2.2 Internal marketing cycle

Now that you have looked at the main elements of internal marketing and developed a plan for your organisation, how might this be implemented so as to achieve the goals and objectives? In other words, what process could be adopted? Very few studies provide guidance on the implementation process; one exception is Ballantyne (2003), who describes a four-stage process or internal marketing cycle (see Figure 11 below).

Figure 11 Internal marketing cycle

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A continuing sequence of tasks – “energising”, “diffusing”, “code breaking”, and “authorising” in a circular flow.

Figure 11 Internal marketing cycle

As you can see, the main inputs into the process relate to the knowledge of participants and market intelligence, emphasising the information gathering and research element of internal marketing. The outputs or objectives emphasise improvements in relationships and a focus on external customers leading to improvements in market performance (attracting and retaining customers). The four-stages of internal marketing are:

Energising – learning how to work together on useful market place goals that are broader than the bounds of any individual job description.

Code breaking – learning how to apply personal resources of ‘know-how’ in working together to solve customer problems, create new opportunities and change internal procedures.

Authorising – learning to make choices between options on a cost-benefit basis and gaining approval from the appropriate line authority.

Diffusing – learning how to circulate and share new knowledge across managerial domains in new ways.

Activity 7 Internal marketing process and criticisms

Timing: Allow around 60 minutes for this activity

You have now learned four main implementation stages of internal marketing. At each stage, implementers may encounter challenges such as resistance to the changes from managers and employees.

Part A

Below are the four types of practices that were implemented in a large Australian retail bank.

Can you drag each practice into the corresponding ‘Stage’ slot in the table below?

Three-day workshops for around 20 staff volunteers who worked on intractable service quality puzzles derived from formal market research inputs. Requires employee commitment.

ENERGISING

Creative puzzle-solving task work organised around small teams. Access to specialist ‘expert’ departments was available to participants during this phase.

CODE BREAKING

Proposals and recommendations were prepared for the decision-makers in various departments and decisions carefully negotiated.

AUTHORISING

New knowledge became new policies and procedures and training schedules prepared by the line management departments responsible with inputs from internal marketing groups.

DIFFUSING

Using the following two lists, match each numbered item with the correct letter.

1. Three-day workshops for around 20 staff volunteers who worked on intractable service quality puzzles derived from formal market research inputs. Requires employee commitment.

2. Creative puzzle-solving task work organised around small teams. Access to specialist ‘expert’ departments was available to participants during this phase.

3. Proposals and recommendations were prepared for the decision-makers in various departments and decisions carefully negotiated.

4. New knowledge became new policies and procedures and training schedules prepared by the line management departments responsible with inputs from internal marketing groups.

• a.ENERGISING

• b.AUTHORISING

• c.CODE BREAKING

• d.DIFFUSING

The correct answers are:

• 1 = a
• 2 = c
• 3 = b
• 4 = d

Part B

As you have learned about internal marketing, you may have started to question:

1. Is internal marketing a marketing activity or human resource management activity?
2. Does internal marketing attempt to manipulate employees?

Figure 12

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A manager is playing a chess game with the chess pieces as her employees.

Figure 12

Reflect on your thoughts about these questions in the box below.

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Feedback

According to the perspective taken in this session, internal marketing is an integrative concept involving a number of traditional management functions such as marketing and human resource management. Some will argue that the elements of an internal marketing approach are the province of human resource management and that marketers should not interfere in employee relations. This view does, however, fail to recognise the positive contribution which an internal marketing approach can bring, where the emphasis is on inter-functional co-operation rather than a usurping of human resource management’s role.

As with many employee-oriented initiatives, proponents of internal marketing have been accused by some scholars as attempting to manipulate employees. Much internal marketing will depend on the prevailing culture within an organisation, and its success is directly attributable to the individuals involved and the ability of managers to inspire trust and commitment.

Generally, internal marketing is not a discrete activity, and formalising it may undermine its effectiveness. Typically, organisations prepare formal programmes, which are accompanied by a range of ad hoc initiatives. Internal marketing is more likely to be successful with a subtle approach that will lead to the development of ‘shared vision’ (within the organisation). Large organisations frequently spend vast sums of money on launching schemes to improve internal relationships, only for the programme to ‘fizzle out’ because of a lack of commitment throughout the organisation and employees failing to identify with the scheme.