The Hindu Business Line : Marketing function needs to be re-engineered: Jagdish Sheth

MARKETING is losing its pre-eminence as a discipline in boardrooms today and there is a need to radically re-engineer the marketing function in corporations and move it from the decentralised line function it is now to a staff function, directly reporting to the CEO of the corporation, says Dr Jagdish Sheth, marketing guru and Charles H. Kellstadt Professor of Marketing, Emory University.

"Today, it is to the CEO that the CFO and HR head report, as does the CIO. However, marketing is decentralised by divisions, by business units and even by product categories. So, it is three levels below," said Dr Sheth, in an interview to Business Line, prior to his talk as the chief guest at the inauguration of the Ph.D programme of the Loyola Institute of Business Administration on Wednesday.

Forthright in his views, Dr Sheth said that today, in most corporations in the US, there is no chief marketing officer talking at the boardroom. "It's losing its pre-eminence as a discipline in the boardrooms in advanced countries," he said.

Elaborating, Dr Sheth says, "I've challenged marketing professionals in the US, asking them to give one major idea in the past quarter of a century that the CEO and the board have got excited about." He refers to customer satisfaction, which didn't come from marketing but grew out of the quality movement. Or, as he points out, Internet marketing, which came from technology people. "There is not a single idea which we have created which became a passion for the company. One idea is we should be customer-focused, but then that's a motherhood statement. And, even the idea of creating value for customers has not come from marketing, but from operations people," emphasises Dr Sheth. In that context, he says that marketing needs to be re-engineered as a discipline.

Marketing needs to touch the CEO's office as, in his view, seven stakeholders in a company need to be marketed to effectively: employees, customers, shareholders, suppliers, the local community, government and the media. "This multi-stakeholder view of marketing is important and I am advocating that," said Dr Sheth.

Talking about the 4 As of marketing, which he postulated — awareness, acceptability, affordability and accessibility — as opposed to Philip Kotler's well-known 4 Ps of marketing, Dr Sheth said that marketing is primarily about creating awareness and acceptability but had never focused on affordability.

Referring to management guru C.K. Prahalad's exposition on the "bottom of the pyramid approach" he said that affordability had become a key opportunity and if marketers could break that barrier by redesigning the product to make it affordable and accessible, new markets would open up. "Most marketing dollars are not spent well on these two activities. The framework is catching on. A customer will not be willing to make a trade-off. He won't say give me the best product and I am willing to pay more for it."

Traditionally, Dr Sheth says, that is how marketing got organised: differentiation and finding out ways to charge more. However, the best marketing is simple. If a company's products are superior, from a customer viewpoint, and with lower prices, he would buy the product forever. "The company that is winning worldwide with such a simple idea is Toyota, which has understood and managed this paradigm," says Dr Sheth.

Later, Dr Sheth, an alumnus of the hoary Loyola College — he graduated in 1960 with a B.Com. degree — delivered the inaugural address on the theme `making India competitive' to the students and faculty of LIBA. Also present were Father P. Christie, Director, LIBA, Fr Jeyaraj, Rector, Loyola College and Dr Anne Mary Fernandes, Registrar, University of Madras.