An executive summary for
managers and executive
readers can be found at the
end of this article
Fitting the needs of target
consumers
402 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999, pp. 402-414, # MCB UNIVERSITY PRESS, 1061-0421
An empirical study which
compares the organisational
structures of companies
managing the World's Top 100
brands with those managing
Outsider brands
Philippa Hankinson
Senior Lecturer, Roehampton Institute London, An Institute of the
University of Surrey, London, UK
Keywords Brands, Product management, Organizational structure, Postmodernism,
Marketing management
Abstract Contains the results of a quantitative research study which compared the
organisational structures of the World's Top 100 brand companies with those of less
successful companies, referred to in this article as Outsider brand companies. Identifies
that whilst the type of organisational structure may not be seen as a determinant of brand
success, perceptions of whether the organisational structure was right for them, were. In
other words, managers of brands need to feel that the organisational structure allows
them to manage in the way they consider necessary to deliver brand success. In some
instances this might mean an authoritarian style of management through a hierarchical
organisational structure and in others, it might mean a more democratic style of
management through relatively flat organisational structures. The results are discussed in
the context of brand management theory and practice and the postmodern paradigm shift
regarding organisational structure.
Introduction
To be successful in today's turbulent business environment, brand companies
need to adopt the kind of organisational structure that allows them to deliver
successful brands. Critics (Berquist, 1993; Morton, 1995; Ezzamel et al.,
1996) suggest that traditional hierarchical structures may be unnecessarily
restrictive and prevent companies responding fast and effectively to shifting
consumer preferences. On the other hand, flatter structures, which organise
around work processes rather than functions, may be in a better position to
understand consumer needs and be able to develop appropriate brand
propositions which ``fit'' the needs of target consumers. Yet, there is little
empirical evidence to identify what kind of organisational structure enables
brand companies to deliver brands successfully. This article aims to address
this issue by comparing the organisational structures of successful brand
companies (those managing the World's Top 100 brands[1]) with the
organisational structures of less successful brand companies (those managing
Outsider brands[2]).
Organisational structure
Organisational structure is the framework within which brands are
managed successfully or otherwise. Traditionally, brand managers have
been hierarchically organised, ever since Procter & Gamble first
introduced the brand management system in 1931 (Low and Fullerton,
1994). Here, the brand manager occupies a relatively junior, first level
The current issue and full text archive of this journal is available at
http://www.emerald-library.com

Fewer management levels
To deliver brands
successfully
JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999
position, may be responsible for one or two brands and reports to the
marketing manager. The marketing manager may be responsible for
several brands (the accumulation of all the brands managed by the brand
managers she or he oversees), reports to the Group Marketing Manager
who in turn reports to the Marketing Director. This type of structure relies
on vertical linkages to coordinate activities between the bottom and top
layers of the company. Nevertheless, such a structure may be
characterised by a limited sphere of responsibility, a restricted
information flow and tight control from the top.
In contrast, other companies are shifting towards flatter, more horizontal
structures in the hope that this type of structure will enable them to respond
more effectively to the turbulent business environment in which they find
themselves (Peters, 1992; Muzyka et al., 1995; Daft, 1998). It means fewer
management levels and more brands being managed by relatively junior
brand managers. Indeed research suggests (Hankinson and Cowking, 1997)
that many brand managers (31 percent) manage three to five brands with a
further 15 percent managing six or more. Flatter structures involve a shift
from vertical decision making to horizontal collaboration and cross-
functional cooperation (Hedlund and Rolander, 1990; George et al., 1994;
McCalman, 1996). Managers learn to share information across the company
and to promote a culture of openess and trust (Hankinson and Hankinson,
1999). In theory at least, flatter organisational structures may be in a better
position to deliver successful brands.
A third type of structure, which first emerged in the 1970s and 1980s, is the
matrix structure. This structure is based on a dual chain of command which
aims to achieve an equal balance of power between the vertical and
horizontal linkages of the company. Along one axis, a company may be
organised according to functions (advertising, pack design, new product
development) or divisions (marketing, finance, information technology) and
along the other axis, the company may be organised according to different
brands, for example, Twix, Mars, Bounty. In such a structure both the brand
manager and the functional/divisional manager hold equal authority. A
matrix structure may be of particular benefit to global companies seeking to
achieve international collective responsibility (Hankinson and Hankinson,
1998).
Ultimately, of course, there may be no ideal structure for a company
(Mintzberg, 1979; Martinsons and Martinsons, 1994). Instead, brand
companies may need to develop the kind of structure that meets their
particular circumstances and thereby enables them to deliver brands
successfully.
Research
The research compared the organisational structures of companies managing
successful brands with companies managing less successful brands. For the
purposes of this research, a successful brand was defined as one within the
World's Top 100 brands (as defined by Interbrand, the worldwide brand
consultancy based in London, UK (see methodology and Appendix 1)). A
less successful brand was defined as one outside the World's Top 100 brands
and is referred to in this article as an Outsider brand.
The research proposition states:
Companies managing the World's Top 100 brands have different organisational
structures from those managing Outsider brands.
403
 The research explored three key areas:
(1) Current organisational structure.
(2) Attitudes to structural change.
(3) Perceived appropriateness of organisational structure to the successful
delivery of brands.

Methodology
The data were collected by means of postal questionnaires using three
mailouts, the first on 20 February, the second on 10 March and the third on
21 April 1998.
World's greatest brands The research sample comprised two subsamples; the first involved those
companies managing the World's Top 100 brands and the second, well-
known companies managing brands outside the Top 100. The first subsample
of the World's Top 100 brands comes from the Interbrand list of the World's
Greatest Brands. The list represents an industry standard which ranks brands
according to four key dimensions:
(1) brand weight (the influence or dominance the brand has over its category
or market);
(2) brand length (the stretch or extension the brand has achieved in the past
or is likely to achieve in the future);
(3) brand breadth (breadth of franchise the brand has achieved both in terms
of age spread, consumer types and international appeal); and
(4) brand depth (the degree of consumer commitment and loyalty the brand
has achieved) (see Appendix 2 for a more detailed description).
Brands are awarded scores according to these four dimensions by a team of
22 international brand consultants from Interbrand's international offices
around the world, including the USA, Europe and Asia. The scores are
aggregated to achieve a final score of Brand Power, which may be regarded
as a measure of each brand's strength and potential as a marketing and
financial asset (Kochan, 1997). Whilst this measure of success may have its
limitations, it nevertheless provides a means of identifying a group of leading
brands which may be considered successful relative to those outside this
ranking.
BRAD A+A The second subsample was drawn from BRAD A+A (Agencies and
Advertisers), a directory providing a list of UK agencies (advertising, sales
promotion and so on) and national advertisers (as extracted from the client
lists in the agencies section). BRAD A+A was chosen for the sampling frame
for the Outsider brands as its entries comprise well-known brands with
significant promotional budgets, which arguably have the potential for Top
100 status. The sample included brand companies such as Sodastream,
Cincinnati Milacron, Forbo-Nairn and Schwarzkopf and Henkel.
For the Top 100 subsample, questionnaires were sent to brand managers and
marketing managers/directors of every brand company in the Interbrand Top
100 list. For the Outsider subsample, a random start, constant interval
method of sampling was used across all entries in the national advertisers
section of BRAD A+A to produce a sample of 100 companies. When the
constant interval yielded a brand company already in the Top 100 subsample,
the next company in the directory was selected with the constant interval
being applied from that company onwards. As with the Top 100 sample,

404 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999


Differences in
organisational structures
JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999
questionnaires were sent to both the brand managers and marketing
managers/directors. In those cases where two completed questionnaires were
returned from the same company, only the first questionnaire to be received
was used in the research analysis. This prevented over-representation of
those companies with two brand management posts, as for instance in the
larger brand companies, relative to those with only one.
A total of 46 questionnaires representing the World's Top 100 brands was
analysed and a total of 52 Outsider brands. The response rate was, therefore,
49 percent of the 200 brand companies contacted.
Arguably, there may be differences in the organisational structures of
companies by market sector. In the consumer goods sector, for instance,
which contains many fast moving consumer goods (fmcg) brands, there may
exist more modern organisational structures such as the matrix or the
``relatively flat'', as it has been argued (see above) that more modern
structures may be better equipped to deal with a turbulent business
environment. Whereas in the consumer services and business to business
sectors, which contain more slow moving consumer goods (smcg) brands,
there may be more traditional, hierarchical structures.
Thus, initially for the purposes of the analysis, these industry groups were
combined into three market sectors, namely:
(1) Consumer goods ± drink, food, household appliances, over-the-counter
pharmaceuticals, motors, tobacco, toiletries and cosmetics, fashion
(2) Consumer services ± entertainment, financial, holidays, travel and
transport, household stores, retail and mail order
(3) Business to business ± publishing, institutional and industrial, agricul-
tural and horticultural.
However, since there were only three Top 100 brands in the business to
business sector, it was decided to drop this market sector from the analysis
and to focus the analysis on the consumer goods and consumer services
sectors (see Table I).
Survey results
Research proposition
Companies managing the World's Top 100 brands have different organisational
structures from those managing Outsider brands.
1. Type of organisational structure
Table II shows frequency data and levels of significance for Top 100 and
Outsider brand companies in terms of three broadly defined, organisational
structures: hierarchical, matrix and relatively flat for the total sample and by
market sector. The pattern of frequency distribution for the total sample
shows a higher proportion of relatively flat structures compared to
hierarchical or matrix for both Top 100 and Outsider brand companies.
Sample size of Sample size of
Market area Top 100 brands Outsider brands Total
Total 43 40 83
Consumer goods 37 27 64
Consumer services 6 13 19
Table I. Breakdown of sample by market sector
405
 Total Consumer goods Consumer services
N = 82 N = 64 N = 18
Top 100 Outsiders Top 100 Outsiders Top 100 Outsiders
percent percent percent percent percent percent
Hierarchical 33 40 27 41 80 39
Matrix 17 13 19 15 ± 8
Relatively flat 50 48 54 44 20 54
Sig. level 0.03 0.01 0.02 0.12 0.18* 0.11*
Note: * indicates Fisher's exact test

Table II. Organisational structure of Top 100 and Outsider companies

When the chi-square test of goodness-of-fit was applied, this frequency

distribution was found to be significant in both Top 100 and Outsider brand
companies. This confirms the views of several authors (Piercy and Cravens,
1994; Muzyika et al., 1995; Betts, 1996 amongst others) that hierarchical
structures are giving way to flatter structures in the postmodern business
environment. However, when the chi-square test of association for
independent samples was applied to determine statistical significance
between the two subsamples (Top 100 and Outsider brand companies), no
significant differences were found. This indicates that organisational
structure may not be seen as a determinant of brand success.
Chi-square test In the consumer goods sector, there were twice as many ``relatively flat''
organisational structures as hierarchical structures in Top 100 brand
companies and 19 percent which had matrix structures. Using the chi-square
test of goodness-of-fit, this was significant at the 0.02 level. Outsider
companies, however, showed a more equal distribution of organisational
structure with a similar proportion of companies with hierarchical structures
as with relatively flat structures (41 percent and 44 percent respectively).
Using the chi-square test of goodness-of-fit, no significant differences were
found between the different types of organisational structure for Outsider
brand companies. Nor was there a significant difference between the two
subsamples when the chi-square test of association was applied. Again, this
indicates that organisational structure may not be seen as a determinant of
brand success.
In the consumer services sector, the data suggest that there were some
interesting differences between the two subsamples with much stronger
representation of hierarchical structures amongst Top 100 brand companies
(80 percent) compared to Outsider brand companies (39 percent). This might
suggest that the greater complexity of brands in the consumer services sector
requires a stronger and more well defined line of command than can be
achieved in either flat or matrix structures which rely more on horizontal
communication and collaboration. It also confirms reservations by Galbraith
(1994) that flatter organisations may be no better at delivering success than
other structural forms. However, using the chi-square test of goodness-of-fit,
no significant differences were recorded for either subsample nor was there a
significant difference between the two subsamples, when the chi-square test
of association was applied. Nevertheless, it should be noted that small
sample sizes can create large sampling errors which can lead to non-
significant associations being recorded when there is a possibility that an
association does exist.

406 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999


No significant results were
achieved
2. Attitudes to organisational structure
Table III shows the mean scores for Likert agreement scales to statements in
which 4 indicated strong agreement and 1 indicated strong disagreement.
The Table shows widespread and almost equal measures of agreement in
both subsamples to the statements:
(1) over the last five years there has been a considerable shift from a
hierarchical organisational structure to a flatter structure; and
(2) to compete successfully, companies must be prepared to change their
organisational structure.
Using the t-test for independent means, no significant results were achieved.
Attitudinally, it would seem, brand managers in both Top 100 and Outsider
brand companies are equally convinced that change is a necessary
component of competitive success.

3. Appropriateness of organisational structure to successful brand delivery

Table IV shows frequency data and levels of significance for Top 100 and
Outsider brand companies on whether brand managers considered their
organisational structure appropriate to deliver successful brands. To test for
significant differences between the two subsamples, the chi-square test of
association was applied for independent samples, and in cases where cells in
the contingency tables had expected values of less than 5, Fisher's exact test
was applied.
The data show that in the consumer goods sector, 73 percent of Top 100
managers compared to 44 percent of managers of Outsider brands consider
their company has the right organisational structure to deliver successful
brands, a result which is significant at the 0.04 level of significance. This

Total Consumer goods Consumer services

N = 82 N = 64 N = 18
Top 100 Outsiders Top 100 Outsiders Top 100 Outsiders
Over the last five years
there has been a shift
from a hierarchical
organisational
structure to a
flatter structure 3.05 2.90 3.08 2.85 2.83 3.00
To compete
successfully, companies
must be prepared to
change their
organisational
structure 3.63 3.50 3.62 3.41 3.67 3.69

Table III. Mean scores to statements on organisational structure

Total Consumer goods Consumer services

N = 82 N = 64 N = 18
Top 100 Outsiders Top 100 Outsiders Top 100 Outsiders
No (%) 30 51 27 55 50 42
Yes (%) 70 49 73 44 50 58
Sig. level 0.05 0.04 1.00*
Note: * indicates Fisher's exact test

Table IV. Right organisational structure to deliver successful brands?

JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999 407

 suggests that what is important to brand success is not the type of
organisational structure per se but whether that organisational structure
works for them. In other words, brand managers need to feel that the
organisational structure allows them to manage in the way they consider
necessary to deliver brands successfully. In some companies this may mean
an authoritarian style of management through a hierarchical structure, in
others, it may mean a more democratic style of management through flatter
structures. Perhaps the fact that 89 percent of consumer goods brands in the
Top 100 are 25 years or more and several have dowager or even centenarian
status (Hankinson and Hankinson, 1999) suggests that Top 100 brand
companies have simply had longer to develop an organisational structure that
is appropriate to them; or that in those companies where organisational
change has taken place, towards flatter structures for instance, the
organisational change has had sufficient time to ``bed down''. Clearly,
organisational change can be a lengthy and difficult process with rather more
involved than simply re-defining job roles, work processes and the
composition of cross-functional teams. It requires an acceptance of a new
style of management with managers becoming more participative and
employees being willing to spend more time in meetings coordinating and
reaching consensual decisions. As a result, an adequate adjustment period is
required before structural change may be considered appropriate to the
delivery of successful brands.
Consumers are becoming In contrast to the consumer goods sector, not as many brand managers in
increasingly demanding consumer services considered their organisational structure helped them
manage successfully in either Top 100 or Outsider brand companies. This
may suggest some dissatisfaction with the predominantly hierarchical
structure of Top 100 brand companies. Arguably, consumers are becoming
increasingly demanding in the service sector, which traditionally has been
characterised by greater brand loyalty than in the consumer goods sector for
instance. Perhaps, Top 100 brand companies would benefit from re-assessing
their predominantly hierarchical structures with brand objectives that
prioritise fast and flexible service provision. The same may also apply to
Outsider brand companies with hierarchical structures. However, Outsider
brand companies, which have recently changed to relatively flat or matrix
structures, may require more time for the new structure to ``bed down'' and
its benefits to become apparent. Again, it is worth restating that an adequate
adjustment period may be required before brand managers perceive the new
structures as helping them to deliver successful brands.
The author suggests a particular sequence of steps to facilitate brand success.
First define the brand objectives, then determine the brand strategy to deliver
those objectives and finally, put in place an organisational structure which
allows both the implementation of the strategy and the realisation of the
brand objectives. This might be illustrated in the following way:
Brand objectives ? brand strategy ? organisational structure.

Conclusions
This study compared the organisational structures of companies managing
the World's Top 100 brands with those managing less successful brands
(referred to in this article as Outsider brands).
Twice as many Top 100 brand companies in the consumer goods sector had
``relatively flat'' organisational structures compared to hierarchical
structures, confirming the views of many authors that in today's postmodern
business environment, hierarchical structures are giving way to flatter

408 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999


Difference was statistically
significant
JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999
structures. This was not, however, reflected in the consumer services sector
where there were more hierarchically structured Top 100 brand companies
than either matrix or ``relatively flat''. This may reflect the fact that service
brands are often more complex in their product offering and have a greater
need for strong and clearly defined leadership.
Overall, however, there were no significant differences in the type of
organisational structure between the two subsamples (Top 100 and Outsider
brand companies), indicating that organisational structure may not be
considered a determinant of brand success.
Nevertheless, when managers of brands were asked whether they had the
right organisational structure to deliver successful brands, nearly three-
quarters of Top 100 managers in the consumer goods sector agreed this to be
the case. This compared to less than half the managers of Outsider brands
who also agreed. The difference was statistically significant. It was
suggested that, since many Top 100 brands were over 25 years old and in
some cases more than 100 years old, that their companies had had longer to
develop an organisational structure that enabled them to meet their brand
objectives. However, in the consumer services sector, not as many brand
managers considered their organisational structure helped them manage
successfully in either Top 100 or Outsider brand companies. It was suggested
that Top 100 brand companies reassess the value of their predominantly
hierarchical structures and that Outsider brand companies should allow more
time to see the benefits of structural change.
The results, therefore, indicate that what is important to brand success, in the
consumer goods sector, is not the type of organisational structure per se but
whether that organisational structure allows managers of brands to manage in
the way they want to in order to deliver successful brands.
A sequence of steps was suggested. First define the brand objectives, then the
strategy to deliver those objectives and, finally, put in place an organisational
structure which allows both the implementation of the strategy and the
realisation of the brand objectives. This was illustrated in the following way:
Brand objectives ? brand strategy ? organisational structure.
Notes
1. Interbrand Top 100 ranking.
2. Brands outside the Interbrand Top 100 ranking.
3. Notes taken from The World's Greatest Brands, edited by Nicholas Kochan.
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 Appendix 1 ± The World's Top 100 brands by Interbrand
(1) McDonald's (51) British Airways
(2) Coca-Cola (52) Mastercard
(3) Disney (53) Mitsukoshi
(4) Kodak (54) Fedex
(5) Sony (55) AT&T
(6) Gillette (56) Persil
(7) Mercedes-Benz (57) Heineken
(8) Levi's (58) Campbells
(9) Microsoft (59) Fisher-Price
(10) Marlboro (60) Marks & Spencer
(11) IBM (61) Motorola
(12) Nike (62) Porsche
(13) Johnson & Johnson (63) Reuters
(14) Visa (64) Shell
(15) Nescafe (65) Mattel
(16) Kellogg (66) Honda
(17) Pepsi-Cola (67) Pizza Hut
(18) Apple Computer (68) Compaq
(19) BMW (69) Fuji
(20) American Express (70) Duracell
(21) Tampax (71) BP
(22) Nintendo (72) Johnnie Walker
(23) LEGO (73) Polaroid
(24) IKEA (74) Louis Vuitton
(25) Sega (75) Volvo
(26) Harley Davidson (76) Hewlett Packard
(27) Intel (77) Boeing
(28) Body Shop (78) Zippo
(29) KFC (79) Casio
(30) Heinz (80) Volkswagen
(31) Toyota (81) Ray-Ban
(32) Xerox (82) Smirnoff
(33) CNN (83) Budweiser
(34) Adidas (84) Philips
(35) Pillsbury (85) Sears
(36) Reebok (86) Pampers
(37) Cadburys (87) Schweppes
(38) Camel (88) Nivea
(39) Chanel (89) Reader's Digest
(40) Swatch (90) Kleenex
(41) Harrods (91) Canon
(42) Colgate (92) Virgin
(43) Toshiba (93) Financial Times
(44) Mars (94) Haagen-Daz
(45) Ford (95) Braun
(46) Time (96) Samsung
(47) Barbie (97) Gordons
(48) Rolex (98) Benetton
(49) Lucky Strike (99) Sainsbury
(50) BBC (100) Dr Martens

JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999 411

 Appendix 2 ± Detailed description of Brand Power dimensions[3]
Weight (dominance)
A high score for dominance tends to reflect a dominant market share. Brands which score well
in this category are usually clear market leaders but other factors are taken into account as well
like innovation and a clear brand focus, since these attributes are often shared by brands which
can have as much influence over their particular sector as the market leader, for example Apple
in personal computing.

Length (stretch)
This refers to a brand's ability to stretch into new categories and markets, an increasingly
important characteristic as the cost of new brand development and new brand launches has
become, in many cases, prohibitive.

Breadth (franchise)
This refers to the breadth of franchise the brand has achieved in terms of age spread, consumer
types and international appeal. A high score for breadth indicates a brand that can cross social,
cultural and national boundaries and hence is less vulnerable to local developments such as
changes in taste, legislation and financial instability.

Depth (commitment)
Brands achieving high scores for depth have developed intimate relationships with their
customers usually on the basis of shared ``central'' or ``higher'' values such as the ``cult'' status
of Ray-Ban.
&

412 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999

 This summary has been
provided to allow managers
and executives a rapid
appreciation of the content
of this article. Those with a
particular interest in the
topic covered may then read
the article in toto to take
advantage of the more
comprehensive description
of the research undertaken
and its results to get the full
benefit of the material
present
JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999
Executive summary and implications for managers and
executives
It's what you do not just how you organize it
The idea that the design of something reflects its purpose is long established
± beginning with the study of living creatures, the concept that ``form follows
function'' has been adapted for architecture and product design.
Hankinson's study of organizational structure and its effects on the success
of brands perhaps takes ``form follows function'' from the world of physical
things into organizations. What strikes me is that the organizational
structure of successful brand owners perhaps reflects their focus on driving
success through those brands.
Hankinson notes that many of the brands featuring in the Top 100 brands are
long established ± in some cases over 100 years old. She comments that this
historical factor might be one element in determining organizational differences
between successful and less successful brand owners. However, we need to ask
ourselves whether the organizational structure of successful brand owners has
evolved to deliver the best support to the brand or whether the choice of a
particular organizational structure contributed to the success of the brand.
History and brand success ± inertia and double jeopardy
In acknowledging that the long-established nature of many leading brands
may be a key factor in their continued success, Hankinson reminds us of the
challenge of consumer inertia and the idea that brand leaders have less
promiscuous customers than secondary or tertiary brands. Without dramatic
market changes, it is extremely difficult for a follower brand to topple the
brand leader ± regardless of the organizational structure.
For the established brand leader the advantage of more resources for
promotion, more shelf space and the visceral consumer belief in that
product's superiority all mean that ``outsider'' brands (as Hankinson
describes them) have their work cut out to challenge the hegemony of the
brand leader. This then raises the question as to whether copying the brand
leader's organizational structure will produce success.
The leading brand will have an organization focused on sustaining brand
leadership. The brand strategy is ± by definition ± defensive rather than
developmental. Product development, advertising and trade promotions are
all geared to protecting what we have rather than getting share from other
brands. Even when the tactics appear aggressive they often reflect the use of
market power to force the hand of retailers or resellers.
In contrast, the developing brand must secure new customers at the same
time as retaining existing customers. And, if brand leadership is the aim,
then most of the new customers will come from the brand leader rather than
other competing brands. In truth, very few ``follower'' brands ever succeed
in overtaking the brand leader.
If it ain't broke, don't fix it
Brand leaders have changed their structures in order to deliver, among other
things:
. reductions in the cost of brand communications and brand development;
. tighter control over the marketing channels;
. a more strategic role for brands;
. improve product and organizational quality.
413
 We recognise the importance of the brand but restructuring reflects modern
thinking rather than a way of becoming more brand-focused. Yes, there are
changes in the way that we look at brands and in the practice of brand
management, but these changes do not put an end to the fundamental
principle ± that the brand has an individual champion given targets on sales,
market share and ``brand equity''. What has happened is that the owners of
strong brands have recognised that those brands are among the firm's vital
assets. The brand manager is not just using the brand to increase sales but is
investing in the development of an important asset.
In terms of brand management, little differs for the ``outsider'' brand. The
problem is that the smaller brand must put more effort into keeping the
current customer and more effort into getting the new customer. The
dissatisfaction with structure signalled by Hankinson's research may reflect
this difficulty. Because the job is harder for the ``follower'' brand, the
systems by which that brand is advanced are more likely to be criticised.
However, as Hankinson points out, we cannot argue that a flatter organizational
structure will necessarily provide brand advantages ± even where it makes the
firm more efficient and more profitable. Yet, faced with the thankless task of
trying to overhaul a leading brand, the brand manager may take the view that
changes to organizational structure may deliver better results.
We might compare this to the struggling sports team. This team compares itself
to the league champions and asks why they are successful. The result is a new
structure aping that of the winning team. They have foreign players ± we'll have
foreign players. They have a training academy ± we'll have one too. They have
an all-powerful team manager, that's what we do. And the result of all this?
Very often little or nothing. After all these changes they're still league
champions and we're still struggling. Indeed things can be even worse for us
because all the changes have destabilised our team. Constant chopping and
changing result in personnel problems and our results get worse.

More market focus ± less navel gazing

The problem with making structural changes is that they can be seen as doing
something. And so long as things are changing we tend to assume (or at least,
hope) that things will improve. What Hankinson's research shows is that flatter
organizational structures do little to help brand management or improve
marketing performance. This is not, of course, to suggest that such organizational
changes are unnecessary or ineffective. But better brand management comes from
market and customer focus rather than greater internal efficiency.
It's not easy to topple the brand leader. But it can be done by the business
willing to focus on the market and the customer rather than trying to outdo
what the market leader does. This all too common problem results in failure
± to win you have to find your own way of doing things and you must stick
with that approach for long enough to let it work. If nothing else is learned
from studying the Top 100 brands, you should realise that most of them are
there because they've stood the test of time.
If you are consistent, invest in your brand and avoid simply following the
brand leader because they're brand leader, you will improve your chances of
success. And if you can do this for 20, 30, even 50 years then you'll deserve
your place with the big brands.

(A preÂcis of the article ``An empirical study which compares the

organisational structure of companies managing the World's Top 100 brands
with those managing Outsider brands''. Supplied by Marketing Consultants
for MCB University Press.)

414 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 8 NO. 5 1999