marketing and corporate strategies. kinds of organizations profit organizations. a privately owned...
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Marketing and corporate strategies
Kinds of organizations
• Profit organizations. A privately owned organization that serves its customers in order to earn a profit
• Nonprofit organizations. A nongovernmental organization that serves its customers but does not have a profit as an organizational goal.
Levels in organizations
• Corporate level. Where top management directs overall strategy for the entire organization.
• Business Unit Level. Level at which business unit managers set direction for their products and markets.
• Functional level. Is where groups of specialists create value for the organization. (i.e. departments)
Three levels of strategy in an organizationThree levels of strategy in an organization
Research &development
Informationsystems
Finance Marketing
Manufacturing
Human resources
Business unit strategy• Mission• Business goals• Competencies
Business unit strategy• Mission• Business goals• Competencies
Corporate strategy• Vision• Corporate goals• Philosophy and culture
Corporate strategy• Vision• Corporate goals• Philosophy and culture
Functional strategy
Combination of Customer Relationships
TheOrganization’s
Success
Quality
CustomerRelationships
Efficiency
Innovation
Strategy at the corporate level
Corporate vision is . . . . Corporate vision is . . . .
a clear word picture of the organization’s future, often with an inspirational theme.
It sets the overall direction for the
organization, describing what it strives to be--
stretching the organization, but not beyond
reason.
a clear word picture of the organization’s future, often with an inspirational theme.
It sets the overall direction for the
organization, describing what it strives to be--
stretching the organization, but not beyond
reason.
A goal is . . . . A goal is . . . .a targeted level of performance set in advance of work. Therefore, corporate goals provide strategic performance targets that the entire organization must reach to pursue its vision.
a targeted level of performance set in advance of work. Therefore, corporate goals provide strategic performance targets that the entire organization must reach to pursue its vision.
Corporate goals may be articulated in terms of:
- profits - quality
- sales revenue - employee welfare
- market share
- social responsibility
- unit sales
Corporate Philosophy and Corporate Philosophy and CultureCulture
Corporate philosophy establishes the values and “rules of conduct” for running the organization.
Corporate culture refers to a system of shared attitudes and behaviors held by the employees that distinguish it from other organizations.
Strategy at the Business Unit Level
Business Unit Mission and Business Unit Mission and GoalGoal
The business unit mission is a statement that specifies the markets and product lines in which a business will compete. It communicates the scope of a business unit.
A business unit goal is a performance target the business unit seeks to reach in an effort to achieve its mission. Goals that are more specific, measurable and quantifiable are called objectives.
Boston Consulting Group Growth-Share Boston Consulting Group Growth-Share MatrixMatrix
Mar
ket
gro
wth
rat
e
10x High 1x Low 0.1xRelative market share
(share relative to largest competitor)
?
Cashcow
Star
Dog
Questionmark
B
C
D
A
20%
High
10%
Low
0%
Objectives for each SBU
• Build. Increase market share through cash injection. Make Starts out of Question marks.
• Hold. Maintain market share. Often used for Cash Cows which are already generating large amounts of cash
• Harvest. Increase short-term cash output of the SBU. Pump cash from Dogs or Cash Cows into Stars or Question Marks.
• Divest. Sell the SBU. Question Marks and Dogs are ideal candidates
Specifying the SBU’s Competencies: Specifying the SBU’s Competencies: Some Important DefinitionsSome Important Definitions
benchmarking is . . . . benchmarking is . . . .
quality is . . . quality is . . .
competitive advantage is . . .competitive advantage is . . .
Strategy at the Functional Level
Marketing and other functional departments create their own functional goals –really extensions of corporate and business unit goals.
The Strategic Marketing Process
• Where are we now?• Where do we want to go?• How do we allocate our resources to get
where we want to go?• How do we convert our plans into action?• How do our results compare with our plans,
and do deviations require new plans and actions?
Marketing Plan
• The strategic marketing process is usually formalized in a Marketing Plan, which is a road map for the marketing activities of an organization for a specified future period of time.
The strategic marketing processThe strategic marketing process
Marketing plan
Market-product focusand goal setting
Situation (SWOT)analysis
Marketingprogram
ImplementationPhase
ControlPhase
Results
Planning phase
Corrective A
ction
Market-product focusand goal setting
Situation (SWOT)analysis
Marketingprogram
Planning phase
StrengthsWeaknessesOpportunities
Threats
•Market Penetration / New Markets•Product Development•Diversification
Market-product focusand goal setting
Situation (SWOT)analysis
Marketingprogram
Planning phase
•Market Segmentation. Aggregating prospective buyers into groups, or segments that have: common needs and will respond similarly to a marketing action.
•Selecting the target markets.
•Finding points of difference for the product. (Competitive advantage)
Market-product focusand goal setting
Situation (SWOT)analysis
Marketingprogram
Planning phase
•Developing the marketing mix (4 Ps)•Developing the budget
Elements of the marketing mix that compose a cohesive Elements of the marketing mix that compose a cohesive marketing programmarketing program
PlaceOutletsChannelsCoverageTransportationStock level
PlaceOutletsChannelsCoverageTransportationStock level
PromotionAdvertisingPersonal sellingSales promotionPublicity
PromotionAdvertisingPersonal sellingSales promotionPublicity
PriceList priceDiscountsAllowancesCredit itemsPayment period
PriceList priceDiscountsAllowancesCredit itemsPayment period
ProductFeaturesBrand namePackagingServiceWarranty
ProductFeaturesBrand namePackagingServiceWarranty
Marketingmanager
Marketingmanager
Cohesive marketing mix
PromotionPlace
Price
PromotionPlace
Product
• The implementation phase involves executing the marketing plan and putting it into effect:– Obtaining resources (money and
personnel)– Designing the marketing organization– Developing schedules– Executing the marketing program (strategy
and tactics)
ImplementationPhase
Organization of a Typical Manufacturing Organization of a Typical Manufacturing Firm, Showing a Breakdown of the Firm, Showing a Breakdown of the
Marketing DepartmentMarketing Department
President
Vice President Research and Development Department
Vice PresidentManufacturingDepartment
Vice PresidentMarketingDepartment
Vice PresidentAccount andFinanceDepartment
Vice PresidentHumanResourcesDepartment
Manager Product Planning
Manager Marketing Research
Manager Sales
ManagerAdvertising &Sales Promotion
Sales Regionsand
Representatives
Strategy versus Tactics
• Strategy means by which a goal is to be achieved, characterized by a specific target market and a marketing program to reach it
• Tactics are detailed day-to-day operational decisions essential to the overall success of marketing strategies
• Comparing results with plans to identify deviations– Finding the planning gap
• Acting on deviations– Performance less than expected –
Corrective action– Performance greater than expected –
Uncover the reason
ControlPhase