Chapter 17

Organizing and Planning

for Effective
Implementation

McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Organizational Structures
● Structural variables that are important in shaping an
SBU’s and its marketing department’s performance
within the context of a given competitive strategy
● Formalization
● Centralization
● Specialization
● Highly structured business units and marketing
departments are unlikely to be very innovative or
quick to adapt to a changing environmental
circumstance

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Organizational Structures
● Adaptiveness and innovativeness are enhanced when:
● Decision-making authority is decentralized
● Managerial discretion and informal coordination
mechanisms replace rigid rules and policies
● More specialists are present

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Organizational Structures
● Several common organizational designs incorporate
differences in both the structural variables and in the
mechanisms for resolving interfunctional conflicts:
● Functional
● Product management
● Market management
● Various types of matrix organizational designs

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Exhibit 17.4 - Functional Organization of
an SBU and Its Marketing Department

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Exhibit 17.5 - A Marketing Department
with a Product Management Organization

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Exhibit 17.6 - A marketing department
with a Market Management Organization

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Organizational Structures
● Matrix organizations
● The least bureaucratic or centralized and the most
specialized type of organization
● Brings together two or more different types of
specialists within a participative coordination structure
● Suits prospector businesses and the management of
new product development projects within analyzer or
differentiated defender businesses

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Recent Trends in Organizational
Design
● Organizations will increasingly emphasize the
managing of business processes in contrast to
functional areas
● Managing processes will make the organization
essentially horizontal—flat and lean versus a
vertical or hierarchical model
● The use of self-managing teams is increasing
● In the future many companies will use teams as the
basis for collaborative networks that link
thousands of people together with the help of a
variety of new technologies
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Recent Trends in Organizational
Design
● A major difficulty, especially for those involving
companies from different parts of the world, is that
they cannot be controlled by formal systems, but
require a dense web of interpersonal connections
and internal infrastructures that enhance learning

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Organizational Adjustments as Firms
Grow and Markets Change
● Key drivers that help managers decide when the
time has come to restructure an organization, and
what new structure should replace the old one:
● Customer needs
● Informational requirements of the sales and marketing
personnel charged with meeting those needs
● Ability of a given structure to motivate and
coordinate the kinds of activities that market
conditions require
● Available competencies and resources
● Costs

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Organizational Adjustments as Firms
Grow and Markets Change
● Growing firms or those serving rapidly changing
markets are likely to need to rethink—and perhaps
change—the structure of their sales and marketing
organizations frequently

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Marketing Plans: The Foundation for
Implementing Marketing Actions
● Preparation of a written plan is a key step in ensuring
the effective execution of a strategic marketing
program because it spells out what actions are to be
taken, when, and by whom

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Exhibit 17.8 - Contents of an Annual
Marketing Plan

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The Situational Analysis
● Market situation - Data are presented on the target
market
● Competitive situation - Identifies and describes the
product’s major competitors in terms of their size,
market share, product quality, marketing strategies,
and other relevant factors
● Macroenvironmental situation - Describes broad
environmental occurrences or trends that may have a
bearing on the product’s future

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The Situational Analysis
● Past product performance - Discusses the product’s
performance on such dimensions as sales volume,
margins, marketing expenditures, and profit
contribution for several recent years
● Sales forecast and other key assumptions -
Typically includes estimates of sales potential, sales
forecasts, and other evidence or assumptions
underlying the plan

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Key Issues
● After analyzing the current situation, the product
manager must identify the most important issues
facing the product in the coming year
● These issues typically represent either threats to the
future market or financial performance of the product
or opportunities to improve those performances

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Objectives
● Financial objectives: Provide goals for the overall
performance of the brand and should reflect the
objectives for the SBU as a whole and its competitive
strategy
● Marketing objectives: Specify the changes in
customer behavior and levels of performance of
various marketing program elements necessary to
reach the product’s financial objectives

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Marketing Strategy
● The manager must now specify the overall
marketing strategy to be pursued
● The chosen strategy should fit the market and
competitive conditions faced by the product and its
strategic objectives
● It should also incorporate all of the necessary
decisions concerning the 4Ps

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Action Plans
● The most crucial part of the annual marketing plan
for ensuring proper execution
● The specific actions necessary to implement the
strategy for the product are listed, together with a
clear statement of
● Who is responsible for each action
● When it will be done
● And how much is to be spent on each activity
● Specific timelines and milestones are set forth

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Projected Profit-and-Loss Statement
● The action plan includes a supporting budget that is
essentially a projected profit-and-loss statement
● This budget is then presented to higher levels of
management for review and possible modification
● Once approved, the budget serves as a basis for the
plans and resource allocation decisions of other
functional departments within the SBU

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Contingency Plans
● The manager might also detail contingency plans to
be implemented if specific threats or
opportunities should occur during the planning
period

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