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everything from technical specifications for new products to the best cities for staging product launches. This suffocating structure dramatically increased HP's decision-making and market-reaction time. For example, in one case, it took almost 100 people over seven weeks just to come up with a name for the company's New Wave Computing software.
In 1990, when one of HP's mast important projects, a series of high-speed workstations, slipped a year behind schedule as a result of seemingly endless meetings about technical decisions, top management finally took action. It removed the project's 200 engineers from the formal management structure, so that they could continue work on the project free of the usual committee red tape. The workstation crisis convinced IIP management that it must make similar changes throughout the company.
[Top management] wiped out HP's committee structure and flattened the organisation. 'The results arc incredible,' says [TIP executive Bob] Fraiikenberg, who
Sot'RCBS- See Donald R Harvey, Business Polity and StrategicManagement (Columbus, OH; Merrill, 1982), pp. 2()9-70; Thomas J. Peters and Robert H. Waterman, In Search ofExcellence: Less&nsjrom America's best-run companies (New York: Harper & Row, 19821. Excerpts from 'Who's excellent now"1*', Business Week (5 November 1984), pp. 76-8; Barbara Buell, Robert D. Hot" and Gary MeWilliams, 'llewlutt-Paekard rethinks itself, Business Week (1 April
1991), pp. 76-9; and Robert D. Hof, 'Suddenly, Hewlett-Packard is doing everything right', liwiiness Week (2,! March
now deals with three committees instead of 38. We are doing more business and getting product out quicker with fewer people.'
In iess than a decade, Hewlett-Packard's structure has evolved from the decentralized and informal 'IIP Way' to a centralized committee system and back again to a point in between. HP is not likely to find a single best structure that will satisfy all of its future needs. Rather, it must continue adapting its structure to suit the requirements of its ever-changing environment.
programme shows what must be done, who will do it, and how decisions and actions will be co-ordinated. Second, the company's formal organisation structure plays an important role in implementing marketing strategy. In their study of successful eompanies, Peters and Waterman found that these firms tended to have simple, flexible structures that allowed them to adapt quickly to changing conditions.®' Their structures also tended to be more informal - Hewlett-Packard's MRWA (management by walking around), 3M's 'clubs' to create small-group interaction, and Nokia's youthful, egalitarian culture.21 However, the structures used by these companies may not be right for other types of firm, and many of the study's excellent eompanies have had to change their structures as their strategies and situations have changed. For example, the same informal structure that made Hewlett-Packard so successful caused problems later. The company has since moved towards a more formal structure (see Marketing Highlight 3.4).
Another factor affecting successful implementation is the company's decision-and-reward systems - formal and informal operating procedures that guide planning, budgeting, compensation and other activities. For example, if a company compensates managers for short-run results, they will have little incentive to work towards long-run objectives. Companies recognizing this are broadening their incentive systems to include more than sales volume. For instance, Xerox rewards include customer satisfaction and Ferrero's the freshness of its chocolates in stores. Effective implementation also requires careful planning. At all levels, the company must fill its structure and systems with people who have the necessary skills, motivation and personal characteristics. In recent years.
tie nisi on-ii nd-reward system
Formal and informal operating procedures chat guide planning, targeting, compensation and other activities more and more companies have1 recognized that long-run human resources planning can give the company a strong competitive advantage.
Finally, for successful implementation, the firm's marketing strategies must fit with its culture. Company culture is a system of values and beliefs shared by people in an organization. It is the company's collective identity and meaning. The culture informally guides the behaviour of' people at all company levels. Marketing strategies that do not fit the company's style and culture will be difficult to implement. Because managerial style and culture are so hard ty change, companies usually design strategies that fit their current cultures rather than trying to change their styles and cultures to fit new strategies."
Thus successful marketing implementation depends on how well the company blends the five elements - action programmes, organization structure, deeision-and-reward systems, human resources and company culture - into a cohesive programme chat supports its strategies.
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