2015-collaboration-hot-spots
TRANSCRIPT
2015 Collaboration Hot Spots
The 14 Most Powerful Functional Partnerships in Midsized Companies
Middle Market Report
Introduction • 5
Finance: Building New Finance
Capabilities • 10
HR: Aligning Workforce
Planning with Business Strategy • 12
IT: Adapting IT to Fulfill Speed-
to-Market Expectations • 14
Legal: Enabling (Not Restraining)
Business Growth • 16
Marketing: Finding New
Customers • 18
Sales: Helping Customers
Overcome Stalled Buying Inertia • 20
Procurement and Operations: Achieving Influence Throughout
the Business • 22
Midsized companies drive growth by tapping the potential of functional collaboration.
5
More employees now work across teams, functions, and levels.
Drive Growth with Less
of employees say
they work with different teams and departments.
67%
of employees say they
regularly work with 20 or more colleagues.
30%
of employees coordinate with at least 10 people
to complete their day-to-
day work.
60%
Seventy-three percent of midsized companies expect increased revenue
in 2015, and 66% also expect increased cost pressure. How are midsized
companies going to realize revenue gains with sustained cost pressure?
Our research shows that growth will come from innovation, new ideas,
and efficiencies realized through close collaboration between business
lines, functions, and customers.
What’s behind this trend?
Organizational hierarchies—traditionally the conduit of information
and execution—are slowly collapsing. The formal “org chart” at many
companies is now no more than a rough guide because more employees
now work across teams, functions, and levels.
IN FACT
Introduction
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
6 7
Cross-functional fluency has become critical to the enterprise. In today’s
work environment, executives—including those in the following functions—
must work across traditional lines to achieve business outcomes:
Finance—To effect change and drive growth, finance executives at midsized
companies report they need to regularly influence C-level staff (60% need
to influence head of Sales, 54% the CIO, 53% the CHRO, and 48% the CMO).
IT—40% of the IT budget is driven by functions such as Marketing, Sales,
HR, Procurement and Operations, and Finance, requiring CIOs and their
teams to shift to more consultative roles.
Sales—Approximately three in four sellers must engage with more customer
stakeholders (5.34 people) to close a deal.
In this volatile and increasingly matrixed environment, leaders must not only
master their function. They must also clearly understand and communicate
its linkage to overall corporate strategy and cross-linkages to functional
and business partners. Business initiatives—such as analytics, workforce
planning, career pathing, IT, sales and operations planning, and risk
management—now demand a pan-company perspective and approach.
Cross-Functional Fluency | krȯs-‘fəŋ(k)-shnəl ‘flü-ən(t)-sē |nounThe ability of functional leaders to identify, understand, and drive exponential value from critical intersections and collaboration opportunities with other functions
of sellers must engage with more
customer stakeholders (5.34
people) to close a deal.78%
The key to realizing revenue gains is what we call “cross-functional fluency.”
report they need to
influence the head of Sales.
report they must
influence the CIO.report they must
influence the CHRO.report they need to
influence the CMO.
60% 54% 53% 48%
At midsized companies, influencing is key to a finance executive’s role.
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
8 9
Source: CEB analysis.
Finance HR IT Legal Marketing SalesProcurement
and Operations
Finance: Building New Finance Capabilities
—
HR: Aligning Workforce Planning with Business Strategy
—
IT: Adapting IT to Fulfill Speed-to-Market Expectations
—
Legal: Enabling (Not Restraining) Business Growth
—
Marketing: Finding New Customers
—
Sales: Helping Customers Overcome Stalled Buying Inertia
—
Procurement and Operations: Achieving Influence Throughout the Business
—
Key Priorities Requiring Cross-Functional Fluency
The following seven priorities demonstrate the increased need for cross-functional fluency.
High Fluency Required Moderate Fluency Required Low Fluency Required
Intro Finance Legal Marketing Sales Procurement and OperationsHRHome IT
10 11
Finance teams struggle to add value to the overall organization.
According to our research, 80% of finance
teams do not positively influence business
decisions. Why? Big data and cloud-based
technologies have led to a democratization
of data, meaning Finance’s business partners
access and consume data differently than
before.
More concerning, these business partners lack
the financial acumen and judgment needed to
analyze data appropriately, leaving Finance
responsible for cleaning up the resulting mess.
Cross-Functional Fluency Matrix: Building New Finance Capabilities
ȕ Enlist your HR’s team help in recasting finance competencies to reflect new business needs.
ȕ Partner with the CIO to redefine data speed, access, and quality for decision makers.
Share guidance on building a better finance competency model with your HR team.
Leverage our research on top priorities for middle market IT departments to help put your support request in context.
Resources to Help You Get Started
Key Activities to Build Cross-Functional Fluency
Finance: Building New Finance Capabilities
To better support and shape business
decision making, CFOs are heavily investing in
collaboration and analytic capabilities. Efforts
include improving financial planning and
analysis, buying sophisticated systems, and
hiring experienced analytical staff. But returns
on these investments have been marginal at
best.
Needed Fluencies: Finance to HRCFOs know the biggest factor impeding
Finance from driving true strategic value is the
finance team’s capabilities. In fact, less than
20% of CFOs believe their team effectively
influences business decisions.
Finance must partner with HR to build
recruitment, development, assessment, and
promotion criteria that focus on the hard-to-
find yet critical competencies (which we call
“Pathfinder” competencies) that differentiate
great finance teams. These competencies
help finance staff go beyond the standard
technical skill set to build strategic acumen,
team development skills, and interpersonal
influence capabilities.
Needed Fluencies: Finance to ITBusiness partners no longer wait on Finance
to make or support decisions; in fact, our
research shows that 81% of business decision
makers use six or more sources to make the
average decision.
To remain relevant, finance teams must
improve data speed, access, and quality.
Doing so requires finance leaders to partner
with their IT counterparts to: ȕ Identify and protect truly critical data
sources; ȕ Develop standards and governance to
ensure financial data is high quality; and ȕ Implement new systems and capabilities
(e.g., data warehouses, analytical tools) that
enable business partners through faster and
easier data access.Finance HR IT Legal Marketing SalesProcurement
and Operations
Finance —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
12 13
Key Activities to Build Cross-Functional Fluency
Planning for and staffing the talent needed to execute strategy is mission critical.
According to our research, less than 30% of HR
executives are effective at strategic workforce
planning.
HR: Aligning Workforce Planning with Business Strategy
HR also faces a significant retention problem:
75% of high performers are considering
leaving their current organization, and
nothing is stopping them from doing so if
organizations don’t help them build skills and
stay engaged.
Cross-Functional Fluency Matrix: Aligning Workforce Planning with Business Strategy
Needed Fluencies: HR to FinanceTo improve the validity and impact of strategic
workforce plans, CHROs must partner with
CFOs, who can help support the business
case for talent investment because they know
whether the organization has the resources it
needs to achieve its key objectives.
Ultimately, neither workforce planning nor
operational planning is effective if done in a
vacuum.
Needed Fluencies: HR to ITIT is a key ally in retaining talent because it
can implement the systems and tools that
will best drive employee productivity and
collaboration.
IT also has an intimate understanding of
knowledge workers—what competencies
they need (e.g., effectively collaborate,
apply judgment, adapt to change) and how
to develop them. The best CHROs tap into
this expertise when making critical talent
management decisions.
ȕ Speak your CFO’s language to enlist his or her support for workforce planning.
ȕ Have a dialogue with your cross-functional peers about the talent needed to execute strategy.
Read our blog, “Bridging the CHRO/CFO Divide.”
Use the Workforce Analysis Questionnaire to assess your business partners’ talent needs.
Finance HR IT Legal Marketing SalesProcurement
and Operations
HR —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
Resources to Help You Get Started
14 15
Key Activities to Build Cross-Functional Fluency
Resources to Help You Get Started
Several complicating factors are causing CIOs to rethink how they manage technology.
More technology decisions are being made
outside IT as vendors and business partners
engage directly; IT planning horizons are
getting shorter; funding has remained flat,
despite the reach and relevance of technology
to all parts of the business. Collectively, these
complications are affecting IT strategy, and
CIOs are desperate to address these changes
quickly.
Once past the usual temptation (or
distraction) of so-called silver bullets (e.g., a
reorganization, imported expertise, the latest
cloud-based analytics solution), reality sets in:
IT needs to change. IT must be more adaptive.
Cross-Functional Fluency Matrix: Adapting IT to Fulfill Speed-to-Market Expectations
IT: Adapting IT to Fulfill Speed- to-Market Expectations
A crucial component of an adaptive IT
organization is that it engages more effectively
with other parts of the business, namely Sales
and Marketing, functions that are closest
to the customer base and that have high
expectations for innovation and speed to
market.
Needed Fluencies: IT to SalesIT must partner with Sales to understand where
to support technology-driven opportunities
for innovation.
Rather than own all decisions related to
technology, IT must focus disproportionate
effort in areas where it has comparative
advantage and “dare to be adequate”
elsewhere.
Needed Fluencies: IT to MarketingWhen it comes to digital marketing, IT and
Marketing must share the responsibility of
exploring new opportunities, taking care not
to compromise efficiency. For example, IT
can take the lead on use cases, integration,
support, maintenance, and hidden costs,
while Marketing identifies new innovation
opportunities in the digital space.
When responsibilities are shared, both
business and IT priorities are represented and
the entire enterprise benefits from the cross-
collaboration.
ȕ Create a climate of openness to technology innovation by supporting business conversations with vendors.
ȕ Speak your CMO’s language to build a partnership around digital marketing.
Share the Technology Buyer’s Guide with business partners to ensure smart tech investments.
Edit and deliver the Point of View: CMO presentation template to begin the dialogue with Marketing.
Finance HR IT Legal Marketing SalesProcurement
and Operations
IT —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
16 17
Key Activities to Build Cross-Functional Fluency
Resources to Help You Get Started
Companies must optimize the legal function for business effectiveness.
The scope of the legal department at midsized
companies is expanding, increasing the
pressure on the general counsel (GC) to serve
as a strategic business partner, as well as chief
legal advisor, to the company.
At the same time, legal departments remain
lean, and they struggle to engage a growing
base. Eighty percent of middle managers—
particularly in Marketing, Sales, and IT—make
Legal: Enabling (Not Restraining) Business Growth
decisions with legal implications, but too
few seek legal guidance. In fact, three in four
employees think the time and effort involved
in working with Legal exceeds its value.
The best GCs are those who can anticipate
how the needs of the business will affect the
legal department and who can practically
make real-time, smart decisions to respond to
those needs.
Needed Fluencies: Legal to ITIn today’s work environment, information
security, privacy, and records management
risks are increasing. Legal must partner with
IT to ensure processes, policies, training, and
controls are robust enough to navigate this
complex risk landscape.
Needed Fluencies: Legal to HRAs companies grow and expand into new
product and geographic markets, risks
are manifesting outside traditional areas
of legal support (e.g., contracts, litigation,
M&A). Regulators and other external
stakeholders have overly broad expectations
about companies’ legal and compliance
requirements, especially when experiencing
growth and change.
Particularly in ambiguous or uncertain legal
terrain, HR and Legal must partner together
to ensure the company’s approach to
compliance, ethics, and a culture of integrity
evolves with business conditions and risks.
ȕ Evolve your compliance guidance with business needs and risks.
ȕ Implement simple data privacy rules for your organization.
Use our Code of Conduct Rollout Guide with HR to update and roll out your company’s code.
Share our sample privacy impact assessments with your CIO to determine a course of action.
Cross-Functional Fluency Matrix: Enabling (Not Restraining) Business Growth
Finance HR IT Legal Marketing SalesProcurement
and Operations
Legal —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
18 19
Key Activities to Build Cross-Functional Fluency
Resources to Help You Get Started
The goal for Marketing is simple: find new customers.
To find new customers, CMOs are accelerating
their year-over-year spend by 11%. But this
approach is causing an efficiency problem:
marketing executives expect to spend more
per revenue dollar than they did last year.
Marketing: Finding New Customers
In addition, deals are dragging on due
to more consensus buying. Today’s typical
B2B purchase decision involves 5.4 decision
makers. Differences in opinion make it
increasingly hard to reach a decision, and
many teams are simply giving up on purchases
altogether.
Needed Fluencies: Marketing to SalesMarketing must partner with Sales to evolve
client and prospect engagement and to
overcome complexities in today’s challenging
buying landscape. Specifically, marketers
must begin to facilitate consensus in the early
stages of decision making.
First, marketers need to understand and
articulate the right mix of: ȕ Business value, ȕ Performance value, and ȕ Identity value (i.e., benefits for the buyer’s
self-esteem, such as pride in work or sense
of belonging).
With this knowledge, they can create powerful
internal advocates that overcome consensus
inertia and restart stalled deals.
Needed Fluencies: Marketing to ITMarketing and IT have a naturally competing
set of priorities, but their partnership is crucial
to both functions’ success.
The best Marketing–IT partnerships
yield cocreated visions as well as
collaboratively developed “catalyst” projects.
Tight integration requires a set of safe
boundaries to ensure marketing technology
experimentation never interferes with critical
systems of record.
ȕ Partner with Sales to influence consensus early on in the buying process.
ȕ Partner with your IT team to outline your marketing technology roadmap.
With your sales leader, use this six-question quiz to scope consensus buying challenges.
Share our digital marketing capabilities roadmaps with your CIO to evaluate your marketing technology investments.
Cross-Functional Fluency Matrix: Finding New Customers
Finance HR IT Legal Marketing SalesProcurement
and Operations
Marketing —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
20 21
Key Activities to Build Cross-Functional Fluency
Resources to Help You Get Started
Companies are taking twice as long to buy.
With so much information now available,
customers aren’t talking with vendors until
they’re 57% through the buying process.
In addition, 75% of companies report an
increase in the diversity of formal decision
makers, which makes it more difficult to
secure consensus on not only whom to buy
from but what to buy.
As a result, sellers who struggle to influence
the buying process are forced to invest
Sales: Helping Customers Overcome Stalled Buying Inertia
significant time and resources to meet
customers’ demands, leading to longer sales
cycle times, compressed margins, and stalled
deals.
Leading sales organizations know the
importance of simplifying the customer’s
purchase experience, and they use the
Challenger™ model to enable reps to better
guide customers through the purchase
journey while reducing the complexity of their
own organizations.
Needed Fluencies: Sales to MarketingSales needs help from Marketing to build
powerful insight stories that help more diverse
groups of decision makers overcome slow
buying inertia.
Needed Fluencies: Sales to ITSales and IT must work together to create a
customer-centric sales funnel that can simplify
the purchase experience.
Needed Fluencies: Sales to HRSales must partner with HR to evolve
the employment value proposition and
development ecosystem to better attract,
develop, and retain insight-focused sellers.
ȕ Start your company on the Challenger™ selling journey.
ȕ Make your CRM sales funnel more customer centric by aligning it with customer buying signals, not internal metrics.
ȕ Partner with HR to attract, develop, and retain Challengers.
ȕ Instead of predicting the likelihood to close based on (subjective) seller activities, forecast using (objective) customer behaviors.
Use our Challenger selling presentation template to brief your marketing leadership.
Share our customer-paced sales funnel best practice with your CIO.
Share our Developing Challenger Competency Models with the CHRO.
Leverage our deal verification toolkit.
Cross-Functional Fluency Matrix: Helping Customers Overcome Stalled Buying Inertia
Finance HR IT Legal Marketing SalesProcurement
and Operations
Sales —
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
22 23
Key Activities to Build Cross-Functional Fluency
Resources to Help You Get Started
Procurement and operations teams are often left out of decision-making processes.
Procurement and operations organizations
that ignore their internal relationships will find
themselves unable to deliver on many of their
strategic projects and savings goals.
Approximately 8% of savings promised by
global sourcing initiatives can be lost when
poor alignment with business partners results
in their resistance to participate in spend
Procurement and Operations: Achieving Influence Throughout the Business
agreements they believe are not in their best
interest. Another 6% of savings promised can
be lost due to business partner noncompliance
after the contract is already in place.
Needed Fluencies: Procurement and Operations to FinanceTo transform the image of Procurement and
Operations, functional executives can use
early savings victories to secure support
for expanding functional performance
measurement.
This tactic will allow new value metrics to
capture the total contribution of Procurement
and Operations to key business partner
priorities. It’s critical that procurement and
operations executives build the case with their
CFO, who can help approve new value metrics.
To deliver on new, expanded metrics,
Procurement and Operations must then
increase its internal influence: the best
procurement and operations executives are
building their teams’ influencing skills to
increase adoption of initiatives led by the
function.
ȕ Expand the metrics in your dashboard to support a more strategic role for Procurement and Operations.
ȕ Generate higher-value opportunities for the business by challenging entrenched business partner thinking.
Share our list of strategic metrics with your CFO to build the case for a revised procurement and operations dashboard.
Read our blog, “Procurement: How to Influence the Marketing Category.”
Cross-Functional Fluency Matrix: Achieving Influence Throughout the Business
Finance HR IT Legal Marketing SalesProcurement
and Operations
Procurement and Operations
—
Intro Finance Legal Marketing Sales Procurement and OperationsHR ITHome
Source: CEB analysis.
High Fluency Required Moderate Fluency Required Low Fluency Required
© 2015 CEB. All rights reserved. CEB151674GD
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ȕ CEB Legal & Compliance Leadership Council for Midsized Companies
ȕ CEB Marketing Leadership Council™ for Midsized Companies
ȕ CEB Sales Leadership Council for Midsized Companies
ȕ CEB Procurement & Operations Leadership Council for Midsized Companies
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