The key to CMO-CEO relations: Opening the box

Last month, the Wall Street Journal published an article entitled "Divide Between CMOs and CEOs Is Growing, Research Finds." In it, they offered proof that CEOs and CMOs do not see eye to eye about how things are going.

Consider:

Communication—or its absence—is a major factor in this divide.

...when asked to name their marketing departments’ primary responsibilities, only 50% of CEOs gave the same answers as their own company’s CMOs, according to [a] McKinsey survey.

The article goes on to offer reasons for this:

• An increase in marketing technology sophistication, making it harder to understand
• More "CMO-adjacent" job titles (example: "Chief Growth Officer"), which have muddied the water in terms of roles
• Fewer and fewer CEOs who have ever worked in marketing (less than 10%, according to the article)

Clearly, this is a problem. The high turnover rate among CMOs amplifies the issue, which often seems to boil down to relationship issues and lack of understanding.

There's a quote that says: "Sunlight is the best disinfectant," meaning that openness, transparency, and honesty is the best cure to society's ills. In politics, the scandal is often not the original sin, it's the cover-up that comes afterwards. In the business, we can usually say the same thing: the problem is not what we did or didn't do; rather, it's in how we communicated about it.

Let's say this: "Transparency is the best form of couples therapy"...? This applies to marriage and the relationship between CEO and CMO.

The biggest problem in this space is lack of communication. CEOs don't know what's going on in marketing. It's a black box for most of them. Money goes in, and hopefully results come out, but goodness only knows what they do over there.

We need to fix this.

One of the great business books I've read in the last few years is The Four Disciplines of Execution. It covers a lot of things, but the critical point is the difference between leading and lagging measures:

• Lagging measures: metrics that measure a result of prior effort, like a conversion rate. These measures "lag" the effort—all the effort that went into optimizing that conversation rate happened before.
• Leading measures: metrics that measure the effort itself. If you wanted to maximize your conversion rate, maybe a leading measure would be the number of A/B tests you ran in the last month? Or the number of customer journeys you mapped and analyzed? Or the number of customers you managed to get to click on a content recommendations link?

A lagging measure is a goal. A leading measure is an activity.

Guess what? You can't "do" goals. You can only do activities.

We tend to concentrate on lagging measures. But this leads us to fly blind in many cases, for the simple reason that by the time you perceive a lagging measure, there's nothing you can do about it.

I have two daughters in nursing school. They very much want to get an "A" in chemistry (BTW: as the one paying their tuition, I share this goal for them). To achieve this goal, what should their metric be?

Should they just wait around until they get a report card ? Well no, because if it shows they got a "D" in chemistry, there's nothing they can do it about then—it's a lagging measure. The time for a metric is before the semester starts, not when it ends.

What should their metrics be? How about these for leading measures:

• Complete all reading assignments within two days of assignment
• Attend a study group session twice per week
• Predict and write down 10 potential test questions per week
• Get through 25 flash cards every day

If they did those four things consistently, would that contribute to them getting an "A" in chemistry? Absolutely, it would.

So this should be a metric. This is the thing they can control—the work they do that goes into the grade, their lagging measure. They should have a weekly checklist where they see how well they performed against this metric. Did they do everything on this list for that week? Did they get three our of four? This should be a goal—performance of activities.

How does this relate to transparency and how CMOs and CEOs relate?

You need to stop just reporting performance againt goal—your lagging measure. That's not the whole story.

Bring your CEO into your activities, your leading measures. Show the CEO what you're actually doing to achieve the goal. Make them understand the activities that roll up to the goal, how your organizing is performing against them, and how you can tweak them to react to the lagging measure.

• How much content did you publish specifically based on your content consumption analytics?
• How many experiments did you execute?
• How many segments did you create from customer behavior, on which you executed an email campaign?

These are metrics. You should track these and then report them. To the entire leadership team.

Let's assume you start doing this, but your lagging measure doesn't change. You're consistently hitting your leading measure goals, but the lagging measure—the conversion rate in this example—just isn't moving.

Here's the worst case scenario: the CEO thinks to themselves, "Wow. We're clearly doing a lot of stuff. Marketing is harder than I thought."

Now, here's the best case scenario: the CEO thinks to themselves, "If Marketing is doing all this stuff ...and the conversion rate is still not moving...maybe it's not a Marketing issue after all? Maybe our strategy is off? Maybe we're overpriced? Maybe we should look somewhere else for the problem."

And this is the power of transparency.

Do not make Marketing a black box, because it's very easy to blame a black box when things don't work out. Open up the box.

Implement a content marketing platform where the CEO can clearly see all the marketing campaigns in process.

Implement a customer data platform where you can clearly show all the segments you're tracking and the activities you're doing with each of them

Implement an experimentation platform where you can show how many ways you tweaked content and experiences to try to move the needle

Implement a content analytics platform to show how customers are consuming your content and how you're specifically reacting to that in the content pipeline

Now, there's a cynical take to this: defend yourself and your team. Use tools and leading metrics to make a case that you're in the game and hitting all the activities. If the lagging metric changes, great—you did that and here's why.

If it doesn't, now at least you can have deeper conversations about why. It's not that you weren't magical enough. You can clearly prove that you Did All The Things™, so let's either change those things, or discuss the larger issues that might be at play.

Sunlight is the great disinfectant. Stop working in the dark. Your relationship with the CEO will suffer for it.