OpenText, based in Waterloo, Ontario, is betting that CIOs will want to reduce their organization's use of cloud-based services and bring them in-house because it will eliminate complexity, risk, and cost.
The company specializes in enterprise information management systems. It recently announced its Web Experience Management (WEM) software suite designed to help enterprises boost their marketing and sales through more effective web sites and digital marketing. OpenText believes it makes more sense to run the software in-house.
I recently met with Kevin Cochrane, CMO of OpenText. Here are some notes from our conversation:
- CMOs are putting pressure on CIOs to provide better IT support and to understand what they are trying to do.
- CMOs were in trouble five years ago and the average amount of time they spent between jobs was just 18 months, now it's three years. This shows that CMOs are figuring out how to succeed as their organizations become more digital.
- CMOs now know what they want, and what they need to be successful. They want a single view across their marketing channels, programs, and all the other silos. They want their CIOs to know how to provide that service.
- Companies have been using various cloud-based services but this doesn't integrate into the single view that CMOs need.
-The CMO wants marketing services from the CIO but this requires that the CIO understand the business requirements while the CMO needs to understand how costly using third-party services is to the organization.
- There's a lot to be said for using an in-house software suite that runs on your data center. It cuts costs -- cloud based services can get very expensive and sharing data between them and in-house systems is difficult. It's better to have everything running on one system.
- Cloud based services carry many risks, organizations are very concerned that sensitive customer data will be exposed to hackers, or criminal groups.
- WEM replicates many different cloud-based marketing solutions combined with detailed analytics that shows engagement and other important business statistics. Plus, it never goes away, unlike if a service provider goes bankrupt or is sold to a new owner that makes changes, companies have few options.
- The privacy issues around the cloud are causing a lot of companies to reevaluate how they use the cloud.
- The cloud isn't going away, the future of the enterprise is a hybrid IT architecture where critical business services are run by the IT department.
Kevin Cochrane sees a large gap between the CMO and the CIO, and that the CIO needs to cross this "digital divide" over towards the CMO, and provide the IT services needed in the increasingly complex world of marketing, which has to operate across multiple, fragmented media channels.
OpenText's WEM suite is designed to provide out-of-the-box IT services for a CMO's needs and replace the use of some outside services. But it's likely best used in organizations that have yet to implement some of the sophisticated media technologies that are available. The successful CMO that knows what they are doing, is already doing it using a hybrid mix of internal and external IT. And convincing people to change what is already working is not realistic.
However, the use of the cloud is causing problems for many corporations, the increased business risk from an insecure cloud is a big worry. Customer data is the crown jewels of every company but more and more of that data and the metadata around it, is held in cloud-based services uaed by marketing and sales departments. CIOs will certainly want to reduce that risk by replacing the need for cloud based services with internal services. If OpenText can demonstrate that its software is up to the demands of what a CMO needs then that will help the CIOs that are trying to bring more services in from the cloud.
But this requires CIOs that understand what CMOs need, they have to speak the same language and that's not easy. The CMO's job is probably the most difficult job of all in the C-suite. Digital marketing's constantly shifting rules, metrics, and processes are difficult to understand and track. It would require a CIO with the skills of a CMO. Maybe that's the skill set that enterprises will look for in the future but it's not the case today. Educating the CIO to think like a CMO is a tough call given all the other things that need to be done in a large enterprise.
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