One of the inherent difficulties in growing a company more efficiently is the cost-savings perspective that a traditional CFO has versus the “growth-at-all-costs” perspective that typical Chief Marketing Officer (CMO) may have.
Here at CGA, we’re proud of our non-traditional, more holistic approach to balance growth and profits. In the San Francisco Bay Area and Silicon Valley, we notice that startups and small businesses often do not balance growth rates and profit margins.
The article below from Bizjournals.com is a good case study of how today’s CFO needs to be more open and connected to helping and guiding the strategic efforts of a company’s marketing department.
Here are some great excerpts from the article:
“The CMO/CFO relationship is, more often than not, fraught. One wants to spend the company's money on projects that could seem frivolous to the uninitiated. The other wants to make sure valuable dollars aren't squandered. And often, the two don't communicate well, if at all.”
“But that wasn't an easy sell at first — particularly for Joe Falkenstein, the company's CFO. He's metrics-driven, a numbers guy, and the thought of allocating hard cash for projects with tough-to-measure returns didn't have a lot of appeal."
"A marketer needs to be, frankly, aggressive to do the things that they need to do to accomplish their goals, but often doesn't have respect for some of the P&L or profitability considerations."
"Most CMOs don't have the courage to sit in front of a CFO and be 100 percent honest and vulnerable, and often the CFO isn't willing to share all the knowledge that they have about the business because they need to have their little fiefdom," Falkenstein says. "So it's really about breaking down those walls and having great communication."
"Hamilton agrees. She remembers months of sitting down and sifting through numbers and coming up with different options — conversations that demystified what would happen in his office."
"He taught her that not all sales are the same, and if profitability is really low because of hidden costs in one sector of the business, her time may be better spent elsewhere.
"And she taught him to see marketing as an investment rather than a cost. So when she comes to him asking for a budget for customer retention or for money to invest in a customer care team, 'it's not just Rose making up a creative story,' she says. 'CMOs are known for telling a great story and not necessarily backing it up with the data.'"
Read the full article