Growth is to a business organization what oxygen is to a living organism. It is the life force of the organization. For decades, sustained profitable growth has been the linchpin of long-term business prosperity. Profitable growth creates a virtuous cycle of forces that supports and drives business success. When a company stops growing, these same forces begin to run in reverse, creating a vicious cycle that makes success difficult to achieve.
My first post of 2019 asked the question: "Have Marketers Fully Embraced the Growth Challenge?" Back in January, I answered that question this way:
"The recent research indicates that leading business growth is more of an aspirational goal than a current reality for most marketers. Overall, the studies show that most marketing leaders are still relying on conventional marketing communications tools to drive growth, and they remain much less involved in other business activities that have a significant impact on growth."
Research published this year indicates that my conclusion is still largely accurate. For example, in the February 2019 edition of The CMO Survey, respondents identified driving growth as the top challenge for marketing leaders. Yet only 43.4% of the respondents reported that the marketing function leads revenue growth in their organization. In the August 2019 edition of the survey, the percentage of respondents saying that marketing leads revenue growth dropped to 36.0%.
(Note: The CMO Survey began asking this question in August 2016. Since then, the percentage of respondents reporting that marketing leads revenue growth has ranged from a low of 29.0% to a high of 43.4%.)
This fall, the CMO Council published a strategic brief that discussed the importance of growth and the major issues surrounding growth. The brief also discussed some steps that companies need to take to successfully address the growth imperative.
How to Achieve Transformational Growth described the issues surrounding growth in emphatic terms:
"For many companies, growth is the driving force that brings it all together. Yet questions loom: Where do you find it? How do you inspire it? What hinders it? How do you invest in it? Who within the organization orchestrates and owns it?"
The CMO Council observed that many companies are addressing the growth challenge by creating new C-level positions to lead growth initiatives. The brief noted that:
- According to research by Singular, more than 21% of brands with at least $50 million in advertising spend now have chief growth officers (CGOs).
- More than 6,000 executives profiled on LinkedIn have the CGO title.
- 15,000 executives on LinkedIn report being the chief revenue officer (CRO) for their company.
- 28,000 of the executives say they are chief commercial officers (CCOs).
The CMO Council discusses three keys to maximizing growth:
- Align the functional areas of the organization that play critical roles in driving growth. This will include marketing, sales, product, customer experience, technology, and analytics.
- Create a growth culture. Nurture inclusiveness and encourage input from all organizational levels.
- Set a growth agenda that identifies attractive growth opportunities and builds a sound strategy for exploiting those opportunities.
Regardless of whether growth is led by the CEO, CMO, CGO, CRO, or CCO, companies face two distinct but related tasks when addressing the growth challenge. First, they need to identify what growth opportunities are (or can be) available to them and which of those opportunities are most attractive. And second, they need to balance short-term and long-term growth opportunities.
I'll be discussing both of these issues in upcoming posts.
Image courtesy of Mike Lawrence (CreditDebitPro.com) via Flickr CC.