A Measure of Export Market Orientation - Case Study Example

Table of Contents Particulars Page No 1.0 Executive Summary 2 2.0 Introduction 3 3.0 Marketing Orientation 4 3.1 Customer Orientation 5 3.2 Competitor Orientation 6 3.3 Inter functional Co-ordination 7 3.4 Organizational Culture 7 3.5 Long term Creation of Shareholder Value 8 4.0 Recommendations 9 5.0 Conclusion 10 6.0 References 11 1.0 Executive Summary This report has been drafted in a comprehensive manner to focus on the topic “Marketing Orientation” and various components and its impact and influence on HSBC Bank. The report also looks to assess the effectiveness of marketing orientation and its five major components along with management recommendations on the same. The report initially through a through scanning of various academic literatures available looks to identify the real meaning of marketing orientation and how different components such as customer orientation, competitor orientation, long term shareholder value creation, inter functional co-ordination and organizational culture can have a positive and negative impact on the marketing orientation of HSBC Bank. Research identifies that HSBC has been able to deploy the concept of marketing orientation to much of its activities however there still exists gap which the organization need to re-consider by re-examining its marketing strategies and understand the effect of marketing orientation on its day to day business activities. Furthermore HSBC has to look to develop and focus more on customer orientation and competitor orientation as the company is functioning well to be able to maintain a good balance in its inter departmental issues and communication along with creation of long term value for its shareholders. In a nutshell the report has been drafted in a logical flow along with clear debate on positive and negative impact of marketing orientation and its components on HSBC to ensure that readers are equipped with both practical and theoretical understanding of the entire topic under study. 2.0 Introduction This report has been drafted in a business format which specifically looks to address to the Managing Director of HSBC Bank, a global bank being trusted and operated on a global basis. The report has been drafted to focus on the concept of marketing orientation and its number of components which includes customer orientation, competitor orientation, inter-functional co-ordination, organizational culture and long term focus of shareholder value creation. The report looks to present a combination of a sound theoretical and conceptual perspective with an appropriate debate being gathered from a list of academic literature available on the same and present management recommendations on the same to ensure a reflection of the various components and its importance of marketing orientation to HSBC Bank. Finally a conclusion is provided to ensure that the readers are equipped with both theoretical and practical understanding of the entire topic under study. 3.0 Marketing Orientation Marketing orientation is generally a long term philosophy of doing business and implementing the marketing concepts in the day to day activities of the business which puts customer needs and objectives at the central position of the organization. In terms of HSBC Bank the marketing concept starts with the very initial concept of customer satisfaction and needs as the top most banking function. The HSBC must completely scan the customer various and differing needs and wants and then make strategies accordingly to decide upon the satisfaction of those needs. The very objective to achieve banks objective shall in turn be met though a continuous effort of bank to determine its customer’s satisfaction. Recent studies have tried to collect empirical evidence in context to marketing orientation as to whether the adoption of the same leads to better performance of the firm in the marketplace. However, the way marketing orientation tends to conceptualized differs in their own ways as Hooley, Lynch and Shepherd tends to conceptualize the concept of marketing orientation as a set of specific beliefs which forms the basic component of a certain firms attitude or culture, Slater, & Narver, (2008) as well as Drysdale, 2009 explains the same as a certain behaviour. Narver and Slater further argue that behaviour and culture of any organization are interlinked. In line with the same we argue that marketing orientation provides HSBC the cultural framework from which learning orientation can be developed in a fast and steady manner. In line with Slater, Stanley F. & Narver, John. C. (2007) here we conceptualize HSBC as an organization whose culture is a dominant factor when examining the constructs of market orientation and organizational learning. Thus in a nutshell we argue that market orientation is the underlying set of organizational cultural values which helps in developing the learning orientation (Slater, Stanley F. & Narver, John. C. (2008) Having regards to the literature framework on market orientation it is important to look at the various components of market orientation through both theoretical and practical implication of the same on HSBC Bank which is discussed as under. According to Narvar and Slater, marketing orientation is composed of five basic behavioural characteristics or components which are as under. 3.1Customer Orientation Customer orientation is the first and most important component of marketing orientation as it is the most fundamental aspect of corporate culture. The concept of marketing is highly focused on the customer satisfaction which highlights the need of target customer interest being considered first. By placing the same as the highest priority it seeks to continuously find ways to provide customers with the best set of values and indirectly increases the organizations commitment towards excelling and maintaining the relationship with customers and thereby obtaining high performance and positive outcomes (Cadogan, Diamantopoulos, DeMortanges, 2009). One of the vital characteristics of customer orientation for HSBC is to demonstrate the understanding and commitment that the results are enhanced to create value for their clients. The key behavior of customer various factors such as providing excellent services which creates value, analyzing and researching the needs of customers, concentrating on those identified needs, committing on customers, complete focus on customer’s satisfaction, measuring and reporting such customer satisfaction and augmenting its existing services. Thus, HSBC Bank in order to focus on customer orientation should look to completely scan and analyze the behaviour of their clients or customers by use of research such as surveys, group focus interview and other tools and techniques which integrates customer’s voice to their expectation 3.2 Competitor Orientation Besides the customer orientation which looks towards the creation of superior customer value, competitor orientation is more inclined towards an effective strategy which exists in every business to gain competitive edge. It has been considerably argues that competitor orientation is more focused on understanding the strengths and weaknesses of both existing and potential rivals as well as discovering their attitude to develop better ideas which meets customers needs and lead to higher customer satisfaction. proposes a balanced mix of both customer and competitor orientation. In context to HSBC it should look to understand the altered market needs and adapt to the market dynamics caused by competitor orientation as the very objective of the same is to remain ahead of its rivals. Besides competitor orientation helps in arranging or planning a firm resource to provide maximal customer satisfaction and provide value to their products and services by carrying out research and investigating competitive, differentiated and distinctive approach. Competition from the viewpoint of customers and clients are whatever which satisfy their needs directly or indirectly. To understand the market HSBC should recognize that there is tough competition in the banking sector which could be used to their own advantage of setting up a benchmark against its rivals in terms of banking services and other quality programs and facilities offered by other banks as well as evaluate the offerings from other generic competition (Leisen, Lilly, Winsor, 2002). Key behaviour here includes discussion and external scanning of competitors, evaluating the competitor behaviour to market dynamics, examining competitor’s strategies and opportunities for improvement in future programs and developmental activities. 3.3 Inter functional Co-ordination Every organization works in an independent manner where different departs works in a synchronised and co-ordinated fashion to ensure the organizational goals and objectives are met. Inter functional co-ordination holds an important place in the concept of marketing orientation as it enables a firm to ensure that all available resources are directed towards the creation of value for its specific targeted audience. The key indicator of this component of marketing orientation is to ensure a total commitment of all the members of the organization (HSBC) to a marketing philosophy and further ensure integration of all marketing activities to provide high value to its clients and customers (Mcclure, 2010). Typically inter functional co-ordination in HSBC Bank should look to ensure the following characteristics or activities which includes different teams and departments working in a co-ordinated and synchronised manner to meet up customer needs and wants, teams and departments sharing the external and internal market information on a regular basis to ensure smooth and easy flow of all available information to every associated group connected with HSBC, integration of various strategies in different departments towards the accomplishment of one organizational objection which is to create value to its customers, all sections, teams and departments working together to offer and create maximum value to its customers and willingness of all team members among different section to share their resources. 3.4 Organizational Culture Organizational culture can enhance organizational performance by encouraging and motivating employees, unifying and shaping people around and guiding the employee behaviour (Daft, 2007). Research in the field of marketing orientation highlights that organizational culture help in providing a solid foundation for effectiveness, business competition and performance and excellence to the organization (Kriemadis et al., 2012). Organizational culture empowers and challenges organizations in today’s global competitive market. A culture which supports the strategic and organizational goals can effectively fuel performance and spark new innovations and differentiation within the workplace. However, if the culture opposes the policy the results can be much detrimental to the organization as organizational culture can be seen as an antecedent or precursor to organizational behaviour such as being market oriented and innovative having a deep impact on the new product development. For HSBC is of utmost important to link its employee and managerial behaviour to maximal customer satisfaction. Developing a culture with which the clients or customers are acquainted can help HSBC to develop a more loyal pool of customers on a long term basis and help grow business without boundaries. HSBC in context to the same should look towards more customer orientated programs and making a direct link between the managerial behaviour and its employees so as to ensure the best of its client services. 3.5 Long-term Creation of Shareholder Value Stakeholder’s theory suggests that a manufacturer’s ability to create superior value for its customers depends upon the relationship with its constituents groups (i.e. shareholders) (Milgrom & Roberts, 2010). HSBC normally has a long term five year plan claiming that the externalities of the environment are far beyond predictable after such duration of time. Despite this, research in marketing orientation reveals that HSBC should develop strategic plans and strategic intentions which go much beyond the normal life cycle of five years so as to create a long term value creation for its shareholders. There are certain behaviours which are associated with the same which HSBC needs to look upon which includes adopting to a long term shareholder focus in matters of expansion or survival of the business, attempting to service its varied range of customers like the shareholders, staffs, suppliers and so on. HSBC should further aim for effective organizational performance in the workplace and implement and identify new value added services for not just its customers but shareholders as well along with identifying and eliminating the deficiencies in its banking services. 4.0 Recommendations The report here addresses direct managerial implications in context to HSBC Bank. The study reveals that market orientation may or may not a desirable effect on any business as the same depends on the supply and demand side factors however, in case of HSBC Bank the same seems very positive for ensuring future sustainable development. Furthermore the qualitative research suggests that the attitudinal and the behavioural aspects of marketing orientation are interrelated. In broader sense it implies that the attitude of HSBC to consider marketing as a culture of satisfying consumer satisfaction needs and adopting and developing services and products as per those needs leads to specific actions which must be developed within the marketplace. On the other side, unless such an attitude is form such actions never emerge. Clearly banking companies like HSBC Bank which endeavour to understand the consumers and adapt their offerings to the needs of consumers gain in an added advantage of preference they enjoy in the market as potential suppliers. This preference is translated into not just better performance of the organization but also provides a benchmark to compare their performance achieved in terms of their competitors. The study further highlights that HSBC Bank can look to adopt an emergent approach to their organizational change and marketing strategies in order to become more market oriented. Furthermore the same in consistent with the Kelman’s theory to influence process and is in line with the proposition that an emergent approach or market back has a direct positive linkage with market orientation (Kohli, Jaworski & Kumar, 2013). HSBC managers shall in turn look to ensure a direct link between their marketing orientation strategies and learning orientation to ensure a better performance of their business and further gain an added advantage over their potential rivals with maximal customer satisfaction of needs and wants. HSBC Bank thereby should look towards developing positive strategies which will be aimed towards maximizing their chances of being successful by developing policies which are aimed at market orientation and developing strategies which will help them to be successful. 5.0 Conclusion Marketing concept is the base of marketing orientation. In order to be successful in a highly competitive banking environment, HSBC Bank should ensure better and superior value to its customers and other stakeholders when it comes to quality, prices and services. Marketing combination of management activities should look to adapt to the best possible ways to ensure fulfilment of consumer’s needs and wants and look to follow new organizational change. Furthermore there are sufficient researches and academic literature being elaborated in the report which suggests that market orientation can certainly improve HSBC business performance. HSBC although is becoming market orientated however there still exists certain gaps which needs to be fulfilled on a quicker pace. In a nutshell, it is important for HSBC to re-examine their marketing activities and make continuous efforts to understand the effect of marketing orientation on their business. 6.0 References Cadogan, J. W., Diamantopoulos, A., DeMortanges, C. P. (2009). A measure of export market orientation: scale development and cross-cultural validation. J. Int. Bus. Stud., 30: 689–707. Daft, R.L. (2007), Organization Theory and Design, 9th ed., South-Western, Cincinnati, OH. Drysdale, L. (2009) Marketing or Market Orientation: What’s the Difference, Prime Focus The Professional Journal for Australian Primary School Leaders April pp28-29 Kriemadis, T., Pelagidis, T., Kartakoullis, N. (2012). The role of Organizational culture in Greek businesses. Euro Med. J. Bus., 7 (2): 129-141. Kohli, A. K., Jaworski, B. J., & Kumar, A. (2013). MARKOR: A Measurement of Market Orientation. Journal of Marketing Research, XXX(November), pp. 467-477. Leisen, B., Lilly, B., Winsor, R. (2002). The effect of organizational culture and market orientation on the effectiveness of strategic marketing alliances. J. Serv. Mark., 16(3): 201-222.Milgrom, P. & Roberts, J. (2010). The economics of modern manufacturing technology, strategy, and organization. Am. Econ Rev., June, 30(3): 511-28. Mcclure, R.E. (2010). The influence of organizational culture and conflict on market orientation. J. Bus. Ind. Mark., 25(7): 514-524. Slater, Stanley F. & Narver, John. C. (2008). Customer-led and market-oriented: let's not confuse the two. Strategic Management Journal, 19 (10), 1001-1006. Slater, Stanley F. & Narver, John. C. (2007). Does Competitive Environment Moderate the Market Orientation-Performance Relationship? Journal of Marketing, 58(1), pp. 46-55. Read More