Sunday, June 6, 2010

Marketing and Organizational Development

The above image from here.

Delivering value to the customer is now the sine qua non of organizational functioning. The value delivery system is now a pan-organizational activity rather than being a departmental function, so customer-centric marketing has become a very vital organizational activity. To deliver value an important approach is ORGANIZATIONAL DEVELOPMENT (OD).

What is organizational development?

OD is a planned effort, conducted by process specialists who improve the organization's diagnostic skills, coping capabilities, create a culture of mutuality and create linkage strategies through semi permanent systems. The product of OD efforts is to improve the overall efficiency and effectiveness of the organization.

It is similar to consulting a physician, who audits the body parts and describes the state of functioning. Diseased or sick organs are then treated to improve overall body functioning.


The starting point of any organization is the vision of the founders or major stakeholders. It is of course a common thing in business enterprises that the ultimate reality is that the major stakeholders want cash ie., profits. To get that cash and a feel-good factor the major stakeholders have various organizational objectives to achieve. These are in terms of market share, sales, brand equity and ROI. However, the foil is the vision that the major stakeholders have for the organization - this vision for the organization is what drives all efforts. Clarity of vision gives rise to a clear shared value system for the stakeholders and other employees.


Vision gives rise to the value system. Values are a silent driving force, an inner framework that makes a person commit to a choice from the available alternatives. The direction and intensity of effort is also influenced by the value system. Desirable or undesirable behavior of employees is due to the value system. Hence, corporate values systems are internalized and actualized through induction and special intervention programs to ensure a common set of shared values.

Unity of action

Common values have a great impact on employee working. Core corporate values generate UNITY OF ACTION. This means employees and organizational members share the values and this creates action in concert. The shared values and unity of action, enables achievement of the organizational vision, cash profit goals and other objectives of the major stakeholders.

For eg., when Piramal Healthcare Solutions was planning to sell its major brands, in line with this vision, the marketing values were evident in their activities. The field force at Piramal were heavily in to market penetration activities - gifting for Rx generation, POB through special chemist centred benefits and so on. All this helped Piramal Healthcare generate good brand valuation and thereby the major stakeholders got a good deal through the sale of the 350 brands of Piramal Healthcare Solutions.

OD interventions required

Abbott after purchasing Piramal Healthcare will need to embark on an extensive OD intervention strategy to cope with the stresses of integration. Process specialists will have to work hard to establish shared values and ensure reallignment by all employees. Only then will Abbott deliver the marketing value. OD will help create synergy and improve customer-centric functioning that is so vital for Abbott now.

Purchasing a company is one thing, however, integrating is the other big and major challenge. Only a finely strategized integrating process and OD based intervention will ensure financial justification for the pharma purchase of the millenium in India! (ie., purchase of Piramal Healthcare Solutions by Abbott).

What will an OD approach entail?

OD intervention will kick off with information gathering for a preliminary report. There will be observation reports, interview with key personnel, surveys, attitudinal mapping activities, culture diagnostics, and process understanding activities undertaken by the process specialists. Finally in the first stage, the OD intervention experts will create a preliminary report on the state of the organization. This will lead to a debate on the basic elements of an OD approach.

The second stage is problem identification. OD specialists will identify specific problem areas through interviews, sharp observations, motivational patterns, mindset analysis and other data gathering instruments. Based on the data, strategy will be devised on how the overall efficiency and effectiveness can be improved.

The third stage is specific intervention. This refers to a planned stuctural group of activities to achieve the goals of OD. This will include marketing strategies, product management strategies, team building, organizational structural changes, and any other means of resolving problems.

The fourth and final stage is that of collaborative culture. The end productof OD intervention is enhanced collaboration between various individuals and other intra organizational entities. This is done through keen analysis of data, reviews and restrategizing till an acceptance of the change is attained.

Hence, we see above the importance of OD approach to enhance marketing value or customer-centric functioning. OD helps re-engineer values and will contribute a great deal to improve general state of organizational functioning and overcome integration challenges in case of mergers or acquisitions. Thanks for reading this blogpost, please scroll down to read other, click on older posts when required, kindly recommend this blog to your colleagues.

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