Marketing Organisation, Strategic Planning, Organisation and Control

1. Marketing Organisation, Strategic Planning, Organisation and Control Pesewa Presentations

2. Why do we need to organise international marketing activities? • The way in which an organisation is structured helps determine: • how effectively and efficiency it exploits opportunities; • its capacity for responding to problems and challenges. • No one best way. • Issues: • definition of organizational units; • centralization vs. decentralization; • assignment of reporting and control system.

3. Centralisation vs decentralisation • Factors influencing centralisation vs decentralisation: • management philosophy and style. • Centralisation: • efficiency, consistency, avoidance of duplication. • the challenge of rapid technological change may best be met by centralised R&D. • Decentralisation: • local responsiveness and adaptation.

4. Organisational Structure • Organizational Design • Stages used when expanding overseas • Export department • The creation of an export department structure is usually the first step in the functional organization toward entry into foreign markets • Usual initial form for export marketing. • Allows the building up of international expertise. • International division • As the export revenue share increases and there are several countries in the strategic portfolio, the firm changes to an international division structure • Provides single, coordinated management of international business across product lines and countries. • Problem: lack of built-in key product/technology competencies.

5. Organisational Structure • Geographical/regional structure • As overseas sales expand and the management of the countries takes more time and resources, the firm usually subdivides the international division into country groups or trade regions • Area presidents have responsibility for profit and performance. • Useful for companies with wide geographical spread and relatively narrow product lines: food, beverage, automobile, pharmaceutical industries. • Emphasises importance of regional characteristics. • Within regions, product managers have internal staff support. • Problems: difficulty in spreading of new products; duplication of staff; coordination of planning; coordination of R&D.

6. Organisational Structure • Organisational Design • Stages of expansion (cont’d) • Global product divisions • Regional and local managers’ authority is subordinated to that of the global division chief, who approves and directs • Used by companies with several dissimilar product lines. • Meets special requirements of products and supporting technologies. • Most appropriate where standardised marketing mix is more important than individualisation for local needs. • Problems: duplication of staff and activities; lack of international coordination between product lines. • Product line coordinators may ease problems.

7. Organisational Structure • Matrix organisations • Organisations in which both country and product receive equal emphasis. • Mixed approach combines two or more competencies on a worldwide basis: geographic knowledge; product knowledge; functional competence; or knowledge of customer or industry. • Staff members have two or more bosses; work as members of more than one competency group. • Advantages: emphasises more than one competency (e.g., provide market and product knowledge). • Disadvantages: unclear decision-making structure; slower decision making; built-in tendency for conflict.

8. People and Organisational Culture • Local Acceptance • Global marketing strategy often requires a great deal of work on the part of local managers • Local conditions are frequently different from other places • Corporate Culture • Methods that people and organizational culture use to enhance effective communication • Build a strong corporate culture internationally • Build a common technical or professional culture • Build strong financial and planning systems

9. People and Organisational Culture • The Expatriate manager • Typical leadership roles of the expatriate manager • Role 1 – Customer representative • The expatriate manager must serve as a high-level contact with existing customers, prospects and suppliers in the local market • Role 2 – Local champion • The expatriate manager must be a champion for the local office at headquarters • Role 3 – Network coordinator • The expatriate management must provide linkages with the firm’s other offices in the worldwide network of the firm

10. Conflict Resolution • Conflict Resolution Practices • Let country managers retain local brands and marketing budgets • Solicit country managers’ input for new-product development • Give country managers lead roles in global teams • Provide international transfers for country managers • Involve the country manager in the formulation of the global marketing strategy