sense of humor, and say thank you for a job well done.” The performance result? Low employee turnover and a large increase in the value of its stock. Structure : Build and maintain a fast, flexible, flat organization. Successful small organizations often grow into bureaucratic large ones with layers of managers and red tape that slow decision making. The unquestioned all-time leader in delivering world- class aircraft with only a small team of engineers, designers, and machinists: Lockheed Martin's Skunk Works. Discussed later in the chapter, its first director set key organizational guidelines, like “use a small number of good people who can talk to anyone in the organization to solve a problem.” 12 France and Russia have attempted to apply Skunk Works guidelines to their aircraft production. Allocating Marketing Resources Using Sales Response Functions A sales response function relates the expense of the marketing effort to the marketing results obtained. The Planning Phase of the Strategic Marketing Process Goals define where the organization is trying to go, whereas metrics are the measuring sticks used to determine whether the efforts are successful. The key is to determine which kinds of metrics to use to determine success or failure. Metrics might include measures such as market share, profitability, quality improvement, customer satisfaction, etc. Revenue growth due to new products or services and customer satisfaction with new products or services ( output metrics ). Number of ideas or concepts in the new-product pipeline and R&D spending as a percentage of sales ( input metrics ). The Variety of Marketing Plans Long-Range Marketing Plans Typically, long-range marketing plans cover marketing activities from two to five years into the future. Except for firms in industries such as autos, steel, or forest products, marketing plans rarely go beyond five years into the future. Annual Marketing Plans
Usually developed by a marketing or product manager (discussed later in the chapter) in a consumer products firm such as General Mills, annual marketing plans deal with marketing goals and strategies for a product, product line, or entire firm for a single year. Porter's Generic Business Strategies A generic business strategy is one that can be adopted by any firm, regardless of the product or industry involved, to achieve a competitive advantage. FIGURE 22-4 Porter's four generic business strategies involve combinations of (1) competitive scope or the breadth of the target markets and (2) a stress on costs versus product differentiation. A cost leadership strategy (cell 1) focuses on reducing expenses and, in turn, lowers product prices while targeting a broad array of market segments . One way is by securing raw materials from lower-cost suppliers. Also, significant investments in capital equipment may be necessary to improve the production or distribution process and achieve these lower unit costs. The cost leader still must have adequate quality levels . Campbell Soup's sophisticated product development and supply chain systems have led to huge cost savings.