The purpose of the chief revenue officer is to drive organic revenue growth by leveraging all revenue-generating departments, including marketing, sales, customer support, pricing and revenue management. The CRO guides all revenue-related activities, maintains an excellent communication framework across various organizational functions, and shares best practices among revenue stream managers to maximize revenue and create organic revenue growth.
“The job is about the scalability and synchronization of all revenue functions.”
How does the CRO differ from the CFO? Think of the CRO as being responsible for “anywhere revenue has touched,” says Jim Compton, who became Continental Airlines’ first-ever CRO in the 2000s and today holds the same title at United Airlines. His direct reports include the heads of global sales, revenue management, marketing and customer loyalty programs, who work through him to reach a unified agreement on recommendations before presenting them to the CEO.
Jeff Foland, who became Hertz’s first CRO in January 2015, says the job is about the “scalability and synchronization” of all revenue functions. Companies that don’t have those functions “appropriately stitched together” miss out on “a synchronized and concerted effort to really move the needle on how you’re going to generate incremental revenue.”
CEOs mulling whether to create this new role should know that chief revenue officers can aid in everything from product creation and pricing strategies to sales performance and the effectiveness of advertising and distribution.
CEOs should look to fill this position if they want someone in the C-suite who will:
- Identify and articulate market requirements to prioritize R&D, product planning & production scheduling as well as revenue forecasting.
- Advocate for investment in Revenue Management capabilities to drive organic firm growth.
- Demonstrate that the revenue side of the business understands what’s needed in terms of returns to shareholders and growing the business, work in partnership with the Chief Financial Officer, and even attend investor meetings.
Overall, the hiring of a chief revenue officer can deliver improvements and/or efficiencies as high as 10 percent.
The CRO role brings a fundamental change in the organizational chart, which may scare some companies. But it also provides precision and a consistent lens on revenue generation, while serving as an invaluable advisor to the CEO.