Marketing Strategy

Marketing Strategy Chapter 8 Marketing Implementation Organizations do not implement strategies, PEOPLE DO!

Marketing implementation is the process of executing the marketing strategy by creating specific actions that will ensure that the marketing objectives are achieved. Marketing strategies almost always turn out differently than anticipated because of the difference between intended marketing strategy and realized marketing strategy. Intended marketing strategy is what the organization wants to happen; it is the organization's planned strategic choice. Realized marketing strategy is the strategy that actually takes place. The difference between the intended and realized strategy is more often than not the result of the way the intended marketing strategy is implemented. Marketing Implementation

Planning and Implementation Are Interdependent Processes Planning and Implementation Are Constantly Evolving Planning and Implementation Are Separated Issues in Marketing Implementation

While it is true that the content of the marketing plan determines how it will be implemented, it is also true that how a marketing strategy is to be implemented determines the content of the marketing plan. Certain marketing strategies will dictate some parts of their implementation. Planning and Implementation Are Interdependent Processes

The reality of marketing is that critically important environmental factors are constantly shifting. As customers change their wants and needs, as competitors devise new marketing strategies, and as the organization's own internal environment changes, the firm must constantly adapt. Because of the interrelationship between marketing strategy and marketing implementation, both must constantly change. Managers often assume that there is one correct way to implement a given strategy. Just as strategy often results from trial and error, so does marketing implementation. The fact that marketing is customer-driven (marketing concept) requires that the organization be flexible enough to alter its implementation to counter changes in its customers' preferences or the competitive environment. Planning and Implementation Are Constantly Evolving

The ineffective implementation of marketing strategy is often a self-generated problem stemming from the planning process itself. While strategic planning is carried out by top managers, the responsibility for implementing marketing plans falls on lower-level managers and frontline employees. Because top managers are separated from the "front line" of the organization, they often do not understand the unique problems associated with implementing marketing strategies. Conversely, those employees who do understand the problems of marketing implementation usually have no voice in developing the marketing plan. Another trap that top managers often fall into is believing that lower-level managers and frontline employees will be excited about the marketing strategy and motivated to implement it. Planning and Implementation Are Separated

Shared goals and values among all employees within the organization are the "glue" that binds the entire organization together as a single, functioning unit. Marketing structure refers to how an organization's marketing activities are organized. Organizational systems and processes are collections of work activities that take in a variety of inputs to create information and communication outputs that ensure the consistent day-to-day operation of the organization. An organization's resources can include a wide variety of assets that can be brought together during marketing implementation. People refers to the human side of marketing implementation, the "5th P" of marketing. Leadership, the art of managing people, includes how managers communicate with employees, as well as how they motivate their people to implement a marketing strategy. The Components of Successful Marketing Implementation

Without a common direction to hold the organization together, different areas of the company may work toward different outcomes, thus limiting the success of the entire organization. Institutionalizing shared goals and values within a firm's culture is a long-term process. The primary means of creating shared goals and values is through employee training and socialization programs. Creating shared goals and values is the most important part of marketing implementation because it stimulates organizational commitment where employees become more motivated to implement the marketing strategy and meet customer needs. Organization’s Shared Goals and Values

The organization's marketing structure establishes formal lines of authority, as well as the division of labor within the marketing function. Managers must decide how to divide and integrate marketing responsibilities and how much to centralize decision making. In a centralized marketing structure, all marketing activities and decisions are coordinated and managed from the top of the marketing hierarchy. Centralized structures are very cost-efficient and effective in ensuring standardization within the marketing program. In a decentralized marketing structure, marketing activities and decisions are coordinated and managed from the front line of the organization. Decentralized marketing structures have the advantage of placing marketing decisions close to the front line where customer needs are the priority. Organization’s Marketing Structure

By providing a continuous flow of information, the marketing information system (MIS) can assist in the analysis of the internal and external environments before marketing strategies are developed. The MIS is also used during implementation to assist in the evaluation and control of all marketing activities. Organizational Systems and Processes

Organization assets may be tangible or intangible Tangible resources include financial resources, manufacturing capacity, facilities, and equipment. Intangible resources include marketing expertise, customer loyalty, and external relationships/strategic alliances. A critical and honest evaluation of available resources during the environmental and SWOT analyses can help ensure that the marketing strategy and marketing implementation are within the realm of possibility. Once the marketing plan is completed, the manager must seek the approval of needed resources from top management. Organization’s Resources

The implementation of any marketing strategy depends on the quality, diversity, and skills of the firm's work force. People are considered by many as the “5th P” of marketing. The people component also includes employee selection and training, reward policies, employee motivation, commitment, and morale. Organization’s People

Leaders are responsible for establishing the corporate culture necessary for implementation success. Marketing implementation is more successful when leaders create an organizational culture characterized by open communication between employees and managers. One of the most important tasks leaders perform is to motivate their employees to give their best effort. A final trait that all leaders possess is a leadership style, or way of approaching a given task. Organization’s Leadership

With the command approach, marketing strategies are evaluated and selected at the top of the organization and forced downward to lower levels where frontline managers and employees are expected to implement them. The change approach is similar to the command approach except that it focuses explicitly on implementation. In the consensus approach, top managers and lower-level managers work together to evaluate and develop marketing strategies. The cultural approach carries the participative style of the consensus approach to the lower levels of the organization. Approaches to Marketing Implementation

The command approach has two advantages: It makes decision making easier. It reduces uncertainty as to what is to be done. The command approach has several disadvantages: It does not consider the feasibility of implementing the marketing strategy. It divides the organization into strategists and implementers, with no consideration for how strategy and implementation affect each other. The command approach often creates employee motivation problems. The Command Approach

The basic premise here is to modify the organization in ways that will ensure the successful implementation of the chosen marketing strategy. A manager taking this approach is more of an architect and politician, skillfully crafting the organization to fit the requirements of the chosen marketing strategy. The change approach still suffers from the issue of separation of planning and implementation. This approach often take a great deal of time to design and implement. The Change Approach

The underlying premise is that managers from different areas and levels of the organization come together as a team to "brainstorm" and develop the marketing strategy. Through this collective decision-making process, a marketing strategy is agreed upon and a consensus reached as to the overall direction of the organization. This approach moves some of the decision-making authority closer to the front lines. The consensus approach often retains the barrier between strategists and implementers. Managers at all levels within the organization must communicate openly about strategy on a daily basis, not just during formal strategy development sessions. This works best in complex, uncertain, and highly unstable environments. The Consensus Approach

The basic premise is that marketing strategy is a part of the overall organizational vision. The goal of top managers using this approach is to shape the organization's culture in such a way that all employees—top managers to janitors participate in making decisions that help the organization reach its objectives. As a result, the cultural approach breaks down the barrier between strategists and implementers so that all employees work toward a single purpose. Employees are allowed to design their own work procedures, as long as they are consistent with the organizational mission, goals, and objectives. This extreme form of decentralization is often called empowerment (i.e.,allowing them to make decisions on how to perform their jobs). The Cultural Approach

Employee Selection and Training Employee Evaluation and Compensation Policies Employee Motivation, Satisfaction, and Commitment People: the Human Side of Marketing Implementation

One of the most critical aspects of marketing implementation is matching employees' skills and abilities to the marketing tasks to be performed through employee recruitment, selection, and training. One of the best ways to ensure a match of skills to activities is to select individuals with raw abilities and train them to perform certain tasks. Through training and socialization programs, employees learn to understand what is expected of them in implementing a marketing strategy. An increasingly important aspect of selection and training practices is the management of employee diversity, whether it be ethnic or generational. Employee Selection and Training

Develop an evaluation and compensation program that ties employee rewards to performance levels on required marketing activities. Employee evaluation and compensation should be based on either outcome-based or behavior-based control systems. Outcome-based control evaluates and compensates employees based on measurable, quantitative standards, such as sales volume or gross margin levels. Behavior-based control evaluates and compensates employees based on subjective, qualitative standards such as effort, motivation, teamwork, and friendliness toward/problem solving with customers. Employee Evaluation and Compensation Policies

This is the extent to which employees are motivated to implement a strategy, their overall feelings of job satisfaction, and the commitment they feel toward the organization and its goals. While factors such as employee motivation, satisfaction, and commitment are critical to successful implementation, they are highly dependent on other components, especially training, the evaluation/compensation system, and leadership, as well as marketing structure and processes. The key is to recognize the importance of these factors to successful marketing implementation, and to manage them accordingly. Employee Motivation, Satisfaction, and Commitment

Internal marketing refers to the managerial actions necessary to make all members of the organization understand and accept their respective roles in implementing marketing strategy. Under the internal marketing approach, every employee has two sets of customers: external and internal. Unlike traditional approaches where the responsibility for implementation rests with lower levels of the organization, the internal marketing approach places this responsibility on all employees, regardless of organizational level. Successful marketing implementation comes from an accumulation of individual actions where all employees are responsible for implementing the marketing strategy. The Expanding Role of Internal Marketing

The Four Ps of Internal Marketing • Internal Products • The marketing strategy • Employee tasks, behaviors, values, & attitudes • Internal Prices • Employees’ job-related changes • Working harder; expanding abilities • Internal Distribution • How the marketing strategy is communicated (e.g., planning sessions, workshops, formal reports, employee training) • Internal Promotion • Informing and persuading employees about the merits of the marketing strategy (e.g., speeches, newsletters, etc.)

The recruitment, selection, and training of employees must be considered an important component of marketing implementation. Top managers must be completely committed to the marketing strategy and overall marketing plan. Employee compensation programs must be linked to the implementation of the marketing strategy. The organization should be characterized by open communication among all employees, regardless of organizational level. Organizational structures, policies, and processes should match the marketing strategy to ensure that the strategy is capable of being implemented. Successful Implementing an Internal Marketing Approach Requires

Hypothetical Implementation Timeline

Marketing Strategy