The present article aims to analyze the theoretical bases of the design of methods, procedures and tools for the analysis of the factors present in the organizational environment and the internal organizational situation as part of the process of identifying and evaluating market opportunities.
The starting point is the analysis of the concept of marketing as a philosophy of organizational action and, therefore, as a support for all its strategic design. Subsequently, the interrelation between organizational strategy and the search for and evaluation of market opportunities is analyzed to finally raise the possibility of relating the latter to the SWOT analysis, a question not explicitly reflected in the literature consulted by the authors.
Keywords:
Organizational strategy, marketing, market opportunities.
Introduction:
In modern times, successful companies are those that have managed to leave behind the mentality of producers of tangibles or intangibles and adopted the philosophy of satisfying the needs and desires of potential consumers, a philosophy that is not necessarily opposed to the construction of a socialist society fair and equitable and that, therefore, can be taken as a starting point for the improvement of the productive and commercial activity of organizations.
Adopting the philosophy of satisfying needs and desires, or simply the marketing philosophy, is impossible without a conscious, rational and organized process that leads to the strategic organizational design sustained in the knowledge of the target market and that takes as a starting point the identification and evaluation of the market opportunities present in it.
At the same time, the identification and evaluation of market opportunities require methods, procedures and tools that allow the analysis of the factors present in the organizational environment and the actors that interact in its target market (to detect favorable and unfavorable situations to the commercialization of the producers) and the internal organizational situation (to identify the "know-hows" that allow their adaptability to the existing conditions in the environment.
Analyzing the theoretical bases of the design of methods, procedures and tools that for the analysis of the factors present in the organizational environment and the internal organizational situation as part of the process of identification and evaluation of market opportunities constitutes the objective of this article.
Marketing and strategic planning.
The concept of marketing, throughout history, has had different interpretations and at times it was not well understood by different socio-cultural groups as it was seen only as a new mechanism for increasing the profit of organizations through product sales.
There is no concept in the Spanish-speaking world that fully reflects the meaning of the word marketing in business management. That is why the Royal Academy of the Spanish Language Spanishized it as "marketing" although it is common in Spain and Latin America to use Anglicism and refer to this concept as it is written in English.
In a primary definition, authors such as Stanton (1970), considered that it is a total system of business activities in intimate interaction, aimed at planning, setting prices, promoting and distributing products and services that satisfy the needs of current and potential customers.
This concept has evolved over time. Various authors, such as Kotler (1980), delve deeper into what marketing is, reaching the conclusion that they study how transactions are created, stimulated, facilitated and valued. At first, they focus on the concept of transaction without considering the objective pursued by the parties involved in it and make a description of the process through the classic variables: product (created), promotion (stimulated), distribution (provided) and price (valued). Then they go on to clarify the concept more until they define that marketing is, as Kotler himself points out (1993),human activity aimed at satisfying needs and desires through a process of exchange and considers it as “… a social and management process through which different groups and individuals obtain what they need and want, creating, offering and exchanging products with value for others ".
From the analysis of the approaches of the aforementioned authors, it is clear that marketing is much more than the simple activity of the company in the market (marketing), more than the application of market techniques (marketing) and goes beyond the problems of the realization of production (marketing). In addition to encompassing all the above concepts, it includes research and development activities, monitoring the market and its environment, they are the principles and concepts that govern all the performance of modern organizations.
The key for organizations is to find the needs, wants and demands of their target market. Needs are the basic requirements of a human being, we all need to feed ourselves to survive, in the same way that air, water, clothing or a safe place to shelter is needed. In the same way, they have other needs such as entertainment, improvement or leisure.
Knowing how to understand the needs and desires of customers is an effort that organizations face every day. Not always the consumer has absolute clarity of the expectations that he has of the product or of the real needs that he has and sometimes it is necessary to know how to interpret his words.
When Kotler (1993) illustrates the interaction between needs and desires in his work, he does so from the perspective that there are essentially five needs that can be distinguished in the following way.
- Declared needs (the customer wants the cheapest product).Real needs (the customer wants a product whose operating cost, not the purchase price, is reduced).Unstated needs (the customer expects good service from the seller). Needs for delight (the customer would like the seller to include something that would make the product he wants to buy more attractive) Secret needs (the customer wants his friends to see him as a smart shopper) Not only in the needs declared by the client since this could not be completely satisfied, it is for that reason that an important group of organizations have changed their philosophy of "manufacture and sell" to that of "detect and respond".
Marketing influences demand, identifies and develops demand, enabling consumers' wishes to become reality. It also contributes to orienting those desires and channeling them towards effective demands based on a given purchasing power. Organizations must measure not only how many people want their products but also how many can potentially acquire it, the latter becoming the effective demand that maintains the business with vitality and which is expected to increase.
- What the customer wants When they want it Where they want it How they want to buy it Who really wants to buy it How much they want to buy and how much they are willing to pay for it Why they want to buy it
It is interesting to create products for the satisfaction of all the needs and desires of the customers, whether material or spiritual. These products constitute a cost for the organization but have a tangible or intangible value for the consumer. The cost incurred is recovered and allows the obtaining of profits when the merchandise is made. If the customer was satisfied, they will buy the product again and this will guarantee the reproduction of the production cycle.
Throughout the process described, the organization has to take into account that it is part of the social environment where it lives, therefore it cannot produce with its back to the market, otherwise its products would stagnate; that it depends on suppliers who guarantee its raw materials to produce the final product and that this is linked to certain monetary and commercial exchange relations with other organizations that together integrate a process of sale in the market and that it is in the latter where commercial transactions appear that involve short and long-term decisions by organizations in search of efficiency and saving the scarce resources that exist.Hence the need to work with marketing strategies aimed at meeting the needs of customers to ensure the prestige and positioning of the organization in the market, consumer loyalty to the product and future sales.
Market opportunities as alternatives for making strategic decisions in organizations.
To undertake the search for market opportunities, it is first necessary to understand what is called a market, the role that organizations play in it and that they must guarantee an advantageous space in it.
The market is the social (or virtual) environment that favors the conditions for exchange and, therefore, must be interpreted as the institution or social organization through which the suppliers (producers, sellers) and demanders (consumers or buyers) of a certain type of good or service, enter into a close commercial relationship in order to carry out abundant commercial transactions.
It is extremely complex that the entire market can be covered with a specific product, tastes are varied and depends on the idiosyncrasy, age groups and personal characteristics of individuals. This explains why specialists divide the market into segments and identify and separate the different groups of buyers who share specific perceptions of the product or service using demographic, psychographic and behavioral variables of the buyers.
Once the market is segmented, organizations can evaluate the attractiveness of each one of them and decide which segments to serve, which are their target markets. For each target market, the organization develops a market offer that begins to position itself in the minds of target buyers based on certain advantages perceived in the product or service.
The decisions that give rise to the selection of target markets and the positioning of products and services are strategic, for the medium and long term, but not imperishable in time. Providing the necessary stability and continuity in organizational functioning requires keeping in mind that markets are dynamic and that the needs of customers, competitors and the environment are continually changing and, therefore, identifying the opportunities offered by the market constitutes a moment important in the frameworks of the strategic design of organizations, from the moment in which the decisions that respond to the vision and objectives are made and the way to achieve the proposed goals is decided.
For Kotler (1993) the market opportunity is “… an attractive field for the company's marketing action, in which it will enjoy a competitive advantage”. This author also, in the 2006 edition, defines them as "… a specific market in which the company could develop marketing actions while enjoying a competitive advantage". These definitions are very similar and convey the same message, the difference between one and the other is the change from the "attractive field" which is a broader concept for the "specific market" concept that better guides companies by knowing "where Marketing strategies must be targeted.
The author of this research assumes the concept previously raised and, at the same time, shares with Garciandía (2013) that “… the concept of market opportunities is not always used explicitly by management specialists when explaining or implementing management processes. strategic design but is always implicitly present in such analyzes. Not a few authors identify market opportunities with favorable indicators of the variables to be considered in the analysis of the environment since they characterize the actions of forces and actors in the environment. These variables can influence organizational action but do not define it and this can lead to the fact that, in economic practice,Organizational strategies may be more focused on "what to do" to achieve the objectives than on "how to get there" to achieve them, which leads to the loss of one of the levels of disaggregation of the strategic design since the objectives are defined in terms of market opportunities, strategies in terms of objectives and strategic actions in terms of strategies ”.
Later, said author points out that an opportunity in the environment can be considered as an event, event or need derived from the environment, in which there is a high probability that an organization through specific actions can take advantage of and satisfy it, these can be detected performing an external diagnosis. However, market opportunities can be interpreted as strategic alternatives that are presented to the organization to take advantage of opportunities and mitigate threats from the environment based on the strengths and weaknesses derived from its know-how.
Assuming the aforementioned criteria implies recognizing the existence of three main sources of market opportunities. The first is to offer something that is not abundant. This requires little marketing work, since the need is clear. The second is to offer an existing product or service in a new or superior way. There are several ways to discover potential improvements for products or services: asking customers for suggestions (problem detection method), asking customers to imagine an ideal version of the product or service (ideal method), and asking customers to sketch the phases of acquisition, use and abandonment of a product (method of the chain of consumption). This third source usually leads to an entirely new product or service.
Reaching the above conclusion implies recognizing that the identification of market opportunities is related to and derives from the strategic diagnosis of the organizations that, constituting an "x-ray" of the current moment of the organization, allows identifying the possibilities and challenges that the organization faces (opportunities and threats) and characterize the organization's "know-how", which enables the identification of organizational potentialities for change, taking advantage of opportunities and counteracting existing threats in its environment.
The external diagnosis is key to reaching the strategic process, it complements the internal analysis giving it a greater vision, since it goes beyond studying the changes in the tastes and habits of the consumer or technology, understanding that the organization must also respond to the changes in social and cultural values, its political environment and the growth trends of the economy. There are multiple authors who relate the macro environment or general environment and the micro environment or competitive environment.
The macroenvironment is the set of economic, political, social, educational, cultural, demographic, legal, ecological and technological factors that influence or may influence the organization.
These factors are composed in their study of variables, conditions and situations that when analyzed, allow us to get to know their way of operating and their behavior. It is also important to find a way to qualitatively and quantitatively measure the effects of the variables identified in each factor on the organization to define what influence it will present from a positive or negative point of view on the entity's behavior, analyze the impact of the influence to be able to make forecasts about the implications it will have on the development of the organization. If the acting forces are not correctly disaggregated into variables, the possibilities of the organization to find adaptive responses to changes in the environment would be limited and thus we would miss possible market opportunities.Bearing in mind the economic factors that reflect the phenomena related to the circulation, production and consumption of merchandise in society, which is measured in all countries and is expressed in parameters such as: gross domestic product (GDP), National income, unemployment, money supply and international reserves, among others, are of great importance in the life of the entire organization, since they define the possibility and conditions of obtaining the monetary or material resources for its operation and development.The monetary mass and the international reserves, among others, are of great importance in the life of the entire organization, since they define the possibility and conditions of obtaining the monetary or material resources for its operation and development.The monetary mass and the international reserves, among others, are of great importance in the life of the entire organization, since they define the possibility and conditions of obtaining the monetary or material resources for its operation and development.
Another factor that cannot be lost sight of are the political ones, which refer to the situations that characterize the country's political climate, its stability, attitudes towards the industry and the product, government projection on the role of control over the economic sectors of the nation, union activity and other social organizations.
The social factors take into account the composition of the population, specifying in which the organization directly serves, the current employment situation, its trend over time, the occupation of the population and its development perspective, government policies in everything related to education, health, income, security, and housing, among others.
When talking about educational factors, what refers to the level of schooling, degree of specialization, number of average professionals in the environment, the conditions to improve people's improvement, varying needs and desires according to the educational level, are taken into account. of the population.
Cultural factors in not a few cases can define that a project that apparently can be successful fails because the values and behavior of the people around the organization are not understood, appreciated and analyzed correctly, whether we talk about suppliers, neighbors, clients, users or workers. Characterizing the culture that makes up a certain population with its beliefs, preferences, tastes and values, as well as the traditions and cultural expressions that individuals adopt and present in the face of the consumption or use of services offered by the organization in its different market segments has been a fundamental aspect to take into account.
The demographic factors take into account the birth and mortality rate, the population growth rate, the behavior of migration, the composition of the population by age group, sex, demographic location and occupation, the economically active employed and unemployed population., and any other useful element to analyze the nature of the human resources available to society and especially the population served by the organization.
From all these aspects, it is necessary to select which ones influence the organization either positively or negatively depending on its corporate purpose.In the case of organizations that market jam products, the analysis must be focused on the growth and geographic mobility of the population since demand is estimated and production is planned according to the population density of a region.
Legal factors are important to bear in mind because state regulations on organizations are derived from them in order to ensure coherence between the country's socioeconomic model and the entities. The law is a key element for the functioning of organizations both in their internal functioning and in their external relations. Regulations can be criminal, labor, civil, fiscal or commercial, the latter having the greatest impact on food producer-marketing organizations.
Ecological factors are related to the description of the geographical and topographic characteristics of the areas where the organization is located, the availability of natural resources available, the knowledge of the environmental impact generated by the organization in its operation and the identification of Aspects, criteria and situations that must be taken into account in the strategic process since they can be stimuli or limitations for the development of the activities of the organization as a result of environmental regulations.
From the technological factors, the number of producers and transmitters of innovation in production processes, products and administrative systems, in communication and information systems, as well as the level of scientific and technical advancement in society, must be taken into account. Including the physical base and the technology knowledge base. The tendency is to strive to have the most advanced technology at the international market level, surpassing that used by the competition, or to increase the level of technological development achieved in the area in which the organization operates related to its activity, always taking care not to fall into it. This is known as the "technological syndrome" which is nothing more than trying to change the entire production base in a situation in which the changes must be due to the accumulation of small innovations.
For the analysis of strengths to be as effective as possible, managers must see them as a system where strengths interrelate and respond to each new challenge. If we see how the world population has been growing in recent decades (demographic factor), which has led to an increase in the consumption of goods and an increase in pollution (environment), which has led governments to adopt new laws to protect ecosystems (political-legal), this has forced the search for new technological solutions and new products (technology) that, in some cases are variables (economic forces) that can change attitudes and behavior (socio-cultural) is exemplified clearly as a reality impacts and in different factors that have to harmonize with each other.
In the performance of each of the businesses that an organization has, there are particularities related to the actors of the microenvironment or competitive environment that structurally determine its performance, taking into account the good or service it offers and the market to which it is directed. These actors, according to the studies of Porter (1985), are suppliers, existing or current competitors, potential competitors, customers and substitute products.
Provider is understood to be any entity that makes a specific service or product available to another entity. According to this concept, the supplier can be the producer of goods and services or their distributors. (Nunes, 2012)
Suppliers according to their size and importance can be a determining force for the entity. Having many times influence on the positioning of an organization in the market since they guarantee the necessary inputs for production or services.
The supplier - organization relationship is decisive in its offer, sometimes becoming a competitive advantage. The quality and final price of the product and even its potential offer to the target market may depend on this relationship.
When it comes to competition, it is determined by the different business units that operate in a common market. Two or more organizations are considered competitors when they manufacture goods, market products or provide similar services in the same market.
Competition must be viewed from two sides, the first is price sensitivity where product differentiation, total purchases, the impact of product quality, and buyers' profits are taken into account. The second is linked to the bargaining power of buyers, the importance of the volume of purchases, the costs of a change in customer and the information of buyers about their purchasing preferences.
Similarly, there are potential competitors, new organizations with the capacity to enter the sector or already established organizations with the capacity to considerably increase the pressure in the same market. The access of new competitors to the market will be conditioned by the type and level of barriers they have for their entry. These barriers can be strong or weak and can be established by market conditions, the behavior of existing organizations, the way in which the analyzed good or service is produced and the barriers imposed by governments that, depending on their degree and nature, may mean or not a threat to the organization.
Clients can be current or potential and are defined in their most general conception as individuals or entities that acquire goods or services either for personal consumption, for industrial or social purposes. It plays one of the fundamental roles in the performance of organizations since they have needs and desire that they seek to satisfy. The path to customer satisfaction is a driving force for purchases, giving opportunities to organizations that provide the product or service that the customer needs and wants.
Potential customers are all those organizations, organizations or people who, although they are not currently making purchases from the organization, are viewed as potential customers in the future as they have purchasing power, authority and the necessary willingness to buy. This type of client can be considered as a source of future income depending on the volume of sales to which it could result. With them you can visualize the work in the short, medium or long term.
In the search for this type of customer, all the possible consumers of the product must be evaluated according to the attributes they possess, which part of these consumers have already been captured by the organization, which factors influence their purchasing decisions, when and when when they buy and what attributes they expect to find in the products they buy.
Current customers are those organizations or individuals who make purchases from the organization on a regular basis or who made purchases at a recent date. This type of client is the current source of income that the organization receives in accordance with the sales volumes they generate and they are what allow the organization to have a certain share in the market.
Substitute products are those goods or services that can at any given time fulfill a similar function to that of the product or service being studied. It should be taken into account how easy it is for the customer to replace one type of product with another similar one.
The substitutes constitute a threat since they are an alternative for the buyer, being able to exceed the offer in prices of the product under study. Depending on the degree of differentiation of the existing products on the market, the pressure they may exert will be greater or lesser.
In defining marketing strategies, one of the main roles is played by external diagnosis. This diagnosis alone does not establish the long-term course of action of the organization, said course of action will be determined by the “know-how” of the organization, finding the strengths that would allow taking advantage of the opportunities offered by the environment. Minimizing threats from the surrounding environment and weaknesses that prevent taking advantage of strengths and maximizing opportunities.
There is a big difference between identifying attractive opportunities offered by the medium and having the necessary skills to successfully exploit those opportunities.
Periodically businesses have to evaluate their strengths and vulnerabilities and this is achieved through an internal diagnosis.
The internal diagnosis is focused on evaluating the potential of the entity, in such a way that it allows to identify strengths and weaknesses. Strength is understood to be that characteristic or positive values that organizations have that can be associated with their inputs, processes or results that can be used to protect themselves from threats and take advantage of opportunities, in order to be useful, it must be compared with possible competitors. Weaknesses show failures that must be corrected through appropriate strategies. (Kotler, 2006)
It is important to analyze the variables that influence the main areas of the organization. Marketing is influenced by the breadth of distribution, the level of product acceptance, sales system and link with customers, the estimated demand or available market size, the degree of customer satisfaction and the quality-price ratio with respect to similar products competing in the market.
When analyzing the variables in the production area, production capacity, access to raw material sources, production organization, quality control systems and production costs are usually taken into account.
In the area of finance, the main variables taken into account are the availability of capital, efficiency in managing costs, profitability and financial stability. In human resources, the need for workforce, qualification and experience of employees, level of staff satisfaction, and managerial staff preparation are taken into account.
In the area of management and organization, the degree of centralization of the organization, the form of management, the organizational climate, the leadership style, the planning system and its control are taken into account.
In the logistics area, the storage conditions, patents, licenses and contracts for own or third-party assistance, transport and the organization's level of dependence on suppliers are taken into account. Storage capacity and inventory control.
So far, three fundamental moments have been seen for the search for market opportunities: the analysis of the macro and micro environment from which opportunities and threats are obtained, and the internal diagnosis where the strengths and weaknesses are defined in the organization.
With these elements we have the strategic diagnosis that gives rise to the balance of the strategic resources of the organization, which in some literature is known as the SWOT or SWOT matrix and is commonly called SWOT analysis, a matrix tool that links opportunity, threat, strength and weaknesses.
This tool allows evaluating the organization's situation by linking internal negative and positive aspects with external risks and possibilities that the organization must face in the short, medium and long term.
For a practical application in the strategic decision process of all the opportunities and threats identified, a selection of the most important must be made. Otherwise, it would be practically impossible to reach satisfactory results due to how complex the SWOT analysis would become. That is why the literature recommends the reduction of the list before the process of making the matrix and various techniques are suggested to carry out said reduction.
The balance of the strategic resources of the organization allows to specify the forces with the greatest impact identified as possible factors of success or failure and to orient oneself as to the most convenient strategy to follow according to the reality that the organization is experiencing (offensive, defensive or specialization) so that they can take advantage of the conjunctures of the environment in accordance with their know-how and in accordance with this, identify possible market opportunities.
In general, the literature does not relate market opportunities to SWOT analysis, nor are opportunities identified from it. At the author's discretion, the possibility of taking advantage of a technique that allows greater objectivity in the identification of possible courses of action that facilitates the organization's decision-making process is allowed to escape, linking it to its strategic objectives and, as Kotler (1993 points out)), to classify market opportunities according to their level of attraction and the probability of success that the organization would have with each of them to facilitate the decision-making process.
For an organization's likelihood of success in a specific market to be increased, its business strengths and distinctive competencies have to be matched, and these must exceed those of its competitors.
Conclusions.
In the literature on business administration, different methods, procedures and tools for the search for market opportunities are explained but there are few attempts to link them with the analysis of the internal and external environment of the organizations, which causes the validation of said theoretical foundations not always lead to expected results. In the best of cases, within the frameworks of strategic design, the organization seeks alternatives for strategic decisions through consensus among the members of the management teams, or work teams designated for this purpose, based on the experience and knowledge of the participants. In the worst case, they are taken without analyzing different courses of action or the external and internal conditions in which the organization works.
Faced with these realities, it is necessary to design methods, procedures and tools for the search for market opportunities as a process inserted in the organizational strategic design itself that is nourished by the results of the analysis of the external and internal environment of it, allows the finding and evaluation of viable alternatives or courses of action from the point of their attractiveness and probability of success and the decision of which of them to assume as strategies aimed at improving organizational positioning and performance in their target markets.
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Matrix of Operational Strengths and Weaknesses
