Holmes Report 16 Sep 2014 // 2:16PM GMT
[quote] We typically have not asked for input from CEO, CFOs and sales leaders – the very people who decide whether we’re creating value or not.[/quote] By Mark Stouse Measurement Week 2014 rolled up on the calendar this year in the midst of ongoing and unprecedented levels of business and professional disruption, making it a good time to re-examine and redefine the measurement challenge before us. [caption id="attachment_2909" align="alignright" width="150"] Mark Stouse[/caption] It’s been about four years since the Barcelona Principles were announced. Since that time, there’s been much talk and some action around the idea of standardizing how to measure activities and outcomes. But if you speak with CEOs, they expect something far more significant, and that is proof of Business Value Creation. And let’s be clear: this means substantiated impact on revenue, margin and cash flow – the building blocks of shareholder value. There was a time years ago when measurement standardization might have been what the profession needed. Today, however, it’s clearly no longer sufficient. CEO frustration with us concerning proof of impact is very near the boiling point. Given this, focusing on tactical standardization is like “fighting the last war,” and it does not meet the real challenges we face. There’s an old saying in the technology space that’s relevant here: “The call for standards is somebody’s last-ditch effort to protect a losing position.” That’s a point very much worth heeding, given that the tech industry has no peer in both being disruptive and being disrupted. They can teach us a lot:
- Start with what matters. The right metrics and analytics are critically important to the success of any venture or profession. But they must align with and support business value creation. As a profession, we have been so enmeshed in conversations about metrics and analytics that we’ve failed to address the real issue. How do we create business value for our companies, our clients, our investors? As important as they are, stuff like awareness, reputation and even lead generation cannot be ends unto themselves.
- Map to business value. The only standards of business value creation that matter are business standards. Regardless of whether you work for a public, private, for-profit or philanthropic organization, the Laws of Revenue, Margin and Cash Flow are immutable and definitive. Given that, it’s time to get real about who we are, what we do, and most importantly, how the business can monetize their investment in marketing and communications. Right now, in too many companies and agencies, the answer to that last question is insufficient. That’s horribly ironic given how much value creation we actually drive for businesses the world over.
- Enlarge the circle. Frankly, marketing and communications need to inject some hybrid vigor into our thinking about measurement, analytics and proof of business value creation. With a few exceptions, we have failed to create metrics and KPIs that mean anything to the C-suite. Why? We typically have not asked for input from CEO, CFOs and sales leaders – the very people who decide whether we’re creating value or not. And the dominant role of the agencies in these discussions typically has translated into a focus on tactical metrics because those account for most of what agencies do.
- Be ready and willing to change. For years, tech companies had a blinkered view of what the customer wanted. The result was a manic belief in “features and functions” and an “if we build it, they will come” idea of marketing. Then customers began to look past those considerations to a focus on business value creation, and everyone – vendors and IT organizations alike – had to make some difficult transitions.
- Understand what success is. It is nothing more or less than being able to show the C-suite how you are helping to drive business growth, profitability and health – using real data organized into high-integrity correlations. Anything less than that may be interesting and relevant, but it is not what the C-suite is expecting from us.
Article tagsData & Analytics measurement Measurement Week