CMO 2.0 Conversation with Jim Davis, CMO at SAS

Written by on February 26, 2013 – 5:50 pm -

My CMO 2.0 conversation with Jim Davis, the CMO at SAS was  insightful and covered a lot of ground. Jim grew into the CMO position through the ranks of R&D and product management — a great path for a technology company. At SAS, Jim is not only the CMO, but he also runs HR, professional services, and education; positions at the executive table that should work much more closely together than they usually do. With his responsibility, Jim can  not only focus on providing a great product experience for the customer, but also a great place to work — resulting in being Number 2 on the Great Places to Work ® list and having a 2-3% employee turnover rate in an industry that averages 20-22%.

We discussed the long term benefits of investing upfront in the employee base and how unfortunately, public companies, driven by Wall Street’s relentless search for cost-cutting,  cannot always make those investments. For Jim, there are three types of relationships: the company-customer relationship, the customer-employee relationship, and the company-employee relationship; which is where most people fall down. At SAS, they are convinced that if you can satisfy the last leg of that relationship triangle, the other two will work well as well. Or as their CEO, Jim Goodnight, says — “If the employees are happy, then the customer is happy and if the customer is happy, the business thrives.”

While the cultural SAS Way and attitude in terms of how they treat people  is the same all over the world, employees in different cultural regions have different expectations of what it means to work for an exceptional employer — hence the need to execute a little bit differently depending on where you are in the world.

Realizing that people spend the majority of their waking hours at work, they treat their employees as family. A great example of that was what happened when the global financial crisis hit in 2008. Instead of hunkering down and laying off employees, as most companies would have done, the CEO did a global webcast and said, “I want to tell you something right now: I promise you I will guarantee no one will lose their job. I just need you to look after the company, look after the expenses and continue to produce quality software and build great relationships with our customers.” As a result, employees did not rush to update their LinkedIn profiles, and instead watched out for the business — resulting in the most profitable year in SAS’s history.

Next we talked about the impact of customers becoming increasingly digital and social on marketing plans and strategies.  Gone are the days of marketing getting the message out. Instead marketers now need to focus on listening and responding to the sentiment of the crowd. Marketers no longer need to be the company advocate in the marketplace — customers will do that, — but they instead need to become the customer advocate within their company.

Next we switched to the topic of big data and big data analytics. Jim described the various big data problems companies have and mapped them out in a two-by-two matrix that includes Business Intelligence (BI) and Big Data BI, both focused on reactive analytic capability; and Big Analytics and Big Data Analytics, both focused on proactive analytic capabilities. Jim has a great blog post detailing the different big data problems that companies may have.

Big data didn’t just happen. We have always had it. What was missing was the ability to gain meaningful and actionable insights from it to allow us to proactively make future marketing, product, and customer decisions.

We also talked about the benefits of real-time analytics, which has recently become in vogue. When you can place real time analytic models in line with the process by which we’re communicating with the customer, amazing new  up-sell and cross-sell opportunities present themselves.

In a recent poll SAS did with 800 executives at their Premier Leadership Series conference, 81% of respondents said that they are not doing a good job in terms of real-time, fact-based decision making. While we are still in the early stages of maturity, big data is definitely going mainstream, often driven at the board level.

In order to truly capitalize on the promise of big data, CIO’s and CMO’s need to work hand-in-hand. A good way to make that happen is to make sure that the CIO and the CMO have shared metrics for success. If the CMO is measured on customer retention or customer response or cross-sell, up-sell, then the CIO needs to be measured on those same metrics, not uptime and fall within budget. Here again, we are in the early stages of seeing this marriage between CIO’s and CMO’s happen, with many CMO’s still going at it on their own.

Lastly, we talked about the need to develop a fact-based decision-making culture — one in which human decision making gets supported by analytics and data modelers. If the human decision maker gets replaced with analytics and modeling, then we are in for big trouble — just look at the derivatives and the subsequent financial collapse.

Other things that we discussed include:

  • We briefly reviewed the results of the Social Workplace Trust Study that Human 1.0 produced with The Great Place to Work Institute, IABC and the Society for New Communications Research.
  • How they do not differentiate between consumer brand and employee brand.
  • The benefits of not being a public company with a quarterly time horizon.
  • How SAS has a deep culture of innovation and what that means.
  • How agencies are struggling with the decision to get into data or not — with the value of how you address the customer not being available in external data.
  • How to leverage social media data as part of Big Data solutions.
  • Metrics used by the SAS CMO to gauge progress and success.

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