As a leader how do you build growth capabilities faster?
As the chief marketing and operations officer (CMO) for Microsoft Asia Pacific, Justin Spelhaug had seen the pace of change accelerate in an ever faster-changing industry.
Since its inception over 40 years ago, Microsoft had become one of the world’s most successful IT giants, but as the tech industry changes at breakneck speed, it was also having to learn how to learn faster and act faster. So, the company had started using a data-driven, “test-measure-iterate then build” approach to growth that increased its ability to innovate in sales and marketing.
Justin was accountable for all aspects of marketing and go-to-market execution. He was keen for the team to experiment with some new approaches to marketing, but was concerned to hear his team express frustration over lack of freedom and resources to try out new approaches in the discipline. Justin was convinced they had more freedom than they felt. He needed to drive results, but he also needed to help his team think differently about what they could or could not do.
Justin decided to try a different approach. Rather than try to convince people to change their attitudes or beliefs, he asked them to innovate in new ways. He set up five teams and gave each $10,000 and 45 days to develop and test an innovative marketing idea.
This approach was very different from what they’d done in the past. Previously, marketing relied almost entirely on return on investment (ROI) as the key measure for success. This measure drove a lot of caution and emphasis on large, tried-and-tested approaches. For his experiment, Justin focused the team almost solely on a measure called learning on investment (LOI) to determine the value of the project. The aim was to learn as much as possible and then act as fast as possible to implement successful ideas across the business. The team was intrigued by the chance to try something new, but not convinced it would lead to real benefits to the business. Justin pushed ahead.
One of the five teams chose a project related to a game built on SQL Database. The game was a huge hit with techies. Initially, Justin didn’t think the game made sense or that anyone would pay any attention. Had Justin followed his gut instinct, he never would’ve chosen it as an experiment. However, technical administrators loved the game. With this gamification model, they achieved more engagement than with any other marketing tool.
The small experiment had very high LOI. Following this trial, the team made the game their primary advertising engine for SQL. When evaluating the impact of the experiment, they found that both engagement and revenue conversion, two key measures of success in online advertising, were very high.
Another one of the experiments wasn’t a great financial success, but the LOI was very high. The team built on the insights gained and eventually used the learning in a successful marketing campaign in another country.
Justin’s experimental approach allowed the marketing team to try out and test several approaches quickly. By formally stating hypotheses, setting up a study design, and gathering data to evaluate the outcomes, the teams could learn quickly and at the same time, they delivered two marketing campaigns that had high short to medium-term impact.
Justin’s story is a great of example of how growth leaders need to respond when a business needs to speed up fast. The key takeaways for growth leaders are:
- You can change behaviour with the right routines more easily than you can change core beliefs or culture.
- Getting others to take some personal risks requires their leaders to take some personal risk first.
- The more customers and business decision makers differ, the more important it is to avoid gut instinct.
- Small experiments can lead to big results.
- The right method, data and research are great tools for organisational learning.