Sixty-nine percent of marketers plan to have an analytics Center of Excellence (COE) by 2017, according to the Gartner Data-Driven Marketing Survey. COEs are not exclusive to analytics — they exist across a range of marketing capabilities including social, search engine marketing and digital commerce. The COE is now a structural archetype within marketing organizations.
With this growth in interest comes a corresponding growth in the misapplication of the archetype and confusion with other sourcing models, said Ewan McIntyre, research director, Gartner for Marketers. To effectively leverage this organizational model, it helps to understand what a COE is and when to establish one.
What is a COE?
Gartner defines a COE as a physical or virtual center of knowledge concentrating existing expertise and resources in a discipline or capability to attain and sustain world-class performance and value. This definition can be broken down into four key elements.
First, COEs need to focus on a tight scope defined around a specific capability such as marketing analytics or digital commerce. Next, consider the location of the COE (physical vs. virtual). Third, COEs should optimize and leverage resources internal to the organization, not external vendors or agencies.
Lastly, COEs should focus on pushing beyond standard performance norms to deliver incremental value to the organization. COEs should not conduct business as usual around a capability. Instead, drive toward excellence in a medium or a channel.
When to use a COE
COEs are often confused with other sourcing models, like shared services, governing councils or cross-functional teams. “The term COE is often used to describe a centrally organized function,” said Mr. McIntyre. “But it’s not a blanket solution for every situation.”
Use this checklist to gauge if a COE is appropriate for your organization. COEs are worth exploring when various conditions exist:
- Specific capabilities are needed
- Specialized knowledge is required
- Knowledge is difficult to acquire
- The capability is important to the business
- Central oversight is required
- Organization culture and size align to the COE model
- The capability is relatively homogeneous
Read More: Introducing Marketing-Led Digital Commerce
An example COE
While many organizations deploy a COE model to accelerate analytics capabilities, digital commerce also lends itself to this type of organization. A digital commerce COE would be a group of experienced (internal) commerce professionals with a specific mandate to drive better performance against commerce goals. They would elevate commerce capabilities across the business. The team will be composed of diverse yet specialized expertise, including merchandising, ratings and reviews, demand planning, search engine marketing, affiliate marketing and user experience. The members of the COE will share a singular focus and scope — empower commerce execution teams to improve digital commerce results for the business.
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