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Chapter planning, organization, and control of global marketing operations. After studying this chapter you will be able to understand: After studying this chapter you will be able to understand: Local market characteristics that affect the advertising and promotion of products, the strengths and weaknesses of sales promotions and public relations in global marketing, when global advertising is most effective; when modified advertising is necessary,...
GLOBAL MARKETING MANAGEMENT Seventh Edition MASAAKI KOTABKE | KRISTIAAN HELSEN Chapter 17 PowerPoint Planning, Organization, and Control of Global Marketing Operations Chapter Overview Global Strategic Marketing Planning Key Criteria in Global Organizational Design Organizational Design Options Organizing for Global Brand Management Life Cycle of Organizational Structures Control of Global Marketing Efforts Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Introduction • The capstone of a company’s global marketing activities will be its marketing plan • To implement its global plans effectively, a company needs to reflect on the best organizational setup that enables it to successfully meet the threats and opportunities posed by the global marketing arena Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Introduction • Global marketers must confront organizational issues such as: • What is the proper communication and reporting structure? • Who within our organization should bear responsibility for each of the functions that need to be carried out? • How can we as an organization leverage the competencies and skills of our individual subsidiaries? • Where should decision-making authority belong for the various areas? Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Global Strategic Marketing Planning • The content of a global strategic marketing plan usually covers four areas: Market situation analysis Objectives and targets Strategies Action plans • Bottom-Up versus Top-Down Strategic Planning Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Global Strategic Marketing Planning • Pitfalls Marketing plans can go wrong! The top stumbling blocks are: Lack of information of the right kind Too few courses of action; too little discussion of alternatives Unrealistic objectives Failure to separate short/long term plans Lack of framework to identify strengths/weaknesses Too many numbers Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Global Strategic Marketing Planning Lack of framework to define marketplace threats and opportunities Senior management de-emphasizing or forgetful about strategic/long-range plans Too little cooperation between headquarters/subsidiaries or among subsidiaries 10 Too much information of the “wrong kind” 11 Too much planning jargon Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Key Criteria in Global Organizational Design • Environmental Factors – – – – Competitive Environment Rate of Environmental Change Regional Trading Blocs Nature of Customers Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Key Criteria in Global Organizational Design • Firm-Specific Factors – – – – Strategic Importance of International Business Product Diversity Company Heritage Skills and Resources within the Company Chapter 17 Copyright © 2017 John Wiley & Sons, Inc Organizational Design Options • International Division Structure • Global Product Division Structure (See Exhibit 17-1.) Chapter 17 Copyright © 2013 John Wiley & Sons, Inc 10 Exhibit 17-2: Heinz Company: Example of a Geographic Structure Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 13 Exhibit 17-3: Job Description of Japan Country Manager at Twitter Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 14 Organizational Design Options – Regional Structures A survey done in the Asia-Pacific region singles out five distinct roles for regional headquarters (RHQs): • • • • • Scouting Strategic stimulation Signaling commitment Coordination Pooling resources • Matrix Structure (Exhibit 17-4) – The matrix structure explicitly recognizes the multidimensional nature of global strategic decision making – With a matrix organization, two dimensions are integrated into the organization Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 15 Exhibit 17-4: Nestlé’s Organizational Setup Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 16 Organizational Design Options • The Global Network Solution – The networked global organization is sometimes also referred to as a transnational Examples: Asea-Brown Boveri (ABB), Toyota – In the network model, each national unit can be viewed as a source of ideas, skills, capabilities, and knowledge that can be harnessed for the benefit of the total organization (See Exhibit 17-5.) Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 17 Exhibit 17-5: Guidelines on Global Virtual Teamwork Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 18 Organizing for Global Brand Management • Global Branding Committee – Usually made up of top-line executives from corporate (or regional) headquarters and local subsidiaries • Brand Champion – A brand champion is a top-line executive (sometimes a CEO) Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 19 Organizing for Global Brand Management • Global Brand Manager To the global brand manager to be effective: – The top of the organization is committed to branding – There is a solid strategic planning process in place – There is a need to travel to learn about local management and best practices – There is a system to identify, mentor, and train prospects who can fill the role • Informal, Ad-hoc Branding Meetings Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 20 Life Cycle of Organization Structures • Companies need to adapt organizations – existing structures too rigid or complex – environmental changes – managers learn new skills or new senior management is brought in – rethinking organizational structure – pursuit of new strategic opportunities or directions • Successful restructuring takes time, planning, and resources • Fundamental cultural change often needed Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 21 Life Cycle of Organization Structures • Several management theorists attempted to devise the “right” fit between the MNC’s environment (internal and external) and the organizational setup • An in-depth study showed that the key challenge for MNCs is building and sustaining the right management process instead of looking for the proper organizational structure • Country and regional managers must look at strategic issues from multiple perspectives—a “glocal” mindset Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 22 Exhibit 17-6: Stopford-Wells International Structural Stages Model Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 23 Control of Global Marketing Efforts • Formal (“Bureaucratic”) Control Systems – Establishing Standards (Metrics) • Behavior- and outcome-based – Measuring and Evaluating Performance – Analyzing and Correcting Deviations Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 24 Control of Global Marketing Efforts • Informal Control Methods – Corporate Culture: • Clan-based cultures and market-based cultures – To shape a shared vision, cultural values should have three properties: • Clarity • Continuity • Consistency – Human Resource Development Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 25 Control of Global Marketing Efforts • “Soft” versus “Hard” Levers There are seven management tools or “levers” that companies can use to resolve the global/local tradeoffs: Chapter 17 Organizational structure Process Incentives Metrics Strategy Networks Culture Copyright © 2017 John Wiley & Sons, Inc 26 Control of Global Marketing Efforts • Advice for Strategic Coherence – – – – Recognize the need for business asymmetry Adopt a bottom-up approach Importance of a shared vision Invest heavily in horizontal communication channels and information flows – Ensure that somebody has a global overview of each product line or brand – Need for a good mix of specialists of three types— country, functional, and business – Moving unit headquarters abroad seldom solves the organization’s problems Chapter 17 Copyright © 2017 John Wiley & Sons, Inc 27 ... Exhibit 1 7- 5.) Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 17 Exhibit 1 7- 5: Guidelines on Global Virtual Teamwork Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 18 Organizing for Global. .. mindset Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 22 Exhibit 1 7- 6: Stopford-Wells International Structural Stages Model Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 23 Control of Global. .. organization Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 15 Exhibit 1 7- 4: Nestlé’s Organizational Setup Chapter 17 Copyright © 2 017 John Wiley & Sons, Inc 16 Organizational Design Options • The Global