Effectiveness : The Effects of Organisational Structure , Resource Allocation and Strategic Type

According to the marketing literature and marketing textbooks, market research is required for successful marketing. However organisations differ in the way they both manage and resource their market research. This study hypothesised that market research effectiveness would be a function of internal research buying expertise, resource allocation and strategy. The research was conducted among a sample of 240 Australian marketing managers. Market research effectiveness was measured in terms of a) decision making support, b) contribution to marketing strategy, c) leveraging customer and competitor data, d) its ability to represent the "voice of the customer" and finally, e) bolstering the role of the marketing group and marketing manager within the organisation. The findings showed that having dedicated internpl market researchers and allocating internal and external resouroes to the research function enhanced market research effectiveness. It was also found that organisations with an entrepreneurial strategic orientation were more likely to see value in the market research function, with these organisations being less likely to use market research for intemal political purposes. Introduction The Australian market research industry, in the face of competition from other sources of business intelligence, is determined to demonstrate its usefulness for marketing decision makers. Recently, the Australian market research industry announced the formation of awards for market research effectiveness (AMSRS 2005). As market research is a co-produced service involving co-operation between supplier and client organisations, its effectiveness will depend on the technical quality of the research and also the client organisation and the structure of the internal market research function. Further, organisations with differing strategic intents should vary in the purpose, use and value derived from market research. For example, entrepreneurial organisations depend on identifying and exploiting opportunities and are therefore likely to be heavily reliant on research findings for their success. These entrepreneurial organisations are also likely to be active in scanning the external environment and in ensuring that the internal organisation hears the "voice of the customer". On the other hand, organisations operating in mature markets may have less need for market research, as would niche organisations, which rely on their specialist areas of expertise and intimate knowledge of customers. In summary, it would be expected that strategiC intent would affect the resources allocated to the structure of the market research function, the structure of the market research function itself and the value or effectiveness organisations judge the research to provide. In this paper, we will also consider whether strategic intent will have a greater influence on market research effectiveness than the market research function and/or the resources allocated to market research. Strategy and Market Research In terms of broad strategic intent, we examined two classical typologies devised by Miles and Snow (1978) and Porter (1980, 1985). Both were included in this study as Segev (1989) showed they subsume r.omplementary rather than entirely duplicated strategic dimensions. These typologies classify organisations or Australasian Journal of Market & Social Research I Volume 13, Number 2 December 2005 11