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How marketers can understand their organizational identity and why it’s important
October 7, 2022
By Mark Holden (CSO, PHD Worldwide)
In the last 15 years, rapid advances in consumer technology have had a significant impact on marketing communications and created new opportunities for marketers to connect with consumers.
However, this has also increased complexity. A study carried out by PHD and WARC in 2021 found that, over the last 10 years, there had been a 51% increase in the number of marketing capabilities a typical organization needs to manage.
But ramping up isn’t easy. Today, many marketers are still unsure whether to in-house or outsource, for example, or whether to create advanced network service hubs or offshore for efficiencies.
They are also trying to figure out how new capabilities should interrelate with each other, how they can be underpinned by technology, and what KPIs they’ll use to judge incremental impact.
To learn how to make the right decisions, however, marketers should start by understanding the organizational identity of the company they work in – because there is no one-size-fits-all solution.
Optimizing the model
Organizations can be grouped into one of four types, split by two core dimensions: ‘product-led versus marketing-led’ and ‘centralized or decentralized’.
These can be visualized as follows:
Above: The Organizational Identity Matrix
The ‘product-led versus marketing-led’ dimension asks, does the marketing focus on the product or is the focus on the ever-changing nature of the market?
The ‘centralized or decentralize’ dimension asks to what extent is marketing organized around centralized governance and support, versus being devolved to multiple regions or departments?
Within the product-led dimension are two organization types: ‘engineers’ and ‘inventors’. ‘Engineers’ are focused on product excellence and consistency of delivery, while ‘inventors’ adapt products and marketing to remain relevant in market.
Within the marketing-led dimension are ‘networkers’ and ‘entrepreneurs’. The former are networked companies of specialists, who work together to evolve products according to market conditions. The latter respond to market conditions with diverse products and outputs.
‘Inventors’ and ‘entrepreneurs’ are often decentralized organizations, whereas ‘engineers’ and ‘networkers’ mostly fit within more centralized company structures.
Each of the four organizational types has very clear requirements for how its marketing services should be structured to run successfully. These can be understood as follows:
‘Engineers’ are organizations centered on product excellence and consistency of delivery. They typically have a well-ordered product schedule that, for global companies, is likely to run across markets.
These organizations work best by centralizing creative assets and using a broad range of media channels, supported and/or executed from hubs for efficiency and consistency. However, they let local markets shape campaigns to remain culturally relevant.
Looking to the future, ‘engineers’ should carry out routine marketing support services in offshore/nearshore locations to boost efficiencies and standardize approaches – which is important for measurement and reporting consistency.
Beyond media, ‘engineers’ want unchanging creative oversight to ensure long-term branding remains as consistent as product quality. They should look to agencies, therefore, to provide fresh interpretations of core themes for each new campaign, based on what is happening in culture.
Inventor-based organizations are different from ‘engineers' due to their decentralized structures. Marketers and local markets are often left to ‘do their own thing’ – from using their own channel mix and technology providers, to assessing the contribution of each element of marketing. This level of freedom can be empowering, but also crease inefficiencies, and, in some cases, lead to some markets falling behind.
‘Networkers’ are often very large and/or mature organizations that have become more centralized over time. To respond to changing consumer behavior and constant product and marketing refinements, ‘networkers’ will need to develop a highly connected workforce, be able to operate effectively across silos, and place a significant focus on workflow technology.
A major focus for marketing within these organizations, therefore, should be on finding the balance between the short-term (being responsive to a changing marketplace) and the long-term contribution of the brand.
Agencies can add real value to ‘networkers’ with more holistic portfolio-based planning services – bringing order to multiple products and overlapping campaigns, and, also, hubbing advanced capabilities to augment local markets activation.
Finally, ‘entrepreneur’ organizations are those that tend to respond rapidly to opportunities, due to their single-minded focus on the marketplace. External agency support, therefore, needs to be deeply integrated for agility, perhaps even embedded within the client organization.
As with the inventor-type companies, ‘entrepreneurs’ should also share best practice within their networks, but with a greater focus on technology. This can enable real-time sharing of trends and case studies as they emerge from countries across the world.
To reorganize successfully for the future, all marketers need to understand their company’s organizational identity before rethinking areas such as capabilities, technology, processes, and measurement. To get ahead, they must act now.
To read more about organizational identities, pick up a copy of PHD’s latest book, Shift | A Marketing Rethink.