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MARKETING INTEGRATION IN MULTILEVEL CONTROL SYSTEMS FOR TERRITORIAL AND BRANCH DEVELOPMENT
Abstract
The paper attempts to develop the multilevel control system for territorial and branch development in market conditions. The system is constructed on the basis of wide use of different types of marketing (Lavrov & Polikarpova, 2012) and their horizontal and vertical integration.
Keywords
territorial competitive positions, branch competitive positions, integration, control system for territorial and branch development
AUTHORS
Alexander Lavrov Lada Polikarpova
PhD in Economics, Professor PhD in Economics, Associate Professor
head of the Department of Marketing Department of Marketing
Kemerovo State University Kemerovo State University
Kemerovo, Russia Kemerovo, Russia
lavrov@kemsu.ru lada_polikarpova@mail. ru
Alla Handramay
PhD in Economics, Associate Professor
Department of Economic Theory,
Taxation, Business and Right
Kemerovo State University
Kemerovo, Russia
khand-alla@yandex.ru
Effective management of territorial-branch development in market conditions requires development of theoretically reasonable principles and provisions, which allow to consider nature of interrelation of branches and territories in the conditions of open economy and determine necessary parameters of effective interaction of various subjects of management.
To solve the above problem it is offered to use the multilevel control systems for territorial and branch development constructed on the basis of wide use of different types of marketing and their horizontal and vertical integration. Nowadays forms and methods
of marketing activity integration in difficult multilevel control systems of development of branches, fields of activity and territories are rather poorly described 'n economic science.
There are three levels of management: micro, meso - (with three sublevels: municipal, regional, district) and macro- levels. Each level (sublevel) has territorial and branch aspects of management. The basic tools are the following types of marketing: territorial marketing, branch marketing, investment marketing. "Common grounds" of various instruments of marketing are defined for effective integration of marketing.
Each level (sublevel) of management with methods of territorial and branch marketing forms, assesses and analyzes territorial (TCP) and branch (BCP) competitive positions of the corresponding objects of management. Micro-level of management deals with TCP and BCP of the branch enterprise; municipal sublevel deals with TCP and BCP of municipality; regional sublevel deals with TCP and BCP of the region, etc.
Horizontal integration of territorial and branch marketing at each level (sublevel) of management allows to form, estimate and analyze the territorial and branch competitive positions (TBCP), which together with TCP and BCP are the basis for development of investment offers.
The conducted research offers the corresponding techniques for implementation of these procedures, which are based on carrying out the first stage of SWOT-analysis (i.e. designation, assessment and analysis of corresponding strong and weak sides).
The second stage of SWOT-analysis comes further to determine the main directions of development at each level (sublevel) of management. Thus, the assessment of factors of environment is carried out with use of PEST-analysis. We offer to allocate four levels of influence of spatial environment in a multilevel control system of territorial and branch development: municipal, regional, district and national.
When using PEST-analysis we accepted a set of four basic groups of factors (political-legal, economic, welfare and technological). They are various, but highly depend on each other at each level of influence. Essential change of one factor is capable to make strong impact on development of management object both from threat and termination of development, and from opportunities for perspective development.
The opportunities and threat revealed by means of PEST-analysis can considerably differ on the level and force of impact on development of management object. In this regard, use of assessment of the importance along with assessment of probability of emergence of these or those opportunities and threats is lawful.
The quality and quantitative assessment of factors allows to exclude from further consideration insignificant and improbable factors, which do not have any practical importance for development of directions. It is expedient to classify them in a format of a two-dimensional matrix (Figures 1, 2). There are four areas are allocated in the matrix. They are characterized by standard recommendations as reaction on opportunities and threats depending on force and probability of their emergence.
5
u
£ 0
1 monitoring 2 use
4 ignoring 3 research
0 1
Probability
FIGURE 1. CLASSIFICATION OF OPPORTUNITIES DETERMINED BY ENVIRONMENT
cu u
1 preparation 2 opposition
4 lack of danger 3 monitoring
0 1 Probability
FIGURE 2. CLASSIFICATION OF THREATS DETERMINED BY ENVIRONMENT
Creative approach to assess PEST-factors at each level (sublevel) of management allows to make the cumulative analysis of the allocated territorial, branch and territorialbranch competitive positions with the most probable opportunities and threats; to create and place priorities for the directions of development and perspective investment offers.
Thus, instruments of territorial and branch marketing, their horizontal integration allow to receive a set of perspective investment offers at each level (sublevel) of management, i.e. to create investment fields (Figure 3).
Investment field at microlevel
Investment field at municipal sublevel
Investment field at regional sublevel
Investment field at district sublevel
Investment field at macrolevel
FIGURE 3. INVESTMENT FIELDS OF MULTILEVEL CONTROL SYSTEM OF TERRITORIAL-BRANCH DEVELOPMENT
The next basic element of the offered multilevel control system of territorialbranch development is procedure of "corridor" formation. The "corridor" coordinated on levels (sublevels) describes investment development, coordination and specification of parameters of investment offers. The base of this procedure is instruments of vertical integration of territorial and branch marketing.
The investment offers created at each level (sublevel) of management on the basis of territorial (TCP) competitive positions, industry (BCP) competitive positions, territorial and branch (TBCP) competitive positions in comparison with environment factors at this stage are agreed already with the created investment offers of external levels (sublevels) in relation to this level. In fact, it is demand environment for investment offers of the considered level (sublevel) of management. Start of vertical
integration procedure coordinate parameters of investment offers and form "corridor" of investment development by coordination of demand and offers vectors.
Based on the mechanisms of horizontal and vertical integration of marketing described above, the general model of functioning of a multilevel control system of territorial-branch development is developed (Figure 4). Each level (sublevel) of management includes 5 stages.
FIGURE 4. MODEL OF A MULTILEVEL CONTROL SYSTEM OF TERRITORIAL-BRANCH DEVELOPMENT
At the first stage, each level (sublevel) of management realizes processes of territorial and branch marketing for definition and assessment the corresponding competitive positions. Then procedure of horizontal integration starts. This stage has the following sequence of actions and participants:
1) the complex analysis of competitive positions of management object in territorial and branch aspects:
1.1) branch (production) divisions of management subject are allocate, estimate and analyze branch competitive positions of management object;
1.2) economical divisions of management subject allocate, estimate and analyze territorial competitive positions of management object;
1.3) the assessment of strong and weak territorial and branch competitive positions (the first stage of SWOT-analysis) is carried out;
2) TBCP of management object are formed by integration of branch (production) and economical divisions. It is possible within formation of joint commissions, groups, etc., including experts of branch (production) and economical divisions.
It is necessary to notice that the branch competitive positions (BCP) and territorialbranch competitive positions (TBCP) are formed for all branches and fields of activity at meso- and macro-levels of management.
The second stage contains PEST-analysis of environmental factors; the most "powerful" and effective for development of the territory and branches of TCP, BCP, TBCP are allocated; investment offers of territorial and branch development are developed.
The created investment offers at this level (sublevel) of management are coordinated with investment offers of external levels (sublevels) in relation to the considered level. Procedure of vertical integration coordinates parameters of investment offers and forms "corridor" of investment territorial-branch development from bottom to top and from top to bottom.
The third stage forms the complex of investment marketing. Its main objective is search of investors.
The marketing mix complex is developed for investment offers; tools for its adaptation to investors' needs, estimation of cost, advance and organization of interaction processes (Figure 5) are selected.
It is necessary to conclude that performing all above actions marketing activity of management subjects is directed on active work in the market of investments, on mixing investment marketing for each group and even the certain investor.
The fourth stage finishes the investment offers to the level of investment projects based on the official demand of investors; the relevant contracts are signed. At all levels of management, investment projects are consolidated in investment programs of appropriate management levels.
The fifth stage of the model carries out standard procedures for monitoring implementation of investment projects and programs; analyzes the reasons of deviations, updates the program documents directed on coordination of interaction of all elements of control system and controls their efficiency. The cycles of functioning repeats.
Investment offers (10)
FIGURE 5. THE SCHEME OF INTERACTION OF MANAGEMENT SUBJECTS OF VARIOUS LEVELS
WITH INVESTORS IN THE INVESTMENT MARKET
These are the general approaches to organization of administrative activity in a multilevel control system of territorial-branch development. The micro-level of management develops the investment offers, projects and programs based on TCP, BCP and TBCP parameters of enterprises and organizations with use of tools and integration of territorial, branch and investment marketing. The meso-level and macro-level of management develops investment projects and programs for formation of steady conditions of development of the respective territories and branches also based on TCP, BCP and TBCP parameters, tools and integration of territorial, branch and investment marketing. The model of multilevel management of territorial-branch development is built in such a way that the principle of coherence of interests of all management subjects is observed.
REFERENCES
1. Lavrov, A. M. & Polikarpova, L. A. (2012) "Use of management and marketing in formation of the market focused model of management of development of the region", Bulletin of the Kemerovo State University, Moscow, No. 3 (51), pp. 284-287.
