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4 Steps and 3 Directions to Double Marketing Performance
Most Chinese companies' marketing management is not yet mature. As long as PDCA is applied to marketing management, and through continuous optimization of each point in the management process, these points—though independent yet part of a whole—can undergo qualitative and quantitative changes, elevating management to a higher level and achieving competitive advantage. Success is the result of a model, and a model is the result of thought. Therefore, by continuously using PDCA, even in the face of drastic changes in the business environment, new and more suitable models will surely be found.
Process and Application
Step 1: Plan In the marketing management process, plans include five-year, three-year, and one-year plans, further broken down into monthly, weekly, and even daily plans. Each unit of the marketing organization also needs to formulate various plans, such as new product launch plans and annual promotion plans. Plans are everywhere.
The importance of meticulous planning has never been doubted. However, in practice, many people view standard marketing plan templates as mere formalities, tasks to complete for the boss, or as rigid stereotypes—believing that performance is achieved through action, not planning. Thus, at the end of each year, when comparing against the previous year's marketing plan, and when the boss asks which items were achieved and which were not, the huge gap between the plan and reality becomes apparent. Moreover, because the plan's budget was not fully prepared, marketing tasks often cannot be completed, constrained by management and financial controls, eroding mutual trust. Furthermore, because marketing is so important, it absolutely cannot be done solely by the marketing department. The correct approach is to standardize the format of the "marketing plan." If anyone wants to change the format, they must provide extremely strong reasons for optimization before making changes.
Step 2: Do After the plan is formulated, execution follows, including the eight steps of sales visits, route visits, face-to-face communication, impactful displays, and negotiations with chain supermarkets.
Even in marketing companies, marketing management is not independent of the normal operations of the enterprise; it often requires coordination from finance, procurement, production, management, and other departments. Within the marketing organization, there is also coordination between sales and marketing departments, and among sales sub-teams. How to coordinate should be formalized into processes and systems to solidify the effectiveness of this coordination. In practice, through the efficiency of problem-solving, these processes can be continuously optimized to enhance organizational operational efficiency. When the enterprise and market environment are calm, no one feels how important organizational coordination is. But when problems arise, everyone painfully realizes that the enterprise has never recognized the importance of "coordination," nor even made basic preparations—the enterprise has been "running naked" all along.
Step 3: Check Checks in the marketing process include superiors checking subordinates' execution, the company's inspection department auditing various functional departments, the marketing department checking the use of marketing expenses in channels, and joint visits with line supervision.
To ensure the achievement of the plan, the effectiveness of checks is reflected in several aspects: First, is the plan being vigorously executed? Many great plans fail because of laxity in the checking phase, leading to lax execution. Management sages were absolutely right: employees do not do what you tell them to do; they do what you inspect and assess. Second, checks are necessary to discover parts of the plan that can be optimized, such as changes in the execution environment due to new circumstances, potential deviations in direction, the emergence of new opportunities, imbalances in resource allocation, and the creation of new methods. We can even say that checking is the second life of the plan.
Step 4: Action After identifying problems, there are two directions for action: one is to correct non-compliant behaviors, and the other is to correct problems in the plan itself. These ultimately form feedback reports and eventually become new systems and execution documents.
In the marketing process, compared to the sales department, the marketing department seems more critical in the application of PDCA. Since the marketing department's function is to determine the marketing direction and involves significant expenditure, if there are deviations in details, many problems will arise in sales execution, and it will also cause huge losses in money, time, and manpower. Generally, managers keep a close eye on employee wages and expenses, but from the financial statements, the actual cost of personnel is only about 4% of total expenses, while marketing expenses are 10%–20%. A large amount of facts show that the waste of marketing expenses in the marketing process can reach 5% or even more. If PDCA analysis and review are repeatedly conducted, this waste can be reduced to below 3%.
Adjustment and Direction
Direction 1: Management Maintenance (Continuous) Many companies, when taking stock at the end of the year, feel that the unsatisfactory marketing management of the year was due to the lack of better methods. Therefore, they often think about how to make changes or adopt new means in the coming year's operations. But by the next year, these new means are deemed not good enough, leading to disappointment or continued searching for new methods. Meanwhile, employees, amidst constant changes, gradually become like the man from Handan who tried to learn to walk in Handan and forgot how to walk himself, ultimately not knowing how to proceed.
Marketing management, even in the most successful companies, often wins through solid basic skills. Therefore, when problems arise, the first thing to reflect on is whether the marketing management system formulated by the enterprise itself has been implemented faithfully and thoroughly. World-class companies like General Electric, Johnson & Johnson, and Procter & Gamble absolutely do not believe in the various excuses salespeople make, even if it is due to a poor market environment or limited consumer purchasing power. They prefer to believe that it is related to whether the marketing plan has been effectively executed. Therefore, the control method they adopt to ensure performance is frontline investigation. Frontline investigation can be conducted in two ways: one is through joint sales visits by supervisors and subordinate executors; the other is through unannounced field visits by supervisors.
Direction 2: Management Innovation (Incremental) Management innovation is the result of optimizing the existing system based on a well-established marketing management system. This result inherits and develops the original system, often bringing a comfortable atmosphere of unity and smooth implementation. Many marketing department heads require their team members to continuously devise various dazzling promotional plans because they face a problem: if promotions stop, sales stop. And if they continue using previous plans, they may think those plans are outdated.
In the training that Guangzhou Mingdao Consulting implemented for Qiaqia Melon Seeds, we found that many of Qiaqia's promotional activities were carried out by sticking yellow self-adhesive labels on the front of the outer packaging. Compared to normal packaging, this was eye-catching and prominent. Many companies in the FMCG industry do this, and they have used it for a long time, seeing no problem. Through our inspiration, Qiaqia's product managers gradually realized that if the yellow promotional notice were printed directly on the outer packaging where the self-adhesive label was originally placed, it would be just as eye-catching as the original label, and it would save a lot of costs and the labor time of "sticking the label." All these costs are saved by this small change.
Direction 3: Management Transformation (Radical) When a company's development is stagnant for a long time or wants to break through the limitations of the industry's growth model, management transformation is needed. Whether it is the determination of "to practice the divine skill, one must first castrate oneself" or the courage to cut off one's own wrist, these are decisions made by managers determined to change their fate. Management transformation is usually accomplished through external forces or external brains, such as Lou Gerstner parachuting into IBM; or initiated by newly appointed leaders who deeply understand the company's underlying situation, such as Jack Welch taking charge at General Electric; or through close guidance from think tanks, such as McKinsey's guidance for Master Kong.
Before July 1998, Master Kong's marketing management model was the large distributor system. In the same industry, competitors almost all adopted the same marketing model. However, Master Kong felt that this model could not break through the encirclement. In 1998, Master Kong decided to invite the internationally renowned consulting firm McKinsey & Company to help. Based on their understanding of the Chinese market and Master Kong's current situation, McKinsey provided a solution called "channel intensive cultivation." This solution allowed Master Kong to flourish everywhere, developing a large number of small regional distributors. This model helped Master Kong defeat one strong enemy after another in the Chinese market. Even when the entire industry was suffering losses, Master Kong maintained double-digit growth in sales and profits—truly a management miracle. If you can continuously use the magic of PDCA, you will believe that this is not a miracle at all. (This article is excerpted from the training course "PDCA Team Management Magic" by Chen Xiaolong, General Manager of Guangzhou Mingdao Marketing Consulting Co., Ltd.)
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