Getting the Board on Board: Marketing Department Power and Board Interlocks

Abstract

Although the power held by the marketing department can determine key organizational outcomes, including firm performance, this power seemingly has been decreasing. To address this apparent disconnect, the authors propose that the board of directors is a critical but overlooked antecedent of marketing department power (MDP). In particular, the authors demonstrate that directors’ exposure through board service at other firms (i.e., board interlocks) affects MDP in the firms on whose boards they also serve (i.e., focal firms). A sample of 6,008 firms, spanning 2007–2021, reveals that MDP in board-interlocked firms has a positive effect on MDP in focal firms. Despite evidence that board interlock effects have diminished or even disappeared, the findings suggest the board interlock effect remains a potent antecedent of MDP—and this effect did not decrease during the observation period. Adapting the 3R (reach–richness–receptivity) framework, the authors also find that the board interlock effect increases with greater reach and richness of a focal firm's board interlock network and its executives’ receptivity to information. The marketing department's decreasing power is concerning for the discipline; the robust results of this study suggest that firms need to get the board “on board” to stem this diminishing trend.