Tag Archives: integrated marketing

June 23, 2014 · 12:13 pm

Peter Drucker on “The Four Roles of the CFO”

In the early 1990s, Highlander Consulting was engaged by Phibro Energy to help introduce energy derivatives to Chief Financial Officers at corporations with substantial exposure to fluctuations in oil, gasoline and jet fuel prices.

As part of an integrated marketing strategy, management legend Dr. Peter F. Drucker, then serving as a professor at Claremont Graduate School, was engaged to serve as keynote speaker at the Phibro Energy Risk Management Forum, held at The Metropolitan Club in New York City.

Dr. Drucker, who passed away at age 95 in 2005, chose to speak on what he called, “The Four Roles of the CFO.” His remarks before more than 200 CFOs appear to be as relevant now as when he spoke to them nearly 25 years ago.

Here are some highlights from Peter Drucker’s presentation, which can not be found in any one of his 39 books:

The CFO as Information Officer:

“The original role of the CFO was to be the information officer of the business…Accounting, which is information, is changing today more than it has changed in the last hundred years…CFOs will have to make an important decision for their companies not very far down the line, on how to get rid of the pernicious rift between information that is concept-focused, which is accounting, and information that is transaction-focused, which is computerized information…

“The notion that you should split these two universes of information between the Chief Financial Officer, who is responsible for financial information, and the Chief Information Officer, who is responsible for non-financial information is not a good idea…

“The only reliable information we have available to us basically is “inside” information, mostly in our accounting systems. And yet, the events that really determine the success of business do not happen on the inside…So CFOs have a big job ahead: bringing together information channels, and learning an accounting system that’s going to be very different. It will require an ability to get “inside” information by manipulating figures quickly, and combining it with “outside” information, which is largely anecdotal today.”

The CFO as Financial Advisor:

“The Chief Financial Officer must think about the financial consequences of projected policies and actions, not only in terms of costs but in terms of the allocation of scarce resources…So the chief financial adviser’s job is to think about opportunity costs, and most CFOs don’t do this…As a CFO, you must think about what a policy or project is likely to return. Also think about the consequences if it doesn’t work…So the chief financial adviser basically is a conscience, a financial conscience.”

The CFO as Productivity Manager:

“There is a third CFO function, which is managing money for the business. I’m not talking of the treasury function; that is only a small part of it. The biggest part of this involves managing the productivity of capital…It’s my view that you can increase the productivity of capital in any organization three percent a year compounded, by just plain hard work, provided it’s allocated properly. And this is a function which is not, bluntly, on your professional agenda today…

“Top management doesn’t think financially. They think in terms of next quarter’s dividend, and that’s not thinking financially. They don’t think in terms of the financial impact of business decisions and the business impact of financial decisions. And that, I think, is your biggest educational job ahead.”

The CFO as Asset Protector:

“The fourth dimension of the CFO’s role is the preservation and protection of assets. This is a duty of a company that benefits not only the shareholders, but also society…The stupidest thing you can do is attempt to predict the future. Brilliant people have seen that those who predict eventually come to grief. Truly brilliant people understand that they must make external fluctuations irrelevant to their business…

“The protection of assets involves making sure that the risks over which you have no control are managed, and do not interfere with the conduct of the business. Losses based on fluctuations of commodities are no longer permissible, any more than it is permitted to have a factory burn down without insurance coverage. These are manageable risks.”

If you’d like to receive a copy of Peter Drucker’s complete remarks at the Phibro Energy Risk Management Forum in 1991, just shoot me a note.

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Tagged as #content marketing, #peterdrucker, #PRfirms, #publicity, #reputation management, #thought leadership, CFO, Chief Financial Officer, Claremont Graduate School, energy derivatives, energy marketing, energy risk management, integrated marketing, management consulting, management theory, marketing communications, marketing ROI, marketing strategy, Metropolitan Club, oil & gas marketing, Peter Drucker, Peter F. Drucker, Phibro Energy

December 19, 2012 · 10:58 pm

The Lost Marketing Art of Ink on Paper

Time to temper our love affair with pixels on a screen?

In a pre-pixilated world in the not too distant past, Ink on Paper ruled the world of marketing.

Capabilities brochures, annual reports and other print collateral – complete with blind-embossing, foil-stamping, perfect binding, die-cutting and spot-varnished photos – served to explain, sell and educate. Graphic designers used drafting boards, rulers and glue. They understood the difference between a sheet-fed and web offset printing press, could distinguish between thermography and engraving, and spent hours studying paper stock samples, typefaces and PMS color charts.

In the days of Ink on Paper, marketers reviewed press proofs; they hand-delivered advance copies of newly printed materials to their CEOs, and measured ROI based on Business Reply Card volume. Printed words and images did not move on the page. Content stood on its own, linked to nothing. And the US Postal Service was profitable.

There’s no denying the time and cost efficiencies of our online world. We now communicate more broadly, more precisely, more rapidly and with greater marketing insight than we could ever have imagined 20 years ago.

But we’ve lost a few things in our exodus from Ink on Paper:

Visceral Impact – Pixels on a screen have no weight, no dimension, no texture, no smell. Ink on Paper places something physical into a person’s hands. They open the cover and turn its pages. They can scribble notes in the margin, or rip out a photo. It’s a sensory experience that communicates on human terms, and that cannot be replicated by a PDF downloaded and created on a laser copier.

Personality – The range of creative expression using pixels is limited by the fixed dimensions of a flat glass screen. Ink on Paper lives on a canvas of unlimited graphic possibilities, in terms of size, shape, color and physical features. No scrolling is required to appreciate the design. It provides an opportunity to stand out from the crowd, to express yourself more effectively, and to make an impression that’s likely to be remembered.

Permanence – People scroll through computer screens at hyper-speed. The volume of information is unlimited, and no intellectual commitment is required of viewers. Ink on Paper moves in slow motion, forcing readers to pay closer attention to its content. Print materials possess presence and permanence, suggesting that the people and company who produced them actually exist, have nothing to hide and can be trusted.

Craftsmen in any field are quick to embrace new tools and methods that enhance their results and professional satisfaction. They also understand the importance of sticking with tactics that work well. Seasoned marketers who have thrown the baby out with the bathwater in their rush to digital communications, as well as more recent arrivals to the marketing profession who have always lived in a paperless world, would be well served to reconsider Ink on Paper as a medium.

No marketing communications program is truly integrated without that capability.

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Tagged as #content marketing, #craftsmanship, #graphic design, #marketing, annual reports, Business Reply Cards, capabilities brochures, direct marketing, Ink on Paper, integrated marketing, integrated marketing communications, marketing communications, marketing impact, marketing ROI, offset printing, PMS colors, print collateral, printed materials, snail mail, thermography, US Postal Service

November 27, 2011 · 10:48 am

B2B Marketing Strategies and Insights

Are You Wasting Money on Publicity?

The Value of Publicity is Based on 3 Key Factors

Every year, companies waste time, money and opportunity generating publicity that accomplishes little or nothing in terms of tangible business outcomes.

Here are a few hard truths regarding publicity:

Your audiences are unlikely to notice the exposure, or do anything about it. Even with content shelf-life driven by intelligent SEO management, there is simply too much information, too many online and offline media sources, and too little time in the day for your customers, prospects and referral sources to read, see or hear your message. And if they do get your message, there’s often little motivation for them to act on it.
Publicity volume does not translate into business results. A single high-value media placement that’s properly merchandised often has greater impact than a pile of press clippings. In fact, publicity for its own sake is often unfocused, with no connection to the company’s underlying value proposition or core messages; generating confusion and apathy among target audiences.
Some types of publicity have significantly greater marketing value than others. The old PR adage that “There’s no such thing as bad publicity” may work for Lindsay Lohan, but it has no application for companies that care about their brand. To calculate the media placement value of various types of publicity (see chart above), Highlander Consulting uses three key criteria:

BRAND RISK – If you have little control over how your company’s reputation or intellectual capital is presented – such as in a feature story where a reporter or editor will seek to produce “balanced coverage” by presenting negative items or including a competitor – then the publicity has inherent brand risk. (Value Scoring: +1 if you have total control over content; -1 if you have little or no control.)
CREDIBILITY – Often called “masthead value,” this factor is based on how well the media source is recognized and respected. The potential value of the publicity is based in large measure on the underlying credibility of the source, because the exposure supplies an inherent 3^rd party endorsement. (Value Scoring: +1 if the source has strong credibility; -1 if it has low credibility.)
MERCHANDISING POTENTIAL – This often overlooked factor is sometimes mistakenly called “reprint value,” but Merchandising Potential encompasses far more, relating to how easily and how broadly the media exposure can be leveraged to support and drive specific marketing goals. Simply posting publicity on a website does not deliver a high ROI. (Value Scoring: +1 if the publicity has a range of applications; -1 if it’s limited to one or two.)

Using this ranking methodology, and as reflected in the chart above , bylined articles and OpEd pieces published in credible sources typically deliver the highest marketing ROI; while inclusion (being mentioned or quoted) in a round-up news or feature story does not score well. Most home-grown efforts, such as self-published press releases, have very little value.

By using this formula, or a similar methodology, to evaluate the potential ROI of individual publicity tactics, and by building media and marketing strategies around only high-value activity,companies can consistently make the connection between publicity and tangible business results.