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Basics of Marketing - Kotler Philip

Program of the firm

The organization exists to achieve something within its environment. The specific goal or program of the firm is usually clear from the very beginning. However, over time, as the organization grows and new products and markets appear in it, the program may lose its clarity. Perhaps the program will remain clear, but will cease to interest part of the leadership. A. can, retaining the clarity, it will cease to meet the new environmental conditions.

Feeling that the company begins to swim by the will of the waves, the leadership should again look for the purpose. It's time to ask yourself: "What is our enterprise? Who are our customers? What is valuable for these customers? What will be our enterprise? How should it be? "These simple-looking questions are among the most difficult that the firm will ever have to answer. Successful firms constantly put them before themselves and give thoughtful, thorough answers.

Many companies, in response to these questions, develop official program statements in writing. A well-developed program statement allows the employees of the firm to feel themselves participants in the common cause in mastering the opportunities that are opening up, give them a goal, emphasize their significance, and aim at achievements.

The program statement should clearly indicate the scope (or scope) of the firm's activities. Determinants of the boundaries of areas of activity can serve as goods, technologies, customer groups, their needs or a combination of several factors. Firms usually characterize the spheres of their activity from the point of view of manufactured goods, for example: "We produce logarithmic rulers", or from the point of view of technology: "We are a chemical company". Several years ago, Theodore Levitt stated that, in his opinion, the characteristics of an enterprise from the side of market activity turned out to be more accurate and complete than its characteristics from a commodity or technological point of view. He argues that the company should be looked at as a satisfying customer's needs and requests, and not as a producer of certain goods. Goods and technologies eventually become obsolete, while the basic needs and demands of the market can remain unchanged forever. So, the manufacturer of logarithmic rulers will go bankrupt shortly after the appearance of electronic calculators on the market if it considers its occupation as the production of logarithmic rulers, and not as the satisfaction of human needs in the production of calculations. A policy statement from a market orientation position defines an enterprise from the point of view of its activity in servicing specific groups of consumers and / or the satisfaction of specific needs and requests.

When developing a program statement of market orientation, management should strive to ensure that the program does not turn out to be too narrow or too broad. The manufacturer of graphite pencils, declaring that he is engaged in the production of means of communication, formulates his program too widely. In this case, it is useful to push off the existing product in the direction of commercial opportunities of a higher level and decide which ones are practically suitable for the firm. In Fig. 85 shows the development options of the company making prunes. It can view itself as a producer of dried fruit, as a fruit company and, finally, as a food company. Accordingly, it can present itself as a manufacturer of laxatives or, ultimately, a pharmaceutical company. Each stage of the expansion introduces new opportunities, but it can also push the company into risky steps that are not tied to reality, not backed up by its capabilities.