What exactly is a “growth department” in an organization? Is it just a buzzword or does it drive real business impact?
Daniels College of Business professor Yashar Atefi recently completed research that answers those questions, and much more, on this previously mysterious department. Atefi, an associate professor of marketing and the Evelyn and Jay G. Piccinati Endowed Chair, has long been interested in the areas of business growth, sales management and marketing strategy.
His latest research explores the recent influx of growth departments and what makes a good leader for these newly named teams. See the full paper published by the American Marketing Association and check out his Q&A with the Daniels Newsroom below.
Q. What sparked this research interest for you?
As a scholar working at the intersection of sales and marketing, I became increasingly aware of the rapid rise of growth titled positions across industries. Firms were introducing growth managers, heads of growth, vice presidents of growth and even chief growth officers at an accelerating rate. At the same time, ongoing discussions around the evolving responsibilities of the CMO, the fragmentation of marketing tasks across multiple departments, and the push toward more agile organizational structures highlighted a meaningful gap in our understanding.
Marketing and sales leaders were being asked to demonstrate their contributions to growth, yet many struggled to clearly show how their activities translated into organizational growth outcomes. This disconnect, combined with the rising number of growth department roles, made it clear that a new form of organizational structure was emerging that scholars had not yet examined.
I wanted to understand what this growth department actually is, how it differs from traditional functions and whether it has a measurable impact on firm performance. Those questions ultimately motivated the research program.
Q. How would you define a growth department? And what differentiates it from traditional marketing or sales teams?
The research shows that the growth department is a cross-functional organizational unit designed to unify and orchestrate all growth-related initiatives across the firm. It is not a renamed marketing or sales team. It is a horizontal department that sits across product, marketing, sales, customer success, operations and even inorganic growth activities such as mergers and acquisitions.
Interviews with chief growth officers reveal that the growth department has two central responsibilities:
- The department leads holistic growth strategizing. This includes long range planning, evangelizing a shared growth vision, unifying growth initiatives across functional silos, optimizing marketing channels, aligning sales and customer processes with growth priorities, and shaping product development based on market demand signals.
- The department provides growth process leadership. This involves taking end-to-end responsibility for growth outcomes, orchestrating resources behind high impact initiatives, aligning metrics across functions and driving efficiency improvements throughout the organization.
Unlike marketing and sales departments that often focus on their own domains and timelines, the growth department possesses a mandate that is both broader and more integrative. It works directly with the CEO, spans all functions, includes both organic and inorganic growth, and is explicitly accountable for connecting strategy to execution.
Q. What were your primary takeaways from the research?
Several insights emerged from the five studies.
- The growth department is empirically distinct from marketing and sales. Job ad analyses show that cross-functional strategizing is the strongest defining feature of growth roles, whereas marketing and sales roles emphasize their respective domain-specific responsibilities.
- CGO interviews illustrate that the growth department unifies strategy and execution across the enterprise. It integrates product development, marketing, sales, customer success and acquisition related growth efforts under one organizational umbrella.
- Growth departments improve firm outcomes. Startups that hire a growth leader advance through more funding rounds than comparable firms hiring marketing or sales leaders. In public firms, more powerful growth departments are associated with higher Tobin’s Q [the most common measure of firm value], stronger cash flow and better return on assets.
There were two findings that were particularly unexpected.
- Growth departments are more effective in firms that follow a cost leadership strategy. These organizations typically excel at exploitation and efficiency [streamlining and building on existing strengths], and a growth department helps them strengthen their exploration abilities [exploring new markets or develop new products] in a disciplined and coordinated manner.
- The impact of the growth department is weaker in innovation intensive firms. These firms already invest heavily in exploration and tolerate uncertain outcomes, which can conflict with the growth department’s strong emphasis on coordination, prioritization and resource discipline.
These moderating effects reveal that the growth department is not universally beneficial in the same way across all organizational contexts. Its value depends on the firm’s strategic orientation.
Q. How should companies use these findings as they design their corporate structure?
Companies should view the growth department as a governance mechanism that helps them integrate fragmented growth activities across the enterprise. For firms that struggle with siloed marketing, sales, product and innovation functions, the growth department provides a unifying structure that aligns all growth initiatives toward a shared long-term plan.
Firms pursuing a cost leadership strategy can especially benefit. These organizations often excel operationally but may lack coordinated exploration efforts. A growth department helps them balance exploration and exploitation, consistent with organizational ambidexterity theory.
Executives should also recognize that growth departments are most effective when given real influence. The research shows that powerful growth departments correlate with stronger financial outcomes, which means firms need to formally empower these units with authority over cross-functional decision making.
Finally, firms should pay attention to the background of their growth leaders. Prior sales leadership experience strengthens the impact of growth leaders, likely because sales experience equips them with cross functional collaboration skills that carry over into the growth role.
Q. Are you examining further research opportunities that stemmed from this?
Yes, this project opened several promising research avenues that we are actively pursuing.
We are examining how new governance structures can enhance organizational efficiency and accelerate growth, especially in firms navigating digital transformation or shifting market conditions.
We are investigating different pathways to growth in both startups and public firms, including how firms sequence organic and inorganic growth activities over time.
We are also studying broader questions about how growth responsibilities are distributed across modern organizations, how they evolve as firms mature, and how new cross-functional roles reshape collaboration patterns within companies.
This paper essentially created a new research stream on how organizations structure for growth, and there remains much to explore.