The role of the Chief Commercial Officer (CCO) has existed for the last few years, but its prevalence across large, mid-market, and SMB organizations is on the rise. More and more, CEOs are opting to place CCOs in the top commercial leadership spot as opposed to more traditional titles. The CCO has replaced Chief Revenue Officers (CROs) and Chief Marketing Officers (CMOs) as the primary person responsible for developing and executing on a revenue growth strategy.
SBI recently hosted a CCO Growth Advisory Board meeting. Find major themes from the session and download insights from the discussion here.
Why Are CEOs Making a Shift to a CCO?
But why are CEOs making the change to CCOs instead of the tried and true methods of the past? While a few factors are at play, the most meaningful is the need for single ownership across the entire revenue function. This includes the traditional functions of Sales and Marketing, Customer Success, some aspects of Pricing & Packaging, and the Revenue Growth Office. The belief is that by having a single owner, this person has visibility across all the “pieces” touching revenue and the customer, thus creating better execution on the revenue growth strategy and improving the customer experience.
The emergence of the CCO does not mean that CROs (or some form of a more traditional “revenue leader”) and CMOs (or some form of a more traditional marketing leader) are no longer needed. They still exist in this organizational structure (typically not as a C-level but as one reporting to the CCO) and own their respective functional strategies; it’s just that they no longer are reporting directly to the CEO. With so much already requiring the CEO’s attention, having a single Commercial leader as opposed to 2, 3, or 4 individual functional leaders is advantageous.
What Does a CCO Do That a CRO or CMO Does Not?
Given all of this, we are often asked what changes and/or additional responsibilities a CCO has that a CRO or CMO does not. While it’s never black or white, the primary difference in CCO responsibility is that they own developing the Revenue Growth Strategy. This consists of four key components; they are:
- Revenue Levers are the company’s strategic approach to growing revenue. It centers around a decision whether to grow organically or inorganically. This is the first thing CCOs must decide, and it impacts the rest of the company’s growth strategy and aligns with the broader corporate strategy.
- Revenue Model is the company’s approach for generating revenue across its portfolio of solutions and products. The CCO must evaluate the 13 different revenue models that a company can deploy and determine which model(s) are most effective and for which part of their business. This is a critically important and strategic decision that must be made in conjunction with the CEO and CFO.
- Go-to-Market Model is the company’s approach for allocating commercial resources across different markets, accounts, and partners, as well as defining the routes to market. This decision dictates the setup of the commercial organization and has many downstream impacts relative to the company’s organizational structure, revenue marketing tactics, compensation and quota philosophies, and more.
- Customer Experience is the last primary responsibility CCOs have. One of the most challenging aspects of a Revenue Growth strategy, CCOs are tasked with this given their purview across the entire revenue cycle and ability to influence this using multiple levers. Typically, ownership of the CX responsibility is fragmented across different functions within a company. Having the CCO own this provides the company with a much greater ability to drive an optimal CX.
While a CCO is ultimately the accountable party for the above four efforts, they work very closely with the individuals who own the revenue and marketing efforts on a day-to-day basis in their teams. That said, CEOs value having the CCO as the person directly accountable for these critical decisions, given their connectivity to the company’s strategy.
We expect to see the role and prevalence of Chief Commercial Officers continue to grow in the short and mid-term. As it does, their responsibility to drive a clear, consistent, and effective Revenue Growth strategy that has the four critical elements defined will only be more important. If you are a CEO evaluating whether the CCO role is the right move for your organization, feel free to contact us, and one of our Revenue Strategy experts can help talk your options through with you. And don’t forget to download the CCO Customer Advisory Board insights as reference.