Strategy-Structure Fit

Description

Vorhies and Morgan showed that fit between marketing organization (structure, task routines, and coordination) and business strategy predicts marketing effectiveness, and Olson, Slater, and Hult showed that performance depends on fit among business strategy, marketing organization structure, and strategic behaviors.

Managerial Implications

Performance depends on the fit among business strategy, marketing organization structure, and strategic behavior. Prospectors perform best with decentralized, customer-focused structures; low-cost defenders with centralized, formalized ones. Reorganizations that import a structure without checking the strategy it serves rarely deliver. Before redesigning the marketing organization, state the strategy it must execute, then choose formalization, centralization, and specialization to match.

Anchor Works

• Olson, Eric M., Stanley F. Slater, and G. Tomas M. Hult (2005), “The Performance Implications of Fit Among Business Strategy, Marketing Organization Structure, and Strategic Behavior”, Journal of Marketing, 69 (3), 49–65.

• Vorhies, Douglas W. and Neil A. Morgan (2003), “A Configuration Theory Assessment of Marketing Organization Fit with Business Strategy and Its Relationship with Marketing Performance”, Journal of Marketing, 67 (1), 100–15.