Should marketing have a seat in the boardroom?
B2B big-hitters Phil Kotler, Ralph Oliva, Don Schultz, Michael Krauss and others weigh in on how a board-level presence for marketing can make a big difference
It wasn't too long ago that marketers did not have a seat at the proverbial table – the executive or c-level suite. They might be called in for presentations to company leadership and maybe an occasional board meeting, but little more.
Today, the best of both B2C and B2B marketers have that seat and bring much value to leadership conversations through their intimate understanding of markets and customers, expertise in growing profitable revenue and experience in strengthening external and internal brands.
With the right marketing leader, that's how it should be. No less than the great Peter Drucker has cited both marketing and innovation as two primary ways a company achieves its business purpose, which is to create and retain profitable customers.
Phil Kotler, professor of marketing, Kellogg School of Management
"Too few company boards have a marketing mind in attendance at the meetings. No wonder so many companies have been helplessly disrupted"
According to Spencer Stuart via Forbes, less than 1% of board seats in the Fortune 1000 have been held by active marketers. And a 2015 report by Marketing Science Institute (MSI), which reviewed publicly available information on 64,086 board members for S&P 1500 firms, found just 2.6% of board members had active marketing experience.
Though the number of marketers with board seats today is tiny, in five years I predict it will be commonplace for marketers – whether CMOs or outside marketing experts – to have board seats.
What does a typical company board look like?
I asked Phil Kotler, professor of marketing at the Kellogg School of Management at Northwestern University and the author of more than 60 books including his just-published autobiography, My Adventures in Marketing, for his opinion on the subject, and here's what he told me:
"Company boards should include people with different perspectives on what makes a company successful. A typical company board would have some lawyers, finance experts, and CEOs or executives from other companies. Your company would be smart to add a professional marketing expert to the board who could raise questions about whether the company is paying sufficient attention to changing customer, channel and competitive needs and trends. Too few company boards have a marketing mind in attendance at the meetings. No wonder so many companies have been helplessly disrupted."
Michael Krauss, president, Market Strategy Group
"...the best executive to share the ‘voice of the buyer’ at the board level is a senior executive who has served as a CMO"
Ralph Oliva, the longtime executive director of the Institute for the Study of Business Markets, the business marketing profession’s research department and think tank, sees the issue this way:
"In my view, CMOs should have board director seats because so often the customer is virtually absent at those meetings. In my past life a CEO that I revered – Jerry Junkins at Texas Instruments – always left one seat empty around his board table. He would point to it and say, ‘That's the customer, remember who we’re all working for.’"
Michael Krauss, the president of the Market Strategy Group and a longtime columnist for AMA’s Marketing News, had this to say:
"The one reason why every board should include a CMO is this: the customer of the company needs to be present at the board level and the best executive to share the ‘voice of the buyer’ at the board level is a senior executive who has served – at one point or another in their career – as a CMO."
CMOs are crucial to a company's digital transformation efforts
TJ Chung, the former CEO of Navman Wireless, former c-level exec with Brunswick and 3M and board director at Littelfuse and Mastercraft, responded this way:
“As potential and current customers are increasingly interacting with your company digitally, it's imperative there's someone in your boardroom who has the marketing insights and experience in that digital world. Good CMOs can be instrumental in injecting transformative digital marketing thinking into the company’s strategy.”
Don Schultz, professor, Northwestern University's Medill School of Journalism
"All you have to do is look at board room committees, you won’t find many areas where a current day CMO can add much"
Randall Rozin, the former global director of brand and digital marketing for Dow Corning, added his own thoughts:
“Businesses need to think creatively to develop new strategies, partnerships and use of third parties to deliver new business models and customer experiences. Parity at the product level is happening faster than ever, so marketing leadership at the board level can help connect corporate strategy to improving customer experience in new ways. Marketers can excel at a board level if they can help create relevant, differentiated and consistently well-executed customer experiences. Marketing needs to take advantage of its role as a creative force and as a steward of customer experience.”
Would CMOs add any value to c-level conversations?
Last but not least, Don Schultz, professor emeritus at Northwestern University's Medill School of Journalism and the 'father' and pioneer of the concept of integrated marketing communications, shares a different take on this question:
“For the most part, CMOs are 'specialists', and well they should be. That is, they know a lot about consumers, research, advertising, promotion and other marketing-related topics. Unfortunately, they don’t know a lot about businesses and how they work (i.e., finance, operations, compensation, manufacturing, transportation, personnel, shareholders). So, while they can contribute to discussions in the marketing area, they really can’t add much to the topics boards commonly discuss at their meetings. All you have to do is look at board room committees, you won’t find many areas where a current day CMO can add much.
"While CMOs like to think that customers, relationships, communication and other topics should drive corporate decisions, they typically aren’t major topics of board room discussion. Most boards are all about debt and structure and operations and share prices, i.e., things that they believe they can control and influence. So, even if a CMO makes it to the hallowed board room, they don’t have much of a voice simply because they can’t add much to the conversation.
"While businesses are changing, and CMOs are changing too, there is still precious little marketing people, as we view the field today, can add. I think that is why they aren’t represented on boards. That may change over time but it will require the CMO to have a much better business education and understanding than most have now. In the future, that may change but in my experience, there are precious few who are qualified.