Bernie Jaworski is the Drucker Chair in Management and the Liberal Arts, which is named in honor of Peter Drucker, the founder of modern management and the namesake of the Drucker School. The professorship is awarded to an internationally recognized scholar who carries on the Drucker legacy of tempering sound business practices with a commitment to social responsibility. Jaworski’s interests span a wide range of disciplines and industries. We asked him to talk about the biggest challenges facing marketing today. This is the first part of a two-part interview series.
Bernie, where does marketing stand today? I know you’ve outlined the biggest challenges for marketing in your work with the AMA. Can you tell us about these challenges?
Thanks Christian, I know we haven’t spoken for a few years, but this is a good opportunity to catch up. I’m sure there are many more challenges than this, but we came up with seven:
- What is the role of marketing and the changing role of the CMO?
- The digitization of everything. How does digitization transform the corporation or institution?
- How do you get actionable, differentiated customer insights?
- Omnichannel – how do you make it all work together?
- How do firms compete in global markets?
- How do you balance radical innovation with incremental innovation?
- The challenge of organic growth [Russ Klein—the CEO of the AMA—came up with this, and it also happens to be the topic of the book I’m working on]
So these are major issues companies are struggling with today. There certainly can be others – but this represents our best estimate of the top seven.
Let’s start with the role of marketing and the CMO. What is going on?
I think there’s a lot of ambiguity about where and how marketing can best add value to the organization 50% of the CMO’s role is not marketing. So what needs to be done? Firms like P&G have clearly defined ideas of what marketing is and how it works. But for many medical device companies, it’s still a sales support function. We need a typology of CMO roles based on industry and need. Furthermore, in many situations companies have lost “control” of their story. From one-way communication, we now have a non-stop 24/7 conversation going on, driven by the consumer. So, that raises the issue of what is the role of marketing – or the brand manager – in this situation.
Digitization and contemporary business practices?
In 1945 Peter Drucker wrote Concept of the Corporation – a stunning achievement that is still worth reading today. He spent two years of his life on the study. It was the first study of the constitution, structure, and internal dynamics of a major business. I think we are at a similar point in the history of business. The “reset” button has been pushed – and we are all going to have to look at what it means for the future. Digitization completely transforms everything. And it’s not just integration of work processes or the supply chain or the consumer – it’s everything. How do companies that understand how digitizations shape the future of their industry? GE is undergoing a radical transformation which includes not just the industrial Internet and the Internet of Things, but also how people are managed. Performance reviews used be an annual thing, for example, but now the feedback is in real-time.
And it’s not just about millennials. It’s about how workplace interactions are changing dramatically. Think for a moment about the classic 7S McKinsey framework – how are each of the 7 elements being impact by digitization?
What about customer insight?
Insight is knowing something your competitors don’t know and that you can use to your advantage. When I ask the question in the boardroom—”What do you know that others don’t know?”—there usually is a long silence. So companies need to do a better job of getting differentiated insights on their customers. How does (or should) this happen?
Omnichannel – how do you see companies meeting the challenge?
Let’s go beyond simply bricks and clicks. Most people focus too narrowly on integration between online and offline activities. These are issues that can be solved because we know what the root causes are—organizational structure, competing P&L fiefdoms, tracking technology, that sort of thing. Where things get tricky is where companies have no control – the channels drive and owned by customers. Broadly we know how the customer purchases your products. But it goes back to the explosion in complexity – how do you manage touchpoints with the customer that you don’t have any control over? Stay tuned, this is going to be very interesting.
INTERVIEW by Christian Sarkar