ANTONIO LUCIO, CMO OF HP

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REINVENTING LEADERSHIP

Before I sat down with Antonio Lucio, Chief Marketing and Communications Officer of HP, I had the pleasure of touring HP’s Welcome Center, which really brought to life the wonderful history of HP with the exciting promise of tomorrow. As Antonio is on a mission to build a brand than can stand the test of time, we began by defining his role as CMO, what it is today, how it’s evolved and what it needs to become in the future.

What I’ve always found captivating and admirable about Antonio is his incredible connectivity to humanity and his personal sense of responsibility to not just talk about solutions, but inspire an industry to unite for results. He is not only an effective leader, but a gracious collaborator with his peers both inside and outside HP, many of whom he references in our session. But make no mistake, Antonio is not just a marketing leader with a social purpose, he is a business person first and foremost.

In our session, Antonio shares how he is able to connect the dots between emotional connectivity with consumers, true engagement of employees and reinventing mindsets to deliver financial results for HP. In fact, in his recent annual review and Board meeting, both his CFO and his board suggested that HP should be spending MORE money in marketing! When is the last time you heard that?

Want to know the moves he made and how Ricky Martin happens to become part of this conversation? Well, you’re just going to have to listen to find out…

 

TRANSCRIPT

Antonio Lucio, CMO of HP - Reinventing Leadership

Nadine:    Hello everyone, and welcome to CMO Moves. Today, I have the great pleasure of being here with Antonio Lucio, who is the Chief Marketing and Communications Officer for HP. Antonio, hello and welcome!

Antonio:   Nice to be with you here Nadine, and welcome to HP.

Nadine:    Well, thank you. What a gorgeous building, and what a fantastic tour. I mean, I cannot believe how much work you've put into this building. It just looks gorgeous.

Antonio:  It is great to be in a place where our founders were, so having the offices of Bill and Dave here, together with our very modern customer center, is a source of inspiration, and also the symbol of the company that is anchored in history, but it is inspired by the trends and new opportunities.

Nadine:  Yeah, absolutely. Wow, I've just been amazed, walking around and seeing the history coming together with today's real life. You know, that somebody in the corner practicing on VR equipment and then all of sudden there's, you know, posters from 1944.  It's amazing how it blended together so beautifully. Well done.

Antonio:   Thank you.

Nadine:   You're welcome. So, we are here today to talk about CMOs and CMO Moves, and you, my friend, have made a lot of really cool moves at both at Visa and now at HP. And in fact, you know, I'd like to just start with how you see the role of the CMO. I know you've been very vocal about what you think the responsibilities are, and my hat's off to you because you've really hit on some very important points. So with that I'll turn it to you.

Antonio:   The role of the CMO has been, will always be, to build brands that stand the test of time. And we build the brands that stand the test of time because I believe, we believe, that building unique, memorable, and relevant, and importantly differentiated brands, are key to creating businesses that stand the test of time.  And the responsibility of the marketer is to ensure that those brands are anchored in purpose, that they play a really meaningful role in people's lives, that they’re built on strong emotional connections, that they behave with integrity, and importantly, that they're always reinventing themselves to deliver that purpose. That, to me, has not changed.  Sometimes the craft forgets about it, but that has not changed. What has changed is the ways in which we are actually building the brands that will stand the test of time, and all the tools that we have available to connect with our customers and consumers.

Nadine:   Absolutely, I couldn't agree with you more. And when you talk about all the different hats that you wear, and you mentioned one that's really near and dear to my heart, which is really a Chief People Officer. I'd love for you to go in a little bit deeper on how you define that and how you've been able to be that for HP.

Antonio:  So the role, contrary to what some of the analysts say, the role for people like myself, or for people like Keith Weed or Raja in MasterCard, or Kristin Lemkau in Chase, has has actually gotten wider.  We are responsible for insights, analytics, we're responsible for media, we’re responsible for the corporate communication agenda-- in other words, what is our corporate brand and its relationship to the consumer and the customer brand?-- we are responsible for product marketing, we are responsible for brand, we are responsible for the actual implementation of all field activities around the world. So the role has gotten wider, the expectations from the CEO as it becomes to the CMO has also grown. We are supposed to be the voice of the customer. That has always been the case, but now the customer has more voices, more channels. Making sure that all that data is translated into meaningful insights is important. The CEO and the rest of the senior management team are expecting us to help them navigate through digital environments to build the partnerships with companies like Google, and Facebook, and Twitter, and Amazon, and so on, and so forth.  Our competitors are everywhere as well, big and small, and everybody has their megaphone called social media. So the level of responsibility has grown, and the level of expectations has also grown. So, it's really impossible for any CMO to actually be able to lead from the front in all those particular areas. So, in a way, my role has become more of a CEO of the marketing function. That's why I always speak about being a businessperson first and a marketing artisan second, because I am leading strategy, and when it comes to people, the number one responsibility is ensuring that I am able to build an ecosystem, internally and externally, that delivers against those needs, against the insights needs, the media needs, against the communications needs, against the product marketing needs, and so on, and so forth. So, I spend a lot of time in hiring, retaining, and developing talent quotients. I spent a lot of time thinking through what are the capabilities that we want to hone, relative to the capabilities that we're going to partner, relative to the the capabilities that we want to buy in order to deliver against this wider scope.

Nadine:   So, you just touched upon so many things that I can't wait to go deeper with you on.  Let's start with what you were talking about regarding the CEO expectations. I remember when we were putting together your case study, you said, “Nadine, it's very important that you balance the short and the long-term, and to do that you really have to earn the trust and the credibility with not only the CEO, but your entire C-Suite.” So you came into HP and were responsible for building this brand that could stand the test of time. How did you start this process, and develop those relationships, and earn that trust so that you could build that brand?

Antonio:  Again, business person first, which meant, in very practical terms, that during the first months of my tenure, I spent a lot of time with the business leaders, as opposed to spending time with a marketing function. And, in fact, if I had to make a choice: be doing a business meeting, or an internally driven marketing meeting, I will gravitate to the business meeting. So, I spend a lot of time traveling with the CEO. I spend a lot of time with all the business leaders around HP to understand from them what were the fundamental business issues first, and also the areas in which marketing could add more value. After, we were able to craft a marketing agenda, as to the areas that we need to focus on short-term and long-term, then I decided to go into the function and to build a function that was going to actually have the capabilities to deliver against that business agenda.  And this is a principle that I continued. I mean, now we're almost three years into our journey, Nadine, and let me give you a very specific example. We just had our annual marketing review with the CEO and the senior management team. It’s one time a year where we basically review everything that we've done, results, and so on, and so forth. In a two hour meeting, we did not show one piece of communication. It was all about the numbers. These were the revenue targets, this was the marketing contribution, this was the return on investment. This was the very specific account-based marketing initiatives that we were able to do. And it was a business conversation. And by the way, a highly engaged business conversation where we had active participation of the CEO, the CFO, as well as some of the business unit and regional leaders. And at the end of that presentation, two things happened. One, the CFO said we should be spending more money marketing, and number two, I really understand how this equation works.  In fact, they were so pleased with that, that we actually took it to the board of directors. And once again, with the board of directors, it was a numbers-first type of presentation. And what's interesting is that when you moving away from the consumer goods world into the tech world, that's critically important, you have to show the value of the marketing function to drive the top line growth because it's not inherently obvious in the business as it is in the consumer goods world, where I grew up.

Nadine:   It's interesting that you mentioned Raja. It's funny, I've done now five or six recordings and in every one, Raja's name comes up. And it's because Raja is very much aligned with you, that financial acumen and credibility is of key importance today. And we spent a lot of time, all of us together, when we did the ANA CMO Talent Challenge Playbook, trying to define that upfront around aligning those leadership teams, you know, in Raja's case, he builds a relationship, like you said, with his CFO, and created a marketing-finance jointly-managed team, which is a pretty cool way to do that. In your case, you know, you have so much information at your hands, including things that are even harder to measure, like emotion, and you were sharing how you've really done a lot using data, new analytics, to take all of the emotional components and translate it to that growth, translate it to how it's delivering the financial results. That's a very difficult thing for most people do. Can you share how you do it?

Antonio:  First, I'm a big, big fan of Raja as well. I competed against Raja and it was a fun time, Visa vs. Mastercard, because the moment that he got in, we both got better in our job, so I have nothing but the utmost respect for him. As it pertains to emotion, when I speak about emotion, I don't mean emotion for emotional sake, I mean rationally anchored emotion, and rationally anchored emotion comes out of a very deep understanding of your customer, a very deep understanding of your product, and then a very deep understanding of where the two converge, or merge, into a very nice and differentiated proposition.  So in our particular case, that was the first step, number one, as we moved in a to HP, we made the millennial target the center or our communication. The reason for that is that sixty percent of our revenue is driven by what we call IT decision makers... they’re all millennials. So getting a thorough understanding of what they are about, the things that motivate them, and importantly, the the role that technology plays in their life. So that's sort of a big scale insight. Then, as we are developing some of this work, we are testing, and we're testing it using brainjuicer, and brainjuicer will tell you, very specifically, when you're hitting the right notes emotionally and rationally. And we use that data to actually edit the films to ensure that they are delivering against what we're trying to deliver emotion as well as reason, and then, after that,  we do a very thorough return on investment analysis where we're able to clearly point out the correlation between this, was a high scoring emotional connection, and this is the type of return that we were able to achieve. That's how you do it, and that's how the business functions actually become much more comfortable by saying, actually, yeah, we should allow Antonio, Vick, Alex, and Karen, who are my mind leads, to actually do more heart-related stuff. Let's say that's your short-term measure. Then at the end of the road, you're also measuring, OK, we did all this, how are the overall brand KPIs reacting to it, our overall brand perception in terms of awareness, consideration, and preference, and even net promoter score, and it's math. You can do straight-line correlations on all of it, and be able to prove the value of your work, which is more critical than ever in today's marketing environment.

Nadine:  Well, obviously, you've figured out the secret formula if your CFO says, “Hey, let's put more money into marketing!” I think that's every marketer's dream, right?

Antonio:  That's what we're aiming for. And by the way, the chairman of the board said the same thing as well.

Nadine:   I remember when you shared with me a framework that you had put together, it's very cool. And for anybody who's listening and wants to see it, they can find it in the Playbook. And it was, and I want to say it correctly, it's E = I2DeA. So tell me about that.

Antonio:  Well, that was my way of rallying the organization towards a new mission. The E of the idea, that formula, is emotional connection, and the way you drive that is with the first I, which is insight. The second I is innovation. The D is digital connection, because we're, today we're spending seventy three percent of our global media dollars in digital. The E is for experiences, because the purchase, all the products that we sell, which are preplanned, that required information of different moments during the journey, require a thorough understanding of the totality of that experience and our ability to create delightful connections throughout that particular journey.  And then the A, which is a very important, A of accountability, which is everything that we're going to do, we're going to measure, and we're going to prove. And that was the way in which we have, in which we rallied the organization resources towards it and frankly, over the last two and a half years, we've built the model, what is the right moment, for instance, what is the right model for innovation? How do we approach digital environment now, with a lot more focus on mobile, how do we understand the journey and create comprehensive experiences, you know, in an omni-channel world? And then, the last is what are we measuring, and how do we demonstrate value?

Nadine:  Well, it's amazing. You know, when we were first putting together your case study, and I'll use singular form right now, we couldn't figure out what we were going to talk about, because there was so many things that you've been doing here.  I couldn't pick, so we did two case studies. And the second one was all about what you had said in the first one, which is that brand experience actually starts on the inside, and this is all the work you've been doing to help your teams really feel like they are operating in a very innovative, productive, inclusive environment. And one of your big initiatives was around D&I, but that's not the only thing. So I'd love for you to talk a little bit more about how you really tapped into the employees around the world to understand how they wanted to be thinking about HP, and the mark that they've made on the world.

Antonio:  So again, and this is something that we've become a beacon and an apostle of, which is making your employees brand ambassadors. So, we fundamentally believe that is critical. We have a unique opportunity, which was that we were launching a new company, and the first people that needed to understand who we were, what our brand was all about, and what our purpose was, was our employees. 55,000 we have now, all over the world. So, everything that we did when we launched the new mission, and vision, and in the right platform, was internally driven first. So employees participated in surveys that were critical in the development of those statements and participated in the validation. Employees saw the work first. As we've evolved in it, we've created and opened to all employees our brand central, where anybody around the world, whether you're in sales, or in finance, or in HR, you can come and see what our brand is all about, what is on-brand, everything from our positioning statement all the way down to how to use the logos. And then we built narratives as to ‘what does the HP Corporation stand for’, and ‘what does the HP brand stand for’. And we've shared that broadly with all of our employees around the world, and allow them to participate in conversations. Just the latest example, both Christmas films that we released were shared with our employees first. All the work that we did in D&I and the reinvent mindset campaign was shared with our employees first. In many cases, it was our business network that actually helped inspired some of the insights of that reinvent-mindset campaign. So we believe that getting internal alignment, but more than alignment, and truly making each and every one of our employees brand ambassadors is a fundamental responsibility of the brand and one that we frankly share with the HR function.

Nadine:   Absolutely. You know, the name of the show is CMO Moves and it's that way for a reason. You know, at the end of the day, you know, we all have choices and we can make some moves, and sometimes it breaks some rules, and sometimes it ruffles some feathers, and sometimes it doesn't.  Sometimes it's just the right thing to do. And I think it was almost a year and maybe a quarter ago that you were so committed and invested professionally and personally in D&I that you asked your ecosystem of partners to really join with you in this mission to make sure that everyone has an opportunity to be included. I think that's just amazing and I really appreciated the one year celebration that you had a couple of months ago, because you've made some serious progress as a result of making that move. Can you talk a little bit more about that?

Antonio:  I'm glad that you're asking me, because I applaud Bob Liodice's stand just yesterday on diversity and inclusion and the work that the ANA is doing, actually led by Marc Pritchard and his executive team of Linda Boff, Kristin Lemkau, and people that I admire very much, like Diego Scotti and Raja. It's time that we move into a different level and I believe that it all starts with accountability and transparency. We cannot speak from both sides of our mouth, meaning the marketing discipline has become more scientific than ever before. We are scientists, or let's say, renaissance men. I'm reading Leonardo Da Vinci's biography by Isaacson, and the fact that we have an artistic side, but we are anchored in science, and science begins with data, and we can not continue to talk about diversity and inclusion without data. So it's time, really, it's time, that the industry, clients, agencies, production houses, released the scorecards. It's simple. I mean, it doesn't have to be very sophisticated. It is, you know, percent of women, percent of women in managerial roles, percent of women in senior roles, and the same for people of color. It's as simple as that. And when I say that, I'm very passionate about it, and that is precisely what we did.  We started with ourselves. I mean, we can't, you're gonna begin to preach without changing yourself first. And we were very well represented on our total population on women and people of color. We were well represented at the managerial level, we were not well represented at the most senior levels. And we had to change that, and we took two months, and we changed that. And then we invited our agencies. Again, it all starts with a scorecard. It starts with a scorecard. It starts with senior management commitment. So the conversations were with the CEOs, not with anybody else, and you have to monitor performance. So, every quarter, we will monitor performance. I've met with each one of them individually. Diego Scotti actually did it better than I did. Diego met with all of them together, but followed the same sort of approach, which is what gets measured gets done, and what gets published actually becomes your bonds. So it's not just measure, you have to publish it, and I think that it's time to do this as an industry. So I'm delighted that Bob and I are going to undertake this. I will be there helping with our knowledge and our case, because it made a difference. Today, sixty percent of the people that worked in our account are women. When we started, it was forty. At the leadership level, we started with zeroes. With big agencies like BBDO and big agencies like Fred and Farid, and we ended up on fifty percent of the senior leadership in the agencies, including creative, are now female. So this thing works. We just need to do a better job now, and that's our commitment for 2018 with people of color. We did not move the needle as much as I thought we were going to do. We did make progress. We need to go farther, but it's time.  It's time for bold action. It's time to show the numbers.

Nadine:    I could not agree with you more. Yesterday, I interviewed Nick Primola, who is the Senior Vice President for the ANA, about twenty minutes before they left for their big Christmas party, and we had a really good chat about this. And I think you, and all the wonderful people that you named, many who are going to be guests on the show, so I'm very excited about that, are. I'm so pleased to see everybody taking a stand, and as you know, Antonio, I'm also Chief Transformation Officer of the female quotient, and we couldn't be more proud to be part of that mission with the ANA as well. So we're all in this together. Gender equality number five, right?  And with that, you know, it's not just about the numbers, I think, because, you know, my passion is really culture and giving everyone an opportunity to not just have a seat at the table, but have a voice, and that's a very different leadership skill to build and flex, as you are providing an environment for people to really have that voice, and ensuring that the rest of the team is listening, you know. How do you think about that? And you, obviously, are a naturally gifted leader, but you learned along the way how to do that. Did you have an inspiration? Are there tips or tricks that you know, or training that you went to? How did you develop the skills to be able to shepherd that environment?

Antonio:  Nadine, I was truly blessed, meaning I began and grew my career in international business. So, when you are growing an international business, the teams, by definition, are diverse. So the whole notion of people from different races, geographies with different accents, was natural for me. I did not grow up in homogeneous environments. The one area of opportunity, looking back at those years, is we didn't have enough women at the time, and that is a fact, and that I made a commitment to change over time, but when you grow up in this environment, it becomes second nature. You no longer hear the, the accents, anymore. The dynamic in some of the more domestic organizations, or on some of the more US-centric divisions in the companies that I worked with, was very different in that sense. So I am very grateful that I grew up and developed my career where I did, because it becomes easier than when you do not grow up in diverse environment, to the point that I sometimes question whether being as different as I was here-- I have a very thick accent-- whether I would have been able to progress my career as far as I did if I had not begun in the international division. Hopefully, that will no longer be the case, because I think things are more open, but I owe this view and this philosophy to the experiences that I had.

Nadine:  Absolutely, and I know our good friend Jonathan Mildenhall would totally agree. That was such a great conversation with you two, and I think your point is really well-taken. I mean, I believe that everyone needs to experience something new and we were talking about that through the course of this week, different tips about CMOs, or CMOs-in-training, to really go out and try different industries, or try different roles, or do a stint in finance. But equally important is go to a different country, you know, as you're saying, and really bringing together the collective cultures of the world to have that representation for your brand, because it only makes you better. And so, coming back to growth, you know, a lot of people now finally recognize that having diverse teams does drive growth. Are you seeing the result of all these initiatives that you're doing around diversity and inclusion that's driving growth?

Antonio:   I would like to build a more direct correlation case. In due time we will, but I will tell you that everything that we've done, all the transformations, and all that, today, this company is growing. The top-line growth on both categories that were challenged two and a half years ago, which were the printing category and the personal system category, we've grown share on both categories at a significant level, our brand regard scores are at all-time highs. All our net promoter scores, both from the consumer, but more importantly for clients, are at an all-time high. All the work, the marketing work, that we delivered this year with very diverse teams, and with paying attention to who was the director of what film, and who are the creative people that films, have actually scored higher than any of the work that we've delivered before.  I cannot sit down with you and say, as a business person, that I can prove a correlation of one or close to one, but I'm pretty sure that by next year, we will be in a position to begin to establish that more direct numerical correlation, but directionally, unequivocally, the business case for diversity is being proven with our work in 2017.

Nadine:  Well, hats off again to you. You know, we have only a few minutes left, and I want to get personal for a moment. You put out a film short film called “Dads and Daughters,” and I saw it, and you made me cry, because I thought of my dad and what he would say if he were one of those fathers listening to their daughters, and what he would say if I was telling them that story or one of those stories. And you have five daughters.  Where did your inspiration come to put together that campaign?

Antonio:  So the campaign did not come from my daughters, the inspiration came from the people at HP, actually, the need to have more women in our workforce. We're adequately represented in the marketing function, adequately represented in the HR function, and even legal, but other areas, like engineering, where we need more women, and that was the inspiration. There is always a business motivation from the insight. As to how to deliver that story, came from a lot of the conversations that we had with our big networks, our women networks. And actually, one that was very interesting with one of my daughters, which she just shared with me some of the commentary that was happening in the internet, as to the tips that women get for the interview process, and I was reflecting with our team here about it in terms of how different it is as a man. I would have never been given tips, you know, as to how to look, and this and that, and wear red lipstick, or not red lipstick, or whatever it may be. And the team felt that that was a very interesting insight. And then the people from Fred & Farid, that is probably one of the most diverse agencies that we have today, and a great director came up with the father and daughter, a script that you've seen. So, that was the motivation, and I think it worked. It created all sorts of interesting conversations, but more importantly, more resumes from female candidates to our HR department, which is what we wanted.

Nadine:   Well, it is such a-- it's so powerful, because it was truly connected at the human level to so many people in different roles, and everyone could relate to that piece of work. So, thank you for that.  Who inspired you on your journey?

Antonio:   Oh, I’ve been blessed, Nadine, in terms of different people having inspired me at different stages of my career. I've been very fortunate to have had great mentors around the world at different moments. Some that have stayed with me for many years, some that came in at a moment in time where I needed to learn something very specific. So, I believe that some of those mentors have been incredibly influential in my life from my very first boss at Procter & Gamble, to the privilege of working with people like Steve Reinemund, and Indra Nooyi, and Mike White when I was in PepsiCo, to the incredible opportunity to meet Lord Philip Gould, who was Tony Blair's right-hand man, and he became a beacon in my transformation as a human being and as a leader, to the people that work for me today, that inspire me, and teach me new skills as a leader.  So yeah, I could not mention one, because I've had so many, many inspirations across the journey. I will tell you that the person that I admire the most is my brother. My brother Ramon is five years younger than I am. He was the Salutatorian in his high school class in Puerto Rico. But he's schizophrenic and he's been in a home now for many, many years. And he's obsessed with voices and thoughts, yes, yet he gets up in the morning, fights the battle every day and goes on with his life as much as he can. And when I see him, what he goes through every day, and I see the amazing life that I've been given, the opportunity to live, he is the number one source of motivation.

Nadine:   Wow that is so touching. I'm sorry to hear that he is having these types of challenges in his life.

Antonio:   We all have challenges. Everybody, particularly when we're talking about this graph, we don't share a lot of our personal life, but every person, every family, goes through this. I'm not special. We all have them on different sizes of different fortunes and sharing some of the stories. I think it's good at good for business and it's good for the soul.

Nadine:    It sure is. So my very last question for you, if you were not the CMO of HP, you could do anything in the world, what would you do?

Antonio:    That would be-- I would be a teacher, for sure. It would be a teacher, and I would love to have the opportunity to write as well. But if you're talking about the fantasy world? I would have loved to be Ricky Martin.  I'd be a Latin heartthrob!

Nadine:   Well, you are the Ricky Martin of marketing. So...

Antonio:   Although, Kristin Lemkau has some sort of a CMO dance-off idea. I'm actually intimidated, because if you put Jonathan Mildenhall, Kristin, and Mr. Steven Wolfe Pereira in the same dance floor, I just concede.  

Nadine:   Oh, I want to go to that party. That's going to be fun. Oh my gosh. Antonio, thank you so, so much for being with me today, and I really appreciate you, and everything you do. You're an inspiration to so many people, so thank you for continuing to lead the way.

Antonio:   Thank you for the opportunity. And, you know, I think we're leading a renaissance in the marketing function. Everything that people read says the short tenure of the CMO. The type of people that are leading marketing organizations around the world are truly gifted marketers, human beings. They're driving brands with purpose. There are people with purpose, whether you're talking Marc Pritchard at P&G, Keith Weed at Unilever, people like Kristin at Chase, people like Leslie at Twitter, and Linda at GE. Some of the younger CMOs, like Steven, Raja at MasterCard. I mean, this is an amazing group of human beings. I mean, thank you for telling me that I inspire. They inspire me every day, because these are people that are incredibly capable at what they do. They're great leaders, but more importantly, they're great human beings, and I think that that is the story as this new generation comes in, this is going to be the most important moment for the function. And I am convinced that three years down the road, we're not going to have the articles about marketing losing clout anymore, because this group of CMOs is probably one of the best that I've ever seen, and I've been around for a long time.

Nadine:   I agree. One hundred percent. So again, thank you so much.

Antonio:   You're very welcome.