TAKE NOTE: Shifting Sands in Technology Decision-Making

Corporations everywhere in the world are now in the midst of a transformation with respect to information technology.  This is not necessarily about a revolution in technology processing power, but rather a fundamental change in the power of technology process – an internal shift in responsibility over IT decision-making within organizations, away from its traditional center, the Chief Information Officer, to the Chief Marketing and Chief Financial Officers.

The trend was signaled in a Gartner Group study, which found that Chief Financial Officers alone authorized a whopping 26% of all IT spending decisions at their organizations, as opposed to just 5% by CIOs.  And a related, more recent Gartner study predicted that by 2017, Chief Marketing Officers will outspend CIOs on information technology.

These watershed changes pose both opportunities and threats to those who sell enterprise technology.  At a minimum, it means that they must re-evaluate the very premises of their customer interactions in order to stay relevant to the new sources of decision-making.

The internal shift in control over IT responsibility is occurring for a couple of reasons.

One has to do with the growing importance of e-commerce in any company’s financial outlook, and the increasing role of social and mobile media in that equation.  Today, the big money in IT spending increasingly lies in tools to mine social media for product ideas, in mobile applications to enhance products, and in creating social interactions with customers to build brand loyalty.  CMOs have claimed all these responsibilities as strategic marketing/communications imperatives; they are driving the technology decisions to make these tasks possible, often leaving the CIO in the back seat.

Second, an expense-conscious global marketplace has rendered IT even more of a cost center, inviting closer financial oversight.  Enter the CFO.  As American Banker has reported, “With limited funds available for investment…CFOs are inserting themselves into the [procurement] process to make sure each IT project provides value.”   Not surprisingly in this climate of tight ROI accountability, Gartner noted that at roughly half of mid-sized to big corporations, CIOs report directly to the Chief Financial Officer.  It’s a trend that will increase over time.

– Selling Tech to the CMO and CFO –

Thus, selling technology to the CMO and CFO demands a more strategic business orientation.  CFOs for example, generally misperceive IT as a commodity – even while they are desperate for it to serve that role.  Seventy percent, according to Gartner, do not think technology is providing business benefits.  Only a little more than one-third see it as a strategic driver of business performance, and only eight percent view IT as a key contributor to the enterprise’s competitive position.

Both CFOs and CMOs speak the language of Return on Investment.  They want to know not only how the performance of a solution will be measured over the lifespan of a project, but what assumptions you are using to make that evaluation.

We are not suggesting that IT sales representatives must magically morph into IT consultants.  But providers must be able to engage a CMO or CFO at the place where consultants operate:  strategy.

Finally, despite their new responsibilities overseeing technology decision-making, few CMOs and CFOs are technology experts.  They need objective guidance.  Suppliers plus the CIO can fill an important role here.

Taking a new step is often what people fear most.  But for those who can address the needs of a newly empowered CMO and CFO through fresh marketing and sales strategies, a world of opportunity awaits.

The ABCs of QR Codes

You’ve undoubtedly seen one … though it’s possible you’ve never used it.   It’s a QR code:  a  more sophisticated, two-dimensional version of a bar code — consisting of square black dots on a white background — that was originally designed in 1994 for Japanese auto-makers to track car parts.   

Big in Asia and Europe, QR codes were a little late coming to the U.S., but now they are an increasingly valuable element in marketing campaigns.  Smartphone users with the right app can simply scan a QR code and be swiftly directed to a rich media experience on the web.  In my vlog today, “The ABCs of QR Codes,” I interview Makovsky VP and Director of Digital Media, Dan Scholz, on the evolving role of QR codes. 

Communicating “Real Beauty”

What is real beauty?  That is a question that apparently is never really answered by Dove in its attention-getting ad that has become an online superstar, having gotten almost 14 million hits on Dove's YouTube channel.  Nevertheless, Dove says that "real beauty" is the theme of its brand campaign and has been since 2005.

The ad has a forensic sketch artist, hidden behind a curtain, drawing the face of a woman  whom he cannot see, based on her description of her own facial features, followed by another person's observations of the same women's facial features.  Separate faces are sketched on separate sheets.  In every case, the sketch depicting the other individual's observations is prettier than the one providing a self-evaluation.

Thus, the tagline for the ad is "You're More Beautiful Than You Think."  The campaign is based on a survey that shows that only 4% of all women see themselves as beautiful.  The message clearly is that Dove is a critical element in enhancing and maintaining beauty. 

There are 3-minute and 6-minute versions of the ad, making it strictly for online exposure rather than TV.  Capturing audience attention for that long is significant. 

While it is clear from the ad that women are concerned about their appearance and undervalue the way they look, it seems Dove has a bigger opportunity to extend the beauty platform beyond the physical, and thereby capture the attention of a still larger audience and further build brand value. 

Our culture today defines beauty as not only skin deep.  Thus, female beauty involves the total person.  Men would never be positioned the way women are in this ad.  One woman quoted in a New York Times piece on the Dove campaign had mixed feelings about the ad, saying, "What if I did look like the woman [in the less flattering sketch] on the left.  There are people who look like that."

"Real Beauty" in that case would be expanded to include both inner and outer beauty, making women think about the value placed on both.  Dove's impact on a woman's skin will be important no matter what, and the campaign theme, "You're More Beautiful Than You Think," will have a broader meaning and expand the customer base.  

Look for the Helpers

This advice came to mind on the heels of the latest Boston Massacre -- the bombing at the finish line at the Boston Marathon.   

It has been all over the web the past couple days via the persona of the late Fred Rogers, whose famous children's show was the champion of many parents.  What he said, as noted below, stands as great communications for those who sympathize with the victims and the victims themselves.   I paraphrase Mr. Rogers below, and also provide the link, above:

My mother used to say a long time ago that whenever there is a catastrophe, “always look for the helpers … there will always be helpers. … If news programs could make a conscious effort of showing rescue teams — or showing anybody who is coming into a place where there’s a tragedy — to be sure they include that … because if you look for the helpers, you’ll know that there’s HOPE."

Journalism: Money vs. Merit

I am particularly troubled by obfuscation, which I define as the art of attempting to confuse people.  I have always believed that playing it straight sets all of us on a better course.

This came to mind the other day when The New York Times ran a piece, “Sponsors NowPay for Online Articles, Not Just Ads.” 

So, what does that headline exactly mean?  Everyone knows what advertisements are.  Everyone also knows what articles are.  What the Times story is addressing is the marrying of the two:  articles that are ads.  Anything wrong with that?  Not at all.  As long as the articles that are ads are clearly identified as such, and not in print so tiny that the reader would not know whether the article was paid for by a sponsor or objectively written by a journalist who works for the publication.  The problem is that the way these “sponsored articles” are often positioned, it is hard for the reader to decipher the difference.  But below I note some other problems.

Why are advertisers sponsoring articles in online publications these days more than previously?  Because of a decline in audience receptivity to banner ads, largely due to online readers’ orientation toward conversation, stories and softer messages.  Articles, essays and op-eds fit that profile.   The latter have always been the domain of the public relations professional, who communicates client messages editorially, but only if the publication sees value in such messages for its readership.  Now the ad agency has entered the fray via paid content.

In addition to the potential obfuscation by publications that don’t clearly label paid content for what it is, I am most troubled by the prospect of money eventually trumping meritocracy in journalism and making it more difficult for new ideas and investigatory work to reach a wide audience.  While I have no problem with properly identified paid content, I am concerned about the availability of choice locations for the topics that need to be communicated.

Public relations for years has fostered the value of advertorials (today called branded content, paid for by an advertiser), such as a dedicated magazine sporting a client’s message via articles and sewn into publications -- or one-page or partial-page takes.  There are magazines that have always been “pay-for-play” —particularly in the investor area—where every article is sponsored by a client advertiser who must get a point of view published, and this is acknowledged by the publication.  The head of an agency in India told me about the most horrific case I’ve heard of:  in that country, some publications now restrict free journalism among their reporters if the publication can get sponsored money for a piece that it would have ordinarily written on its own with its own point of view.  Thus, reporters now face restrictions in the investigation process.

Thankfully, many publications are still vigilant, and social media and some owned media channels provide alternative, credible ways to publish.  Nevertheless, I hope readers are sensitive to the environment in which information is dispensed and are scrutinizing in their selections.

The SEC and Social Media

Twitter and Facebook just had another rocket ship put in their trajectory!  They, along with other social media, have been officially deemed by the Securities and Exchange Commission to be acceptable venues for companies to disclose material information to investors.  The only caveat is that public companies must advise investors where the information can be found, most likely using traditional media to do so.

While this development has been talked about for years and greeted with criticism by some and enthusiasm by many, it also poses several challenges.

As The Wall Street Journal notes, only 14.4% of companies currently use social media, according to a 2012 Conference Board and Stanford University study.  Thus, the implementation may be challenging for those not very familiar with the social opportunities this presents.  It is also not clear how investors will respond to heightened use of social media in this area, despite the fact that millions of investors use social media now to check up on companies, monitor news and discuss investment opportunities.

John McInerney, a group vice president in Makovsky’s Financial Services Practice, notes in his blog, “Social Media Evolution:  The SEC and Bloomberg,” appearing  in “Word on the Street,” that most Wall Street broker-dealers, advisors, investment bankers, and traders cannot access the social web with the freedom that individual investors can.  “Required to document client communications and fearing insider trading tips, these executives are blocked by their compliance departments from accessing most forms of social media.”

He further said that for all of the SEC’s guidance, this means most of the advisors who are responsible for managing trillions of dollars in assets can’t take advantage of social media’s “information, speed and richness.”  Paradoxically, even if Wall Street could get material via social media, they couldn’t act on it. 

Until last Thursday.

McInerney points out that Bloomberg made a change that is far more important than the SEC’s announcement.  Last Thursday Bloomberg completely integrated Twitter into its terminals, creating a last-mile connection between companies, social media and Wall Street. 

Mr. McInerney says that this is not the time to sit on the sidelines.  Companies will need to join the party to compete for investor attention and to tell their story or risk letting others do so for them.  More than ever, Twitter and Facebook followers will be discussing companies in real time.  Firms will need not only to monitor, but also develop, mechanisms to be part of the conversations.

Why Communicators Must Be Optimists

I was recently speaking with a chief policy advisor to the president of a small but important country who said the president made a critical point:  optimists and pessimists die the same way but they live their lives very differently.  Optimists get things done, pessimists do very little.  I subscribe to this philosophy, and I believe it is particularly relevant to those of us who are in the communications business.

In fact, the success of our country has always been attributed to its optimistic posture.  In fact, I recall a research by psychologists Harold Zullow and Martin Seligman at the University of Pennsylvania, who studied the level of pessimism in the nomination acceptance speeches by every U.S. presidential candidate between 1948 and 1984 and found that, in 9 of the 10 cases, the more optimistic candidate won.  (The one exception was Hubert Humphrey’s defeat by Richard Nixon in 1968.)  

Optimism was marked by seeing problems — whether global or personal— as temporary and correctable; pessimism was marked by taking the blame for the problems or by seeing them as intractable.

It would be interesting to take a survey of CEOs of Fortune 500 companies with respect to their optimism/pessimism and see where they stand vs. CEOs of startups, small businesses and midsize companies.

That said, why do I believe that being an optimist is important for those of us in communications?  Let me first define the word optimism and what it means to classify oneself as an optimist.  I am not talking about being a starry-eyed, mirage-making daydreamer.  I am talking about positive thinkers, those who imagine solutions for themselves or society and work to make sure they happen. "If you will it, it is no dream," said Theodore Herzel, a founder of the state of Israel. 

As communicators, we can influence what our clients say and ultimately do.  In an age when surveys show that engagement and integrity are key attributes by which our clients' customers judge them, we need to take responsibility for the strategy that will result in such best practices.  Our words can influence transparency.  Our words influence behaviors.  Our words influence collaboration.  Our words can inspire achievement and even save lives.  Client leadership with optimism makes all the difference.

What Swearing Can Do for You

Swear words?  It’s rarely acceptable to use them in public.   A politician could end his or her career if caught cursing in the media.  But the same is true of the less recognized business executive … or leaders of virtually any organization.  Even within an organization, using swear words as part of your management style, particularly when angry, is verboten.

Yet we know that everyone uses swear words privately among colleagues, friends, and neighbors, as just an expression or even as humor.   Politicians and celebrities also use them privately.  They are particularly handy when something has gone wrong and a horrible situation has developed.  You may even use them talking to yourself when no one else is around.

Now comes a study in NeuroReport which says that people who use swear words in painful situations experience less pain.  Neuroscientists tested this theory in various painful situations, including the birth process, and the results were consistent.  There’s an interesting summary by Juliette Siegfried  on the HealthGuidance website. 

This test does not change the public vs. private protocols previously discussed.  But it does instill some respect for the power of swear words as a crutch — on the private side — to help lessen some of the pain you may experience when going through a challenging situation.

The Hidden Advantage of Awards

This is awards season in the public relations business, when executives submit campaigns for gold, silver and bronze prizes sponsored by various organizations and publications. 

Agencies all over the US compete for this recognition and, obviously, it is thrilling to win. 

We had the good fortune in 2012 to be honored with 21 awards recognizing our client campaigns, our professionals, and the firm itself.  Among them were "Mid-Size Agency of the Year" and "Agency of the Year" given by PR News and the American Business Awards, respectively.  We have our fingers crossed for 2013.

There is little that beats recognition, but industry-wide awards provide other benefits for the recipient.  They are optimum benchmarking, indicating that the recipient agency's work and/or its professionals are standard-setting.   They build the credibility and strength of the agency, validating the agency's position with prospective clients.  They demonstrate the value the agency has brought to the client and, in this metric-conscious world, there is little better than that.  Such awards communicate to the individual and their peers that the winners are solid professionals whose achievements stand out.  Consistently winning them is reinforcement of all of these points.

We have also had the good fortune of developing national award programs for such clients as Schwab and American Management System (since acquired), a billion dollar software company, where the client in each situation was the donor and recipients were current or perspective clients.  The Schwab Impact Award recognized the various achievements of  its registered investment advisor clients.  AMS recognized innovation in tech among its prospects.  The awards were given annually, in these two cases, at or near ten years.  Outside judging panels were used.  Over time, these award programs built the authority and stature of these clients, and did for their prospects and clients exactly what I described in the previous paragraph. 

When it comes to awards, the ROI — whether donor or recipient — is big!