Reflections for 21st Century Marketing & Sales Leadership
The divide between sales and marketing has historically been exploited managerially to motivate competition between two functions with a common DNA, to feed markets regardless of size and location, regardless of products and services, and regardless of social technologies and social politics to grow the firm’s business through customer related activities.
Marketing and Sales CFR Divide
Orientations
Two thought-world dimensions competence and orientations drive a divisional gap influencing a contentious cross-functional relationship (CFR) between sales and marketing.
Orientations are the goals, time horizons, and objects according to which marketing and sales organize themselves. Orientations regulate which information is processed, and how conflicting argument are measured. Whereas, competence projects the level of technical and social capabilities in marketing and sales (Homburg & Jensen, 2007).
The short and long term orientation of marketing and sales affect judgments on organizational investments and performance measures. Judgements that fuel a rationale in which a product orientation vs. a consumer relational view compromise quarterly performance to short-term metrics vs. long term return expectations engaging target market strategies, tactics, and budget performance evaluations Particularly, when both marketing and sales concerted efforts are cemented on customer-related activities rather than product-related ones (Homburg & Jensen, 2007).
Competence
Functional competence is associated with market knowledge about competitors and customers a typical marketing or sales employee possess. Competence is also related to the product knowledge of marketing or sales possessed by a typical sales or marketing employee about products and internal processes. Social skills are soft skills and are an addition to the hard skills of markets and product knowledge a typical employee possess to manage competitive challenges, and to communicate and persuade on the acquisition and retention of customers (Homburg & Jensen, 2007).
Let us recognize that market performance is measured by the attainment of superior metrics than those of competitors in customer satisfaction and loyalty, new customer acquisition, market share, and so forth. It is at this joint that integration as the quality of cooperation between marketing and sales would characterize unity of effort to achieve a common goal (Homburg & Jensen, 2007).
Integration
Integration is defined as the state of collaboration between departments to unify resources to meet the environmental demands (Lawrence & Lorsch, 1969). Marketing and sales cross functional leadership has demonstrated to manifest the varying degrees of influential power marketing and sales could have over the internal customer and across other internal functions. A CFR power imbalance has also shown to affect negatively marketing and sales relations, which makes attaining power equilibrium essential (Homburg, Workman, & Jensen, 2002; Workman, Homburgh, & Gruner, 1999).
External & Internal Change Impact on CFR
Environmental change associated with competitors, customer needs, technology, and market turbulence has been shown to affect the market performance of a firm whereas internal changes from variations in organizational structures, leadership, and strategy have been shown to affect cross-functional relationships (CFR) between marketing and sales (Homburg, Workman, & Jensen, 2002; Workman, Homburgh, & Gruner, 1999). A sample size of 337 firms was surveyed after conducting a pilot test with a draft of a questionnaire. The results indicated that thought-world-differences (competence and orientations) were offering both good and bad perspectives.
“They and We Culture”. The results from the exploratory hypotheses indicated that different orientations between marketing and sales had a positive effect on overall market performance, but different competences had a negative effect on overall market performance, proving this kind of diversity does make a difference (Homburg, Workman, & Jensen, 2002; Workman, Homburgh, & Gruner, 1999). Brooksbank, an associate professor-marketing at Waikato University Management School, asserted if marketers do not work at these divides they are in danger of maintaining a "them and us" culture and destroying a company's ability to effectively compete just by blaming each other for the lack of a company's performance (Brooksbank as cited in Moore, 2008, p.1).
The selling process today is a reflection of changing technology in the marketplace, says Bisset. "As we move through the new millennium, marketers and salespeople must continue to change" (Bisset as cited in Moore, 2008, p.1). But, is there a divide between the disciplines? Are today's marketers ignorant of what salespeople go through every working day - insensitive to the stresses attached to the possibility of rejection with every call they make? And will training in sales skills not only improve understanding between the two functions, but improve a company's bottom line? How about giving marketing some stake in the quarterly sales performance figures?
These rhetorical questions lead to recognize a divide between sales and marketing functions as long as a sales team’s tendency toward the short term with a bias to action remains and marketing with its eye on future trends continues with a biased tendency to analysis.
Moorman and Rust (1999) argue there is no need to abdicate marketing foci for a brand long-term development, its meaning, and its innovative strategies because without such planning sales will be selling air. However, devising sensible short-term strategies as future forecasting is unfolded could satisfy marketing’s role connecting the customer to the product, service delivery and financial accountability to support quarterly revenue demands on sales teams. Thus contributing to the perception of the firm’s financial performance, customer relationship performance and new product performance (Moorman & Rust, 1999).
Reconciling the Divide
Some of these steps could narrow a marketing–sales CFR gap and both functions leadership may stop seeing each other as mutually incompatible. After all, marketing’s future is not a function of the business but is the function of business as organizations extend marketing mix efforts across other functions reducing the specialty role of marketing leadership (Haeckel as cited in Moorman & Rust, 1999). This ideation suggests that the marketing function has value to an organization beyond the value achieved through the cross-functional dispersion of marketing activities. Horizontally designed organizations emphasize key business processes, which increases the cross-functional dispersion of marketing activities. Assuming a rational adaptation, Workman, Homburgh, and Gruner (1999) observed that it is more appropriate to have higher levels of functional dispersion in conditions of high market and technology-related uncertainty, industry sectors selling to business customers, smaller firms, and firms emphasizing differentiation but not low-cost strategies, in market-oriented firms, and firms with greater customer concentration.
Managerial Implication for the CFR Divide
PLC Stages
Regardless of the demand for marketing leadership and cross-functional influence under market growth conditions, and particularly during the introduction and growth product life cycle (PLC) stages of target market development when understanding customer needs, advertising, and promotion, and the expansion of distribution to reach new customers is most needed; such leadership is lost to finance and production during the maturity and decline stages and not to the sales group (Workman, Homburgh, & Gruner, 1999).
VUCA Times
During volatile, uncertain, ambiguous and complex (VUCA) times, marketing intelligence is sought out raising its level of influence and leadership in relation to sales. However, in times of rapid technological changes such influential leadership is lost to R&D and production teams and not to the sales group.
Differentiation and Cost Leadership
Core competencies for marketing strategic planning play a role in differentiation as in the STP model segmenting, targeting and positioning a brand. Whereas other functions like finance, production and sales play a leading role in cost-leadership strategies.
Distribution
In addition to strategic decisions about whether to sell directly or indirectly, business units also make decisions about how broad or narrow a customer base to serve. When the percentage of revenue comes from few accounts, sales and finance play a leading role in strategic decision decision-making while marketing plays a diminished role across the functions interacting with major accounts. Hence, marketing’s influence is reduced as customer concentration increases.
Cross-Functional Reporting.
Some firms have used a reporting structure that have contributed to the marketing and sale divide. Having sales reporting to finance and or to the strategic business unit (SBUs) director and not to marketing reduced marketing to a lead generator for the sales team thus debilitating marketing leadership over strategic market development. Having marketing report to the VP of sales, subordinates marketing to qualify as a rain maker, which marketing in the short term is not a player. Having sales and marketing to operate as separate strategic business units (SBUs) just increases competitive budget challenges rather than units integration. Having sales report to marketing with just accountability without authority has not proven effective in the long term.
Concluding Comments
Regarding, which function (sales or marketing) has a higher level of influence? Proving it will continue to promote a CFR divide. The result that emerged from Workman, Homburgh, and Gruner (1999) research data is that marketing and sales are relatively influential in comparison with each other. The cross functional engagement has reduced the domain of both functions. There is nothing worse than having different departments or different staff referring to the same product using several different names, different positioning or even different emphasis.
A top management team plays an important role in guiding strategic action in a firm, organizations are shaped by the backgrounds and beliefs of members of the top management team. Thus, consistent with prior research the leading conclusion hints that marketing's influence is higher in firms in which chief executive officers (CEOs) have a marketing background rather than a sales one. Particularly when the sales group reports to marketing leadership.
Corporate survival today is absolutely dependent on a world-class marketing and sales force, says William Bisset, "technology, competition and the economy are changing at a rate never seen before. A firm’s cross functional ability to learn and adapt faster than its competitors can be the key to a sustainable competitive advantage in today's marketplace" (Bisset as cited in Moore, 2008, p.3).
Please, share your views on this subject for the benefits of readers and follow up. Your comments are welcome and greatly appreciated!
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References
Homburg, C., Workman, J. P. Jr & Krohmer, K. (1999). Marketing's influence within the firm. Journal of Marketing 63(2), 1-17. Retrieved from the EBSCOhost database.
Homburg, C., Workman, J. P., & Jensen, O. (2002). A Configurational Perspective on Key Account Management. Journal of Marketing, 66(2), 38–60. https://doi.org/10.1509/jmkg.66.2.38.18471
Homburg, C., & Jensen O. (2007, July). The thought worlds of marketing and sales: Which differences make a difference? Journal of Marketing 71(3):124-142. doi: 10.1509/jmkg.71.3.124
Lawrence, P. R., & Lorsch, J. W. (1969). Developing organizations: Diagnosis and action. Reading, Mass: Addison-Wesley Publishing Company.
Moore, P. (2008). Sales: Crossing the divide. NZ Marketing Magazine, 27(10), 40–44.
Moorman, C., & Rust, R. T. (1999, Special Issue). The role of marketing. Journal of Marketing, 63, 180–197. doi:10.2307/1252111
Workman, John P., Homburg, C., & Gruner, K. (1999). Marketing Organization: An Integrative Framework of Dimensions and Determinants. Journal of Marketing, 62(3), 21–41. https://doi.org/10.2307/1251741