Organizing for maximum effectiveness

Achieving the optimum marketing organization is a difficult task. Many approaches have been tried, and each has its advantages and disadvantages. Understanding the capabilities of the individuals in your firm will go a long way to improving the results, but designing the proper structure is a key way to empower individuals to do their best. The most important points from this chapter are as follows. Organization ranges from the simple functional structure – where all similar functions, such as market research, advertising, or distribution, are gathered together – to the complex matrix or organismic organization structure where lines of authority are blurred. The trade-off in organization design is usually simplicity versus a proper level of concentration on product or market segment. Many combinations of organization are possible, and managers tend to develop their organization in an incremental way to satisfy an overall idea of the most effective organization form. The needs of a global firm add another layer of complexity to the organization. A major challenge in global organizations is the need for centralization versus decentralization of marketing functions. Decisions about the most effective organization are based upon a number of internal and external factors. The best organization structures probably have these characteristics: simplicity, easy exchange of information, and putting the best people closest to the customers. The debate about product or market managers has evolved into the “customer-focused organization” where market segment-oriented organizations take precedence over product organizations. For fast-moving markets, major reorganizations have been replaced by “patching,” where small changes are made quickly to meet the needs of a rapidly changing market. It is often more effective to leave the structure the way it is and move individuals into positions where they can succeed.