dgroup • Building the Marketing Organization 2.0 — The Transformation to an Agile Way of Working

Marketing has developed more into a science, requiring technical and data analytics expertise. The constant emergence of digital channels forces marketing organizations to transform their way of working into an agile one, iterating much faster to adapt to rapidly changing market conditions.

Moving from a linear to a connected experience

The way businesses traditionally connected with customers has been linear, following the traditional purchase funnel. Nowadays consumers can interact with networks of people, following your brand through diverse social channels, asking for help in your support forums or download software or any other digital content directly from your website. This new interactions transform the linear path to purchase into a connected experience. Customers are more informed and make decisions that lead to better personal outcomes and are constantly redefining the very notion of value and how it is delivered to them through many different channels. On their way through the connected experience, customers leave a whole bunch of data behind that can be captured and analyzed by marketers.

Most marketing organizations, however, are still not capable to deliver to the new expectations that arise from a connected experience. Many of them still work with traditional models for planning, executing and measuring their marketing plans, following the classic “waterfall” project plans. The key to building the greatest value a CMO can deliver is by different departments and business units that collaborate and are able to adapt to the rapidly changing customer needs during a connected experience led by digital channels.

What does agile mean

The origin of agile project management lays in IT organizations working with SCRUM in software development. The basis is to break down ideas into so called “Epics” that describe the high-level requirements and are used to discuss them with other stakeholders. An example would be the creation of a customer loyalty program. The epics are then broken down into single realizable user stories that are estimated regarding their effort and prioritized into regular sprints that are released in frequent intervals. An example for a user story would be: “As a customer I would like to get reduced prices as a loyalty program member”. The prioritized user stories are specified by their product owners and tested after successful development (see illustration 1 for detailed process). The de-prioritized user stories are saved in a product backlog for future prioritization. The scrum master facilitates the team and product owners by removing barriers, encouraging creativity and keeping all parties informed about the current state and progress of the team.

The journey to an agile marketing organization

Transforming the marketing organization into an agile, more collaborative organization is a significant challenge that requires a strategic mix of standardization and flexibility to enable teams to anticipate changes and execute quickly. The journey to an agile marketing organization follows usually four steps:

1. Analysis of status-quo:

This assessment includes the definition of the state of core marketing functions, processes, tools and techniques for marketing planning, execution and measurement as well as the structure and expertise of the existing team. This analysis is the basis to create several user stories and assign them to the team.

2. Organization of the team:

In order to become agile, cross-functional teams have to be established who work in sprints to plan, execute and deliver the defined user stories. The team is split into three roles:

• The product owner who represents the customer voice, organizes user story workshops, owns the project backlog and plans the sprint releases
• The scrum master is responsible for the overall budget and progress of the project. He runs the whole planning and removes “blockers” that hamper the team’s progress. He also trains the whole team on the agile process
• The remaining delivery team is responsible for the execution and testing of all tasks

3. Plan build and test:

The biggest challenge for marketing teams is to work in agile’s fast and iterative project sprints. Each sprint contains different steps over a defined time interval — usually two to four weeks:

• Planning: Identification of the scope
• Prioritization: Prioritization of user stories
• Estimations: Effort estimation of prioritized stories
• Scoping: Final prioritization of user stories based on effort estimates and available capacity
• Specification: Specification of prioritized user stories for the next sprint
• Execution: Implementation of prioritized user stories
• Review: Review and testing of implemented user stories

4. Review and refine:

After each sprint the project team reflects on the process of working together, gathering input from various stakeholders to identify gaps that can be addressed in the next sprint. This leads to an improved collaboration from sprint to sprint and is the key of an agile work mode.

Spotify as best practice agile organization

Spotify is organized in so called “squads. There are more than 30 squads scattered across different countries, covering more than 250 people and each squad behaves like a lean startup. Each of the squads focuses on a specific function, e.g. radio, and iterates on a minimum viable product, releasing on a regular basis. All squads have their own workspaces, lean management structures and are led by a product owner. Related squads are grouped into “tribes”, e.g. infrastructure, and behave as incubators for the squads. In this way the squads are connected and communicate with each other via the tribes. For further interaction and functional knowledge exchange there are also larger aggregations of squads to so called “chapters” and “guilds” (see illustration 2).

With this agile organization Spotify is able to pool experts into squads with a defined focus on a certain product feature to rapidly increase the functionality and quality of the platform in a minimum of time in regular intervals.

Major challenges of the transformation

Formerly marketers worked six months on developing and testing campaigns and were not able to respond to intermediate changing customer expectations. In contrast, an agile marketing organization is able to speed up the development of integrated marketing initiatives, apps, and websites and to adjust to changing customer demands at any point. But becoming such a flexible agile organization is accompanied by several challenges:

• Established structures prevent organizations from adopting new processes. Executive sponsorship of top management and C-level ambassadors demanding new innovative processes help to overcome this challenge and to support an organization wide transformation
• Another challenge is that the current pool of agencies working with the organization do not follow an agile approach and therefore a pitch for new partners if often inevitable. The cooperation with agencies that have digital expertise are often capable to work in agile environments
• In addition to the top management support, huge investments in a new IT architecture and external support that drive the transformation to an agile marketing organization are required. The best way is to work together with external consultancies that focus on digital transformation and have experience with agile project management

A marketing organization that is willing to take these challenges in order to become an agile organization that acts more like a technology company will be best-in-class in meeting customers’ expectations.

If you are interested in knowing more about the topic or need help in this area, please do not hesitate to get in touch.

Sebastian Straube is Analyst at dgroup. He has worked in several agile projects with various retail clients, focusing strongly on digital B2C and B2B topics.

Originally published at www.d-group.com.