Consumer-driven companies are undergoing major transformation. They face significant new challenges in their quest to remain relevant and provide value to consumers and shareholders.
Today’s customers are looking for a seamless experience with access everywhere and any time. As a result, companies are rethinking many basic principles in order to be agile and flexible in their responses to the market and, ultimately, to grow their businesses.
An emerging strategy to drive growth is to create an executive role that provides a growth-focused, holistic, company-wide view – a chief growth officer (CGO).
The CGO role first emerged in media companies and agencies around six years ago. The role has since gained popularity in consumer products companies, with the US leading the way, and, more recently, large retail companies have introduced this cross-functional, transformation-focused role.
How to characterise the CGO? According to Russell Reynolds Associates’ recent study, the first generation have been charged with creating new pathways to growth by optimising limited resources, maximising the impact of investment and keeping an eye on the future.
Much more than a glorified chief marketing officer, the CGO is arguably the most powerful in the company after the chief executive. They serve as the chief's span breaker, ensuring they can focus on strategic tasks while acting as a peer to divisional and regional heads to help them operationalise the company-level growth agenda.
The CGO is also an advocate for the increasingly powerful consumer and exists in a nexus between the changing dynamics of marketing, commercial operations, innovation and growth. They are typically a powerful direct report to the CEO and accountable for providing an end-to-end view of the business and enterprise-wide growth.
The CGO is arguably the most powerful in the company after the chief executive.
This represents a structural shift at the top, with marketing reporting into the CGO in support of the overall growth equation.
The growth officer plays three critical roles in modern organisations. First, as a trusted advisor and challenger to the CEO. It is not surprising that in the first wave of CGOs, the majority (57%) are internal appointments.
Additionally, in the case of an external hire, 71% have a significant prior working relationship with the CEO of the company they are joining. Secondly, the CGO is an accomplished brand builder with P&L experience – ensuring customer-focus and commercial grounding. The third facet of the role is as an internal connector who aligns conflicting agendas to ensure a seamless consumer experience.
In addition to the benefit of fueling company-level growth, the creation of the CGO role brings a number of added benefits to organisations, including speed, less duplication of activities, lower bureaucracy and greater transparency and accountability.
The CGO can also help to reorient brands and businesses towards what is needed for the future, rather than what has been built in the past.
The CGO’s remit is a pivotal, high-pressure and unashamedly commercial one. As the role matures we will see a second wave of increasingly influential, game changing executives emerge – in the same way as digital and data leaders before them. Far from being a flash in the pan, CGOs are the CEOs of the future.
Jo Renea is executive director at Russell Reynolds Associates