1. Strategic Marketing 1. Imperatives for Market-Driven Strategy
2. Markets and Competitive Space
3. Strategic Market Segmentation
4. Strategic Customer Relationship Management
5. Capabilities for Learning about Customers and Markets
6. Market Targeting and Strategic Positioning
7. Strategic Relationships
8. Innovation and New Product Strategy
9. Strategic Brand Management
10. Value Chain Strategy
11. Pricing Strategy
12. Promotion, Advertising and Sales Promotion Strategies
13. Sales Force, Internet, and Direct Marketing Strategies
14. Designing Market-Driven Organizations
15. Marketing Strategy Implementation And Control

2. Designing Market-Driven Organizations
Chapter 14
Designing
Market-Driven
Organizations
McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

3. Designing market-driven organizations
Trends in organization design
Organizing for market-driven strategy
Marketing departments
Structuring marketing resources
Organizing for global marketing and global customers

4. Designing market-driven organizations
Procter and Gamble
Global restructuring to improve innovation and competitiveness
Global business units for products and market development units to tackle local market issues
Change agents appointed to work across business units
Virtual innovation teams work through intranet
Organization design supports clear strategies so all business disciplines can work together

5. Trends in organization design (1)
The New Organization
Traditional structures
Centralized, vertical, “command and control”
Organizational design shifts
Innovation
The knowledge-based worker
Managing culture
Collaborative working
Informal networks
Organizational diversity and external relationships

6. Organization costs
Cadbury Schweppes - world’s largest confectionery business
Restructuring at cost of $900 million
Organizational structure has become too complex with too many overlaps
Organizational costs account for 20% of turnover - compared to 12% at competitors
Reorganization is central to regaining competitiveness

7. Trends in organization design (2)
Managing organizational processes
Organizational agility and flexibility
Zara
Toyota
Employee motivation
“MySpace Generation”

8. Alternative Organizational Structures
Traditional
Hierarchy
Process
Overlay
Functional
Structure
Process
Structure
Functional
Overlay
Horizontal
Structure

9. Process-based organizational structure
Processes that define value
e.g. knowledge management, CRM
Processes that create value
e.g. new product development,
innovation
Process
Leadership
Processes that deliver value
e.g. logistics, customer service,
value chain relationships
Coordination
mechanisms
to link
process and
resource
leadership
Specialist resource groups support process
Managers e.g. functional departments,
business units, external collaborators
Resource Group Leadership

10. The Toyota way Pillar I Challenge Kaizen - continuous improvement
Genchi Genbutsu - go and see for yourself
Pillar II
Respect
Teamwork
EM2 - Everything Matters Exponentially

11. The MySpace Generation
Lives online - social networking sites are a way of life
Children of the babyboomers
Ambitious, demanding and question everything
Work/life balance is very important
Expected to be the highest maintenance workforce in history and the most high-performing
“You raised them, now manage them”

12. Organizing for market-driven strategy (1)
Strategic marketing and organization structure
Aligning the organization with the market
Informal lateral integration
Integrating mechanisms
Full customer alignment

13. Customer-based front-end organization
Senior Management
Mediation
from the
center
Shared planning and metrics
Customer-based
Front-end Units
Back-end Units
Internal linkages
Product customers
Solutions customers

14. Organizing for market-driven strategy (2)
Marketing functions versus marketing processes
Marketing as cross-functional process
The challenge of integration
Marketing’s links to other functions
Finance/accounting
Operations
Sales
R&D
Customer service
Human resource management
Approaches to achieving effective integration

15. Marketing departments
Centralization versus decentralization
Integration or diffusion
Contingencies for organizing
Evaluating organizational designs

16. Organizing Concepts BUREAUCRATIC TRANSACTIONAL ORGANIC RELATIONAL
Centralized Formalized
Nonspecialized
BUREAUCRATIC
TRANSACTIONAL
Internal
(hierarchical)
Organization
of Activity
External
(market)
Organization
of Activity
ORGANIC
RELATIONAL
Decentralized
Nonformalized
Specialized

17. Structuring marketing resources (1)
Structuring issues
Functional organizational design
Product-focused design
Product/brand management
Category management
Venture teams
New product teams
Market-focused design
Matrix design

18. Traditional Marketing Organization Designs
Functional
TRADITIONAL
DESIGNS
Product-
Focused
Matrix
Market-
Focused

19. Product-Focused Structure

20. Marketing Organization Based on a Combination of Functions and Products

21. Structuring marketing resources (2)
New marketing roles
New marketing specializations
Venture marketing organizations
Partnering with other organizations
Networked organizations

22. New organizational structure for marketing
Vice President
of Marketing
Director of
Product
Management
Chief
Customer
Officer
Customer
Service
Customer
Database
Marketing
Research

23. The Marketing Coalition Company
Source: Ravi S Achrol, “Evolution of the Marketing Organization: New Forms for Turbulent
Environments”, Journal of Marketing, October 1991, 88.

24. Organizing for global marketing and global customers
Organizing for global marketing strategies
Business functions
Organizational issues
Coordination and communication
Organizing for global customers
The growth in global retailers
Global account management structures

25. Global account management at Microsoft
Single executive/team in charge of single customer and all global needs
Restricted to customers by revenue size but also willingness/ability to partner
Senior managers encouraged to develop relationships with senior managers at global accounts
Global business managers work across business units, functions and organizations