Download 10 piercy fourth ed

Implementation processes and
internal marketing: Making it happen
Lecture 11
A route-map for
market-led strategic change
Part I
Customer value
imperatives
Part II
Developing a value-based
marketing strategy
The strategic pathway
Market sensing
and learning
strategy
The Customer
is always
right-handed
New
marketing
meets
old marketing
Value-based
marketing
strategy
Strategic
thinking and
thinking
strategically
Strategic
market choices
and targets
Customer value
strategy and
positioning
Strategic
relationships
and networks
Part III
Processes for managing
strategic transformation
Change strategy
Strategic
gaps
Organization
and processes
for change
Implementation
process and
internal
marketing
Agenda - 1
• Why do we need to make an issue out of strategy
implementation?
• Implementation versus strategy
• So, what is the thing about implementation?
• Implementation denial
• So, why doesn’t it work?
• Building implementation strategies
Agenda - 2
• Strategic internal marketing
• Where does that leave us with strategy implementation?
Why do we need to make an issue
out of strategy implementation?
• Many company change initiatives fail
• Implementation capabilities
• The need for internal marketing
– getting employees on our side
– getting managers on our side
– getting collaborators on our side
– changing culture
How groups can block
effective change in a company
Energy
High
Low
High
The
“yes … but”s
or malicious
obedience
The
ideal
The
dinosaurs
The
dangerous
enthusiasts
Understanding
Low
Implementation versus strategy
• Traditional approaches: organization, resources action
lists, control systems
• Creates a dichotomy between strategy formulation and
implementation
• Need better ways of integrating strategy and
implementation
So, what is the thing about
implementation?
• Implementation failures associated with
– separation of planning from management
– hopeless optimism
– implementation recognized too late
– denial of implementation problems
– implementation bolted-on at the end
– fixation
– implementation is a black-box
Implementation denial
• Failure to recognize the implementation problem
• Need to recognize problems and prepare for change
Recognising the implementation
problem and preparing for change
Perception that there is a problem
High
Low
Ready
to go
Blissful
ignorance
Worried stayers/
frightened
rabbits
Closed
minds
High
Willingness
to change
Low
So, why doesn’t it work?
• Strategy versus implementation skills
– diagnosing implementation problems means
comparing strategy (appropriate or inappropriate) with
execution skills good or bad)
Diagnosing the
implementation problem
Strategy
Good
Appropriate
Inappropriate
Success
Roulette
Trouble
Failure
Execution
skills
Bad
So, why doesn’t it work?
• Organizational stretch
– what is the relationship between the fit of the strategy
with company capabilities, systems and structures
and the strategy itself (new or old)?
Matching strategy to
company capabilities
Fit of strategy with company
capabilities, systems, structures
New
Good
Poor
Synergistic
strategies
Stretch
strategies
Conventional
strategies
Obsolete
strategies
Market
strategy
Old
So, why doesn’t it work?
• Testing out the strategy versus blaming the salesperson
• Lip-service to strategy caused by
– management by assumption
– structural contradictions
– empty promises marketing
– bunny marketing
• Counter-implementation emerges
Testing market strategies
Test the strategy
Is this really a coherent
and complete strategy?
No
Results
Reason
No
implementation
This strategy does
not tell us what to do
No
implementation
Lip-service - we may
agree with the strategy
but we cannot put it
into effect
No
implementation
We do not accept this
strategy - let’s see what
counter-implementation
can do!
Yes
Is this strategy capable of
being implemented by this
company at this time?
No
Yes
Have we communicated the
strategy - adapted it, won
support for it?
Yes
No
Implementation
(maybe)
So, why doesn’t it work?
• What about execution skills and competences?
– interacting skills
– allocating skills
– monitoring skills
– organizing skills
Building implementation strategies
•
•
•
•
Screen strategies for implementation problems
Isolate and evaluate priority implementation problems
Evaluate key players in implementation
Develop implementation strategies
Screening strategies for
implementation problems
1. Screen strategies for implementation problems early
2. Isolate and evaluate implementation problems in detail
3. Identify and evaluate key players
4. Develop credible, costed implementation strategies
- or reject the strategy
Internal and external
marketing
Strategy
Plan
Internal
Targeted at key
marketing
groups in the
programme
company, alliance
Product
partner companies,
Price
and other influencers Communications
Distribution
External
marketing
programme
Product
Price
Communications
Distribution
Targeted at key
customers, segments
and niches, and other
external influencers
Role of
Internal Marketing
• The managerial actions necessary to make all members
of the organization understand & accept their role in
implementation
– internal products-marketing strategies
– internal prices-changes that must be undertaken to
implement the marketing strategy
– internal distribution-how the strategies are
communicated internally (training)
– internal promotion-persuasive communications
Models of internal marketing
Source: Ahmed and Rafiq (2002) Internal Marketing
Butterworth Heinemann Chapter 2
Berry’s model of
internal marketing
Employee
involvement
and
participation
Treating
employees
as
customers
Jobs
as
products
Application
of marketing
techniques
internally
Employee
satisfaction
Attitudes
towards
service
mindedness
Attraction and
retention of
customer
conscious
employees
Perceived
service
quality
Customer
satisfaction
Competitive
advantage
Gronroos’ model of
internal marketing
Pre-launch
information
regarding
marketing
campaign
Employees
realise the
importance
of their role
Interactive
marketing
Increased
sales
Supportive
recruitment
practices
Supportive
management
Training
Participate
management
Employee
discretion
Motivated
customer
conscious
employees
Employees’
satisfaction
Goal
interaction
Perceived
service
quality
Customer
satisfaction
Increase
profitability
Rafiq and Ahmed meta-model
of internal marketing
Pre-launch information
regarding marketing
campaigns
Supportive
recruitment
practices
Training
Employees realise the
importance of
their role
Participative
management
Employee
discretion
Motivated
employees
Service
quality
strategy
Supportive
senior
management
Customer
conscious/
customer
orientated
employees
Jobs as
products
Application
of marketing
techniques
internally
Sales
minded
employees
Employees’
satisfaction
Attraction and retention
of customer conscious
employees
Good
interaction
Word of mouth
promotion
Perceived
service
quality
Customer
satisfaction
Increased
loyalty
Increased
profitability
Increased sales
due to interactive
marketing
A framework for internal
marketing of services
Inter-functional
Co-ordination
and Integration
Employee
motivation
Marketing-like
approach
Job
satisfaction
Customer
orientation
Service
quality
Customer satisfaction
Empowerment
The tools of internal marketing
Source: Ahmed and Rafig
Caveats
• Employees as customers
– products may be unwanted (e.g. new methods of
working)
– employees must accept the ‘product’ or be forced into
acceptance under the threat of disciplinary action or
dismissal
Caveats
– problem with idea of customer sovereignty
– make impossible demands on organisation and its
resources
• In this approach employees do not know that they are
customers even though they are treated as such
INTERNAL MARKETING MIX
•
•
•
•
Number of elements under the control of management are combined and
integrated in order to produce the required response from the target market.
Use extended seven P’s of service marketing
Explicitly recognises inter-functional interdependence and the need for an
integrated effort for effective service (or product) delivery
Major aim of an internal marketing programme
Levels of internal marketing
Organizational
levels
Surface
Structural
Processual
Critical
questions
What are the plans,
systems and
procedures in
this business?
Who runs things
here?
Who has influence
here - sets the agenda,
owns key processes,
is an “expert”?
Internal
marketing
levels
Product:
Plans and strategies
Price:
Opportunities
given up
Communications:
Information,
market research
Distribution:
Reports,
presentations
Product:
New strategic direction
Price:
Loss of control,
status, initiative
Communications:
Sponsorship,
agenda-setting
Distribution:
Policies,
participation
Product:
individual’s job, status, role
Price:
Adjustment to
change, new culture
Communications:
Persuasion, image,
influence, choice of criteria
Distribution:
informal communications
network,
social interaction
Strategic internal marketing
Programme
Contents
Examples
Product
The strategy and the plan,
including the values, attitudes
and behaviours needed to
make them work
What we are asking internal
customers to “pay” – other
projects abandoned, personal
and psychological adjustment
to change
Media and messages to inform
and persuade
For example, the written plan,
the new company initiative
Physical and social venues for
delivering the product and
communications
For example, meetings, work-groups,
training sessions and workshops,
informal meetings, social occasions
Price
Communications
Distribution
For example, stepping out of
comfort zones for new types
of operations
For example, reports, plans,
presentations, videos,
roadshows
INTERNAL MARKETING MIX
PRODUCT
•
Strategic level refers to marketing strategies
– sell values and attitudes needed to make a plan
•
Tactical level, e.g.
– new performance measures
– new ways of handling customers
•
Refer to services and training courses provided by HRM
INTERNAL MARKETING MIX
•
Fundamental level
– job
– managers need to concentrate on the benefits of the product rather than
its features
– employees perspective and benefits they seek
– consider:
• training needs,
• level of responsibility and involvement in decision making,
• career development opportunities,
• working environment
– facilitate hiring retention and motivation of employees
INTERNAL MARKETING MIX
PRICE
•
Psychological costs of adopting new methods of working
– projects have to be forgone in order to carry out new policies (i.e.
opportunity cost) or to transfer pricing and expense allocation between
departments
– opportunity costs difficult to measure precisely
– employees tend to overestimate costs of undertaking new practices and
are inclined to resist change
•
Benefits of adopting new policies need to be clearly explained and any fears allayed
by providing employees with appropriate information
INTERNAL MARKETING MIX
Internal communication/Promotion
•
•
Need co-ordinated use of various techniques
personal selling
– face-to-face presentations to individuals and groups more effective than
in external marketing
– presenter has implicit authority behind what they are saying
– face-to-face communication regarded has having far greater impact
than other communication methods.
INTERNAL MARKETING MIX
•
Incentives
–
–
–
–
–
•
cash bonuses
awards
recognition programmes
prize draws
competitions
used to overcome short-term resistance or to motivate employees toward consistent
behaviour or to increase productivity.
INTERNAL MARKETING MIX
•
•
Advertising
Companies need to take care of image projecting of themselves and the
workforce in external advertising
– seen be employees as well as customers
– positive when positive customer-orientated attributes portrayed which
employees can attempt to emulate
Narrow casting developments
– Business TV
– Webcasting
INTERNAL MARKETING MIX
•
•
•
Place/distribution
Place and channels (or third parties) that are used to get to customers
place is the locations where policies are announced :
– meetings
– conferences
channels refers to third parties used to deliver training programmes
– consultants and training agencies
INTERNAL MARKETING MIX
Physical/tangible evidence
•
•
•
•
•
Environment in which a product is delivered and where interaction takes place between contact
staff and customers, as well as any tangible goods that facilitate delivery or communication if the
product
Physical evidence
– essential or peripheral (tangible cues that a product has been delivered)
Peripheral evidence e.g. memos, guidelines, training manuals
Essential evidence - environment in which the product is delivered
Special significance of particular policies may be signalled by holding conferences or by sending
employees for special training to external agencies such as universities
INTERNAL MARKETING MIX
•
•
Tangible cues important
Documentation of policies and changes in policies important
– if employees are required to perform to certain standards then it
is important that these standards are fully documented
•
Training sessions
– tangible manifestation of commitment to standards or particular
policies
INTERNAL MARKETING MIX
•
•
•
•
PROCESS
How customer receives a product
customer consciousness may be inculcated into employees by training (or
retraining) staff
Can refer to whether new policies are introduced through negotiations with
unions or imposed unilaterally
Also refers to delivery method e.g.
– circulars, videos or line managers are sued to convey messages
INTERNAL MARKETING MIX
PARTICIPANTS
•
•
•
•
•
People involved in delivering product and those receiving the product who may
influence the customers perceptions
Source of internal marketing programme plays a crucial role in their effectiveness
Inter-departmental or inter-functional communications are likely to be least effective
Most effective means through immediate superior who needs to be motivated by
strategic management.
Direct contact between strategic management and contact staff would not by itself be
sufficient for the implementation of internal marketing programmes.
INTERNAL MARKETING MIX
•
•
Market segmentation
– process of grouping employees with similar characteristics and needs
and wants
– include types of benefits that employees want, and roles and functions
that they perform
– need to be segmented along motivational lines rather than departmental
or other lines traditionally used in HRM
Market research
– identifying needs and wants of employees
– monitoring the impact of HRM policies on employees
– long history in HRM in form of employee attitude surveys.
Implementing
Marketing Activities
• Good communication is key
– upward communication from the front line
– allows management to understand problems & needs
of the employees
• Employees must understand the implementation
timetable
– specific activities to be performed, time required,
sequence, & who is responsible
Implementing an
Internal Marketing Approach
• Conscientious recruitment, selection & training of
employees
• Top managers must be completely committed to the
marketing strategy & overall plan
• Employee compensation must be linked to marketing
strategy implementation
• Open communication must exist at all levels
• Organizational structure, processes & policies must match
the marketing strategy
Strategic internal marketing
• Operational internal marketing
– service marketing and quality
– brand ambassadors
– internal communications
– innovation management
– corporate positioning
– Internal markets instead of external markets
Strategic internal marketing
• Strategic internal marketing
– internal market orientation
– internal marketing strategy
– the structure of SIM
Strategic internal marketing
• The internal marketing programme
– internal market measurement
– internal marketing targets
– internal marketing evaluation
• The hidden face of strategic internal marketing
Causes of Improper
Implementation
• Marketing strategy is inappropriate or unrealistic
• Implementation was inappropriate for the strategy or
was simply mismanaged
• Internal &/or external environment changed
significantly between the development of the
marketing strategy & its implementation
Where does that leave us with
strategy implementation?
• Execution skills versus process management in strategy
implementation
– weak implementation
– management-driven implementation
– implementation-driven strategy
– integrated strategy and implementation
Execution skills versus
process management
in marketing strategy implementation
Process management
High
Low
Integrated
ManagementStrong
strategy and
driven
implementation implementation
Execution
skills
ImplementationWeak
Weak
driven
implementation
strategy
A route-map for market-led
strategic change
Part I
Customer value
imperatives
Part II
Developing a value-based
marketing strategy
The strategic pathway
Market sensing
and learning
strategy
The Customer
is always
right-handed
New
marketing
meets
old marketing
Value-based
marketing
strategy
Strategic
thinking and
thinking
strategically
Strategic
market choices
and targets
Customer value
strategy and
positioning
Strategic
relationships
and networks
Part III
Processes for managing
strategic transformation
Change strategy
Strategic
gaps
Organization
and processes
for change
Implementation
process and
internal
marketing