[March 29, 2004] Fortune 500 Can Free up $100 Million Each - Just in Marketing; Marketing management experts, Bouchard and Winkler, call for new structure and accountability in marketing operations SAN FRANCISCO -- Billions of dollars a year are wasted in the marketing departments of Fortune 500 companies in, paradoxically, the effort to generate revenue. While businesses have been reengineering internal processes, vertically integrating and deploying technologies, the marketing function has remained the least accountable corporate activity according to marketing management experts Johanne Bouchard and Agnieszka Winkler. Bouchard and Winkler founded a unique pay-for-performance consultancy, ValueStorm, that helps companies do more for less by improving the productivity of their marketing operations. Bouchard says companies must treat the management of the marketing function like a business and focus attention on marketing operations if they want to improve customer satisfaction, increase brand equity and produce more revenue per dollar. For the past 20 plus years, the focus of marketing has been on the creative side while marketing operations has gotten short shrift, said Bouchard. Yet marketing operations have become more complex...globalized brands, multiple acquisitions and corresponding integration challenges, increasingly multifaceted product lines and more. Typically, the marketing function is organized in departments to develop, manage and run complex global programs and campaigns, added Winkler. More often than not, though, these departments become separate silos with little coordination and frequent duplication, making it difficult to assess the effectiveness of the initiatives. As a result, marketing information and creative assets become scattered and intellectual property often is lost. Winkler blames this largely on an under appreciation of the value of the assets and a lack of processes to capture previous learning, create best practices and measure results. Only when assets and processes are aligned can Chief Marketing Officers make business decisions based on ROI. According to the CMO Council in California: Management demands to measure and quantify marketing ROI as well as justify the allocation of funds have created new benchmarks, standardized metrics, additional cost centers and sophisticated analytic models. Deciding where and how to assign dollars is now one of the most complex and time-consuming tasks facing marketing decision-makers. So what do marketers need? asked Bouchard. They need the right information and rigorous analytic tools to make business decisions, and they need streamlined processes to control marketing spends, integrate marketing messages and improve brand alignment. They also need well-defined metrics to prove the value of marketing to their CEOs. These are tools that will enable the CMO to move from a functional manager to a business leader. CMO Council board member Jan Soderstrom has noted there is an overall consensus among CMOs that techniques, methodologies, tools or software for measuring marketing results effectively do not seem to exist. It's apparent that CMOs need to know these tools exist, said Winkler. We're talking about organizational tools to call out and realign marketing resources and measure staff throughput; to provide a single, consistent overview of resources, costs and output; to diagnose breakdowns and monitor compliance; and to map marketing operations worldwide according to set objectives; among others. Tools are also being developed to help CMOs make reorganization decisions resulting from mergers and downsizing; to help centralize or decentralize as necessary; to improve the go-to-market process; cut significant time from a rollout; improve coordination and integration of initiatives and to help integrate customer care initiatives, said Bouchard. In stepping back and taking a look from the outside, the numbers associated with waste and duplication in marketing operations are astounding, said Winkler. With a $1 billion dollar marketing budget, not uncommon for these companies, we see a way to free up more than $100 million, in some cases, while improving program quality and brand equity. Bouchard and Winkler co-founded ValueStorm in 2002. Each of them have been founders of multiple companies, and their hands-on experience spans the breadth and depth of marketing disciplines, on both the corporate and agency sides. That experience includes general management at the CEO level, worldwide branding, marketing management and operations, market research, advertising and software development. Clients have included Dell, Sony, Laura Croft Tomb Raider, Accenture, Johnson & Johnson, Hewlett-Packard, Unisys and 3COM. For more information on ValueStorm, visit www.valuestorm.com. [ Back To TMCnet.com's Homepage ]