Marketing is one of the most interesting and challenging subject to be studied. In either undergraduate or graduate degree, it does make any difference. Likewise, in this paper a subject of being market orientation is being discussed. According to many experts and studies, there is no clear cut definition to Market Orientation. The reason is that the term is very broad and subjective due to its practices and sophisticated world of human. However, there are still basic criterion for such term.
And such criterion are like being responsive to knowledge of the market, understanding of customers’ needs and wants, and more as discussed inside this paper. In fact, this paper has brought up quite a few ideas from different experts concerning what the basic criterion should be. To make the matter more interesting, inside this paper there is analysis between real subject and the concept presented by the experts in this field of marketing. The subject of this paper happens to be a commercial bank operating in Cambodia, and it is pretty well-known for its aggressive marketing strategy.
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Last but not least, there is also recommendation given in the last section of this paper as well. Recommendation is given based on the weakness found in analysis section, and it could be either for the concept of the experts themselves or the subject of this study. Acknowledgement First and foremost, I would like to thank to my instructor of this subject, Mr.. Arrive for his effort, valuable guidance, and time. His effort and understanding have made it easy for me to get this assignment done in the name of academic achievement.
Moreover, such assignment of his has pushed me to another level of becoming a better student and better employee. Besides, I also would like to thank to CAB staffs and CAB Bank, which is the subject of y study later on in this paper, for giving me the opportunity to understand about bank and making it very convenient for me to conduct my research for this assignment. Last but not least, I would also like to thank to my beloved parent for giving me support financially and mentally on daily basis. Their unconditional love and cares have Just never been exhausted for me.
Likewise, a very big thank is also given to my lovely fiance©e. Table of Content I. Executive Summary Market Orientation By Arranges ill. Table of Content Apart : Introduction 1 . Objective of Report Apart: Finding Apart: Analysis Apart: Conclusion Apart: Recommendation lb. References Part 1: Introduction So far, by looking at the history of business world it is very obvious that there has always been up and down in terms of growth. Some start from scratch and become a giant corporation, and some are quite unfortunate and collapse in a number years.
All these matters have been well remembered, documented, and used as a guide for later generation. In fact, many studies and arguments have been conducted and come up with lots of factors that are believed to be the causes of the failure or success. Mostly, the end result often points to goodness or badness of financing, corporation structure, fraudulence, or management strategy. The result is quite convincing. Yet, the only one that seems to be the very problem needed to be primarily looked at is the management strategy.
Management strategy is so important that it deals with the broad aims and policies of the each firm. It, in fact, is the very few activities that could bring competitive advantage over the competitors. Actually, management strategy could come in as many forms and pictures. It is up to the individual firms to decide. Since the main focus of this paper is marketing strategy; as a result, “Market Orientation” as management strategy will be used as the topic for further discussion in this paper. To some very well-educated people like Proof. Theodore Levity, Glen L.
Urban, and John R. Hauser, Market Orientation as a management strategy is one of the best way to keep an organization moving forward and making profit. Then, the question is raised, what exactly is “Market Orientation”? Simply, Market Orientation means seeking and understanding consumer needs, focusing more on consumer rather than product or service, embracing changes which ultimately benefit consumers, and thinking as well as seeing in terms of the whole industry rather than being too unambiguous. In case the key concept has not consumer benefits for now and in the future.
To make the matter more interesting, a small study is conducted on a bank, called Angora Capital Bank, in Cambodia. This bank is a commercial bank providing common services like deposit, loan, overdraft, and so on to many different type of consumers. It is owned by a group of American investors and has Just officially opened recently _ late 2008. It has promised the public with innovative products and better quality that make the customers and the bank itself grow together. 1 . Objectives of report: 1 . Introducing the concept of Market Orientation 2.
Establish relationship between Market Orientation and Profitability 3. Creating basic criteria of being Market Orientation 4. Putting Marketing Orientation concept into real practice by using a bank as a subject of study Part 2: Finding Twenty first century has brought so much to the world history. Technology, events, knowledge, and world economy have changed dramatically, not to mention the impact of globalization. Likewise, people around the world, either developed or less developed countries, are also trying passionately to cope with every bit of the changes.
The truth behind this fact is that everyone understand that this is the key to survival, and there are hidden golden opportunity, behind all these changes, could be exploited and make people better off. As a result of all these, everything is getting more complex and sophisticated. If talking about the field of marketing, this means customers have become more knowledgeable and smarter, and market is harder to be pleased. At the same time, the demand for more variety and better quality is eating greater.
Combining all these facts together, it means the effective strategies are in great demand, especially the more specific and consumer-base strategy. Then, there come the concept of Market Orientation and Product Orientation. Talking about the Product Oriented Strategy, it is quite understandable Just by looking at the term itself. Product Oriented strategy is merely referred to the fact that product come first. The firm knows best. The firms that practice Product Oriented strategy commonly look at how its product, in the market, is producing income for the firm. Getting rid of the product is necessary.
Simply, the picture is this: The diagram simply points to the idea that, for firms, practicing product oriented strategy, mostly get obsessed with the product itself. Such firms tend to believe in the production of scale, superiority of the product, continuous growth of the market should be borne in mind that there is consequence for this. As proven by the history of many businesses, the nature of creativity, innovation, long term sustainability, and so on are disappeared after times for such organization. As the result, many had lost their shares to the competitor or newly emerging businesses as well as industries.
On the other hand, Market Oriented strategy is so much different from the concept of production orientation mentioned earlier. The concept of Market Orientation has been well studied by many researchers. As to Kohl’ and Gasworks, Market Orientation is about paying balance attention to both customers and competitors. (Leaflets, BAA & Hull, GET 2001, “A synthesis of contemporary market orientation perspective”) For others like Theodore Levity, Market Orientation is about adapting to the requirement of the market, and it has to be done sooner rather than later _ not Just experiencing and carelessly enjoying the sweet smell of success.
Levity, T 1970, ‘Marketing myopia’) To many researchers, there are still plenty of researches needed to be done, as they still believe that there is no clear cut definition of the this concept yet due to its application as well as implementation in business, not to mention the evolution of ways of doing business. However, more or less still there are basic criteria for organization to follow. To get the basic criteria of this concept, the concept itself must be broken down into basic understandable explanation. Actually, the concept itself contains the need of information for decision making.
The need for the company to understand its markets, customers as well as competitors and allow such information to permeate every corporate function is essential in adapting the market orientation strategy. (Leaflets, BAA & Hull, GET 2001 , ‘A synthesis of contemporary market orientation perspectives’) In this sense, it points out to the need of working together as a whole and toward the same goal, so that more or less every parts of the firm to a certain degree is on the same track and take part in helping to define and understand both the current and potential market for the firm.
Then, any decision to e made should be openly and honestly coming from different corporate functions in spite of the different modes of operation. To achieve that, it is wise for any involving corporate functions to recognize their differences and be willing to utilize an open decision-making process. (Leaflets, BAA & Hull, GET 2001, ‘A synthesis of contemporary market orientation perspectives’) On top of that, there is also an urge for commitment from the inside-out in communication and coordination in order to capture the market opportunity.
Mainly, the thing is that being market oriented is to have an organizational decision-making process committed by the management to share information interdepartmentally with the aim of getting better understanding of the market, where there are consumers and competitors. And the term for this one is “Decision-making perspective”. After initiating the organization wide awareness, it is time to feed the information to all those departments. To Kohl’ and Gasworks, the very first step in this stage is called “Intelligence Generation”. Leaflets, BAA & Hull, GET 2001, ‘A synthesis of contemporary market orientation perspectives’) This intelligence enervation highlights the concept of monitoring competitors’ action and their effect on customer preferences as well as other effect incurred by other external factors like government regulation, technology, and environmental issues. Both current and consistent with the first criteria mentioned in the previous paragraph, this intelligence generation requires the involvement from every functional department in the organization.
Again, as to Kohl and Gasworks, this leads to the second step in the stage which is “Intelligence Dissemination”. According to these two names, Part of he organization ability to adapt to market needs is how effectively it communicates and disseminates market intelligence among the functional areas. (Leaflets, BAA & Hull, GET 2001 , ‘A synthesis of contemporary market orientation perspectives’) Simply, this intelligence dissemination serves the purpose of producing greater power to what the firm or organization trying to do.
Last but not least, the final step in this stage is to be responsive to the two steps mentioned Just now. Being responsive in this sense refers to the fact that appropriate action should be taken afterward, like electing appropriate target markets, designing, producing, promoting and distributing products that meet current and anticipated needs in the market. Overall, these three steps of being market oriented create another basic criterion called “Market Intelligence Perspective”.
Another possible criterion of market orientation is the “Culturally based Behavioral Perspective”. In simple explanation, this criterion is looking at the behavior of the both customers and competitors. The customer are mainly being studied in terms of the needs, both current and potential needs; whereas, the competitors are being tidied in terms of strengths and weaknesses. That includes its technology capability, strategies, and so on. Besides, according to Nearer and Slater there is another component to this criterion, “International Coordination”. Leaflets, BAA & Hull, GET 2001, ‘A synthesis of contemporary market orientation perspectives’) In fact, it is not really that different from what we have explained so far. It is the coordinated utilization of organization’s resource in creating superior value. So far, it has been mostly about the basic criteria of market orientation in terms of “what to do” and “who to do”. It looks like it has been mostly in the execution part. Now, the attention should be turned into new direction or the earlier part of the management tasks.
Creating organizational wide effort in understanding the market is part of the market orientation, yet having strategy or doing strategic planning dedicated to customers wants and needs is quite another proof of being market oriented. According to the Request, the level of market orientation in a business unit is the degree to which the business unit obtains and utilizes information from customers, develops a strategy which will meet customers’ needs and wants, and implements that strategy by being responsive to customers’ needs and wants.
Last but not least, the possible basic criteria of being market oriented is the “Customer Orientation Perspective”. Based on Deckhands, customer orientation is the set of beliefs that puts the customers interest first, while not excluding those of all other stakeholders, managers, employees, owners, and others in order to have a long term profitable enterprise. In fact, to be more specific the terms would be profitable and sustainable enterprise. To make the matter more interesting, this paper has selected a bank in order to study TTS approaches in terms of being market oriented.
In doing so, it would help to demonstrate how different the concept in the book and real practice is. Later, it would as well help to give a better and clearer picture of what a market orientation is, including recommendation to either the real practices or the conception in the book. Of course, the basic criterion discussed earlier in this paper will be used as the base of this analysis. Singapore Banking Corporation Limited (CBS Bank) is one of among the most outstanding commercial bank in Cambodia. It has been operating in Cambodia for more than 10 years.
Having had more than 5 branches located in every major cities and town in Cambodia, CBS bank is offering employment over a couple hundred to Cambodia. Shareholders are both local and international investors having very good reputation in such field. CBS bank has been working as well as helping Cambodia through good and bad time, and it has now earned a lot of respect and public reputation among Cambodia individual and commercial customers. Sob’s corporate value is ‘Teamwork, Respect, Unity, Motivation, and Professionalism’, and it has a vision to be inform Preferred and Trusted Partner in Banking”.
Talking about marketing field, CBS is obviously one among the most well known banks for having aggressive marketing strategy in Cambodia. Yet, it still no certain if it is market oriented or else. For now, it is up to the first basic criteria discussed previously, Decision Making Perspective. It is known that marketing team at CBS always comes up with different ideas of doing marketing every year, giving away free stuffs, promotions, contests, new technology, and so on. It seems like there is a whole lot of information has been gathered and given to the team regarding to need to do all these activities.
Unfortunately, the fact of the matter is not what it seems to be. Of course, marketing department is aware of the fact that it needs to serve the market or people in order to keep the people coming. However, for all the marketing activities and strategies are mostly coming from the gut and following examples from either local competitors or other banks outside Cambodia. According to Shapiro (1988), it is far more than the click© getting close to the customer the term market oriented represents a set of processes touching all aspects of the company. For what the market department at CBS is doing is to only get close to customers.
Yet, it does that all by itself and sometimes of course with a few people from the top management. This includes gathering information, determining target market, making strategic planning, as well as making decision. That means CBS is trying to do marketing, yet it is not doing marketing orientation. Base on Shapiro concept, of course only a few people can conduct marketing, but to do market orientation or be market oriented it requires the whole organization as the market itself as well as its characteristic is complex, demanding, evolving, huge, sophisticated, and opportunistic.
Therefore, each and every bite of its intelligence from every corner is Secondly, Just now it seems that CBS is quite apart from being market oriented according to Shapiro. However, there is still second criteria to be looked at. According to another expert in this field, Market orientation is the organization-wide generation of market intelligence pertaining to current and future customer needs, dissemination of the intelligence across departments, and organization-wide responsiveness to it (Kohl and Gasworks, 1990).
Looking at what CBS is doing, it is certain that there is to some degrees generation of market intelligence. CBS sure has always been monitoring its competitors and keen at meeting, studying, and discussing with customers. And surprisingly, it is every responsive to the information. For example, about two or three years ago ANZA royal, part of an internationally well known bank ANZA group, had made ATM an urban miracle in Cambodia. People started to get excited about having this ATM card and using it at public places. And that made ANZA Royal a good public reorganization ever since.
Not for long, after realizing the success of ANZA Royal CBS had ordered a number of ATM to be set up almost at all of its branches all over Cambodia. However, still CBS cannot cover the whole criteria. CBS does not have the characteristic of intelligence dissemination. Thirdly, it is the behavior perspective of organization trying to be customer oriented. By looking at the previous behavior of CBS and other explanation from the management themselves, it is clear that CBS is really trying to take care of the customers, improving service and other convenience, and not taking its competitors for granted.
Mentioned previously, The ATM is a good example in this case as it helps providing convenience, keeping CBS up to the challenge, satisfying customer for both owe and the future, as well as quick realization of the market needs and threat from competitor. Moreover, CBS is one among a few that firstly introduces Credit Card not only to foreigner and rich people in Cambodia, but to middle and working class people in Cambodia. And it does work, like buying goods from the internet, getting goods first and paying later, and so on.
And that is quite a new and exciting experience as well as convenience to the market. However, as in this criterion Nearer and Slater (1990) point out another essential key in being market oriented; it is being international coordination. Again, it does not work with CBS for the time being. As usual, it is limited to the Marketing Department and a few managements that do all the works. Somehow, it is hard to say that CBS is not being market oriented. Judging from the a few instances above, CBS does quite a good Job in the name of market orientation.
It is Just that it is not really deeply into the concept proposed by the experts. To get a better view of what CBS really is, strategic focus perspective is another criterion that should be looked at. According to Request (1992), the level of market orientation in a business unit is the degree to which the business unit obtains and sees information from customers, develops a strategy which will meet customer needs, and implements that strategy by being responsive to customer needs and wants.
As the matter of fact, this one is not really different from the second criteria customers’ needs and benefits and being responsive to the information and knowledge obtained. Yet, the major difference is the mentioning of strategic planning. Request is focusing the strategic management or a few specific activities that should be enforced by the management and dedicated to customers’ needs and benefit. And for that, CBS does not have. The fact of the matter is that in Cambodia, policy and corporate governance is not up to the standard yet.
Most of the time, there is strategy yet it is in the mind of the management or a few pages of minutes of meeting. There is no clear cut instruction, policy, or strategy written in order to make sure it is there for everyone to understand or followed. And it is subject to change at any times. It is another improvement required not only by this sector, but most of the industries in Cambodia. Part 4: Conclusion According to examples and analysis above, for sure there is still uncertainty in saying hat CBS is either not market oriented or the other way around.
Yet, it is clear that CBS is trying hard to succeed in its own way which is somehow close to what experts call market orientation. In fact, according to the analysis CBS has been covering most of the points in the basic criterion mentioned earlier in this paper. Customer needs and wants, understanding competitors, and being responsive to the changes and knowledge about the market are already there in CBS. There is only one thing missing, organization wide cooperation.
All in all, at least it should be very safe to say hat CBS is close to being market oriented and still moving toward to become on very soon with a few improvement. Part 5: Recommendation As mentioned Just now, there are two points that CBS should be taking care of in order to improve its performance and be a real market oriented organization: – Organization wide effort: Firstly, the information on all important turnover influence should be permeated every corporate function.
Besides, strategic and tactical decision are made internationally and internationally. Not to mention, division and functions make well-coordinated decisions and execute them with a ensue of commitments. It is also helpful to understand all these should be done in spite of potentially conflicting objectives that mirror differences in modes of operation. Recognition of the differences and be willing to utilize an open decision- making process is the key.
In short, being market orientation is not the exclusive responsibility of the marketing department. – Proper policy and regulation: Good corporate governance has always been believed to be the key to successful story of many giant corporations. That is why setting a good culture in an organization is crucial. Culture of having respect for each there in spite of the differences between modes of operation is one example. Setting another good example needed to be followed.
And there are more to learn and have in good corporate governance. Therefore, in order to make itself a successful organization as well as having successful marketing strategy, strong and good corporate governance is the primary step among the others to be taken.