An organization is composed of a group of individuals striving to achieve organizational goals.

In pursuing this mission, they are often formed into sub-groups or departments.

Sub group or department that is capable of achieving pre set qualitative and quantitative sales objectives of the organization. Two basic objectives are: Attaining targeted sales, market share & profits. Achieving customer satisfaction level.

The survival of an organization depends on the effectiveness of the sales and marketing department. First emerged in manufacturing organizations. Now in service sector like insurance,banking,postal service,defence forces,healthcare,agriculture etc.

To divide and fix authority among the subordinates. To locate responsibility. To establish sales routine. To enforce proper supervision of sales force. To stimulate the efforts of those concerned with selling. To enable the top executives to devote more time to planning policy matters.

Nature of the market. Sales policies of the enterprise. Nature of the products. Number of the products. Availability of financial resources. Level of distribution system.

Size of the company. Price of the product. Ability of the professionals.

 Size

of a MO refers to the

level of sales force activity, levels of hierarchy, no. of persons involved in the organizational chart.

 Size

depends on: no. of products, type of products, distribution channel, type of consumers, volume of business, marketing setup of competitors

Two types:-

Production-oriented organization.

Sales-oriented organization.

Role of production staff is dominating. Have a undeclared philosophy to give importance to production. Selling becomes less important to production. All sales functions are influenced by production facilities.

Situation where organization members are more concerned with the sales, distribution and customer satisfaction. More concern over the improvement of sales and marketing effort of the company.

Must be clear line of authority running from the top to the bottom of the organization. Authority should be delegated as far down the line as possible. Should be limit to the number of positions that can be coordinated by a single executive. No. of levels of authority should be kept at a minimum.

Organization should be flexible so that it can be adjusted to changing conditions. Organization should be kept as simple as possible. Responsibility and authority of each level should be clearly defined. No one in organization should report to more than one line authority.

Performs the activities of personnel department. Marketing research activities come under the direct supervision of marketing manager. Responsible for taking decisions in respect of credit facilities to be provided. Product planning and development activities are also directed by marketing manager.

Decisions regarding the channels of distribution. Supervision over advertising and sales promotion activities. Decisions regarding after sale services to be provided.

Analyzing the market thoroughly by a good market research. Undertake effective planning of advertising campaign. Ensure effective coordination of sales policy with production policy. Provide an effective leadership to the staff under him by guiding, encouraging and controlling them.

Responsible for marketing operations like: Departmental organization Recruiting Selecting Training Equipping Paying Stimulating and supervising marketing personnel.

Function oriented marketing organization.

Product oriented marketing organization. Customer oriented marketing organization.

Geography oriented marketing organization.

When departmentation of MO is done on the basis of sales activities. Functional specialists are appointed. Functional specialists are in charge of their respective departments like advertisement, marketing, sales promotion, sales planning etc.

GM(Marke ting)
M1 Customer satisfaction M6 Market research

M2 sales

M3
Advertising

M4 Distribution

M5 Service

Quality manager

Sales promotion manager

MERITS
Enjoys all advantages of specialization. Similar type of activities can be grouped under a particular department.

Demerits
The evils of specialization may hinder the progress. It is difficult to establish coordination among different departments

Done when the enterprise manufactures or markets different types of products. Separate sales executives are appointed for each product. Each product has separate departments and technical staff. Each product executive can focus his attention to his products sales and market strategies.

GM(Marketing)

Product A SM

Product B SM

Product C SM

Product D

SM

Brand Manager

Merits
The salesmen can render better customer service. Profitability of each product can found easily. Suited where there are product differences and the product lines are complex. New product introduction will not affect marketing structure.

Merits
Healthy competition can be maintained between different products. Top executive can have detailed information on marketing condition of each product. Leads to specialization.

Demerits Expensive and wastage of time of sales personnel. Difficult to establish coordination between different departments. Cause confusion in the mind of customers.

Departmentation is done on customer basis. Departmentalization on the basis of distribution channels. Customers may fall into distinct groups in terms of buying practices or product preferences. Sales efforts are limited to a selected group of customers.

Merits
Will provide maximum satisfaction to customers. Customers can be paid special attention according to their varying needs.

Demerits
Adds to the administrative and selling costs due to specialization of sales force. Not suitable for small enterprises. Coordination between departments becomes difficult.

Best suited for companies having wide area of operations. Total market area is divided into territories. Separate marketing executive and team for each territory.

Merits

Local problems and local market conditions can be understood and tackled efficiently. Healthy competition arise among the executives of territories. Comparison of sales among territories is possible. Transportation cost is reduced considerably

General Manager

Area manager
East

Area manager
North

Area manager
South

Area manager
West

Increased functional breadth and change in management concept. Sales and marketing functions not clearly spelt out. Problem of delegation of responsibility. Centralized decision making systems. Performance appraisal and compensation. Line of authority and responsibility without clarity. Line communication gap within the organisation. Office facilities

Universal conflict area is between marketing department and manufacturing department. Production department would prefer large production with minimum machines. Marketing department always looks after the wants and needs of customers. Incomplete specification of products create misunderstanding and conflict with the production department.

Finance department monitors the sales and profit performance and points out major deficiencies. Sometimes delay approval of funds and additional expenditures. Marketing department feels that finance department is too rigid and not pragmatic in serving customers will.

Always conflict between R & D and marketing department. Marketing department always look after R&D to ensure whether the research are done with a view of satisfying customers.

Marketing department is one of the vital part of any business organization. With the growth of business volume and competition, MO expanded to other activities. As a result of this inevitable conflict arises between marketing staff and field sales force.

To overcome this, many companys separated marketing function from sales function. Coca Cola, Sony, Unilever, IBM etc successful as true marketing companies.