The role of Chief Revenue Officer has evolved into a core executive function within modern B2B businesses since its emergence over the last 6-8 years.
B2B CEOs in the tech sector now consider CROs as core pillars of their leadership structure. CRO is the “hot” new title in the B2B space. The coveted title comes with many spoils: prestige, power, credentials and the promise of future opportunity.
However, the appointment also comes with huge expectations and risks. Often, CROs are seen as a miracle-worker, rainmaker, and a mover and shaker who will come to the rescue by taking the company to the next level of sales revenue growth.
It’s no wonder then that many CEOs have a relatively narrow view on the qualities that an effective CRO needs to bring with them into an organization. Equally, very few organizations prepare themselves properly for the advent of their first CRO.
False expectations and under-preparedness can lead to less than hoped for results, frustrations and wasted expense, time, and effort. The risk for a CRO appointment to go wrong is huge, as are the consequences, for the CRO, for the organization and for the CEO.
Here at the CRO Collective we have observed a myriad of perceptions as to the actual responsibilities of a CRO.
- How does a CRO function?
- Where does a CRO sit within our organization?
- Where should their functional focus be?
- What are their areas of oversight, scope, remit and accountability?
This lack of clarity can have dire implications to firms who currently employ CROs and for future CROs who aspire to take on this coveted role, unaware of the nuances and requirements the role actually demands.
For those considering taking the step into a CRO appointment, the risks of getting it wrong are huge, but so are the rewards for getting it right. For those who are already in the role, investing the time into re-evaluating your skills and competencies may make the difference in tackling the challenges that you are no doubt already facing. The CRO is a lonely position, and the benefit of insights specifically for CROs could make the difference between success and failure. The best place for an aspiring or current CRO to look for perspective is in the eyes of the person who will be hiring you and holding you accountable: The CEO.
With that, three important questions become apparent:
1. What are the real signs an organization needs a CRO?
The answer to the above question may come as a wake-up call to CEOs who seek a magical rainmaker. Without a clear understanding of why a CRO is needed and what their actual role should be within the company, a half-million-dollar compensation package could quickly turn into a bad investment and risk loss of revenue, reputation and personal advancement.
For a leader this critical to the success of the organization, we recommend CEOs first ensure that their company is structured properly to enable the real outcomes that a CRO is brought in to deliver. Without the right culture and organizational design, even the most qualified CRO will have a tough uphill battle to fulfill their remit and live up to expectations.
2. What is the proper structure and culture that a CEO must create in order to successfully bring in a CRO?
Ask yourself: What needs to be in place before they join? Who needs to be involved and signed on to make a CRO successful? Let’s face it, without the right foundation, a CRO placement can turn from an opportunity for renewed growth into business disruption that can plunge the business into chaos. Once the organizational structure and culture are in place, it’s now time to bring in the right CRO to activate the new growth and revenue success. Yet, the hardest part is still to come. A CEO must first know how to find a good CRO.
3. What are the qualities of a good CRO, and how does a CEO find the right one?
Without first having a very clear understanding of the right qualifications, attitudes, experience and skills that a good CRO must possess to be able to hit the ground running and to perform from day one. Once the qualities, competencies, skillsets and characteristics of a good CRO are clearly defined, a CEO will have a proper benchmark to evaluate candidates. This clarity will mitigate the risk associated with bringing on an extremely expensive executive – and who will have a massive impact, good or bad, on the business – who is wrong for the job and for the organization.
Bringing in a CRO could be the greatest thing for a CEO, or it could turn out to be an unmitigated disaster.
To evaluate your own CRO Readiness, I invite you to complete my CRO Competency Checklist. In just a few minutes you will gain clarity on what you can do to give yourself the best chance of success in your appointment as a CRO.
Warren Zenna is Founder and CEO of CRO Collective.