and shed light on the number of CEO’s who mistrust their CMOs. He quoted John Wanamaker who famously said, “I know half the money I spend on advertising is wasted, but I can never find out which half.” … and added “this pretty much sums up how CEO’s and CFO’s think about marketing”.
Mark Mitchell called out an article on that supports how 70% of CEO’s don’t trust their Chief Marketing Officers. Read the article Mark cites at Marketing Week Article.
This reminded me of another article I recently read on new product development and innovation, based on a recently released benchmark survey, that points to some significant improvements needed in the area of NPD and innovation processes for the majority of companies. The executive management in charge of these companies must feel exactly the same about the quality and maturity of their new product development and innovation people, process, tools and investment.
Read this article by Maureen Carlson at InnovationManagement.se for yourself and register for the full report.
NPD and innovation managers, who are we kidding? We have to get faster, more efficient and have more strategic impact to gain the needed resources.
The IT person wants new software that he is sure will improve the bottom line. The operations people want to invest in the plants to improve efficiency. Sales management wants to add more salesmen. HR wants to invest in training. And then there is marketing…
I am an NPDP certified new product development professional so I have one more to add…
…and then there is new product development and innovation. These NPD requests for resources go deep and are cross organizational. Whose budget is it anyway? Many departments make convincing cases for their departmental needs however when it is cross organizational and a strategic initiative, the stakes, risks and rewards are higher and more complex. How do decisions get made? Your CEO needs your help here.
Here’s how to make your CEO a believer in spending on people, processes and tools for new product development and innovation.
1. Stop using meaningless terms, like innovation! This seems contradictory. The reason to stop using the term innovation is that it is an overused buzzword, means something different to everyone in the room, creates debate and discourse and has little discrete value without a lot more information that is rarely provided at the time the term is being tossed about the room. Stay crystallized in your message to the CEO. Talk about business results and how to get there. Innovation is not the end game. Innovation happens by the use of a group of sub-processes that produce business results.
The benchmark study, that Ms. Carlson cites, reports that a major pain point to these processes is speed (56%). Other to pain points include resource allocation to the wrong products through missing VOC data or not cutting low impact projects in favor of supporting those with higher impact (52%), and product portfolios that are not aligned well enough with company strategies and objectives resulting in ineffective decision-making (53%).
2. Get rid of the silos and align around product line strategies. Create a cross organizational team to define product line strategies. Listen to all the functional roles involved, internal and external to confirm strategic thinking. Ask customers and consumers what their biggest challenges are. Be specific. Get your organization outside of the building to see the problems customer and consumers face directly, including the CEO. Learn what the competition is doing.
4. Involve the executive management in the process. When you involve the CEO and executive management in the process at the right place and time you will find yourself doing more than asking for more money. You become an advisor and informed expert who can recommend the optimal path to achieve the strategic goal.
5. Make everything measurable and simple. The benchmark study indicated the lack of hard data provided to CEOs to make smart strategic decisions. Ms. Carlson reported on data:
…more than 80% of companies are supporting decision making with poor and/or hard to access data. This makes it difficult for leaders to make the tough decisions, such as what new initiatives to fund and which ones to kill.
Mr Mitchell stated that smart CEOs know that the data is poor and expect some bullshit when functions try to gain resources for their projects. Gone are the days..
“We have to do it” or “We’ve always done it.” Everything should have a measurable outcome.
6. Don’t underestimate cultural inertia and short term focus. Ms. Carlson reports..
More than 70% reported that their leadership is averse to risk and equates killing products with failure. In fact, overall risk aversion is growing steadily. Too few are rewarded for taking calculated risks, which is the bedrock of innovation.
Convert your CEO to be a believer in product development not a referee of squabbling siblings. Take some of these steps today and behave your way into a leadership position by improving your organization’s cross organizational performance instead of an attitude of fighting for an undeserved entitlement from a suspicious parent.
For more on the subject of product line strategies and roadmaps, see http://www.adept-plm.com.