SUBMITTED TO

Muhammad Mizanoor Rahman HowladerLecturer, Department of Marketing, PSTU.

SUBMITTED BY

Shofiq uddin khanPSTU+8801717552517

CHAPTER 17

Carleton “ Carly ” S. Carleton “ Carly ” S. FiorinaFiorina

PREFACE PREFACE OF THE CHAPTEROF THE CHAPTER

In the global marketing environment, a firm mustIn the global marketing environment, a firm must

have a global vision and strategy. By providing have a global vision and strategy. By providing

leadership, organizing a global effort, and establishing leadership, organizing a global effort, and establishing

control producers, a firm can exploit global opportunities. control producers, a firm can exploit global opportunities.

Leaders must have a vision, in addition to the technical Leaders must have a vision, in addition to the technical

resources, to build global competencies. For global resources, to build global competencies. For global

marketing control practices to be effective, differences marketing control practices to be effective, differences

from purely domestic control must be recognized and from purely domestic control must be recognized and

implemented in planning and control practices.implemented in planning and control practices.

This chapter focuses on the integration of each This chapter focuses on the integration of each element of the marketing mix in to a total plan that element of the marketing mix in to a total plan that addresses expected opportunities and threats in the addresses expected opportunities and threats in the global marketing environment.global marketing environment.

Leaders must be capable of articulating a coherent Leaders must be capable of articulating a coherent global vision and strategy that integrates local global vision and strategy that integrates local responsiveness, global efficiencies, and leverage. responsiveness, global efficiencies, and leverage. The challenge is to direct the effort and creativity The challenge is to direct the effort and creativity of everyone in the economy towards a global of everyone in the economy towards a global effort that best utilizes organizational resources to effort that best utilizes organizational resources to exploit global opportunities. exploit global opportunities.

CHAPTERCHAPTERCONTENTCONTENT

LEADERSHIP ORGANIZATION

GLOBAL MARKETING

MANAGEMENT AUDIT

LEADERSHIP

Leadership is not about hierarchy or title or status, it is about having influence and mastering changes. Leadership is not about bragging rights or battles or even the accumulation of wealth, it’s about connecting and engaging at multiple levels. It’s about challenging minds and capturing hearts, leadership in this new era is about empowering others to decide for themselves. Leadership is about empowering others to reach their full potential. Leaders can no longer view strategy and execution as abstract concepts, but must realize that both elements are ultimately about people. Now a days “Global marketing” demands exceptional leadership.

TERMS OF LEADERSHIPTERMS OF LEADERSHIP

TEAMSThe practice of using self-directed work team to respond to competitive challengers is becoming more widespread. Companies are looking to reduce bureaucracy and hierarchy to improve responsiveness and reduce costs. As tom peter put it, ’’you can not survive, let alone thrive. In a time, there was competitive world with a six to eight layer organization structure. In this time obsessed organization is flat – no barriers among functions, no borders with the out side.

MIND - SETA major role of top management is to install important values necessary for success in a global marketplace throughout their organization. One critical value vital to an effective global organization is to have the proper mind set for both the leadership and the organization.

ORGANIZATIONLeading edge global competitors share one key organizational design characteristics. Their corporate structure is simple and flat, rather than tall and complex. Simple structures increase the speed and clarity of communication and allow the concentration of organizational energy and valuable recourses on learning, rather than on controlling monitoring and reporting. In today’s fast changing, competitive global environment corporations have to find new and more creative ways to organize. New forms of flexibility, efficiency, and responsiveness are required to meet the market demands. The need to be cost - effective , to be consumer driven , to deliver the best the quality , and to deliver that quality quickly Are some of today’s market realities.

PATTERNS OF INTERNATIONAL ORGANIZATIONAL DEVELOPMENTOrganization very in terms of size and potential of targeted global markets and local management competence in different country markets. Conflicting pressures may arise from the need for product and technical knowledge. Most companies undertake initial foreign expansion with an organization similar to that in figures 17-1 and 17-2.

Figure: 17-1 functional corporate structure, domestic corporate orientation, preinternational division

Figure 17-2 divisional corporate structure, domestically oriented product division staff, preinternational division

Regional management can offer a company several advantages. Many regional managers agree that an on the scene regional management unit makes scene when there is a real need for coordinated pan regional decision. Coordinated regional planning and control is becoming necessary as the national subsidiary continues to lose its place as an independent operating unit.

GEOGRAPHIC STRUCTUREGEOGRAPHIC STRUCTURE

The geographic structure involves the The geographic structure involves the assignment of operational responsibility for assignment of operational responsibility for geographic areas of the world to line geographic areas of the world to line managers. The corporate headquarters managers. The corporate headquarters retains responsibility for worldwide planning retains responsibility for worldwide planning and control and each area of the world and control and each area of the world including the home or base market is including the home or base market is organizationally equal. The major organizationally equal. The major international oil companies utilize the international oil companies utilize the geographic structure.geographic structure.

When an organization assigns worldwide product responsibility to its product divisions, the product divisions must decide whether to rely on an international division, thereby dividing their world into domestic and foreign, or to rely on an area structure with each region of the world organizationally treated on an equal basis. There are two stages in the internationalization of the product divisions, the first stage occurs when international responsibility is sifted from a corporate international divisions o the product division international departments. The second occurs when the product divisions themselves shift international responsibility from international departments within the division to the total divisional organization.

THE MATRIX STRUCTURETHE MATRIX STRUCTUREThe most sophisticated organizational arrangement brings to bear four basic competencies on a worldwide basis, these competencies are as follows:1: Geographic knowledge2: Product knowledge and know how to 3: Functional competences in such fields as finance, production, and especially marketing4: knowledge of the customer or industry and its needs

STRUCTURING FOR GLOBAL BRANDS

Global brands requires a much greater emphasis on integrating and/or globalizing the marketing process at a world wide level as well as promoting and embedding within the corporate culture inter and intra organization. They identified eight new organizational arrangements to support global brand management:

1.Global coordination groups 2.Strategic planning groups3.Lead country concept4.Global brand managers5.Starbursts6.Cluster organizations7.Strategic alliances, joint ventures, mergers and acquisitions8.Network structures

IMPLICATIONS FOR CHANGING ORGANIZATIONAL STRUCTURE

Based on their research, Hankinson and Hankinson identified the following eight implications for management in global companies.

1. Declining profitability and shareholder value are greater motivators of change than increasing economic turbulence.2. A charismatic or transformation style of leadership is helpful.3. Those who implement change need a firm grasp on all aspects of the business.4. A correct balance between long-term strategic objectives and short-term attention to shareholder value.5. "Loose-tight" balance. (The balance of power shifts back and forth from the headquarters to the regional offices.)6. Employees need to learn to behave differently and a learning culture helps to achieve this.7. knowing when the strategic imperative is strong enough to require changes to the organizational structure.8. A loose organizational structure requires a common understanding, of the measures of success

Global marketing presents formidable problems to managers responsible for marketing control. Each national market is different from every other market, Distance and differences in language, custom, and practices create communications problems.In the managerial literature, control is defined as the process by which managers ensure that resources are used effectively in the accomplishment of organizational objectives.

THE GLOBAL MARKETING AUDIT

A global marketing audit can be defined as a compressive, systematic, and periodic examination of a company’s or business unit’s marketing environment, objectives, strategies, programs, policies, and activities, which is conducted with the objective of identifying existing and potential problems and opportunities and recommending a plan of action to improve a company’s marketing performance.A full marketing audit has two basic characteristics. The first is that it is formal and systematic. The effectiveness of an audit normally increases to the extent that it involves a sequence of orderly diagnostic steps as is the case in the conduct of a public accounting audit.

The second characteristic of a marketing audit is that it is conducted annually. Most companies in trouble as well on their way to disaster before the trouble is fully apparent.Audits are either independent or internal. An independent marketing audit is conducted by someone who is free from influence of the organization being audited. The independent audit may or may not be objective.An internal or self audit may be quit valuable because it is conducted by the company’s marketing personnel who understand the industry. However, it may lack the objectivity of an independent audit.

SETTING OBJECTIVES AND SCOPE OF THE AUDIT

The first step of an audit is a meeting between company executives and the auditor to agree on objectives, coverage, depth, data sources, report format, and time period for the audit. The steps of marketing audit are as follow:

1.Gathering data2.Analyzing the data3.Preparing and presenting the report

COMPONENTS OF MARKETING AUDIT

There are six major components of a full global marketing audit

1.Marketing environment audit2.Marketing strategy audit3.Marketing organization audit 4.Marketing systems audit5.Marketing productivity audit 6.Marketing function audit

Planning and budgeting are two basic tools of monitoring the global marketing effort. Planning involves expressing planned sales, profit objectives, and expenditures on marketing programs in unit and money terms and these are translated into a budget. the budget spells out the financial objectives and necessary expenditures to achieve these objectives. Monitoring consists of measuring actual sales and expenditures. In the ease of no variance or a favorable variance between actual and budget, no action is usually taken, an unfavorable variance-lower unit sale than planned. They will investigate and attempt to determine the cause of the unfavorable variance and what might be done to improve performance.

INFLUENCES ON MARKETING PLANS

AND BUDGETSIn preparing a budget or plan the flowing factor are important:

Market PotentialHow large is the potential market for the product being planned? In every domestic market, Management must address this question in formulating a product Plan. A company that introduces a product in more than one national market must answer this question for etch market.

CompetitionA marketing plan or budget must be prepared in

light of the competitive level in the market. the more entrenched the competition, the more difficult it is to market share and the more likely a competitive reaction will occur to any move that promises significant success in the target market. Competitive moves are particularly important as A variable in international market planning because many companies are moving from Strong competitive positions in their base markets to foreign markets in which they have a minor position and must compete against entrenched companies. These standards and exceptions are simply not relevant to a market in which the company is in a minor position trying to break into the market.

•Impact of Substitute Products

One of The sources of competition tom a product in a market is the frequent existence of substitute products. As a product is moved into markets at different stages of development, improbable substitute products often emerge

Process The manner in which targets are communicated

to subsidiary management is as important as the way in which they are derived. One of the most sophisticated methods used today is the so-called indicative planning methods. Headquarters' estimates of potential are disaggregated and communicated to subsidiary management as guidance.

Share of MarketAnother principal measure of marketing performance

is share of market. this is valuable measure because it provides a comparison of company performance with that of other competitors in the market. Companies that do not obtain this measure, even if it is an estimate, are flying blind. In smaller markets, it is possible for a country manager or agent to hide a deteriorating market position or share of market behind absolute gains in sales and earnings.

Informal Control MethodsIn addition to budgeting, informal control

methods play an important role. The main informal control method is the transfer of people from one market to another. When people are transferred, they take with them their experience in previous market, which will normally include some standards for marketing performance. When investigating a new market that has lower standards than a previous market, the investigation will lead to revised standards or to discovery of why there is difference.