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Brand teams and the brand management structure in pharmaceutical and other fast-moving consumer goods companies

In the modern business environment, team building and the development of relationships with the various interfaces for the beneŽ t of their brands are very important activities for brand managers. This study examines an extending organizational
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  Brand teams and the brand managementstructure in pharmaceutical and otherfast-moving consumer goods companies CLEOPATRA A. VELOUTSOU Department of Business and Management, University of Glasgow, 21 Western Court,Glasgow G12 8SQ, UK GEORGE G. PANIGYRAKIS Department of Business Administration, The Athens University of Economics and Business,76 Patission Street, Athens 104-34, Greece In the modern business environment, team building and the development of relation-ships with the various interfaces for the benet of their brands are very importantactivities for brand managers. This study examines an extending organizationalphenomenon, namely the development of teams for effective brand management invarious local markets. In particular, it investigates the way brand managers in the fast-moving consumer goods and pharmaceutical industries comprehend team roles andactivities by analysing the allocation of their working time and the perceived contact andsignicance of relationships with their interfaces. Based on the product managementliterature, the structure of the local brand’s team was empirically examined using datacollected from a sample of 187 product managers working for 58 companies in differentsectors in Greece. The results show that four subgroups were developed in the varioussectors, but with different members. KEYWORDS: Brand management; marketing organization; teams; pharmaceutical industry; Greece INTRODUCTION: BRAND MANAGERS AND BRANDS’ SUPPORTING TEAMS The product/brand management system is a popular marketing organizational approach for theplanning and control of marketing activities. It was developed in 1927 by P&G (Lief, 1958;Eckles and Novotny, 1984; Howley, 1988) or maybe earlier by other owners–entrepreneurs(Dietz, 1973; Low and Fullerton, 1994). Despite doubts concerning its future ( Marketing  , 1994; The Economist  , 1994), it has been reported that, during the last 5 years, it was still being used bymultiple product companies all over the world (Low and Fullerton, 1994; Lysonski et al  ., 1995;Murphy and Gorchels, 1996; Hankinson and Cowking, 1997; Panigyrakis and Veloutsou,  JOURNAL OF STRATEGIC MARKETING 9 233–251 (2001)  Journal of Strategic Marketing ISSN 0965–254X print/ISSN 1446–4488 online © 2001 Taylor & Francis Ltd  1999a,b, 2000) and, internationally, most pharmaceutical companies adopt it (Kleizen et al  .,1985; Katsanis and Pitta, 1999; Panigyrakis and Veloutsou, 1999a).When it is applied, brand managers operate as coordinators and central transmitters of infor-mation for the brands for which they are responsible. They cannot do all the work and have allthe expertise for supporting their brands. For that reason they work with others by establishinga team (Diez, 1973; Kleizen et al  ., 1985; Lysonski, 1985; Dawes and Petterson, 1988; Hankinsonand Cowking, 1997), directing its members (Gemmill and Wilemon, 1972; Venkatesh andWilemon, 1976) and creating a team spirit.The concept of teamwork is not new in marketing practice (Boyd et al  ., 1959) and gives thebrand the exibility it needs for adapting to the changing environment. The idea of thedevelopment of an internal multidisciplinary brand team approach that will include the brandmanager or a manager working in the marketing department has been investigated (Thamhain,1990; Katsanis and Pitta, 1995; Andrews, 1996; Katsanis et al  ., 1996), mainly for teams that havebeen formed in order to assist new product development (Gupta et al  ., 1986; Bingham andQuigley, 1992; Denison et al  ., 1996; Pitta et al  ., 1996).Because of the team-based structures formed nowadays, it has become essential for brandmanagers to learn to work effectively both as team members and as team leaders (Katsanis et al  .,1996). Evidence suggests that, although they need to communicate across organizational andenvironmental boundaries (Lysonski, 1985; Lysonski et al  ., 1988, 1989; Panigyrakis and Glynn,1992; Panigyrakis and Veloutsou, 1999b), they frequently have limited direct authority andcontrol over the team members (Venketesh and Wilemon, 1976; Murphy and Gorchels, 1996)and must therefore secure support.Despite their limited input in the formation of the team, brand managers have to controlthe team and act as leaders and coordinators of this intercorporate group with members thatmay interact. Their overall objective is to provide support for their brands. They spend timein a number of different activities both inside and outside the organization in order to gainsupport (Quelch et al  ., 1987, 1992) and promote trust and respect among members in order to generate a better group performance by building a team that obtains results. As a consequenceof the brand manager’s job description, this process is automatic and to do it effectivelythey need to be integrators who enjoy relating to people from other departments or other companies.This study analyses the brand team’s structure and the members’ role in pharmaceutical andother fast-moving consumer goods companies as brand managers comprehend it. The investi-gation of the structure of the team will help in understanding the expected contribution andthe importance of the different members. This analysis has not been conducted in the past andthe role of the different team members in the success of brands is uncertain. By examining theperceived importance of the input of the various brand team members a step towards better management of brands can be made, since an attempt to explore the role of the various inter-faces in the management of brands and the implementation of brands’ programmes will bemade. MEMBERS OF THE BRAND’S SUPPORTING TEAM In spite of the fact that the examination of brand managers’ interfaces and communicationlinkages began three decades ago (Luck, 1969), the literature rarely analyses the structure of thebrand team and the role of the team members as they have evolved today. The existing literaturesuggests that they come from both the internal and external environments (Fig. 1). 234 VELOUTSOU AND PANIGYRAKIS  Internal company team members As a brand’s formation ows across the organization, every department has to contributeoptimally to the success of the brand (Rubinstein, 1996). Interaction with people in non-marketing areas can contribute to creativity, since they tend to focus on issues and problems thatdiffer from those identied by their marketing colleagues (Andrews and Smith, 1996). Today, inthe era of cross-functional interdependence, the analysis of the interfaces that the marketingdepartment develops with the various interfaces is of crucial importance (Lim and Reid, 1992)as the rm’s own information and support services must be made available to the brandmanagers (Lysonski et al  ., 1995). Brand managers work as internal marketers (Starr and Bloom,1994). The relationships developed among managers having the same aim, i.e. to support thebrand, but working in different departments will aid in the elimination of internal boundaryspanning and focus on the external activities, thereby satisfying the needs of retail customers andconsumers (McDaniel and Gray, 1980; Katsanis and Pitta, 1995).The internal interfaces that marketing departments and brand managers develop are usuallywith the other departments within the company such as superiors and other colleagues inthe marketing department (McDaniel and Gray, 1980; Panigyrakis and Glynn, 1992; Murphyand Gorchels, 1996), sales (Dawes and Petterson, 1988; Panigyrakis and Glynn, 1992;Murphy and Gorchels, 1996; Panigyrakis and Veloutsou, 1999b), manufacturing (Weinreuchand Anderson, 1982; Dawes and Petterson, 1988; Lysonski et al  ., 1989; Panigyrakis and Glynn, FIGURE 1.Members of the product/brand team. BRAND TEAMS AND BRAND MANAGEMENT STRUCTURE 235  1992; Crittenden et al  ., 1993; Murphy and Gorchels, 1996), accounting and nance (Kelly andHise, 1979; Dawes and Petterson, 1988; Lysonski et al  ., 1989; Panigyrakis and Veloutsou, 1999b),research and development (Lysonski et al  ., 1989; Murphy and Gorchels, 1996; Song et al  ., 1996),personnel (Panigyrakis and Veloutsou, 1999b) and top management (McDaniel and Gray, 1980;Quelch et al  ., 1987, 1992; Panigyrakis and Glynn, 1992).The daily contact with the various corporate departments and the dependence itimplies creates problems, which are usually due to cultural and/or knowledge gaps amongthe managers working in these departments (Harison, 1978; Chadwick and Ratnunga, 1981;Konijnedijk, 1993). The effective use of the time that brand managers spend on variouscommunications with their colleagues working for the company may contribute to overallcorporate effectiveness (Sizer, 1973). Many organizations and executives are trying to imple-ment programmes that aim to reduce any kind of possible conict, provide cross-functionalexposure and improve understanding (Trebuss, 1984; Ratnatunga et al  ., 1990; Crittenden et al  ., 1993).  External to the company team members Professional service rms provide the input that will facilitate or add value to rms’ brandsand try to develop an ongoing buyer–seller relationship (Filiatrault and Lapierre, 1997). Thereis a growing awareness in the marketplace of the possible advantages to be derived from long-term relationships between business partners. Although there is no generally accepted denitionof what a professional service is (Dawes et al  ., 1992), professional service providers do act asexperts for clients, assisting them in problem solving and decision making (Maister and Lovelock,1982).Given the widespread use of management consultants and service providers and the growthof the area (Dawes et al  ., 1992; Brentani and Ragot, 1996), it is surprising to nd that littleempirical research has been published on this topic (Dawes et al  ., 1992), as literature dealing withmarketing personnel restricts its attention to the contacts developed with the internal servicesproviders and not those with the various external industrial service suppliers (Harrison, 1978;Chadwick et al  ., 1981; Trebuss, 1984; Gupta et al  ., 1986; Ratnatunga et al  ., 1990; Crittenden  et al  .,1993; Konijnendijk, 1993; Mahajan et al  ., 1994; Song et al  ., 1996). The number and varietyof rms offering industrial services that brand managers deal with have increased dramatically,rating from one-person public relations rms and specialized corporate lawyers to multinationalcompanies such as advertising and marketing research agencies (Lysonski et al  ., 1989; Dawes et al  ., 1992), but there is no research at the moment that evaluates the role and importance of these industrial sellers in the brand’s team.More specically, brand managers have to collaborate and negotiate with the advertisingagency (Diez, 1973; Buell, 1975; Duker and Laric, 1981; Cummings et al  ., 1984; Dawes andPatterson, 1988; Howley, 1988; Panigyrakis, 1989; Murphy and Gorchels, 1996), the promotionalagency (Panigyrakis, 1989; Panigyrakis and Veloutsou, 1999b), the public relations agency (Ryanand Lemmond, 1989; Panigyrakis and Veloutsou, 1999b), the marketing research agency (Diez,1973; Murphy and Gorchels, 1996), lawyers (Panigyrakis, 1989; Panigyrakis and Veloutsou,1999b), the distribution channels (Hise and Kelly, 1978; Cummings et al  ., 1984; Panigyrakis andGlynn, 1992; Murphy and Gorchels, 1996) and other consultants, such as experts in informatics,physiologists or designers (Panigyrakis, 1989; Bondra and Davis, 1996; Panigyrakis and Veloutsou,1999b). 236 VELOUTSOU AND PANIGYRAKIS  THE MANAGEMENT OF BRANDS IN THE PHARMACEUTICAL INDUSTRY Traditionally pharmaceutical companies have research and development and sales as the centre of their operations, while competition is based mainly on technology. In the marketing literaturethere is evidence that pharmaceutical companies manage their products and apply the brandmanagement structure differently (Kleizen et al  ., 1985; Panigyrakis, 1994; Panigyrakis andVeloutsou, 1999a). For example, pharmaceutical products are promoted internationally, prin-cipally through the development of relationships and exchange of information between salesrepresentatives (missionary sales personnel) and physicians (doctors) (Williams and Hensel, 1991;Andaleeb and Tallman, 1996; Pinto et al  ., 1998). Furthermore, brand managers tend to developdifferent interfaces (Panigyrakis and Veloutsou, 1999b). Some of the differences in the manage-ment of pharmaceutical brands might be due to the role of the government in the sector andthe way that the products are purchased, i.e. via prescription.Recent changes in the environment, such as the removal of trade barriers, modicationsto legislation in the European Union and the launch of more global drugs (Chaudhry  et al  .,1994; Earl-Slater, 1996a,b, 1997, 1998), have reduced national protection of the pharmaceuticalindustry in individual European countries. Furthermore, the Greek Government is trying toreduce health care costs, with spending on drugs a primary target. The enforcement of a xedbudget for drugs prescribed by doctors and the development of a list with certain medicalproducts that can be prescribed to patients within the public health system are just some of themeasures that appear to be inuencing overall marketing programmes in the pharmaceuticalindustry. It is important to say that, at the moment in Greece, a consumer is free to buymany more pharmaceutical products without a doctor’s prescription than in any other Europeancountry. This will encourage promotional activity, as pharmaceutical companies will have todevelop new ways of communicating with their nal customers. These changes will affectpharmaceutical brands. Advertising, promotional and marketing research agencies are expectedto play a more active role, particularly for drugs that are widely used and do not need a doctor’sprescription.The expected changes in this industry in Greece have already started happening in other national markets. Even though many pharmaceutical companies internationally have neglectedmarketing, practitioners believe that there is an increasing need for developing stronger pharma-ceutical brands (Ingold, 1999). Some of the recent developments in the practices employed inthe industry indicate that companies are already dedicating some effort in this direction. For example, in the USA there has been an increase in direct to consumer advertising, even for prescription drugs and patients often request drugs by brand name (Pinto et al  ., 1998; Wilkes,2000). Although the legislation in the USA is very different from that of Europe, it is foreseenthat European patients will develop a greater awareness of the brands within the industry. RESEARCH OBJECTIVES AND PROPOSITIONS The purpose of this study is to add to the limited scope of knowledge regarding the character of a brand’s team. The importance of more effective teamwork in achieving marketing activitieshas been recognized in previous studies (Hankinson and Cowking, 1997), although thereis limited, if any, research on analysis of the structure of brand teams. Recent research has con-centrated on analysis of the relationships that marketing departments form in general, mainlywith intracompany service providers (Harrison, 1978; Chadwick et al  ., 1981; Trebuss, 1984;Gupta et al  ., 1986; Ratnatunga et al  ., 1990; Crittenden et al  ., 1993; Konijnendijk, 1993; Mahajan BRAND TEAMS AND BRAND MANAGEMENT STRUCTURE 237
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