Originally publshed by The Greater IBM Connection on October 23, 2012
Jon Iwata is IBM’s Senior Vice President, Marketing and Communications. He spoke to the Center for CIO Leadership about why close collaboration between Chief Information Officers and Chief Marketing Officers gives the best companies an edge in the marketplace.
Center for CIO Leadership: Our CIO members tell us they are facing an explosion of data from an increasing number of sources, including Social Media, and sometimes struggle to make sense of it all. How does the availability of so much data impact the marketing arena?
Jon Iwata: Essentially, we have discovered an extremely valuable natural resource — data. Marketers today recognize this. More than 1,700 CMOs interviewed by IBM said that the top three forces changing marketing are, in order of importance, the data explosion, the rise of social media, and new choices of channels and devices.
For marketers, the so-called “Big Data” phenomenon holds tremendous promise. Using analytics to extract insights from all the data, we can better understand our customers. We can market to individuals instead of to segments. We can use real-time information to predict what they’ll do or buy next. Forward-looking CMOs are beginning to move in this direction. They are changing the practice of marketing.
However, the CMOs we surveyed also said they are least prepared for these shifts. They lack the capabilities, skills and tools required to address them. As CMO of IBM, I can relate. I see the same challenges.
Center for CIO Leadership: What is driving the move toward predictive analysis of data?
Jon Iwata: Traditionally, marketers have made decisions based on historic data – what was sold, what market research told us, how campaigns performed. Today we have the tools to take advantage of real-time data – what is selling right now, how campaigns are performing right now. I would say that for most CMOs, this is where we are – somewhere between using backward-looking data and real-time data. But as we get our arms around all the data available to us – data in our enterprise systems and the vast, unstructured data outside the enterprise – we can apply analytic tools to predict customer needs and wants. You hear about this when marketers talk about “next best action” and “next best offer” and “buyer propensity” models. We are excited about this capability because it will deliver great ROI on marketing investments. And, from the perspective of the customer, we will be much more relevant and personalized when we touch them with information, an offer, an answer. They will experience marketing as a service rather than noise.
Center for CIO Leadership: Doesn’t this new capability to analyze data — and advise the other members of the C-Suite about business performance — fundamentally change the role of the CIO?
Jon Iwata: Yes, most definitely. As technology moves to the front office, the CIO will be expected to help the CMO, the CHRO, the CFO and line-of-business leaders take full advantage of these new capabilities. The CIO may not need to be a deep expert in marketing, for example, but certainly they will need to understand what CMOs are trying to build and deliver for the company. The CIO will be a partner as we build out these new capabilities – what some are calling ‘systems of engagement’ – and ensure that these systems are integrated with the rest of the company’s enterprise systems.
Center for CIO Leadership: It sounds like CIOs have to develop their business skills, as well as their technical acumen, to help lead change at their companies. What would you say are the most important qualities required from leaders today?
Jon Iwata: Great leaders must be good listeners to start with. In today’s world, they need to be role models for collaboration, bringing teams together and overcoming historical or other reasons for working in isolation. The solution to most of our business problems today relies on a strong ability to integrate — to see the bigger picture, and the perspective others bring to the table — outside one’s own domain. Very often, that collaboration opens new paths to innovate and to provide value to the organization that a single function or group can not deliver by themselves.
Center for CIO Leadership: You will be giving the keynote address at the upcoming forum in Paris where IBM invited CIOs to bring their Chief Marketing Officers along. What’s behind the new partnership between CIOs and CMOs?
Jon Iwata: Our worlds are converging. Technology is transforming how marketing is understood, practiced and led. And marketing is changing how IT will be used in the company. So, CIOs and CMOs need to work together on major initiatives like a master data management strategy, social media, and building these systems of engagement so we can reach customers through the channel or device of their choice. CIOs and CMOs will be the co-designers of their company’s total customer experience.
Center for CIO Leadership: What advice might you have for a CIO interested in forging a strong partnership with the CMO?
Jon Iwata: Seek to understand – and shape — the CMO’s agenda for transformation. Help the CMO understand where to start – for example, a master data management strategy that results in a single, accurate view of the customer as an individual. Help the CMO know what he or she doesn’t know – about security, standards and the importance of integrating marketing systems with e-commerce, CRM and other critical business systems. Understand the need for speed. CMOs and their teams operate in both short-term and long-term cycles. They will want innovative ideas from the CIO on how to deploy capabilities and iterate very quickly.
At IBM, the marketing and CIO teams are working to gather information from virtually every interaction, transaction and situation involving our clients. We want to be able to monitor what individual customers and our competition are saying about our company and our brand. In our company and in our customers’ companies, we’ve seen great success when IT experts are actually embedded in marketing organizations so that the two groups of professionals can better communicate and collaborate.
Center for CIO Leadership: You talk about the “authentic enterprise.” What do you mean by that?
Jon Iwata: One of my colleagues says that in this world of near total transparency, “how you are is who you are.” Customers, neighbors, suppliers, employees can share with the whole world what they see and experience. Of course, their first-hand experience with your brand has far more influence over people’s opinions and perceptions than any formal communication or interaction we can put into the world. An authentic enterprise, therefore, is a company that truly lives what it stands for. This is not about ethics. This is about what makes IBM, IBM – and ensuring that we are actually living up to that in every corner of our company.
Center for CIO Leadership: Thanks for taking the time to talk with us.
Jon Iwata: My pleasure.