MARKETING IS TOP LEVEL MANAGEMENT AND SALES IS SECOND LEVEL MANAGEMENT

By: V S RANGARAJAN Posted on: 2008-03-12 ** Print Article ** ** Copy Article ** - Category Feed

Article Summary: Marketing function precedes the production function whereas Selling function starts after the production function

I)INTRODUCTION

Marketing function precedes the production function whereas Selling function starts after the production function

Marketing unction starts with identification of the buyer needs, then arranging for production of the product and finally selling it to customers. Thus customers are pulled to the Trader. Hence called ‘Pull strategy’

Selling function involves selling the already produced product to the customers by aggressive selling using sales promotional methods like sales offers, discount pricing, etc and hence called ‘Push strategy’

Thus Marketing avoids Post mortem job of producing the product and searching for customers

Selling is the sub function of Marketing

Marketing involves strategic planning and arriving at the policy guidelines whereas Sales involves execution and controlling of the Marketing plan prepared

The importance of Marketing function increases with the level of operation of the organizations and the environment in which the organization exists

The expertise level required in performing the Marketing function is more compared to the expertise level required to perform the Sales function

II) CLASSIFICATION OF ORGANISATIONS

Organizations could be classified in the following two ways

Classification of Organization based on purpose

Some organizations ( Not Profit organizations ) exist for achieving a well defined purpose with service motive ( not with the purpose of making profit, example, voluntary organizations like Blue cross, CRY, etc ). The funds received from the Philanthropist will be utilized for the purpose for which it is received by the organization

Some organizations ( Profit for Survival only, not for wealth creation ) exist for achieving a well defined purpose by generating funds through the operations of business to the extent of meeting the expenses incurred

Most of the organizations ( Profit motive only )exists for achieving the purpose of making profit and build up wealth

The organization may exist for any of the above mentioned purposes. All need to be managed efficiently for achieving the purpose for which it was established

Classification of Organizations based on activities performed

The activities of business could broadly be classified into 1) Manufacturing and 2) Trading

Manufacturing

In the Manufacturing activity the Natural Resource is converted into finished products following the prescribed process of manufacture using the relevant technology

Trading

Trading activity is the exchange process transaction which takes place between the Buyer and the Seller

Manufacturing / Trading / Manufacturing and Trading / Organizations

Based on the activities performed the Business organizations could be classified into Manufacturing / Trading / Manufacturing and Trading Organizations. All need to be managed efficiently for achieving the purpose ( profit and wealth creation ) for which it was established

Classification of Organisations based on the level of investment

The investment made on the business could broadly be classified into 1) Small scale industry 2) medium scale industry 3) large scale industry and 4) Mega industry

The investment on Plant and Machinery is the deciding factor to classify the industry on the above factor

In all the sectors Trading activity exists

III) MANAGEMENT AND ADMINISTRATION

Organizations through Management and Administration Plan, implement and control the functions and achieve results. The terms when viewed from the Top level management these terms Management and Administration represents different meanings

The term Management consists of the functional elements ( viz ) Planning, Coordinating, Executing and Controlling

The term Administration consists of the functional elements ( viz ) Executing and Controlling

Of course the term Administration also involves functions of Planning, Organizing and Controlling while performing the activity at the second level or at the lower level management in the organization for executing the plan set by Top level Management

IV) MANAGEMENT AND ADMINISTRATION WITH REFERENCE TO TRADING ACTIVITY

The Trading activity could be sub divided into two activities ( viz ) Marketing and Selling

From the perception of the Top management, the Marketing function is performed by the Top management of the company and hence is referred to the Management function ( involving forward thinking ) and the Sales function is performed by the second level or lower level management in the organization ( involving execution ) and is referred to Administration

V) MARKETING FUNCTION REFERS TO STRATEGIC PLANNING IN TRADING ACTIVITY

Marketing function involves Strategic Planning activity for the organization as a whole, Coordinating activity between the functional departments of the organization, Policy guidelines formulation, etc on which the execution and controlling department ( ie ) Sales department works

Marketing is the process of identifying the target market in the selected market and satisfying the identified customers by providing the product to them using Marketing mix ( viz ) Product, Place, Price and Promotion in a given environment

The Marketing Manager achieves his objectives by implementing the appropriate Marketing strategy using the tools of Marketing Mix ( ie ) 4Ps

He arrives at the strategy after conducting Marketing research on the Consumer preference, Competitors and the Company strengths and weaknesses

Marketing Manager along with the top level managers of the company take major decisions like deciding on Market expansion programs, Product expansion programs, Integration programs, Direct / In direct Marketing system, etc

Based on the findings of the research he takes the following decisions to arrive at an appropriate strategy using the Marketing Mix

He takes Product decisions like What product to produce? How much to produce? How many varieties to be produced ? When to produce ?etc

He takes Place decisions like Where to sell ? How to reach that place ? Whether to use Marketing intermediaries to sell in the selected place ? Logistics decisions , etc

He takes Promotional method decisions like Advertising, Personal selling, Publicity, Public relations, Sales promotion, etc

He takes Pricing method decisions Cost plus pricing, Demand pricing, Market pricing, Promotional pricing, etc

He prepares action plans combining two or more methods of the above mentioned to achieve the set objectives and these plans form the basic guideline for the personnel engaged in Sales

Hence major plans charted out at the Marketing function ( keeping in view the future longer duration ) by the Top management which is used for governing the entire operations of the Trading activity and followed by the Sales department to carry out the day to day operations of selling

The Marketing function also involves coordinating with Merchandising department, Marketing Research department, Production and Planning department, Human Resource Planning department, Finance department and with other departments of the organization ( both within and outside the organization ) for formulating the strategic plans and policies. Hence needs expertise of the Top management personnel

VI) SELLING FUNCTION REFERS TO EXECUTION AND CONTROL IN TRADING ACTIVITY

From the Organization’s overall perspective the Sales function is performing only the execution and control of Trading activity

Actually the Sales function involves all the management functions ( viz ) Planning ( Annual plans ), coordinating, organizing and controlling in a narrow perspective of selling the production compared to the broader perspective of Marketing function of the organization of framing plans and policies to achieve the objectives

The Sales function starts once the product is ready for dispatch. The magnitude of the work involved in the Sales function depends on the factors like type of product, direct selling or indirect selling method adopted, outsourcing, type of customer, market size, etc

For performing the sales function the Manager- In charge of Sales should perform the following activities like

1) Management of Show room sales
2) Distribution and net working management
3) Territory management for order canvassing
4) Logistics management
5) Personal selling management
6) Export marketing management
7) New product launching
8) Customer care management
9) Customer relationship management
10) Sales planning management
11) Collection of bill payments, etc facilitating all the transfers in the selling transaction taking place between the buyer and seller

The Manager performs all the above functions following the guidelines set by the Marketing department .The discretionary power of the Manager Sales will be restricted by the formulated policy of the Marketing function


III) CONCLUSION

The personnel engaged in Marketing function may be taking less number of decisions but which will be of very important in nature deciding the fate of the organization whereas the personnel engaged in Sales function may be forced to take more decisions but the failure to take correct decision may not be so adverse to put the company to sickness

Hence organizations use Top management expertise in carrying out the Marketing function leaving the execution function of Sales to the personnel who are in the second level

Organizations generally prefer to have less number of personnel for performing Marketing function ( personnel for Planning operation are generally costly ) than large number of personnel for executing Sales ( Executors of the Plans )

Article Source: http://www.upublish.info

About the Author:
V S RANGARAJAN
EDUCATIONAL QUALIFICATION B TECH, MBA, M PHIL, ( PH D ) EXPERIENCE INDUSTRIAL CONSULTANCY 18 YEARS INDUSTRY 3 YEARS TEACHING 5 YEARS

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