The  Impact  of  Organizational  Structures:  Centralization,  Formalization,

To our knowledge, this research is the first to investigate how organizational structures help to facilitate or hinder the development of the BMS. We wanted to understand the effects of different designs, i.e., how work is coordinated and executed (John and Martin 1984), and its impact on the BMS. These results hold high managerial implications, as organizational structures are an internal

component that a firm can control, and influence.

More specifically, this study investigated the impact of centralization, which was expected to positively influence the BMS. However, this relationship is not significant, though it shows a positive contribution to the BMS. Next, we hypothesized that rules, and procedures through the organizational structure of formalization would positively impact the BMS. Our study shows that

formalization is an important facilitator to the BMS, with the second strongest effect. These findings show the value of evaluating leadership style, and how

marketing managers should choose to coordinate, facilitate, and carry out brand-related activities among employees. More specifically, this research has

particularly treated formalization in relation to marketing planning (Andrews and Smith 1996), as this is considered a major tool in how to deal with the

environment, and it implies that organizations think ahead of the desired actions and outcomes of the future. As implementation of marketing programs are one of the key responsibilities of marketers, this research provides support to how these processes should be managed. In particular, managers should place structured procedures, and formats for planning, and execution. Ruekert, Walker, and Roering (1985) have found a positive relationship between formalization, and performance within the marketing department. More specifically, one of the abilities of formalization is to bring routines to activities, and limit risks (Ruekert, Walker, and Roering 1985). Therefore, we argue that formalization has the ability to bring clarity, and understanding of the treatment of brands among employees, and consequently it positively impacts the BMS. Also, as this organizational structure can potentially foster learning (Nahm, Vonderembse, and Koufteros 2003, 285; Koufteros and Vonderembse 1998; Damanpour 1991; Ettlie, Bridges, and O’Keefe 1984; Dewar and Werbel 1979; Pierce and Delbecq 1977; Aiken and Hage, 1971; Evan and Black 1967; Thompson 1965), it will positively impact the dimension of the BMS that entails brand-related knowledge, and education among employees, which enables the alignment of employees’ behavior with the brand identity (Santos-Vijande et al. 2013).

In the domain of organizational structure, we expected that a specialized structure in the marketing department would act as an impediment to the BMS. Due to the nature of specialization that involves a narrow division of activities, carried out by individuals with specialized knowledge (Vorhies and Morgan 2003) - we expected that this structure would inhibit the development of the BMS. This study

contributes to the literature by showing that specialization has a negative, and significant impact on the BMS - representing the second highest impact of all the influencers. The results show that managers should be aware of the possible downside of specialization, as is it might entail that relevant information stays as exclusive details among individuals. More specifically, we argue that the nature of specialization can lead to the absence of information sharing, and make the

Consequently, this means that managers should encourage an environment where employees share knowledge, and insight about the brand. Overall, even though this research is the first to investigate how organizational designs impact the BMS, we find similarly that centralization, and formalization vary inversely with specialization (Ruekert, Walker, and Roering 1985, 20; Hage 1965).

Previous research has shown that organizational structures can have a profound effect on organizational outcomes (John and Martin 1984; Hall 1977; Moch and Morse 1977). More specifically, we investigated, and expected that specialization would have a negative impact on customer performance. Among the hypothesized variables that could have a direct effect on the outcome variable, specialization shows the second largest negative impact. We argue, that specialized structures within the marketing department might inhibit that vital information about customers is shared, and acted upon. Another explanation of the effect of

specialization can be related to some of the characteristics of the Norwegian food processing industry, i.e. the “standard volume paradigm” with a high focus on efficiency (Stræte 2006). According to Olson, Slater, and Hult (2005, 61) firms that have a high focus on efficiency-related advantages, marketing generalists instead of specialists are more useful as they can work with a variety of tasks, and identify areas that can help to control costs. We argue that increased efficiency, and lower costs enable a firm to provide more value to the customer such as offering products with lower prices. Thus, this organizational structure can be highly relevant for the context of our study.

The final domains of organizational structures investigated in this study were horizontal integration and communication. Based on existing theory, we expected that the use of cross-functional teams (horizontal integration), and the use of cross-functional communication (communication) would have a positive and significant effect on the development of the BMS as they both seem to promote education and training of the employees – a central part of internal branding.

However, their contributions to the BMS were weak and statistically insignificant.

From a manager’s perspective, this does not imply that these aspects are not important for an organization; rather it indicates that they do not specifically impact the BMS significantly.

5.2.3 The Influence of the External Environment: Reputational Assets and