Transcript Part One - Lingnan University

Chapter Seven
Weaving Marketing into
the Fabric of the Firm
LEARNING OBJECTIVES

Introduce market orientation concept

Describe the internal partnerships that must be
developed with marketing

Discuss how marketing learns
7-2
MARKET ORIENTATION CONCEPT




What is a Market Orientation
Components of Market Orientation
How Market Orientation Impacts Performance
Spanning Process
7-3
What is Market Orientation
1.
2.
3.
The systematic gathering of information on customers and
competitors, both present and potential
The systematic analysis of the information for the purpose of
developing market knowledge
The systematic use of such knowledge to guide strategy
recognition, understanding, selection, implementation and
modification
A market-oriented firm should - benefit from better marketing
programs; be difficult for competitors to identify;
be unique
7-4
Components of Marketing Orientation
1.
Establish a corporate culture where every employee values
their customers
2.
Listening to the voice of the customer throughout the entire
company
3.
Developing superior skills to understand and satisfy
customers
A market orientation must exist in the culture of the organization
(part of the values & norms of the organization)
A company needs a market orientation in order to learn
successfully.
7-5
How Market Orientation Impacts Performance
1.
Do a better job of market sensing



2.
Anticipating market requirements ahead of competition
Marketing research is one form of market sensing
Can be achieved through listening to the salesforce, observing
competition at trade shows, and developing stronger ties with
innovative customers and suppliers
Be able to develop stronger relationships


With customers
With channels of distribution
7-6
Spanning Process
CUSTOMER NEEDS
Inputs by customers
through sales, service,
information seeking
LINKS
Spanning activities
that provide
decision-making
information
COMPANY
CAPABILITIES
Defined by all
organization functions
- Spanning processes link the firm’s internal processes with the
customer
- Market oriented firms must have adequate spanning processes
7-7
EXTERNAL EMPHASIS
INTERNAL EMPHASIS
Outside-in
Process
Inside-Out
Process
Spanning Process
• Market Sensing
• Customer
Linking
• Channel
Bonding
•Technology
Monitoring
• Customer Order Fulfillment
• Pricing
• Purchasing
• Customer Service Delivery
• New Product / Service
Development
• Strategy Development
• Financial Management
• Cost Control
• Technology
Development
• Integrated Logistics
• Manufacturing/Transformation Process
• Human Resources
Management
• Environmental Safety
Health and Safety
7-8
PARTNERSHIP IN MARKETING

Internal Partnering – The process of creating partnerships with
other functional areas within the firm

Partnerships are characterized by open communication,
trust and commitment to the partner.
−
−
−

Partners are able to align their goals with the goals of the other
Silo structure is with high walls built around the departments and no
ability or desire to go between the departments
The creation of internal partnerships
Internal Partners
7-9
Stages of Internal & External Partnering
AWARENESS
EXPLORATION
EXPANSION
COMMITMENT
ACHIEVING THE
SUPRAGOAL:
CUSTOMER SATISFACTION
7-10
Internal Partners
PURCHASING
MANUFACTURING AND
ENGINEERING
(R&D)
MARKETING
FINANCE
7-11
Encouraging Integration in Marketing Operations
Develop & Articulate Strategic Decisions
that Will Be Implemented
Pursue Personnel Stability to Enhance Long Term Rapport
Level the Budget and Compensation Playing Field That
Supports Marketing Efforts
Establish Clear and Formalized Communication /
Organizations Structures
7-12
Typical Marketing Organizational Structure
MARKETING DIRECTOR
SALES
PRODUCT
DEVELOPMENT
MARCOMM
MARKETING
RESEARCH
7-13
Customer Focused Team Structure
Sales
Account
Manager
Engineering
Engineering
Rep
Customer
Mfg. Rep
Shipping
Rep
Purchasing
Agent
Purchasing
Manufacturing
Shipping
Finance
Rep
Finance
7-14
HOW BUSINESS MARKETERS LEARN
THE THREE-STEP PROCESS
1
INFORMATION
ACQUISITION
Marketing Research
Sales and Service Feedback
Environmental Scanning
Competitive Intelligence
Accounting Systems
Information Systems
Experiments
Benchmarking
Joint Venture
Lead Customers
Organizational Memory
2
INFORMATION
DISSEMINATION
To:
Marketing Management
Senior Management
Manufacturing
Engineering and R&D
Finance
3
SHARED
INTERPRETATION
Through:
Brainstorming
Planning
Other Processes
7-15
Tools to Generate New Knowledge
• COGNITIVE MAPPING
– Finding links of cause and effect through exploring beliefs and
assumptions
• EXPERIMENTS
– Research that tests cognitive maps
• LEARNING LABORATORIES
– A physical environment set aside for learning through experiments,
simulations, models and role playing
• LEARNING FROM OTHERS
– Getting knowledge from partners, consultants, seminars, and
competitors.
7-16
Cognitive Maps—MAP 1
Example: Kinko’s
Observation
More
competitors
means less
business per
store
+
Observation
Observation
Kinko’s stores
compete with
each other
when located in
the same city
because of free
delivery service
Have fewer
stores in a city
=
7-17
Two Cognitive Maps—MAP 2
Observation
Observation
Advertising
drives
awareness
Each store has
signage or
advertising
Assumption
Observation
Conclusion 2
More stores
mean more
awareness
Higher
awareness
means more
business
Have more
stores in a city
=
7-18