Why Chief Customer Officers are next in line for the CEO job
A cohort of tech-savvy executives trained to hit revenue targets and keep customers happy are emerging as the top candidates to fill CEO vacancies.
The Chief Customer Officer role is proving to be a critical training ground for executives who have their eye on the top job, recruitment experts say.
The CCO role has become one of the most significant leadership positions in many companies because it typically includes responsibility for revenue, data, and analytics and an understanding of customer behavior, executive search specialist Jason Johnson says.
“It really is forming up as almost a deputy CEO type role, given the way that many of these roles are being structured,” Johnson says.
It is also a pathway to becoming a chief executive officer.
Olivia Wirth, CEO of Qantas Loyalty was formerly the chief customer officer at Qantas, while David Koczkar was promoted from CCO to CEO of Medibank in May this year.
Experience in managing a profit and loss account, owning key customer channels, and strong data skills make CCOs compelling candidates during the executive search process, Johnson argues. The role has also gained authority within organizations as businesses compete to keep customers happy.
“As organizations have pivoted to become much more customer-centric, it’s the role responsible for ensuring that the customer journey is and the customer experience is world-class,” Johnson says.
Chief customer officers are in a unique position to represent customers at the executive level and help the organization develop new products and services to meet their needs, the Medibank chief says.
That same mindset – putting customer needs at the center of your decision-making – is also a key requirement for CEOs, he adds.
“Understanding and delivering against the needs of customers is fundamental to business. Many people and many companies have lost sight of that,” Koczkar says.
“You’ve got to start with a belief that the reason for being in business is that customers have the choice and your role in business is to meet and exceed their needs. If you don’t do that they’ll go somewhere else.”
Former BOSS Young Executive, Catherine Anderson says her role as the chief customer officer at Powershop was a great training ground that prepared her for a six-month stint as acting CEO while the energy retailer conducted a search for a permanent chief executive.
“I was excitedly nervous for that role,” says Anderson, who has returned to her CCO position and is responsible for marketing, sales, customer service, and customer care.
Both CEO and CCO roles require keeping an eye on day-to-day operations as well as what’s on the horizon that could disrupt the business, Anderson says.
“Chief customer officers are pretty commercially savvy people. We’re responsible for balancing customer demand, market trends, and future trends against having to deliver business success.”
One of the critical skills she has developed as chief customer officer is to bring together different parts of the organization that has different priorities, to focus on a customer problem.
As a new addition to the C-suite, the remit and the authority of the CCO can vary between companies. According to Koczkar, it’s important the role is well-resourced and has an internal mandate to make changes.
“I see some chief customer officers being able to be great listeners and being able to understand the needs [of customers] but not having the internal authority or networks to actually make that a reality,” Koczkar says.
There are lessons for aspiring executives in the CVs of chief customer officers, notes Johnson.
“It’s not unusual to bring a combination of marketing, sales, product development, and even some technology, given how pervasive technology is in driving a much more customer-centric outcome to the role.”
Johnson recommends aspiring CCOs move horizontally across an organization, gaining skills in multiple parts of the business rather than progressing in a single business function.
“For example, start in marketing, move across to sales, spend time in data and analytics, in the digital team, and running the contact center. That combination of skills would be a very compelling mix when assessing internal talent,” he says.
Johnson anticipates there will be an influx of international arrivals taking up CCO roles locally as Australia’s international border reopens.
“CCO roles are so valuable, and they are going to be hotly contested, but there are just a handful of executives that have that full suite of tools in their toolkit already,” he says.
–Tess Bennett, AFR