Transcript An Integrated View of IGMC Management

An Integrated View of
IGMC Management
Sunarto Prayitno
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Introduction
Traditionally management of the marketing
communication area, either a marketing communication
manager or perhaps an advertising director.
In some cases it might be the sales manager or director
who adds communication responsibilities to his or her
portfolio.
Thus communication has been managed as
organizational activity or element based on functional
objectives.
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Introduction
The goals of the communication unit are typically set by
senior managers who are often responsible for broad
areas of the organization.
Likewise, senior management has determined
communication budgets either based on requests by the
functional manager or simply as allocations made during
the annual budgeting cycle.
Commonly funds dedicated to marketing and
communication have come from the general resources
available within organization or, increasingly, have been
allocated into a common pool by the various strategic
business units (SBUs) as part of their budgeting process.
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Introduction
In marketing communication program development and
support, the marketing communication manager relied
on either an internal department, commonly staffed by
media, creative, or visual specialists, or and external
organization such as an advertising agency or
communication development and placement
organization.
Compensation of the external groups was often based
on some type of media commission for space or time
purchased, markups on purchased supplies or materials,
perhaps fees for time invested in the development of
plans and programs.
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Introduction
In both managing and financing various marketing
communications program, the amount spent by the
marketing organization was taken as a fixed expense by
the firm.
That is, it was budgeted at the beginning of the
accounting period, and withdrawals were made from a
reserve set up for the purpose as the program were
executed.
Thus the senior management assumed marketing and
communication expenditures were a sunk cost or an
accrual account that could be “raided” near the end of
the accounting period if expenses needed to be reduced
or funds moved to shore up the bottom line.
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Introduction
Therefore, marketing communication in most
organizations has deserved little or no top
management attention since:
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it was difficult to measure results,
it expensed costs, and
Little or no immediate business impact was felts as a result
of adjusting the level of investment.
Thus, while marketing communication has been
important to the person involved in the function,
unfortunately, the same cannot be said for senior
management in many firms.
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Introduction
Thus the systems used to manage the marketing
communication function and to determine how
and in what amount communication program
development should be founded or measured
have received little attention outside the
immediate areas of the functional activity.
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A Traditional Approach to MC
Management
For the most part marketing communication has been
designed as a function or a department or an area
activity in most organizations. Thus it has come under
the traditional approaches of command and control
management.
There are generally three or more basic activities of the
organization – operations, finance, and
sales/marketing. Under each activity a number of
groups deal with the specific area related to the function.
Operations control manufacturing or development and
distribution. Finance deals with accounting, billing, and
payroll. Marketing deals with customer contact, market
planning, product management, and so on.
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A Traditional Approach to MC
Management
The Typical
Corporate
Organization
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A Traditional Approach to MC
Management
It is clear from this organizational structure that there can
be little or no integration within the total organization.
Each functional element is separate and has its own
areas and activities for which it is responsible, and each
is managed and rewarded on what it does, not what it
accomplishes.
From the view of the functional manager, he or she is
separate and unique activity unrelated to the whole of
the organizations.
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A Traditional Approach to MC
Management
The IGMC approach to marketing communication
management takes exactly the opposite track from
traditional management thinking: “We start with a
customer view of the organization and work back.”
That develops management approaches that fits
customer needs, rather than organization structures and
flowcharts that fits managerial goals.
Along the way, of course, we must bring the customer
needs and organizational structure and capability
together, but the concept of customer-centric
organization is key to our approaches.
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What Needs to Be Managed?
If the organization takes an inside-out approaches, the
management and the communication function will equate
to managing the communication output of the firm.
Management will be focused on managing the
advertising program or the sales promotion activities or
direct marketing mail drops or public relations events.
Thus the communication people and managers will be
focused on what gets done, not on the impact of the
programs the group is implementing.
Focusing on the outcomes rather than the output,
again is a major difference in how the marketing
communication group views itself and its responsibilities.
It is the IGMC approach.
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What Needs to Be Managed?
The real task for the marketing communication group
and the marketing communication manager is not the
management of the communication delivery vehicles
but:
1. How to attract and acquire new customers for the
organization, or
2. How to retain desirable present customers, and/or
3. How to manage acquired and retained customers
through the product portfolio of the organization.
Each of these tasks is unique, and each requires a
different set of marketing and communication skills,
tools, and tactics.
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What Needs to Be Managed?
From a marketing communication management
standpoint, the first issue for the IGMC manager is “How
can I best invest the finite resources of the organization
in marketing communication to attract new customers?”
Then, once a prospect has been attracted and retained,
the next question is “How can I manage the new
customer through our product portfolio so it will provide
benefit to the customer and to the firm?”
That, of course, demand totally different from and type of
communication program from the one used initially to
attract customers to the brand.
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What Needs to Be Managed?
Finally, the management issue of the marketing
communication manager and group become “How can
we assist in retaining the customers we have attracted
and are migrating through our product or services
assortment so that they remain with us overtime?”
Again, retention demands a different type of
communication program from acquisition or migration,
and it demands a different type of approaches and
communication mix.
In some cases advertising may be very important; in
others, it may not be used at all. The approach of
managing customers and customer communication
requirements is vastly superior to the management
traditional communication delivery vehicles.
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What Needs to Be Managed?
Customer
Management
Structure
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What Type of Management
Structure?
While the organizational structure of many
IGMC organizations is still developing, we
have identified three forms that appear to have
possibilities for the present and future:
1. A Revised Brand Management Structure
2. Centralized Marketing Communication
Activities
3. The Market Segment Design
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What Type of Management
Structure?
1. A Revised Brand Management Structure:
This structure illustrates one way of moving toward being
a customer-focus organization. Rather than being
focused on products or brands, the organization is
focused on customers and market segments.
Further, another group is responsible for the various
market segments that have been identified: for example,
heavy or light users or present customers and prospects
and the like.
Yet another group focuses on new or special products –
managers who identify new market segment or who
identify new products that can be developed for existing
customers.
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What Type of Management
Structure?
There are also to support groups in this design:
1. Marketing services – the support group that
provides expertise in the marketing
communication areas.
2. Sales – the face-to-face contacts that occur with
customers and prospects.
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What Type of Management
Structure?
Market-Focused
Organization
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What Type of Management
Structure?
2. Centralized Marketing Communication Activities:
Another way to become customer focused is to control
all marketing or brand communication through a central
office or marketing communication manager.
This approaches is being used increasingly by
organizations that are attempting to move from sales
oriented to a marketing- or brand-oriented approaches to
marketing and communication.
Often called the corporate communication director, this
manager is designed to consolidate control and
responsibility for all forms and types of corporate and
product brand communication in one place, increasingly
in the office of the CEO or chairman of the organization.
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What Type of Management
Structure?
Marketing
Communication
Management Structure
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What Type of Management
Structure?
3. The Market Segment Design:
The market segment design is based on the concept of
being totally customer oriented and developing and
delivering services to satisfy customer needs through
focused approach.
The primary value of the market team design is that it is
in line with the increasing focus on teams and work
groups within many organization – the famous “flat
organization”.
In the team approach the traditional hierarchy is
abandoned in favor of group of specialists who come
together for long or short periods of time to attack
specific problems or opportunities.
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What Type of Management
Structure?
In the structure illustrate a unique team of functional
specialists comes together to manage a group of
customers.
Almost all activities required to provide products and
services to a group of identified customers or prospects
are represented within the team.
Granted, the team may need to draw on production and
distribution activities from the central organization, yet it
contains the resources needed to acquire, manage
through the product or service portfolio, and retain a
group of customers either locally or around the world.
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What Type of Management
Structure?
Market Team
Structure
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What Type of Management
Structure?
In our view this market team design is the most
appropriate for a global marketing organization.
The market team is focused on the customer wherever
the customers or prospects might be located.
The goals is to manage the customer, not the geography
or the products or services.
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What Type of Management
Structure?
Understanding the marketing communication process:
Eight steps are involved in developing and delivering a
marketing communication program.
While some of the activities may blend across the
various boxes we illustrate, these are generally the
activities involved.
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Understanding the MC Process
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Understanding the MC Process
1. Information or Data Gathering:
This is the process of gathering information, knowledge,
and records about customers and prospects, markets,
and marketing systems in the marketplace to be served.
Commonly this is done by research organizations or
perhaps database organizations.
In some cases it falls to an internal information
technology group.
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Understanding the MC Process
2. Data Consolidation and Analysis:
These are firms or people who take the raw data
gathered in the first step and consolidate or bring the
data together to examine what customers are doing in
the marketplace.
Commonly these are organizations that compile data
and provide it to organization for analysis or make data
interpretation.
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Understanding the MC Process
3. Market Analysis to Develop Market Understanding:
These firms take the gathered and consolidated
information on markets and customers and analyze and
attempt to understand how the market operates, how
customers buy, how product are used, an so on.
A few advertising agencies still operates in this area, but
increasingly those activities are being outsourced to
external groups.
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Understanding the MC Process
4. Market Strategy Development:
Traditionally this has been the province of the marketing
organization and the brands or product manager.
Increasingly, however, consulting organizations and
market research and database firms are entering this
field.
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Understanding the MC Process
5. Message or Incentive Development:
Historically the advertising agencies have provide this
services. Agencies took the strategy the organization
developed and turned it into messages and or incentives
ready to be distributed.
Increasingly the advertising agencies are turning into
holding companies with operating units in all the specific
marketing and communication activities ranging from
advertising to public relations to sales promotion.
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Understanding the MC Process
6. Message or Incentive Production:
Again, this has historically been the province of the
advertising, promotion, or communication agency.
While those agencies have often employed specific
production organizations such as television producers,
type and film houses, and the like, the agency has
operated as the consolidator or those services and
presented a unified package to the client organization.
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Understanding the MC Process
7. Message or Incentive Distribution:
Distribution of marketing messages and incentives
usually occurs through various forms of media
organizations ranging from newspapers to television to
cinema to direct mail.
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Understanding the MC Process
8. Message or Incentives Response Analysis:
Measurement of the effect and results of marketing
communication programs has not been well developed in
any specific market and certainly not in global term. For
the most part measurement has focused on the
marketing communication output.
Increasingly the area of marketing communication
measurement is being developed by specialized
consulting organizations that are focused on developing
this area.
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