Christine Moorman & George S.

Day

Organizing for Marketing Excellence

Marketing organization is the interface of the rm with its markets and where the work of marketing gets done. This
review of the past 25 years of scholarship on marketing organization examines the individual and integrative roles of
four elements of marketing organizationcapabilities, conguration (including structure, metrics, and incentives),
culture, and the human capital of marketing leadership and talent. The authors indicate that these four elements are
mobilized through seven marketing activities (7As) that occur during the marketing strategy process. These activities
enable the rm to anticipate market changes, adapt the strategy to stay ahead of competition, align the organization to
the strategy and market, activate effective implementation, ensure accountability for results, attract resources,
and manage marketing assets. How well the rm manages these seven activities throughout the marketing strategy
process determines the performance payoffs from marketing organization. Future research priorities outlined for the
elements of marketing organization, their integration, and their impact on the 7As offer directions for the study of
organizing for marketing excellence.

Keywords: marketing organization, capabilities, structure, culture, marketing leaders, marketing talent, marketing
metrics, marketing strategy, rm performance

Online Supplement: http://dx.doi.org/10.1509/jm.15.0423

ver the past 25 years, there has been much progress in human capital, and culturethat play the most important role

O understanding the sources and benets of marketing

excellence. However, advances in knowledge are
barely keeping up with profound transformations in practice
enabled by the digitization of marketing activities, the emer-
gence of deep marketing analytics, and the evolution toward
more open, networked organizational structures. As the Mar-
keting Science Institute priorities (2014, p. 7) summarize, In
a rapidly changing world virtually all marketers are reevalu-
ating how they should do marketing. Different structures, new
processeseverything is on the table.
Marketing excellence is a superior ability to perform
essential customer-facing activities that improve cus-
tomer, nancial, stock market, and societal outcomes.
Marketing organization plays a foundational role in the
achievement of marketing excellence. In this article, we
assess the state of scholarship on marketing organization
and identify the most promising directions for future
research to provide deeper contributions from these often
unheralded elements.
We focus on four elements of marketing organization, col-
lectively referred to as MARKORGcapabilities, conguration,
Christine Moorman is T. Austin Finch, Sr. Professor of Business Admin-
istration, Fuqua School of Business, Duke University (e-mail: moorman@
duke.edu). George S. Day is Geoffrey T. Boisi Professor, The Wharton
School, University of Pennsylvania (e-mail: dayg@wharton.upenn.edu).
The authors thank the participants at the Frontiers of Marketing con-
ference at the Marketing Science Institute and conference discussant
Brennan Dell (Dell Computer), the JM review team and Neil Morgan for
comments on a previous version of this article, Marketing Science
Institute Executive Directors Kay Lemon and Kevin Keller for supporting this
initiative, Ed Holub and Sarah Memmi for editorial support, and Honggi Lee
for bibliographic assistance.
in marketing excellence. We show how these four elements are
mobilized through seven marketing activities (7As) that occur
during the marketing strategy process. How well these seven
activities are managed throughout the marketing strategy
process determines the performance payoffs from marketing
organization.
This view emerges from a review of the literature from
1990 to 2015 in Journal of Marketing, Journal of Marketing
Research, and Marketing Science, supplemented by relevant
work in strategic management and other marketing jour-
nals. We begin with a review of research ndings on each
MARKORG (see Tables W1W4 in the Web Appendix).
First is a rms marketing capabilities, which are the complex
bundles of rm-level skills and knowledge that carry out
marketing tasks and rm adaptation to marketplace changes.
Second, marketing conguration comprises the organiza-
tional structures, metrics, and incentives/control systems that
shape marketing activities. Third, marketing leaders and em-
ployees are the human capital that creates, implements, and
evaluates a rms strategy. Fourth, by creating values, norms,
and behaviors that facilitate a focus on the market over time,
culture guides thinking and actions throughout the rm. Fol-
lowing our review, we identify future research priorities for
each MARKORG element (see Table 1) and their integration.
Figure 1 is a road map of our article. We show that
MARKORG facilitates marketing excellence through its
inuence on the seven key marketing activities (the 7As) in
the marketing strategy processanticipation, adaptation,
alignment, activation, accountability, attraction, and asset
management. Following the literature, the 7As are actionable
meditating mechanisms through which the more intangible
MARKORG exerts its inuence on rm performance. We
also observe that the connection between marketing organization

2016, American Marketing Association Journal of Marketing: AMA/MSI Special Issue

ISSN: 0022-2429 (print) Vol. 80 (November 2016), 635
1547-7185 (electronic) 6 DOI: 10.1509/jm.15.0423

Research Questions
Marketing Capabilities for
Marketing Excellence
What are marketing
capabilities?
How are marketing capabilities
measured?
What is the contribution of
marketing capabilities to rm
performance?
How are superior marketing
capabilities developed?
How are marketing capabilities
changed?
Marketing Conguration for
Marketing Excellence:
Organizational Structure
Does the marketing function
contribute to rm
performance?
How does the marketing
function contribute to rm
performance?
How is the marketing
organization aligned with
rm strategy and market?
Organizing for Marketing Excellence / 7
TABLE 1
Marketing Organization: Research Questions and Future Research Priorities
Future Research Priorities
What is the nature of new capabilities in digital marketing, social media, and marketing analytics?
What is the nature of capabilities for developing market-based assets?
How are lower-level capabilities related to higher-level capabilities?
Does marketing lead marketing capabilities?
What are the comparative strengths and weaknesses of the ve different capability measurement approaches?
Do measures of marketing capabilities triangulate?
How do marketing leaders measure marketing capabilities?
What are the relative performance effects of different marketing capabilities?
What inuences the diminishing returns of market orientation and how do late adopters learn from early adopters?
What are the short-term and long-term effects of marketing capabilities on rm performance?
How do marketing capabilities inuence performance?
Under what conditions do capabilities become complements or substitutes and how do rms vary in the ability to create complementarities?
How do rms decide which knowledge and skills are important and how much are they driven by rm objectives, competitors actions, or
consultants advice?
How do rms use training to build capabilities?
How do rms build marketing capabilities by partnering?
Can marketing capabilities be protected from rivals?
How does a rm change marketing capabilities and the required resource congurations to move from ofine to online marketing or from
traditional to digital advertising?
Are the contributions of the marketing function to rm performance generalizable to businesses in developed and emerging economies and
to businesses of all sizes and sectors?
Do managers across different functions rate marketings contributions similarly to the way marketers rate their own contributions?
Is there an integrative framework that explains marketing functions contributions to rm performance?
What explains the different growth rates for marketing department power? Are there natural inection points in the process that reect
growth opportunities for marketing, such as rm entry into new markets or the hiring of a new marketing leader into the company?
As different parts of the organization assume market-focused activities, how does a strong marketing department hold its center?
How do intermediate organizational structure characteristics and specic types of marketing strategies inuence the alignment of marketing
organization with strategy and market?
How does organizational structure in marketing change over time?
How do rms build scalable, global resources and capabilities that can be adapted for local markets?

Research Questions
What are the role and impact of
marketing in cross-
functional relationships?
How should rms organize and
coordinate marketing and
sales?
Does outsourcing marketing
affect rm performance?
Does a customer-based
organizational structure
affect rm performance?
8 / Journal of Marketing: AMA/MSI Special Issue, November 2016
Marketing Conguration for
Marketing Excellence:
Metrics Use
What metrics do rms utilize?
Does the use of metrics
contribute to rm
performance?
What factors inuence use of
metrics in rms?
TABLE 1
Continued
Future Research Priorities
Why is marketings cross-functional role so mixed? Does research account for coopetition, the impact at each stage of the process, and the
use of informants from different functions?
As organizations perform more work using electronic tools and geographically dispersed teams, how will these new cross-functional
structures affect marketings contributions?
How should digital and data specialists be integrated with marketing and with other functions of the rm? What structures facilitate optimal
decision making so that these technical specialties help the company serve its customers more protably and not serve the specialties
focused interests?
How should marketing and sales cooperate across the solution funnel?
How do marketing and sales cooperate effectively using these new digital and omnichannel strategies?
What are the most effective leadership strategies for coordinating marketing and sales?
What is the impact of outsourcing marketing activities on rm performance?
What structural, legal, and relational approaches are most effective in managing high-dependency partnerships for new skills in social
media and digital?
How does outsourcing as cocreation affect the novelty, speed, and effectiveness of marketing strategies?
How do rms protect their strategies and knowledge from spilling over to competitors when outsourcing?
How does the transition from a product structure to a customer structure inuence rm performance?
What is the most effective approach to transition to a customer-based organizational structure?
What is the impact of rm, industry, leader, and strategy factors in the transition to a customer-based structure?
As marketing embraces digital, social, and mobile strategies, are traditional metrics being replaced by more sensitive process measures
that can be observed online (e.g., referrals)?
Do rms use metrics that evaluate the speed of cash ows?
Do rms use metrics related to stock market performance?
How are metrics used in combination to make marketing decisions?
Are observational studies of managers using metrics different from managers self-reports of metrics use?
How does metrics use inuence the nature and effectiveness of individual marketing decision making?
How do the most effective managers use metrics?
Do metric qualities (i.e., evaluative or diagnostic, short-term or long-term, and using objective or subjective information) moderate the
impact of metrics use on the quality of individual decisions?
What are the costs and benets of breadth versus focus in metrics use?
What is the ROI in building dashboards and training managers to use them?
Considering the dashboard, which metrics are most useful to have on a continuous basis and which are better evaluated less frequently?
What number and sequence of metrics is optimal?
How does rm strategy inuence the type and level of metrics use?
What individual marketing leader and employee characteristics inuence metrics use?
What types of top management team (TMT) dynamics facilitate metrics use? Do metrics get used more when TMTs display a mix of cooperative
and competitive dynamics?
What is the process by which metrics are adopted within companies?

Research Questions
Marketing Conguration for
Marketing Excellence:
Incentives and Controls
How do marketers
misbehave?
How should marketing agents
be aligned for rm
performance?
Human Capital for Marketing
Excellence: Marketing
Leaders
Do marketing leaders improve
rm performance?
What inuences marketing
leader effectiveness?
How do marketing leaders
improve rm performance?
What inuences the
appointment of marketing
leaders?
What is the marketing leader
turnover rate and what
factors inuence it?
Human Capital for Marketing
Excellence: Marketing
Leaders
Do marketing employee
knowledge and experience
contribute to rm
performance?
Organizing for Marketing Excellence / 9
TABLE 1
Continued
Future Research Priorities
What methods offer an accurate and complete view of marketer misbehaviors in different roles?
What best predicts marketer misbehavior among alternative explanations in the extant literature?
How do different incentive and control systems relate to one another, including whether they substitute, detract from, or complement one
another?
Does aligning incentives with customer metrics (e.g., customer retention) reduce misbehavior?
How do incentive and control systems work when marketing occurs in open network structures where responsibilities are diffused?
Which incentives and controls should vary across markets and which should hold at standardized levels throughout the company?
How do some marketers and their rms resist the forces of self-interest? With what consequences both over the short and long run?
Does the presence of a CMO inuence the value of a rms market-based assets, including customer equity, brand equity, and knowledge?
Does the presence of a CMO in the TMT affect rm risk levels?
Does the presence of a CMO in the TMT play a critical defensive role in protecting rm cash ows from external threats?
What is the effect of organizational moderators associated with structure and culture on the CMOrm performance link?
How do CMOs leverage their education and experience to inuence rm performance?
How does a CMOs relationships with other C-suite members inuence CMO contributions, and what CMO characteristics, roles, and
actions make for successful long-term relationships?
What activities do marketing leaders perform that inuence rm outcomes? How much do these activities contribute to rm performance
when managed by marketing leaders versus other areas of the rm?
What conguration of job description elements offers the greatest prospect for CMO performance impact?
Why is growth delegated to nonmarketing leaders and with what effect? How does growth strategy change when managed by a marketing
leader?
How does the match or t between marketing leader characteristics and experiences and rm characteristics, strategies, and aspirations
inuence marketing leader appointment?
What inuences the appointment of marketing leaders to roles including designations for sales, customer, brand, or growth, or
adjectives such as Chief, Executive, or Senior Executive?
What is the true rate of marketing leader turnover and how does this compare with other rm leaders?
How is CMO turnover inuenced by rm performance changes, deviations from expected rm performance changes, and competitive rivalry?
How is turnover inuenced by the various roles played and activities enacted by the CMO?
How does the t or match between individual marketing leader characteristics and rm objectives or strategy inuence turnover rates?
What skills does the marketer of the future need?
What research approaches and tools should be used to isolate the effect of marketing knowledge and experience?
Can we link individual marketing knowledge and experience to rm performance?

Research Questions
What is the impact of
marketing training?
How does the management of
frontline employees (FLEs)
affect customers and rm
performance?
What is the impact of employee
satisfaction on rm
performance?
10 / Journal of Marketing: AMA/MSI Special Issue, November 2016
Organizational Culture for
Marketing Excellence
How has organizational culture
been studied in marketing?
How is organizational culture
measured in marketing?
What is the contribution of
culture to rm performance?
How should rms build and
sustain a market-oriented
culture?
TABLE 1
Continued
Future Research Priorities
What training tools (in person, computer-mediated, gamication, etc.) and training modes (experiential, case-based, lecture, etc.) work best
in what situations and for which marketing employees?
What individual factors moderate the effect of marketing training?
How does training affect outcomes such as sales force hiring and turnover?
How do strategies reecting different psychological, organizational, economic, and structural mechanisms work together to inuence FLE
performance?
What role does the rms top marketing leader play in FLEcustomer interactions?
Is it employee satisfaction or the type of employee who is attracted to work for a certain type of rm that is responsible for the FLEperformance effect?
Does employee satisfaction inuence extra-role and stewardship behaviors, burnout, and customer informationsharing behaviors?
Are employees more satised when they work for a rm with a strong brand? Does satisfaction inspired by brand produce different
behaviors than satisfaction inspired by connection to a specic job or to the larger rm culture?
What additional cultural values, behaviors, and artifacts play important roles in marketing strategies?
What is the nature of a rms market-based assetfocused culture?
Can text analysis be used to measure organizational culture?
What novel artifact-based measures of culture should be developed in the eld?
Does the de-emphasis on competitor orientation endanger or facilitate performance effects of a market-oriented culture?
Does culture create market-based assets?
How does a market-oriented culture serve both its business-to-business partners and its ultimate end customers?
Can research separate the performance impact of culture from the contributions of rm leaders and rm strategy?
How do marketing leaders shape culture?
What is the emergent nature of cultural change? What begins the process and what are the mechanisms?
How is the rms culture built from the enactment of marketing activities?
 FIGURE 1
Marketing Organization and Firm Performance
Four Elements of Marketing
Organization (MARKORG)
Culture
Configuration
Structure
Capabilities
Metrics use
Incentives/controls
Assessing
Accountability
(Human)
Capital
Leaders
Employees
Direct effect
Feedback effect
and these activities is underdeveloped, which suggests future
research opportunities.
Although the core of the model in Figure 1 is the
MARKORG 7As rm performance path, we show
additional linkages to capture the dynamic and iterative
nature of the process. For example, although the effec-
tiveness of MARKORG can enable or constrain the 7As,
there is also an important learn by doing feedback loop
in which the successful (unsuccessful) deployment of the
7As leads to strengthening (weakening) MARKORG. Positive
feedback from performance outcomes nourishes MARKORG
through reinvestment and afrmation; conversely, negative
feedback may damage these marketing organization elements.
Likewise, rm performance reecting the presence of customer
equity and brand equity, both intermediate marketing outcomes,
can be further developed and deployed in the resourcing of
the marketing strategy process. Finally, just as MARKORG is
nested in the larger rm, the marketing strategy process is part
of the larger, rm-level strategy process, which inuences how
the marketing strategy process unfolds.
Marketing excellence is a continuous process that leaves
no room for complacency. It requires marketing leaders who
can orchestrate the rms capabilities, culture, employees,
structure, metrics, incentives, and controls so that the entire
rm continuously responds and adapts to marketplace chal-
lenges in a superior manner. Together, MARKORG and the
7As offer a new frontier for the study of marketing excellence
that provides research-based evidence for investments in
marketing excellence. The research priorities outlined for
each MARKORG element, its integration, and the impact
of MARKORG on the 7As offer future directions for the
study of organizing for marketing excellence.
The Seven Marketing Firm
Activity Levers (7As) Performance
Designing
Anticipation
Adaptation
Intermediate
Marketing Outcomes
Customer equity
Brand equity
Resourcing
Attraction
Firm Outcomes
Asset Management
Product market
Implementing Accounting
Alignment Financial market
Societal
Activation
Marketing Capabilities for Marketing
Excellence
This lens on marketing excellence focuses on the bundles
of marketing skills and accumulated knowledge, exercised
through organizational processes, that enable a rm to carry
out its marketing activities. The concept of capabilities1 came
to the fore in the eld of strategic management in the mid-
1980s under the rubric of the resource-based view (RBV)
of the rm (Wernerfelt 1984). In this view, rm resources
include both assets and capabilities that are cultivated slowly
over time. Managements task is to determine how best to
develop, leverage, and improve these resources for com-
petitive advantage. The development of the RBV paralleled
an emerging consensus within marketing that the rms market
orientation is the coordinated application of interfunctional
resources to create superior customer value (Kohli and Jaworski
1990; Narver and Slater 1990). Day (1994) proposed specic
capabilities to be mastered by a market-driven organization
and Hunt and Morgan (1995, 1996) formulated a resource-
advantage theory to counter the constraining assumptions
of perfect competition theory. Today, the RBV continues to
play a prominent role in the marketing literature (Kozlenkova,
Samaha, and Palmatier 2014).
We review what is known and still needs to be known
about marketing capabilities by addressing ve questions: (1)
What are marketing capabilities? (2) How are they measured?
1For this review, we use capabilities and competencies inter-
changeably. Core capabilities are a subset of capabilities found at the
corporate level. Distinctive capabilities make a disproportionate
contribution to the rms competitive advantage.
Organizing for Marketing Excellence / 11
(3) What is the contribution of marketing capabilities to rm
performance? (4) How are superior marketing capabilities
developed? (5) How are marketing capabilities changed?
Web Appendix Table W1 summarizes the literature rele-
vant to these ve questions and Table 1 lists future research
priorities, detailed in the sections that follow.
What Are Marketing Capabilities?
There is a reasonable consensus in the literature that primary
capabilities within the domain of marketing include the fol-
lowing (for full details and complete descriptions, see Web
Appendix Table W1):
Market sensing and knowledge management capabilities
notably including market orientation as the process of gen-
erating, disseminating, and responding to market intelligence.2
Relational capabilities such as customer relationship manage-
ment (CRM) processes of acquiring and retaining valuable
customers and managing channel partnerships.
Management of the brand asset and the leveraging of brand
equity.
Strategic marketing planning and implementation or, more
generally, the architectural capabilities that direct and coor-
dinate the deployment of task-specic capabilities.
Specic functional capabilities related to the marketing mix
(pricing, product line management, marketing communica-
tion, and sales).
Future research priorities. First, a new set of marketing
capabilities have been introduced in the last decade that need
to be examined in further research. We review a few here. For
example, rm capabilities in digital marketing have not been
studied. Is digital just a new channel or is it a distinctive
capability? Firms are investing in and seek to leverage social
media for competitive advantage (The CMO Survey 2016,
p. 50). However, research has not yet documented capabilities
for developing, integrating, and leveraging social media in
marketing. Like digital marketing, marketing analytics operates
under some older marketing research processes that involve the
use of secondary data. However, big data expectations create
pressure to make marketing analytics more central to mar-
keting decision making. Given this, what are the features of
an effective marketing analytics capability? We urge scholars
to examine these newer capabilities and to identify other
important new marketing capabilities that will likely emerge
over the next decade.
Second, given that only Feng, Morgan, and Rego (2015)
have examined rm capabilities for building market-based
assets, such as brand, customer, and knowledge (Srivastava,
Shervani, and Fahey 1998), this question is an important
research opportunity. Third, research should consider how
lower-level capabilities (e.g., specialized marketing mix
2Capabilities related to the generation, dissemination, and respon-
siveness to market information often have not been viewed as capa-
bilities but instead considered part of the rms market orientation
(Jaworski and Kohli 1993; Kohli and Jaworski 1990) or culture
(Narver and Slater 1990). We believe that market orientation can
function through both organizational elements, and thus, we
review the market orientation literature in both the Capabilities
and Culture sections.
12 / Journal of Marketing: AMA/MSI Special Issue, November 2016
capabilities) relate to higher-level capabilities (e.g., archi-
tectural marketing capabilities). Is this accomplished through
distinctive processes or do the higher-order capabilities re-
quire steps that call on the more specialized capabilities to be
enacted? Relatedly, do specialized capabilities (e.g., channel
management) need to operate at least at a moderate level for
architectural capabilities (e.g., marketing implementation) to
contribute?
Finally, many marketing capabilities require the coor-
dination of different functions (e.g., CRM). Marketings
leadership of these capabilities remains an open question. As
new cross-functional capabilities such as social media, mar-
keting analytics, and omnichannel management emerge within
rms, will marketings inuence shrink or will it become more
inuential by serving as the integrator of important cross-
functional activities?
How Are Marketing Capabilities Measured?
Five methods have been used in the discipline to measure
marketing capabilities. First, researchers measure rm spending
to capture capabilities. For example, Mizik and Jacobson
(2003) measure research and development (R&D) and selling,
general, and administrative (SG&A) spending to derive a rms
capabilities for value creation or value appropriation. Second,
researchers measure the effects of marketing actions to reect
capabilities. For example, Moorman and Slotegraaf (1999)
measure a rms marketing capability by its market share, and
Johnson, Sohi, and Grewal (2004) measure a rms relational
capability by the effect of its relational knowledge stores on
relational outcomes. Third, scholars examine the efciency
with which a rm converts resource inputs into performance
outcomesfor example, marketing spending into sales (Dutta,
Narasimhan, and Surendra 1999). Fourth, a key informant ap-
proach uses knowledgeable and experienced managers to rate
(e.g., Homburg et al. 2012) or describe (Challagalla, Venkatesh,
and Kohli 2009) their rms. Finally, benchmarking asks key
informants to evaluate their rms marketing capabilities rel-
ative to major competitors (Vorhies and Morgan 2005).
Future research priorities. Research in this area has re-
ceived a great deal of attention in the last two decades. Thus,
our rst recommendation is for further research to compare the
strengths and weaknesses of these methods. To highlight a few
weaknesses, the rst three approaches require rm-specic
data that are not publicly available for private rms. However,
even for public rms, only weak surrogates for marketing
spending are usually available (e.g., selling, general, and ad-
ministrative expenses; advertising), which creates error when
measuring marketing capabilities. In general, secondary
data are limited for understanding capability mechanisms,
which is why scholars often perform primary research. A
weakness of primary data, often in survey form, is that it is more
difcult to collect over time, creating questions about causality
(see Rindeisch et al. 2008). Furthermore, informant ratings
have their own challengesinformants may be inuenced by
experience, position, or whether they are focused on the rm
relative to its goals versus relative to its competitors, which is
one reason research often uses multiple informants. Bench-
marking has also been criticized because it ascribes capability
strength to an industry optimum. However, as this is the
essence of competitive advantage, the approach is theoretically
consistent (Vorhies and Morgan 2005).
Second, research is needed to understand the extent to
which these measurement approaches triangulate. We en-
courage researchers to use a multimethod approach to increase
condence in marketing capability assessments. However,
because researchers use longer time series of data that enable
them to rule out rm unobservables, such multimethod ap-
proaches must be timed around available secondary data (see
Kumar et al. 2011). Researchers also should not overlook the
tremendous insight that can accrue from observational and
interview datamethods not often utilized to study capabilities
in marketing.
Third, researchers should examine how, if at all, mar-
keting leaders measure marketing capabilities. What inu-
ences whether and how measures are taken? Although the
data required for a 360-degree view are seldom available to
researchers, managers have this access. We recommend this
triangulated view of capabilities to practice while also urging
scholars to assess the current state of capability measurement
in practice.
What Is the Contribution of Marketing Capabilities to
Firm Performance?
Two meta-analyses examine this question. Krasnikov and
Jayachandrans (2008) meta-analysis of the marketing
literature nds that marketing capabilities make signicant
contributions to both revenue and prots. Kirca, Jayachandran,
and Beardens (2005) meta-analysis concludes that capabilities
related to market orientation have a direct positive effect on
nancial, customer, innovation, and employee consequences.
In addition to their direct effects, marketing capabilities
have important moderating and indirect effects. The most
common moderating effect is the complementarity of mar-
keting and R&D capabilities, meaning the synergistic effect
from the combined presence of the two capabilities (Dutta,
Narasimhan, and Surendra 1999; Moorman and Slotegraaf
1999). Likewise, marketing capabilities have been shown to
improve the returns from other strategic actions, such as
brand acquisitions (Wiles, Morgan, and Rego 2012), and to
soften the effect of negative press releases on investor
responses (Xiong and Bharadwaj 2013). Considering indirect
effects, rm innovativeness mediates the effect of market
orientation on performance (Han, Kim, and Srivastava 1998;
Kirca, Jayachandran, and Bearden 2005).
Most assessments of performance effects use one-time
cross-sectional samples. An exception is Kumar et al.s
(2011) study of the changing role of market orientation
over eight years. Their results indicate that the effect of
market orientation on sales and prots is positive across all
time periods. However, the effect of market orientation on
these nancial outcomes diminishes over time, suggesting
that the greatest benets accrue to early adopters. This puts
a premium on nding new capabilities, which we discuss in
detail in a subsequent section.
Future research priorities. The core question of whether
marketing capabilities have a performance effect has been
answered with a resounding yes. Therefore, the eld needs
to move forward in several directions. First, research should
examine the relative performance effects of different mar-
keting capabilities. Instead, scholarship has focused on a sub-
set of marketing capabilities (see Table W1 in the Web Appendix)
or formed an aggregate measure of marketing capabilities (e.g.,
Vorhies and Morgan 2005). The eld could benet from a
detailed assessment of the value of various marketing capa-
bilities that also accounts for direct effects on the formation and
functioning of higher-order capabilities which, in turn, have
performance effects.
Second, we see opportunities to examine two different
temporal dimensions of capabilities. Kumar et al.s (2011)
results regarding a diminishing effect of market orientation
point the eld back to the importance of protecting capa-
bilities from imitation by competitors. If we approach their
results from this perspective, what inuences the diminishing
returns or imitation rates, and how do the late adopters learn
from early adopters? On the second temporal question, Feng,
Morgan, and Rego (2015) nd that short- and long-run mar-
keting capabilities affect performance differently. Specically, a
rms short-run market-based asset leveraging capabilities have
no effect on rm performance, whereas long-run market-based
asset building capabilities have a strong positive effect. Fol-
lowing their lead, we see an opportunity to study the short-
and long-run effects of other marketing capabilities on rm
performance.
Third, Kirca, Jayachandran, and Beardens (2005) meta-
analysis shows that capabilities related to market orientation
have important performance effects through their effect on
innovation. However, we know very little about other mar-
keting capabilities. Do marketing capabilities work through
different mediators, such as employee outcomes? Research
needs to document these intermediate stages so that scholars
and practitioners know where to look for early performance
effects.
Fourth, although the literature has documented the pres-
ence of marketing and R&D capability complementarities, we
still do not have a good understanding of why these com-
plementarities occur. Dutta, Narasimhan, and Surendra (1999)
introduce marketing capabilities as an input to both R&D
capabilities (i.e., the voice of the customer impact of mar-
keting) and operations capabilities (i.e., a marketing learning
curve). However, R&D and operations inputs are not used to
determine a rms marketing capability. A stronger conceptual
treatment of these inputs and mechanisms would be a welcome
addition to the literature. In general, understanding under what
conditions capabilities become complements as well as rm
differences in the achievement of complementarities would
boost research and practice in this area.
How Are Superior Marketing Capabilities
Developed?
Literature in this area examines the antecedents of superior
marketing capabilities through two distinctive approaches.
The rst approach, which is more organizational, is built on
Kohli and Jaworskis (1990; see also Jaworski and Kohli
1993) dissection of the drivers of market orientation as (1) top
Organizing for Marketing Excellence / 13
 FIGURE 2
Building Superior Marketing Capabilities
Embed in formal
and informal
organizational
processes
Build knowledge
and skills (train,
hire, partner,
or acquire)
Identify
predictive Ensures
knowledge capabilities create
and skills superior value
managements emphasis on the customer, (2) a high degree of
interdepartmental connectedness, (3) a low (high) level of
organization centralization and formalization for information
acquisition and dissemination (information responsiveness),
and (4) the use of metrics and incentives to reward employees
for market-oriented behaviors. Ruekert (1992) was the rst to
add the importance of market-oriented training to the devel-
opment of market orientation capabilities. Meta-analysis sup-
ports the role of these factors (Kirca, Jayachandran, and Bearden
2005). Feng, Morgan, and Rego (2015) adds that a strong
marketing function inuences the quality of a rms capabilities
for developing and leveraging market-based assets.
A second approach emphasizes sustained competitive
advantage and increasing the inimitability of capabilities.
These principles, which are drawn directly from research on
the RBV of the rm, are often evoked as reasons why rms
should invest in capabilities and why capabilities are a cen-
tral part of business performance (Bharadwaj, Varadarajan,
and Fahy 1993). Research has suggested that rms can learn
new capabilities by benchmarking against successful com-
petitors (Vorhies and Morgan 2005)3 and by indirect or ob-
servational learning of competitors practices (Banerjee, Prabhu,
and Chandy 2015).
Future research priorities. Figure 2 depicts the process
for developing superior marketing capabilities that we use to
outline future research opportunities. The process begins by
identifying which knowledge and skills are important to the
rms success. This understanding should come from careful
consideration of the position the rm wants to occupy and the
3Importantly, although rms that perform closer to the industry
benchmarks are identied by their superior performance, research
has not identied whether using the benchmarking process leads to
superior capabilities.
14 / Journal of Marketing: AMA/MSI Special Issue, November 2016
Sustained
Competitive
Advantage
Build experience
and climb the
Integrate to create
learning curve
complementarities
Makes capabilities
difficult to imitate
types of value it will offer customers. Research should consider
how rms make such decisions and how much they are driven
by rm objectives, competitors actions, or consultants advice.
In the second stage, the rm builds the required knowledge
and skills through training, hiring, partnering, and/or acquisition
(Capron and Hulland 1999). To our knowledge, training for
marketing capabilities has not been addressed in the literature
at all. This is an important gap given Ahearne et al.s (2010)
nding that salespeople with a learning orientation are more
successful at adopting a new customer relationship system
than salespeople with a performance orientation. Likewise,
although we know that rms can develop new knowledge
from network partners (Banerjee, Prabhu, and Chandy 2015;
Johnson, Sohi, and Grewal 2004), research in marketing has
not carefully addressed the process of partnering for digital,
social, and mobile capabilities (see the Does Outsourcing
Marketing Affect Firm Performance? subsection).
Later stages embed the new knowledge and skills into
organizational processes (Grewal and Slotegraaf 2007;
Srivastava, Shervani, and Fahey 1999) and link the emerging
capability to other capabilities (Dierickx and Cool 1989)
both of which hinder competitor imitation. The nal stage
accumulates experience, which drives down costs, improves
effectiveness, and protects the rm from rivals. This idea is an
important part of the strategy literature; however, whether it
holds for marketing capabilities has never been investigated.
How Are Marketing Capabilities Changed?
There is an inevitable gap between the accelerating com-
plexity of markets moving at Internet speed and the ability
of even the most agile of rms to keep up. This is the province of
dynamic capabilities that reect the rms ability to integrate,
build and recongure internal and external competences to
address rapidly changing environments (Teece, Pisano, and
Shuen 1997, p. 516). Scholars have suggested that the ability to
change capabilities reects the rms ability to learn (Slater
and Narver 1995), its market orientation (Atuahene-Gima
2005; Kyriakopoulos and Moorman 2004; Morgan, Vorhies,
and Mason 2009), its experimentation and partnering skills
(Day 2011), and rm skills in resource reconguration
(i.e., the ability to retain, eliminate, and acquire resources)
and capability enhancement (i.e., the ability to retain, eliminate,
acquire, and improve capabilities) (Morgan 2012). Other
scholars have focused on domain-specic dynamic capabilities.
For example, Palmatier et al. (2013) point to a rms dynamic
capabilities for managing evolving channel relationships, while
Fang, Palmatier, and Steenkamp (2008) focus on dynamic
capabilities that help recongure a rms resources from
offering products to both products and services.
Another literature focuses on the microfoundations of
dynamic capabilities. This research stream aims to under-
stand the relationship between enterprise-level and individual
capacities (Helfat and Peteraf 2015; Teece 2007) for sensing,
seizing, and reconguring capabilities. Felin et al. (2012)
adopt a broad behavioral approach that accounts for indi-
viduals, processes, and interactions, as well as the structure
and interactions between these elements. Felin et al.s article,
which we recommend to readers seeking a broad introduction
to this topic, offers a review of the literature in strategy and
the organizational sciences.4
Future research priorities. It is imperative that marketing
contribute to this literature. First, new marketing capabilities
are needed to fully utilize advances in marketing analytics,
master the new social landscape of consumer behavior, and
offer seamless omnichannel experiences. How does a rm change
marketing capabilities and the required resource congurations
to move from ofine to online marketing or from traditional to
digital advertising? As important as these changes are to con-
temporary marketers, we know very little about them and how
they are ideally managed in rms. What are the biggest threats
to their success? Looking at our review for the three other
elements of marketing organization, we see opportunities
to utilize insights about how to empower employees (Ye,
Marinova, and Singh 2007) and use incentives, supervisory be-
haviors (Sarin, Challagalla, and Kohli 2012), and organizational
culture (Gebhardt, Carpenter, and Sherry 2006) in the capability
change process.
We also urge marketers to contribute to the literature on the
microfoundations of dynamic capabilities for several reasons. To
begin, the structural-cognitive tradition in marketing is a strong
platform on which to build (see Houston et al. 2001). Fur-
thermore, marketings strengths across individual, group, and
rm levels and the elds regular use of multilevel data place it
in a unique position to contribute. In addition, given that many
marketers play critical roles in the implementation of marketing
capabilities, we see an important opportunity to study how their
4Marketing has not specically pointed to microfoundations in
the study of dynamic capabilities. We think this is, in part, due to the
fact that marketings disciplinary traditions have easily traversed the
roles of people, processes, and structures. Research from the structural-
cognitive tradition in marketing is a strong example (see Frankwick
et al. 1994; Houston et al. 2001).
microbehaviors contribute to rm capabilities. Relatedly, a great
deal of marketing activity involves managing social activities
within and between rms, such as communication, trust building,
and social norms, which can also form microbehavior building
blocks for capabilities.
Marketing Conguration for
Marketing Excellence
Conguration describes the organizational setting within
which marketing capabilities are exercised and culture is
activated. We examine three broad conguration topics: (1)
organizational structure (Web Appendix Table W2A), (2) the
use of metrics (Web Appendix Table W2B), and (3) incentives
and control systems (Web Appendix Table W2C). Table 1
summarizes future research priorities.
Organizational Structure
Does the Marketing Function Contribute to Firm
Performance?
There is agreement that a strong marketing function contributes
to rm value. Primary research (Homburg et al. 2015; Moorman
and Rust 1999) and secondary research (Feng, Morgan, and
Rego 2015) support this view. Only Verhoef and Leeang
(2009) found no direct effect of marketing department inu-
ence on rm performance and instead reported that a rms
market orientation mediates its effect. However, a follow-
up study across seven countries uncovered a direct effect of
marketing department inuence on business performance
(Verhoef et al. 2011). The secondary data approach used by
Feng, Morgan, and Rego (2015) examines marketing function
power relative to other areas of the rm (see Web Appendix
Table W2A). The authors nd that marketing department power
increased during 19932008 and that marketing department
power has a positive effect on total shareholder returns.
Future research priorities. Given this history, future
research should rst focus on further establishing the gen-
eralizability of this nding. Verhoef et al. (2011) offer a
critical advance in this regard. Extending this research to
Asian, South American, and African companies in both de-
veloped and emerging economies would be an excellent
addition. Likewise, it is important to examine the general-
izability of the nding to businesses of all sizes and sectors,
especially technology- and science-based sectors, in which
marketing has historically played a weaker role. Second,
Moorman and Rust (1999) test their model by sampling
managers across marketing, R&D, nance, operations, and
human resources. We encourage future researchers to consider
this approach because it ensures that the effect is not due to
marketers evaluating marketing. Feng, Morgan, and Regos
(2015) secondary approach also rules out this explanation.
How Does the Marketing Function Contribute to
Firm Performance?
An array of mechanisms have been examined in the literature,
all of which point to marketing actions that add value to the
Organizing for Marketing Excellence / 15
rm, including customer-connecting activities (Moorman
and Rust 1999), involvement in key rm decisions and in
carrying out critical marketing activities (Homburg et al.
2015; Homberg, Workman, and Krohmer 1999), performing
market orientation activities (Verhoef and Leeang 2009), and
contributing to rm capabilities for long-run market-based
asset building and short-run market-based asset leveraging
(Feng, Morgan, and Rego 2015).
Future research priorities. Our rst recommendation is
to offer a deeper analysis of how the aforementioned mecha-
nisms interrelate to inuence rm performance. For example,
do marketing department decision inuence or marketing
department knowledge and skills contribute to the formation
of key marketing capabilities important to rm perfor-
mance? Such an analysis could help marketing departments
identify the most promising ways to contribute to rms. Second,
although Feng, Morgan, and Rego (2015) show that marketing
departments, in aggregate, are more powerful over time,
we know very little about the different evolutionary paths
of marketing departments, including departments that do
not improve over time. Why do some departments fail to
grow, whereas others rise or fall slowly or quickly? Are
there natural inection points in the process that reect
growth opportunities for marketing, such as rm entry into
new markets or the hiring of a new marketing leader into
the company?
Third, literature in this area has indicated the importance
of maintaining a strong marketing department even as the
rm nurtures its market orientation. However, research has
not considered how this balance is achieved. Specically, as
market-focused activities are assumed by different parts of
the organization, how does a strong marketing department
hold its center?
How Is Organizational Structure Aligned with Firm
Strategy and the Market?
This topic has been approached from a variety of angles.
First, research has shown that an organizations structure (i.e.,
its formalization, centralization, and specialization levels) in-
uences its ability to learn from and respond to the market
factors that should inuence the rms alignment with the
market. Accordingly, rms high on these structure variables
have lower market orientation levels (see Kirca, Jayachandran,
and Beardens [2005] meta-analysis) and make weaker use of
market information (Moorman 1995) and marketing plans (John
and Martin 1984).
Second, research examining how rm strategy and mar-
keting organization interact to inuence rm performance
has produced three sets of ndings. One set reports that the
effectiveness of Miles and Snows (1978) strategy types is
inuenced by the t of strategy with rm structure and ori-
entation (Olson, Slater, and Hult 2005) while a second set nds
that these strategy types moderate the market orientation
business performance relationship (Matsuno and Mentzer
2000). A third set adopts the view that there is an optimal t
of a rms strategy (type) and its marketing organization.
Vorhies and Morgan (2003) nd that similarity of the rms
strategy alignment to its structural and task characteristics
16 / Journal of Marketing: AMA/MSI Special Issue, November 2016
relative to the top-performing rm in the industry predicts
the rms marketing effectiveness and efciency.
Future research priorities. First, although early studies
have demonstrated the importance of t between the rms
strategy, structure, and environment, there are two challenges
to the value of these ndings. One challenge is that organ-
izational structure characteristics may operate at too high a
level to be useful to most marketing leaders. Researchers should
consider more intermediate structures, such as customer seg-
ment units, product-market groups, or key account teams. The
other challenge is that business strategy characteristics have
centered on Miles and Snows (1978) or Porters (1980) con-
ceptualization of business strategies. Distinguishing more
marketing strategies may be useful. For example, strategies
that offer customized and deep relational solutions, offer cus-
tomization and scale through an online channel, or involve
customers in cocreation might indicate the need for entirely
different forms of marketing organization.
Second, this research leaves open the question of the
evolution of organizational structure in rms. Research
adopting a longitudinal structural-cognitive approach that
documents the evolution of belief structures, relationships,
and activities in organizations offers one promising avenue
(see Frankwick et al. 1994; Houston et al. 2001). We rec-
ommend selecting important windows of strategic oppor-
tunity that require structure changes, such as the move to an
open network or the adoption of social media.
Third, alignment among structure, strategy, and the en-
vironment is particularly challenging for rms operating in
global markets. Research has found that marketing resource
allocation levels should be standardized across the United
States, United Kingdom, Canada, and Western European
markets (Szymanski, Bharadwaj, and Varadarajan 1993),
which would support more global organizational structures.
However, the question of standardizing marketing strategies
is more complex given that culture has been found to moderate
the consequences of relationship marketing activities (Hewett
and Bearden 2001; Samaha, Beck, and Palmatier 2014). Another
tension is the need to develop resources that support rm
efforts across markets (Morgan, Kaleka, and Katsikeas 2004)
while also operating efciently within markets. This tension
between building scalable, global resources that can be adapted
for local markets has received no attention in the literature.
What Is the Role and Impact of Marketing in
Cross-Functional Relationships?
Although this question has been addressed in several ways,
no conclusive answer has emerged. First, research has es-
tablished that a market orientation requires cross-functional
coordination (Kohli and Jaworski 1990; Narver and Slater
1990) and that marketing, as a function, contributes to this
coordination (Verhoef and Leeang 2009). However, mar-
ketings role requires managing important cross-functional
relationship dynamics (Moorman, Zaltman, and Deshpande
1992). Specically, research has also shown that marketings
inuence on nonmarketers is stronger when marketers use
more formal dissemination channels (Maltz and Kohli 1996)
and that marketings inuence on engineers is stronger when
marketers focus on goals that foster a nonfunctional orientation
(Fisher, Maltz, and Jaworski 1997).
Second, new product research has found that marketing
R&D cooperation has a positive effect on the concept devel-
opment, project development, and implementation stages of
the new product development process, whereas marketing
sales cooperation inuences only concept development and
implementation (Ernst, Hoyer, and Rubsaamen 2010). This
more specic nding runs counter to the more general nding
from meta-analyses that cross-functional integration plays
a very limited role in new product success (Henard and
Szymanski 2001), with still other research suggesting that the
need for formal integration between functions is more important
when the rm lacks experience with the new product area
(Olson, Walker, and Ruekert 1995) or when the focus is on
the creativity of the strategy and not its market perfor-
mance (Menon et al. 1999).
Future research priorities. First, why is marketings
cross-functional role so mixed? Following previous results,
research needs to account for (1) the teams objective; (2)
whether marketings role is assessed at each stage of the
process or on the nal team outcomes; (3) whether measures
of marketings inuence are taken from marketers, other
cross-functional team members, and/or from superiors; (4)
whether the team adopts horizontal versus vertical com-
munication patterns (Grifn and Hauser 1992); and (5) the
degree to which team members compete for resources even
as they cooperate to achieve their objective (Luo, Slotegraaf,
and Pan 2006). Once these components are accounted for, we
will have a better understanding of whether and how marketing
contributes to cross-functional teams. Second, how do new
cross-functional activities that use web-based collaboration
among geographically dispersed teams affect marketings
contributions? Will marketings contributions be easier or
more difcult to perceive in an e-environment?
Third, marketing has become one of the most technology-
dependent functions in business. One forecast is that by 2017
the chief marketing ofcer (CMO) will spend more on digital
technology than the chief information ofcer (CIO) (Arthur
2012). A certain consequence will be a profusion of specialist
roles such as data miners, web designers, and digital privacy
analysts. These new roles will necessitate team and cross-
functional structures that combine these specialists with more
traditional generalists. How should these specialists be
integrated with marketing and other functions of the rm?
What structures facilitate optimal decision making so that
these technical specialties help the company serve its customers
more protably and not serve the specialties focused interests?
How Should Firms Organize and Coordinate
Marketing and Sales?
Research in this area has found that the location of marketing
and sales is contingent on the size of the company, its global
orientation, and its market orientation, while organization is
inuenced by the relatedness of marketingsales activities
(Workman, Homburg, and Gruner 1998). Homburg, Jensen,
and Krohmer (2008) uncover ve archetypal forms of the
marketingsales interface that vary according to sales versus
marketing power, customer versus product orientation, short-
term versus long-term orientation, types of structures, infor-
mation sharing, and the role of different types of knowledge.
Future research priorities. Several forces press sales and
marketing to work together more effectively. The rst force is
the increasing demand from customers for integrated solu-
tions that extend beyond the product offering. Tuli, Kohli,
and Bharadwaj (2007) point to the importance of relational
processes that facilitate an understanding of the customers
requirements, customization and integration, deployment
strategies, and postdeployment support. Coordinating mar-
keting and sales activities across this solution funnel is an
important challenge that should be studied in more depth. The
second force is the need to coordinate the ever-expanding
ways to connect with customers in todays omnichannel
environment. For example, sales increasingly reaches cus-
tomers rst through digital tools designed by marketing. How
do marketing and sales cooperate effectively using these new
strategies? Third, leaders are impatient with balkanized
approaches to delivering customer value. However, research
has not fully explored effective leadership strategies for coor-
dinating marketing and sales (e.g., Homburg and Jensen 2007).
Does Outsourcing Marketing Affect Firm
Performance?
New product outsourcing announcements receive a positive
response from the stock market (Raassens, Wuyts, and
Geyskens 2012). Other research has pointed to important
contingencies in the outsourcingperformance relation-
ship, including the ease of evaluating the partners per-
formance in a sales force context (Anderson 2008) and the
rms general knowledge levels, tacit knowledge levels,
and technological volatility in a modular technology
system context (Stremersch et al. 2003; see Web Appendix
Table W2A).
At a more general level, research has addressed the rms
choice between performing marketing activities on its own
(make) and outsourcing (buy) using two approaches.
Transaction cost tradition suggests that the outsourcing
decision is based on the rms transaction costs and that these
costs are minimized by managing the external agent through
ex ante controls to screen and select partners and ex post
controls that train, socialize, monitor, and incentivize partners
(e.g., Rindeisch and Heide 1997). The relationship mar-
keting tradition has examined trust, commitment, and relational
norms that make partnerships more benecial to the rm over
the long run (Hunt and Morgan 1994; Moorman, Zaltman, and
Deshpande 1992; Palmatier et al. 2006). This tradition has also
documented that relationship building has a dark side in which
trust creates vulnerabilities that partners can exploit (Grayson
and Ambler 1999; Moorman, Zaltman, and Deshpande 1992).
These hidden costs of trust (Selnes and Sallis 2003) can
produce suboptimal partnerships when innovation is the goal
(Noordhoff et al. 2011) or knowledge spillovers are possible.
Finally, a subset of research has examined the inuence
of factors from both traditions (e.g., Heide, Wathne, and
Rokkan 2007; Jap and Ganesan 2000; Wathne and Heide
2000).
Organizing for Marketing Excellence / 17
 Future research priorities. First, marketing has a long
tradition of outsourcing activities such as marketing research
(Moorman, Zaltman, and Deshpande 1992) and advertising
(Villas-Boas 1994) and an increasing tendency to outsource
key innovation activities such as new product development
(Carson 2007; Rindeisch and Moorman 2001). However,
most research does not examine the make versus buy choice
but instead focuses on maximizing the effectiveness of the
buy decision. Only a subset of research has examined the
choice, which we recommend as a topic for further research.
Second, outsourcing may be a strategic necessity in new
marketing areas, such as social media, for which many rms
have limited knowledge and skills. What structural, legal, and
relational approaches are most effective in managing these
high-dependency partnerships (e.g., Palmatier, Gopalakrishna,
and Houston 2006)? Third, as rms involve more external
partners and customers, how does the rm protect its strat-
egies from imitation? We know very little about this topic (for
an important exception, see Stremersch et al. 2003). Fourth,
an emerging form of outsourcing involves customer co-
creation. How does outsourcing as cocreation affect the novelty,
speed, and effectiveness of marketing?
Does a Customer-Based Organizational Structure
Affect Firm Performance?
Many rms are shifting away from product or service groups
to groups focused on specic customer segments. As dened
by Homburg, Workman, and Jensen (2002), a customer-
focused organizational structure uses groups of customers
related by industry, application, usage situation, or some
other nongeographic similarity to organize rm activities.
Scholars have suggested that this structure improves
knowledge of and commitment to the rms target customers
(Jayachandran et al. 2005), identication and exploitation of
growth opportunities (Day 2006), and accountability for
managing customer relationships (Shah et al. 2006). In the
rst large-scale study comparing rms using a product struc-
ture with rms using a customer structure, Lee et al. (2015) nd
that a customer structure increases rm coordination costs,
which reduces rm nancial performance and increases
rm customer satisfaction, which in turn increases rm
nancial performance. However, the latter effect holds
only for rms in industries in which competitors have not
yet implemented similar structures or in which competitive
intensity is high.
Future research priorities. First, how does a rms change
from a product structure to a customer structure inuence
rm performance? Ideally, this design would compare rms
that do versus do not make the transition to resolve identi-
cation issues associated with the choice to transition. Second,
research could offer insight into the most effective strategies
for transitioning to a customer-based structure (for ideas, see
Homburg, Workman, and Jensen 2000). Third, what is the
impact of rm, industry, leader, and strategy factors in the
transition to a customer-based structure? For example, perhaps
it only works when a rm already has a market-oriented
culture.
18 / Journal of Marketing: AMA/MSI Special Issue, November 2016
The Use of Metrics5
What Metrics Do Firms Utilize?
Research addressing this question has covered important
descriptive territory. First, it examined the rate at which
various marketing metrics are used. In the most compre-
hensive treatment of this topic to date, Mintz and Currim
(2013) nd that rms use more marketing metrics than
nancial metrics. Among the most commonly used mar-
keting metrics are awareness (41% of rms), total cus-
tomers (37%), and market share (28%), while the most
commonly used nancial metrics are total volume (units or
sales; 43%), return on investment (ROI; 36%), and net
prots (28%). Second, other research has studied the use
of specic metrics, such as customer satisfaction metrics
(Morgan, Anderson, and Mittal 2005), scanner data metrics
(Bucklin and Gupta 1999), or mindset metrics (Srinivasan,
Vanhuele, and Pauwels 2010). Third, research has described
metric use as part of a rms capability for using market
information (Moorman 1995; Vorhies and Morgan 2003).
Fourth, studies have examined the use of marketing per-
formance measurement systems (Homburg, Artz, and Wieseke
2012; Morgan, Anderson, and Mittal 2005; OSullivan and
Abela 2007).
Future research priorities. First, as the eld embraces
digital, social, and mobile strategies, the nature of metrics use
needs to be reexamined to determine whether traditional
metrics are replaced by more sensitive process measures that
can be observed online (e.g., referrals). Second, although we
theorize that market-based assets such as strong brands and
customer relationships inuence speed of cash ows, we do
not have any research documenting whether rms use these
metrics. Third, although scholars have investigated the
impact of marketing on stock market-based metrics and have
even advocated doing so to nail down marketings impact
(Hanssens, Rust, and Srivastava 2009, p. 115), we know of
no academic research examining use of these metrics within
companies.6 Fourth, studies have focused on individual
metrics use. As marketing strategies are integrated across
areas of the rm and across traditional and digital strat-
egies, it is important to consider whether and how metrics
are used jointly. Finally, studies have tended to use self-
reports of metrics use. Observational studies of managers
using metrics or metric reports in a marketing simulation
game could offer reinforcing or new insights.
Does the Use of Metrics Contribute to Firm
Performance?
Research has observed a positive direct effect of the
number of marketing and nancial metrics used by a rm
on its marketing mix, customer outcomes, and protability
5This section examines how marketers use metrics, not how the
metrics in incentives and controls inuence marketer behavior,
which we investigate in the next section.
6A Towers and Watson executive compensation study nds that
only 3% of senior managers performance contracts use stock
market indicators (Smith and Stradley 2010).
(Mintz and Currim 2013). At the overall system level,
research has documented that use of a strong marketing
performance measurement system predicts rm perform-
ance and chief executive ofcer (CEO) satisfaction (using
primary data) and return on assets and stock returns (using
secondary data) (OSullivan and Abela 2007). Likewise,
studies have shown that the comprehensiveness of a mar-
keting performance measurement system impacts a rms
market alignment and market knowledge, which in turn
inuences its protability and market performance (Homburg,
Artz, and Wieseke 2012). The system does not have a direct
effect on rm performance.
Future research priorities. First, extending Homburg,
Artz, and Wiesekes (2012) focus on organizational medi-
ators, we need insight into how metrics use inuences individual
marketing decision making, including the decision-making
processes activated and trade-offs manifested when mar-
keters use different types of metrics. For example, Armstrong
and Collopys (1996) study shows that manager exposure to
competitor-based metrics (e.g., market share) hurts rm prots
by stimulating short-term thinking and a competitive, as opposed
to a customer, focus. Relatedly, Lehmann and Reibstein (2006)
classify metrics as evaluative or diagnostic, short-term or long-
term, and as using objective or subjective information. Do these
types moderate the impact of metrics use on the quality of
individual decisions? Second, how do the most effective
managers use metrics? If this is discoverable, we can design
decision support systems to deliver metrics to other man-
agers in these same ways.
Finally, while scholars advocate for the use of dash-
boards (Lehmann and Reibstein 2006; Pauwels et al. 2009),
research has not yet demonstrated that dashboard use
improves rm performanceindeed, OSullivan and Abela
(2007) observe no relationship! Therefore, we need research
that documents the ROI in building dashboards and training
managers to use them. Research should then consider how
to design dashboards for optimal performance. Which
metrics are most useful to have on a continuous basis and
which are better if evaluated less frequently? What number
and sequence of metrics is optimal? Likewise, prior research
has outlined the link between customer metrics and rm
performance (Gupta and Zeithaml 2006) and chains of
marketing productivity (Rust et al. 2004). However, these
linkages have not driven the design of dashboards for mar-
keting decision making.
What Factors Inuence the Use of Metrics in Firms?
Mintz and Currim (2013) examine a wide-ranging set of
antecedents (see their Table 5). One dominant antecedent
is the rms market orientation, which inuences its use of
marketing metrics (not nancial metrics) (Mintz and Currim
2013). Another set of antecedents focuses on marketing
research metrics use, which is inuenced by the relationship
between the providers and users (Moorman, Zaltman, and
Deshpande 1992); the formality of the channels used to
disseminate metrics (Maltz and Kohli 1996); and the tech-
nical quality, presentation quality, actionability, conrmatory
nature, and political acceptability of results (Deshpande and
Zaltman 1982). A third set of antecedents focuses on the
organizational buy-in (Lilien, Roberts, and Shankar 2013)
and resource commitments (Menon et al. 1999) to metrics.
Finally, rms operating in more turbulent environments also
report higher use of metrics (Mintz and Currim 2013).
Future research priorities. First, strategy should drive
metrics use. However, research on this issue is limited.
Mintz and Currim (2013) show that business-to-customer
rms use more metrics, whereas services rms use fewer
metrics. However, we do not know whether rms focused on
breakthrough innovation, which is difcult to evaluate, use
fewer metrics or whether rms with a deeper digital strategy
use more metrics. Second, what individual marketing leader
and employee characteristics inuence metrics use? Mintz
and Currim (2013) nd only that quantitative background
has a positive effect on nancial metric use. Considering the
effect of the leader/employees organizational identi-
cation or their learning versus performance orientation
may be fruitful directions. Third, what types of TMT
dynamics facilitate metric use? Do metrics get used more
when TMTs display a mix of cooperative and competitive
dynamics (Luo, Slotegraaf, and Pan 2006)? Finally, we do
not have an understanding of the process by which metrics
are adopted within companies. From prior research, we
know that metrics should not be viewed merely as tools of
nancial accounting or marketing engineering but as
innovations that diffuse in a company. We need research
to offer insight into that process, its challenges, and its
successes.
Incentives and Controls
Bergen, Dutta, and Walker (1992, p. 1) note that agency
relationships pervade marketing. These agents are
external partners acting on behalf of the rm or leaders and
employees acting on behalf of shareholders. Controls and
incentives shape agents behavior to align with principals.
In this section, we highlight agency problems documented
in the literature and offer insights into how marketing
excellence can be furthered through the use of controls and
incentives. Web Appendix Table W2C summarizes this
literature.
How Do Marketers Misbehave?
The topic of marketer misbehavior has a long history in
marketing. Several key themes have emerged. First, research
has classied the ethical principles used by marketers (e.g.,
Ferrell and Gresham 1985; Goolsby and Hunt 1992) and
types of opportunistic behavior, including whether it is active
versus passive and the result of current or changing con-
ditions (Wathne and Heide 2000). In terms of empirical
research, research has found misbehaviors associated with
errors of both commission and omission and that marketers
are more inuenced by principles when making ethical
judgements (deontological reasoning) than by consequences
(teleological considerations) (Hunt and Vasquez-Parraga 1993).
Distinguishing high- and low-stakes opportunity, Jap et al.
Organizing for Marketing Excellence / 19
(2013) nd that high-stakes (low-stakes) opportunism occurs
when relationship rapport is low (high).
Second, research has documented specic types of inten-
tional marketer misbehaviors, including gaming, smoothing,
focusing, and inaccurate reporting (Jaworski and MacInnis
1989); marketing researcher misbehaviors, such as research
integrity, fair treatment of clients and vendors, and con-
dentiality (Sparks and Hunt 1998); opportunism in mar-
keting partnerships (e.g., Murry and Heide 1998); and myopic
responses to stock market pressures (Mizik and Jacobson 2007;
see Table W2C in the Web Appendix).
Future research priorities. First, marketing has a high
level of perceived misconduct. Therefore, we urge scholars to
document whether this reputation is deserved by developing
methods to document a full range of these behaviors for
marketers in different roles. Second, research has offered
limited insights into the reasons for these misbehaviors.
Transaction cost scholars focus on opportunism that arises
from self-seeking, whereas research in the marketingnance
interface focuses on the temptations of short-term rewards
both are premised on hidden-action models in economics that
assume self-interest, incomplete information, and environ-
mental uncertainty. Other scholars have suggested that weak
organizational culture (Hunt, Wood, and Chonko 1989), lax
social norms (Dunfee, Smith, and Ross 1999) or weak pro-
fessional norms (Jaworski and MacInnis 1989) are the culprit.
Pitting these alternative explanations against one another in an
empirical test would lead to a better understanding of marketer
misbehavior.
How Should Marketing Agents Be Aligned for Firm
Performance?
The literature has examined a range of solutions (see Web
Appendix Table W2C). One stream of research has focused
on the broader control system to ensure that an agent acts in
the rms best interest, and it includes ex ante and ex post
control strategies,7 formal controls (on inputs, process, and
outputs) and informal controls (related to self, social, pro-
fessional and cultural factors), process versus outcome con-
trols, and behavior-based versus outcome-based controls. A
second stream of literature has focused exclusively on reward
structures, including individual versus group rewards and
single-period versus multiperiod rewards (for a detailed
discussion of ndings, see Web Appendix Table W2C).
Future research priorities. We see several challenges
and opportunities. First, there is very little integration across
the different literature streams in this area. Understanding
how different incentive and control systems relate to one
another, including whether they substitute, detract from, or
complement one another would be useful. Second, there is
a general view that aligning incentives with customer metrics
(e.g., customer satisfaction, retention) should reduce misbehavior,
7This is a large body of literature. As such, we review only a
handful in Web Appendix Tables W2A (see outsourcing question)
and W2C and recommend research by Weitz, Anderson, John,
Heide, Palmatier, Ganesan, Jap, Wathne, Scheer, and Ghosh as well
as an excellent review paper by Watson et al. (2015).
20 / Journal of Marketing: AMA/MSI Special Issue, November 2016
and many rms are adopting this approach. However, we need
research that documents this payoff and points to challenges.
Third, how do incentive and control systems work when
marketing occurs in open-network structures in which
responsibilities are diffused? Current research has shown that
how a rm manages its downstream customer partners
depends on the governance mechanisms it has deployed in
managing its upstream supplier relationships (Wathne and
Heide 2004) and that the customer orientation of a business-
to-business platform is contingent on rm dependence on its
customers (Chakravarty, Kumar, and Grewal 2014). Fourth,
research has focused on marketers misbehaviors and op-
portunism. How do some marketers and their rms resist the
forces of self-interest? What consequences result over both
the short and long run? Research examining marketers who
do not succumb to ethical temptations is an important
opportunity.
Finally, as rms expand globally, which incentives and
controls should vary across markets and which should hold
at standardized levels throughout the company? On the one
hand, what are the costs of standardization when global
systems challenge local cultural norms and expectations? On
the other hand, what are the costs of adapting incentives and
controls to local conditions, including employee dissatisfaction?
Does increased global employee movement, system trans-
parency, and communication make these adaptation costs
more likely?
Human Capital for Marketing
Excellence
Human capital is a key force in the creation, implementation,
and evaluation of marketing strategy (Hunt 2000). Both mar-
keting leaders (Web Appendix Table W3B) and employees
(Web Appendix Table W3A) are crucial operatives in mar-
ketings contributions. Yet research on this topic in marketing
has been uneven, with more research focusing on marketing
employees. However, the emergence of the CMO role has led
to renewed interest in the contributions of marketing leaders.
Marketing Leaders
Do Marketing Leaders Improve Firm Performance?
Initial research found no effect for the presence of a mar-
keting leader in the rms TMT. Nath and Mahajan (2008)
make this conclusion after examining the impact of a CMO in
the TMT on rm sales growth, Tobins q, market share, return
on assets, and return on sales. Boyd, Chandy, and Cunha
(2010) observe a heterogeneous effect for the appointment
of a CMO on rm stock returns, with 46% of rms showing a
positive effect and 54% a negative effect. Neither study
corrects for endogeneity in the choice to appoint a CMO.
Two recent studies that resolve the selection problem
offer a more positive view. Homburg et al. (2014) nd that a
CMO increases the likelihood of new venture funding by
46% and that this effect is stronger for CMOs with more
education, marketing experience, and industry experienceall
of which are viewed as contributing to the legitimacy of the new
enterprise. Germann, Ebbes, and Grewals (2015) tour de force
of empirical models concludes that the presence of a CMO in a
rms TMT improves a rms Tobins q.8 business administration degree from a prestigious university
Germann, Ebbes, and Grewal (2015) argue that accounting-
based measures such as ROI are unlikely to reect the expected
long-term effects of marketing leadership. They also argue that
outcomes such as market share or sales growth should not be
used because they are not goal agnostic. Both reasons might
explain why Nath and Mahajan (2008) do not show the
effect of the CMO. Instead, Germann, Ebbes, and Grewal
(2015) recommend the use of Tobins q because it is less
subject to tax manipulation and it is also goal agnostic
meaning that rm valuation is assessed on cash ows, not on
sales or market share. However, q is a capital market measure
that may reect and promote real earnings manipulations (Mizik
2010). This is all the more reason to study outcomes using a
panel structure so that such manipulations either wash out in the
model or are detected by the rm-specic model parameters.
Future research priorities. Research to date has focused
on broad capital market measures such as Tobins q, accounting
measures of prots, or sales growth. Future studies could rst
examine whether the presence of a CMO inuences the value
of a rms market-based assets, including customer equity,
brand equity, and market knowledge. Second, following
Germann, Ebbes, and Grewals (2015) recommendation,
does the presence of a CMO affect rm risk levels? Third,
does the presence of a CMO on the TMT affect cash ow
vulnerabilitythe least well-understood of Srivastava, Shervani,
and Faheys cash ow effects (see Frennea 2015)? Does the
CMO play a critical defensive role in protecting rm cash
ows from external threats?
What Inuences Marketing Leader Effectiveness?
Research has examined rm, industry, and individual-leader
factors that moderate the marketing leaderrm performance
effect. Nath and Mahajans (2008) null effect for the per-
formance effect of the CMO in the TMT is not inuenced by
rm strategy, industry concentration levels, or whether the
rm has an outsider CEO. In a follow-up article, Nath and
Mahajan (2011) nd that the impact of CMO power on rm
sales growth and return on sales converts a null effect for CMO
power into a positive effect when the TMT is segmented and
thus likely to benet from the integrative perspective of a
marketing leader. At the same time, the null effect becomes
negative when the rm uses a strategy of unrelated diversi-
cation, which would presumably benet less from this
integrative perspective.
Boyd, Chandy, and Cunha (2010) nd that a powerful
customer compromises marketing leader discretion and
weakens the leaders contributions to rm performance. This
negative effect is weaker when marketing leaders have more
role experience or more rm experience, when rm scope and
rm size are small, or when rm performance is strong.
8Germann, Ebbes, and Grewal (2015) also offer a good overview
of the modeling issues that confront researchers working on mar-
keting strategy problems; we recommend this article to young
scholars.
Homburg et al. (2014) nd that the positive venture-funding
effect of a CMO is stronger when the CMO has a masters of
as well as more marketing and industry experience. Germann,
Ebbes, and Grewal (2015) observe that the positive effect of
CMO presence on rm performance is stronger when the
company has strong sales growth and weaker when the CEO
has a long tenure and rm size increases.
Future research priorities. First, research has not exam-
ined the effect of organizational moderators associated with
structure and culture on the CMOrm performance link. From
literature on market orientation and organizational market
information processes, we might expect CMOs operating
in more externally focused cultures (which empower leaders
who are the vanguard of customer focus) or less bureaucratic
structures (which facilitate the ow of information) to make
stronger rm contributions. Of course, these same organiza-
tional factors may inuence marketing leader selection, so care
must be taken in the identication of these effects. Second,
while we know that education and experience are important,
research has not offered insight into how CMOs leverage them
to inuence rm performance.
Third, we know that CEO tenure dampens the CMOs
contributions to rm performance on capital market measures
(Germann, Ebbes, and Grewal 2015). However, research has
not examined a CMOs relationships with the chief nancial
ofcer, chief information ofcer, and chief technology ofcer
leaders who control nancial, digital, and technology assets
critical to marketing success. Further research should consider
how these internal relationships inuence CMO contributions
and what CMO characteristics, roles, and actions make for
successful long-term relationships with other members of
the TMT.
How Do Marketing Leaders Improve Firm
Performance?
The literature offers three answers to this question. The rst
focuses on the activities that marketing leads. Piercy (1986)
examines whether the chief marketing executive is respon-
sible for 20 different marketing activities (see also Homburg
et al. 2015; Homberg, Workman, and Krohmer 1999). Second,
Boyd, Chandy, and Cunha (2010, p. 1163) theorize that mar-
keting leaders perform three external rolesan informational
role that identies new opportunities for the rm to pursue and
threats to guard against, a decisional role that determines the
level and type of investments to be made in activities asso-
ciated with the marketing function, and a relational role that
develops and manages a rms relationships with external
stakeholders. Third, research has proposed that marketing
leaders perform a critical internal role that activates employees
by stimulating an employee-organizational identication process
(Wieseke et al. 2009) or by facilitating employee internal-
ization of the rms brand identity (Morhart, Herzog, and
Tomczak 2009).
Future research priorities. First, we see an opportunity
to offer a more complete view of the activities marketing
leaders perform that inuence rm outcomes. These might
include market orientation activities and mainstream
Organizing for Marketing Excellence / 21
marketing strategy actions (e.g., targeting) as well as
digital, social, and marketing analyticsbased activities.
Research needs to shed light on how much these activities
contribute to rm performance when managed by marketing
leaders versus other areas of the rm. Second, Jaworski
(2011) argues that there may not be a universal job description
for marketing leaders. Instead, requirements depend on the
CMOs different roles, the short-term or long-term impact, and
whether that impact is on thinking or actions. Research
should consider the combination of these elements as
different pathways to impact as Jaworski suggests, and it
should formally investigate whether certain combinations are
more effective than others.
Third, research has not examined the role of marketing
leaders in effectively leading growth initiatives. The CMO
Survey (2016) shows that marketing has responsibility for
innovation in only 28.6% of rms, which indicates that
marketing leaders are not playing an important role in growth.
Why is growth delegated to nonmarketing leaders and with
what effect? How does growth strategy change when man-
aged by a marketing leader?
What Inuences the Appointment of Marketing
Leaders?
Nath and Mahajan (2008) nd that CMOs are more likely to
be present in rms with stronger innovation, differentiation,
and corporate branding strategies; as TMT marketing ex-
perience increases and TMT general management experience
decreases; and when the CEO is an outsider. Homburg et al.
(2014) replicate some of these effects in start-ups and nd that
rms with a stronger innovation strategy and CEOs with
marketing experience are more likely to have a CMO. In
contrast, rm differentiation strategy and CEO start-up
experience have no effect. Finally, among new predictors,
chief nancial ofcer presence, demand instability, rm age,
and product introduction increase, and industry legitimacy and
complexity decrease, the likelihood of a CMO.
Future research priorities. First, research has not
examined how the match or t between marketing leader
characteristics and experiences and rm characteristics,
strategies, and goals inuence marketing leader appointment.
We think it is very likely that rms are attracted to appoint
marketing leaders who are more different from the rm on the
assumption that differences may produce the greatest oppor-
tunities for growth or change. However, these differences can
make it challenging for the CMO to lead effectively. Matching
models used in economics would be useful tools to investigate
which types of matches produce the greatest likelihood of
appointment and the strongest performance effects (e.g., Fox
2010).
Second, the nature and scope of marketing leader ap-
pointments is very diverse, reecting different types of roles
and responsibilities. However, research, in general, has not
investigated this diversity of appointments. Opportunities
include understanding why marketing leaders are appointed
to roles that reect marketing and sales; have designations
for customer, brand, or growth; or use terms such as are most valuable to practitioners (see Table W3B in the Web
Chief, Executive, or Senior Executive. Appendix).
22 / Journal of Marketing: AMA/MSI Special Issue, November 2016
What Is the Marketing Leader Turnover Rate, and
What Factors Inuence It?
Future research priorities. Although marketing leader
turnover is often reported to be higher than that for other
leaders, no research has addressed this topic. Therefore, our
rst direction is to determine the true rate of marketing leader
turnover and how it compares with other leaders. How much
CMO turnover is voluntary versus involuntary? Second, how
is CMO turnover inuenced by rm performance changes or
by deviations from expected rm performance changes?
Relatedly, what types of rm performance changes are most
predictive of CMO turnovergrowth, sales, prots, or
earnings performance? Third, is CMO turnover affected by
the nature of competitive rivalry in an industry? Specically,
when the rm is in a head-to-head battle with a competitor,
does the competitors marketplace outcome increase CMO
turnover? Fourth, how is turnover inuenced by the various
CMO roles and activities, which limit or enable the CMOs
ability to make contributions? Finally, how does the t or
match between marketing leader characteristics (e.g., edu-
cation, experience) and rm objectives and strategy inuence
turnover rates?
Marketing Employees
Do Marketing Employee Knowledge and Experience
Contribute to Firm Performance?9
Web Appendix Table W3B summarizes this literature, which
is mixed for marketing experience and more positive for
marketing knowledge. Marketer experience level improves
decision quality in less programmed areas (Perkins and Rao
1990) but reduces the number of competitors identied by
managers (Clark and Montgomery 1999) and the use of
nancial metrics (Mintz and Currim 2013). Surprisingly,
breadth of experience does not improve marketer creativity
(Andrews and Smith 1996). The two major studies addressing
marketer knowledge have found that the accuracy of frontline
employee (FLE; Homburg, Wieseke, and Bornemann 2009)
and salesperson (Mullins et al. (2014) knowledge improves
performance outcomes. Other research has examined the effect
of knowledge variantsemotional intelligence (Kidwell et al.
2011) and the accuracy of intuitive judgements (Hall, Ahearne,
and Sujan 2015)both of which have positive effects on sales
performance.
Future research priorities. First, although nearly every-
one agrees that new knowledge and skills will be important for
marketers operating in a digitally interconnected world, there
is little agreement about the specic knowledge and skills
required. Second, what research approaches and tools should
be used to isolate the effect of marketing knowledge and
experience? Experiments offer one solution, as does the use
of a range of measures (e.g., self, superior, and peer ratings) in
9This is a broad topic in the marketing literature. For brevity, we
focus on four topics that are part of the MSI priority and that we think
eld studies. Another strategy is to isolate an outcome over
which marketing employees have control and measure the
effect of their knowledge and experience. Third, and relat-
edly, what is the contribution of individual marketing knowl-
edge and experience to rm performance? The literature has,
in general, related individual knowledge, skills, experience,
and training to individual performance. In sales settings, these
individual outcomes can be aggregated to rm performance.
However, this is more difcult to do in other marketing set-
tings, in which marketers individual contributions link to
collective outcomes.
What Is the Impact of Marketing Training?
The literature offers a mixed view of this topic. On the one
hand, training for new product decisions (Bolton 2003),
advertising allocations (Hutchinson, Alba, and Eisenstein
2010), and ethics (Sparks and Hunt 1998) does not work. On
the other hand, creativity training does seem to work (see Web
Appendix Table W3B). Likewise, sales training improves trade
show performance (Gopalakrishna and Lilien 1995), but other
research has shown important contingencies. For example,
Kalra and Soberman (2008) nd that training salespeople to
beat the competition does reduce competitors prots but also
reduces company prots. Kumar, Sunder, and Leone (2014)
nd that sales training has a positive, nonlinear effect on the
value of the salesperson to the rm, as measured by customer
lifetime value. Salespeople are, however, differentially re-
sponsive to task-related and growth-related training, which
means that rms should use information about these types
to use training to maximize rm prots. Finally, Morhart,
Herzog, and Tomczak (2009) nd that managers can be
trained to enact the behaviors associated with brand-specic
transformational leaders.
Future research priorities. First, research should offer a
meta-analytic view of training for critical marketing skills to
gain insight into which training tools (in person, computer
mediated, gamication, etc.) and training modes (experi-
ential, case based, lecture, etc.) work best in which situations.
Second, what individual factors moderate the effect of
marketing training? We know that employee performance
(Godes 2003), learning versus performance orientation
(Kohli, Shervani, and Challagalla 1998; Sujan, Weitz, and
Kumar 1994), and whether the training is growth or task
oriented (Kumar, Sunder, and Leone 2014) are important;
what other motivational factors are important to training?
Third, does training affect outcomes such as likelihood of
hiring and turnover? If so, these outcomes should be in-
cluded in the ROI of training.
How Does the Management of FLEs Affect
Customers and Firm Performance?
Research in this area has focused on how service quality
(Parasuraman, Zeithaml, and Berry 1985) and sales outcomes
break down due to poor management of FLEs. Research has
identied the importance of supportive physical surroundings
(e.g., Bitner 1992) and the negative effect of employee
burnout (Singh 2000), role stress, and role ambiguity (e.g.,
Chan and Wan 2012; Hartline and Ferrell 1996) on how well
employees contribute. Other research has pointed to the use
of strategies such as improving coworker feedback (Jaworski
and Kohli 1993), involving employees in managing change (Ye,
Marinova, and Singh 2007), and encouraging supervisors to
shift between an outcome and process focus depending on
the FLEs orientation (Sarin, Challagalla, and Kohli 2012).
Research examining the effect of customer orientationthe
belief that the organization should place customers interests rst
in all decisionshas found that this trait reduces job stress and
increases job engagement, which, in turn, increases employee
performance and reduces turnover (Zablah et al. 2012).
Future research priorities. Research has produced a
range of important ndings, but very little integration. We see
an opportunity to consider how strategies reecting different
psychological, organizational, economic, and structural
mechanisms may or may not work together to inuence FLE
performance. Another direction involves examining the role
of marketing leaders in the effectiveness of FLEs. Most
research in this area has examined the employees immediate
supervisor. This makes sense, but what role does the rms
top marketing leader play in FLEcustomer interactions?
What Is the Impact of Employee Satisfaction on
Firm Performance?
Research on the service-prot chain has found that employees
actions and satisfaction inuence customers actions and
satisfaction, which, in turn, improves nancial performance
(Heskett et al. 1994). Empirical studies have offered strong
support for the core tenets of this view, with important
conceptual renements. For example, research has shown
that investments in employees have a positive effect on cus-
tomer perceptions of employees and that these perceptions
increase customer purchase intentions, purchase, and retention
(Kamakura et al. 2002). Likewise, employee satisfaction has a
direct effect on bank revenues and moderates the relationship
between a banks investments in technology and revenues
(Dotson and Allenby 2010).
Future research priorities. First, research has yet to
parse out whether it is employee satisfaction or the type of
employee who is attracted to work for a certain type of rm that
is responsible for the FLEperformance effect. Second, research
has not fully exposed the types of behaviors that arise from
employee satisfaction. Does employee satisfaction increase
extrarole and stewardship behaviors and/or diminish burnout?
Alternatively, research could examine how satised employees
share customer information vertically and horizontally as well as
how often they take the initiative to solve customers problems.
Third, research has documented a connection between a
rms employees and brands. Siranni et al. (2013) nd that
brand evaluations and brand equity both increase when there
is alignment between employees and brand personalities.
Tavassoli, Sorescu, and Chandy (2014) nd that CEOs who
work for strong brands accept lower pay. Future studies could
examine other aspects of the brandemployee relationship.
For example, are employees more satised when they work
for a rm with a strong brand? Does satisfaction inspired by
brand produce different behaviors than satisfaction inspired
by a connection to a specic job or to the larger rm culture?
Organizing for Marketing Excellence / 23
Organizational Culture for Marketing
Excellence
How has Organizational Culture Been Studied in
Marketing?
Forms of culture. Research in marketing has studied
three different forms of organizational culture (see Web
Appendix Table W4). The rst views culture as the pattern
of shared values and beliefs that help individuals understand
organizational functioning and that provide norms for
behavior (Deshpande and Webster 1989, p. 4). Norms,
which are shared beliefs about appropriate and inappropriate
behaviors, and mental models, which are shared simplifying
belief frameworks (Day and Nedungadi 1994), are often
classied together with values. 10
A second form of organizational culture views culture as
behaviors. Narver and Slater (1990, p. 21) dene market
orientation as the organization culture that most effectively
and efciently creates the necessary behaviors for the creation
of superior value for buyers and, thus, continuous superior
performance. A third form of organizational culture is repre-
sented by cultural artifacts that include stories, arrangements,
rituals, and language that are created by an organization and
have strong symbolic meaning (Homburg and Pesser
2000, p. 450). For example, in Gebhardt, Carpenter, and
Sherry (2006), artifacts are often brought in from eld visits
to create a shared understanding of the market.
Content of culture. The marketing literature has studied
six types of cultural content. First, market-oriented culture
has been described in two ways. Narver and Slater (1990)
focus on three behaviors reecting a customer orientation,
competitor orientation, and interfunctional orientation, while
Gebhardt, Carpenter, and Sherry (2006) focus on values and
norms that support the market as the rms raison detre,
collaboration, respect/empathy/perspective taking, keeping
promises, openness, and trust. Second, Deshpande, Farley,
and Webster (1993, p. 27) focus on customer orientation as
the set of beliefs that puts the customers interest rst.
Third, the competing values framework identies four cul-
tures that arise from the intersection of an internal or external
orientation and informal or formal processes (Moorman
1995). Fourth, Tellis, Prabhu, and Chandy (2009) focus on
six qualities of a culture of radical innovation (see Web Appendix
Table W4). Fifth, studies have examined a culture focused on
employee learning and development (Hurley and Hult 1998).
Sixth, research has examined rm-level equivalents of Hofstedes
national culture measures (Wuyts and Geyskens 2005).
Future research priorities. Research in this area has
noticeably slowed. One reason for this is that the connection
between culture and marketing performance is rather distal.We
offer two recommendations to make the effect more proximate
(for a complete list, see Table 1). First, what additional cultural
values, behaviors, and artifacts play important roles in marketing
10Other research in marketing has separated values and norms as
distinctive forms of culture that should be measured independently
(Homburg and Pesser 2000).
24 / Journal of Marketing: AMA/MSI Special Issue, November 2016
strategies? Values that prioritize the long run over the short run
or product-market performance over stock market performance
may be useful directions. Second, given the importance of
market-based assets, we recommend the development of
theory about a rms market-based asset-focused culture.
This culture would emphasize developing, leveraging, and
improving a rms intangible assets (customer relationships,
brands, and knowledge) that arise from the commingling of the
rm and the marketplace (Srivastava, Shervani, and Fahey
1998, p. 4).
How Is Organizational Culture Measured in
Marketing?
Most research has used surveys of key informants (see Web
Appendix Table W4). For example, Tellis, Prabhu, and
Chandy (2009) use a large-scale survey to measure six
cultural attitudes and behaviors across 17 countries. An
exception is Gebhardt, Carpenter, and Sherry (2006) who
use a multimethod approach.
Future research priorities. Although a multimethod ap-
proach offers the most valid way to measure organizational
culture, this may not be possible when a large sample of rms
is studied. In this case, multiple informants can increase con-
dence in survey results or a select set of case studies can be
used to complete the cultural portrait emerging from a survey.
Given the role of language as a cultural artifact, text analysis
can also be used to measure culture (see Yadav, Prabhu, and
Chandy 2007). Although the use of text analysis to measure
culture is intriguing, care must be taken to capture text that
is a valid indicator of culture and does not serve a public
relations objective. Finally, we see an opportunity to develop
stronger artifact-based measures of culture. These artifacts may
be reected in the organizational reporting structure; in job
descriptions; and in the design of websites, customer service
operations, products, and services. Many of these artifacts are
visible to us as researchers, and we urge scholars to examine
these tangible manifestations of culture for novel insights.
What Is the Contribution of Culture to Firm
Performance?
A modest stream of research examines the performance effects
of culture. Findings have indicated that an innovative culture
increases rm nancial performance (Rubera and Kirca 2012;
Tellis, Prabhu, and Chandy 2009) and cultures with different
competing values inuence rm information outcomes and
relationship outcomes (see Web Appendix Table W4). A
customer-oriented culture has a positive effect on nancial
performance (Deshpande, Farley, and Webster1993). A market-
oriented culture improves market performance (Homburg and
Pesser 2000), nancial performance (Narver and Slater 1990),
and innovation outcomes (Kirca, Jayachandran, and Bearden
2005).11 Han, Kim, and Srivastava (1998) also nd evidence
of a market orientationinnovationperformance chain. These
results dispel the view that a market-oriented culture might
11This meta-analysis includes market-oriented culture (Narver
and Slater 1990) and market-orientation processes/capabilities
(Jaworski and Kohli 1993).
 FIGURE 3
Building and Sustaining a Market-Oriented Culture

Gebhardt, Carpenter, and Sherry (2006);

Kohli and Jaworski (1990); Lam, Kraus,
and Ahearne (2010); Morhart, Herzog,
and Tomczak (2009);
Noble and Mokwa (1999)

Align leader walk

and talk
Innovation: Hurley and Hult
(1998); Moorman (1995)
Financial performance:
Barwise and Meehan Demonstrate impact Deshpand, Farley, and
(2011); Deshpand and Attract curious open- across financial and Webster (1993); Jaworski
Zaltman (1982); Gebhardt, minded human capital nonfinancial outcomes and Kohli (1993); Kirca,
Carpenter, and Sherry Jayachandran, and Bearden
(2006) Core Value: (2005); Kohli, Jaworski,
and Kumar (1993);
Prioritize Kumar et al. (2011);
serving target Narver and Slater (1990)
customers
over the long
run
Gebhardt, Carpenter, and Build through values, Jaworski and Kohli (1993);
Sherry (2006); Offer resources and
beliefs, norms, behavior, Kirca, Jayachandran, and
Homburg and Pflesser rewards
and artifacts Bearden (2005)
(2000); Moorman and
Miner (1997)

Build effective
informal and formal
learning mechanisms

Day (1994); Gebhardt, Carpenter, and

Sherry (2006); Kohli and Jaworski (1990);
Sinkula (1994); Slater and Narver (1995)

dampen rm innovation because customers are unable to
describe unmet needs or because it induces a narrow focus
on current customers (Christensen 1997).
Future research priorities. First, the term customer-
centricity has increasingly supplanted market orientation
when referring to culture. In this view, less consideration is
given to the competitor orientation as a feature of market-
oriented culture (Narver and Slater 1990). Does this de-emphasis
endanger the performance effects of market-oriented culture,
or does it unleash an even stronger performance effect? Both
outcomes are possible. On the one hand, a lack of focus on
competitors might mean the rm loses sight of its differ-
entiation from competitors or is eclipsed by competitors
leapfrogging ahead. On the other hand, a weaker emphasis
on competitors may enable rms to give full attention to
serving their customers (Rindeisch and Moorman 2003).
As Jeff Bezos (2009) noted, When given the choice of
obsessing over customers or obsessing over competitors,
we always obsess over customers. We pay attention to what
our competitors do but its not where we put our energy.
Its not where we get our motivation from.
Second, Tony Hsieh (2010, p. 15), the CEO of Zappos,
has stated, Your culture is your brand. The idea that culture
can produce powerful market-based assets, such as brands, is
not a controversial idea. However, no research has demon-
strated this connection empirically.
Third, the literature on market-oriented culture has not
considered how the rm serves both its business-to-business
partners and its ultimate end consumers. It ignores this dual-
customer status and has not addressed how rms can keep their
cultures focused on both customers to maximize performance.
Fourth, a key challenge in this area is separating the performance
impact of culture from other contributing forces, such as the
leaders who help create it and the strategy that carries its values,
norms, and artifacts. To that end, a longitudinal view of culture
and other contributing factors may provide insights into the
distinctive role of culture on rm performance.
How Should Firms Build and Sustain a Market-
Oriented Culture?
Leadership commitment and behavior modeling are crucial
to any change initiative. Gebhardt, Carpenter, and Sherry

Organizing for Marketing Excellence / 25

(2006) observe a four-stage organizational change process
led by a group of leaders, which they liken to a political
revolution. Lam, Krauss, and Ahearne (2010) identify a
social learning process in which middle managers and work-
group expert peers serve as top managers envoys and role
models of market-oriented behaviors to FLEs. Relatedly,
Hartline, Maxham, and McKee (2000) nd three corridors
of inuence used to disseminate a customer-focused strategy
to employees.
Figure 3 synthesizes other factors observed in the liter-
ature. First, the rm needs to attract managers and employees
whose curiosity and open-mindedness provide a powerful
combination for generating valuable customer insights.
Second, aligning leaders talk and walk is critical because
a market-oriented culture can only be built on leadership
commitment. Third, demonstrating the rewards of a market-
oriented culture to leaders and employees motivates further
adoption. Fourth, offering resources to support and rewards to
motivate improves adoption; fth, aligning cultural indicators
ensures consistency. Finally, rms need effective informal and
formal learning systems to disseminate successes and lessons
throughout the organization.
Future research priorities. First, we know that leaders
shape the culture. What are the most effective actions, and
how should they be adapted to the historical and competitive
realities of the rm? Second, cultural change is usually
viewed as a deliberate process (Gebhardt, Carpenter, and
Sherry 2006), but it could also be an emergent process. If
so, what begins the process and the activities that occur?
Research in the structural-cognitive tradition could aid in
tracing the emergence of belief change in the organization
(Hutt, Reingen, and Ronchetto 1988). Third, research should
consider culture as an outcome of marketing activities. Spe-
cically, how is the rms culture built from the enactment of
marketing activities over time? Such activities house implicit
values, beliefs, and norms and operate through artifacts.
Integrating the Four Elements of
Marketing Organization
One of the oldest ideas in marketing and strategy is the
importance of integration or t among organizational
activities. Although we acknowledge their interactions in
Figure 1, our treatment of the four elements of MARKORG
does not deeply consider how these elements inuence one
another. This is also a fair reection of the marketing
literature. Conceptual advances have been either macro in
orientation, such as how structure might be subsumed in
culture (Day 1990) and how activities and information should
be aligned (Gulati 2009), or more micro in orientation, such
as how employees should be managed or rewarded (see Web
Appendix Table W3B). One promising start was Kohli and
Jaworskis (1990) conceptual dissection of the drivers of a
market orientation, which includes senior managements com-
mitment, interdepartmental dynamics, and conguration ele-
ments such as the level of structure and the use of incentives to
reward employees for market-oriented behaviors. The cumu-
lative research on this issue (captured in Kirca, Jayachandran,
26 / Journal of Marketing: AMA/MSI Special Issue, November 2016
and Bearden 2005) afrms the importance of these factors but
has yet to grapple with how these elements effectively inte-
grate for marketing excellence. This section offers a set of
basic questions and our initial answers on this topic to promote
further research in this area.
How Does MARKORG Integration Enable Marketing
Excellence?
One approach is to treat each MARKORG element as an
integrating force for the alignment of the other elements.
Marketing leaders are integrating agents that facilitate coor-
dination by directing the development or deployment of capa-
bilities, the selection of metrics and incentives, the cultivation
of cultural values, and the design of structure. A market-oriented
culture reects integrating values that align mindsets, moti-
vations, and behaviors to a set of deeply held values. A rms
marketing capabilities are integrating processes that facilitate
coordination by dictating action steps, communicating cultural
values, and producing organizational structures to get work ac-
complished. Integrating congurations such as organizational
structures and control systems coordinate action by directing
attention and facilitating information ows.
Another approach is to identify integrating mechanisms
that inuence the selection or operationalization of each
MARKORG element. The voice of the customer serves as
an integrator that drives fundamental strategy decisions and
aligns people, processes, and structure around the customer
(Grifn and Hauser 1993). The customer value proposition
serves as an integrator because it sets the strategic direction
regarding target markets, the offering, and the rms com-
petitors. The business model integrates the organization by
aligning rm choices in capabilities, partnerships, and strategies
to create customer value, capture economic value, and protect
that value from competitors (Porter 1996). Finally, marketing
doctrine, dened as a rms unique principles, distilled from its
experiences, which provide rm-wide guidance on market-
facing choices (Challagalla, Murtha, and Jaworski 2014,
p. 1), may serve as an integrating mechanism by guiding the
selection of people, capabilities, reward systems, and even
structures.12 These integrating forces and mechanisms re-
quire theories that account for how the four MARKORG
elements work together to enable marketing excellence. We
urge scholars to offer frameworks that account for these
integrative activities.
How Does MARKORG Link Across Organizational
Levels for Marketing Excellence?
Our review treats the higher-level constructs of capability,
conguration, and culture at the business unit level, while
human capital resides with individuals. How are these levels
aligned to enable excellence? Several integrating directions
are possibletop-down (from the TMT to the rest of the
rm), bottom-up (from employees up the chain), or middle-
12The MARKORG also inuences doctrine and goals. For
example, Challagalla, Murtha, and Jaworski (2014) suggest that
marketing doctrine arises when marketings authority and activities
are more diffused and decentralized (as opposed to centralized in a
function).
out (from middle managers that create and socialize change).
The study of these different directions, which ts within the
emerging study of microfoundations in the eld of strategy
(Teece 2007), raises several provocative questions for mar-
keters, including (1) How is dispersed marketing information
and knowledge aggregated within rms and embedded in
capabilities (Krush, Sohi, and Saini 2015)? (2) How is a
market orientation shaped by the actions of the leadership
team to induce interfunctional coordination? and (3) How can
the marketing and sales functions be aligned to leverage their
respective skills (Homburg and Jensen 2007), and what
happens when they are combined into a single, commercial
function?
How Does MARKORG Link Across Organizations
for Marketing Excellence?
Firms and their marketing activities are increasingly nested
and executed within networks of channel partners, alliances,
and stakeholder arrangements (Achrol 1991; Webster 1992).
In the relational view of the rm (Dyer and Singh 1998), these
networks and relationships are the unit of analysis to be
managed. Insights are needed into how to coordinate and
align MARKORG across such arrangements. For example,
how do rms use their partners to extend the reach of their
market intelligence capabilities? How are divergent struc-
tures and cultures aligned? Research should investigate the
types of integrating mechanisms that work most effectively in
these settings.
Marketing Organization
Contributions to Firm Performance
The Role of the Seven Marketing Activities (7As)
The effect of MARKORG on rm performance is often
indirect and difcult to observe. These elements have to be
mobilized and then converted into activities that marketers
deploy to generate rm performance results. Reviewing the
literature, we observe seven activities or action levers (7As)
that perform the translational work of marketing organization
on performance. Figure 1 highlights the mediating function
of the 7As. The 7As include marketing contributions to
anticipating marketplace changes; adapting the rm to such
changes; aligning processes, structures, and people; acti-
vating efcient and effective individual and organizational
behaviors; creating accountability for marketing perform-
ance; attracting important nancial, human, and other re-
sources; and engaging in asset management that develops
and deploys marketing assets.
Activities are the basic ingredients of organizations and
are central to strategy, beginning with value chain analysis
and strategy maps (Porter 1996) and advancing to the con-
temporary view that organizations are systems composed of
choices of activities that interact to create a competitive
advantage (Zott and Amit 2010). The eld of marketing treats
the concept of activities very loosely, with the activities
ascribed to marketing mostly conned to the Four Ps. This Bearden 2005), while employee knowledge about customers
narrow view fails to capture many of the vital marketing roles
emergent in the literature on marketing organization (sum-
marized in Web Appendix Table W5). It also limits the menu
of action levers marketing leaders consider, which diminishes
marketings contributions.
The 7As perform their important functions within the
marketing strategy process, which begins with designing
strategic choices regarding where to play and how to win,
then proceeds through implementing strategy decisions and
assessing results. Supporting this process is a resourcing
cycle in which marketing and nonmarketing resources are
acquired, developed, and deployed in the process. This cycle
iterates so that assessment and resource outcomes drive
future design and implementation activities. We nest the 7As
within this familiar marketing strategy process but emphasize
the 7As because they are clear, value-adding activities
that marketers should perform in the marketing strategy
process. The 7As serve as a theoretically grounded description
of the marketing activities needed to advance marketing
excellence.
Next, we review the literature for each of the 7As, with an
eye toward describing how the four elements of marketing
organization contribute to the quality of these activities (for a
detailed summary, see Web Appendix Table W5). In addi-
tion, we offer questions to facilitate further research for each
activity.
How Does MARKORG Inuence the
Design of Marketing Strategy?
Marketing strategy design involves the choice of markets,
value propositions, and business models. MARKORG
shapes strategy design through two marketing activities.
First, when performed effectively, anticipation activities
provide an early and accurate understanding of external
threats and opportunities so the rm can serve the market
better than competitors and even mold the market to its
advantage. Second, an increasingly volatile, complex, and
ambiguous business world requires that marketers con-
tinuously adapt their organization to stay competitive.
Adaptation activities enable changes in rm strategy and
organization.
Anticipation Activities
Early market sensing allows the rm to prepare for the future
ahead of competitors. How does MARKORG enable such
anticipation activities? Research has indicated that market
orientation capabilities should improve rm anticipation,
including early market entry (see Kohli and Jaworski 1990;
Srinivasan, Lilien, and Rangaswamy 2002). Cultural values
focused on the customer emphasize regular collection of
related information (Deshpande, Farley, and Webster 1993),
and a cultural focus on the future increases the likelihood of
introducing radical innovation (Yadav, Prabhu, and Chandy
2007). Conguration choices about market-based reward
systems increase attention to the acquisition, dissemination,
and use of market information (Kirca, Jayachandran, and
improves customer management (Homburg, Wieseke, and
Organizing for Marketing Excellence / 27
Bornemann 2009) and account protability (Mullins et al.
2014) (for details, see Web Appendix Table W5).
Future research priorities. First, there is a need to un-
derstand the informational role that marketing leaders play
in generating growth opportunities (Boyd, Chandy, and
Cunha 2010). What are the traits and behaviors of marketing
leaders who effectively perform this role? Second, can
employees and leaders be trained to anticipate effectively?
Third, what are the optimal organizational structures for
facilitating anticipation?
Adaptation Activities
How does MARKORG enable adaptation activities? Scholars
agree that market learning capabilities are a critical input to
adaptation. However, agreement ends there. Research has
adopted one of two approaches for other capabilities
important to adaptation. Day (2011) focuses on two key
learning toolsadaptive market experimentation (targeted
experiments for trial-and-error learning) and open mar-
keting (utilizing partners resources for transformation).
Other research has focused on more general rm adaptation
capabilities (resource reconguration and capability enhance-
ment; Morgan 2012) and strategic exibility capabilities
(Grewal and Tansuhaj 2001). Cultural elements are also
important to adaptation, including a rms willingness to
cannibalize current offerings or empower product cham-
pions (Tellis, Prabhu, and Chandy 2009). In the structure
area, a cross-functional key account management structure
is the most responsive to market changes (Homberg, Workman,
and Jensen 2002) while customer-oriented structures are more
important in highly competitive industries (Lee et al. 2015).
Finally, marketing leaders help bring about the change to a
market-oriented culture and the introduction of new programs
and strategies (see Web Appendix Table W5).
Future research priorities. An important challenge to
adaptation is that organizations are not naturally designed for
the simultaneous exploitation of current strategies and the
exploration of new strategies (March 1991). One promising
approach is research on ambidexterity that recommends
separating the marketing organizational elements of new
ventures from the rms existing businesses (OReilly and
Tushman 2004). We add that utilizing structures based on
customer segments (Lee et al. 2015) may guide the rm
through adaptation given that customer relationships can
provide stable cash ows while offering insight into cus-
tomers unmet needs and adjacencies. What types of incen-
tives and metrics are best used to counterbalance the emphasis
on current performance with commitments to future oppor-
tunities? Are the CMO effects observed by Germann, Ebbes,
and Grewal (2015) stronger in more turbulent markets? If so,
what leader behaviors produce positive outcomes in such
trying times? Finally, regarding the supportive role of culture,
are there bridging values, such as respect and perspective
taking (Gebhardt, Carpenter, and Sherry 2006) or exibility
(Grewal and Tansuhaj 2001), that help rms change?
28 / Journal of Marketing: AMA/MSI Special Issue, November 2016
How Does MARKORG Inuence
the Implementation of
Marketing Strategy?
Implementing a marketing strategy involves the choice of
marketing programs and the deployment of marketing re-
sources (Slotegraaf, Moorman, and Inman 2003). MARKORG
inuences this stage through alignment activities that link
and coordinate the rms processes, structures, and people
to improve the efciency and effectiveness of marketing
strategies as well as through activation activities to motivate
and inspire individual and organizational behaviors.
Alignment Activities
Alignment is facilitated by several conguration elements
adopting a key account management structure (Homburg,
Workman, and Jensen 2002); strengthening cooperation
between marketing, sales, and R&D (Ernst, Hoyer, and
Ru bsaamen 2010); and improving marketings knowledge
and skills to connect the customer to other functions (Moorman
and Rust 1999). The coherence of market-oriented values,
norms, behaviors, and artifacts aligns through hiring, training,
and rewards (Gebhardt, Carpenter, and Sherry 2006). Align-
ment is also aided when marketing leaders stimulate rm-
employee identication (Wieseke et al. 2009) and when
employees match brand personalities (Siranni et al. 2013).
Future research priorities. Is alignment between the
people and the rms processes and structures best achieved
by hiring employees for t or training for t? What are the
best metrics for diagnosing alignment problems? Are metrics
such as employee satisfaction an early signal of lack of
alignment in people and structure? More research is needed
on integrating capabilities such as CRM, brand management,
and new product development, which require aligning dif-
ferent functions to work together toward shared rm out-
comes (Srivastava, Shervani, and Fahey 1999).
Activation Activities
How does MARKORG enable activation activities that
motivate and inspire individual and organizational behav-
iors? Underlying cultural values such as the idea that the
rms raison detre is to serve the market (Gebhardt,
Carpenter, and Sherry 2006) and that employees are re-
sponsible for rm success (Homburg and Pesser 2000)
inuence a key form of activationmarket-oriented behaviors
among employees. The effect of these values is mediated by
the presence of cultural artifacts including stories, physical
arrangements, and rituals that keep this aspect of culture in the
forefront of day-to-day activities. Research has also shown that
movement toward a market-oriented culture is intrinsically
motivating for employees (Gebhardt, Carpenter, and Sherry
2006). Other employee traits also fuel activation, including the
individual employees trait of customer orientation (Zablah
et al. 2012).
Marketing leaders play a prominent role in stimulating
and socializing employees (see Web Appendix Table W5).
This exciting area of research uncovers the types of behaviors
(transactional vs. transformational; Morhart, Herzog, and
Tomczak 2009) as well as the effect of matching traits and
behaviors (charisma and organizational identication; Wieseke
et al. 2009) on employee identication and brand cham-
pioning outcomes. Marketing leaders can also leverage a range
of incentives and controls to motivate and inspire individual and
organizational behavior. For example, market orientation is
fostered by stronger behavior-based evaluations, market-based
reward systems, and professional controls.
Future research priorities. Research is needed to un-
derstand employee-level customer orientation ex ante so
that rms can screen on this trait. In addition, we know that
organizational structure inuences communication ows
(Menon and Varadarajan 1992) and belief systems (Houston
et al. 2001). What are the best mechanisms for translating
these information outcomes into motivated leaders and
employees? Finally, incentives and controls have been
investigated for their impact on goal achievement, such as
reaching quota (Chung, Steenburgh, and Sudhir 2014) or
winning a contest (Lim, Ahearne, and Ham 2009), and on
curbing free-riding (Toubia 2006) or opportunism (Heide,
Wathne, and Rokkan 2007). What is the effect of such
incentives on extrarole employee behaviors (e.g., repre-
senting the brand), positive word of mouth, and employee
tenure levels?
How Does MARKORG Inuence the
Assessment of Marketing Strategy?
Accountability Activities
Marketing strategies emerge from a continuous learning
process, with the assessment stage signaling the end of one
cycle and a look ahead to the next development cycle. The
bridge to the next cycle is a monitoring and control system to
compare the realized performance with objectives and to
learn what needs to change in the future. This process
involves accountability activities that manage responsi-
bility for rm performance. MARKORG has important
effects on this aspect of strategy through conguration
elements, including building a strong marketing function
(Verhoef and Leeang 2009), through the use of incentive
and control systems that inuence decision-making criteria
(Hauser, Simester, and Wernerfelt 1994), and through the
use of metrics that offer performance feedback information
(Mintz and Currim 2013).
Future research priorities. First, research has shown
that telling managers they will be called on for their opinions
leads them to emphasize information that is more acceptable
to their superiors rather than the most accurate information
(Brown 1999); thus, accountability is likely to require a more
nuanced approach. What structural and cultural elements
play a supporting role in furthering accountability? Second,
with regard to structure, how should accountability for cross-
functional activities be shared to maximize marketing
excellence? Third, managers and employees are likely to vary
in terms of the extent to which they are responsible for and are
motivated by accountability. Vetting candidates for this trait
should boost rm accountability. Fourth, how should
marketing leaders manage the delivery of immediate nancial
results without jeopardizing longer-term customer and product-
market outcomes? How can accountability for societal con-
sequences be incorporated (Wilkie and Moore 2007)? One
solution is to develop deeply held values around either con-
scious capitalism (Mackey and Sisodia 2014) or a purpose-
driven business that guide the rm to be accountable to a range
of stakeholders.
How Does MARKORG Inuence the
Resourcing of Marketing Strategy?
The marketing strategy process is fueled by rm resources
including human, nancial, knowledge, brand, and customer
assetsand related capabilities (Srivastava, Shervani, and
Fahey 1998). These resources both enable and constrain
rm choices (Morgan 2012). We use the term resourcing
to convey that managers make decisions about which re-
sources are important and how resources will be developed
and leveraged in the marketing strategy process.13 Excellent
marketing organizations do so by directing MARKORG to
enable the attraction of resources and asset management
activities that fully develop and effectively deploy mar-
keting assets.
Attraction Activities
A handful of studies have examined how the MARKORG
elements are successfully mobilized and deployed to attract
resources. Research has shown that experienced marketing
leaders help attract rm venture capital funding (Homburg
et al. 2014) and that customer and competitor orientations
inuence initial public offering outcomes (Saboo and Grewal
2013), while rms with stronger brands attract higher-quality
employees (Luo and Homburg 2007) at lower pay (Tavassoli,
Sorescu, and Chandy 2014), and rms with strong relational
capabilities attract good partners (Johnson, Sohi, and Grewal
2004).
Future research priorities. It is difcult for external
audiences such as potential investors, partners, and employees
to fully appreciate the value of a rms MARKORG. Which
signals of rm marketing organization prowess should a rm
send to outside stakeholders to increase its attractiveness as an
investment (see Moorman et al. 2012), employer, and partner?
What criteria do stakeholders use to evaluate the quality of
MARKORG and decide whether to engage the rm? Attract-
ing internal resources is also critical because it endorses the
importance of the function and improves the odds that marketing
activities will succeed. Yet little is known about how individual,
organizational, and inuence-strategy factors predict a marketing
leaders success in attracting resources within the rm.
Asset Management
MARKORG inuences asset management. Market orienta-
tion capabilities facilitate strong customer relationships and
13Intermediate rm performance outcomes, such as customer and
brand equity, then reenter the process for use in future cycles of the
marketing strategy process.
Organizing for Marketing Excellence / 29
employee outcomes (Kirca, Jayachandran, and Bearden 2005).
For conguration, a strong marketing function improves the
rms long-term development and short-term leveraging of
market-based assets (Feng, Morgan, and Rego 2015). In the
area of human capital, rms with CMOs have a higher Tobins
q (Germann, Ebbes, and Grewal 2015), and satised marketing
employees create satised customers (Kamakura et al. 2002).
Future research priorities. Future studies should address
why the marketing organization often fails to facilitate the
development and leveraging of market-based assets. One
reason is that marketing performance systems do not include
metrics that measure the quality of a rms market-based
assets or their cash ow effects (Srivastava, Shervani, and Fahey
1998). A second reason may be that rms lack metrics for
evaluating the quality of their capabilities for developing and
leveraging these market-based assets. Third, rms often lack
capabilities for these critical activities, and so brands, cus-
tomers, and knowledge are not managed as powerful assets.
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The MSI priorities indicate a discontinuity in the practice of
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Organizing for Marketing Excellence / 35
 1

WEB APPENDIX

ORGANIZING FOR MARKETING EXCELLENCE

Christine Moorman & George S. Day

TABLE W1. THE MARKETING LITERATURE ON CAPABILITIES

Topics Findings
Market information/knowledge capabilities
- Kohli and Jaworski (1990): Describe the firms market orientation as the (1) organization-wide generation of market
intelligence pertaining to current and future customer needs, (2) dissemination of the intelligence across departments, and (3)
organization-wide responsiveness to it. Subsequent work offers measures for each of these activities (see Jaworski and Kohli
1993; Kohli, Jaworski, and Kumar 1993).
- Narver and Slater (1990): Identify capabilities involving a firms customer orientation and competitor orientation, both of
which ensure the firm understands the market. They also describe the firms interfunctional coordination, which is a
coordinated utilization of company resources to create superior value for target customers.
- Day (1994): Describes a market sensing capability, which includes an array of firm activities for learning about markets.
- Moorman (1995): Examines organizational market information processes that reflect the ability to generate and disseminate
market information and a broader array of utilization activities, including conceptual use (changing mental models) and
What are
using information to plan, implement, and evaluate market decisions.
marketing
- Vorhies and Morgan (2005): Describe a firms market information management capabilities measured by the firms ability to
capabilities?
track customer wants and needs, to make full use of marketing research information, and to analyze market information.
- Narasimhan, Rajiv and Dutta (2006): Measure the firms external absorptive capacity, which reflects the ability to use
external information.
Customer management capabilities
- Day (1994): Customer linking is firm knowledge and skills at initiating, maintaining, and terminating relationships with its
most valuable customers.
- Srivastava, Shervani and Fahey (1999): A marketing perspective should directly influence a firms customer relationship
management processes, defined as the activities that identify customers, create customer knowledge, build customer
relationships, and shape their perceptions of the organization and its products.
- Reinartz, Krafft and Hoyer (2004): View the CRM process as the proactive management of valuable customers (measured by
life-time value) as they move from initiation to maintenance to termination. Effective management of the CRM capability
 2

involves much more than databases, analytics, and information technology, and comprises activities ranging from
prospecting to tracking the costs of retention to up-selling and cross-selling.
- Morgan, Slotegraaf, and Vorhies (2009): Define a firms customer relationship management capability as the firms ability
to identify attractive customers and prospects, initiate and maintain relationships into customer-level profits. Measures are
taken relative to competitors and include, for example, identifying and targeting attractive customers, maintaining loyalty
among attractive customers, and enhancing the quality of relationships with attractive customers.
Channel and alliance management capabilities
- Day (1994): Channel bonding is firm knowledge and skills at creating tight working connections with key channel
partners.
- Kumar, Scheer and Steenkamp (1998): Firms vary in their punitive capabilities, defined as the ability to use intentional acts
to inflict negative consequences on partners.
- Selnes and Sallis (2003): Measure a firms relationship learning capability, defined as an ongoing activity between
customers and suppliers that shares, makes sense of, and integrates acquired information into a shared memory that improves
the range or likelihood of potential relationship-specific behaviors.
- Johnson, Sohi and Grewal (2004): Argue for the presence of a relational capability by examining the effect of interactional,
functional, and environmental knowledge stores on the quality of a firms interorganizational relationships.
- Swaminathan and Moorman (2009): A firms (partners) marketing alliance capability reflects its ability to create value from
previous marketing alliances.
Brand management capabilities
- Morgan, Slotegraaf, and Vorhies (2009): Define a firms brand management capability as the ability to create and maintain
high levels of brand equity and to deploy this resource in ways that are aligned with the market environment. Measures are
taken relative to competitors and include, for example, using customer insights to identify valuable brand positioning,
establishing desired brand associations in customers minds, and achieving high levels of brand awareness in the market.
- Although the connection to a brand management capability is not established, research examines brand equity (Keller 1993;
Aaker and Jacobson 1994) and the performance effects of various brand-related activities related to cobranding (Cao and
Sorescu 2013), brand portfolio management (Morgan and Rego 2009), and brand acquisitions and disposals (Wiles, Morgan
and Rego 2012) that likely reflect presence of brand management capabilities.
Other specialized marketing capabilities
- Dutta, Zbaricki and Bergen (2003): Define and document the presence of firm pricing capabilities, which reflect knowledge
and skills that create and appropriate value.
- Mizik and Jacobson (2003): Define value appropriation capability as the firms ability to differentiate its offerings and
measure it by examining companies advertising expenditures. Findings indicate that a value appropriation capability has a
positive effect on a firms stock returns.
 3

- Vorhies and Morgan (2005): Measure pricing, product development, channel management, marketing communication, and
selling capabilities.
- Challagalla, Venkatesh, and Kohli (2009) identify the presence of proactive post-sales service capability comprised of
proactive prevention, proactive education, and proactive feedback seeking activities.
Other strategic marketing capabilities
- Vorhies and Morgan (2005): Measure marketing planning and marketing implementation capabilities (see also Morgan,
Vorhies and Mason 2009).
- Morgan (2012): Defines four sets of marketing capabilities: specialized (see Vorhies and Morgan 2005), cross-functional
(brand management, customer relationship management, and new product development), architectural (strategic market
planning, including segmentation, targeting, and positioning and marketing strategy implementation), and dynamic (market
learning, resource reconfiguration, and capability enhancement).
- Feng, Morgan, and Rego (2015): A firms long-run market-based asset building capability is the firms ability to use
available resources to build and maintain its market-based assets and a firms short-run market-based asset leveraging
capability is the firms ability to use its resources to generate short-term cash flows from its current market-based assets.
- Measure spending: Mizik and Jacobson (2003) examine the firms strategic emphasis on a value creation capability (as
measured by R&D spending) relative to a value appropriation capability (as measured by advertising spending).
- Measure effects of spending: Moorman and Slotegraaf (1998) measure a firms marketing capability through its market
share. Johnson, Sohi, and Grewal (2004) argue for the presence of a firms relational capability by measuring the effect of its
interactional, functional, and environmental knowledge stores (which house capabilities) on the performance of a firms
relationship portfolio and the quality of its relationships.
How are
- Measure the effectiveness of converting inputs to outputs: Dutta, Narasimhan, and Surendra (1999) measure marketing
marketing
capabilities and other measures for operations and R&D capabilities (see also Narasimhan, Rajiv, and Dutta 2006).
capabilities
- Survey/Interview key informants: Reinartz, Krafft, and Hoyer (2004) measure a firms CRM processes by surveying senior
measured?
executives. Challagalla, Venkatesh, and Kohli (2009) interview managers across industries to identify a proactive post-sales
service capability.
- Benchmark the firm against competitors: Firm and competitor scores on capabilities can be derived from any of the
aforementioned approaches. Vorhies and Morgan (2005) provide overview of choices firms need to make in this process,
including the number of comparison firms, whether the comparison firms should be in the firms industry or pursuing a
similar strategy, and whether or not they should be top-performing firms (see also Kabadayi, Eyuboglu, and Thomas 2007).
What is the - Jaworski and Kohli (1993): A firms market orientation capabilities have a positive effect on its overall business
contribution of performance.
marketing - Dutta, Narasimhan, and Rajiv (1999): Marketing capabilities have a positive and significant effect on firm profitability.
 4

capabilities to - Srinivasan, Lilien, and Rangaswamy (2002): A firms technological opportunism, defined as a sense-and-respond capability
performance? of the firm with respect to new technologies, influences the adoption of radical technologies.
- Matsuno, Mentzer, and zsomer (2002): Market orientation has a positive effect on relative market share, percent of new
product sales to total sales, and ROI.
- Vorhies and Morgan (2005): Eight marketing capabilities (product development, pricing, channel management, marketing
communication, selling, marketing information management, marketing planning, and marketing implementation) are
positively and directly related to firm performance.
- Kirca, Jayachandran, and Bearden (2005): Market orientation capabilities affect organizational performance by increasing a
firms innovativeness, which in turn, influences customer loyalty and quality perceptions. These mediating mechanisms do
not eliminate the direct effect of market orientation on organizational performance, but they do offer an important means by
which market orientation works (see also Han, Kim, and Srivastava 1998).
- Narasimhan, Rajiv, and Dutta (2006): A firms external absorptive capacity predicts firm profits.
- Gu, Hung, and Tse (2008): A firms corporate channel capability is positively related to the firms market performance.
- Krasnikov and Jayachandran (2008): Meta-analysis of the impact of marketing, R&D, and operations capabilities on firm
performance. Results indicate that capabilities predict firm performance and that marketing capabilities have a stronger
effect on firm performance than R&D and operations capabilities. This effect was stronger for measures of market
performance (e.g., sales and market share) than for efficiency measures (e.g., ROI).
- Voss and Voss (2008): The presence of a firms adaptive learning orientation moderates the effect of high levels of
competitive density on theatre net incomes.
- Bahadir, Bharadwaj, and Srivastava (2008): Both target and acquirer marketing capabilities have a positive effect on the
valuation of a targets brand portfolio during M&A. The positive effect of the target's marketing capability on its brand
portfolio value is weaker when an M&A strategy is synergistic and when it has higher sales growth.
- Swaminathan and Moorman (2009): A firms (partners) marketing alliance capability has a positive (negative) impact on
firm abnormal returns to alliance announcement.
- Kumar, Jones, Venkatesan, and Leone (2011): The effect of market orientation on sales and profits is positive across three
surveys of business performance from 1997-2005. However, the effect of market orientation on these financial outcomes
diminishes over time suggesting the contributions of market orientation have weakened over time with the greatest benefits
accruing to early adopters. The carryover effect of market orientation on profits is greater than the carryover effect on sales.
Greater market and technological turbulence and competitive intensity also moderate these effects increasing the importance
of market orientation to business performance.
- Xiong and Bharadwaj (2011): A young firms marketing absorptive capacity, defined as the firms efficiency in absorbing
marketing know-how, improves its ability to leverage marketing alliance relationships which influences IPO value.
 5

- Wiles, Morgan, and Rego (2012): Acquirer (seller) abnormal returns are greater when the acquirer has strong (weak)
marketing capabilities, defined as its ability to define, develop, and deliver value to customers by combining and deploying
its available resources.
- Ulaga and Reinartz (2012): Five firm distinctive capabilities for managing hybrid strategies (i.e., service-related data process
and interpretation, execution risk assessment and mitigation, design-to-service, hybrid offering sales, and hybrid offering
deployment) offer firm differentiation and cost-leadership positional advantages.
- Xiong and Bharadwaj (2013): Firm marketing capabilities have a positive effect on how the stock market reacts to news
released by companiesdampening the effect of negative news and amplifying the effect of positive news.
- Fang, Lee, and Yang (2015): Downstream (upstream) firm alliance capability has a positive effect on downstream
(upstream) firm abnormal returns.
- Kohli and Jaworski (1990); Jaworski and Kohli (1993): Antecedents to a firms market orientation include (i) top
managements emphasis on the customer; (ii) a high degree of interdepartmental connectedness; (iii) a low (high) level of
organization centralization and formalization for market information acquisition and information dissemination (information
responsiveness); and (iv) the use of metrics and incentives to reward employees for market-oriented behaviors.
- Bharadwaj, Varadarajan, and Fahy (1993): Examine the characteristics of service industries that give rise to the competitive
advantage of its skills and resources, including scale effects, costs and demand synergies, brand equity, and culture as well as
How are the moderating role of the experience and credence qualities of the service.
superior - Kirca, Jayachandran, and Bearden (2005): Meta-analysis finds support for the Jaworski and Kohli findings.
marketing - Vorhies and Morgan (2005): Firms can develop new capabilities by benchmarking from high-performing competitors.
capabilities - Gu, Hung, and Tse (2008): Guanxi or durable social connections and networks a firm uses to exchange favors for
developed? organizational purposes, facilitate the development of channel capability (e.g., Our brand owns effective distribution
channels) and responsive capability (e.g., We are able to respond properly to market changes).
- Feng, Morgan, and Rego (2015): Strong marketing capabilities accrue from powerful marketing departments. Although not
examined empirically, marketing department power influences the development of firm-level marketing capabilities through
resource attraction and interfunctional coordination activities.
- Banerjee, Prabhu, and Chandy (2015): Firms can develop new capabilities through indirect learning from leaders, partners,
and competitors.
How are - Sinkula (1994): Firms have meta-level learning capabilities that reflect the ability to learn to learn.
marketing - Slater and Narver (1995): Firms engage in both adaptive learning (exploiting current knowledge and skills) and generating
capabilities learning (exploring new knowledge and skills).
changed? - Prabhu, Chandy, and Ellis (2005): Firms need internal knowledge in order to absorb knowledge from acquisitions. This is
the absorptive capacity of Cohen and Levinthal (1990).
 6

- Atuahene-Gima (2005): Firms with a strong market orientation are able to explore and exploit their capabilities in market
orientation.
- Fang, Palmatier, and Steenkamp (2008): Examine dynamic capabilities that help reconfigure a firms resources from offering
products to both products and services.
- Day (2011): Three adaptive firm capabilities to facilitate changevigilant market learning, adaptive market
experimentation, and open marketing.
- Morgan (2012): Change depends on the presence of firm capabilities in resource reconfiguration (i.e., ability to retain,
eliminate, and acquire resources) and capability enhancement (i.e., ability to retain, eliminate, acquire, and improve
capabilities).
- Palmatier et al. (2013): Examine a firms dynamic capabilities for communicating and investing in evolving channel
relationships.
 7

TABLE W2. THE MARKETING LITERATURE ON ORGANIZATIONAL CONFIGURATION

A. Organizational Structure
Topics Findings
- Moorman and Rust (1999): The marketing functions ability to facilitate the connection between the customer and different
parts of the firm has a positive impact on firm financial performance, customer relationship performance, and new product
performance, beyond the effect of a firms market orientation.
- Verhoef and Leeflang (2009): There is no direct effect of marketing department influence on firm performance. A firms
What is the
market orientation mediates the effect of marketing department influence on business performance.
contribution
- Verhoef et al. (2011): There is a direct effect of marketing function ability on customer connections and business
of the
performance across seven industrialized countries.
marketing
- Homburg, Vomberg, Enke, and Grimm (2015): The marketing departments influence on eleven different firm activities has
function to
a positive effect on firm financial and customer relationship performance.
firm
- Feng, Morgan, and Rego (2015): Measure marketing department power using four indicators: (1) percent of marketing
performance?
executives in the top management team (TMT); (2) marketings ability to garner rewards (marketing executives
compensation relative to other TMT members); (3) marketing executives ranking in the TMT hierarchy; (4) the breadth of
job titles associated with marketing executives in the TMT. Using this measure, marketing department power has increased
from 1993-2008 and has a significant direct effect on total shareholder returns.
- Homburg, Workman, and Krohmer (1999); Homburg, Vomberg, Enke, and Grimm (2015): The marketing function impacts
firm performance by influencing eleven key decision areas important to business unit success (i.e., pricing, distribution,
strategic direction of the business unit, major capital expenditures, advertising messages, expansion into new geographic
markets, new product development, procedures for measuring customer satisfaction, programs for improving customer
satisfaction, design of customer service and support, and choice of strategic business partners).
How does the - Noble and Mokwa (1999): Develops a grounded theory of marketing strategy implementation as the communication,
marketing adoption, and enactment of strategy or initiative, and tests with marketing managers in their boundary spanning role.
function - Moorman and Rust (1999): The marketing function contributes to firm performance by providing knowledge and skills that
contribute to connect the customer to the offering, to the service delivery process, and to financial accountability. Marketings
firm performance on these connection knowledge and skills impacts its perceived value relative to other functions, which has a
performance? positive impact on firm financial performance, customer relationship performance, and new product performanceabove
and beyond the firms market orientation (which reflects a more dispersed view of marketing).
- Verhoef and Leeflang (2009): The marketing departments influence is determined by its accountability, innovativeness, its
customer-connecting role focused on translating customer needs, its creativity, marketing-finance cooperation, marketing-
sales cooperation, and marketing-R&D cooperation. The effect of marketing department influence on business performance
is mediated by a firms market orientation.
 8

- Feng, Morgan, and Rego (2015): Firms market department power increases firm capabilities for long-run market-based
asset building and short-run market-based asset leveraging which fully mediate its effect on short-term ROA performance
and partially mediate its effect on long-term shareholder value.
- Workman, Homburg, and Gruner (1998): Offer an integrative framework that relates structural dimensions (location of
marketing and sales, structure within marketing and sales, and formalization and centralization) and non-structure
dimensions (cross-functional dispersion of marketing activities, power of marketing subunit, and cross-functional
interactions) of the marketing organization to the firms environment.
- Matsuno and Mentzer (2000): Miles and Snow strategy type moderates the market orientation-business performance
relationship.
- Homburg, Workman, and Jensen (2002): Organizing framework examines the following features of key account
management (KAM) design: (1) what is done (activities), who does it (actors), how it is done (resources), and the
formalization of action. The authors uncover eight different KAM structures: top management, middle management,
How is
operating level, cross-functional, unstructured, isolated, country club (high level involvement but less formalized
organizational
procedures), and none. Results indicate that an isolated KAM performed no differently than no KAM and that cross-
structure
functional KAMs were most adaptive to changes in the market and had the highest market performance, while top-
aligned with
management KAMs produced the highest profits.
firm strategy
- Vorhies and Morgan (2003): Fit of a firms strategy type to its marketing organization structural characteristics
and the
(centralization, formalization, and specialization) and task characteristics (marketing capabilities and work group
market?
interdependence) improves firm marketing effectiveness and efficiency.
- Olson, Slater, and Hult (2005): Consider a broad range of industries and find that strategy and marketing organization
interact to influence performance. For example, prospectors are more successful when they operate in decentralized,
informal organizations and emphasize customer and innovation orientations while analyzer firms perform well only if they
have customer and competitor orientations.
- Kabadayi, Eyuboglu, and Thomas (2007): Find that channel structure (formalization, centralization, specialization, number
of channels, and channel directness) fit with firm strategy (Porters differentiation, cost, and focus strategies) and channel
environment (dynamism, complexity, and munificence) influences firm performance. Firm fit is determined relative to the
profile of the top-contributing firms in the industry.
What are the - Moorman, Zaltman, and Deshpand (1992): In a marketing research context, compared to marketing researcher-non-
role and marketing manager relationships, marketer researcher-marketing manager relationships have higher quality interactions, trust
impact of has a stronger effect on quality of interaction, and commitment has a stronger positive effect on the use of research.
marketing in - Griffin and Hauser (1992): Product development teams using more horizontal communication flows where team members
cross- communicate directly with one another were more effective than teams using vertical (up-over-down) information flows
functional through management.
 9

relationships? - Olson, Walker, and Ruekert (1995): The fit of the firms experience with the new product (less experience) and the
formalization of the coordination of resource flows across functions (less formalization) is more important than a certain
type of cross-functional coordination per se.
- Maltz and Kohli (1996): Marketings influence on non-marketers is stronger when marketers use more formal channels of
dissemination.
- Fisher, Maltz, and Jaworski (1997): Marketings influence on engineers is stronger when marketers with a stronger
functional orientation are asked to focus on integrated organizational goals and outcomes that foster a non-functional
orientation.
- Menon, Bharadwaj, Adidam, and Edison (1999): Marketings cross-functional integration has been found to influence
strategy creativity, but not market performance.
- Sethi (2000): The quality of a new product is related to the ability of teams to share information, the influence of customers
during the development process, and the quality orientation of the firm. Time pressure and functional diversity of the team
make-up have no effect.
- Henard and Szymanski (2001): A meta-analyses shows that cross-functional integration plays a very limited role in new
product success.
- Luo, Slotegraaf, and Pan (2006): Cooperative and competitive dynamics on cross-functional teams (i.e., coopetition) produce
the strongest firm performance outcomes.
- De Luca and Kwaku Atuahene-Gima (2007): The specificity of market knowledge and extent of cross-functional
collaboration influence product innovation performance through knowledge integration mechanisms.
- Ernst, Hoyer, and Rbsaamen (2010): Sales-marketing cooperation has a positive effect on overall new product performance
during the concept development and implementation stages of the new product development process. Marketing-R&D
cooperation has a positive effect on the concept development, project development, and implementation stages of the new
product development process.
- Krush, Sohi, and Saini (2015): Intraorganizational sharing of marketing capability responsibilities across functions weakens
marketings influence.
- Workman, Homburg, and Gruner (1998): The antecedents of the choice of where to locate marketing and sales are firm size,
How should
its global orientation, and its market orientation. The organization of marketing and sales is highly influenced by the
firms organize
relatedness of their activities. When related, companies see deeper synergies between the two groups and use a staff
and
marketing and sales organizational form. When unrelated, firms are more likely to use decentralized, autonomous business
coordinate
units.
marketing
- Homburg and Jensen (2007): Companies perform better when marketing and sales have quality cooperation. Differences in
and sales?
orientation and competencies reduce cooperation. Differences in orientation have a direct positive effect on performance,
 10

indicating that sales and marketing differences do not per se negatively affect the firm. When differences reduce the ability
to cooperate, performances declines.
- Tuli, Kohli, and Bharadwaj (2007): Customers have a broader view of solutions as a set of relational processes comprising:
(1) recognition of the customers broader business needs, (2) customization and integration, (3) deployment and installation
to conform to the customers operating situation, and (4) post-deployment support and follow-up. They find that companies
pay inadequate attention to processes 1, 3 and 4. Also find that the sales force is the best means for resolving problems.
- Homburg, Jensen, and Krohmer (2008): Find recurring patterns in the marketing-sales interface based on information
sharing, structural linkages, and the respective goal and time orientations. Five archetypal configurations emerged, with two
performing better than the others because of the high degree of teamwork and joint planning. The most successful archetypes
feature a fairly strong marketing function.
- Ernst, Hoyer, and Rbsaaamen (2010): Sales-marketing cooperation has a positive effect on overall new product
performance during the concept development and implementation stages of the new product development process.
- Moorman, Zaltman, and Deshpand (1992): In a marketing research context, intraorganizational dyads had stronger
relational outcomes but there was difference in the utilization of market research for intra- versus interorganizational dyads.
As a moderator, intraorganizational dyads had stronger commitment, quality of interaction, and researcher involvement and
commitment had a stronger effect on research use. However, quality of interaction had a stronger effect on research use in
interorganizational dyads.
- Villas-Boas (1994): The decision to share the same agency with a competitor depends on three effects: (1) the decision-
making framework effect (value of outside information), (2) the strategic effect (the competitors reaction to the firms
situation is especially harmful in a particular situation), and (3) the uncertainty effect (the competitors actions are
increasingly harmful). The first effect always favors sharing the same agency. The direction of the latter two effects is
Does
ambiguous. This ambiguity is resolved against the sharing of agencies when (1) the competitor's reaction to the firm's
outsourcing
situation is especially harmful in that particular situation (strategic effect) and (2) the competitor's actions are increasingly
affect firm
harmful (uncertainty effect).
performance?
- Stremersch, Weiss, Dellaert, and Frambach (2003): In the area of modular technology systems, firms prefer to keep activities
in-house as their tacit know-how increases, when they have moderate know-how levels, and technological volatility is high.
- Carson (2007): Findings support the conclusion that clients should use more ex ante control and less ex post control to
govern highly creative tasks.
- Anderson (2008): The greater the difficulty of evaluating a salesperson's performance, the more likely the firm is to use a
direct sales force. Direct sales forces are also associated with complex, hard-to-learn product lines and with districts that
demand considerable non-selling activities.
- Raassens, Wuyts, and Geyskens (2012): There is a positive response from the stock market when firms make a new product
outsourcing announcement; however, there was not a contrast group of firms that performed the tasks internally. The authors
 11

suggest that the success of using different control strategies (minority equity participation in the outsourcing provider versus
selecting a provider to whom the outsourcing firm has outsourced NPD in the past) depends on technological uncertainty and
cultural uncertainty. Cultural (technological) uncertainty reduces (increases) the value of equity participation while
increasing (decreasing) the value of relying on past partners.
- Homburg, Workman, and Jensen (2000): Define customer-focused organizational structure as an organizational structure
that uses groups of customers related by industry, application, usage situation, or some other nongeographic similarity as the
primary basis for structuring the organization. The authors argue that a customer structure is an important antecedent of
How does a
market orientation and that the likelihood of a customer structure increases as customer decision making across geographies
customer-
becomes more centralized and as customers access information that allows product and price comparisons across
based
geographies. The authors document the evolution from functional organizations to product-focused business units to
organizational
customer-focused business units, including how the organizations culture, information systems, accounting systems, and
structure
reward systems also need to change for the customer structure to operate effectively.
affect firm
- Lee et al. (2015): Find that a customer structure increases firm coordinating costs which reduces firm financial performance
performance?
and increases firm customer satisfaction which increases firm financial performance. However, the latter effect appears to
only hold for firms in industries where competitors have not yet implemented similar structures or where competitive
intensity is high.

B. Metrics Use
Topics Findings
-Jaworski and Kohli (1993): Measure the intelligence generation component of market orientation including these metrics: (1)
We poll end users at least once a year to assess the quality of our products and services and (2) We often talk with or survey
those who can influence our end users purchases (e.g., distributors).
-Jaworski and Kohli (1993): Measure the use of market-based metrics in the firms reward system: (1) customer satisfaction
assessments influence senior managers pay; (2) salespeoples performance is measured by the strength of relationships they
build with customers; and (3) customer polls are used to evaluate salespeople.
What metrics
-Moorman (1995): Measures the use of market information to evaluate marketing decisions as part of the instrumental use of
do firms
market information. Questions focus on extent to which firm has processes: (1) that formally evaluated the effectiveness of
utilize?
the project; (2) that provided informal feedback regarding the effectiveness of the project; (3) that provided feedback to
decision makers regarding the outcomes of their project decisions; (4) that constructively evaluated project outcomes; and
(5) that encouraged managers to understand the reasons for their mistakes throughout the project.
-Bucklin and Gupta (1999): Commercial use of metrics associated with UPC scanner data tend to focus on consumer
promotions (i.e., coupons), trade promotions, and pricing but less so on product strategy, advertising, and distribution
management.
 12

-Vorhies and Morgan (2005): Monitoring marketing performance is not part of the firms marketing implementation
capability; it operates independently.
-Morgan, Anderson, and Mittal (2005): Offer insights into the processes firms engage in during use of customer satisfaction
information (CSI). Authors find that CSI is used more selectively and primarily in the areas of customer service and account
management. Also find that companies report more instrumental use of CSI compared to the conceptual use of CSI.
-OSullivan and Abela (2007): Firms vary in the ability to use marketing performance measurement activities, defined as the
assessment of the relationship between marketing activities and business performance. The activities cover twelve areas
that align around four domains reflecting the ability to measure performance in: (1) management and analysis activities; (2)
direct/online marketing; (3) brand and advertising; and (4) public relations.
-Wiesel, Pauwels, and Arts (2011): Report a cultural shift that introduced more rigor to marketing fund allocation process,
altered mental modes of decision makers, and increased the importance of marketing analytics in organizations.
-Homburg, Artz, and Wieseke (2012): Examine the comprehensiveness of a firms marketing performance measurement
system based on three qualities: (1) the system has breadth, including financial and nonfinancial measures and leading and
lagging measures of marketing performance; (2) the system reflects the firms goals and strategies; (3) the system provides
information about the relationship between marketing actions (causes) and outcomes (effects).
-Skiera and Nabout (2013): Observe a cultural shift from rules of thumb to optimal DSS with visualization to understand the
impact of marketing decisions.
-Mintz and Currim (2013): Marketers use both marketing and financial metrics with a higher use of marketing metrics (see
Table 1). Among the most commonly used marketing metrics are awareness (41% of firms), total customers (37%), and
market share (28%) and the most commonly used financial metrics are total volume (units or sales; 43%), ROI (36%), and
net profits (28%).
-Blattberg and Hoch (1990): Decision making is optimized when simple database models and metrics are combined with
managerial intuition50% manager and 50% model is ideal.
-Moorman (1995): The use of market information to evaluate marketing decisions has a positive effect on new product
financial performance and timeliness among consumer packaged goods companies.
Does the use
-Armstrong and Callopy (1996): Experimental and field study results indicate the use of competitor-based metrics (e.g.,
of metrics
market share) reduces firm survival and profits.
contribute to
-Rust, Moorman, and Dickson (2002): Firms using quality measures with a revenue emphasis to return on quality outperform
firm
firms using quality measures with a cost emphasis or a dual emphasis that reflects both revenues and costs.
performance?
-Mittal, Anderson, Sayrak, and Tadikamalla (2005): Firms that achieve a dual emphasis outperform firms in the long-run that
use only customer satisfaction or cost metrics.
-OSullivan and Abela (2007): There is a positive relationship between marketing performance measurement scores and firm
performance (measured by sales growth, market share, and profitability relative to the competition), CEO satisfaction with
 13

marketing (from primary data), and ROA and stock returns (from secondary data). The use of a marketing dashboard does
not explain any variance in the firms subjective and objective performance once the model has accounted for the number of
marketing metrics used by the company.
-Homburg, Artz, and Wieseke (2012): The comprehensiveness of a firms marketing performance measurement system is
positively related to the alignment of a firms marketing activities (extent to which managers execute their tasks in line with
strategic marketing objectives) and market knowledge (extent to which structured and organized organizational knowledge
about the market exists). These intermediate activities, in turn, are shown to improve the firms return on sales, return on
assets, and market performance relative to the competition.
-Mintz and Currim (2013): Report a positive relationship between the number of marketing metrics and financial metrics used
and perceptions of marketing-mix performance, measured by customer satisfaction, customer loyalty, sales, market share,
profitability, and ROI.
-Deshpand and Zaltman (1982): Managers are more likely to use market research high on the following qualities: technical
quality, presentation quality, actionability, the confirmatory nature of research, and political acceptability of the results.
-Deshpand and Zaltman (1982); Maltz and Kohli (1996): Intelligence disseminated in more formalized and centralized
organizations or received through more formal channels is used more than intelligence obtained through informal channels
or in less formalized and centralized organizations.
-Moorman, Zaltman, and Deshpand (1992): As the quality of the relationship improves, and the communication and
commitment between provider and user increases, marketing research is more likely to be used.
-Menon and Varadarajan (1992): Offer a conceptual framework that examines the direct effect of environmental factors,
organizational structure, information and innovation culture, and perceived task complexity on the type and extent of
knowledge use, which may include metrics. These antecedents are also theorized to influence internal and external
What factors
communication flows, which influence the cost of information and its perceived credibility and which, in turn, influence
affect the use
knowledge utilization.
of metrics?
-Day and Nedungadi (1994): The type of market research use is influenced by whether the firm is focused on both customers
and competitors (market-driven), customers (customer oriented), competitors (competitor oriented), or neither customers nor
competitors (self-centered).
-Menon, Bharadwaj, Adidam, and Edison (1999): Companies making stronger resource commitments, those with more
creative strategies, and companies operating in turbulent environments report higher organizational learning from strategy
actions.
-Wierenga, Van Bruggen, and Staelin (1999): Model the decision, the decision environment, and the decision maker in a
model that matches supply and demand for marketing decision support systems.
-Barwise and Farley (2003): Examine metric use in five industrial countriesU.S., U.K., Germany, Japan, and France.
German firms are the heaviest users of metrics and Japanese firms are the lowest users.
 14

-Lilien, Roberts, and Shankar (2013): Survey and interview data from nine years of ISMS-MSI Practice Prize winners
indicate that simpler, easy-to use models, organizational buy-in achieved through champions, in-house presentations, pilots,
cross-functional involvement, and sharing the same language as influential executives increases the use of marketing models
in organizations.
-Mintz and Currim (2013): Examine firm, managerial, environmental, and marketing mix factors related to the use of
marketing and financial metrics. In terms of firm factors, market orientation is positively related to marketing metric use but
not financial metric use, whereas the presence of a CMO is just the opposite. Being a B2C company and recent positive
business performance are both positively related to the use of both types of metrics, while being a services company is
negatively related to the use of both types of metrics. Firm metric training level and metric-based compensation are
positively related to the use of both types of metrics. In general, individual manager characteristics are not related to
marketing metric use, while managerial experience is negatively related to use of financial metrics and quantitative
background is positively related to financial metric use. In terms of environmental characteristics, market turbulence is
associated with more metric use as is industry concentration. Late stage product life cycles and market growth are negatively
related to the use of market metrics and unrelated to the use of financial metrics. Metric use varies by type of marketing mix
activity with financial metrics more likely to be used compared to marketing metric use (see Table 5 in Mintz and Currim
2013 for details).
-Lilien, Roberts, and Shankar (2013): The following factors give rise to the adoption of models submitted for the ISMS-MSI
Practice Prize, which usually include critical metricsthe use of simpler, easier-to-use models, organizational buy-in
fostered by a high-level champion, holding in-house presentations and dialogue, performing pilot assignments, involving
multi-department personnel, and speaking the same language as influential executives.

C. Incentives and Controls

Topics Findings
General:
- Jaworski and MacInnis (1989): Marketing agents engage in four dysfunctional behaviors to further their own self-interests.
Gaming refers to the tendency of agents to comply with a control system that rewards them in the short run but that hurts the
How do
company in the long run. Smoothing refers to changing behavior to make performance appear more consistent over time
marketers
Focusing is the tendency to selectively attend to information that supports a self-interested path. Inaccurate reporting is the
misbehave?
tendency of agents to knowingly supply false information into organizational systems.
Channels:
- Dutta, Bergan, and John (1994): Resellers violate resale agreements with manufacturers.
 15

- Rindfleisch and Heide (1997): Offer a summary conceptual framework of the literature on transaction cost analysis which
points out opportunistic behavior, self-seeking with guile (Williamson 1985, p. 47), on the part of an agent. The likelihood of
such behavior increases the transaction costs to buying not making the specific source of value.
- Murry and Heide (1998): Retailers fail to follow through on an agreement to display promotional materials for which they
received trade allowances.
- Wathne and Heide (2000): Identify four specific types of opportunism based on two dimensions: active vs. passive and due
to existing vs. new circumstances that lead to evasion (passive behavior/existing situation), refusal to adapt (passive
behavior/new situation), violation (active behavior/existing situation), and forced renegotiation (active behavior/new
situation).
- Seggie, Griffith, and Jap (2013): Relative to active opportunism, passive opportunism is more common and has a more
corrosive impact on partner satisfaction with performance.
- Jap, Robertson, Rindfleisch, and Hamilton (2013): Low-stakes opportunism, self-seeking when the payoffs are low, is more
likely when rapport between parties is high because people are better able to justify their actions by employing morally
malleable reasoning.
Marketing-Finance Interface:
- Markovitch, Steckel, and Yeung (2005): Pharmaceutical firms with underperforming stocks implement more high-risk
innovation strategies than firms outperforming peers.
- Tipton, Bharadwaj, and Robertson (2009): Managers engage in deceptive advertising, producing a 1 percent decrease in
shareholder value if detected by the FDA and warning letters sent to firm.
- Mizik (2010): Managers have a tendency to engage in myopic marketing management and cut marketing and R&D spending
to inflate earnings in the short-term to the detriment of long-term performance (see also Mizik and Jacobson 2007).
- Chapman and Steenburgh (2010): Managers increase marketing promotions for nonperishable products (but not for
perishables) at the end of the fiscal period in order to promote forward buying of nonperishables to increase firm revenues
attributable to the current fiscal period.
- Chakravarty and Grewal (2011): In response to past increases in stock returns and volatility, high-tech manufacturing firms
cut marketing and R&D budgets to avoid future unexpected earnings shortfalls.
- Moorman, Wies, Mizik, and Spencer (2012): Firms time the introduction of new products to show improvement over time,
which improves firm capital-market performance while hurting firm product-market performance.
- Wies and Moorman (2015): After going public, firms introduce more new products but fewer breakthrough innovations.
Marketing Research:
-Sparks and Hunt (1998): Marketing researchers are differentially sensitive to ethical considerations, including the need for
research integrity, fair treatment of clients and vendors, and confidentiality.
 16

General:
- Hunt and Vasquez-Parraga (1993): Ethical considerations influence marketing decision making first by consideration of
ethical principles (deontological considerations) and only secondarily consideration of consequences (teleological
considerations).
- Jaworski and Kohli (1993): Measures of a market-based reward system: (1) customer satisfaction assessments influence
senior managers pay; (2) salespeoples performance is measured by the strength of relationships they build with customers;
and (3) customer polls are used to evaluate salespeople.
- Hauser, Simester, and Wernerfelt (1994): Firms can use measures of customer satisfaction to ensure that employees
optimally allocate their efforts between actions that influence current period sales and actions that influence sales in future
periods.
- Murry and Heide (1998): Retailers compliance with an agreement to display promotional materials for which they received
trade allowances is more strongly influenced by incentive premiums and payment method (both economic factors) compared
to interpersonal attachments and monitoring. Interpersonal attachments do not moderate any of the economic factors,
however, performance-based incentive systems (which have a negative main effect) can weaken the positive main effect of
How should
using incentives.
marketing
- Sparks and Hunt (1998): Marketing researcher ethical sensitivity is positively influenced by organizational socialization and
agents be
negatively influenced by relativistic ethical standards and ethics education, but not influenced by professional socialization
aligned for
nor the individual trait of perspective taking (empathy).
firm
- Jap (2001): Collaborating organizations that provide complementary competencies enabling their joint efforts, share the
performance?
benefits that are created according to the type of sharing principle used and whether the sharing processes are responsive to
the goals of the collaboration.
- Kirca, Jayachandran, and Bearden (2005): Meta-analysis shows that when the reward system is market-based (focused on
customers and competitors) the firm is likely to have stronger capabilities to generate, disseminate, and respond to market
intelligence.
- Griffith and Lusch (2007): Marketers perceptions of the governance structure for more (less) easily transferable knowledge
and skills were positively (negatively) related to job outcomes (i.e., organizational commitment and trust, job satisfaction
and turnover).
Ex ante vs. ex post controls:
- Mishra, Heide, and Cort (1998): Customer firms resolve both the adverse selection and moral hazard problems that involve
questions about supplier quality and opportunism by requiring transaction-specific investments from the supplier (bonds) and
charging a price premium.
- Ghosh and John (1999): Develop a strategic extension of transaction cost analysis that incorporates resource heterogeneity,
positioning investments and governance forms for cooperative relationships.
 17

- Jap and Ganesan (2000): Suppliers transaction-specific investments in and use of relational norms toward retailer have a
positive effect on the retailers perceptions of the suppliers commitment; contracts have a negative effect.
- Ghosh and John (2005): Apply the concept of governance value analysis to assess the impact of the tightness of contractual
terms between OEMs and their suppliers based on the fit of firm resources, investments and governance forms.
Formal vs. informal controls (including culture):
- Jaworski (1988): Controls can come in the form of norms or in the form of rules. Informal controls are unwritten but
understood norms that guide individual and group behavior. Formal controls, on the other hand, are codified and
bureaucratic mechanisms that can act on inputs, processes, or outputs.
- Hunt, Wood, and Chonko (1989): Corporate ethical values are conceptualized as an important part of organizational culture
which influences marketer organizational commitment.
- Jaworski and MacInnis (1989): Self-control has no effect on gaming, smoothing, focusing, and inaccurate reporting.
However, professional control (defined as the degree to which peers within ones work unit engage in collegial interaction,
discussion, and information evaluations of a colleagues work) reduces these behaviors.
- Jaworski, Stahakopoulos, and Krishnan (1993): Employees working in organizations with a high mix of these control
mechanisms are more satisfied and experience less role conflict and role ambiguity.
- Mohr, Fisher, and Nevin (1996): High levels of manufacturer control make collaborative communication in the channel less
common.
- Ayers, Dahlstrom, and Skinner (1997): Managerial controls (centralization and role formalization) influence R&D-
Marketing integration, relational norms, and perceived effectiveness.
Output control vs. process control vs. capability control:
- Oliver and Anderson (1994): Behavior-based (process) controls are most effective (see also Cravens et al. 1993; Challagalla
and Shervani 1996).
- Bello and Guilliand (1997): Use of process controls has no effect on export channel performance while outcome control has
a positive effect (see Ramaswami 1996).
- Chu and Desai (1995): Incentives involving a bonus for customer satisfaction performance are more effective when a
manufacturer deals with a retailer with a short-term orientation, but investment assistance to improve customer satisfaction
are better when the retailer has long-term orientation.
- Challagala and Shervani (1996, p. 90): Identify capability control, defined as controls which emphasize the development of
individual skills and abilities and show how this can be administered through information, rewards, and punishments. Sales
managers who use capability control with information and rewards (punishments) produce higher (lower) salesperson
satisfaction and performance.
 18

- Heide, Wathne, and Rokkan (2007): Output (process) monitoring decreases (increases) partner opportunism in buyer-seller
relationships. Informal relationship elements can reduce the negative effects of output monitoring while facilitating the effect
of process monitoring on the level of opportunism.
- Joshi (2009): Firms should emphasize capability control and deemphasize process control to foster continuous supplier
performance improvement.
- Kashyap, Antia, and Frazier (2012): Behavioral monitoring and output monitoring alone do not improve franchisee
compliance or curb opportunistic behavior. Together, both outcomes are achieved.
The influence of reward structure:
- Hauser, Simester, and Wernerfelt (1996): Two internal customer-internal supplier incentive systems (internal customer
selects the suppliers percent of bonus based on market outcomes OR internal customer selects target market outcomes for
the supplier) reduce the need to observe either the internal customer or the internal supplier.
- Ghosh and John (2000): When risk-averse agents whose actions are not verifiable face higher levels of effort-output
uncertainty, more salary-weighted compensation should be used. On the other hand, flat wages should be used for verifiable
effort.
- Toubia (2006): Offers solution to the tendency for employees to free ride off other employees efforts when working in
groups.
- Lim, Ahearne, and Ham (2009): Allowing multiple winners in a contest improves overall sales revenue performance. Also,
unique ranked-ordered prizes do not work as well as a group of winners receiving the same award (e.g., the top four sellers
receive a vacation).
- Lo, Ghosh, and LaFontaine (2011): Firms tend to use larger incentives as the importance of agent effort increases and agents
with greater selling ability and lower risk aversion are receive larger incentives.
- Currim, Lim, and Kim (2012): Increasing top managers equity compensation increases advertising spending as a share of
sales, which, in turn, increases firm stock market returns.
- Jain (2012): Firms can mitigate employee self-control problems involving short-term (present-biased) preferences by
delaying payment to employees.
- Kishore, Rao, Narasimhan, and John (2013): Investigate the value of bonuses (paid upon reaching quota) vs. commissions
(per-unit payouts paid on sales beyond a quota). Commissions increase sales force productivity by 24% over bonuses and
this improvement is more pronounced among weak salespeople. Bonuses increase the likelihood that sales people will
engage in timing games in which they push sales into the future if they are unlikely to meet quota and pull sales from the
future if they are near quota (p. 318). Once goals were achieved, the bonus scheme did not interfere with the performance of
extramural tasks important to the firm.
 19

- Chung, Steenburgh, and Sudhir (2014): Bonuses enhance productivity and the provision of overachievement bonuses helps
sustain productivity once quotas are reached. The use of quarterly bonuses improves the performance of weaker performers
who need these intermediate rewards to pace their progress toward annual rewards.
 20

TABLE W3. THE MARKETING LITERATURE ON (HUMAN) CAPITAL

A. Marketing Leaders
Topics Findings
- Nath and Mahajan (2008): No effect for the presence of a marketing leader in the firms top management team on a firms
sales growth, ROA, ROS, and Tobins q.
- Boyd, Chandy, and Cunha (2010): Although a positive event study effect associated with the stock returns to 88 public firms
announcing the appointment of a CMO to the firms top management team, analysis indicates a great deal of heterogeneity
Do marketing with 46% of firms showing a positive effect and 54% showing a negative effect.
leaders - Homburg, Hahn, Bornemann, and Sandner (2014): There is positive impact of the presence of a marketing leader on whether
improve firm an entrepreneurial venture receives venture capital.
performance? - German, Ebbes, and Grewal (2015): The presence of a CMO in a firms top management team has a positive effect on a
firms Tobins q and Jensens a as observed in panel data models with firm and time fixed effects using rich data models,
unobserved effects models, instrumental variable models, and panel internal instruments models. Tests resolve several
critical identification issues with prior research associated with the effect of firm unobservables on CMO selection and
impact. The Tobins q for firms that employ a CMO is 15% higher than firms that do not.
- Nath and Mahajan (2008): The lack of CMO effect on firm performance is not influenced by the degree to which the firm
uses an innovation strategy, a differentiation strategy, a corporate branding strategy, a diversification strategy, or has an
outsider CEO, or industry concentration levels.
- Boyd, Chandy, and Cunha (2010): The presence of a powerful customer compromises the discretion of marketing leaders,
which reduces their impact on firm performance. This effect is weakened when marketing leaders have more role experience,
more firm experience, and firm scope and size is small but its performance is strong.
What - Nath and Mahajan (2010): CMO power on the top management team has no effect on firm sales growth or firm return on
influences sales. Powerful CMOs in firms with divisionalized power on the top management team have a positive effect on these
marketing company outcomes, while powerful CMOs in companies with unrelated diversification have a negative effect.
leader - Homburg, Hahn, Bornemann, and Sandner (2014): CMOs with a high-status MBA and more industry experience increase
effectiveness? the likelihood of VC funding. Effect is stronger when the firm competes in more unstable markets or markets with higher
competitive rivalry. Effect of the MBA and industry experience also influence the level of VC funding, but the industry
factors do not moderate the level.
- German, Ebbes, and Grewal (2015): The effect of CMO presence on firm performance is weakened in larger companies or
when the CEO has a long tenure while it is strengthened when the company experiences sales growth. No moderating effect
for firm strategy variables, such as differentiation, innovation, diversification, or corporate branding, the presence of a COO
or an outsider CEO, or market concentration levels.
 21

- Piercy (1996): Identifies twenty different marketing activities and assesses the degree to which the Chief Marketing
Executive is responsible for them. Cluster analyzing the responses from 284 companies together with measures of size, rank,
and integration of different functions, Piercy identifies four types of marketing organization and associated leaders that vary
on size, integration of functions and manpower, board representation, product-market type, and CME responsibility.
- Homburg, Workman, and Krohmer (1999): Assess marketings influence over eleven different activities (pricing, new
product development, strategic direction of the business unit, major capital expenditures, expansion into new geographic
market, choices of strategic business partners, design of customer service and support, customer satisfaction improvement
programs, distribution strategy, advertising messages, and customer satisfaction measurement) but do not subscribe these to
a specific marketing leader (see also Homburg, Vomberg, Enke, and Grimm 2015).
- Wieseke et al. (2009): Marketing leaders stimulate an organizational identification process between employees and the firm,
How do which improves business unit financial performance. This relationship happens at different levels and is moderated by both
marketing the degree to which the leader is charismatic and the relationship length between leader and follower.
leaders - Morhart, Herzog, and Tomczak (2009): Brand-specific transformational leaders (e.g., leader focusing on living the brand in
improve firm words and actions and instilling this in others) increase employee internalization of brand identity, which improves employee
performance? positive word-of-mouth, reduces turnover, and increases brand-building behaviors among employees. Moderate levels of
transactional leadership which focuses on monitoring and compliance with brand-consistent behavior seems to bolster the
effects of transformational leadership; high levels of transactional leadership hurt its effects.
- Boyd, Chandy, and Cunha (2010): Marketing leaders perform an informational role that identifies new opportunities, a
decisional role that drives investments, and a relational role that develops and manages relationships with external
stakeholders.
- Jaworski (2011): Identifies seven core tasks for CMOs: (1) establishes role of marketing in the firm; (2) owns the voice of
the market; (3) responsible for marketing strategy; (4) coordinates marketing with other areas of the firm; (5) runs the
marketing organization; (6) identifies and leads the marketing transformation effort; and (7) establishes marketing scorecard
and performance metrics.
- Homburg et al. (2014): Theorize that marketing leaders legitimize young firms.
- Nath and Mahajan (2008): CMOs are more likely to be present in firms with stronger innovation strategy and differentiation
strategy, in firms using a corporate branding strategy, as TMT marketing experience increases, as TMT general management
What
experience decreases, and when the CEO is an outsider.
influences the
- Homburg et al. (2014): Replicate some of these effects in young firms seeking venture capital. As part of their selection
appointment of
model to predict the presence of a CMO in the firm, the authors observe the following effects: firm innovation strategy (+),
marketing
firm new product introductions (+), firm differentiation strategy (n.s.), firm age (+), whether the firm is born global (n.s.),
leaders?
whether the firm is in a VC cluster (n.s.), CEO with marketing experience (+), CEO start-up experience (n.s.), CFO presence
(+), industry demand instability (+), industry legitimacy (-), and industry complexity (-).
 22

What is the - No research has been published on this topic.

marketing
leader
turnover rate
and what
factors
influence it?

B. Marketing Employees
Topics Findings
Marketer experience:
- Perkins and Rao (1990): Job experience level improves the individual use of market research information and decision quality
in less programmed domains.
- Moorman, Deshpand, and Zaltman (1993): Market researcher job and firm experience has no effect on trust from market
research users.
- Andrews and Smith (1996): Diversity of experience has no effect on marketing program creativity.
- Clark and Montgomery (1999): Job tenure reduces the number of competitors identified by managers.
- Mintz and Currim (2013): Job experience is negatively related to use of financial metrics but unrelated to the use of marketing
What is the metrics.
contribution of Marketer knowledge:
marketing - Blattberg and Hoch (1990): A combination of manager use of a model and manager ability has superior performance effects
employee relative to each input alone.
knowledge and - Moorman, Deshpand, and Zaltman (1993): More expert market researchers inspire greater trust from market research users.
experience? - Andrews and Smith (1996): Operating environment knowledge has no effect, macroenvironment knowledge has a positive
effect, and diversity of education has no effect on marketing program creativity.
- Homburg, Wieseke, and Bornemann (2009): Examine front-line employees customer need knowledge, defined as the extent
to which an employee can correctly identify a given customers hierarchy of needs. They find that this knowledge fully
mediates the effect of employee characteristics (such as customer orientation or empathy) on the employees customers
satisfaction and willingness to pay.
- Kidwell, Hardesty, Murtha, and Sheng (2011): The emotional intelligence of salespeople is positively related to their sales
performance, even when controlling for experience.
- Mintz and Currim (2013): Manager quantitative background is positively related to individual financial metric use.
 23

- Mullins, Ahearne, Lam, Hall, and Boichuk (2014): The accuracy of a salespersons relationship quality judgments improves
individual performance.
- Hall, Ahearne, and Sujan (2015): Accurate intuitive salesperson judgments improve selling performance by improving the
choice of initial sales strategy and by reducing selling time. Performance is negatively affected when inaccurate deliberate
judgments follow from accurate intuitive judgments.
Innovation training:
- Goldenberg, Mazursky, and Soloman (1999): Training subjects in creativity templates increases the creativity of new
products developed compared to a control group that receives no training or a group that receives training in other creativity
techniques (e.g., lateral thinking, HIT).
- Scott, Leritz, and Mumford (2004): Meta-analysis indicates that creativity training works.
- Burroughs, Dahl, Moreau, Chattopadhyay, and Gorn (2011): Training programs designed to improve creativity during new
product development improve product creativity most when both rewards and training programs are used.
Sales training:
- Gopalakrinshna and Lilien (1995): Training improves firm performance across three different outcomes associated with trade
show performance.
- Anderson and Robertson (1995): Sales training reduces risk of turnover.
- Godes (2003): Training should be a function of the ROI expected from such investments and this is influenced by nature of
What is the
product and high/low ability sales types.
impact of
- Kalra and Soberman (2008): The use of training films that emphasize beat the competition do reduce competitor
marketing
profitability. However, this benefit is achieved by managers willingness to sacrifice their own companies profits in order to
training?
reduce competitor profits.
- Homburg, Wieseke, and Bornemann (2009): Customer-oriented training (perspective taking training) has a positive (no) main
effect on customer need knowledge. Customer-oriented training strengthens the positive effect of employee customer
orientation on customer need knowledge.
- Kumar, Sunder, and Leone (2014): Positive but non-linear relationship between task-related training (focused on the product
and customer) and growth-related training (focused on leader, team selling, and negotiation skills) and the value of a
salesperson to the firm (measured by customer lifetime value). The non-linearity suggests that the value of training diminishes
after a certain point, but the exact point varies by salesperson types that reflect different sensitivities to training and
incentives.
Marketing decision making training:
- Boulding, Morgan, and Staelin (1997): Managers can be trained to use stopping rules to attenuate the tendency to make
ongoing financial commitments to failing new products.
 24

- Armstrong and Collopy (1996): A focus on market share and beating the competition worsens with management education
(viewed as a type of training).
- Bolton (2003): Priors generated through analogies in new product forecasting are persistent when they should be discarded
and training to resolve does not work.
- Hutchinson, Alba, and Eisenstein (2010): Advertising allocation decisions are hampered by heuristics that drive managers to
allocate more dollars to an advertising medium that is uncorrelated with sales. Prior experience and training do not resolve
these problems.
Ethics training:
- Sparks and Hunt (1998): The level of formal training in ethics during a college education and during a career in marketing
research is negatively related to marketing research professionals likelihood of recognizing an ethical issue.
Leadership training:
- Morhart, Herzog, and Tomczak (2009): Managers can be trained to effectively enact the array of behaviors associated with
brand-specific transformational leaders.
-Parasuraman, Zeithaml, and Berry (1985): Pioneering work on SERVQUAL theorizes that the customers perception of
experienced service quality can break down due to a number of internal and external organizational gaps (see also Zeithaml,
Berry, and Parasuraman 1988). One of these gaps is due to a breakdown between the design and delivery of service quality
which is influenced by the selection, training, compensation, and evaluation of employees.
-Jaworski and Kohli (1991): A fourfold typology of coworker feedback focused on locus (output vs. behavior) and valence
How does the (positive vs. negative). Results indicate that behavioral feedback is more effective than output feedback and that positive
management of feedback is more effective than negative feedback; negative behavioral feedback has a dysfunctional effect on performance.
front-line -Singh and Rhoads (1991): Front-line employees often experience special types of stress and ambiguity given they are
employees responsible to the organization and to the customer.
impact -Bitner (1992): Physical surroundings or servicescapes impact the quality of employee-customer interactions.
customers and -Bitner, Booms, and Mohr (1994): Analyze critical service encounters from both employee and customer perspectives and find
firm general agreement between the two parties. However, from the employees point of view, they uncover a novel source of
performance? dissatisfactionthe customers own misbehavior.
-Kohli and Jaworski (1994): A fourfold typology of coworker feedback focused on locus (output vs. behavior) and valence
(positive vs. negative). Results indicate that positive output feedback has the strongest positive effect on performance while
positive behavioral feedback has the strongest positive effect on satisfaction.
-Siguaw, Brown, and Widing (1994): The larger the difference between a salespersons individual customer orientation and
the firms market orientation, the higher the salespersons role conflict. The difference had no effect on role ambiguity, job
satisfaction, or organizational commitment.
 25

-Hartline and Ferrell (1996): Role ambiguity has significant negative effect on employee self-efficacy, job satisfaction, and
adaptability.
-Singh (2000): Customer service and bill collection representatives experience burnout in interacting with customers when
they face role ambiguity and role conflict in these interactions. Interestingly, burnout reduces quality but does not affect
productivity. Task control (the latitude to make decisions) emerges as a more important coping resource for FLEs than the
socio-emotional support of a boss.
-Donovan, Brown, and Mowen (2004): Employee customer orientation has a positive effect on job satisfaction, job
commitments, and organizational citizenship behaviors.
-Ye, Marinova, and Singh (2007): A strategic change to emphasize both productivity and quality can be facilitated when FLEs
participate in the process, which allows them to detach effectively and separate the negative and positive effects of change.
-Marinova, Ye, and Singh (2008): The tension between productivity and quality among FLEs is best resolved by increasing the
autonomy of FLEs and strengthening the cohesiveness among employees in the business unit.
-Chan and Wan (2012): Work stress causes depletion and this influences employee performance on job activities that require
self-regulation, such as handling complaints.
-Jasmand, Blazevic, and de Ruyter (2012): Identifies the conditions in which a customer service representatives in an inbound
call center can be ambidextrous and provide appropriate after sales service while up-selling and cross-selling.
-Sarin, Challagalla, and Kohli (2012): Supervisors can facilitate implementation of changes to marketing strategy using a mix
of outcome-oriented and process-oriented supervisory actions. Both outcome and process risk containment strategies are more
effective for salespeople with a higher performance orientation.
-Schepers, Falk, de Ruyter, de Jong, and Hammerschmidt (2012): Customer stewardship control, defined as the employees
felt ownership of and moral responsibility for customers overall welfare, shapes important in- and extra-role behaviors
performed by employees.
-Zablah, Franke, Brown, and Bartholomew (2012): Meta-analysis indicates that customer orientation (the belief that the
organization should place customers interests first in all decisions) reduced employee job stress and increase job
engagement, which in turn, increases employee performance and reduces the likelihood of turnover.
What is the - Heskett, Jones, Loveman, Sasser, and Schlesinger (1994): In the logic of the service profit chain, employee actions and
contribution of satisfaction are viewed as contributing to the actions and satisfaction of customers, which, in turn, produce firm financial
employee performance.
satisfaction to - Kamakura, Mittal, DeRosa, and Mazzon (2002): Resource investments in employees have a positive effect on customer
firm perceptions of employees and these perceptions increase customer purchase intentions, purchase, and retention as well as
performance? profitability.
 26

- Maxham, Netemeyer, and Lichtenstein (2008): Employee in-role and extra-role performance toward the customer are
positively related to customer evaluations, which, in turn, mediate the effect on average customer transaction value and
comparable store sales growth.
-Dotson and Allenby (2010): Customer and employee satisfaction have a direct effect on bank revenues and these sources of
satisfaction also moderate the relationship between a banks investments in technology and revenues.
 27

TABLE W4. THE MARKETING LITERATURE ON ORGANIZATIONAL CULTURE

Topics Findings
Forms of culture:
-Deshpand and Webster (1989): Organizational culture is the shared values and beliefs that help individuals understand
organizational functioning and that provide norms for behavior in the organization.
-Narver and Slater (1990): Define market orientation as the organization culture (i.e., culture and climate) that most
effectively and efficiently creates the necessary behaviors for the creation of superior value for buyers and, thus, continuous
superior performance (p. 21). In their view, a market-oriented culture requires three reinforcing behaviorsa customer
orientation (i.e., an understanding of one's target buyers to be able to create superior value for them continuously), a
competitor orientation (i.e., a seller understands the short-term strengths and weaknesses and long-term capabilities and
strategies of both the key current and potential competitors), and a focus on interfunctional coordination (i.e., behaviors
reflecting coordinated utilization of company resources in creating superior value for target customers).
-Homburg and Pflesser (2000): Market-oriented organizational-culture includes: (1) organization-wide shared basic values
supporting market orientation; (2) organization-wide norms for market orientation; (3) perceptible artifacts of market
How has
orientation; and (4) market-oriented behaviors.
organizational
-Gebhardt, Carpenter, and Sherry (2006): Focus on values, norms, behaviors, and artifacts that carry cultural meaning.
culture been
Content of culture:
studied in
-Narver and Slater (1990): A market orientation is the business culture that most effectively and efficiently creates superior
marketing?
value for customer. It is comprised of three behavioral components (customer orientation, competitor orientation,
interfunctional orientation) and two decision criteria (long-term focus and a profit objective).
-Deshpand, Farley, and Webster (1993): The intersection of internal vs. external orientation and organic/informal vs.
mechanistic/formal processes produces four cultures emphasizing different values: market (high external, high formal),
adhocracy (high external, high informal), bureaucracy (high internal, high formal), and clan (high internal, high informal)
(see also Lukas, Whitwell, and Heide 2013; Moorman 1995; Srinivasan, Lilien, and Rangaswamy 2002; White, Varadarajan,
and Dacin 2003).
-Hurley and Hult (1998): Culture contains a value emphasizing the openness of the organization to new ideas and is measured
by the degree to which the company: (1) provides opportunities for individual development other than formal training; (2)
encourages managers to attend formal development activities, such as training, professional seminars, and symposia; (3) has
people in the firm who provide career guidance and counseling; and (4) promotes career management as a shared
responsibility of both employee and manager.
 28

-Wuyts and Geyskens (2005): Create firm-level equivalents of Hofstedes nation-level measures: uncertainty avoidance (firm
feels threatened by and tries to avoid ambiguous situations in the supply chain), collectivism (a focus on group norms over
personal goals), and power distance (more powerful firms should have more say in relationships).
-Gebhardt, Carpenter, and Sherry (2006): Market-oriented culture is reflected in the following values (and associated norms):
(1) market as the raison dtre (every decision and action must consider how it affects the market); (2) collaboration (teams
are jointly responsible for outcomes); (3) respect/empathy/perspective taking (consider the perspectives, needs, training, and
experience of others when reacting to or interpreting their actions); (4) keeping promises (each employee is responsible for
following through on commitments to others); (5) openness (proactively and honestly share information, assumptions, and
motives with others); and (6) trust (trust that your fellow employees are telling the truth and will follow through on
commitments).
-Tellis, Prabhu, and Chandy (2009): Three attitudes and three behaviors associated with a firms culture are critical to its
ability to develop and introduce radical innovation. The attitudes are a willingness to cannibalize current offerings with
innovation (see Chandy and Tellis 1998), an orientation on the future (see Yadav, Prabhu, and Chandy 2007), and a
tolerance for risk. The behaviors are empowerment of product champions, incentives for innovation, and creation and
maintenance of internal markets that foster autonomy and competition for innovation.
-By surveying key informants: Deshpand, Farley, and Webster 1993; Kohli, Jaworski, and Kumar 1993; Day and Nedungadi
How is 1994; Moorman 1995; Chandy and Tellis 1998; Hartline, Maxham, and McKee 2000; Homburg and Pflesser 2000;
organizational Srinivasan, Lilien, and Rangaswamy 2002; White, Varadarajan, and Dacin 2003; Wuyts and Geyskens 2005; Tellis, Prabhu,
culture and Chandy 2009; Lam, Kraus, and Ahearne 2010; Lukas, Whitwell, and Heide 2013.
measured in -By a multi-method approach: Gebhardt, Carpenter, and Sherry (2006) use a longitudinal multi-method approach including
marketing? interview data, archival data, and observational data to develop a model of cultural transformation toward a market
orientation.
Firm financial and market performance outcomes
-Narver and Slater (1990): Market-oriented culture has a positive effect on firm profitability.
What is the -Deshpand, Farley, and Webster (1993): Firm market culture has a positive effect on firm performance (relative to
contribution competition on profits, size, market share, growth rate).
of culture to -Bharadwaj, Varadarajan, and Fahy (1993): Propose that the greater the people intensity of service industry, the greater the
firm importance of culture as a source of competitive advantage.
performance? -Day and Nedungadi (1994): The relationship between a market-driven mental model and firm performance is stronger than
competitor-centered, customer-centered, or self-centered mental models.
-Homburg and Pflesser (2000): Market-oriented behaviors have a positive effect on a firms performance (measured by both
market performance and financial performance) and that this effect is stronger in more dynamic markets.
 29

-Rubera and Kirca (2012): Meta-analysis indicates a positive relationship between an innovative culture and a firms financial
position or value.
Firm innovation outcomes
-Hurley and Hult (1998): Describe a positive relationship between a cultural focus on learning and development and firm
capacity to innovate.
-Han, Kim, and Srivastava (1998): Innovation mediates the relationship between market orientation and firm performance.
-Menon, Bharadwaj, Adidam, and Edison (1999): An innovative culture has a positive effect on the key components of a
firms marketing strategy making process, including comprehensiveness, marketing assets and capabilities, communication
quality, consensus commitment, and resource commitment.
-Kirca, Jayachandran, and Bearden (2005): A meta-analysis finds that market orientation facilitates innovativeness.
-Tellis, Prabhu, and Chandy (2009): There is a positive relationship between five elements of corporate culture, including
three attitudes (willingness to cannibalize, tolerance for risk, and orientation on the future) and two behaviors (empowerment
of product champions and incentives for innovation).
Firm information outcomes
-Moorman (1995): Clan cultures foster greater conceptual and instrumental use of market information.
-Srinivasan, Lilien, and Rangaswamy (2002): A firms future focus and its adhocracy culture influences a firms
technological opportunism (ability to sense-and-respond to new technologies).
-White, Varadarajan, and Dacin (2003): Both informal culturesadhocracies and clanincrease the perceived control of
external events, which, in turn, increases (decreases) the likelihood that the event will be appraised as an opportunity (threat).
Firm channel/relationship outcomes
-Moorman, Deshpand, and Zaltman (1993): Hierarchical cultures reduce trust between producers and users of market
research.
-Wuyts and Geyskens (2005): Firm-level collectivism is positively associated with both detailed contract drafting and close
partner selection behaviors, while uncertainty avoidance and power distance are positively related to detailed contract
drafting.
-Lukas, Whitwell, and Heide (2013): External organizational cultures (adhocracies and markets) are associated with a
tendency to overshoot customer needs among suppliers in the IT industry.
How should -Hartline, Maxham, and McKee (2000): A firms customer orientation is more likely to end up in employees shared values
firms build when one of several corridors of influence are used, including socialization through an employees work group and less
and sustain a formalized and more behavior-based evaluation.
market- -Gebhardt, Carpenter, and Sherry (2006): A four-stage path-dependent change process occurs in the transformation toward a
oriented market-oriented culture: (1) a small group of empowered managers identify the need to change (initiation), (2) these
culture? managers create a coalition that demarcates the nature of the cultural change, the removal of dissenters, and the hiring of
 30

believers (reconstitution), (3) changes are institutionalized, including formalization of cultural elements, alignment of
rewards, the education of members, and a power shift back to the larger organization (institutionalization), and (4) the
ongoing preservation of the new culture through screening new members, enactment of rituals and the emergence of flame
keepers, and the resistance to management fads and fashions (maintenance).
-Lam, Kraus, and Ahearne (2010): Study middle managers and work-group expert peers who serve as top mangers envoys
and role models of market-oriented behavior to front-line employees.

TABLE W5. HOW MARKETING ORGANIZATION INFLUENCES FIRM PERFORMANCE THROUGH
MARKORG
Marketing
Capabilities
7As
A firms market orientation
processes (Kohli and
Jaworski 1990) and market
sensing capabilities (Day
Anticipation 1994) focus firm attention
Activities: on the marketplace.
Actions for early Market sensing increases
and accurate early entry into e-business
sensing of (Srinivasan, Lilien, and
external threats Rangaswamy 2002).
Designing Marketing Strategy
and opportunities
Strategic flexibility
capabilities enable a firm to
respond to changes in the
competitive environment
(Grewal and Tansuhaj
Adaptation
2001).
Activities:
There are three critical
Actions to change
adaptive capabilities:
firm strategy and
vigilant market learning,
organization for
adaptive market
external
experimentation, and open
alignment
marketing (Day 2011) while
Morgan (2012) argues
dynamic capabilities in
market learning, resource
reconfiguration, and
THE 7As IN THE LITERATURE
Configuration:
Structure, Metrics Use,
Incentives/Controls
Structure: Firms with more powerful
marketing departments have a stronger
market orientation and a longer-term
time orientation (Feng, Morgan, and
Rego 2015).
Use of Metrics: Use of customer
satisfaction metrics has its strongest
effects on how managers think and
make decisions (Morgan, Anderson,
and Mittal 2005).
Incentives/Controls: A market-based
reward system increases acquisition,
dissemination, and use of marketplace
information (Kirca, Jayachandran, and
Bearden 2005).
Structure: A cross-functional key
account management structure is the
most adaptive to market changes
(Homburg et al. 2002). Firms with
powerful marketing departments have
stronger market orientation, which
includes responsiveness to changes in
the marketplace (Feng, Morgan, and
Rego 2015).
31
(Human) Capital:
Marketing Leaders and Culture
Marketing Employees
Leaders: Marketing leaders A strong cultural emphasis on the
perform an informational role that customer increases the regular
identifies new opportunities for the accessing of customer information
firm to pursue (Boyd, Chandy, and (Deshpand, Farley, and
Cunha 2010). Webster1993).
Employees: (1) Employee customer A cultural focus on the future
need knowledge improves customer increases radical innovation (Yadav,
outcomes (Homburg, Wieseke, and Prabhu, and Chandy 2007).
Bornemann 2009). (2) Salesperson
relationship quality knowledge
increases account profitability
(Mullins, Ahearne, Lam, Hall, and
Boichuk 2014).
Leaders: (1) A guiding coalition of A cultural focus on the willingness to
leaders identifies the need for change cannibalize improves firm
and guides change activities to create introduction of radical innovation
a market orientation (Gebhardt et al. (Chandy and Tellis 1998).
2006). (2) Supervisors facilitate Cultural attitudes (e.g., willingness to
change in a sales channel by cannibalize, focus on the future) and
emphasizing rewards associated with behaviors (e.g., empowerment of
the change and by tolerating mistakes product champions) increase radical
(Sarin, Challagalla, and Kohli 2012). innovation (Tellis, Prabhu, and
Employees: (1) Removing dissenters Chandy 2009).
and hiring believers facilitates change Respect, empathy, and perspective-
to market orientation (Gebhardt, taking are critical values in the
Carpenter, and Sherry 2006). (2) transformation of firms toward a
Cohesion among and feedback to market-oriented culture (Gebhardt,
front-line workers improved Carpenter, and Sherry 2006).
adaptation to new quality program

capability enhancement
enable change.
Knowledge integration Structure: (1) Key account
capabilities that combine management design can create
and synthesize information alignment by influencing what is done
about market and technology (activities), who does it (actors), with
conditions increase what is it done (resources), and
innovation performance formalization of actions (Homburg et al.
(Luca and Atuahene-Gima 2002).(2) Alignment can be facilitated
2007). when the marketing function connects
Alignment the customer to different functions
Implementing Marketing Strategy
Activities: (Moorman and Rust 1999). (3)
Actions to create Cooperation between marketing-R&D,
internal alignment sales-R&D, and marketing-sales all
of people, have a positive effect on new product
processes, and performance (Ernst et al. 2010).
structures Use of Metrics: Comprehensiveness of
a firms marketing performance
measurement system increases
alignment of marketing activities to
objectives (Homburg et al. 2012).
Incentives/Controls: A key function of
incentives and controls is to align
agents actions (see Table W2C for
details).
Activation Incentives/Controls: (1) Behavior-
Activities: based evaluations motivate customer
Actions to focus (Hartline et al. 2000). (2) The use
motivate and of a market-based reward system
inspire individual increases acquisition, dissemination,
and/or and use of market information (Kirca,
organizational Jayachandran, and Bearden 2005). (3)
behaviors Professional controls are more
32
(Marinova, Ye, and Singh 2008). (3)
Salespeople with a learning
orientation were more likely to
perform effectively over the long-
term after a major strategic change to
the firm (Ahearne, Lam, Mathieu,
and Bolander 2010). (4) Employees
with both a locomotion orientation
and an assessment orientation offer
strong service on current orders and
are more likely to cross-sell and up-
sell new offerings (Jasmand et al.
2012).
Leaders: Marketing leaders The coherence of market-oriented
stimulate an organizational values, norms, behaviors, and
identification process that produces a artifacts influences alignment by
sense of oneness between influencing hiring, training, and
employee and firm and which rewards (Gebhardt, Carpenter, and
improves firm performance (Wieseke Sherry 2006).
et al. 2009).
Employees: Employee and brand
personality alignment improves
customer brand evaluations (Siranni
et al. 2013).
Leaders: (1) Brand-specific Cultural norms focused on the
transformational leaders increase market guide the enactment of
employee internalization of brand employee market-oriented behaviors
identity, which improves word of (Homburg and Pflesser 2000).
mouth, reduces turnover, and Defining critical behaviors to align
increases the performance of in-role with the market as the firms raison
and extra-role brand-building dtre facilitates the development of
behaviors (Morhart, Herzog, and
 33

Firms have differential skills
in evaluating marketing
performance and this skill
improves performance
Assessing Marketing Strategy
motivating in reducing marketer
misbehaviors than self-control
mechanism (Jaworski and MacInnis
1989).
Employees: (1) Customer-oriented
Structure: The marketing function
creates accountability through the
creation of market orientation activities
(Verhoef and Leeflang 2009). Firms
Tomczak 2009). (2) Marketing a market-oriented culture (Gebhardt,
leaders stimulate an organizational Carpenter, and Sherry 2006).
identification process between Movement toward a market-
employee and firm, which improves oriented culture is intrinsically
firm performance (Wieseke et al. motivating as employees work
2009). (3) Middle managers socialize together to serve the market
front-line employees in core (Gebhardt, Carpenter, and Sherry
customer values (Lam, Krauss, and 2006).
Ahearne 2010).
employees demonstrate a stronger
firm commitment, higher job
satisfaction, and organizational
citizenship behaviors (Donovan,
Brown, and Mowen 2004) and higher
engagement, better performance, and
longer job tenures (Zablah et al.
2012). (2) Customer stewardship
control (i.e., an employees felt
ownership for customer welfare)
shapes in- and extra-role behaviors
(Schepers et al. 2012).

(Moorman 1995). with strong marketing departments have

significantly greater respect in the top
management team and greater influence
over strategic decision making within
Accountability
the firm (Feng, Morgan, and Rego
Activities:
2015).
Actions to assign
Use of Metrics: Use of performance
responsibility for
measurement systems that link
firm performance
marketing actions to outcomes improve
firm performance (OSullivan and Abela
2007).
Incentives/Controls: Bonuses
determined by customer satisfaction
performance increase long-term focus
(Hauser, Simester, and Wernerfelt
1994).
 34

Strong relational capabilities Leaders: CMOs with more The shift toward a market-oriented
attract partners (Johnson et marketing experience improve firm culture involves attracting employees
al. 2004). VC funding (Homburg et al. 2014). that buy a customer mission
Attraction Capability outputs attract: (Gebhardt, Carpenter, and Sherry
Activities: Strong brands attract 2006).
Actions to attract employees at lower pay
financial, (Tavassoli, Sorescu, and
Resourcing Marketing Strategy

relational, and Chandy 2014) and high

human capital customer satisfaction
increases employee and
manager quality (Luo and
Homburg 2007).
Market orientation Structure: (1) Flow of marketing Leaders: (1) Firms with CMOs have
capabilities improve knowledge is influenced by a higher Tobins q (Germann, Ebbes,
customer outcomes (loyalty organizational formalization and and Grewal 2015). (2) Marketing
and satisfaction) and centralization (Kirca, Jayachandran, and leaders perform a relational role by
Asset
employee outcomes (more Bearden 2005). (2) A powerful developing and managing a firms
Management
organizational commitment, marketing function has positive effect relationships with external
Activities:
team spirit, customer on the short-run leveraging and long-run stakeholders (Boyd, Chandy, and
Actions to
orientation, job satisfaction, development of market-based assets Cunha 2010).
develop and
and less role conflict) (Feng, Morgan, and Rego 2015). Employees: Service-profit-chain
leverage
Marketing learning research finds that satisfied
marketing assets
capabilities help firms employees create satisfied customers
leverage marketing alliances which increase firm profits
(Xiong and Bharadwaj (Kamakura, Mittal, de Rosa, and
2011). Mazzon 2002).
 35

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