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From Silos to Synergy—Harnessing the Organization
Chapter Fifteen
Copyright © 2010 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that permitted in Section 117 of the 1976 United States Copyright Act without the express written permission of the copyright owner is unlawful. Requests for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information contained herein.
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USCopiers Sales Advertising
Sponsorship Digital
Functional Silos
France
MedicalImaging
Projectors
HDTV
Far East Africa
Product Silos Country Silos
The Silo World
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Silo-Driven Problems
Misallocation of marketing resources
Silo-spanning brandslack clarity & linkage
Silo-spanning offerings & programs are missed or mishandled
Marketing management competence is diffused
Success is not leveraged across silos
Communication and cooperation weak
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A Framework for Analyzing Organizations
Figure 15.2
People Structure
Systems Culture
People Structure
Systems Culture
External AnalysisExternal Analysis
StrategyStrategy
Internal AnalysisInternal Analysis
PerformancePerformance
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Obtaining Information about Organizational Components
Structure
• What is the organization’s structure? How decentralized is it?
• What are the lines of authority and communication?
• What are the roles of task forces, committees, organizations, or similar mechanisms?
Figure 15.3
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Obtaining Information about Organizational Components
Systems• How are budgets set?• What is the nature of the planning system?• What are the key measures used to evaluate
performance?• How does the accounting system work?• How do product and information flow?
Figure 15.3
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Obtaining Information about Organizational Components
People• What are the skills, knowledge, and experience of the
firm’s employees?• What is their depth and quality?• What are the employees’ expectations?• What are their attitudes toward the firm and their jobs?
Figure 15.3
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SharedValuesSharedValues
Norms of BehaviorNorms of Behavior
Symbols andSymbolic Action
Symbols andSymbolic Action
Organizational Culture
Figure 15.3
OrganizationalCulture
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Chapter 15 - Organizational Issues PPT 15-9
Obtaining Information about Organizational Components
Culture• Are there shared values that are visible and accepted?• What are these shared values and how are they
communicated?• What are the norms of behavior?• What are the significant symbols and symbolic activities?• What is the dominant management style?• How is conflict resolved?
Figure 15.3
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Silo Spanning Objectives
Dysfunctional objectives
Centralize Standardize Reduce the number of
divisions or agencies
Appropriate objectives— to improve
Silo-spanningprograms & offerings
Brand consistency & linkage Resource allocation Marketing competence Communication & cooperation
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The CMO—On Getting Traction
• Get the CEO on Board• Get the right people• Cross-silo teams• Get easy wins• Be facilitator/consultant• Engage the business units• Deliver excellence• Balance central opportunities with local needs
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Overview of Strategic Market Management
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A Business StrategyA Business Strategy
Where to CompeteThe product-market investment decision
How to CompeteValue Assets & Function area
proposition competencies strategies and programs
A Business Strategy
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Overview of Strategic Market Management
External Analysis• Customer Analysis• Competitor Analysis• Market/submarket Analysis• Environmental Analysis
Internal Analysis• Performance Analysis• Determinants of strategic options
Strategic Analysis OutputsStrategic Analysis Outputs
Strategy Identification, Selection, and Implementation
Strategy Identification, Selection, and Implementation
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Strategy Development: A Discussion Agenda
Customer Analysis Who are the major segments? What are their motivations and unmet needs?
Figure 15.5
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Strategy Development:A Discussion Agenda
Competitor Analysis Who are the existing and potential competitors? What strategic groups can be identified? What are their sales, share, and profits? What are the growth trends? What are their strengths, weaknesses, and strategies?
Figure 15.5
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Market Analysis How attractive is the market or industry and its submarkets? What are the forces reducing profitability in the market,
entry and exist barriers, growth projections, coststructures, and profitability prospects?
What are the alternative distribution channels
and their relative strengths? What industry trends are significant to strategy? What are the current and future key success factors?
Strategy Development:A Discussion Agenda
Figure 15.5
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Chapter 15 - Organizational Issues PPT 15-18
Strategy Development:A Discussion Agenda
Environmental Analysis What environmental threats, opportunities,
and trends exist? What are the major strategic uncertainties
and information need areas? What scenarios can be conceived?
Figure 15.5
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Strategy Development:A Discussion Agenda
Internal Analysis What are our costs, strategy, performance, points of
differentiation, strengths, weaknesses, strategic problemsand culture?
What is our existing business portfolio? What has been our level of investment in our various
product markets?
Figure 15.5
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Strategy Development:A Discussion Agenda
Strategy Development• Product market investment—exit, milk, maintain,
grow/enter What assets and competencies will provide the basis for
an SCA? How can they be developed and maintained? How can they be leveraged?
Figure 15.5
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Strategy Development:A Discussion Agenda
Strategy Development• Product market investment—exit, milk, maintain,
grow/enter What assets and competencies? How can they be
developed, maintained, leveraged? What value proposition? What functional strategies?
Figure 15.5
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Strategy Development:A Discussion Agenda
Customer Analysis Who are the major segments? What are their motivations and unmet needs?
Figure 16.5
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Strategy Development:A Discussion Agenda
Customer Analysis Who are the major segments? What are their motivations and unmet needs?
Figure 16.5
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Strategy Development:A Discussion Agenda
Competitor Analysis Who are the existing and potential competitors? What strategic groups can be identified? What are their sales, share, and profits? What are the growth trends? What are their strengths, weaknesses, and strategies?
Figure 16.5
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Market Analysis How attractive is the market or industry and its submarkets? What are the forces reducing profitability in the market,
entry and exist barriers, growth projections, cost structures, and profitability prospects?
What are the alternative distribution channelsand their relative strengths?
What industry trends are significant to strategy? What are the current and future key success factors?
Strategy Development:A Discussion Agenda
Figure 16.5
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Strategy Development:A Discussion Agenda
Environmental Analysis What environmental threats, opportunities,
and trends exist? What are the major strategic uncertainties
and information need areas? What scenarios can be conceived?
Figure 16.5
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Strategy Development:A Discussion Agenda
Internal Analysis What are our costs, strategy, performance, points of
differentiation, strengths, weaknesses, strategic problemsand culture?
What is our existing business portfolio? What has been our level of investment in our various
product markets?
Figure 16.5
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Strategy Development:A Discussion Agenda
Strategy Development
• Product market investment—exit, milk, maintain, grow/enter
What assets and competencies will provide the basis for an SCA? How can they be developed and maintained? How can they be leveraged?
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Strategy Development:A Discussion Agenda
Strategy Development
• Product market investment—exit, milk, maintain, grow/enter
What assets and competencies? How can they be developed, maintained, leveraged?
What value proposition? What functional strategies?
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Growth Strategies
• Energize the business
• Leverage the business
• Enter new business product/markets
• Go Global
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Why Strategic Market Management?
• Precipitate the consideration of strategic choices.
• Help a business cope with change.
• Force a long-range view.
• Make visible the resource allocation decision.
• Aid strategic analysis and decision making.
• Provide a strategic management and control system.
• Provide both horizontal and vertical communication and coordination systems.
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Key Learnings
• The organizational levers are structure, systems, people, and culture. Each must be congruent and support the business strategy.
• Decentralization with powerful silo groups can inhibit synergy and efficiency. For marketing, it leads to misallocation of resources, confused brands, inhibited cross-silo offerings and programs, weak marketing staffs, the failure to leverage success, and inadequate cooperation and communication.
• In dealing with the problem CMOs should consider nonthreatening roles such as facilitator or consultant and should do not have as an objective to centralize and standardize.
• The organizational structure lever provides the option to centralize selectivity, use teams and networks, use matrix reporting structures, and to employ a virtual organization.
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Key Learnings
• Management systems involves the information, measurement and reward, and planning systems that can all promote cooperation and communication.
• People on the CMO team, who can be sources internally or externally, need to be knowledgeable and marketing, brands, markets, products, and the organization in addition to being strategic and serving as change agents.
• Culture involves shared values, norms of behavior and symbols and symbolic action. The CEO is a key drive of strategy and it is important to get him or her on board. The fit between components is illustrated by the hit-industry topology, which contrasts the functions of drillers (who develop products), pumpers (who focus on production), and distributors (who specialize in marketing and distribution).
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Ancillary Slides
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Chapter 15 - Organizational Issues PPT 15-35
“All progress is initiated by challenging current conceptions and executed by
supplanting existing institutions.”
- George Bernard Shaw
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“Structure follows strategy.”
- Alfred Chandler, Jr.
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“Those that implement the plans must make the plans.”
- Patrick Hagerty,Texas Instruments
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“There is nothing more requisite in business than dispatch.”
- John Addison
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“This report, by its very length, defends itself against the risk of being
read.”
- Winston Churchill
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“If I had to sum up in one word what makes a good manager, I’d say
decisiveness. You can use the fanciest computers to gather the numbers, but in the end you have to set a timetable
and act.”
- Lee Iacocca