Industrial Marketing

Chapter 17 : Performance Measurement and Control

+The Control Process

+Types of Control

+Tools for Marketing Control

+The Balanced Scorecard

Chapter Summary

This chapter is devoted to the control function in marketing activities of the industrial marketer. The chapter starts with the two approaches of control – feedback control and feedforward control. The feedback control process starts with the development of performance standards and tracking systems.

Using this, the actual performance is measured with that of the targeted performance or the performance standards. This comparison brings out the deviations, if any, from the targeted performance. Then a diagnosis is done on the deviations and corrective action taken. Feedforward control on the other hand is preventive in nature.

The chapter next focuses on the four different types of controls, and then shifts over to describe the various tools of marketing control – marketing audit, budget, sales analysis, and the marketing decision support system (MDSS). Marketing audit is strategic in nature, budgets and sales analysis deal with the quantitative part of the planning and control, MDSS deals with the scenario analysis, sensitivity analysis, and environmental monitoring related to marketing activities.

Finally, the chapter describes the Balanced Scorecard that has become an important evaluation and control tool for organizations across industries. It is a comprehensive control mechanism developed by Kaplan and Norton, which not only focuses on the financial perspective, but also on the customer perspective, internal business process perspective, and innovation and learning perspective. Thus the balanced scorecard is an integrated performance management system that guards against sub-optimization.

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