Organizational structure and specialized marketing capabilities in SMEs

Abstract

Purpose-This paper aims to develop and test a conceptual model of organizational structure design that incorporates some factors influencing strategy implementation. The research also aims to consider inter-functionality in new product development (NPD) processes and marketing decisions, measured from the dispersion of these activities among functional areas. Design/methodology/approach-The research was conducted across 424 small and medium-sized furniture manufacturing companies. In total, eight hypotheses were proposed and tested using structural equation modeling. Findings-Most important among the study's findings was that inter-firm relationships and inter-functional processes are relevant for the study of organizational structure design. It was found that the dispersion of the new product development process and of marketing decisions exert a positive influence on architectural marketing capabilities. The results showed that the dispersion of NPD processes and marketing decisions influence the development of marketing capabilities only in those companies with inter-firm relationships. The paper also found that inter-firm design did not affect the impact of the relationship between the dispersion of marketing decisions and NPD process on specialized capabilities. Research limitations/implications-The study focuses research on Brazilian small to medium-sized furniture enterprises and could have single-source bias in its data collection process. Practical implications-The findings provide insights into ways of integrating structures. It is observed that a higher integration of areas in marketing decisions is related to the dispersion of the NPD process. Given that dispersion in NPD is a disseminated practice, it is found that higher dispersion in marketing activities has an impact on product development. Originality/value-The paper's findings confirm the influence of organizational design on the development of planning capabilities and on the implementation of marketing strategies.

Impact of information technology innovation on firm performance in Kenya

“…Organizational structures have a substantial impact on the firm's financial performance and the ability to manage employees (Setiawan, Putrawan, Murni, & Ghozali, 2016). The organizational structure defines how jobs and tasks are coordinated between individuals and teams within the firm (Trez & Luce, 2012).…”

Marketing Strategy Process: analyzing the sequential relationships among its strategic activities

“…We also contribute to the research stream on marketing strategy making by offering an explanation about how marketing strategy formulation and implementation may be related. Recent research has addressed the importance of marketing formulation and implementation processes in order to firms achieve higher performance (Finoti et al, 2017;Morgan, 2012;Morgan et al, 2012;Trez & Luce, 2012). However, by offering a fine-grained analysis of the relationships among the activities in each step, we could determine that strategic consensus is the formulation element that guarantees the link with the implementation efforts.…”

“…Following the organizational strategy literature, some researchers have advanced the marketing field, by considering the marketing strategy making as formed by two major steps: formulation and implementation (e.g. El-Ansary, 2006;Finoti et al, 2017;Morgan et al, 2003;Morgan et al, 2012;Morgan, 2012;Trez & Luce, 2012). The results of these studies show that the formulation processes only have an impact on firms performance when they are followed by implementation efforts.…”

“…To implement marketing strategies, managers need to translate strategic plans into actions, and this is only possible when they allocate appropriate strategic resources (Morgan et al, 2003;Trez & Luce, 2012). It is widely known that the marketing function is sometimes considered a source of waste because it is hard to measure its direct influence on performance.…”

“…Some researchers have investigated the relationship between the processes of marketing strategy formulation and implementation. In general, their results demonstrate that formulation alone is not capable of generating positive results for the company, always depending on the implementation process (Finoti et al, 2017;Morgan, Katsikeas, & Vorhies, 2012;Morgan, Zou, Vorhies, & Katsikeas, 2003;Trez & Luce, 2012). Thus, despite the established relationship between the two process steps, and the broad interest on the topic, little is known about the interrelationships among the activities at each stage and even less about how the formulation activities individually influence the implementation ones (Hutzschenreuter & Kleindienst, 2006) (see Figure 1, p. 5 for an overview of how researchers are exploring the marketing strategy process).…”