Michael Leeds, SVP, Client Engagement Americas, SGK
Some of the biggest consumer companies now have a Chief Growth Officer (CGO) reporting to the CEO on the organisation chart. These people have a daunting remit: represent the customer, energise innovation, enable positive disruption, look long-term and create a plan to get an entire company on board. Not easy. Many of these companies are only a few years into the CGO era. But trends are becoming clear, and they are instructive — for companies with, or considering, a Chief Growth Officer to initiate and deliver organic and inorganic growth by leveraging the resources of their entire organisation. So we recently talked to Michael Leeds, SGK’s Senior Vice President of Client Engagement Americas, about how to get the most out of this emerging need. At SGK, he has watched and worked with companies that have embraced the CGO role for several years now.
In a nutshell, why a CGO?
The tactics used to drive growth, especially in slow-growth product categories, no longer work for a variety of reasons. Companies are balancing innovation, disruption, managing costs and return on investment. They’re asking, “How do we connect with consumers in a more meaningful way, in real-time?” That’s why some companies see part of the CGO role as the voice of the consumer and a gateway to growth. Companies are asking, “How do we do this with fewer resources?” Especially now, with the emergence of zero-based budgeting, there’s a need to optimise resources and eliminate redundancy. Then look at the impact of technology — of social, digital, and the need to connect to consumers on their own terms. This is not new, but there simply hasn’t been a role created that says, “Let me look across the organisation and bring these disparate segments together, segments that haven’t worked together traditionally.” Integration, focus and flexibility will drive a higher return on investment.
Does this kind of rethinking tend to work?
The thinking is solid and the execution will determine its success. The need to manage complex and complicated business transformation requires a broad perspective with optimised functional alignment and allocation of resources. Think about the term “integrated marketing” — a Google Trends search shows a decline over the past 10 years, but the core idea remains valid. The route of the journey has changed, but the goals remain the same.
From your point of view, what background or temperament makes the best CGOs?
Relationship oriented with a marketing foundation. A recent Russell Reynolds Associates report noted that all the CGOs it studied had been business unit heads and “marketers who then held significant P&L responsibilities.” It’s clear that CGOs need to have the authority to influence functions that span Marketing, Sales, Innovation, Insights and R&D. And there will be conflicting agendas. So the CGO has to have the CEO’s blessing, skills and the experience to be able to broker consensus inside the organisation.
What are you seeing CGOs do that’s innovative?
They have combined innovation, marketing operations and digital into a fluid ecosystem and aligned data to drive complex, previously siloed functions. This makes perfect sense, but it’s a heavy lift in an organisation that is out of alignment on goals, strategies and tactics. But CGOs are fixing that.
Why couldn’t a pre-existing officer do this?
The CGO, given the longer-term view and scope of influence of this role, can balance interest across the organisation. For example, sales is customer-centric, but often short-term focused. They are focused on providing the retailer what they and their customers want. Marketers are consumer-centric. They have a different set of priorities and are thinking about millennials and baby boomers and how they live their life today and tomorrow. The CGO — being function-, brand-, and channel-agnostic — balances these sometimes-competing areas of focus.
How are boards and shareholder groups taking all this? Companies envision this role as having a 3-to-5-year mandate, and that’s a long time in shareholder terms.
When you see companies hit their earnings number but miss their revenue number, investors can pummel them; cost cutting the way to earnings has a limited shelf-life. Pretty soon the infrastructure to produce and market what a company makes dissipates, as do the resources and commitment to innovate. The CGO role is incremental cost, but their mandate speaks directly to something boards and shareholders should appreciate: how to make the most of your infrastructure and how to smartly answer the question, “What will consumers and customers need?”
The true cost of staying status quo is unacceptable. So you need someone with the skills, the charisma and the vision. This person has to place longer-term bets on initiatives that might not see returns for a year or more, because these take time to nurture, cultivate and evolve. As for three-to-five years — the majority of CGO hires are since 2014, so even the three-year window isn’t closed yet. Time will tell.
There’s been discussion about whether the CGO is a role that’s here to stay or whether it’s a “point-in-time” role. Why would it be the latter? Isn’t the challenge permanent?
The need for speed, agility, governance, consumer and customer centricity and sharing next- and best- practices will likely be a constant. Today’s CGO will set the course for future roles and those roles may evolve and have different titles. But now it’s the right role at the right time. I think the key function of the CGO, that will always have to exist regardless of the title, is having the support, permission, vision and skills to look well ahead, craft a plan and sell it in throughout the company. It’s the human part.
How does SGK prefer to interact with CGOs?
We provide stimuli, services and solutions for a broad range of activities that support initiatives that a CGO may be undertaking. We’re well aware that there is a top line and a bottom line, and like a CGO, look to create more with less. Content studios are a great example — why not capture video assets to feed social media at the same time the still imagery is created? Structurally, there are times when business models need to deliver greater innovation, agility, visibility and transparency across departments, influence across supply chain components for process efficiencies, here we can partner with CGOs to provide scalable resources and critical thinking.
SGK understands the value and benefit of an integrated workflow. For example, packaging art for both physical printing and e-content in one process. There is no value in keeping these two streams separate.
CPGs are increasingly turning to a new function that of the CGO, to create alignment on a corporate scale. Their great challenge is to decode the competing agendas of different functions and balance short-term and long-term goals. Successful CGOs are finding ways of leveraging different functions to bring a new agility to companies with a long history of doing things separately. We are finding that CGOs and SGK share common goals.
Michael Leeds, Senior Vice President Americas, with SGK, has been deploying brands and brand processes for more than 25 years. He evaluates brand programmes through KPIs, which provide insights into the effectiveness and efficiency of the programme’s tools, workflows, and resources. For company information, visit www.sgkinc.com and http://www.schawk.com/brand-production/packaging-e-content.
The author is a 3rd party contributor to AdAsia and this article represents his views.