Entrepreneurial Approach as a Change Agent to the Process of
Marketing Planning
Ravi Bhat
Unitec Business School
Unitec, Carrington Road, Mt Albert, Auckland.
Tel: (09)815-4321 Extn. 7046
E-mail: rbhat@unitec.ac.nz
&
Renu Joshi
School of Business,
The Open Polytechnic of New Zealand, Lower Hutt,
Tel: (04)9145252,
Email: renu.joshi@openpolytecnic.ac.nz
&
Denisa Hebblethwaite
Unitec Business School
Unitec, Carrington Road, Mt Albert, Auckland.
Tel: (09)815-4321 Extn. 8476
E-mail: dhebblethwaite@unitec.ac.nz
NZ Applied Business Education Conference 2007
Otago Polytechnic
Bay of Plenty Polytechnic,
Dunedin
September 26 - 28, 2007.
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Entrepreneurial Approach as a Change Agent to the Process of
Marketing Planning
ABSTRACT
The business landscape of New Zealand is in a state of slow and ongoing change.
Many of our better-managed SME’s are successfully responding to pressures of
competitive forces and complexity and incessant developments in the wider business
environment. Entrepreneurship within these organizations seems to be their principal
agent of change and is characterized by ongoing innovation, proactiveness and risk
taking behaviours. To achieve success they are integrating entrepreneurial marketing
techniques into their planning process to formulate their strategic marketing plans.
However, within most other organizations a trading and commodity mind set still
prevails, or entrepreneurial activity is ad hoc, and marketing is continuing to be
practiced in a tactical manner through use of personal networks and promotional
techniques.
Entrepreneurial marketing is a relatively undeveloped discipline in the curricula of the
New Zealand tertiary institutions even though innovation and entrepreneurship
programs have grown dramatically overseas. Entrepreneurial marketing envisions the
business of marketing and organizational existence differently. Entrepreneurial
marketing sees ongoing entrepreneurship as a change agent of the marketing
discipline. It assigns the role of continuous value creation to marketing through
pursuit of opportunity and innovation, risk taking, and resource leveraging as against
ensuring incremental improvement in performance – the traditional approach of
marketing.
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This paper develops a conceptual framework using the entrepreneurial approach for
marketing planning that could be effectively used by our entrepreneurs/businesses.
The model proposed draws from well-known frameworks on marketing planning and
the entrepreneurial process, and synthesizes relevant theories from these disciplines
(Morris et al: 2001; Brooksbank: 1996; Kotler: 2000, Guilitinan et. al. 1997) into a
practicable concept. Methodology used includes secondary data from literature
searches of entrepreneurship and strategic marketing disciplines. The proposed model
could also be used to teach the NZDipBus course Marketing Planning and Control
offered by tertiary institutes in New Zealand. This could eventually lead to “win –
win” situations for both our students and the SME’s that employ them.
Introduction
A conceptual entrepreneurial marketing planning framework is proposed; based upon
a variety of frameworks in entrepreneurship and related disciplines (Morris et al:
2001). The marketing planning framework is integrated with entrepreneurial character
themes, entrepreneurial orientation and the entrepreneurial process. The need for a
consolidated entrepreneurial marketing planning framework is recommended to
facilitate the learning experience of students in the NZDipBus Marketing Planning
course.
Background
Entrepreneurship is associated with adaptation and change of economic systems, often
contributing to national economic growth (Bygrave, Reynolds & Autio, 2004: 5).
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Kuratka and Hodgetts (2004: 3) introduce entrepreneurship as, “an integrated concept
that permeates an individual’s business in an innovative manner”. Entrepreneurs are
individuals who recognize opportunities, being possible aggressive change catalysts
within the marketplace. Halloran (1994: 4) defines an entrepreneur on a broad basis,
as “one who assumes the risk of gaining profits or incurring losses in the undertaking
of commercial transactions.” This definition includes entrepreneurs from all walks of
life, and it may be useful to incorporate ‘calculated’ risk to make the definition more
meaningful to successful entrepreneurs.
It is against this background of entrepreneurism that frameworks are developed to
encourage sustainability of entrepreneurial activity of SME’s. Frameworks may be
evaluated as basic conceptual structures of ideas, being a logical and systematic way
to organize a phenomenon (Merriam-Webster: 1999). Applicable frameworks include
relevant variables that constitute entrepreneurial activity, and bring structure to
entrepreneurial components in terms of the ways in which they relate to one another.
The framework used is the framework of the entrepreneurial process (Morris, Kuratko
& Schindehutte, 2001: 40). This framework is considered along with the basic
frameworks of marketing planning. Finally, a conceptual framework of the
entrepreneurial marketing process is introduced, with the aim of enhancing
sustainability of entrepreneurial ventures.
Methodology
A literature review is conducted in the related fields of strategy, management,
entrepreneurship and marketing. The opportunity to develop an innovative and
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entrepreneurial oriented framework for marketing planning is based on the finding
that more clarity is required in delivering entrepreneurial marketing understanding to
tertiary students.
Entrepreneurial frameworks
Structures of ideas are depicted in a logical and systematic way to organize
phenomena (Merriam-Webster: 1999). They serve to identify the relevant variables or
components that constitute some subject area of interest, while also bringing order or
structure to these components in terms of the ways in which they relate to one
another. A framework provides the entrepreneur with a blueprint that converts
abstraction into order, allows prioritization of variables or issues, and helps identify
relationships (Morris et al: 2001). The development of the entrepreneurial marketing
planning model in this study is conceptual in nature, with the purpose of aiding
sustainability of entrepreneurial ventures. In this paper, an integrative framework for
understanding entrepreneurial marketing planning is proposed, incorporating the
entrepreneurial process (Morris et al (2001). The purpose is to explain and expand on
entrepreneurial marketing planning.
The entrepreneurial process as identified by Morris et al (2001) postulate that
entrepreneurial events are easier to understand and likely to achieve better results
when approached as a process. The entrepreneurial process is broadly implemented,
from small ventures to corporate entrepreneurship. Moreover, the processes are
sustainable, identifying entrepreneurship as ongoing or continuous at the individual or
organizational level. The Morris et al (2001) framework consists of six interdependent
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stages. The framework is depicted in figure 1. The ideation phase of the process is
represented in the first two stages, opportunity identification and business concept
development. The remaining stages are concerned with implementation, representing
the acquisition of necessary resources, implementation of the concept, managing and
eventually harvesting the venture. Key decision variables or alternatives are also
depicted at each stage of the process.
FIGURE 1
Identify an opportunity
Develop the concept
Determine the required
resources
Acquire the necessary
resources
Implement and manage
Harvest the venture
Framework of the entrepreneurial process
Changing demographics
Emergence of new market segments
Process needs
New technologies
Incongruities
Regulatory change
New products
New services
New processes
New markets
New organisational structure/forms
New technologies
Skilled employees
General management expertise
Marketing and sales expertise
Technical Expertise
Financing
Distribution Channels
Sources of supply
Production facilities
Debt
Equity
Leveraging
Outsourcing
Leasing
Contract labour
Temporary staff
Supplier financing
Joint ventures
Partnerships
Barter
Implementation of concept
Monitoring of performance
Payback of resource providers
Reinvestment
Expansion
Absorption of new concept into mainstream
operations
Licensing of rights
Family succession
Sell venture
Go public
Social change
New sales or distribution channels
Licences, patents and legal protection
Gifts
Achievement of performance goals
Shut down venture
(Source: Morris, Kuratko & Schindehutte, 2001: 40).
Marketing Planning and an Entrepreneurial Focus
The marketing plan is one of the most important outputs of the marketing
management process and could benefit any entrepreneur (Abratt, Beffon and Ford:
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1994). Various authors’ exhibit similar contents of marketing plans (Kotler: 2000;
Chaston: 2000), yet few integrate an entrepreneurial perspective. This study proposes
a conceptual framework integrating entrepreneurial thought into marketing strategy
and planning.
Guiltinan Paul and Madden (1997) developed a conceptual model of the marketing
planning and management process, incorporating phases of analysis, establishing
objectives, developing strategies and programs, and coordinating and controlling.
Their method integrates marketing planning at the corporate level with that at the
individual product/product line level. They further introduced facets of marketing
philosophy and optimum market results as a starting and conclusive point
respectively. To this end, they underpinned three fundamental principles to the model:
adoption of a marketing orientation by taking leads from the market; secondly,
achieving a fit between customers needs and organisations’s capabilities and profit
goals, and thirdly implementing the marketing concept in a highly coordinated
manner using a comprehensive planning approach and a long term perspective.
The proposed Entrepreneurial Framework for Marketing Planning model (fig. 2)
considers the framework of entrepreneurial process (Morris et al: 2001). It integrates
synergistically all six stages of the process in the marketing planning framework and
builds on the model proposed by Guiltinan et. al. (1997)
In the past innovations or entrepreneurial process in organizations generally evolved
outside of the marketing function in response to aggressive competitor moves,
changes in the market structure or within the industry, regulatory threats or external
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factors (Schindehutte et al. 2000). Marketing on the other hand has largely
concentrated on ensuring satisfaction of customer needs with the organization’s
offering and processes. To achieve this marketing process has focused on incremental
improvements in performance of existing offerings in line with the roles of a
supporter and reactor of entrepreneurial activity (Schindehutte et al. 2000).
Increasingly, however, marketing is being expected to play a more proactive role in
the entrepreneurial activities of the organization and become responsible for leading
the customer as against reacting to forces. For marketing to undertake the role of an
initiator and champion of entrepreneurial activity (Schindehutte et al. 2000) it is
essential that marketing planning incorporates real entrepreneurial activities in its
framework such as conceptualizing major opportunities and acquisition of resources.
New opportunities such as new organizational structure/forms, new processes and
distinct product/services, which are generally the result of externally driven
opportunistic entrepreneurial activities, are integrated. The model doesn’t distinguish
between opportunities and success factors emerging from inside the organization from
those emerging from outside. By merging entrepreneurial activities with marketing,
the model assigns a more strategic, proactive and opportunistic role to marketing as
compared to its traditional role, which was largely tactical and reactive.
Entrepreneurial marketing expects marketing to get involved with not only provision
of informational resources acquired through marketing research, but also assist in
exploiting resources in ways such as tapping required human skills, and acquiring
financial resources such as venture capital or bank loans.
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In general corporate marketing planning leading to identification of opportunities and
success factors would involve a broad assessment of the environmental threats and
opportunities, corporate strengths and weaknesses, its core competencies, its current
product portfolio and its long term objectives (Guiltinan et. al: 1997). Further in
deciding whether it should continue with its current products as they are, redevelop
them, or expand in different markets it would need an in-depth situation analysis of its
current offerings and markets. This model posits that this analysis need not be limited
to in depth understanding of current products and markets and may include closer
review of current processes and structures used for serving the markets. In addition,
this model incorporates pursuit of novel sources of customer value through
identification and development of different processes, structures and entirely new
products and markets.
The strategic focus awarded to the planning framework provides a general format for
acquisition and allocation of resources and budgets. Product objectives and strategies
and allocation of resources need to be determined on the basis competitive strength
that the organisation can wield in the market and on the attractiveness of the market as
shown by profitability in the market and opportunities for growth.
Similarly the type and extent of resources that will be acquired will be determined by
the strategic focus, the capacity to take risks, the potential for success and the
strengths and weaknesses of the organisation.
In large organisations, implementation and management is often in the hands of the
middle management as also completion of detailed situation analysis (Guiltinan et al:
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1997). By performing a situation analysis managers are able to identify major
problems and opportunities in the microenvironment of the product, which feeds into
marketing planning at the corporate level and guides the selection of marketing
strategies and programmes for individual products and markets at the middle
management level. In addition once the decision to continue with any product or
market is taken at the higher levels the implementation and management of the
resources, dedicated to the product and the market, is often left to the middle
management. The proposed model (fig. 2) presented here however, doesn’t
distinguish between middle management activity and corporate level activity and
leaves it open to be applicable to any size of an organisation.
As mentioned earlier this proposed model aids in the identification and sustainability
of the portfolio of ventures. Harvesting and adding to mainstream and consolidation
of product /market mix and other resources is built into the model. In general,
consolidation is essential. Organisations are faced with many markets, customers,
product and all other developmental options. Organisations cannot pursue all possible
markets and all attractive product options because human and especially financial
resources are limited, even if marketing assists in sourcing them.
This model also assumes that the ability to identify and proactively act on
opportunities for innovation and new ventures is contingent on a number of factors
such as - extent of entrepreneurial bent of the organisation, tolerance for failure, status
of marketing within the organisation, and cross-functional co-operation.
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Overall, the model includes planned innovation of new products, creation of new
markets and development of new structures and processes, which will lead to
enhanced customer value. This departs from restricting activity to better serving
existing markets through incremental improvements, which have been the mainstay of
traditional marketing.
References
Abratt, R., Beffon, M., Ford, J. 1994. Relationship between marketing planning and
annual budgeting. Marketing Intelligence and Planning, 12, 1, 22-28.
Bolton, B., Thompson, J. 2003. The Entrepreneur in Focus, Thomson: London.
Brooksbank, R. 1996. The BASIC marketing planning process: a practical framework
for the smaller business. Marketing Intelligence and Planning, 14, 4, 16-23.
Bygrave, W.D., Reynolds, P.D., Autio, E. 2004. Global Entrepreneurship Monitor,
2003 Executive Report, Babson College: London.
Chaston, I. 2000. Entrepreneurial Marketing: Competing by Challenging Convention,
Macmillan: United Kingdom.
Gartner, W.B. 2001. Who is an Entrepreneur, is the Wrong Question. American
Journal of Small Business.
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Guiltinan, J.P., Paul, G.W., Madden, T.J. 1997 Marketing Management –Strategies
and Programmes, 6th Edition. McGraw Hill: United States of America
Kotler, P. 2000. Marketing Management, The Millennium Edition, Prentice Hall:
New Jersey.
Halloran, J.W. 1994. Entrepreneurship, Mcgraw-Hill: New York
Kao, R.W.Y 1993. Entrepreneurship. Journal of Creativity and Innovation, 1(3), 6971.
Kotler, P. 2000. Marketing Management, The Millennium Edition, Prentice Hall:
New Jersey.
Kuratko, D.F., Hodgetts, R, M. 2004. Entrepreneurship, Theory, Process, Practice,
6th Edition, Thomson/South-Western: London.
Morris, M.H., Kuratko, D.F., Schindehutte, M. 2001. Towards integration:
understanding entrepreneurship through frameworks. Entrepreneurship and
Innovation, February.
Merriam-Webster. 1999. Collegiate Dictionary, 10 ed, Merriam-Webster
Incorporated, Boston, MA.
NZABE, 2007
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Schindehutte, M.,Morris, M H., Kuratko, D. F. 2000. Triggering events, corporate
entrepreneurship and the marketing function, Journal of Marketing Theory &
Practice, 8 (2), p18-30.
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Situation analysis of current
products and Structures
/processes
Buyer behaviour &segments
Market size and growth
Product profitability
Sales and productivity of
marketing expenses.
Productivity of supporting str.
and processes
Establish market
opportunity
Identify market
success factors
New products
New services
New markets
New org. structures
New process needs
New sales and
distribution channels
Consolidate current
product/market mix &
resources
Analyse
Macro environmental problems and
opportunities
Organisational resources and
competencies
Long term mission and objectives
Product portfolio
Establish corporate objs. and strategy 
Markets to serve, Products to offer

Structures/processes to develop
Establish resources required – Expertise,
finance, channels, supply sources, legal
protections, production facilities
Analyse and
Conceptualise
Strategise and
acquire resources
Acquire resources
Allocate resources between markets/
products and processes/structures
Develop strategies and programmes for
products/market; Develop processes/Str.
Implement and manage –
Product, price, sales &distribution, and
promotion programmes; processes/Str
Resource – reinvestment, payback,
expansion
Harvest and add to mainstream
Fig. 2 - Entrepreneurial Framework for Marketing Planning
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Implement and
control