DISPENSE DEL CORSO MARKET- DRIVEN MANAGEMENT

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1 DISPENSE DEL CORSO MARKET- DRIVEN MANAGEMENT PROGRAMMA 9 CFU ANNO ACCADEMICO 2014/2015 PROF.NICCOLÒ GORDINI

2 MATERIALE 1. Gordini, N., Market-Driven Management: From the Japanese Experience to the European Schools, in Brondoni S.M. (Ed.), Market-Driven Management and Corporate Growth, Giappichelli, Torino, 2012; 2. Rancati E., Market-Driven Management: Global Markets and Time-Based Competition, in S.M. Brondoni (ed.), Managerial Economics and Global Corporations, Giappichelli, Torino, 2012; 3. Gordini, N., Imprenditore e Attitudini Imprenditoriali. Aspetti Teorici ed Evidenze Empiriche, Pearson, Torino, 2013 (Introduzione, Capitolo 1, Capitolo 2 e Capitolo 3); 4. Ciampi, F., Fondamenti di Economia e Gestione delle Imprese, FUP, Firenze, 2004 (Parte I paragrafi 6 e 7 e Parte II paragrafi 3.2, 3.3, 3.4 e 4); 5. Best, R.J., Market-Based Management, Pearson Prentice Hall, Upper Saddle River, New Jersey, USA, 2009 (Capitolo 15 e Capitolo 16) (DA AGGIUNGERE A QUESTA DISPENSA)

3 Market-Driven Management: From the Japanese Experience to the European Schools Niccolò Gordini * 1. From Scientific Management to Marketing Management In the 1920s the market structure was homogeneous and not differentiated. Supply controlled demand, defining the quantities produced and sold, and therefore the prices, and had the knowledge and information necessary to programme future activities. The entire output was sold at the price set by the manufacturer and there were usually no stocks of products because everything produced was sold (scarcity of supply, D>S). The scientific management model, introduced by Taylor 1 and then developed by Ford 2 and others 3, was perfect for compete in these conditions. It was based on the theory of the scientific organisation of labour, the supremacy of product orientation and price competition. It was designed to achieve economies of scale based on standardised mass production, the rationalisation of the manufacturing process and a reduction in dead time, by the introduction of the assembly line. * Assistant Professor of Management, University of Milan-Bicocca. 1 Cf. F.W. TAYLOR, The Principles of Scientific Management, Harper Brothers, New York, NY, and London, UK Cf. H. FORD-S. CROWTHER, My Life and Work, Garden City Publishing Company Inc, New York, NY, 1922; H. FORD S. CROWTHER, Today and Tomorrow, Doubleday, Page & Company, New York, NY, 1926; H. FORD S. CROWTHER, Moving Forward, Garden City Publishing Company Inc., New York, NY, Among others cf. H. GNATT, Organizing for Work, Harcourt, Brace & Howe, New York, NY, 1919.

4 96 Niccolò Gordini In the middle of 1930s the debate on market structure took new approaches thank to two main works: the Robinson s Economics of Imperfect Competition 4 and the Chamberlin s Theory of Monopolistic Competition 5. They face the competitive structure of the market in completely different ways in aim and methodology. In particular, the study of Chamberlin can be considered revolutionary because, for the first time, he highlights the importance of factors as product differentiation, the advantages of location, the role of advertising, and brand preference that lead to new market structures. He coined the term product differentiation to describe how a supplier may be able to charge a greater amount for a product. Product dfferentiation simply means the process by which sellers try to distinguish their products from others by making them more attractive to particular buyers. Brand names are a typical example of product differentiation. If physical products are often similar, the brand name is what makes the products distinct. In the 1950s the market conditions definetely change and the economy entered a period of sustained growth (controlled competition, D S). Unlike scarcity of supply, on markets in controlled competition there are numerous alternatives to choose from, all with the same goal and belonging to the same product class to meet the same need. The presence of alternatives allows demand to express its capacity for choice, highlighting different companies capacity to react to satisfy numerous demand segments. In this period a new management philosophy, known as Marketing Management, began to take hold. Unlike scientific management, marketing management presupposes that the company has detailed knowledge of demand and of its segments, so that it can offer differentiated products that are able to fill different market spaces and to respond to the saturation fo demand. Companies modify their strategies from price competition to non-price competition. In other words they invest in product differentiation and, consequently, in demand segmentation to increase sales volumes and stabilise market share compared to their competitors. As a result, with marketing management, the management process starts from demand to define the characteristics of a product that is destined to fill a specific supply vacuum, by creating segments that tend to be homogeneous internally and heterogeneous externally, easily 4 Cf. J. ROBINSON, The Economics of Imperfect Competition, Palgrave Macmillan, Cf. E.H. CHAMBERLIN, Theory of Monopolistic Competition, Harvard University Press, Cambridge, MA, 1933.

5 Market-Driven Management: From the Japanese Experience to the European Schools 97 identifiable and stable for longer periods of time. The demand segmentation process enables companies to deal with the inhomogeneity they come up against, and to search for homogeneous conditions on which to focus their policies. 2. The Rise of Market-Driven Management: the Japanese Experience Starting in the early 1980s, the globalisation lead to further changes in market conditions, evolving from a controlled competition to one of oversupply (D<S). These changes led Ohno 6, the father of the Toyota Production System and, by extension, of the market-driven management to question how to compete in increasingly dynamic and global markets. The Toyota Production System is a manufacturing philosophy based on lean production, just-in-time and total quality management 7. It has numerous similarities with scientific management and marketing management, implementing some of their distinctive features. However, underlining the main differences helps to establish the basis for the development of market-driven management. The first difference regards the market structure in which these three corporate policies are successful. The Toyota model was created and developed in a competitive environment which differs significantly from both the scientific management (born in a market where supply was scarce and based on the idea of the absence of limits the infinite expandability of the demand framework) and the marketing management (based on controlled competition and on the importance of controlling demand by differentiating supply through non-price competition logics). The Toyota model borns in a dynamic market characterised by the competitive role of the time (time-based competition) and of the space (market-space competition), by awareness of the limit, of the impossibility of continuing to produce ever greater quantities of undifferentiated products and of the need to 6 Cf. T. OHNO-S. MITO, Just-In-Time for Today and Tomorrow, Productivity Press, Portland, OR, 1988a; T. OHNO, Toyota Production System: Beyond Large Scale Production, Productivity Press, Portland, OR, 1988b; T. OHNO, Workplace Management, Productivity Press, Portland, OR, 1988c. 7 Cf. E.W. DEMING, Quality, Productivity and Competitive Position, Massachusetts Institute of Technology, Center for Advanced Engineering Study, Cambridge, MA, 1982.

6 98 Niccolò Gordini produce smaller quantities of increasingly differentiated products to face up to a saturated market. This first difference lead us to the second one: the change in the company-market relationship from a situation of supply-demandcompetition, where supply dominates demand thanks to low competitive intensity, to one of competition-demand-supply. In such situation, competitor s manufacturing decision and the subsequent volubility of demand constantly modify output. The Toyota system encourages output to meet the market halfway by producing small quantities of a large number of models. This clear inversion of the supply-demand relationship emerges clearly if we analyse information flow trends. In scientific management and marketing management the information flow moves in a linear way from top to bottom originating from management which takes the decisions, extends them to all the company, and finally reaches the market in a supply-demand relationship. In the Toyota system communication goes from bottom to top. Company is still responsible for defining strategies, but the information flows originate from the market and are transmitted retroactively to the firm, by the kanban technique. These changes led Ohmae 8 to support and corroborate Ohno s theories. In The Borderless World published in 1990, Ohmae 9 predicted the rise and success of globalisation. In his studies, he synthesises today s emerging trends into the first coherent view of tomorrow s global economy and its implications for politics, business and personal success. For Ohmae, globalisation is not a myth, but a fact. We cannot stop it. It has already happened and we are moving into a new global stage. According to Ohmae s theory, a radically new world is taking shape from the ashes of yesterday s nation-based economic world. As a result, companies have to act with very short action/reaction times and extended spaces that can no longer be identified with specific physical/administrative contexts. 8 Cf. K. OHMAE, The Next Global Stage: Challenges and Opportunities in Our Borderless World, Prentice Hall, Upple Saddle River, New Jersey, 2005; K. OHMAE, Globalization, Regions and the New Economy, UCLA, Center for Globalization and Policy Research, Working Paper n.1, January 2001; K. OHMAE, The Borderless World. Power and Strategy in the Global Marketplace, Harper Collins Publisher, New York, NY, 1994; K. OHMAE, The Myths and Realities of Japanese Corporation, Japan Society Gallery, Japan, 1992; K. OHMAE, Managing in a Borderless World, in Harvard Business Review, 1990, pp ; K. OHMAE, The Mind of the Strategy: The Art of Japanese Business, McGraw-Hill, 1 edition, New York, NY, Cf. K. OHMAE, Managing in a Borderless World, cit.

7 Market-Driven Management: From the Japanese Experience to the European Schools 99 Companies have to adopt a new management policies that must be market-oriented (market-driven management) and no longer limited to the product (scientific management) or to demand (marketing management). 3. Market-Driven and Market Driving Management: The American School Market-driven management took concrete shape in the late 1980s as an effect of globalisation and the innovations introduced by the Japanese. During the last decades, many researchers 10 have refined the concept of market-driven management, valid measures of the market orientation developed, and a strong relationship demonstrated between market orientation and business performance 11. All these studies support the 10 Cf. R.J. BEST, Market-Based Management, Prentice Hall, 5th ed., 2009; G.S. DAY, Creating a Market-Driven Organization, in Sloan Management Review, Fall 1999, pp ; G.S. DAY, The Capabilities of Market-Driven Organization, in Journal of Marketing, 58 (4), 1994, pp ; G.S. DAY, What Does It Mean to Be Market-Driven?, in Business Strategy Review, 9(1), 1998, pp. 1-14; G.S. DAY, Market-Driven Strategy: Processes for Creating Value, Free Press, New York, 1990; G.S. DAY, Market-Driven Winners, in Symphonya. Emerging Issues in Management (www.unimib.it/symphonya), n. 2, 2000/2001, pp ; G.S. DAY, The Market-Driven Organization, Free Press, New York, NY, 1999; B. JAWORSKI-A. KOHLI, Market Orientation: Review, Refinement, and Roadmap, in Journal of Market-Focused Management, 12, 1996, pp ; J.C. NARVER-S.F. SLATER, The Effect of Marketing Orientation on Business Performance, in Journal of Marketing, 54 (4), 1990, pp ; S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, in Business Horizons, 37 (2), 1994, pp ; S.F. SLATER-J.C. NARVER, Market Orientation and the Learing Organization, in Journal of Marketing, 59 (3), 1995, pp ; S.F. SLATER- J.C. NARVER, Customer-Led and Market-Oriented: Let s Not Confuse the Two, in Strategic Management Journal, 19 (10), 1998, pp ; S.F. SLATER-J.C. NARVER, Market- Oriented Is More that Being Customer-Led, in Strategic Management Journal, 20 (12), 1999, pp ; F.E. WEBSTER JR., Market-Driven Management, John Wiley and Sons, Hobboken, 1994; F.E. WEBSTER JR., Marketing-Driven Management. How to Define, Develop and Deliver Customer Value, Second Edition, John Wiley & Sons, New York, 2002; F.E. WEBSTER JR, The Changing Role of Marketing in the Corporation, in Journal of Marketing, 56, 1992, pp. 1-17; F.E. WEBSTER JR, The Future Role of Marketing in the Organization, in LEHMAN D.R. E JOCZ K.E. (ed.), Reflections on the Futures of MarketinG, Marketing Science Institute, Cambridge, MA, 1997; F.E. WEBSTER JR, The Rediscovery of the Marketing Concept, in Business Horizons, 31 (3), 1988, pp Cf. B. JAWORSKI-AJAY K., Market Orientation: Antecedents and Consequences, in Journal of Marketing, 57, pp , 1993; J.C. NARVER-S.F. SLATER., The Effect of Marketing

8 100 Niccolò Gordini conclusion that market orientation is essential to success in a global market. However, according to Slater and Narver 12, much that has been written about the nature and consequences of being market oriented is incomplete or incorrect. This misundertanding has occurred because authors, without realizing it, are often confusing two different concepts: marketing orientation and market orientation. In fact, marketing-oriented and market-oriented are occasionally used synonymously 13, but there is a profound difference between them, which marks the evolution from marketing management to market-driven management. The concept of marketing orientation place the marketing function at the top of an organizaional behavior 14. In this regard Drucker 15 argues that marketing represents such an important function for the company that it is no longer possible to limit it and identify it only with a strong sales department. In an article of 1960, Keith 16 compared the evolution from a focus on sales to a focus on the customer to the Copernican revolution: it is the company that revolves around the customer rather than the customer around the company. Marketing oriented companies underpins the development of an organisational culture that place the consumer at the centre of company strategies and policies. The role of marketing, as corporate function, is to coordinate and manage the 4Ps in order to make a company more aware of its customers needs 17. Market- Orientation on Business Performance, cit.; S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit.; S.F. SLATER-J.C. NARVER, Market Orientation and the Learing Organization, cit.; S.F. SLATER-J.C. NARVER, Customer-Led and Market-Oriented: Let s Not Confuse the Two, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit. 12 Cf. S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit. 13 Cf. B.P. SHAPIRO, What the Hell is Marketing Oriented, in Harvard Business Review, 66 (6), 1998, pp Cf. S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit. 15 Cf. P.F. DRUCKER, The Practice of Management, Harper & Brothers, New York, NY, Cf. R.J. KEITH, The Marketing Revolution, in Journal of Marketing, 24, 1960, pp Cf. J.J. LAMBIN, Ouverture de Market-Driven Management and Competitive Customer Value, in Symphonya. Emerging Issues in Management (www.unimib.it/symphonya), n. 2, 2009, pp. 1-12; J.J. LAMBIN, Market-Driven Management: Strategic and Operational Marketing, Macmillan Business, London, 2000; J.E. MCCARTHY., Basic Marketing - A Managerial Approach, Irwin, Illinois, 1960; C.P. MCNAMARA, The Present Status of the Marketing Concept, in Journal of Marketing, JANUARY, 31 (1), 1972; pp ; P. KOTLER, Marketing Management, Upper Saddle River, Prentice-Hall, New York, 1967.

9 Market-Driven Management: From the Japanese Experience to the European Schools 101 ing-oriented companies focus on understanding the expressed desires of the customers and on developing products and services that satisfy those desires. Typically, marketing oriented companies use focus groups and customer surveys to enhance their understanding of customer wants and techniques such as conjoint analysis to guide the development of new products and services. The problem with this philosopy is that it is concerned with satisfying customer s expressed needs, it is reactive and short term in focus, it generally leads to adaptive rather than generative learning 18 and it leads to internal conflict over resources allocations and business priorities. On the other hand, the concept of market orientation 19 rethinks the concept and the role of the marketing function and extends the definition of market not only to the customers but also to all its players 20. Therfore, the development of a market orientation can not be left entirely to the marketing department because it demands the involvment of all company functions 21. Being market-oriented is more than being marketing oriented. When researchers cite Druker s 22 remark that marketing is the whole business seen from the final point of view of its final result, that is, from the customer s point of view, they seem to miss a major point of the analysis. According to Slater and Narver 23, market-oriented companies 18 Cf. P. SENGE, The Fifth Discipline, Doubleday, New York, NY, Cf. G.S. DAY, Creating a Market-Driven Organization, cit.; G.S. DAY, The Capabilities of Market-Driven Organization, cit.; G.S. DAY, What Does It Mean to Be Market-Driven?, cit.; G.S. DAY, Market-Driven Strategy: Processes for Creating Value, cit.; B. JAWORSKI-A. KOHLI, Market Orientation: Review, Refinement, and Roadmap, cit.; B. JAWORSKI A.K. KOHLI-A. SAHAY, Market Driven Versus Driving Markets, in Journal of the Academy of Marketing Science, 28 (1), 2000, pp ; A.K. KOHLI B. JAWORSKI, Market Orientation: The Construct, Research Propositions, and Managerial Implications, in Journal of Marketing, 54, 1990, pp. 1-18; J.C. NARVER-S.F. SLATER, The Effect of Marketing Orientation on Business Performance, cit.; S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit.; S.F. SLATER-J.C. NARVER, Market Orientation and the Learing Organization, cit.; S.F. SLATER-J.C. NARVER, Customer-Led and Market-Oriented: Let s Not Confuse the Two, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit.; F.E. WEBSTER JR, The Rediscovery of the Marketing Concept, cit. 20 Cf. S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit. 21 Cf. G.S. DAY, Market-Driven Winners, cit. 22 Cf. P.F. DRUCKER, The Practice of Management, cit. 23 Cf. S.F. SLATER-J.C. NARVER, Customer-Led and Market-Oriented: Let s Not Confuse the Two, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit.

10 102 Niccolò Gordini are committed to understanding both the expressed and latent needs of their customers and the capabilities and plans of their competitors through the processes of acquiring and evaluating market information in a systematic and anticipatory manner. They continuously create superior customer value by sharing the knowledge broadly throughout the organization and by acting in a coordinated manner 24. Coordinated action among all business functions is, in fact, a core element in all conceptualizations of market orientation 25 Compared to marketing oriented companies, market oriented companies scan the market more broadly, have a longer-term focus, and are much more likely to be generative learners 26 Narver and Slater 27 suggested that market o- rientation consists of three behavioral components (customer orientation, competitor orientation, and interfuctional coordination) and two decision criteria (long term focus and profitability). Kohli and Jaworski 28 articulated a theory of market orientation that they describe as the implementation of the marketing concept. To achieve superior performance a company must develop and sustain competitive advantage. But, where competitive advantage was once based on structural characteristics such as market power, the emphasis today has shifted to capabilities that enable a company to consistently deliver superior value to its customers 29. Studies show that a market-oriented culture provides a solid foundation for these value-creating capabilities. Market-oriented businesses seek to understand customers'expressed and latent needs, and 24 Cf. S.F. SLATER-J.C. NARVER, Market Orientation and the Learing Organization, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit. 25 Cf. R. DESHPANDE-J.U. FARLEY-F.E. WEBSTER JR., Corporate Culture, Customer Orientation, and Innovativeness in Japanese Firms: A Quadrad Analysis, in Journal of Marketing, 57, 1993, pp ; A.K. KOHLI B. JAWORSKI, Market Orientation: The Construct, Research Propositions, and Managerial Implications, cit.; J.C. NARVER-S.F. SLATER., The Effect of Marketing Orientation on Business Performance, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit.; B.P. SHAPIRO, What the Hell is Marketing Oriented, cit. 26 Cf. P. SENGE, The Fifth Discipline, cit. 27 Cf. J.C. NARVER-S.F. SLATER., The Effect of Marketing Orientation on Business Performance, cit. 28 Cf. A.K. KOHLI B. JAWORSKI, Market Orientation: The Construct, Research Propositions, and Managerial Implications, cit. 29 Cf. S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit.

11 Market-Driven Management: From the Japanese Experience to the European Schools 103 develop superior solutions to those needs 30 Therefore, a company is market-oriented when its culture is systematically and entirely committed to the continuos creation of superior customer value 31. This entails collecting and coordinating information not only on customers but also on competitors, and other significant market influencers (such as suppliers) to use in building that superior value. Jaworski and Kohli 32 point out that reacting to customers' expressed needs is usually inadequate for the creation of competitive advantage. Market-oriented companies do not ignore their current customer base or the expressed needs of their customers. They do realize that, since competitive advantage is often temporary, the firm must understand how customers' needs are evolving and develop innovative solutions to those needs 33. Thus, the greater the market orientation of the firm, the greatert the proportion of its activities that are oriented to understanding latent needs. A company s opportunities for success will be maximized when all organizational members recognize that they contribute to creating value. Day 34 defined the market-driven company as a company with superior skills in understanding, attracting and keeping valuable customers. Day also clarified that this is not a definition based on absolute standards which, if respected, always qualify a company as successful market-oriented, but that it varies according to the competitive alternative which the company is dealing with. The concept of superior highlights this relativity, underlining that being successful in a competitive market means performing better than the competitors. Although there are no rules than can guarantee that all companies will be successful market-driven companies, Day 35 identifies three characteristics which may produce a successful market-driven company: - a culture focused on the outside world, with values and behaviour 30 Cf. G.S. DAY, The Capabilities of Market-Driven Organization, cit.; A.K. KOHLI B. JAWORSKI, Market Orientation: The Construct, Research Propositions, and Managerial Implications, cit.; S.F. SLATER-J.C. NARVER, Market Orientation and the Learing Organization, cit.; S.F. SLATER-J.C. NARVER, Market-Oriented Is More that Being Customer-Led, cit. 31 Cf. S.F. SLATER-J.C. NARVER, Market Orientation, Customer Value, and Superior Performance, cit. 32 Cf. B. JAWORSKI-A. KOHLI, Market Orientation: Review, Refinement, and Roadmap, cit. 33 Cf. R. D AVENI, Hypercompetition: Managing the Dynamic of Strategic Maneuvering, Free Press, New York, NY, Cf. G.S. DAY, Market-Driven Strategy: Processes for Creating Value, cit. 35 Cf. G.S. DAY, Market-Driven Winners, cit.

12 104 Niccolò Gordini that highlight the importance of creating value for the customer and new sources of competitive advantage; - particular distinctive capabilities to perceive the market, and to define anticipatory strategies. This means that market-driven companies understand their markets in greater depth and are more skilful in forging close links with more important customers; - an organisational configuration that enables the whole company to constantly anticipate customers changing needs and to respond to market conditions. These three elements, when well combined (that is a combination that is superior to that of the competitors,) represent a shared base of knowledge with which a market-driven company collects and disseminates its information and its own view of the market. Finally, over the time, scholars have developed two different, altough complementary, perspectivies to being market oriented: a market-driven perspectivies and a driving-markets perspectivies 36. Both perspectivies represent a strong market orientation that entails a focus not only on customers but also on broader market conditions and players (competitors, buyers, suppliers, etc.). The main difference refers to the structure of a market and the behaviors of players in the markets. Market-driven refers to a given market structure and market behavior. Market-driven companies learn, understand and respond to the preferences of players within a given market structure. Accepting the market structure has given, means the company does not modify the role of existing industry players. In contrast, market-driving implies shaping the market structure and/or behavior of players in the market. In other words, market-driving companies change the structure of the market by changing the composition, role and behaviors of one or more players in a way that enchances the competitive advantage of the company. Market structure and market behavior could be modified directly or indirectly by changing the mind-set of palyers (customers, suppliers, competitors, other stakeholders). Jaworski, Kohli and Sahay 37 identify three generic approach to driving and changing the structure of a market: elimination players in a market (deconstruction approach), building a new set of players and, hence, a new industry structure (construction approach), and changing the functions performed by players (funcional-modification approach). 36 Cf. B. JAWORSKI A.K. KOHLI-A. SAHAY, Market Driven Versus Driving Markets, cit. 37 Ibidem.

13 Market-Driven Management: From the Japanese Experience to the European Schools The Evolution of Market-Driven Management: The European School Lambin 38 was the first in Europe to contextualise the concept of market-driven management to European markets and companies. He identified four stages that characterise the evolution of the concept of marketing: - passive marketing (product orientation); - operative marketing (orientation to sales); - strategic marketing (customer orientation); - market-driven management (cultural dimension and market orientation). In his subsequent studies 39, the author analyses the role of marketdriven companies and their organisational structure, identifying four elements that distinguish market-driven companies from marketing oriented companies: - marketing focuses on the customer, while market-driven management focuses on all the stakeholders (customers, competitors, distributors, specifiers, other stakeholders), according to an outside-out logic; - marketing is based on a simple pull market model (strategic response marketing), while market-driven management is based both on the requests of the market (pull market) and on innovative models linked to a technological impulse (proactive strategic marketing); - marketing is oriented to action and to analysis based on the paradigm of the 4Ps, while market-driven management is oriented to action, analysis and culture; - the concept and the role played by marketing within the organisational structure 40. Marketing management is limited only to the marketing function, while market-driven management is based on a culture that pervades every level and every function of the company, 38 Cf. J.J. LAMBIN, Le Marketing Strategique. Du Marketing à l'orientation Marché, Ediscience, Paris, Cf. J.J. LAMBIN, Changing Market Relationship in the Internet Age, UCL Presses Universitaries de Louvain, Belgique, Cf. J.J. LAMBIN, Le Marketing Strategique. Du Marketing à l'orientation Marché, Ediscience, cit.

14 106 Niccolò Gordini striving to achieve complete functional interaction. Marketing is no longer a distinct, independent corporate function. In a market-driven company, the inter-functional coordination is a key features. Bureaucratic, hierarchical and functional organisations, with a low level of interaction, must evolve into more efficient organisms. Companies that operate on global markets must strive towards new organisational forms with a horizontal, transverse, division of roles, to replace traditional vertical structures organised by processes. The key word for market-driven companies that have to deal with the hypercompetitiveness of global markets is interaction. Nonetheless, Lambin s studies have two significant limitations. A first limit lies in the clear separation between the various concepts of marketing (passive marketing, operative marketing, strategic marketing, market-driven management), as if they were independent. However, although useful theoretically, this distinction is a conceptual rather than a real distinction. Secondly, Lambin underlines the need to go from a vertical structure organised by processes to a transverse structure, but does not show how to achieve it in terms of figures, roles and tasks. He does not consider the fact that, especially in global corporations, this evolution demands even greater flexibility and the reduction of superfluous costs, particularly for personnel. 5. Market-Driven Management and Global Markets: The Italian School Globalisation, which marks the end of traditional space-time competition limits and the spread of interconnected markets with different levels of competitive intensity, has prompted large corporations to operate in contexts dominated by market-space competition and time-based competition. Global markets, therefore, accentuate the adoption of a marketdriven management policy by companies. According to Brondoni and the Milan-Bicocca Management School 41, to whom we owe some of the most 41 Cf., among others, M. CORNIANI, Market, Demand Segment and Demand Bubble, in Symphonya. Emerging Issues in Management (www.unimib.it/symphonya), n. 2, 2005, pp.

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