Recent research into strategy implementation is damning
in its findings. 'The reality is that traditional (marketing)
implementation approaches have failed'. Similarly in the October 1999 issue of the Journal of Marketing, Noble and Mokwa
wrote, '[Marketing] Implementation [...] is a critical link between
formulation of marketing strategies and the achievement of superior
organizational performance [...]. Yet, the nature of implementation and
reasons for success or failure are understood poorly'.
According to Yeniyurt,
the marketing field is now giving high priority to developing marketing
metrics. The role of marketing channels is to implement marketing
strategy. The difficulty of channel strategy is compounded by the
emergence of e-channels and the need to integrate e-channels into
traditional or 'bricks and mortar' channels. Ambler et al.
contend that metrics usage is substantially moderated by (a company's)
size and sector. The authors suggest that 'larger firms use more metrics
and the needs of retail, for example, are different from those in the
consumer goods sector'.
A
fundamental proposition in marketing strategy is that distribution
channels must be aligned with customers and competitive advantage.
Unfortunately, channel performance measurement literature has provided
ambiguous guidance to marketing managers. This paper addresses the
problem by putting forward a conceptual model that uses strategy as the
primary determinant of the characteristics of the performance
measurement system.
Measurement plays a crucial role in strategy implementation according to Kaplan and Norton. Neely et al.
conducted a review of the performance measurement literature. They
observed that while many measurement frameworks have been developed and
many others have offered criteria for the measurement system design, a
generally pertinent systematic approach to performance measurement has
not been built. In this respect, research in distribution channels has
highlighted a 'channel performance metric paradox.' Because different
systems and different channels necessitate particular measurement
structure characteristics, it is impossible for a business organisation
to maximise concurrently, all channel performance measures.
The
literature argues, however, that the extent to which each determinant
of performance impacts firm performance is a function of the performance
metrics (see, eg Eccles; Neely; Simons). Further, Lebas and Euske
define performance as 'the sum of all processes that will lead managers
to taking appropriate actions in the present that will create a performing organisation in the future' or in other words, 'doing today what will lead to measured value outcomes tomorrow'.
This
paper is conceptual in nature and while adopting Miles and Snow
strategy types' framework, it offers a model that endeavours to
reconcile the 'channel performance metric paradox'. In so doing, we show
that in order to achieve marketing success, it is important to
understand the relationship between channel performance measures and
strategy deployment success. Our research seeks to identify that
strategy is the key determinant of channel metric characteristics.
This
paper is organised in the following way. First, a review of the
performance measurement, marketing channels and strategy implementation
literature is undertaken. Next, channel performance measurements are
integrated with Miles and Snow's strategy implementation framework.
Following that a research model that is specific to channels is
developed with research propositions. Finally, guidance is provided to
marketing managers in the use of the model in framing a system of
marketing channel performance measurement.
The paper
contributes to marketing practice by clarifying the key channel
performance measures in an organisational context. It also identifies
which performance measures should be emphasised to avoid the channel
performance metric paradox. This paradox occurs where undesirable
performance trade-offs occur when the improvement of one performance
measure reduces the performance of another measure.
Further more information about this articles, please you check on Journal of Database Marketing & Customer Strategy Management.
By Michael J Valos & Andrea Vocino
Repost by Acarre Community Media
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