Jim Compton has a unique title. Several years ago, while at Continental Airlines, he became one of America’s first Chief Revenue Officers. The idea behind his title: a C-suite executive with a laser focus on revenue generation.
When Continental Airlines merged with United Airlines in 2010, that role in the newly formed organization did not exist. That is, until a few months later when Compton became the Chief Revenue Officer of the fresh – and much larger – airline.
Years later, Jim remains one of just a handful of Chief Revenue Officers at major U.S. corporations, which is surprising given the rise of Revenue Management, and the increasing importance of organized revenue growth among Fortune 500 companies.
When I wrote my book “Revenue Management: Hard-Core Tactics for Market Domination” in 1996, I introduced the idea of the Chief Revenue Officer and stated that it was vital for corporate companies to have one.
However, this title remains to be a significant hole in the executive suite. Perhaps that’s because many Chief Executive Officers and Boards of Directors still don’t understand the role. The Chief Revenue Officer provides the perfect counterpoint to the CFO. Where CFOs are clearly and singularly responsible for expenditures, CROs would be clearly and singularly responsible for revenue. The Chief Revenue Officer can help facilitate future business growth, and can transform the way a company does business. There are many keys to success in this role in order such as:
- Identifying and articulating market requirements to prioritize R&D, product planning & production scheduling as well as revenue forecasting.
- Getting unified agreement on recommendations marketing, pricing, promotions & sales before presenting them to the Chief Executive Officer. This helps drive accord on revenue generating issues – and avoid mistakes and miscommunication – between disparate parts of the revenue side of the business.
- Convincing the company to invest in Revenue Management capabilities to drive future firm growth. This commitment of capital is critical to making Revenue Management as powerful as it needs to be and keeping it top of mind in the C-suite.
- Working in partnership with the Chief Financial Officer. This insures that the Chief Revenue Officer and Chief Finance Officer are working harmoniously, even attending investor meetings together to demonstrate that the revenue side of the business understands what’s needed in terms of returns to shareholders and growing the business.
A Chief Revenue Officer provides a more focused and consistent lens on revenue generation drives revenue creation across an enterprise, and serves as an invaluable advisor to the Chief Executive Officer. Given all of the wisdom and value that a Chief Revenue Officer can bring to an organization, this role should be standard in corporate America.