Coca-Cola grabbed headlines recently when it named executive Mary Minnick to a new post overseeing three key growth functions: marketing, innovation and strategic growth. In essence, Coke created a "chief growth officer" position in all but name. But if the experiences of companies like Colgate- Palmolive, H.J. Heinz, Interpublic Group and Hain Celestial in establishing that role play out again, Ms. Minnick will have limited ability to reverse the beverage giant’s falling market share.

To prevent the job from losing its fizz – and Coke from losing even more share – Coke’s new growth chief must be given the reins to three areas that most companies have been reluctant to cede: the way the company defines and funds new product development; the way it determines the level and mix of its marketing investments; and how it sets internal incentives to create a culture of creativity and risk-taking. Failure to hand over these reins will only result in a new but inconsequential box on the Coke organizational chart.

We base these conclusions on our following of the chief growth officer trend and our research into the issue underlying it: the importance and difficulty of organic growth. A Marakon survey last year found that organic growth is the key issue for 59% of senior executives running U.S., European and Asian companies. Our studies of corporate performance indicate that organic growth is the single most important driver of long-term value in the capital markets.

While organic growth is critical to capital markets success, it no longer comes easy in a highly competitive economy of fast-shifting consumer tastes – even in companies with powerful brands like Coke. For the job to have teeth, a chief growth officer must have the authority to shape the internal conditions that make companies with more robust organic growth distinct from the laggards. Three critical capabilities stand out:

  • The ability to penetrate the consciousness of customers in ways that traditional market research does not address. Though companies spend billions annually on marketing research, many have only a superficial understanding of customer behaviors, attitudes and economics. As a result, many companies fall prey to competitors that are better at discovering the true drivers of customer buying behavior. SABMiller PLC, the $8 billion brewer, for years was frustrated by its inability to gain share from U.S. market leader Anheuser- Busch. Costly studies on the attitudes of its core audience of young male adults produced advertising featuring such eye candy as mud-wrestling supermodels. The ads caught attention but didn’t drive customers to the store. After conducting much deeper research on what actually drove purchasing behavior, the company climbed on the low-carb diet craze. Sales of Miller Lite have rebounded from yearly declines to high single-digit increases.

  • The discipline to maintain growth investments through good and bad times. Pressure to cut marketing and R&D spending can be enormous. One recent study of U.S. chief financial officers found 80% would curb what they felt was "discretionary" spending (advertising, R&D, etc.) if quarterly numbers were in danger. Yet keeping the foot on the growth pedal is essential, our study last year found. Some 73% of the companies in the top quartile of revenue growth increased R&D spending while only 55% of the companies in the bottom quartile did so. One of the secrets to CEO Jim Kilts’ turnaround of Gillette was refusing to give quarterly guidance to analysts. Kilts feared that doing so would force him to make his growth initiatives (new products, international expansion and brand building) run in fits and starts.

  • Creating a company culture that supports growth. Our research demonstrates that companies with better growth stories consistently do a better job of tying incentives to the growth agenda, removing penalties for failed growth initiatives and attracting and retaining creative people. At Google (and, long before Google, at 3M), scientific and engineering staff are encouraged to pursue their own research ideas 20 percent of the time. Knowing they can spend time on the projects that truly excite them keeps staff motivated and regularly rewards the company in terms of new and improved products.

Shouldn’t CEOs play the role of chief growth officer as Kilts has done at Gillette? Ideally, yes, but given the demands today on CEOs (including Sarbanes-Oxley), it’s getting harder for them to devote the time and energy required. To make growth a real priority, someone must be made accountable and granted broad powers that cut across traditional functional silos such as marketing, strategy, R&D and human resources. Thus we applaud companies like Coke that have carved out chief growth officer jobs. However, they need to give much more thought and vest much more authority in these positions if they want their companies back on the growth track.