Moving to a new sector

Many businesses are looking outside their own industries for marketing talent. This is an excellent opportunity for marketers to swap sectors and broaden their careers. But it is not easy. This extract from a report by Grant Duncan and Jonathan Harper looks at the challenges facing the transitioning marketer

Early in 2011, together with colleagues from the global Spencer Stuart Marketing Officer Practice, we interviewed 39 CMOs and a few senior hiring managers from around the world to hear their first-hand experience of making the transition to a new sector. We found that CMOs have multiple reasons for changing sectors, including the desire for personal development, the opportunity to take up a new challenge, and the drive to make a difference. CMOs who have been through the experience report that their understanding of the marketing function and what it is capable of has been amplified by working in a new sector.

Marketers who are best equipped and qualified to cross into a new industry are those who make a deliberate effort to move out of their comfort zone, stretch themselves and take the occasional risk, perhaps through an international assignment, participating in M&A activity or working on a cross-functional team. Such activities teach an individual how to learn, adapt and influence in different environments – key determinants of success for any transitioning marketer.

However, even with much thought and preparation for a move into a new sector (and the full report describes these in some detail), there are many unanticipated problems and situations. This article explores a number of these, with particular emphasis on the way companies that choose to hire outside their own sector are not always prepared for the newcomer.

Two types of obstacles

The difficulties faced by CMOs who transition across sectors fall into two main categories: relationships (winning over doubting colleagues and securing the alignment of the organisation); and industry knowledge (understanding the nature of the industry, business models and culture).

Most of the obstacles that CMOs encounter are internal. CMOs are often surprised to discover a radically different perception of marketing from what they are used to. Establishing credibility and building influence are important in any new job, but CMOs moving to a new sector are more likely to be faced with prejudice and scepticism than in many other fields. The fact that they have been recruited from outside the industry sends a signal to those inside the organisation that change is afoot, so some degree of defensiveness is to be expected.

The following quote is typical: ‘The biggest obstacle is your peers within the new business accepting you and the knowledge that you bring,’ said one CMO after entering a sector that rarely hires from outside. ‘People in this industry think marketing is just getting your coloured pencils out – it takes time to convince them that it is a real discipline rather than just a hobby.’

Another CMO had to work hard to convince the engineers in her company that marketing was a serious function – a real business driver – and that it deserved to have a seat at the table. Previously it had been no more than a support function.

Gaining the trust of peers early on is clearly vital. In companies that don’t place a high value on marketing, it can be rather an abstract term. The only answer is to deliver results and show colleagues that they have a partner who can be relied upon. ‘ “Trust me” did not work. “Prove it” worked,’ says Mary Miller, CMO of PetSmart.

Thomas Lukowsky, director, market management at Allianz Deutschland, moved into the insurance business having worked in a number of different sectors with P&G, McKinsey, Vodafone and Telefónica. ‘The internet access, digital platforms and insurance businesses all dealt in abstract products.

‘These involve long-term, contractually based customer relationships, something that people who come from fmcg often have difficulty mastering. At McKinsey I had learned to understand new business models which proved invaluable.’

Monika Schulze left her brand-development role at Unilever to become CMO of Zurich Gruppe Deutschland, part of Zurich Financial Services Group. The challenge she got from the CEO (also her mentor) was to develop a customer-centric angle to the business, while building credibility and learning the business.

Thorough analysis of the market, market research and identifying customer insights were the tools on which she based her success. ‘In this industry it is important to acknowledge that the end customer and our agents and brokers all play an important role. Having a thorough understanding of the needs of our sales people helped me to build a network quickly and be accepted by the business.’

Getting the basics right

While it is essential for a new CMO to have the unambiguous support of the CEO, this alone will not suffice.

The CMO needs to be as collaborative as possible and establish early on whether or not there is widespread internal enthusiasm for any change the CEO is seeking. If not, the CMO must avoid getting isolated, but instead be able to rely on the CEO to align expectations among senior colleagues, define what success should look like, and be clear about where marketing is going to add value.

"Most of the obstacles that CMOs encounter are internal. CMOs are often surprised to discover a radically different perception of marketing from what they are used to"

The early stages of a transition can be tense. One CMO who moved from fmcg into the telecoms sector described the first few months as follows: ‘You are the alien; you have got everybody looking at you. They don’t know what branding is, they don’t know what you are talking about a lot of the time. It’s even harder if you are walking around with handcuffs because you don’t have the right team around you.’

In addition to building relationships with peers and assembling the right team, CMOs must be smart about accumulating industry knowledge. The terminology is often baffling and the business model foreign.

John Batistich moved from Wrigley to Westfield Group, an international property group based in Australia. He said: ‘I had to be very cautious. All I did for four weeks was have meetings with as many people as I could muster and ask them four simple questions: What’s working? What’s not working yet? What’s missing? What’s possible? I recorded everything because I knew my insights were going to be most accurate early on.’ Very few obstacles are insurmountable, however. CMOs that approach the task thoughtfully and with respect for those around them will enjoy getting up to speed and gaining credibility in a completely new environment even faster. ‘Changing industries is not for the faint of heart,’ says Jody Bilney of OSI Restaurant Partners.

"In addition to building relationships with peers and assembling the right team, CMOs must be smart about accumulating industry knowledge"

‘The language is different, the centre of gravity is different, but you come in with a transferable base of skills. You have to be OK with being dumb again. It is always exciting.’

Little preparation from the company taking on new CMO

As part of Spencer Stuart’s ongoing support for the CMOs we place into new roles, we emphasise the importance of a thorough and tailored induction process. However, it is generally our experience that the induction of CMOs who transition into a new industry is at best inadequate, at worst non-existent.

With a few honourable exceptions, companies seem to give far too little thought to taking on senior-level marketing recruits, and few if any special arrangements are made for those coming in from outside the sector.

The situation is baffling. As one CMO remarked, ‘no businesses hires for failure or the status quo’. So why would a company that goes to the trouble of searching far and wide to find the right CMO who can bring fresh energy and vision to its marketing function not put every effort into providing a thorough and detailed induction?

The only plausible explanation, apart from simple neglect, is that companies either genuinely do not know what to do with the outsider, or they take the view that new hires at the C-suite level should be left to sink or swim. The latter is particularly dangerous and counter-productive.

‘Inductions have always been extremely disappointing experiences,’ said one CMO. ‘My view of the best induction is “let them drown”. No company I’ve ever worked at has truly got the induction process right.’

We heard a number of horror stories of CMOs being made to feel unwelcome, not being introduced at meetings, or being asked to make decisions without any briefing or context. ‘I just had to work it out for myself,’ said one. ‘There was no programme as such, just the CEO’s personal patronage.’ Another told us that ‘in retrospect, I would have been successful quicker had I structured my own induction’.

Yet another is convinced that his employer saw the lack of an induction programme as some kind of test: ‘They only wanted people who were highly adaptive and able to float around within the company’s culture, so they absolutely would not help me prove I was that person.’ To underline the point, fully 70% of CMOs were disappointed by their induction experience.

Fiona McAnena, global brand director of Bupa, believes that individuals need to take responsibility for their inductions. ‘People inside any organisation can be myopic; they don’t know what’s businessspecific to them, they don’t know what’s category- or industry-specific.

As a result, it’s genuinely difficult for them to give you the sort of induction you need. So it’s up to you to have the confidence to say, “I need a really thorough briefing in the basics, for example how do we make money in this business?” ’

Sholto Douglas-Home, group marketing director of Hays, believes that CMOs need to use their ingenuity and be proactive about making the induction process work for them. ‘I’m sure some companies do it really well, but I don’t think anyone lays it on a plate for you – ultimately, you’ve got to learn the business yourself; you’ve got to put yourself around.’

Grant Duncan leads Spencer Stuart’s European Marketing Officer Practice. Jonathan Harper leads the firm’s European Consumer Goods & Services Practice.

This article is an extract from the Spencer Stuart report ‘Changing Places: The challenges and benefits for CMOs of making a sector transition’, July 2011. The full report is available online at www.spencerstuart.com/research/articles/1519