Bridging a disconnect

"Marketing has ideas and wants to react immediately. IT likes to plan and need time to do things." "Marketing often doesn't consider the costs."

"IT people are unrealistic regarding marketing campaigns."

"IT people are black and white."

Two IT directors uttered the first two statements. The last two came from heads of marketing.

They were among the responses of IS and marketing executives who participated in a recent study conducted by a group of academics at Victoria University of Wellington (VUW).

If these statements resonate with the experiences of the IT and marketing departments in your organisation, then it is time to take stock.

A disconnect between the two units will have profound long-term effects, that could affect the very viability of the company. But when these two departments work in alignment, "there is a very decided positive impact on business performance", says Val Hooper, senior lecturer, information management at the VUW, and chief author of the study.

Hooper, who pursued the subject of IS and marketing alignment for her doctoral dissertation, decided to investigate the topic following her extensive consulting experience overseas.

She had observed that in companies where there was a close alignment between IS/IT and marketing, "Those companies appeared to thrive in terms of their business performance."

Connecting vital operations

The subject is timely, for as Forrester analyst Elana Anderson points out in a recent report, "Marketing is sitting at a crossroads - it is a critical external interface with customers and prospects, but it is struggling to change in today's environment as the effectiveness of traditional tactics decline. IT, as well as executive management, must understand the urgency and seek to exploit ways in which technology can enable that change."

Anderson says technology is critical as marketers need to integrate vast sources of data, present targeted messages to customers and increase the measurability of marketing. If there is no strong coordination between the two departments, marketing efforts will falter.

Yet, in a survey of marketing executives from companies that include Verizon Wireless and JP Morgan Chase, Forrester finds a "disconnect" between the two vital operations of the company. Only a third of marketers report a "strong" relationship that involves regular communications and co-ordination with IT.

The marketing executives say "difficulty working with IT" is one of the barriers preventing the organisation from making better use of technology. "When our systems fail, IT just doesn't understand the impact and why it is so critical to us," Forrester quotes the marketing head of a global manufacturer.

Forrester says many of the companies it has interviewed have improved the productivity of their marketing-IT relationships as the use of technology has become increasingly important to marketing analysis, planning, execution and measurement.

These companies that have done so share common characteristics. One is dedicated IT support for marketing. "It's not about marketing or IT," says one marketing executive. "It's about what business functions need to get done - you need to bring the IT people into the marketing group to make big technology projects successful."

Forrester also finds executive level business relationship is crucial. The director of global marketing for a high-tech firm says his department got little support from IT. But when the chief marketing officer became a member of the board, discussions on technology now begin with questions of how to acquire and retain customers and how to measure marketing programs.

Seamless relationship

The VUW study interviewed the heads of IT and marketing in 18 large (with 100-plus employees) private companies in New Zealand. Nine companies reported a strong, predominantly positive correlation between the two departments, says Hooper. One head of marketing even questioned the need to explore the subject. "To my mind it's so critical that the relationship [between the two departments] is seamless", the executive noted.

In terms of reporting lines, the VUW research found the IT and marketing heads in eight companies were 'at par' or reporting to the same C-level executive. In six companies, IT was reporting to a lower level executive, while marketing was reporting to a lower level executive compared to IT in four of the companies studied.

But according to Hooper, the "dis-connect" was not greater when the IT and marketing executives were reporting to different C-level executives.

"Although one might have expected such, the difference did not seem to have an impact. What was much more important was that the communication lines and channels between the two be kept wide open. Where a special unit was established to facilitate this inter-functional link, the impact on business performance was significant."

She points out when the two departments "are not pulling together, the good work of one tends to be diminished by lack of support or similarity from the other."

Her advice to ensure both IT and marketing work well together: "Ensure that there is a good mutual understanding of one another's goals and objectives; have a good understanding of one another's function. Do strategic planning in a well-coordinated fashion, as well as operational planning where it involves the other function; and, lastly and most importantly, ensure good communication between the two functions."

On the retail floor

Peter Burggraaff, information technology manager at Farmers Trading, observes the field of marketing has evolved in the past few years and "they need more IT to support it".

Burggraaff, however, says the need to align IT and marketing is not unique. He points out this alignment should hold true for IT and the rest of the business.

Three years ago, Burggraaff says he spent a lot of time in "lowering the barriers between the different departments" which include marketing. Before this, he says, "We [in IT] had a very much you give us what you need and then we give you back [work mode]. We are now more in a partnership mode."

He also has project and business analysts assigned to work with the different departments. He says one analyst is responsible for working with marketing, HR and the stores.

He says the fact that the heads of IS and marketing report to different executives did not affect the way they work together. It also helps that their offices are about 100 metres away from each other.

"We have an open floor plan that makes it easy to interact with the marketing people and the other way around. If the marketing has any IT issues, they just walk up to us.

"We spend a lot of time together to understand how we can get data out of our core system at the moment which will be SAP in the next few weeks, to make sure we can get the data and put it on the shelf."

Another area they are working on is a review of the store's loyalty system and replacement of the point of sale system.

These two projects "open up a lot of marketing opportunities", says Burggraaff. "You can communicate directly with your customers and you know what your customers are doing. We are working with them at the moment to make sure whatever we design on the new point of sale system can also actually enhance the way they communicate with their customers."

He says he has worked in other organisations that did not operate this way. "It is still common in a lot of organisations to think very much in a departmental structure. 'I am in IT so I only need to talk to other IT people. I am in marketing so I will only do marketing.'"

He agrees this is an outdated way of working, but observes, "A lot of companies still live in the old world."

"It is only us, the people [who] can change that. And even if the organisational structure might not change, if people change, you already get halfway. And that is the key thing. You can wait for your CEO to organise a separate session, that is one option, but you can start to do it yourself."

His advice to other IT directors echoes that of Hooper: "Be interested in what marketing is trying to achieve and tell the marketing people what you are trying to achieve. If you are interested in each other then you are more likely to talk to each other if you have an issue or a problem."

Setting priorities

Geoff Cooper, managing director, Proximity iD, has worked in marketing campaigns for Air New Zealand, Telecom and the Virtual Rugby competitions, and observes how the two departments can get over differences at work.

And, like Hooper and Burggraaff, Cooper says communications and understanding their respective roles are vital.

"As marketing becomes more and more data dependent, it has to have driven similar changes within the IT parts of the department." This way, he says, the organisation becomes "more responsive and fleeter".

Data mining, he says, is one area where the two departments work together, but could also lead to conflicts.

He cites one scenario where marketing wants data extracted out of the operating system. IT, he says, will ask why marketing wants the data, where is the data going, is it going to be secure, and who will have access to it.

The marketing person on the other hand, may not have specific answers, saying "the data mining process is very exploratory."

This will create issues on priority for the IT director who will think, "IT has 110 jobs for the business of which marketing is only a small part.

I have this request to pull this data out of a system and put it together in a way that has never been done before and the person I am doing it for doesn't really know what they are going to do with it.

"And then I have a request from a store manager to fix up a report that he uses to run his business. Which one am I going to prioritise?"

To the marketer, however, what comes out is this: "It is absolutely essential for me to develop a three-year marketing strategy and IT is telling me I can't get the data out."

It comes back to interface, says Cooper. "The first thing I will do is make sure the people understand what each other is trying to do; that they are capable of understanding both marketing and IT jargon."

Cognisant of this need, Cooper says when Proximity iD checks the CV of candidates to their IT team, "We make sure they have stuff in there that is not just technical.

"There are lot of very capable technical people but if they don't have a 'curiosity about people', they are not going to survive in our environment.

"One of our best project managers has an IT degree and certification but he was also a competition tango dancer and is very musical." He also recommends allowing "face-to-face time" between the members of both teams. If this is not possible because the offices are in disparate locations, the members of both teams should tap technology that would allow this type of communication.

The bottom line, he says, is businesses can overcome issues of any disconnect between IT and marketing. And those who do so have a big advantage over their competitors.

"They can do things quicker, do so much more in shorter windows and create organisations that are very, very responsive to what is happening in the marketplace."