Effective organizational beaming requires high absorptive capacity, which has two major elements: prior knowledge base and intensity of effort. Hyundai Motor Company, the most dynamic automobile producer in developing countries, pursued a strategy of independence in developing absorptive capacity. In its process of advancing from one phase to the next through the preparation for and acquisition, assimilation, and improvement of foreign technologies, Hyundai acquired migratory knowledge to expand its prior knowledge base and proactively constructed crises as a strategic means of intensifying its beaming effort. Unlike externally evoked crises, proactively constructed internal crises present a clew performance gap, shift beaming orientation from imitation to innovation, and increase the intensity of effort in organizational learning. Such crisis construction is an evocative and galvanizing device in the personal repertoires of proactive top managers. A similar process of opportunistic learning is also evident in other industries in Korea.
This article presents a meta-analysis of prior econometric estimates of personal selling elasticity—that is, the ratio of the percentage change in an objective, ratio-scaled measure of sales output (e.g., dollar or unit purchases) to the corresponding percentage change in an objective, ratio-scaled measure of personal selling input (e.g., dollar expenditures). The authors conduct a meta-analysis of 506 personal selling elasticity estimates drawn from analyses of 88 empirical data sets across 75 previous articles. They find a mean estimate of current-period personal selling elasticity of .34. They also find that elasticity estimates are higher for early life-cycle-stage offerings, higher from studies set in Europe than from those set in the United States, and smaller in more recent years. In addition, elasticity estimates are affected significantly by analysts’ use of relative rather than absolute sales output measures, by cross-sectional rather than panel data, by omission of promotions, by lagged effects, by marketing interaction effects, and by the neglect of endogeneity in model estimation. The method bias–corrected mean personal selling elasticity is approximately .31. The authors discuss the implications of their results for sales managers and researchers.
Previous research on marketing budget decisions has shown that profit improvement from better allocation across products or regions is much higher than from improving the overall budget. However, despite its high managerial relevance, contributions by marketing scholars are rare. In this paper, we introduce an innovative and feasible solution to the dynamic marketing budget allocation problem for multiproduct, multicountry firms. Specifically, our decision support model allows determining near-optimal marketing budgets at the country–product–marketing–activity level in an Excel-supported environment each year. The model accounts for marketing dynamics and a product's growth potential as well as for trade-offs with respect to marketing effectiveness and profit contribution. The model has been successfully implemented at Bayer, one the world's largest pharmaceutical and chemical firms. The profit improvement potential is more than 50% and worth nearly €500 million in incremental discounted cash flows.
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