PADM 7040 Nonprofit Management

1. PADM 7040Nonprofit Management Andreasen & Kotler Chapter 10 - Part 2 Pages 273 – 284 Debra Herrmann

2. Managing Multinational Nonprofits • Nonprofit organizations that are located in more than one country (worldwide) are facing challenges and must decide on their marketing operations. • Andreason & Kotler list several options to take. • Export Department • Multinational (or Multi-Local) Organization • Global Organization (p. 273)

3. Managing Multinational Nonprofits (Continued) • Export Department • Headquartered in a single country such as the US. Marketing experts go from country to country. • Multinational (or Multi-Local) Organization • Operates in numerous countries, each country has its own local management with a great deal of self-governing; coordination is handled at headquarters. • Global Organization • The world is viewed as a single market, develops universal strategies that applies everywhere. Local managers may adjust programs slightly to meet local needs. • Multinational has been dominate in the early 21st century; however, as the nonprofit world becomes more global, so will organizations. (p. 273)

4. Multi-Site Organizations • Marketing through multiple sites in a single country is another challenge that nonprofit organizations are facing. • Managers must decide if the control should be centralized or allow self-governing. • There are two important dimensions a manager must ask. • “Should local units be independent • and to what degree” (p. 274)?

5. Multi-Site Organizations (Continued) • Local offices of a central organization has two major challenges. • “To what extent should marketing capability be built into the local operation? • What should be the relationship with {headquarters}” (p. 274)? • The “local office” structure raises the acceptance of the marketing strategies. • Local autonomy can be powerful which leads to more customer-centered campaigns and programs. • “Headquarters must be sensitive to local needs and wants and to demonstrate the ways in which the desired behavior (cooperation) will meet local interests” (p. 275).

6. Organizational Design • The way a marketing department (e.g., national headquarters) is organized internally, as it grows, can affect how the department is run and what types of people can be employed. • After marketing has been established, what organizational structure is best for the organization? Andreason & Kotler says, “The options typically found in the private sector as design alternatives can be adapted to nonprofit marketing with limited rethinking” (p.275).

7. Organizational Design (Continued) • These alternatives are: • Functional Organization • public relations, advertising, and marketing research are kept as separate functional units within marketing with a single employee responsible for each unit (initially); as the marketing group grows, each function will have its own manager • Product/Service-Centered Organization • one person is put in charge of a specific product or service • Customer-Centered Organization • focus on marketing the needs and wants of the each customer group • If not chosen as alternative, a customer perspective must be adopted • Mixed organization (p.275)

8. Organizational Design (Continued) • See Figure 10-1 (p. 276) in Andreasen & Kotler for the Alternative Organizational Designs/Structures • When choosing one of the three alternative organizational structure designs, an organization’s mission, objectives, goals, experience, and market conditions should be considered.

9. Implementing a Customer Orientation • The marketing manager cannot make an impact on how the people in the organization treat and act toward customers by choosing a customer-oriented structure. • It is very important that the marketing manager gradually instills the proper philosophy to “build up a market-oriented organization” (p. 279). • Achieving a customer orientation requires the following measures, which will hopefully produce a market-oriented organization within three to five years. • Top Management Support • Effective Organization Design • In-Company Marketing Training • Better Employee Hiring Practices • Rewarding Market-Oriented Employees • Planning System Improvement (p.279-281)

10. Implementing a Customer Orientation (Continued) • Top Management Support • To develop a strong marketing orientation, the CEO must believe in it, understand it, want it, and wins the support of other high-level executives. • Effective Organization Design • Marketing manager must be added in a staff or line position and be capable of influencing other top managers. • In-Company Marketing Training • Marketing executive should first introduce marketing to the top corporate and divisional management at the organization’s headquarters or at a retreat. Should conduct professional presentations of concept, cases, and marketing planning exercises. • Then presentations can be made to operations people, financial people, and others in the organization to help them understand. Presentations should include market opportunity identification, market segmentation, market targeting and position, marketing planning and control, pricing, selling, marketing communication.

11. Implementing a Customer Orientation (Continued) • Better Employee Hiring Practices • Hire caring people. • Require training for new employees emphasizing the importance of customer satisfaction. Train them on skills in listening and customer problem solving solutions. Teach them on how to handle complaining & abusive customers. • Rewarding Market-Oriented Employees • Employees who have done an outstanding job of serving customers should be commended by being acknowledged as employee of the month, etc. Post certificate for others to view. • Planning System Improvement • Design and install an organization planning system with good strong marketing data and analysis (p. 280-281).

12. Customer-Driven Organizational Change • Most large and bureaucratic nonprofit organizations are resistant to change because of their success and the fact that they are very dominant or a monopoly in their field (p.281). • Customer-driven approaches can ensure effective organizational change particularly in large nonprofits whose national offices have regional divisions as customers.

13. Customer-Driven Organizational Change (Continued) • The American Cancer Society is a good example of a large nonprofit who was resistant to change. • Regional and local officials were criticizing the central operation. • The biggest complaint was that “national” was not customer-oriented. • A change was made to become customer-driven. • Materials and training programs were implemented to meet the needs and likes of the division. • A department could not grow unless it met the customer's (division) needs. (p.282)

14. Bibliography • Andreasen & Kotler, “Strategic Marketing for Nonprofit Organizations,” 2003 Prentice Hall, Sixth edition.