether the way a company operates actually matches with what it promises through its marketing.

Like other leading marketers that I interviewed recently, John too believes that the brand is not just embedded in the promise that marketing makes about its products and services and how well those products and services deliver against that promises, but it is also embedded in the culture of the company — how the company actually behaves behind the firewall. Along those lines, IBM has done a lot of work in humanizing its brand by allowing the IBM brand to be defined by the IBMer. They see themselves as an intellectual capital company, with their employees delivering the value that gets created and offered for their customer.

Next we talked about the shifting advocacy role that marketers need to embrace. They increasingly need to take all the learnings that they develop about the customer and bring that back to the C-Suite rather than think of themselves as the corporate spokesperson in the marketplace. While marketers will continue to have the need to communicate messages to the marketplace, a majority of the content about a company’s products and services now flows through word-of-mouth.

Once again, marketers need to become more inter-disciplinary, and be concerned about more aspects of the company’s operations than they have traditionally been involved with. With the brand being impacted by so much more of the company’s operations, marketers need to think way beyond the four P’s when they think about their role. Not only do they need to become more knowledgeable, they also need to rely on more of their C-Suite counterparts to help execute the brand. And with marketing becoming increasingly technology-enabled, which is especially true of their relationship with the CIO.

Marketing in the future will not feel like marketing. It will increasingly feel like a welcome service. With marketers developing a better understanding of consumer behavior, both through social sciences and data, marketers will be able to deliver a whole new level of value to their customers. In order to so, however, marketers will need to develop a level of “digital empathy” — by not only contacting customers with the goal of achieving commercial results.

Following this conversation on the changing role of marketers, we switched to the topic of culture. According to IBM research, leading marketers are focusing more on corporate character than on the products they sell. As I said before, marketers have to become concerned with not only how a company comes across in its marketing, but how the company actually operates — and that is called culture, or in IBM parlance corporate character. Culture, of course, is the externalization of shared corporate values and beliefs.

We closed the conversation on the topic of measurements and ROI, which is increasingly tricky as marketing contributions spans both the range of hard things and soft things. Marketers are going to have to be careful to select those key analytics in this growing amount of information that best represent their contributions.

Other things that we discussed include:

• How market researchers need to shift their thinking from consumer segments to consumer tribes.
•  How to leverage social media and communities as part of marketing.
• The importance of listening to what is being said about your brand and gauge the sentiment of those conversations.
• The importance of matching internal tribes with external tribes.
• The changing need for talent within the marketing department.
• How the promise of gaining actionable insights from big data is still very much in the early stages.
• How to transition from a transactional customer relationship to one that is focused on the customer journey.
• How to balance an historic/iconic brand like IBM with having a brand that appeals to new generations and consumer tribes with the example of Smarter Planet as a platform to make that happen at IBM.

CMO 2.0 John Kennedy, IBM Play Now | Play in Popup | Download (2389)

My CMO 2.0 conversation with Phil Clement, who is the CMO at Aon was truly enlightening. Phil is an anthropologist by training with a background in econometrics as well — which makes for an interesting mix. Throughout his career, Phil has been in business development and marketing roles. He joined Aon, a $10B company operating in 120 countries, 7 years ago and recently moved to London to have better access to their worldwide operations.

Aon grew primarily though acquisitions — 419 acquisitions in fact. They range from startups to companies that have been around for more than a century — making for a rich mix of cultures, but also resulting in a tough job to brand a unified company. They built the brand from the inside out and spent more than two years making sure that everyone inside the company lived the brand promise before embarking on an external branding campaign. Phil truly believes that the 62,000 Aon employees are the ones that have the biggest impact on their brand. That is why they made the five qualities of the brand (e.g., teamwork, innovation, etc.) also an integral part of their HR system — with employees being evaluated by the same characteristics that are important to their clients. They truly “humanized” the Aon brand.

They account for local cultural difference in marketing through a program called Jazz — in which a global marketing platform gets developed and locally customized. One such platform was the sponsorship of Manchester United, one of the most recognizable soccer franchises in the world. In fact, more people have conversations about soccer than about religion, politics, and family — hard to believe. They developed a global marketing program whereby a football would go from one office to the next until it reached London, but what happened at the local offices when a football reached that office was totally localized — some might have a feast while others might have a show with native dancers for their customers. So they achieved global consistency while staying locally relevant.

Aon has not quite reached the level where they can do heavy customer segmentation based on behavior-based segmentation, which is one of the promises of big data, but they do know what makes a difference at different stages of the sales cycle.

Phil then explained how they have been moving from a more traditional insurance conversation to one that is centered on what we term “risk intelligence,” or he calls “empowering people’s decision making.” The main reason for this move is that their overall product footprint is now too large for the brand to stand for any particular offering.

Content marketing is a very important element in Phil’s marketing mix. It allows them to let the customer see how they think, it furthers their image and reputation, and it helps explain the depth with which they are approaching the problems in both risk and people. When they think about content, they use the acronym CUTT. Which is, Is the content compelling? Is it useful to the person? Is it timely? Does it lead to a transaction, or is it information about things you actually sell?

Next we delved deeper on the topic of culture. Phil being an anthropologist by training, of course, means that he focuses much of his marketing thinking on human behavior. He looks for hierarchies and symbols that dictate behavior, he looks at what gives people status and power, and always tries to understand social roles. He is also very aware of consumer cultures, and how you can sometimes influence those cultures. Internally there is a global work culture at Aon, one that emanates from their internal branding efforts mentioned earlier. Shaping culture can be very effective — in the absence of rules or the absence of a management decision, for example, culture dictates you what to do.

Lastly, we talked about the need for measuring the impact of marketing, and the difficulty associated with measuring some of the softer elements of marketing that we talked about. Phil thinks that marketing cannot be faith-based and wants to be able to measure everything. He will not embark on a program that cannot be measured. Measurement-based marketing is the only way to achieve consistency in marketing. The soft stuff, like the fact that a 15 year old will always see Aon as a big company in their life because of the Manchester United sponsorship, has to be a bonus — it cannot be the reason you embark on a marketing program. Good metrics include unification of the company, number of leads created, awareness increase, renewal rates, shortening sales cycles, etc.

Other things that we discussed include:

• The importance of excellence in marketing and branding
• What it truly means to have a team-work based culture
• The importance of having a global brand on marketing budgets
• How marketing is a mix of quantitative analysis and creative
• The findings of the Social Workplace Trust Study

CMO 2.0 Phil Clement [ 43:49:00 ] Play Now | Play in Popup | Download (1327)

My CMO 2.0 Conversation with Martine Reardon, who is the CMO at Macy’s was a great one. As usual, Martine started by describing her career path that led to becoming CMO at Macy’s. She started her career in retail early on with an internship at a local Brooklyn retailer, called A&S. During her career in retail, Martine covered just about all aspects of marketing, from PR, events, direct marketing, media buying, and analytics – so she is a real deep-rooted marketing person.

Next we discussed the biggest change that Martine has seen in the world of marketing – that of course being the shift of media into the digital space and social space. The pace at which the shift happened is astounding. The shift in technology, the shift is how people use it, and the rise of millenials all have forced marketers to challenge themselves to stay ahead of the curve.

Macy’s does an especially good job at integrating the digital space with the bricks and mortar stores. There are clearly no walls between the digital marketing efforts and the marketing efforts for the stores — it’s all one integrated branding campaign. They focus much effort in making sure that people have similar experiences online and in stores — something many companies could do a better job at. There are challenges in doing that — stores don’t have the rich navigation capabilities that online environments have, and online you cannot really recreate the richness of merchandising displays that you can have in stores. So they focus on taking best of both worlds and making sure that both worlds have the best of each other. They put technology in stores to enable customers to share potential purchases with friends, and they are making online navigation real easy by adding hints and rich media to allow the online customer to put their whole outfit together.

The next topic we tackled was branding – and how Macy’s deals with the fact that while it is a national brand, it also needs to stay locally relevant. They deal with that in three ways – through marketing, products, and local events. On the marketing front, they have dedicated regional marketers who have their own budgets. They integrate with national marketing campaigns but also add a local flavor. So, for example, while they may be marketing a national fall fashion event; California may be talking about sandals and sleeveless dresses for the fall while Oregon may be highlighting fall boots and coats. They divide up the country into cold, mild and hot for seasonal events. Another way to stay locally relevant and be a real part of the community is by celebrating local events. So, for example, they celebrate the Kentucky Derby by buying Derby hats and marketing those locally with a tie in — “Come to Macy’s for Refreshments after the Derby.”

Another marketing challenge that Macy’s faces is that while they are a national brand which has to stay locally relevant, they also need to stay relevant to different generations, different genders, different ethnic groups, and different type of buyers (e.g., value-conscious buyers vs. fashion buyers). They do this by making sure to balance the marketing calendar with big store-wide events that would appeal to all and other events that are very targeted to millenials, or the beauty customer; or just a men’s customer.

Martine then talked about how in the last three to four years they have been able to leverage customer data to come up with a better customer segmentation system. So, for example,  they can now focus on women that like to buy fragrances and jewelry versus the ones that like to buy for the home and children. They also have identified new types of customers, like the service seeker. Those are the people that want hands-on sales associate interaction. They want to be taught how to apply their makeup. They want someone bring them three different shoes, or they want someone to tell them “if you like this, you might also like this.” Another example is the practical spenders — those who, like me, just get in and out when we need to replenish something.

The promise of big data surely seems to be realized at Macy’s. Mining the rich data that they collect through many channels allows them to become more customer-centric and also to be able to focus more on the customer lifetime journey rather than just the transaction. That is especially powerful for Macy’s considering that when they start engaging with a customer at 18-19 years of age, they generally keep them for life. So, being able to follow a customer throughout their life is important — college, first job, first home, holidays, etc.

The last topic we tackled was that of balancing the iconic brand, which dates back 156 years,  with the need to develop a brand that also has a future and will appeal to future generations. Using the heritage of the brand allows them to instill trust, loyalty, and credibility in the mind of the customer. At the same time they are an entertainment brand and use their heritage in new and innovative ways to continuously be part of pop culture. A good example of this is the 85-year-old Thanksgiving Parade, which they have been able to keep new every year, with new licensed characters or new artists.

Other things that we discussed include:

• The importance of content and user generated content in marketing
• The importance of listening to customers
• How to leverage the fact that shopping is a social experience
• The importance of loyalty programs in the marketing mix

Martine Reardon, CMO Macy's [ 33:55:00 ] Play Now | Play in Popup | Download (1378)

My CMO 2.0 Conversation with Steve Pinetti, the SVP of Inspiration and Creativity at Kimpton Hotels was inspirational to say the least. Steve has been with the company since the beginning and embodies all that Kimpton stands for. He did not end up with his job by design, but by happenstance and serendipity — which is why Steve is a big believer that everyone needs to keep themselves open to possibilities. If you’re open-minded to possibilities, things will come. If you’re closed-minded, you miss.

The vision for the company came from Bill Kimpton, the founder of the company who loved travelling and staying in small hotels that had great food and good wines. From the get go, the way he managed was to empower his people to make sure that every guest had a terrific experience — no matter what it takes. That allowed them to rely on word of mouth to grow the business and to never have to focus on advertising. Steve considers it a good part of his job to make sure that the legacy of Bill Kimpton lives on as the company keeps growing and as they hire more people. His primary goal is to inspire people and make sure that the spirit of creativity is alive in everything they do — from the wake-up call to how to greet the guest at the front desk, how to say goodbye when they leave, and so on.

Kimpton is a very people-centric company which focuses first and foremost on the well-being of their employees. In fact, they don’t necessarily see themselves being in the hotel and restaurant business, they consider themselves being in the business of people. They realize that if an employee is not happy, then the guest won’t be happy and the investors won’t be happy. That is why in the last Fortune top 100 companies to work for, they came in number 16. They also realize that you can only empower people, and achieve consistent emotional connections with customers, by having a shared set of strong values, not rule books or scripts. In their case the values are: focus, passion, creativity, integrity, commitment to self-leadership and continuous improvement. All this employee-centricity leads to very low employee turnover, and very high investor returns.

At Kimpton, humanizing the brand is not an empty slogan — they truly want the personalities of their employees to come through and to be the representatives of the brand — not some faceless corporate personality. One of the important tools that they use to successfully achieve this is Kimpton University – where senior executives spend at least a quarter of their time training others. A formal mentor program in which at least 300 senior level managers are being mentored forms the other part of the investment they make in their employee commitment to continuous education. Another promise they make to their employees is that they’re going to have a safe workplace — one in which people feel comfortable coming to work and one where they feel comfortable with the people they work with.

Next we tackled the topic of creativity — which is hugely important for the company — dating back all the way to its origin. Interestingly enough, Steve is convinced that creativity can be taught. Creativity at Kimpton is focused on how to do things differently so that “when customers finally make their Kimpton stop on their journey of trying different places we want to blow their hair back, we want to stop them in their tracks.” It centers not just on big things but also on small things like what to tell the customer when they get out of the cab, or how to make the wake-up call more memorable. Everyone has to be creative at Kimpton — you cannot have employees wait for the marketing department to become creative.

Next we switched to some more traditional marketing topics — including branding. Originally Kimpton Hotels was branding every property differently — with its own style, its own restaurant and its own local environment. As they grew, and since they do cater to a business audience, they developed the need to provide customers with an umbrella brand. In developing their corporate brand they went from zero to 100 overnight and it actually resulted in a significant uplift in business — with customers now easily finding the boutique hotels they wanted, but with consistent corporate promises like being pet friendly, having kids’ programs and wellness programs.

If you doubt whether people-centricity can pay off, think again. 60% of all their first time customers are there because of word-of-mouth — that compares to 20-25% being considered successful in the industry.

Other things we talked about include:

• How to maintain a startup mentality in a 31 year old company
• How Kimpton built in guerrilla marketing as part of their culture
• A successful corporate wide ideation campaign they are currently running
• The importance of loyalty programs to focus on individual preferences

Steve Pinetti, Kimpton Hotels [ 56:27 ] Play Now | Play in Popup | Download (6194)

The CMO 2.0 conversation with Michael Mendenhall, who is currently the COO and President at Lipman and who was formally the CMO at HP and the Head of Marketing at Disney, was most informative.

Michael started his career with a small agency and later developed a rich background in corporate marketing at Disney. At HP, he learned a great deal about technology and consumer behavior, content and storytelling, and social and mobility. Most recently he became part of a group that bought Lipman, an 80 year old advertising agency, where Michael is trying to rebuild an agency with an outdated advertising model into a modern marketing, branding and digital communications consultancy.

During our conversation, Michael mentioned that one of the biggest mistakes that marketers made was to allow new media marketing to bifurcate off from the rest of the marketing group. Based on their lack of understanding on how to monetize new media, and justify ROI’s to their CFO’s and CEO’s, marketers set up  groups on the side and gave them minimal dollars to test and beta. Not only did they allow those groups to be siloed, they were also underfunded. Marketers did the same with e-cmmerce groups, which became disjointed from the people developing the corporate web site.  And they are doing it again with the social – CMO’s are once again not sure what to do with it and are under-funding those efforts in small groups on the side.  The marketing department became functionally aligned with channels – a social channel, an e-commerce channel, an m-commerce channel, etc. Agencies did the same thing, aligning themselves against those same channels – resulting in the rise of social firms, digital agencies, commerce types and mobile shops, etc. The problem with a siloed marketing department it that it forces the CMO to spend a lot of time trying to integrate all those groups so that they have one voice instead of focusing their efforts on what matters: How will I grow the business? How am I increasing share? How am I increasing margin? How am I taking share?

It also makes it difficult for the marketer to focus on the customer journey – from discovery to purchase and hopefully repeat purchase and evangelism. The customer does not think of a company as a set of siloed groups or channels and will engage with companies across all those channels at different stages of their journey. In addition, the customer will increasingly engage with touchpoints that are not controlled by the company – peers, friends and other tribal members that are out there making buying recommendations. When Lipman engages with their clients, they try to break those siloes by having every single expert at the table – the head of brand, the head of technology, the head of digital, the head of creative, and the head of media buying.

A new skill-set requirement for marketers in this digital age is the analytical skill-set – the ability to develop a 360 degree view of the customer as they go through their buying journey; the understanding that information is knowledge that gives you a competitive advantage; and the idea that raw data coming from the bricks-and-mortar transactional environments can shape R&D, as well as customer engagement, cross-sell and up-sell opportunities, and even shape customer loyalty. Most marketers do not reap the benefits from all the rich customer data that resides in their repositories. Understanding that opportunity will become as important for marketers as understanding the importance of the compelling story that will engage their customers and prospects. When CMO’s don’t have the wherewithal to deal with big data, they should team up with their CIO to make sense of it. The problem is that CIO’s often focus on storing the data, securing it and serving it up – not so much on providing services to help the business glean insights from it. At Lipman, Michael is trying to fill that gap by having his own Consumer Insights Group and by acting as a go-between between CMO’s and CIO’s. If you are interested in this topic, and are involved with Digital Marketing, you may consider taking the Digital Marketing 2.0 survey which we just launched with the Society for New Communications Research (or pass along the URL to the survey to a colleague - digitalmarketingtwo.com)

All that being said, marketing and advertising are not likely to be become pure technology plays – according to Michael – because what makes the difference is the content and the storytelling that you use to express your brand. Technology, which can be used to make us smarter about when, where, and how to engage with prospects and customers needs to be balanced with great content.

It’s important to understand culture, not only consumer cultures but also corporate cultures. For companies that have a considerable heritage that can be especially tricky. You want to build on that heritage, by pulling out those attributes of the heritage that are relevant in today’s marketplace, without building a museum out of your brand.  When it comes to consumer cultures, too many companies chase after the “cool factor” or the novelty – which can be very short-lived and which often detracts from building solutions that have a real purpose,relevancy, and are tied in with current initiatives.

On the future of how companies measure the impact of the relationship they have with their agency, Michael does not think that the push toward sharing risks and rewards will work, because agencies do not control the whole process that determines success. Marketers will need to monitor KPIs that the agency can actually affect, such as KPIs on the information side, and not the internal KPIs related to product success.

In closing Michael had the following words of wisdom for fellow marketers – don’t lose focus on the customer and their journey. While this may sound basic, with most companies being structured around functions and channels, and in some cases having the wrong skill-set,  that is not usually something that comes naturally.

Other things we talked about:

• How agencies have been successful at buying all the functional expertise through M&A’s but often failed to do a good job at the integration of all those functions.
• The importance of having stories that are authentic and transparent, because through technology the customer can see and hear almost everything you’re doing as a business
• How consumer data can give you insights into all aspects of the customer-buying journey – when they will buy, when they will leave you, etc.
• How most companies should focus on existing customers rather than new prospects that can cost as much as 10X in terms of customer acquisition cost
• How listening has to become a great shill for marketers
• How the trend towards purchasing creative through procurement is a real bad idea

CMO 2.0 Michael Mendenhall [ 51:26 ] Play Now | Play in Popup | Download (9434)

Dan Greller, the former CIO at Legg Mason, and currently technology innovation consultant, speaker and writer (with a great blog), was kind enough to join me for my second CIO 2.0 Conversation.

Dan has 30 years of experience managing global technology organizations, mostly within the financial services industry. Having first entered the job market when the debate between mainframe and desktop computing was raging, Dan has seen his share of technology innovation battles – which made it particularly interesting to discuss this latest battle between innovation and control taking place within most companies around adopting new technologies.

According to Dan, that balance between innovation and control has remained the hardest balance for CIO’s to manage. Between the increasing demands that organizations put on their IT departments and their CIO’s, the accelerating pace of change, and the ease with which employees can now bypass their IT department – that balance will become harder to manage, not easier.

The consumerization of IT, which refers to the phenomenon that consumer technology innovations are increasingly driving enterprise tools development, and also to the fact that many employees now expect their personal tools – their phone, tablet and home laptops – to work within their work environment, is clearly here to stay. The user experience that enterprise tools provide sorely lacks the experience that consumer services provide. Think of doing a Google search vs searching for content in your corporate knowledge management system, compare your corporate procurement process with the Amazon buying process, or look at how your corporate software provisioning differs from the experience you have in the iPhone or Android app stores. There is no comparison, and it is that difference in experience that leads to the consumerization of IT. CIO’s react to these forces in different ways – some say NO, and some put their head in the sand. Clearly neither one of those strategies is a workable strategy. Both will leave your users dissatisfied and relegate your IT department to irrelevance. CIO’s need to partner with key constituents and business unit owners and decide on strategic technical directions that match the culture of the company and deal with the risks associated with those strategies – human resource (HR) risks, compliance risks, legal risks, reputation risks, security risks, IP leakage risks, etc.

Risks are a thorny issue for many companies, and one that can stop innovations in their tracks. Many people, who by nature are averse to change, will hide behind potential risks, often unreal ones, to avoid having to deal with that change. In assessing risks, Dan suggests that people look at the Netflix manifesto about their culture, where they talk about a concept called the waterline. The way they look at decision-making and risk is that they think of their company as a boat, and they think of decisions being above or below the waterline. If a decision is below the waterline, then the risks of having something go wrong is much higher than if the decision is above the waterline.

We then talked about the changing role of IT and CIO’s as it relates to shifting their position from order takers to strategic business partners. CIO’s need to be the leaders who understand technologies and how they apply to the business. They need to be the ones that recommend and provide guidance on how to leverage social computing, mobility, universal access, cloud computing and “big data” as part of business processes.

Social computing should be on every CIO’s agenda, not because it’s a fad, but because eventually it will have to become part of every enterprise process and the systems that support them.

On the topic of measurements, Dan believes that there are two types of measurements – hard measurements and the anecdotal comparisons with peers. And while Dan is not a big proponent of hard benchmarks, which would require the ability to compare apples with apples, something that is virtually impossible in diverse organizations,  he does believe that comparisons with other people and companies in your industry are important. This makes sense in a competitive environment where the winner is the one that can stay ahead of the others. One of the most important measurement criteria for IT departments should be customer satisfaction, but that needs to be balanced with metrics that reflect the increasing strategic partnership that needs to exist between IT departments and the business units.

Culture trumps all and CIO’s should be thinking about culture as part of everything they do. It is what motivates people to do what they do, and it is what ultimately determines the effectiveness of all organizations. Dan believes that companies should listen to Daniel Pink when he says that people have three motivations, autonomy, mastery and purpose. They want to have a say in their destiny, they want to be recognized as a master in certain fields, and they want to be connected to a higher purpose. It’s important to have a culture that understands and promotes those values, both for your employees and also for your customers.

To create or change a corporate culture, you need to articulate where you want the culture to be, communicate it clearly with your employees, walk the talk, and reward and recognize behavior that supports that culture. The latter is especially important for IT departments, where metrics around on-time delivery and zero tolerance for failure have often stood in the way of creating a collaborative and innovative culture.

Dan ended the conversation with a few pieces of advice for IT professionals – don’t just focus on the bits and bytes, but focus on humans, their cultures and their biases; reach out to other disciplines like psychology and economics; think beyond your technical expertise when you think about the competencies that are needed to get your job done.

Well said.

Other things that we discussed include:

• How smart companies now deal with risks through a combination of education and guiderails rather than through policies alone
• The importance of e-discovery and archival systems in regulated markets
• The positive aspects of operating in regulated environments where everything gets recorded on business communications
• The importance for CIO’s to stay abreast of what happens to their industry by networking with peers
• How companies and individuals deal with innate human/cognitive biases like the confirmation bias

CIO 2.0 Conversation Dan Greller [ 1:01:16 ] Play Now | Play in Popup | Download (22002)

My first CIO 2.0 conversation with Shirley Cunningham, the CIO at Monsanto, was truly a 2.0 conversation. Shirley has a rich background. Hailing from Scotland, she held many positions in MIS departments (Management Information Systems) across various industries before joining Monsanto in the late 90′s through an acquisition. She became the global CIO 3 years ago.

As CIO at Monsanto, Shirley is a member of the strategy team. Becoming a member of the strategy team came with a change in role for  IT – that from being an order taker to a strategic partner sharing responsibility for the business’s growth. They morphed from being the implementers of ERP systems and other technologies to a team that now worries about customer space transformation though information and technology, advanced decisioning, and customer and product pipeline. And while the IT department at Monsanto supports all functions, most of its resources are dedicated to R&D and the customer space.

Being a strategic business partner rather than a support organization requires a deep understanding of the business – that is why over 35% of Monsanto’s R&D IT group has science backgrounds with 10% having PhD’s. They don’t just support the product development process – they are a key driver of it. This shift from being a more traditional IT department not only required a whole new level of leadership; it required a complete mindset shift. If you would have asked a random person in IT what they were doing a few years ago, they might have answered “I am an Oracle DBA.” Today, you are more likely to get the answer “I support a system that helps us collect $3.5B in revenue.”  People now think of their jobs in terms of the value that it delivers to the company, which is not just great for the company, but also energizing for the individuals. And therein lies a virtuous circle – when people are more energized, you have more innovation, more creativity and thus more energy and excitement.

They have a metric-driven culture. Not just one where they focus on understanding the cost of transaction and other classic metrics, but one where they measure the outcomes and values of technology usage. So they will measure the value of being able to assemble a genome on their product pipeline and their ability to commercialize products. A dedicated, and very agile, enterprise information management group helps them do that.

Word of mouth is very important in the agricultural space – with most of it happening in coffee shops. As some of those conversations are moving online, it will be very important for Monsanto to have a seat at those virtual coffee shop tables. That is one reason why Shirley thinks there is a lot of value in having employees be active in communities and social media. They are still in the early days, but plan on developing this capability in the future.

Monsanto is of course known for its culture of innovation – which is driven by its overarching goal to double the yield in agriculture within the next few years. They are passionate about innovations that impact sustainability and they think really big when it comes to their mission. This “change the world”  type attitude makes for a great innovation culture – one in which people constantly think beyond the boundaries. It also helps with the type of people they attract to the company.

Monsanto actually started an innovation lab – which is unencumbered by corporate standards – and where people can work on getting early proof of concepts. Employees first submit ideas to peer review, after which a VC-like board approves funding for further development.

Innovation at Monsanto is not contained to its corporate walls – they also co-innovate with suppliers and academia. Cross-enterprise innovation takes a lot of effort on both parties, and there always needs to be clear win for both of them.

Another interesting aspect of Monsanto’s culture is the fact that they are  non-hierarchical. They have been operating that way for 15 years and they seem to be one of the only companies that has been able to achieve this at scale. Solid lines and dotted lines like you would find in typical matrix organizations are non-existent – everyone has multiple solid lines. Those employees that come from more structured organizations take a while to get used to this non-hierarchical structure, but ultimately it makes for a great place to work. People know that they can walk in and talk to anyone, including the executives.

In closing Shirley had a few words of advice for executives at other companies – CIO’s need to step up and take ownership for things that they traditionally would not have done before so that they can have a bigger impact on the business, and they need to take more risks.

Well said – Shirley is clearly a 2.0 CIO.

Other things we talked about include:

• What worked and did not work with the “two-in-a-box” concept of pairing up a business leader with a technology leader
• The consumerization of IT and how all companies will have to be ready for that
• How they deal with risks, like IP leakage risks, through awareness and education
• The importance of being active on a local community basis while being a global company
• The role of rewards and recognition within an innovation culture
• The importance of a successful collaboration culture in an innovation culture
• The role of values and the importance of reinforcing those values to ensure a good corporate culture

CMO 2.0 Conversation with Shirley Cunningham [ 54:02 ] Play Now | Play in Popup | Download (7552)

I truly enjoyed my CMO 2.0 conversation with Karen Quintos, the CMO at Dell. Karen has somewhat of an unusual background for a CMO at a high tech company. She spent almost half her career in the pharmaceutical industry and did a stint in the financial services industry before landing at Dell 11 years ago – a rich background that was clearly reflected in the conversation. Karen also has a passion for being close to the customer – a good trait for any CMO.

We first talked about social media, a topic we had discussed at length with Erin Nelson, the previous CMO at Dell, and Manish Mehta, the VP of social media and communities, during an earlier CMO 2.0 Conversation. Karen confirmed that social media absolutely has to be built into the fabric of the company and that the (social) customer has to be at the core of everything. In fact, Karen believes that customer centricity is key to win in the marketplace. At Dell, they leverage social media as part of everything they do – product development, sales, marketing, HR, IT, finance, and service and support.

Karen then described the evolution of IdeaStorm, the Dell innovation communities, and how they now include Storm Session – focused and directed customer feedback sessions bound in time. Examples of successful Storm Sessions included discussions with CIO’s around virtualization, sustainability, and data center-type solutions – where customers could discuss how they think about ROI and total cost of ownership rather than just talk about technology deployment issues.

The Dell Social Monitoring Command Center, which was launched last year, is set up for employees to monitor, respond, and trend the conversations that are going on about Dell all over the world. On any given day they get upwards of 25,000 different conversations about Dell. A small team of people triage the conversations  by coding them red, orange or green, and feed them into processes like product development. Karen made the point that when it comes to social media monitoring companies need to realize that it should not be about hearing, but about listening and making sense.

“Leveraging social media cannot be a bolt-on strategy,” said Karen, “it has to be built into the culture…it cannot be someone’s second job, it cannot be something that they think of once a week. It has to be something that’s integrated into their day-to-day operations.” Right on! But amazing to hear that and then realize that more than 60% of those companies that participate in our Tribalization of Business Study (co-sponsored with Deloitte and the Society for New Communications Research) have 1 or less than a full time person associated with these efforts. Those companies need to wake up and listen to truly Hyper-Social organizations like Dell.

There are of course risks associated with social media. One of the early risks that Dell identified was to react too quickly – either latching on to negative comments first or latching on to proposed product ideas that very few people want. Sounds a lot like not giving in to the “tyranny of the minority” and instead reacting to real trends. Another risk they identified early on was around transparency – especially when eager employees don’t disclose that they work for Dell. Karen believes that many of the risks can be mitigated through training and education.

As many other CMO’s at successful Hyper-Social Organizations, Karen pointed to the importance of having simple values to ensure consistency across the multiple employee touch-points that they have with their customers – in their case be open, be transparent, be simple, and be caring.

Next we switched to the topic of culture, which Karen believes is, if not the most important, one of the most important elements in a company’s success. She considers Dell’s culture fairly young at 27 years old, but truly believes that is what guides behavior and brand. She also believes that it is extremely important to link your own culture(s) with that of your customers – especially in the B2B and public sector space, which make up 80% of Dell’s business.

An important part of culture is the culture of innovation. Over the last two years, Dell has fueled innovation not just from within but also through acquisitions. Interestingly enough, but not surprising (the world is not flat after all), Dell sees aquisitions from major innovation centers like Silicon Valley as being totally key to continue to bring the spirit of innovation within the company.

We closed the conversation by talking about a super-cool program that Dell is doing in partnership with the University of Texas – the Dell Social Innovation Competition. It’s open to higher education students around the world who have a passion for taking a social issue that they see within their community and coming up with a plan to address it. They submit ideas, business plans and videos which get voted on. The best ones get to travel to Austin where a finalist gets selected. With kids from India, Nigeria, France and the United States competing with one another, they are able to create a cauldron of diversity of thought necessary for innovation that would be hard to create in any corporate environment.

That is definitely something I would want to tell my 16 year old son about!

Other things we talked about include:

• The recommendation for companies to listen and engage with the both the good and the bad in social media, and how the sooner you engage the more successful you will be
• How Dell has training programs in place to teach people (9,000 people trained so far) how to listen and how to engage
• How to ensure that the proper experts get involved in deeply technical discussions
• The importance of trusting employees to do the right thing
• The importance of being able to trend conversations and launch more in-depth discussions with customers about important topics
• The importance of hiring people with a passion to win
• The importance of tying compensation and rewards to a set of behaviors – not just “what” behaviors, but also “how” behaviors
• The importance of social rewards in fostering the right culture
• The importance of employee rotational programs to foster innovation

CMO 2.0 Conversation with Karen Quintos [ 52:02 ] Play Now | Play in Popup | Download (5541)

If you want to meet a truly insightful CMO 2.0, meet Ted Smyth, the Executive Vice President, Corporate Affairs at the McGraw-Hill Companies. Ted has a really interesting background that started with a 15 year long  career as a senior Irish diplomat. He then switched over to the world of business by joining Heinz, where he spent 20 years before joining McGraw-Hill 2 years ago. One of the main lessons learned from this diverse background is that companies have to embrace performance with purpose – you don’t want to achieve profit goals at the exclusion of what’s good for society. Young people especially, will not want to leave their persona’s at the company’s front door, they will want to continue to do good for society while being at work. Another obvious benefit of mixing do-good with company performance  is that as a company you will increase the passion of your employees in the context of their work – which is clearly a win-win proposition.

We quickly delved into the topic of innovation, a hot topic at McGraw-Hill, where many of the industries in which they operate are undergoing tectonic shifts, and many of their businesses are going through the classic innovator’s dilemma. Innovation and customer focus are two major initiatives at McGraw-Hill. They strive to delight customers and prospects, and seek out people who are brilliant, courageous, curious, competitive and driven to do so – both inside and outside the organization. Innovation at McGraw-Hill is both a grass roots as well as a top down initiative, and celebrating wins, benchmarking themselves against other innovators, and developing an understanding of societal needs is all part of their culture of innovation. Ted is a firm believer that innovation needs to be structured and attached to people’s work routine. It needs to be disciplined to succeed and you always have to be on the lookout to not just innovate according to your capabilities, realizing that sometimes you need to upgrade your capabilities to develop what customers want.

Next we talked about education and learning, an important part of McGraw-Hill’s business, and a perfect example of what Ted meant when he talked about achieving business success while also doing good for society. Learning and education are clearly becoming digital activities that can help fix the current system, which is failing our kids – with kids who are slower than average falling behind and those who are faster than average getting bored. Digital courseware helps alleviate these problems. In digital environments, teachers and educators are freed up to become coaches with the ability to provide one-on-one help for the kids. While digital learning can remove some of the social barriers that sometimes inhibit learning (e.g., humiliation for not getting it), digital learning needs to be a very social/collaborative activity in order to succeed.

We then talked about the changes in how people consume content and where they get their buying recommendations from, and how that impacts marketing. The way McGraw-Hill thinks about marketing and advertising has obviously changed, with much more activity shifting towards  thought leadership and relevance in social media. Just like other Hyper-Social Organizations, McGraw-Hill realizes that you can only ensure consistency across all the different touch points that you have with your customers by living your mission and values. They have a very clear mission - need for knowledge, need for capital, need for transparency -, and a set of values that are easy to live by – objectivity, integrity, candor, diversity (especially of thought), and independence.  These simple concepts unite all employees across all divisions and help drive consistent decision-making across different markets with different customers.

Ted finished the conversation with two words of wisdom for marketers – we need to introduce more humor and emotions in communications and better articulate great societal causes. In closing he quoted some lines from an Irish poem by Nobel Laureate Seamus Heaney from the Canon of Expectation that got recited at a St. Patrick’s Day event he attended the day before our interview: “I yearn for hammerblows on clinkered planks, the uncompromised report of driven thole-pins, to know there is one among us who never swerved from all his instincts told him was right action,who stood his ground in the indicative, whose boat will lift when the cloudburst happens.” That is where we as individuals, communities and companies need to be, we need to stand our ground in the indicative, and our boat will lift when the cloudburst happen. We need firmness of purpose and be able to express it emotionally, poetically and humorously – that is where communications needs to be in order to be effective in this cluttered world.

What a great way to close a conversation with a truly great human being. Thank you Ted!

Other topics we touched on:

• The importance of the fundamentals of conflict resolution in business
• The role of training in fostering innovation
• The balance between understanding unmet needs and prospects vs existing customers needs
• The importance of serendipity in innovation
• The lessons that can be learned from game designers in education
• The need to bring down silos in stimulating innovation and learning, both in education and businesses, and the importance of social networking in doing so
• Generational differences in learning
• The importance of content curation in the publishing industry
• The dynamics of the current knowledge economy

CMO 2.0 Conversation with Ted Smyth [ 58:26 ] Play Now | Play in Popup | Download (6067)

My CMO 2.0 Conversation with Eran Barak, the SVP of Marketing and Community Strategy at Thomson Reuters was a good way to restart the series.

Eran has been involved with social technologies for a very long time, dating back to the precursor of ICQ (sold to AOL) when he was in college. He joined Thomson Reuters in 2004, just about the time when blogs and podcasts were becoming very popular – turning everyone into a content creator, and potentially a competitor. He quickly realized that social media was a great way to interpret content – and not just a way to syndicate/filter user generated content. Using the “Who Wants To Be A Millionaire” game show analogy, Eran described how social media allows financial analysts to now have three lifelines instead of one – call on experts, call on people they trust, or rely on the crowd to analyze situations.

It’s very clear that for Thomson Reuters, Social Media is all about the social and not about media – an interesting perspective coming from a company with deep media roots. They use social media to connect their customers with one another, and not to try to raise awareness about their company in the markets they operate in.

At Thomson Reuters they take the social seriously,  applying lessons learned from the wold of epidemiology and sociology to their sales and marketing processes. Specifically they leverage the friendship paradox to penetrate accounts and to make their marketing messages go viral. The friendship paradox says that if you recommend a friend, that person will be more connected (i.e., have more friends) than yourself. So by having their sales people ask prospects to recommend others within their organization that they should talk to, they get closer to the center of decision making than by navigating through the traditional hierarchies. Thinking about the social in business outside of social media is a trend that we increasingly see happen within successful organizations. Humans have always been social, but for some reason we leave our social being at the front door of our companies. Bringing that back in business the way Thompon Reuters does it with their sales force is a powerful business driver.

The two “must have” criteria for the social to succeed in financial related businesses, according to Eran, are trust (knowing that the person you are talking to is indeed who she claims to be) and security of the interaction between people (knowing that what I am talking about and sharing will only go to who I want it to go to).

We also talked about risks associated with social media and how it is better to deal with them by educating people and make them risk intelligent rather than developing policies and rule books to try to control every possible risk contingency.

Every industry is faced with accelerating change, but the ones in which Thomson Reuters operate are seeing their core foundations shift. The innovator’s dilemma is not just a periodic occurrence, it’s a constant. Eran talked about how you innovate in an environment like that – by hiring really smart people, allow them to do crazy things, and by developing a sound acquisition strategy. At Thomson Reuters, they also leverage social media to crowdsource business and product ideas with customers.

We wrapped up the conversation by talking about the fundamental changes that are happening in marketing. What is important to Thomson Reuters’ marketing is making sure that they develop content that travels among their customers and prospects. Eran truly believes that the messages that you put out in the marketplace need to be short and simple – so people can remember them and repeat them in conversations. You need to be able to distill your value proposition to one or two sentences. If you want to turn your customers into word of mouth engines, the story needs to be so unique and compelling that people want to tell their friends. If they don’t retell your story, your marketing dollar stops with the few people that are listening to you. Spending on traditional, old school advertising and marketing programs is something Eran really cannot wrap his head around in this day and age. Marketing needs to embrace simplicity and differentiate on the basis of emotion.

Eran, who truly deserves the CMO 2.0 title,  ended the conversation with some final and very valuable words of wisdom for fellow marketers – when thinking of social media, don’t start with social media (e.g., we need a Twitter feed or a Facebook page). Think through what your strategy is and then see if you can leverage social media as part of that, and ask yourself whether you can develop a message that is compelling to the point that people will want to retell it to all their friends.

In a lot of ways not all that different from what we say in our book The Hyper-Social Organization: find you tribes and what makes them tick, and engage them where they hang out.

Other things we discussed include:

• Social media in heavily regulated markets
• The importance of having social media policies that are encouraging rather than discouraging
• How you keep a good balance between providing high quality professional content and being a curator for user-generated content and how to use social filtering to deal with the increasing “infobesity”

CMO 2.0 Conversation Eran Barak [ 56:29 ] Play Now | Play in Popup | Download (5233)