Wednesday, May 07, 2008
Results vs. Costs
byBecause the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs.
– Peter Drucker
The quote above is from Peter Drucker’s book, Innovation and Entrepreneurship. The book was first published in the 1980s, and it was re-released a couple of years ago. It is still sound advice. If you want to improve business, marketing and innovation had better lead the way. Considered by many as the preeminent business consultant and author for decades, Drucker is the person who coined the term knowledge worker.
Considerable effort should be spent on measuring the success (or failure) of marketing and innovation. Why? Another famous Drucker quote answers that question: “What’s measured improves.”
In the not-to-distant past, marketing was often given implicit permission to operate with squishy numbers (unaided awareness, gross impressions, share of voice, etc.), to justify its existence in the enterprise. Those days are over. Companies intent on thriving today, are the ones who can access important information throughout the sales and marketing funnel and apply this information to immediately improve the next round of efforts. In addition, it is the feedback solid numbers provide, which affirms to the finance side of the business that marketing and innovation are truly strategic investments and not costs.
