© 2005 Prentice Hall16-1 Chapter 16 Leading, Organizing, and Controlling the Global Marketing Effort PowerPoint By Kristopher Blanchard North Central University

© 2005 Prentice Hall16-2 Leadership Leadership is not about hierarchy or title or status: It is about having influence and mastering change. Leadership is not about bragging rights or battles or even the accumulation of wealth; it’s about connecting and engaging at multiple levels. ….Leaders can no longer view strategy and execution as abstract concepts, but must realize that both elements are ultimately about people.” - Carly Fiorina

© 2005 Prentice Hall16-3 Leadership The leader’s task is to articulate –Beliefs –Values –Policies –Intended geographical scope of activities

© 2005 Prentice Hall16-4 Top Management Nationality “Companies are realizing that they have a portfolio of human resources worldwide, that their brightest technical person might come from Germany, or their best financial manager from England. They are starting to tap their worldwide human resources. And as they do, it will not be surprising to see non-Americans rise to the top.” - Christopher Bartlett, Harvard Business School

© 2005 Prentice Hall16-5 Top Management Nationality

© 2005 Prentice Hall16-6 Leadership and Core Competence Executives were judged on their ability to identify, nurture, and exploit the organization’s core competencies in the 1990’s Core competencies must –Provide potential access to a wide variety of markets –Make a significant contribution to the perceived customer benefits –Be difficult to imitate

© 2005 Prentice Hall16-7 Organization The goal is to find a structure that: –Enables the company to respond to relevant market environment differences –Ensures the diffusion of corporate knowledge and experience throughout the entire system Organization’s must balance: –The value of centralized knowledge and control –The need for individualized response to local markets

© 2005 Prentice Hall16-8 Organization In global marketing there is not a single best structure Leading-edge global competitors share one key organizational design characteristic: –Structure is flat and simple In the 21 st century corporations will have to find new, more creative ways to organize –Must be flexible, efficient, and responsive to meet the demands of globalizing markets

© 2005 Prentice Hall16-9 Patterns of International Organizational Development Organizations vary in: –Size –Potential of targeted global markets –Local management competence Conflicting pressures may arise –For product and technical knowledge –Functional area expertise –Area and country knowledge

© 2005 Prentice Hall16-10 International Division Structure

© 2005 Prentice Hall16-11 International Division Structure Four factors that lead to this structure –Top management’s commitment to global operations has increased enough to justify the position –Complexity of international operations requires a single organizational unity –The firm has recognized the need for internal specialists to deal with the demands of global operations –Management recognizes the importance of proactively scanning the global horizon for opportunities and threats

© 2005 Prentice Hall16-12 Regional Management Centers

© 2005 Prentice Hall16-13 Geographical and Product Division Structures

© 2005 Prentice Hall16-14 The Matrix Design Product or business, function, area, and customer know-how are simultaneously focused on the organization’s worldwide marketing objectives Management must achieve organizational balance that brings together different perspectives and skills to accomplish organizational objectives

© 2005 Prentice Hall16-15 The Matrix Design Geographic knowledge – understanding of economic, social, political, and governmental market and competitive dimensions Product knowledge and know-how – Product managers that have a worldwide responsibility can achieve new levels of product competency

© 2005 Prentice Hall16-16 The Matrix Design Functional competence – corporate staff with worldwide responsibility contributes toward the development of functional competence on a global basis Knowledge of customer or industry and its needs – staff with responsibility for serving industries on a global basis assist organizations in their efforts to penetrate specific customer markets

© 2005 Prentice Hall16-17 The Matrix Design

© 2005 Prentice Hall16-18 Lean Production: Organizing the Japanese Way Compares craft production, mass production, and lean production –Craft production meant one worker created one product –Mass production gained advantages because one worker could do far more specialized work do to the moving assembly line –Lean production uses less factory space, smaller inventories, and quality control methods, increased efficiency by 50% over typical mass production

© 2005 Prentice Hall16-19 Global Management Control Control is defined as the process by which managers ensure that resources are used effectively and efficiently in the accomplishment of organizational objectives Planning process can be divided into two phases –Strategic planning is selection of product and market opportunities –Operational planning is the process in which strategic product or market objectives are translated into specific projects and programs

© 2005 Prentice Hall16-20 Global Management Control

© 2005 Prentice Hall16-21 Formal Control Methods Planning –Determines desired sales and profit objectives and projected marketing program expenditures in unit and money terms Budgeting –Expresses the objectives and expenditures of planning in a formal document

© 2005 Prentice Hall16-22 Influences on Marketing Budgets Market Potential – how large is the potential market Competition – what is the level of competition in the market Impact of Substitute Products – are there substitute products available in the market Process – how are performance objectives determined

© 2005 Prentice Hall16-23 The Global Marketing Audit A comprehensive, systematic examination of the marketing environment and company objectives, strategies, programs, policies, and activities –Tool for evaluating and improving company or business unit operations Characteristics: –Formal and systematic –Conducted periodically

© 2005 Prentice Hall16-24 The Global Marketing Audit Internal –Conducted in-house –Provides critical understanding of firm and industry, but may lack objectivity Independent –Conducted by person or firm free of influence from organization being audited –Provides objectivity but may lack industry expertise

© 2005 Prentice Hall16-25 Setting Objectives and Scope of the Audit One of the major tasks is data collection, a detailed plan is needed for –Interviews –Secondary research –Review of internal documents

© 2005 Prentice Hall16-26 Conducting the Audit Meet with company executives and auditor to determine objectives, coverage, depth, data sources, report format, and time period Gather data Prepare and present the report

© 2005 Prentice Hall16-27 Components of a Marketing Audit The marketing environment audit The marketing strategy audit The marketing organization audit The marketing system audit The marketing productivity audit The marketing function audit

© 2005 Prentice Hall16-28 Conclusion Get directly into a job outside your home country or into a multicountry headquarters job in a global company Get company experience in an industry that prepares you for promotion to a job with multicountry responsibility or to an assignment outside your home country

© 2005 Prentice Hall16-29 Looking Ahead Chapter 17 The Digital Revolution and Global Electronic Marketplace