Why Global Marketing Structure Must Follow Strategy

Sony Ericsson's Lennard Hoornik Redesigned His Organization to Fit Its Purpose, and So Should You

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Marc de Swaan Arons
Marc de Swaan Arons
Frank van den Driest
Frank van den Driest
The proliferation of global brands raises several challenges for today's global chief marketers that marketers of yesteryear never encountered. One such challenge: that of reducing headcount then reviving sales while building a brand sold in a competitive, global market. The following edited excerpt from the new book, "The Global Brand CEO: Building the Ultimate Marketing Machine," by Marc de Swaan Arons and Frank van den Driest, details how Sony Ericsson's Lennard Hoornik met that very challenge.

When he began his new job just two years ago at Sony Ericsson, Lennard Hoornik's brief was clear: Cut as many people as all the other disciplines are doing. Costs needed to drop quickly. Oh ... and fix the brand!

Relocating from his previous regional Asian job, the most important decision Lennard made before landing in London to claim his seat at the table: calling the CEO to ask if he could take another month before deciding and announcing where precisely he'd reduce marketing headcount. First, he would develop a new vision and role for the brand and global marketing.

Structure follows strategy. This adage sounds so logical, yet most organizations forget or ignore it. The result? Marketers and their peers lack a once-solid integrated perspective. Increasingly, they share power with functional leaders. More and more, they've split up business units to increase their focus on narrow groups of products; created "bridge" functions to coordinate existing functions; or added specialist capabilities to address new consumer media channels.

Via our observations and research, we believe that more than a few marketers spend as much as 80% of their day in meetings, coordinating their plans and programs with those of other internal groups. In our book we talk a lot about the crucial importance of building effective connections across the company, but clearly this isn't the best use of marketers' time and energy. The result: significant reductions in marketers' ability to connect to outside reality with consumer needs -- or to think objectively about how best to create value.

This won't change anytime soon. In the future, market globalization will drive increased organizational globalization. Our prediction? The sheer number of mergers that drive scale and global reach, plus an increase in strategic partnerships that deliver more holistic solutions and consumer experiences, plus the amount of internal regional and global integrations ... will only snowball in the future.

We've studied all areas of global marketing. Our findings consistently show that organization, roles and responsibility, and global behaviors are without doubt one of the knottiest global marketing leadership challenges out there. Yet few global marketers have the stomach or energy to tackle the subject.

One consistent insight? Almost all global marketing leaders (and quite a few of their bosses and board colleagues) admit that they initially underestimated the importance of addressing their organization structure and processes.

To which we reply: Ignore this subject at your own peril!

Back to Lennard Hoornik, the head of global marketing for Sony Ericsson. In 2008 competition had become intense, Apple had just launched its new iPhone, and financial pressure was mounting. The company was restructuring to regain profitability, increase efficiency and address the industry globalization trend.

Hoornik knew the challenge was tough. Sensing that the marketing had become too removed from the business, he quickly set about reconnecting and making clear to the rest of the organization that marketing understood its role, building the brand through marketing programs and communication to serve the business.

Ensuring that he had the right people on the bus first, and moving fast, Hoornik quickly assembled a small team of the best HQ and regional marketers to develop the new brand vision and global marketing strategy.

Starting with a global marketing effectiveness survey PulseCheck, a proprietary benchmarking and survey tool, Hoornik quickly built an understanding of all the key opportunities, challenges and needs of the most important markets, as well as the readiness for growth of the new more global marketing organization. By quickly reaching out to all major stakeholders across the business, Hoornik and his team ensured that everyone knew marketing was connected again.

The results were positive. Key stakeholders were impressed to see marketing come "back" to the business, and marketers were more highly motivated and inspired about working on the Sony Ericsson brand. They were positive and encouraging about a more global approach to building the brand and leveraging a more global strategy to make relevant for local markets.

The idea of arming everyone with a global marketing model with global marketing communications and tools to support local implementation received tremendous support. But people were also looking for changes in the organization to facilitate it all: eliminating roadblocks, confusion and duplication, and they wanted new ways of working to enable the brand vision to be translated into reality.

Once it was clear what business requirements the new global marketing strategy needed to address, Hoornik challenged a dedicated team of internal and external experts to redesign the marketing organization, cutting overall headcount numbers and making it "fit for purpose" for the new strategy.

ABOUT THE AUTHOR
Marc de Swaan Arons is co-founder and chairman of global marketing consultancy EffectiveBrands. He founded the firm in 2001 following a career at Unilever.
Frank van den Driest is co-founder of EffectiveBrands. Previously he worked in executive management roles at BBDO, GfK and the PositioningGroup.
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