organizational issues
DESCRIPTION
organizationTRANSCRIPT
14-1
DesigningMarket-DrivenOrganizations
McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
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Designing Market-Driven Organizations
Considerations in organizational design
Organizational design options
Selecting an organizational design
Global dimensions of organizations
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CONSIDERATIONSIN ORGANIZATIONDESIGN
Extent of need toalter verticalstructures
Extent ofpartnering withother organizations
Extent of process-type organizationaldesign
Considerations in Marketing Organization
Matching structureto strategic goals
Impact of Internet onorganizational processes
Need to integratevalue-creating activitiesaround customers
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Alternative Organizational Structures
TraditionalHierarchy
FunctionalStructure
ProcessOverlay
FunctionalOverlay
ProcessStructure
HorizontalStructure
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The Challenge of Integration
Integration problems Marketing’s links to other
functional units Additional approaches to
effective integration– relocation/design of facilities– personnel movement– reward systems– formal procedures– social orientation– project budgeting
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Illustrative Example: GE’s Philosophy
“One clear message in our approachis the value of the borderless culturewhich breaks down the horizontalbarriers between functions and the vertical barriers between organizationallevels. This means that employees areencouraged to collaborate with othersand given considerable freedom toturn their creativity into productivity.”
Source: Robert Nardelli, GE, 1993
14-7Impact of the Internet on Organizations
New managerial roles and practices are mandated by the Web– fast access to information from any
location and remotely– accelerated trend towards flatter
organizations– virtual team-working across
geographical and organizational boundaries
– new approaches to supplier relationship management (SRM) and customer relationship management (CRM)
– managing and controlling outsourcing of more business processes and activities to specialist suppliers
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Organizational Design Options
Traditional designs Marketing’s corporate role New forms of marketing
organizations
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TRADITIONALDESIGNS
Functional
Matrix Product-Focused
Market-Focused
Traditional Marketing Organization Designs
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Organizational Transformation
Hybrid organization forms
Designs linked to value strategy and core capabilities
Vital role of data networks
Shared information and decision making
Source: George S. Day, “Aligning the Organization to the Market,” in Reflections on the Future of Marketing, Donald R. Lehmann and Katherine E. Jocz, eds. Cambridge, MA: Marketing Science Institute, 1997, 67-93.
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New Forms of Marketing Organization
New marketing roles– Chief relationship officer, chief
knowledge office, chief customer officer
Transforming vertical organizations through managing processes
New organizational forms– networked organizations– the marketing coalition company– venture marketing organizations
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The Marketing Coalition Company
Source: Ravi S Achrol, “Evolution of the Marketing Organization: New Forms for TurbulentEnvironments”, Journal of Marketing, October 1991, 88.
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TRANSACTIONALBUREAUCRATIC
ORGANIC RELATIONAL
CentralizedFormalizedNonspecialized
Internal(hierarchical)Organizationof Activity
External(market)Organizationof Activity
DecentralizedNonformalizedSpecialized
Organizing Concepts
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Organizing the Sales Force
Organizing multiple sales channels– personal selling– Internet-based channels– telesales– direct marketing
Coordinating major account responsibilities– Key account management– Global account management
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Global Dimensions of Organizations
Issues in organizing global marketing strategies– Variations in business functions– Organizational considerations
Coordination and communication– Strategic alliances– Executive qualifications
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Marketing Organization Plan Combining Product,
Geographic, and Functional Features
Source: Philip B Cateora and John L Graham, International Marketing, 12th ed.(Burr Ridge, IL: McGraw-Hill/Irwin, 2005), 336.