Competition, coexistence or symbiosis?The DNA of C-suite sales and marketing leaders

The CSO perspective

| Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective2

Technology has turned sales, and the role of the chief sales officer (CSO), upside down.

When sales teams commanded the facts, they held power over customers. Now, with the internet empowering us all, the CSO has to find a new USP. Meanwhile, customers want new terms of engagement: the ascendancy of virtual — over face-to-face — contact demands fresh ways of building customer intimacy; new communication channels and techniques and the central role of big data call for greater technical skills; and the drive for a positive customer experience requires sales to work more collaboratively with the wider value chain.

Industry-leading CSOs are thriving on such challenges to push forward the frontiers and role of the sales chief. However, an EY survey of more than 800 sales and marketing leaders and C-suite executives, along with over 20 in-depth interviews, shows many CSOs are resisting new thinking, techniques and technology.

The research, explored further in Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders, offers valuable insights into what successful sales leaders must do and be today.

3 Meet today’s CSO

4 The evolution imperative

5 Meeting customer needs

6 Are you on track to be a leading CSO?

7 Board relationships

8 Outperforming the CMO

9 The smart CSO

10 Delivering a superior customer experience

11 Appendix

800 sales and marketing leaders and C-suite executives

20 in-depth interviews

In th

is p

ersp

ectiv

e

27%

5 years

44

In the role for 4.66 years

14%

37%

66%

59%

40%

68%

CEO 79%

63%CCO

Key clients

Customerrelationships

Teamleadership

Customer relationships and team leadership are two of the top four things that make the job worthwhile

Just 39% are satisfied with their work-life balance

of CSOs are women

year-old male

hold a master’s degree

are board members

expect to be in the same role in five years

get most satisfaction when measured on their own performance

see personal restraints as the biggest barrier to development

Most important career influencers

Building a successful salesforce is the primary way

they add value

The ability to lead and motivate teams is the CSO’s most essential skill39%

Meetingobjectives

Sellingthe

product

3Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective |

Meet today’s CSO The average CSO is a 44-year-old man who has been in his current job for more than four-and-a-half years. CSOs have fewer academic qualifications than their CMO peers, although more than a third have a master’s degree. They hold senior roles, with two-thirds on the executive board. Unsurprisingly, they are results-driven: two of the top four things that make being sales chief most worthwhile are meeting objectives and selling the product. The average sales leader has a short-term focus, being a third less likely than the CMO to find strategic management rewarding. Their workload is growing: a rise in responsibility and activity is the primary change of the past five years. They are confident in their abilities and often ambitious: more than one in four think they will be CEO by 2019.

“Hello, Mr. Customer, you know Xerox, of course. Let’s sit down to discuss your needs and how we may be helping you to solve your business problems.”Valérie Thomassin, Senior Vice President, Corporate Marketing & Communication for Europe at Xerox

4 | Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective

The evolution imperativeCSOs are well aware that their changing environment requires them to adapt and evolve. More than 8 out of 10 agree strongly that “being able to manage change effectively” is essential to the role. While the best CSOs are evolving swiftly, many seem to think that best practice still involves doing things the old way. Innovation is 21st on the list of things that makes their job worthwhile. “Going beyond traditional sales methods” and “developing innovative products and services” are joint 7th out of 10 areas of board influence. A significant number seems slow to embrace new ways of connecting with customers: when it comes to where they deliver value, “ensuring that the company effectively uses new channels of communication” is the lowest-rated area at 28%.

“The hardest thing about B2B selling today is that customers don’t need you the way they used to.”1

Harvard Business Review

1 The end of solution sales, Harvard Business Review, July–August 2012.

Just 2%

of CSOs say social media has changed the way they work.

Only 3%

say innovation helps make their job worthwhile.

5Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective |

Meeting customer needsCSOs believe they are client-focused. More than two-thirds assert that they use customer feedback to develop the business and ensure interaction with the customer is consistent and seamless across all channels. Yet other results suggest many focus on what they think customers want rather than what they actually do desire. Alarmingly, despite the data-driven nature of today’s business world, less than half believe “the head of sales cannot thrive without exploiting big data.” And although interaction with clients comes 4th on the list of things that makes sales leadership worthwhile, “meeting client needs” comes just 11th. It seems as if a high proportion of CSOs is still focusing on the immediate sale rather than on the more profitable goal of long-term customer relationships.

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Just 42%

believe successful sales chiefs must exploit big data.

“Sales functions are measured against short-term results. Analyzing big data, or defining plans and strategies, is a longer-term investment. It is likely to take from six months to a year, which is a time horizon that salespeople would typically not consider.”Alessandro Buccella, EY EMEIA Customer Practice Leader

6 | Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective

How are you integrating the digital experience in your sales practices?

Which analytics have you used to measure the customer experience and how are you using the results to improve it?

What programs are you pursuing to improve the customer experience?

In what ways are you collaborating with other teams to ensure all customer touch points reflect the brand?

How are you developing collaborative relationships with customers?

In what ways do you monitor customer-centric companies, both inside and outside your industry?

How does your contribution to the board drive company strategy?

In what ways have you partnered with the CIO to ensure integrated company information systems?

How do you make sure you and your team remain up to date with technology?

Which means do you use to mine relevant cross-channel customer data?t programs are you pursuing to improve the customer experience?

Are you on track to be a leading CSO? CSO

7Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective |

Board relationshipsSome CSOs remain as conventional in their board relationships as they are in the way they work. Our research shows that sales leaders still focus on their traditional allies — the CEO and CMO. (However, despite 68% of CSOs extolling their strong relationship with the marketing chief, “working with different departments, areas or organizations” actually comes low on the CSO’s list of what makes the job fulfilling.) Another sign that many CSOs are underestimating the importance of technology and data analysis in sales today is that they say their weakest relationship is with the CIO. Just 58% of sales leaders believe they get on well with the IT chief: strikingly, far less of the C-suite — just 25% — feel these two executives have a good relationship.

82%

of CSOs say they enjoy a good relationship with the CEO.

CEO

62%

assert they have strong bonds with the CFO.

CFO

Just 58%

believe they get on well with the CIO.

CIO

“Some sales directors focus on their own areas and are not team players. In my view, they are the ones who are not so successful. They have a complex job, working with marketing, finance and procurement. Being collaborative helps them to achieve better results.”Patrick Steppe, Chief Sales and Marketing Officer at wholesaler and logistics company Lekkerland

8 | Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective

Outperforming the CMOCSOs may remain aloof from some of their peers but, despite this, the C-suite is uniformly positive about the sales leader’s abilities and contribution. It believes the CSO wields more influence on the board than the CMO in 7 out of 10 key sales and marketing spheres. The C-suite even contends that the CSO outperforms the CMO in several “natural” marketing spheres, including ensuring seamless cross-channel customer interaction and in building and protecting the brand. The C-suite’s good opinion of the CSO is reflected back in the sales chiefs’ own self-confidence: they rate themselves even higher than the board across several areas.

69%

of the C-suite think the CSO ensures seamless cross-channel customer interaction; 25% believe the CMO does.

78%

say the CSO convinces them that the company would fail without sales: 35% say the same about the CMO and marketing.

“The CSO is the person they look to for short-term commercial success, the one with the customer contacts and a strong say in innovation. They are usually also very vocal and have all the latest market news and customer developments to hand at executive meetings.”Dr. Michael M. Meier, Co-Leader Global CMO Practice at executive search company Egon Zehnder

9Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective |

The smart CSOThe average sales chief may be evolving slowly, but in-depth EY interviews with leading CSOs show that many are moving swiftly to ensure that they and their teams remain fit for purpose.

“We are not organized, in the customer’s world, by functions or business units, so we need to align ourselves in ways that recognize this. It is essential to leverage every single touch point, to be consistent in both messaging and service delivery strategies and to amplify the impact, not only with the customer, but with the broader universe of influencers out there.”Donna Peeples, Chief Customer Experience Officer at insurance and financial services company AIG

… strengthening key relationships

► Developing productive and constructive relationships with the executive board

► Making an ally of the CIO

► Working closely with marketing and other parts of the company

► Building long-term relationships with customers

… mastering essential skills

► Looking beyond immediate targets to a more strategic view

► Leveraging big data to build relationships and plan ahead

► Exploiting innovation and automation to increase effectiveness

► Borrowing techniques from marketing to differentiate their portfolio

… responding to the empowered customer

► Abandoning the traditional playbook and becoming a problem solver

► Shaping a customer-centric role based on meeting clients’ changing needs

► Creating a positive customer experience

In doing so, they become a partner to customers and a strategic asset to the company and strengthen their position and longevity on the executive team.

Today’s smart CSO is ...

10 | Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective

Delivering a superior customer experience The contemporary CSO is positioned perfectly to deliver the superior customer experience that is key to business success. They have the respect of the executive board, strong self-confidence and a track record in building strong understanding and relationships with customers. However, if they — and their companies — are to prosper, they must act now to develop the skills, mindset and relationships that the digital era demands.

“Instead of going into a company and talking about what we sell, it is more about asking yourself: ‘What is the customer trying to accomplish — and how can we help them?’ It’s about trying to understand their pain points and bringing solutions to them.”Maria Ciliberti, Vice President, Sales Europe, Middle East and Africa at technology and specialty materials company Celanese

The report assesses what it means to be a sales and marketing leader today, considering how:

► CSOs and CMOs view their key relationships, measure their success and core competencies and define the ideal sales, marketing or commercial leader

► The C-suite perceives the sales and marketing leader role

► The roles might evolve, including the emergence of commercial leaders who head both sales and marketing

For further information, please visit www.ey.com/dna-csmo.

11Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders The CSO perspective |

AppendixThis perspective draws from Competition, coexistence or symbiosis? The DNA of C-suite sales and marketing leaders. This EY report, which was launched in September 2014, examines the changing role of both the CSO and CMO as digitalization, proliferating channels and growing customer power transform global commerce.

Competition, coexistence or symbiosis?The DNA of C-suite sales and marketing leaders

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