Academic journal article Management Dynamics

Strategic Drivers of a Network-Orientated Approach to the Organisation of Marketing in Business-to-Business Firms

Academic journal article Management Dynamics

Strategic Drivers of a Network-Orientated Approach to the Organisation of Marketing in Business-to-Business Firms

Article excerpt

INTRODUCTION

Research investigating the marketing structure of organisations - particularly business-to-business organisations - has been relatively scarce (Espinosa and Lindahl, 2016; Artto, Valtakoski and Kärki, 2015; Krohmer, Homburg and Workman, 2002). Olson, Slater and Hult (2005) posit that the marketing organisation's structural characteristics complement business strategies. The pressure on marketing to be more accountable for the marketing investments made and the returns generated, together with increasing market pressures, makes it increasingly important to understand how the marketing function can be organised to address these often conflicting demands. Traditional marketing structures are characterised by a high degree of centralisation, with marketing characterised as a functional group (Albers, Wohlgezogen and Zajac, 2016; Guadalupe, Li and Wulf, 2014). With the ever-changing competitive landscape, the need arises to move away from hierarchical, centralised structures to flatter, decentralised structures. The driving force of this shift comes (at least in part) from the emergence of business-to-business networks, where organisational structures need to facilitate multiple levels of interaction that cross traditional functional boundaries (Wilkinson, 2001).

This study investigates two important drivers of a networkfriendly approach to organising marketing activity, by attempting to answer three questions: (a) What is the relationship between the desire to meet market demands (market responsiveness) and a perceived network orientation to organising marketing? (b) What is the relationship between collaboration (across organisational boundaries) and a network orientation to organising the marketing function? (c) How are the two relationships in (a) and (b) mediated by the cross-functional coordination of business activities?

In the literature review that follows, the theoretical background to market responsiveness, collaboration, and cross-functional coordination are considered, in order to construct a theoretical model for empirical testing. The results of a cross-sectional study among South African business-to-business firms are then reported, and the study concludes with the limitations and some suggestions for future research.

THE ORGANISATION OF MARKETING

The organisation of marketing deals with the way marketing is arranged to integrate an organisation's customer-facing processes. Over the years, marketing departments have evolved from being characterised by traditional hierarchical, bureaucratic marketing structures (Strese, Meuer, Flatten and Brettel, 2016; Dosi and Marengo, 2015) to being characterised by a decentralisation, devolution and dispersion of the marketing activity (Wu, 2015; Harris and Ogbonna, 2003). Earlier work on organisational structure appears rather descriptive (Homburg et al., 2000); it focused on the extent to which organisations had adopted or implemented the marketing concept, and considered the type of organisational structures used. It also focused on the product manager and on efforts to understand and explain the extent, involvement and responsibility of marketing groups for various marketing activities (Homburg et al., 2000). In the 1990s, scholarly focus shifted beyond the boundaries of the organisation to consider the organisation and structuring of activities in inter-organisational networks (Favre-Bonté, Gardet and Thevenard-Puthod, 2016). It follows that the formalised central marketing department and the structuring of the marketing function has come under scrutiny, with the growth of the industrial service sector and the increased focus on developing long-term relationships in inter-organisational market settings (Angus and Lorna, 2000). The centralised marketing department - as a tangible expression of the marketing function - is seemingly losing support in the organisation of some modern-day firms (Wu, 2015; Mu, 2015; Chakravarty, Kumar and Grewal, 2014; Claver-Cortés et al. …

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