and as i think about it again…
the new organization can be very well described with exactly the famous silo metaphor.

lets take the two silos as fact. management in the one creativity/innovation in the other.
what is wrong about the picture?
nothing. because the different silos have their different climates for a reason.

what is missing in the picture? the one titan that pulls it all together? nope. (i do not believe in that person either.) what is missing are some clearly defined holes in the silo walls and a sharp process for the two different systems to interact as one.

speaking from my perspective: one problem with marketing now could be, that it has been sitting in the management silo for too long too be a key player in a two silo-world. the freedom and fun of the early days of marketing are now found somewhere else.
….the money and the women too (joking..!!!)

thanks chris for truly inspirational post and conversation.

Much of what you say I agree with, but not all. I agree that the gap between management and design as you put it–maybe epitomized best by the metaphor of the Silo Effect–is a major challenge, as is the challenge of businesses connecting with customers in meaningful ways. But I see too issues that make these very real, and even inherent, challenges that can’t be easily waved away by saying that Marketing Activities, Programs, and Events don’t matter, because they don’t matter to the customer.

First, a business in order to survive and continue to be a business, must make a profit. In order to make a profit, the company must fill a need at a cost lower than what they can charge for the solution. That means not only an intimate understanding of the customer, but an intimate understanding of the company’s resources and capabilities in the context of a changing competitive landscape. If all you do is focus on making the customer happy, you may soon find yourself mourned as the great company everyone loved, but that went bankrupt. I know that from personal–very personal–experience, having watched my marketing agency go from 40 employees to 3 partners holding on to a shoestring because the market changed and we didn’t adapt quickly enough. We provided a phenomenal client service, which in the end simply meant our clients missed us.

Second, any business larger than, say, a dozen employees, becomes a complex system. Employees are individuals, with individual experiences, outlooks and agendas. Organizing them to meet a common goal is, by definition, an endeavour to organize lots of parts and groupings of parts. No manager, no matter how magnetic or despotic can create a cohesive whole that eliminates the challenges and vicissitudes of a system comprised of independent minds. Someone in the organization must attend to the issues of making many independent parts function as a whole, and as long as we require groups of individuals to create products and solutions–whether all gathered under one corporate banner, or under a loose confederation of partners–there will always be challenges, contradictions, and frustrations to point at that make the system somewhat less than ideally efficient in serving customers and generating profits.

So I don’t disagree with you that, on the whole, businesses could be managed better, and could serve customers more wisely. But I think some form of those challenges will always be with us. Personally, my focus is on trying to be smarter about those challenges and opportunities from the standpoint of marketing’s role in the system.

Funny how that works. Remember the Rise of the CIO? The Decade of the CIO? I hope marketing doesn’t get too caught up in the pageantry around the rise of the CMO, without really digging into a solid rethinking of marketing’s role in the corporation.

CIOs today find themselves reporting to the CFO as IT is becomming a commodity.

i highly appreciate your continuous struggle with a profession that obviously is your passion too.

as you know i look at this discussion from a different point of view: firstly from europe – and then – more importantly i guess – as a design manager.

my position is the following:
if marketing is looking for somebody to team up with it always has to be the client.

to my concern your first question “What programs, activities or events do you believe…” points at the root of the evil here. – because the prize winning answer to this question is: NONE. – no program, no event, no activity… none.

looking at a company from the clients’ perspective shows you that the whole thing matters. nobody wants to be bothered with parts, loose ends or – hurray! – activities..

seriously.

right now we are experiencing very interesting organizational changes everywhere: it is the first phase of management and design melting together. in this process we discover that management is something fundamentally different than design. we see that the nature of management lies in the parts, whereas the nature of design lies in the whole. management is about approaching one goal through a number of prioritised sub-tasks. design essentially is the complete opposite: it is about making ends meet, making frictions disappear, creating personality.

the future corporation – the ueber-hyped “innovative corporation” – that everybody is so eagerly trying to shape these days will combine both the aspects of strategy and management on the one side and leadership and design on the other. it aims to combine the principles of both ‘control’ and ‘creativity’.

so, where do i see the place for marketing?
honestly?
marketing can either start to look at the whole picture through the clients’ eyes – and to possibly team up with design and the ceo.
or – yes – why not teaming up with the cfo – loosing all the rest of its old-days clamour and becoming fodder for the sales department. not a bad job either. – after all: never underestimate the power of distribution.

in other words:
in the 1950s marketing was invented as a strategy manual on how to win hearts and influence girls.
but – hey – looks like the opposite has learned to chose on its own now.
some roses, a smart opening line and polished shoes don’t quite cut it anymore.

see for yourself.

Marketing provides insight into customer value – Finance provides insight into how that value can be delivered at an economic cost that is below the price that customers are willing to pay. You were kind enough to reference my 2003 article (it was entitled “Learning to Like Each Other” and can be downloaded from http://www.structuredintuition.com/articles.html) in which I noted that Marketing’s defintion of value could be expressed as “customer benefit divided by price” and that Finance’s definition of value could be expressed as “revenue divided by economic cost”. If, for the sake of simplicity, we ignore retail margins and taxes and assume that price paid by the customer is the same as revenue to the provider, this allows the two definitions of value to be combined into a single equation for business value – “customer benefit divided by economic cost”

That is why it is so vital that Marketing and Finance learn to do more than co-exist, they must learn to collaborate. Without their active collaboration, businesses are always likely to stray too far in the direction of creating value for customers without capturing an adequate return for their shareholders, or too far in the direction of extracting financial value for shareholders but undermining their franchise with customers.

The new language of marketing (that I fully support) is all about identifying and harvesting sources of cash flow. This is a very welcome acknowledgement of, as you put it, “the fundamental business objectives” of marketing and should provide a fruitful platform for collaboration with finance.

Once marketing is recognized to be on the same page as the rest of the business, the true value of marketing’s insight into potential sources of customer value can be realized.

The marketers I see moving in that direction are really making an effort to learn the fundamentals before they try to engage finance, for reasons that Jonathan Knowles has very succinctly–and entertainingly–described in his description of the language gap between marketing and finance. I’m trying to find a link to an article he wrote describing the different interpretations of the word “Value”–where marketers instinctively define value as what the company delivers to the customer, and financiers define it as what’s delivered to the bottom line. Unless the language and outlook gap is closed, marketing and finance can sit at the table endlessly and talk in circles that never intersect. For better or worse, finance isn’t under pressure today to close that gap, but marketing is, which is why I cringe every time I hear someone in marketing say that the CFO–or sales, or IT, for that matter–just “doesn’t get it”. I think most marketers need to take a big dose of humility, and learn until they understand viscerally how the rest of the organization views their fundamental business objectives, and take on an attitude of service before they can hope to get others to see the value marketing has to offer.

A lot of marketers get annoyed with me for that opinion , but I think at the core, you’re absolutely right Carol: Marketers need to expand their view and engage other stakeholders.