Look “Operations” up in the dictionary, and you will see:
“the condition of functioning or being active“.
Interesting. Being active makes me think of sports, games, arts and crafts, being healthy and fun. I’m picturing playbooks, creating beauty and functionality, and workouts and outdoor recreation. All of these are sexy things, right?
But what does this mean in a business environment? According to the Business Dictionary:
“Operations transform resource or data inputs into desired goods, services, or results, and create and deliver value to the customers.”
Transforming and creating value sounds powerful.There seems to be awesome potential in the Operations role.
MIT’s Sloane Management School says:
“Operations Management deals with the design and management of products, processes, services and supply chains. It considers the acquisition, development, and utilization of resources that firms need to deliver the goods and services their clients want.”
Clearly there are both strategic and tactical elements of Operations. Design and management reinforces the create and deliver value phrasing mentioned above. Acquisition, development, and utilization of resources reinforces the importance of transforming and being active. Resources is a broad subject: budget, data, people, technologies, tools, know-how, processes. All of which are scarce and precious in any organization, relative to potential opportunities. The challenge of transforming and creating value among an organization’s broad set of resources strikes me as very intriguing.
Another interesting dimension of this role is found in Wikipedia:
“The outcome of Business Operations is the harvesting of value from assets owned by a business. Assets can be either physical or intangible. . . . Business Operations encompasses three fundamental management imperatives that collectively aim to maximize value harvested from business assets:
- Generate recurring income
- Increase the value of the business assets
- Secure the income and value of the business
The three imperatives are interdependent. The following basic tenets illustrate this interdependency:
The more recurring income an asset generates, the more valuable it becomes. For example:
- The products that sell at the highest volumes and prices are usually considered to be the most valuable products in a business’s product portfolio.
- The more valuable a product becomes the more recurring income it generates. For example, a luxury car can be leased out at a higher rate than a normal car.
- The intrinsic value and income-generating potential of an asset cannot be realized without a way to secure it. For example, petroleum deposits are worthless unless processes and equipment are developed and employed to extract, refine, and distribute it profitably.
The business model of a business describes the means by which the three management imperatives are achieved. In this sense, business operations is the execution of the business model.”
If that’s not sexy, what is? Applying the above definitions to Marketing organizations, Marketing Operations must be the execution of the marketing strategy, aimed at creating/harvesting value by enabling the company to grow revenue and increase asset value, and transforming Marketing resources into further value for the business. That is certainly strategic.
“The purpose of Marketing Operations is to increase marketing efficiency and organizational agility. Agile marketing organizations are able to adapt their marketing efforts, quickly and successfully, in response to changing customer behavior, market conditions and business direction to the benefit of improved market share or customer value. Typically, Marketing Operations is the function responsible for marketing performance measurement, strategic planning guidance and execution, budgeting, process development, professional development, and marketing systems and data. The role is increasingly responsible for affecting change in the marketing organization. The MO function enables the marketing organization to shift from being viewed as a cost center to operating more like a business, with formalized best practices, processes, infrastructure, and reporting.” — Wikipedia
Somehow the word Operations has a mundane connotation for some people, especially marketers. Sometimes Operations is very tactical, putting out fires, getting in the weeds of technology deployments, cleaning up others’ messes, and harping on everyone to follow rules or report their status.
That’s a shame, because there’s so much potential value for everyone in Marketing, as shown in the definitions above. Think of it this way: the more streamlined a Marketing organization’s processes and policies and resourcing are, the more marketers can concentrate on what they do best! Harnessing the chaos frees up the creativity. Now that is sexy.
It’s up to the Operations role and top executives to position Marketing Operations as a transforming value-creator. It’s time to revise your roles and responsibilities to include the strategic elements of what Operations really is. Be active at a higher level, enabling efficiency and effectiveness of all of Marketing’s resources. To help all of the Marketing functional areas to be active in what they do best. Rise above the fray and claim your place in driving the Marketing organization’s success.
by Lynn Hunsaker, president of Marketing Operations Partners