fl W~ a. 3‘53 "firtt «at . !" (kt‘rrr NEBEEH ,fl'J . 3‘s, 4“. "g {.13.} wrv ‘4 53:29:35- , . l ‘J $3; 1P3“. ' V V_ - m 4"?) ‘ ,‘é; £1 ' l "-1 . 31.1.3; 4 “w' -' ' ‘ ‘ ‘ Rt Vw‘:l;Z:-i4£~‘3i€>;5; ~. A ' "h ‘ :' A' 4 . . 'A “‘- ‘ . - .1, < 4 4n .4 ‘1. V K 1“ . 1.4, 3w. .1 i ‘ . 2t, ,5 ., 45 . ..,, p t v 1 ~ -a Sm: . .: . ' A ‘ 1'15. ‘- r - "”1“?” ‘- ‘fl‘ 3" ' I. 7 '4'? "a " “ " a-‘fi‘fl's‘ -, . 4 a ‘ . M. . . 393:4: " a. ‘9, . $5" ‘ "' ’fitr'. ‘ 1 5 ‘. 4):; x : 9 ; 4 (A‘ 4‘ «If! 'I.. hill ' , ' ‘ . »- J4 ‘4 4 - .' ‘ ‘ " i ‘I‘ ‘1'“: . E v - - A ; , , . 4, 4 , - 4 \ ,0 A, , LI‘ - 1 4 v . .. . ~ t v. . "F .4 w . L3"? ' 3‘2: it 1.4 _ a: lliiiiliiililiiliiiliiiliiiiliiflil iililiiiliil ; 3 1293 01024 0038 This is to certify that the thesis entitled STRATEGIC MARKET PLANNING CONVERSION PROCESS: AN EXPLORATORY STUDY FOR PUBLIC LEISURE SERVICE presented by James N. Holleran has been accepted towards fulfillment of the requirements for Ph.D. degree in Park, Recreation and Tourism Resources Major professor DateM¢ 0-7639 MS U i: an Affirmative Action/Equal Opportunity Institution LiBRARY Michigan State University CE ll RETURN BOXtoromavomiochockomm ywrocord. To AVOID FINES rotum on or botoro duo duo. __________________,_________———- i _ e 1i -——-——i”:[\—-——-— i ; 1’4 ‘LEJLQ MSU lo An mm Maul Opportunity lmtituion Wanna-M STRATEGIC MARKET PLANNING CONVERSION PROCESS: AN EXPLORATOR! STUDY FOR PUBLIC LEISURE SERVICE By James N. Holleran A DISSERTATION Submitted to Michigan State University in partial fulfillment of the requirements for the degree of DOCTOR OF PHILOSOPHY Department of Park and Recreation Resources 1994 ABSTRACT STRATEGIC MARKET PLANNING CONVERSION PROCESS: AN EXPLORATORY STUDY FOR PUBLIC LEISURE SERVICE By James N. Holleran This research focuses on the challenges faced by a public leisure service agency in adopting strategic marketing planning. Using a case study approach, this exploratory research study provides a comprehensive review of the agency conversion process. The Fort Wayne Department of Parks and Recreation (the case study agency) was studied as it attempted its conversion from a product/service to a market-driven agency. The author served as a facilitator and observer. Study findings provide a general framework for future research needed to test study recommen- dations. The applied research contributions of the study were directed at public leisure agency managers who were considering the adoption process or had less than optimal success with past efforts. Specific research concepts include applications relative to the initiation and formulation of marketing organizational structures and planning systems used and refined at Fort Wayne. These organizational systems were designed to support both long-term strategic market planning and short-term market- ing implementation through staged annual market plans. Marketing research strategies for conducting both environmental image and service need assessments provide useful application tools. Research results stress the many agency challenges associated with the conversion process and suggest that, depending on the stage of market readiness of an agency, it can take up to 3 to 5 years for the conversion to take place. Agencies initiating the conversion are recommended to consider utilizing the strategic market planning process to both prepare long-term plans while creating internal capabilities for their implementation. The focus of the conversion should not be on the development of marketing plans but on the process of implementing, monitoring, and controlling marketing strategies and tactics identified in the plans. Though limited to one case study application, the research repre- sented in this study is of value if it contributes to a more general understanding of the process required of agencies in attempting to adopt strategic market planning. Copyright by JAMES N. HOLLERAN 1994 ACKNOWLEDGMENTS A careful reader of this study will undoubtedly note the large gap between the time the research was conducted and when the dissertation was completed. The longevity of the project has placed a greater than necessary burden of responsibility on the study committee, and the author's family and friends. Without their long-term continual support and pressure, the study would not have been completed. The author wishes to acknowledge his sincere thanks to all those who have contrib- uted to the successful completion of the study. A special note of appreciation is given to Barbara Ponder, friend and wife, who has been supportive throughout the process. TABLE OF CONTENTS CHAPTER 1 PROBLEM STATEMENT AND STUDY OVERVIEW Introduction . Problem Statement . . Research Strategy Overview . Key Study Features 2 LITERATURE REVIEW . Introduction . The Marketing Mix . The Strategic Marketing Planning Process Analysis of External and Internal Environments The External Environment . . . Internal Environmental Assessment Assessing Agency Customer Orientation Marketing Research . Setting Marketing Mission, Goals, and Objectives Goal Formulation . Establishing Core Marketing Strategy The Portfolio Assessment . Target Markets Competitive Positioning The Marketing Mix Designing and Planning Organizational Systems Introductory Phase . Growth Phase Mature Phase . The Strategic Choice Getting Started . . . The Marketing Orientation Process . . . Market Strategy Implementation, Assessment, and Control . Implementation . Marketing Assessment and Control . Strategic Market Planning. A Process and Not an Event . vi PAGE \ibNi—i 10 10 10 13 15 15 17 17 22 24 24 27 28 28 31 32 32 33 33 33 34 35 38 . 43 . 44 . 44 . 46 TABLE OF CONTENTS (CONTINUED) CHAPTER 3 CASE STUDY IDENTIFICATION AND MARKETING ASSESSMENT I. Case Study/Agency Identification Introduction . . . The Case Study Agency - An Overview . The City of Fort Wayne . . The Fort Wayne Department of Parks and Recreation (FW- DPR) II. Case Study/Marketing Assessment Introduction . Application of Planning Strategies Marketing Assessment - Initiation Audit Marketing Assessment - Case Study Agency Agency Limitations and Constraints Policy Related Issues Administration/Management Resources . Market Research Assessment Studies Internal Staff Image Assessment Departmental Image in Community DPR Service Distribution Assessment Community Needs Assessment . Assessment of Competing Community Leisure Service Providers (DPR Positioning Study) 4 CASE STUDY MARKET PLANNING APPLICATIONS AND FINDINGS Introduction . I. Case Study Market Planning Applications Recommended Marketing Planning Systems Introduction . Profile of the FW- DPR Market Planning Management System . The Market Steering Committee (MSG) The Market Planning Teams Program/Facility Specific Market Planning Teams (MPTs) . The Annual Market Planning Process Introduction . Pre-Planning Stage Plan Development Stage Action Stage . . Market Planning Process - Summary . vii PAGE . 47 . 47 . 47 . 48 . 48 49 54 54 54 56 56 57 57 70 77 . 79 80 . 81 81 82 83 84 84 85 85 85 85 92 93 94 99 . 99 100 102 105 105 TABLE OF CONTENTS (CONTINUED) CHAPTER II. Case Study Strategic Market Planning Strategies and Major Findings . . . . . . Introduction . The Marketing Orientation Process The Fort Wayne Experience Strategic Market Planning Strategies The Strategic Market Planning Model What Strategic Market Planning Strategies Were Completed . . . . . . . . Marketing Research . . . . Case Study Organizational Structure Development . Goal Formulation . What Strategic Market Planning Strategies Were Planned for Completion . Strategy Formulation . Systems Design . 5 CASE STUDY FINDINGS, RECOMMENDATIONS AND FUTURE RESEARCH STRATEGIES Introduction . I. Case Study Recommendations General Case Study Recommendation . Agency Orientation to Market Planning . Agency Orientation Recommendations Organizational Design . . Recommended Three- -Stage Approach . Organizational Design Recommendations Application to Smaller Agencies Marketing Research . . Marketing Research Recommendations Goal Formulation . Goal Formulation Recommendations Strategy Formulation . Strategy Formulation Recommendations Systems Design . System Design Recommendations II. Recommended Strategies for Future Research . Introduction . Recommended National Study . . . Step 1: Conduct of the National survey . Step 2: Conduct of Public Leisure Service Agency Case Studies . Alternative Suggested Research Approach . viii PAGE 109 109 109 109 110 110 114 115 121 122 127 127 149 161 161 161 161 163 166 167 167 172 174 175 176 177 178 179 179 181 181 182 182 182 183 185 187 TABLE OF CONTENTS (CONTINUED) CHAPTER PAGE APPENDIX 1: Fort Wayne-DPR Mission Statement . . . . . . . . . . . 188 APPENDIX 2: Fort Wayne Internal Image Survey Form (In-house Departmental Analysis) . . . . . . . . . . . . . . . . 189 APPENDIX 3: Community External Image Assessment Survey Form . . . . 190 APPENDIX 4: CNA Survey Form (Fort Wayne Department of Parks and Recreation Survey) . . . . . . . . . . . . . . . . . . 191 APPENDIX 5: Competition Survey Form (Fort Wayne Leisure Service Agency Survey) . . . . . . . . . . . . . . . . . . . . 195 LIST OF REFERENCES . . . . . . . . . . . . . . . . . . . . . . . . 199 ix TABLE 4-8 4-9 4-10 4-11 4-12 4-13 5-1 5-2 5-3 LIST OF TABLES Market Steering Committee (MSC) Responsibilities Market Planning Teams (MPT) Responsibilities (Long Term) Market Planning Teams (MPT) Major Team Responsibilities (Short Term) . . . . . Program/Facility Specific Market Planning Teams (Short- Term Responsibilities) Program/Facility Market Planning Team Representation Stage I: Pre-Planning Activity by MSC/MPTs Stage II: Plan Development Stage Activity by MSC/MPTs Stage III: Action Stage Activity by MSC/MPTs Sequence of Major Market Planning Activities Associated with Goal Formulation Strategy Case Study Strategy for Identification and Selection of Market Segments . A Continuum of Alternative Strategies Related to Market Segmentation Establishing a State of Market Readiness: Issues for Examination . Marketing Control and Evaluation Systems--Information Data Bases to Support SMP/Annual Action Planning Recommended Organizational Structure by Stage of Market Planning Concepts Recommended Major Market Planning Activities by Stage of Organization Development . Two-Step Process Recommended for Follow-up National Survey PAGE 88 89 94 96 97 103 106 107 126 132 134 147 151 168 170 186 FIGURE 2-1 2-2 2-3 2-4 3-1 3-2 4-1 4-10 4-11 4-12 4-13 4-14 LIST OF FIGURES Conceptual Overview of Marketing Activities . Steps in Market Segmentation and Target Marketing . Organizational Structure - Cycle of Adaptation Strategic Planning Game Plans Framework of Key Components for Developing Market Readiness Three Alternate Approaches to Delivering Recreation and Park Services Internal Market Planning Management System Market Planning Committee/Team Representation . Primary market Planning Responsibilities by the MSC/MPTs Planning Stages Developed for the Market Planning Process Market Planning Process: An Overview of Staged Activity by Planning Teams A Generic Strategic Market Planning Model . Refinements Made to the Generic Strategic Market Planning Model . Case Study General SMP Model Case Study Market Research Case Study Sequence for Strategy Formulation Framework for Programming Financial Objectives Market Segment Grids Departmental Program Portfolio Analysis An Illustration of the Integration of Data Elements to Support the Marketing Program . xi PAGE 11 29 36 37 57 60 86 91 98 101 104 111 112 114 115 129 130 139 142 160 CHAPTER 1 PROBLEM STATEMENT AND STUDY OVERVIEW Introduction Cultural, political, social, and economic changes over the last 15 years have had a tremendous impact on the field of parks and recreation. Departments responsible for delivery of public leisure services have been challenged to reexamine their traditional management practices in their attempts to respond to these conditions. As witnessed at several national recreation conferences, a number of leisure service agencies at all levels of government have undertaken the task of reviewing the function of planning. Specifically, they have incorporated at least Some strategic market planning elements developed initially in the private sector into their management systems. The period for increasing budgets and major new capital development programs which enabled public park and recreation agencies to meet citizen demands with little strategic planning appears to have passed. The current season provides a less predictable environment in which primary planning concerns must respond to the impact of such elements as new competitive forces, reduced tax support, increased accountability demands, regulations, and legal and legislative requirements. The scope of previous planning strategies, generally limited to the allocation and design of physical spaces and facilities, fails to address the major problems confronting park and recreation agencies today. 2 John L. Crompton (1983), one of the foremost researchers and publishers in the area of leisure marketing, has written that "planning must be viewed as the anticipation of environmental change and the development of appropriate strategies and actions to deal with that change...physical planning is only one small part of an agency's operations" (p. 56). Crompton has suggested that in a period of retrenchment, physical planning is of less importance than formulating directions and realigning public resources to ensure effective and efficient service delivery efforts in the future. The challenge then, for park and recreation professionals in dealing with the more complex and less sympathetic environment char- acteristic of current times, is to find the appropriate means to change focus from facility-oriented master planning to market-oriented strategic planning. Crompton (1983) stated: Traditionally, many government and social service agencies have started (planning) with mission statements and objectives. Such an approach starts from the inside and works out to the consumer. A strategic marketing approach starts from the outside and works inward. That is, starts with an analysis of the macroenvironment and the consumer and, after identifying consumers' wants and needs, uses them as the basis for formulating the agency's mission and objectives for guiding its marketing strategy.... (p. 57) Problem Statement The private sector has long recognized the importance of strategic market planning as a requirement for business survival. For purposes of this study, strategic market planning is defined as the set of steps an organization must take to decide what actions it must take to respond to changing internal and external environmental conditions and marketing 3 opportunities and threats. Many manufacturing companies use their strategic market plans as operational blueprints for making marketing decisions. These decisions will determine selection of the target markets it will serve and the mix of services the company will offer. There is a wealth of literature written about the development and implementation of strategic market planning models for use in the private sector. Yet, it has only been in the last 20 years that market specialists such as Kotler, Crompton, Lovelock, and others have written about the need for and application of such models in the public sector. Most of this literature focuses on the general application of market planning principles but falls short of identifying operational-level processes which can be used by public agencies to expand upon tradi- tional physical planning approaches to include market planning. As an exploratory study, the problem to be addressed in this report is the identification and examination of the steps and procedures that are involved in the "conversion process." This conversion process is described as the initiation and integration or adaptation of the strategic market planning process for a public leisure service agency. The information obtained through a case study approach will then be used to establish research recommendations providing direction for recom- mended follow-up descriptive research. It is posited that this study will provide practical and useful information and guidance needed by park and recreation professionals who may be considering such a planning conversion process. It is assumed that general application of study findings and recommendations should be readily applicable to county, state, and other levels of government service. Extensive energy, resources, and expense are involved in the process of adopting a new A. planning approach and incorporating it into an existing management system. Practical guidance supported by actual field experience will hopefully reduce management risk in undertaking the conversion process. The development of future descriptive research models or approaches, supported by recommendations established on the bases of study findings, will provide a starting point for future research needed to increase understanding of the conversion process. Research Strategy Overview An individual agency case study approach was utilized in the conduct of this study. The primary supportive assumption for selection of this methodology was that a field test and exploratory examination of a trial implementation of a strategic market planning process would provide the best opportunity to examine the problem given the resource constraints of this researcher. The major steps involved in this research study included: 1. Selection of a case study agency. A mid-sized municipal park and recreation department which was interested and willing to par- ticipate was identified. This agency, the Fort Wayne Department of Parks and Recreation (DPR), had an interest in converting its management orientation from a product to a market driven system. 2. Identification and refinement of a generic strategic market planning model that would be appropriately shaped to meet the needs, interests, and resources of the case study agency and still have general application to other public leisure service agencies. 3. Evaluation of existing case study agency management systems and implementation of new strategic market planning management systems 5 adjusted to the case study agency. The new system, designed with consideration for application to other public leisure service agencies, would support both preparation of the strategic market plan (SMP) and its on-going implementation through an annual market planning process. 4. Initiation of the SMP process and examination of the problems, constraints, successes, and failures associated with the experiment. 5. Identification of recommended changes and generalizations of the planning conversion process to other public leisure service agencies to include recommendations for future related research. Chapter 2, a literature review, provides a broad examination of major strategic market planning concepts developed for application in the services industry and, where available, applied directly to public and nonprofit organizations. An overview of the Fort Wayne Department of Parks and Recreation (DPR), the case study agency, is given at the beginning of Chapter 3. This agency was able to secure federal funding support from the Urban Planning Action and Recovery Program administered through the National Park Service. The funding was secured for purposes of developing a SMP. Chapter 3 also includes a marketing assessment of the Fort Wayne DPR, with a focus on the major study constraints and limitations identified through conduct of the study. This includes, for example, the challenge faced by this researcher in educating agency management about the process of marketing. A major problem was the initial expectation of agency managers that a SMP could be developed with little direct involvement of departmental staff. Such an expectation generated early study constraints. Chapter 4 includes a description of a trial generic SMP model that was selected for implemen- tation. The description includes the refinements made to adapt the 6 model to meet agency needs and constraints. This is followed by a detailed discussion of the management planning system applications developed to support the preparation and implementation of the SMP. Emphasis is placed, in this section, on the procedures used in lieu of focusing specifically on actual planning results. For example, discus- sion will highlight how findings from two DPR image surveys and those of a community-wide leisure needs assessment yielded consistent results useful in developing market planning strategies for the case study agency. The balance of Chapter 4 is devoted to identification and explana- tion of what was considered to be the major SMP findings developed from implementation of the study. Emphasis is on the identification and interrelationships of critical market planning management systems and approaches required in a Department of Parks and Recreation (DPR) to be "market ready." Without these systems in place, a leisure service agency will find it difficult to fully implement, monitor, and control the effectiveness of its marketing strategies. This focus was con- sidered important in light of what this researcher determined to be a major problem faced by public leisure service agencies. That is, traditional agency planning models used by DPRs, as indicated earlier, were focused on development of master plans for capital improvement projects. DPR managers had the experience, knowledge, and support systems necessary to implement such plans. With this experience framework, many DPR managers, it's believed, have attempted to adopt market planning without full consideration of the constraints involved. That is, they believe that a DPR should be able to write, or have written for them, a SMP which should then be implemented using existing 7 management systems. As a result of this study, it became very clear that key marketing management support systems are required. This includes appropriate agency orientations, policy positions, and market- ing information systems. These were found to be important prerequisites to the SMP process. Failure of the Fort Wayne DPR to have these elements in place resulted in a delayed schedule for producing the SMP within the initial targeted time frame of this study. The models and concepts either implemented during the study or recommended for imple- mentation but not fully carried out during the study are identified in Chapter 4 and should be valuable to DPR managers in their assessments of their agency's state of "market readiness.” Chapter 5 consists of study recommendations as well as recommended strategies for future descriptive research studies. The proposed future research strategies would allow for further examination of the studied conversion process and provide a further test of the recommendations developed as part of this exploratory research study. Key Study Features A municipal department of parks and recreation was identified as the recommended agency for this case study for several reasons. First, given the trend towards governmental decentralization in the financing and support of leisure services, municipal parks and recreation depart- ments can be expected to be placed under greater pressure to provide continued leisure services with fewer resources. Municipal departments typically have greater resource constraints in terms of tax dollars and personnel from which to draw upon than larger governmental units. Second, urban parks and recreation departments have been experiencing 8 growing consumer demands for leisure services to be provided closer to home, reducing participation costs. In short, it was believed that the greatest contribution to the profession from the results of this study would be made by focusing research efforts at the municipal level. The major strength of the research design is the "hands-on" approach to examine the conversion process. That is, testing both the strategic market planning model and the experimental management systems established to support development of the long-range strategic market plan and the on-going market planning process. Field experimentation involves a continual dialogue with agency staff resulting in continual modification and adaptation of initial approaches. Starting with a defined set of theoretical objectives, this integrative process seeks a balance between meeting required market planning standards, providing general application to other public leisure service agencies, and the case study agency's ability and willingness to adopt new management concepts. A major weakness inherent in the study design is its failure to fully evaluate the long-term effectiveness of the adopted strategic market plan and supportive management systems. Such an evaluation would require continual monitoring and evaluation of the department's perform- ance in meeting both long- and short-term market plan objectives. Such procedures would have required resources beyond those available to conduct this study. A secondary constraint is the limitation of the case study approach to only one municipal agency. Again, resources needed to fully implement and evaluate the market planning conversion process for more than one site were not available. Other concerns included the resource constraints of money, manpower, and time available 9 to the case study agency which influenced the scope of the study process. The recommendations regarding generalization of study findings to other urban park and recreation departments include consideration of these limitations. CHAPTER 2 LITERATURE REVIEW Introduction The literature review provides a brief overview of marketing principles in the service sector with applications in governmental and nonprofit organizations. Specific attention is focused on the general approaches and theories associated with the Strategic Market Planning process. Figure 2-1 below (Crompton & Lamb, 1986) provides a conceptual overview of marketing activities aimed at facilitating and expediting exchanges. The authors indicate that the activities entail: O Gathering information on the organization's environment 0 Researching client benefits or wants desired of the agency Setting marketing objectives Allocating priorities and resources in light of equity decisions on whose wants are to be served Chapter 4 includes a further review and case study application of the strategic market planning model which includes the activities discussed above. The Marketing Mix The marketing mix involves the integrated utilization of four Ps-- product, price, promotion, and place. These essential tools for the 10 ll MARKETING INTELLIGENCE - Noodo Aooooomon: Environmomol Anolyolo 1 AGENCY MISSION I MARKETING STRATEGY DESIGN SELECTION OF TARGET MARKETS 1 MARKETING AND ALLOCATION ‘ ouecmes OF RESOIRCES MARKETING MIX Product OIotrbuIIon location ochoduIIno Prlco Promotlon i IMPLEMENTATION IN THE ] DYNAMIC ENVIRONMENT i * EVALUATION I Figure 2-1. Conceptual Overview of Marketing Activities. Source: Crompton & Lamb (1986), p. 17 implementation of the firm's marketing strategies can be described as follows: Product--the offering; a benefit bundle providing a problem solution or want satisfaction; insurance companies or banks refer to policy or account types as products. Price--the amount of money in exchange for which the seller is willing to perform the service; the cost to the buyer; rarely referred to as price--instead, words like premium, tuition, rate, fee, retainer, honorarium, fare, interest, and charge are used. Promotion--informative and persuasive messages to encourage target market members to purchase the firm's services; this includes advertising, personal selling, sales promotion, and public relations. 12 Plagg--the service delivery or distribution system; this covers such considerations as number of service outlets, facility locations, and design. (Johnson et al., 1986, p. 11) All of these elements must be combined into a cohesive package. Over the last decade, there has been some debate about the appropriate application of the traditional marketing mix to the services industries. For example, Magrath (1986) has argued that services marketing planning and execution should focus attention on seven Ps: the traditional four, noted above, plus three additional marketing mix elements that he suggests are crucial to service success--personnel, physical assets, and process management. Morrison (1989) has also developed an eight "P" model for hospitality and tourism marketing, which includes, in addition to the traditional four: partnership, people, packaging, and programming. Partnership is described by Morrison as those cooperative activities, such as cross-selling and joint advertising, which occur between service providers. The element identified as people refers to the importance of internal marketing in the service industry. The elements of packaging and programming are tied to the activities associated with the assembling and activity administrating combination of related services considered desirable by customers (Morrison, 1989). Cooper (1979) has suggested that problems may occur if the four P3 of marketing are directly transferred to nonprofit organizations without acknowledging the difference in the environments. If the health care environment is considered, as an example, Cooper proposes the use of C.A.P.S. to replace the four Ps. The C.A.P.S. of health care marketing are I 13 C: Costs/considerations (price) A: Availability/access (place) P: Promotion with emphases on public relations/atmospherics rather than on advertising S: Service development (product) The Strategic Marketing Planning Process Kotler and Andreasen (1987) describe strategic planning as the managerial process of developing and maintaining a strategic fit between the organization's goals and resources and its changing market oppor- tunities. The strategic market planning process is a set of steps an organization must take to decide what to do in any given market situation and is based on the assumption that marketing is a function that must operate within two environments. First, it operates within an organization so future marketing actions must fit with what the organization as a whole wishes to do. Second, marketers must take into account organizational abilities to take advantage of the opportunity the external world presents. This requires that the planning process consider organization strengths and weaknesses in evaluating external opportunities or threats (Crompton & Lamb, 1986). Strategic market planning can and should be nested within existing organization-level strategic planning (Greenley, 1986). Before market planning is initiated, the organization's top-level managers and advisory or legislative boards ideally should have accomplished the following: 1. Determined the organizational-level long-term mission, goals, and objectives. 14 2. Assessed the organization's likely future external environment, of which the marketing environment is a subset. 3. Assessed the organization's present and potential strengths and weaknesses, of which those related to marketing are a subset (Kotler & Andreasen, 1987). The organization's mission is a statement of its basic purpose or what it is trying to do. Top-level managers must address such questions as "What is our business?" "What is the value to the customer?" What will our business be?" "What should our business be?" (Masterson, 1991). A recommended approach (Kotler & Andreasen, 1987) to defining mission is to establish the organization's scope along three dimensions. The first is consumer groups, namely, who is to be served and satisfied. The second is consumer needs, namely, what is to be satisfied; and the third is technologies, or how consumer needs are to be satisfied. The strategic market planning process includes the following steps: 1. Determine organization-wide objectives, mission, and specific goals to which marketing strategies must contribute. 2. Assess external environmental threats and opportun- ities that can be addressed by marketing in the interest of achieving greater organizational success. 3. Evaluate present and potential organization resources and skills to take advantage of the opportunity or repel the threat identified in the external environmental analysis. 4. Determine the marketing mission, objectives, and specific goals for the relevant planning period. 5. Formulate the core marketing strategy to achieve the specified goals. 6. Put in place the necessary organizational structure and systems within the marketing function to ensure proper implementation of the designed strategy. 7. Establish detailed programs and tactics to carry out the core strategy for the planning period, including a timetable of activities and assignment of specific responsi- bilities. 8. Establish benchmarks to measure interim and final achievements of the program. 15 9. Implement the planned program. 10. Measure performance and adjust the core strategy, tactical details, or both as needed. (Kotler & Andreasen, 1987). The above steps provide a general framework for the case study activities which are described in Section II of Chapter 4. Analysis of External and Internal Environments The External Environment The external environment in which an organization operates is complex and constantly changing. Kotler and Andreasen (1987) define this external environment in terms of four components: (a) the public environment, (b) the competitive environment, (c) the macroenvironment, and (d) the market environment. The public environment. The public environment consists of groups and organizations that take an interest in the activities of the focal organization. A public is a distinct group of people, organizations, or both whose actual or potential needs must in some sense be served (Kotler, 1982). Publics are generated in response to organizational activities and policies which can draw support or criticism from outside groups. The competitive environment. The growing competitive environment in the services industry was discussed earlier. This trend is con- sistent in the area of government and nonprofit service organizations. Many managers of these organizations either deny the existence of competitive groups or recognize their existence but seem to think that competition is not nice since all public service organizations are, in some sense, attempting to achieve desirable social goals. Yet, when membership and attendance are lost, along with operating based revenues, 16 the reality of competition often becomes clearer (Crompton & Lamb, 1986). The macroenvironment. The macroenvironment consists of that combination of economic, social, cultural, technological, political- legal, and other external forces that exerts significant influence on the service organization but over which it has little if any control. Each service firm must examine the relevant changes in these environ- mental forces and assess their possible impact on the service marketing process. Service marketers must establish effective information systems to provide continuous monitoring of those external elements of critical importance to the organization. Books, newsletters, academic and trade conferences, trade journals and general business periodicals, special expert panels, and other tools should be utilized in this monitoring process (Crompton & Lamb, 1986; Rise, 1977; Powell, 1991). The market environment. The market environment consists of the key publics and other organizations that the service firm directly works with to accomplish its mission. The main groups in the market environ- ment are the clients, marketing intermediaries, suppliers, and supporters. Of real importance is the organization's work force and a later section of this chapter briefly discusses the importance of effective internal marketing strategies. The service firm must monitor trends and changes in the needs, perceptions, preferences, and dissatis- factions of these key groups. 17 Internal Environmental Assessment The internal environmental assessment requires an objective evalua- tion of the service firm's resources in its determination of internal strengths and weaknesses. The use of marketing audits are becoming an important tool for conduct of this process (Johnson et al., 1986). The audit, similar in concept to those used by accounting firms, provides a comprehensive checklist for appraising all facets of a firm's stage of market readiness. It involves a thorough review of the firm's post- marketing performance and an evaluation of its marketing objectives, organization, program, personnel, and services. This review helps service marketers identify inefficient and/or effective components that can be corrected or improved. Service marketers then have a better understanding of their firm's capabilities and know which of the marketing opportunities identified from external environmental analysis should be pursued (Johnson et al., 1986; Arnold, Capella, & Smith, 1982). Kotler and Andreasen (1987) describe a marketing audit as a compre- hensive, systematic, independent, and periodic examination of an organi- zation's marketing environment, objectives, strategies, and activities. All with a view of determining problem areas and opportunities and recommending a plan of action to improve the organization's strategic marketing performance. Assessing Agency Customer Orientation A key aspect of any internal environmental assessment, as part of the marketing audit, is assessing the agency's customer orientation. The following section includes a review of Kotler and Andreasen's (1987) 18 clues to examining an agency's orientation to its customers. The points made in this review strongly support many of the basic market planning strategy concepts reviewed earlier. Included are the need for market research systems needed to first identify customer needs and wants and later to monitor the success and failure of marketing strategies. Another key concept is the understanding and willingness to adapt market segmentation strategies. A willingness to move ahead of the politically safe position of providing leisure services for all community residents, equally, requires a full commitment by top management to the realization of the myth this supports and the political challenges associated with targeted services to meet needs of special market groups. The under- standing of the concepts of marketing competition and the realization that marketing is much more than promotion and communications are several other important points made below. Kotler and Andreasen (1987) indicate that the key to effective marketing strategy is the proper orientation toward the marketing function. Changes in marketing stages (product, production, selling, and customer orientations) provides a framework in which nonprofit agencies can compare their management strategies to determine which comes first--organizational needs and desires or that of their customers. Their clues to the characteristics of a customer-centered orienta- tion include: (a) Customer-centeredness[reliance on research. Management realizes that it must constantly monitor changes in consumer percep- tions, needs, and wants so that it can respond to shifts and become 19 proactive in its strategic planning. This forecasting capability comes from research which asks: (1) To whom are we planning to market? (2) Where are they and what are they like? (3) What are their current perceptions, wants, and needs? (4) Will these perceptions, needs, and wants be different in the future when our strategy is to be implemented? (5) How satisfied are our customers with our offering? Kotler and Andreasen (1987) explain that a heavy reliance on integrated market research comes from the realization that any specific marketing strategy will only be effective if it is: (a) designed with a full appreciation of the consumers it is designed to affect and (b) it must be pretested with targeted consumers to determine if it will have the effect intended. (b) Organizations routinely assume that markets ought to be segmented. The customer-oriented nonprofit manager in designing any particular marketing program will routinely assume, unless shown other- wise, that the market should be thought of as a combination of a great many smaller subsegments that may deserve separate marketing programs. Kotler and Andreasen suggest detailed approaches to market segmentation strategies, the basics of which were discussed in the strategy section above. (c) Organizations define the marketing concept broadly; not just in terms of communications or promotions. Kotler and Andreasen (1987) indicate that there is a key difference between an organization that is willing to adapt its offering, using the entire marketing mix, to meet 20 customer needs versus the organization which uses marketing communications to talk about their offerings in different terms. Howard and Crompton (1980) note that to many people concerned with public recreation and parks, marketing is an activity that is only appropriate in commercial profit-seeking firms. They suggest that more often than not, marketing is not distinguished from selling. Howard and Crompton (1980) stated: Like a store, a recreation and park agency also offers "products" which hopefully will satisfy its client's wants, but it calls them "programs," "facilities," or "services." Since the delivery of such products is the primary goal of recreation and park agencies, it seems likely that marketing techniques which have been successfully employed by business enterprises may prove to be equally useful to recreation and park agencies. (p. 305) Kraus and Curtis (1986) indicate that model park and recreation agencies have become resourceful in seeking out innovative forms of program support, increasing fees and charges, expanding concessions or contracting arrangements, encouraging cooperative program sponsorship, and soliciting government, foundation, or business grants and special gifts. The authors also suggest that innovative managers have also learned that it's not enough just to respond to the public's expressed needs and wishes. They must develop new forms of service and promote their leisure offerings as vigorously as commercial recreation organiza- tions have done. (d) Organizations define competition as coming from widely diverse sources, not just from similar products or ggrvices. Kotler and Andreasen (1987) point out that competition is best defined by whatever the customer thinks it is. For example, if going to a recreation sponsored music program competes with working in the garden or having 21 friends over for pizza in front of the TV, then those activities are the competition. (e) The entire organization becomes fully responsive to customers. The authors indicate that a major challenge facing all nonprofit agency managers is the degree to which a customer-centered philosophy is adopted in every aspect of the organization (Kotler & Andreasen, 1987). The authors indicate that one clue to monitoring this success is examination of how the organization handles consumer queries and complaints. They define a "casually responsive" organization as one which encourages customers to submit inquiries, complaints, suggestions, and opinions and makes periodic studies of consumer satisfaction. In contrast, a fully responsive organization also researches unmet consumer needs and preferences to improve its services and selects and trains its employees to be customer oriented. Crompton, the most prolific researcher and publisher in the area of leisure services marketing, has written extensively about many aspects of the marketing process. Crompton (1983) states that an increasing number of managers in recreation and leisure settings are recognizing that marketing offers a useful framework for explaining and integrating many of the decisions involved in the delivery of services. Yet, he suggests, few have had formal training in marketing with the result that there is a lack of insight and understanding of marketing principles and techniques. Crompton (1983) stated: Marketing is often presented as nirvana, a cure-all and solution to all management problems. However, much of what is currently applied under the name of marketing in this field is snake oil with minimal redeeming qualities. (p. 61) 22 Crompton (1983) indicates that in some instances, the principles of marketing when applied were deemed to have failed because either the expectations associated with them were unrealistic, or because there was a failure to recognize the differences between the objectives and operating environments of public leisure agencies and the commercial sector. Crompton (1983) noted that marketing was in its formative years in the recreation and parks field and that it suffers from frequent inaccurate conceptualization and inexperienced implementation. Ending on a note of optimism, he suggests that as the marketing concept diffuses, the public can look forward to a consistent rise in the quality of the performance of public recreation and park agencies. Kotler and Andreasen (1987) suggest that marketing is a management tool, a process wrapped in a philosophy, for helping an organization accomplish what it wants to do. It is a means to achieve one or many organizational goals and should not be considered, in and of itself, as a management goal. Therefore, all nonprofit agency managers must decide which decisions should or will be made yiph or without attention to marketing concerns. Some organizations, by their very nature, have more or less latitude in the extent to which offerings are customer driven. Agencies which are sales oriented should give marketing a central role while organizations whose basic offerings define who they are have limited change options. Marketing Research A major part of environmental assessments is the conduct of market- ing research. Kotler and Andreasen (1987) describe marketing research as the planned acquisition and analysis of data measuring some aspect or 23 aspects of the marketing system for the purpose of improving an organization's marketing decisions. Kotler indicates that nonprofit organizations carry out much less marketing research than they can or ought to due to limited budgets, relative newness in the marketing field, and their limited research expertise. Kotler also suggests the following steps, briefly described below, in developing a strategy for carrying out a planned program of market research: (a) Identify a marketing research mission. (b) Establish a research strategy. (c) Determine the overall research budget. (d) Identify detailed steps for strategy implementation. (e) Establish necessary organizational support systems to imple- ment strategy. (f) Establish a system of evaluation and control. Kotler and Andreasen (1987) indicate that the first step in planning the market research program is for management to determine if the primary purpose of the research is to be description (designed to describe the marketing environment), explanation (examines the reasons why various associations take place), or prediction (focus on variables used in both routine and one-time decision-making models). Chapter 3 provides a detailed internal marketing assessment of the case study agency and an introduction to the marketing research activities implemented during the case study to support both the internal and external environmental assessments. Findings from these studies are included in Chapter 4 along with the results of other case study market planning activities. 24 Setting Marketing Mission, Goals, and Objectives Service marketers, following completion of the internal and external environmental assessments, must integrate what has been learned into a long-term strategy for marketing. That is, the opportunities and threats in the external environment must be compared to the organiza- tion's strengths and weaknesses to determine what long-term course of marketing action will best achieve what top management has determined to be overall agency mission, goals, and objectives (Kotler & Andreasen, 1987; Schendall, 1985). Although different marketing texts use these terms of marketing goals and objectives interchangeably, for purposes of this study, marketing goals are defined as the precise statements which specify what is to be accomplished by the service firm's marketing efforts. These key marketing goals can then be translated into specific operational objectives for specific services, territories, or other related market- ing factors, all with specific established priorities. In order to be measurable, such objectives should provide precise, simple, quantifiable statements of who will be responsible to perform certain tasks within specific timeframes at various levels of performance. The objectives should also be feasible given internal resources and constraints and internally consistent with overall firm goals and objectives (Crompton & Lamb, 1986). Coal Formulation Intpoduction. In regards to the development of a marketing related Departmental mission statement, Peter Drucker (1973) indicated in his 25 text on management tasks and responsibilities that all organizations need to answer the following questions for themselves: 0 What is our business? 0 Who is the customer? 0 What is value to the customer? 0 What will our business be? 0 What should our business be? Although it appears simple, much has been written in marketing and management literature about the challenges associated with the organiza- tion's response to objectively answer the first of the questions. Kotler and Andreasen (1987) provide some guidance in approaching a mission statement by suggesting that nonprofit organizations focus on three dimensions: (1) Consumer groups-~Who is to be served and satisfied. (2) Consumer needs--What is to be satisfied. (3) Technologies-~How consumer needs are to be satisfied. Kotler also suggests that a mission statement be feasible, motivating, and distinctive. Howard and Crompton (1980) suggest that a municipal recreation and park agency's failure often can be traced to its neglect of the basic wants and desires of its potential consumers. The essence of the marketing concept, they indicate, is to focus upon the wants of poten- tial consumers of recreation and park services whenever decisions regarding an agency's programs, services, their prices, location, and promotion are being considered. 26 Howard and Crompton (1980) stated: The marketing orientation is a state of mind appropriate for all recreation and park agencies regardless of size or the particular emphasis of their programs...the critical question is "What do potential client groups want or desire?...market- ing is more than a set of add-on activities; it is a whole new attitude toward the agency's various publics and its goals. (p. 309) A marketing oriented agency defines its business in terms of benefits its customer or client groups want. A market-driven department has to answer for itself the question, "What business are we in?" The answer to this important question will become the foundation which will guide all future departmental marketing actions. Citizens don't buy programs or services; they buy the expectations of benefits. Programs themselves are not marketable. Only their benefits have a value to client groups. A service or program is simply a vehicle for the user benefits that it conveys. Therefore, a Parks and Recreation Department is challenged to define its business not in terms of specific services or programs, but with meeting client group wants. This is a particularly challenging concept to a department, as in the case study agency, which has tradi- tionally focused its energies on trying to maintain quality services in light of continuing financial constraints. In trying to convert manage- ment philosophy over to a market-driven approach, it becomes an easy trap to think of user benefits which can be facilitated through tradi- tional services offered over the years as constrained by available resources. Whereas a more appropriate strategy would be to ask itself, "What is the best way the Department can facilitate the provision of leisure benefits sought by the community, given the community and Departmental resources available?" 27 Crompton and Lamb (1986) suggest four reasons or advantages for answering the question, "What business are you in?", in terms of client benefits: 1. Insures appropriate focus on client group and prevents pre- occupation with programs or services which meet the agency's internal needs. 2. It encourages innovation and creativity through recognition that there are many ways to service similar client group wants. 3. Better assures relevant services if the department becomes aware of its need to continue monitoring client group wants as they change over time and space. 4. It will likely lead to a broader definition of a department's role, assuring a better match of services provided with client group needs (Crompton & Lamb, 1986). Chapter 4 includes a review of goal formulation and objective setting activity implemented during the case study. Establishing Core Marketing Strategy The next step in the strategic planning process is to develop a set of core marketing strategies to achieve the marketing goals and objectives. The core marketing strategy is the completion of the organizational portfolio assessment and identification of portfolio improvement strategies, the selection of target market(s), the choice of a competitive position, and the development of an effective marketing mix to reach and serve the chosen customers (Crompton & Lamb, 1986; Kotler, 1984; Newbould, 1983). 28 The Poptfolio Assessment The portfolio concept assumes that most modern service firms offer multiple products or services in multiple markets and are constantly facing questions of how to treat simultaneously these sets of existing and potential services. If interested in building opportunities, questions are focused on which services to pour additional resources into because their future looks bright. If the focus is on holding opportunities, examination is placed on which services to essentially maintain in their present posture because they are doing fine. Harvesting opportunity objectives require looking at which services to drain resources from because they are not promising. In contrast, divesting opportunities requires determining which services to drop because their future doesn't look promising or because other service prospects look better. New service opportunities require examination of which services to add to the portfolio over the planning period (Kotler, 1984). Target Markets The next step is the selection of target markets. A market is the set of all people who have an actual or potential interest in an exchange and the ability to complete it (Kotler & Andreasen, 1987). The process through which a market is studied, broken down into groups, and a target market selected is known as market analysis and segmentation (Johnson et al., 1986; Kotler & Andreasen, 1987). This concept has only been recognized within the last decade as an important management concept for governmental public service agencies. Given changing, more demanding and discriminating public demands, public 29 service agencies have come to realize that attempting to provide standardized, homogeneous programs, equally distributed and offered at uniform prices (lowest common denominator approach to service delivery), is no longer acceptable. Today, customer satisfaction is only achieved by developing marketing mixes geared to what specific consumer groups want . A marketing manager must determine the basis on which an organiza- tional market can be best segmented. Secondly, profiles of resulting segments must be identified and their attractiveness assessed. Finally, specific marketing mix strategies must be targeted to meet the needs and wants of some or all identified segments. Mckoi Sogmontotion Tomot MorkoIIng I. Idontify ban: for . '4. Soloct tho Iorgot sogmonting tho morkot morkom) 2. Dovolop profiios of 5. Dovolop positioning for faulting sogmonn ooch Iago: morkot 3. Dovolop moosuros of _ 6. Dovolop maltoIing mix sogmont ottroctivonou for ouch Iago: mako: Figure 2-2. Steps in Market Segmentation and Target Marketing. Source: Kotler & Andreasen (1987), p. 120. The above figure (Kotler & Andreasen, 1987) provides an overview of the steps involved in the two-stage market segmentation and target marketing process. Crompton and Lamb (1986) indicate that the challenge associated with segmentation for government agencies is to service those potential client groups to whom the most aggregate benefits can be delivered with the scarce resources that are available. These authors recognize that 30 resource allocation decisions among the segments are usually greatly influenced by the political environment and by decision makers' inter- pretation of what is equitable. Segmenting a market generally means subdividing it into homogeneous subsets of customers where any subset may conceivably be selected as a target market. While the concept is simple enough, the act of segment- ing a market is quite complex and difficult. The practical problem stems more from the myriad of alternative bases on which customers can be segmented rather than a lack of possibilities (Frank, Massey, & Wind, 1972). Kotler and Andreasen (1987) suggest that nonprofit managers, in considering segmentation criteria, should note that in the final analysis, the following strategic decisions should be improved: (1) Quantity decisions: How much allocation of resources should be devoted to each segment, if any. (2) Quality decisions: How should each segment be approached in terms of specific offerings, communications, place of offer- ing, price, etc. (mix). (3) Timing decisions: When should specific marketing efforts be directed at particular segments. Howard and Crompton (1980) suggest that the segmentation process should begin in Park and Recreation agencies by identifying client groups who have different recreational preferences and may exhibit different levels of ability and willingness to participate in a particular recreation and park program. These group differences, they indicate, make it possible to identify and select those potential client groups most likely to be receptive of a particular program. 31 Howard and Crompton (1980) stated: Selection of potential client groups is a major decision which the recreation and park manager has to make, because it influences and often directly determines all of the ensuing decisions which must be made concerning types of services or programs, location, timing, pricing, and communication. (p. 338) Case study segmentation strategies, developed from the above models, are outlined in Chapter 4, Case Study Findings. Competitive Positioning Having selected its target market, the service agency will then have to develop its competitive position strategy vis-a-vis other related agencies serving the same target market. Competitive positioning is described as the art of developing and communicating meaningful differences between one's offer and those of competitors serving the same target market (Kotler & Andreasen, 1987). The key to competitive positioning is to understand how members of the target market evaluate and choose among competitive service agencies. To enhance the image of a particular service, a service provider may attempt to create a differential advantage or that something extra that makes the agency and its services seem unique or a little better than its competitors. It is often due to this perceived advantage that a loyal group of customers will prefer the company's services to those of competitors. A differential advantage may be the result of any part of the service agency's marketing program (application of the marketing mix) or it may result from user perceptions of the personal elements of the service. Often, service agencies build on users' perceptions and try to create or reinforce a differential advantage through the use of 32 promotional activities (Friedman, 1991; Johnson et al., 1986; Kotler & Barick, 1991). The Marketing Mix The next step in preparing a marketing strategy is to develop a marketing mix and supportive funding level that enhances the service firm's ability to compete in the target market. The marketing mix is the particular blend of controllable marketing variables that the firm uses to achieve its objectives in the target market (Kotler, 1984; Shapiro, 1985). Although many variables make up the marketing mix, the basic four P5 of marketing, discussed earlier, are usually referenced in this context. The thrust of a service firm's marketing mix is to create a differential advantage established with the help of an effective marketing strategy, through the planning of a marketing program that will meet the needs of the service firm's target market. Another role of the service marketing mix involves making the service appear more tangible. This should also acquaint potential customers with the features and benefits of tangible services (Thiemann, 1986). Designing and Planning Organizational Systems Market planning organization should be viewed as an extension of the firm's existing planning process. Recognition and acceptance of the marketing concept by service businesses have led to organizational changes that place increased emphasis on identifying and satisfying customers' needs. As a service organization develops experience with market planning, it will go through three phases of organizational development: (a) introduction or initiation phase, (b) growth or 33 development phase, and (c) maturity or implementation phase (Kotler & Andreasen, 1987). Introductory Phase The introductory phase involves those activities associated with the introduction of market planning as an innovation by change agents from within or outside the organization. Chapter 4 provides additional insights on strategies for introducing strategic market planning in a public leisure service agency as developed from study findings. Growth Phase In the growth or development phase following marketing's introduc- tion, attempts are made to expand marketing's role and formalize its position in the organization. Often this involves formalizing marketing as a staff function coordinating programs and providing advice to others. Over time, it may be changed into a specific line function with its own staff that is responsible for specific program areas and related marketing objective performance (Johnson et al., 1986). Mature Phase The mature or implementation phase is identified by the transition of marketing from being a special function to becoming an on-going planning operation having top-level management support. By this phase, the marketing philosophy has reached most of the key management personnel and has been accepted as an appropriate method for performing services. Focus has shifted away from how to create a marketing plan or what organizational structures and related systems are needed to develop marketing strategies and has focused on how to market well to create 34 differential advantages and accomplish marketing objectives (Gummessen, 1991; Kotler & Andreasen, 1987). The Strategic Choice The leisure services market is mature in nature with a growing number of nonprofit and private sector agencies and firms competing with public Park and Recreation agencies for market share (public participa- tion and related revenues). Although most managers do not see them- selves competing for market share, being generally funded through public tax subsidies, many recognize that continued public support of their agency's programs is dependent on community perceptions of the need for and quality of their services. In such a competitive environment, it is essential that a public leisure service agency carefully determine appropriate marketing goals and objectives and match these with an appropriate organizational structure needed to implement the goals and objectives using the appro- priate core marketing strategies. This process of matching marketing goals, organizational structure, and core marketing strategies is the basis of what may be called the "strategic choice" model of the organi- zation (Schaffer, 1986). In essence, the model states that agency performance is largely the outcome of a series of choices made by top departmental managers. These managers, in conjunction with market planning support teams (see Chapter 4), must assess the market environ- ment of the agency's chosen program services and target markets and choose the appropriate core marketing strategies. Then they must create an organizational structure that properly supports those strategies. 35 If retrenchment and tight control or increased centralization of authority and responsibility is consistent with new marketing strategies, then top managers should limit the exercise of discretion by subordinates and hold most of the decision-making authority in their hands (by requiring program managers to refer all but the most routine matters to higher levels). On the other hand, an agency that seeks to exploit new markets or market segments might assign program managers "fuzzy" responsibilities and give them wide decision-making scope so they quickly take advantage of market changes. The choice of marketing strategies and structures, as in the identification of marketing goals and objectives, is not a one-time event because the market environment is dynamic. Therefore public leisure service agencies must continuously engage in matching their core marketing strategies and organizational structures to the agency's changing marketing goals and objectives. This cycle of adaptation is reflected in Figure 2-3 which is adapted from Schaffer (1986). As community conditions change, top agency management must review the question of exactly how to best serve its targeted market segments. Then management must adjust its core marketing strategies to the new marketing environment and make sure its organizational structure and related processes fit the revised strategies. Getting Started In getting organized to initiate the strategic market planning process, one alternative approach is to build a team made up of those managers who control and are responsible for the resources needed by the service marketer. Involving such organizational members and making them 36 Choice of services, target markets, level of competition, image W e 'es Degree of centralization, use Marketing orientations and of outside services, long- vs. policies, supportive short-term planning strategies resources, and plan imple- mentation effectiveness Figure 2-3. Organizational Structure — Cycle of Adaptation. Source: Adapted from Schaffer (1986). part of the initiation market task force can eliminate or reduce surprises or lack of cooperation later on. It is important for the service marketer (change agent) to provide clear role definitions, explaining why people are on the team and what is expected of them in terms of participation and decision. The major challenge is to keep the team and its individual members focused on the objectives of the process, the general game plan that's being used, and their expected and needed contribution. This involves keeping the process moving, keeping the players actively and effectively involved, making certain that everyone has a chance to be heard, seeking agreement rather than consensus, and getting decisions made within the team about the recommendations being made through the construction of the plan. A general game plan or sequence of steps is needed by the service marketer that will achieve the desired outcome of a strong strategic plan. Figure 2-4 (Pessetti, 1991) provides one perspective of the basic development situations which reflect different levels of change which 37 Cmmmmu NmN Ekbflu 1mm New Total Te:m Team Directed Subteams vamo mammd Subteams . . + Subteams EXIstIng Total ‘Rmm Figure 2-4. Strategic Planning Game Plans. Source: Pessetti (1991), p. 63. may need to be accomplished, often depending on the current level of market readiness. If the game plan is focused more to adjustments or fine-tuning of existing program services, individuals or small subteams most familiar with the technical or operational aspects of the changes will be most effective, with the larger team serving as a sounding board and coordinating device. Focus on providing new services to existing customers or offering existing services to new customers will require a balance between large team and subgroup activity. Initially, there will be much new information for everyone to create, learn, and communicate so large team functions will often dominate. The smaller subgroups are important in creating specific program details that can be presented as needed to the larger group (Pessetti, 1991). 38 The Marketing Orientation Process The beginnings. Initial public leisure service agency interest for consideration of incorporating marketing planning is likely to be generated within one of three groups: 0 top departmental managers 0 advisory boards - elected officials O middle-level departmental staff No matter where it begins, success in initiation of the process will likely only come about after all three of these groups are "sold" on its merits. To start the process, leadership within one of these groups must be demonstrated by first selling the concept to peers for purposes of organizing a formal or informal task force or committee. This task force would then have as its major objective the internal selling of the concept to members of all three groups. There will likely be major political consequences associated with the process along with potential major policy, organizational, and procedural changes. As the process develops, key changes may be required in managerial responsibility and accountability. All three of these groups are likely to be impacted and their support will be essential. Elected officials are the final policy decision makers and, as will be discussed, major policy changes may be required to support the marketing conversion process. Agency advisory boards or commissions often hold the key to influencing the decisions made by elected officials. Top departmental managers are the gatekeepers who control access to these groups and will be depended on to provide long-term general direction for the process. Mid-level agency operating staff 39 must perceive and believe that the agency director and top senior managers are personally committed to the process. To successfully sell the concept to all three groups, the above identified task force must recognize that it must be prepared to answer for each group the question, "What's in it for me?" The answers will be somewhat different for each. For example, for top-level managers, some of the long-term benefits of strategic market planning may include: 0 Increased resources which can be used to support highly visible and politically sensitive programs 0 Potential increased public service without requirement of new taxes 0 Enhance reputation as a modern public agency manager 0 Increased staff incentives to offer high quality, relevant services As for political groups such as the Advisory or Legislative Boards or elected public officials, benefits may include: 0 Increased voter support due to improved services at potentially lower tax support levels 0 Greater visibility of public Park and Recreation services within the community 0 Reduced impact of tax cuts To be successful in getting the department or agency started in the right direction, it will be important for the initiation marketing task force to focus its efforts on individual answers to the motivational questions that will be asked. Initial concept selling should be based on personal, small group discussions at first. Near total agency support will be essential, and a marketing ethic must prevail throughout 40 the organization. Well developed initial selling strategies should be targeted to remove known or anticipated resistance. Many of the project initiation challenges associated with the case study agency, as will be discussed in Chapter 4, were due to the failure to address the motivational questions for all three of the above referenced groups. Initial project interest was supported by key individuals in both the Legislative Board and top management levels. Yet, there was no effort undertaken early in the conversion process to broaden support to all three levels. The Department Director appeared in theory to support the marketing planning concept but resource alloca- tion and management decisions undertaken throughout the study suggested less than priority commitment to the conversion process. It is important to recognize that the conversion undertaking may require, if approached comprehensively, a major overhaul of most, if not all, management activities and strategies. Such undertakings must be given serious consideration and require a long-term management commit— ment and focus to be successful. Many short-term program capacities may require curtailment during the conversion to provide opportunity for long-term program expansion or quality improvement. Establishing the base criteria. It is recognized that at the beginning, there may be a temptation on the part of the initiation marketing task force to plunge ahead quickly into several marketing oriented projects. Implementation of short-term marketing strategies using demonstration projects is not unusual. Often projects are selected which have anticipated potential for producing quick results in terms of increased enrollments or revenues. This type of approach fails to recognize that a comprehensive marketing strategy for the entire 41 agency can only be successful over the long run after the organization has achieved a certain level of "market readiness." The task force must determine an appropriate criteria base for evaluating the success of its early marketing strategies. The task force needs to obtain increased staff, managerial, and political support. As a consequence of establishing initial credibility, momentum will build and likely feed itself through the continued investment of additional organization resources. Moving too fast in limited program areas may isolate supportive groups and fail to mobilize the agency staff. Yet, as errors and inefficiencies are often part of any learning process, waiting to initiate any marketing program activities until total market readiness is achieved may kill early initiatives. The middle area of this continuum must be determined by the task force after they examine the current status of agency market readiness. Criteria for successful market planning performance for leisure service agencies can be objectively measured in a number of ways. Three suggestive criteria include: (a) increased public awareness, use, and support of agency programs and services; (b) increased operating revenues; and (c) decreased operating costs. All three measurable objectives associated with more effective and efficient service management are just a few of the potential outcomes of successful marketing. It is a personal observation that a number of public leisure service agencies have looked at marketing, and other private sector management practices, primarily as a means of increasing operating revenues. This single focus on revenue generation may distort the objective of leisure services marketing. That is, to improve the overall quality of leisure services made available to the community by 42 the agency. Improved marketing of existing programs is likely, in and of itself, to generate surplus organizational resources which can then be used to expand or establish new program services. Therefore, it becomes critical that the initiation marketing task force develop a reasonable and balanced criteria set which will be used to evaluate market effectiveness. It is recommended that the above three variables be considered. Greater emphasis on net revenue generation may be placed on programs targeted for higher income groups while improved program "cost-per-user" ratios may be given greater weight for highly subsidized programs targeted for less responsive target markets. The task force will also need to examine the agency's capability to generate needed market planning monitoring and control information. In the short run, the task force will need to develop supporting data to help with the internal selling of the marketing concept. The type of data that are collected will be greatly dependent on the evaluation criteria selected. In the long run, one of the most essential elements of market readiness is the development of a marketing information system which will support the initiation, monitoring, and control of agency marketing plans. A remaining issue not discussed in this section, which must be addressed by the initiation marketing task force, is that of establish- ing a marketing program implementation time frame. Of key importance will be the current political and financial environment of the agency and its influence on establishing a level of urgency. Again, as suggested earlier, agencies experiencing recent major tax cuts may be looking for quick marketing fixes to generate new, desperately needed, revenues. Such short-term objectives and evaluation criteria may lead 43 to long-term failures in establishing minimal levels of market readi- ness. Key variables which must be examined are: the known levels of internal resistance within the three internal groups (top managers, advisory/legislative boards, mid-level departmental staff) and the existing levels of management and staff experience, knowledge, and application of marketing. Higher levels of incorrect information (misconceptions of what marketing is and does) are likely to require longer time periods of staff education than little to no knowledge. The effective use of marketing information systems, as noted above, will be required for market implementation. Task force members should also look for windows of opportunity to expand their support base for marketing. For example, opportunities to initiate new Advisory Board members or new staff managers should be considered. The orientation sessions for seasonal staff might provide incentives for part-time staff to become actively involved in generating needed market research data. Good task force planning will be required to take timely advantage of such oppor- tunities. Market Strategy Implementation, Assessment, and Control Marketing plans and programs will only work if they are properly managed and implemented. A shelf document, no matter how well prepared, has little value. When the prior planning steps have been accomplished and specific action tasks are defined, the deadlines for these activities established, and the monitoring and control points have been put in place, the organization becomes ready to move forward. The primary objective for service marketers in implementing planning is to identify the functions involved, develop detailed plans for the roles 44 they play, and manage the needed relationships and cooperation among functions that support successful operation and satisfied customers (Johnson et al., 1986). Implementation Pessetti (1991) identifies a seven-step strategy for market planning implementation. These steps involve: (1) expanding the team, (2) setting the stage, (3) outlining the strategic plan, (4) developing the implementation proposal, (5) consolidating the proposal, (6) finalizing the plan, and (7) executing. A general key to success for service marketers will be their ability to influence empowerment of the people in the organization who serve the customer to execute the planning strategy. This empowerment can be evidenced by the organiza- tional commitment to both the satisfaction of the customer and the development of its own work forces by making available the opportunities and resources that allow them both to see a return on the investment they are asked to make. Magketipg Assessment and Control The purpose of marketing assessment and control is to maximize the probability that the organization will achieve both its short- and long- range goals and objectives in the marketplace. As suggested earlier, these assessment or evaluation and control systems are an intrinsic part of the market planning process since they permit crucial and timely adjustments in marketing strategies needed to respond to change (Kotler & Andreasen, 1987). A marketing performance assessment and control system is basically designed using the principles of the MEG or management-by-objectives 45 program. That is, top agency management, utilizing the recommendations of its marketing teams, start the process by developing the "sales," "revenues," "costs," or other aggregate goals for a planning period which are broken down into subgoals for lower agency functional levels. During the planning period, managers at several levels receive and obtain information that allows them to follow whatever their subordinates are reaching their individual or unit goals. If not, management works internally to identify and implement corrective actions (Hise, 1977; Kotler, 1984). Effectiveness measures might include such objective data as sales or attendance, revenues and costs per user or per comparative time periods, or user profiles. Various confirmation control devices such as mechanical observation devices, mystery customers, customer performance surveys, complaint systems, consumer panels, focus groups, consumer image surveys, and other tools are often used to verify internal staff generated reports (Crompton & Lamb, 1986). Strategies to review performance relative to competitive agencies are important in monitoring competitive advantage and positioning strategies. Financial sales ratios which examine total marketing expenses, staff levels, advertising, promotion, attendance, marketing research, and other related factors are often key elements in the annual market action plan control process (Kotler & Andreasen, 1987). On the long-term strategic level, marketing audits are an important tool in determining the effectiveness of short-term annual market plan implementation in effecting long-term strategic plan marketing mission, goals, and objectives (Johnson et al., 1986). 46 The need for timely, accurate, and adequate marketing information will require the use of an effective marketing information system (MIS) which involves the use of computer equipment to facilitate the overall data management process. Strategic Market Planning: A Process and Not an Event Market planning, as has been stressed throughout this section, starts and ends on the need to collect information on the changing internal and external environments of the organization and the effec- tiveness of marketing implementation on improving agency performance in meeting customer needs. Change is the only constant in the marketing process and one of the few things that service marketers can absolutely rely on. The strategic marketing planning process continually attempts to anticipate change and examine how the agency can best respond to it in order to hold or develop an advantage in the marketplace. There are uncontrollable factors in the agency's environments and competitors in agency markets, as well as target market needs, that insist on moving around and muddying up the water. The effectiveness of the on-going market planning process which allows the agency to monitor, evaluate, and adjust to change will determine a large part of the agency's ability to deliver consistently good results and survive in a growing competi- tive environment (Pessetti, 1991). CHAPTER 3 CASE STUDY IDENTIFICATION AND MARKETING ASSESSMENT I. Case Study/Agency Identification Emmi—Cm Chapter 3 is divided into two sections: The first section provides a brief introduction to the case study agency, the City of Fort Wayne, Department of Parks & Recreation (FW-DPR). It begins with a brief overview of several key environmental factors. This is followed with a more in-depth examination of the Department itself. This includes a review of its governing board, organizational structure, and associated public services, staff size, funding sources, and a brief introduction to management's perspective on planning. The second section provides a marketing assessment of the FW-DPR which is focused on limitations and constraints which influenced the proposed development of the Department's Strategic Marketing Plan (SPM). This background is provided for several reasons. First, it should allow for comparative analysis by other leisure service managers. It is assumed that a number of these constraints are likely to be found in many public leisure service agencies. Secondly, it provides the supportive basis for Chapter 4. Chapter 3 focuses on the major process elements which are considered, as a result of this study, to be important to a DPR in establishing a state of "market readiness." That is, not only to be able to write a comprehensive department-wide SMP, 47 48 but have in place the thinking, policies, and management systems needed to be able to implement, monitor, and control its marketing strategies on a continuing basis. The Case Study Agency - An Overview The City of Fort Waype The City of Fort Wayne is located in Allen County in northeast Indiana. Allen County, representing Fort Wayne and the surrounding metro-developed area, had a 1990 population estimated at 363,811 (U.S. Bureau of Census). Census data for 1980 reported an Allen County population at a little over 172,000. The population in this area has been relatively stable. The Fort Wayne area's employment structure shows that the largest sector of employment is manufacturing, followed by the service and retail trade sectors. Similar to national trends, Fort Wayne's labor force composition is relatively stable showing some increase in working women and working women with children under six. Due to its dependence on manufacturing, Fort Wayne has experienced some major fluctuations in unemployment levels. Local city planners predicted the following (Fort Wayne, 1983): Fort Wayne's heavy dependence on the manufacturing sector may cause a continuation of business and industry layoffs. This will keep the area below national averages in economic growth and at a somewhat higher level of unemployment. The growth of the labor force will be small, but service industry employment will increase. (p. 6) Several problems appear to have resulted from the great amount of development in the suburban fringe. In some areas, public facilities have been overburdened and duplication of some leisure services appears to have occurred. More businesses and people have located in the 49 suburbs. Increasing numbers of lower income families and elderly will likely continue to reside in the city. Housing stock in the city is aging, which will increase the demand for public services. Eventually, the city tax base will likely decline causing financial difficulties. Only city property owners pay taxes which are used for park main- tenance, yet many non-city residents regularly use the city parks free of charge. A fee exists for some facilities and programs, but often it doesn't defray operating costs. If this trend continues, more people will be using city parks without having to pay for any maintenance costs. An investigation of the housing characteristics of Fort Wayne shows that the number of rental housing units has steadily increased roughly 24% over the past 20 years. In 1980, about 35% of the total housing stock in Fort Wayne was renter occupied. Recreation amenities have become a tool to increase housing market- ability and competition. Swimming pools, tennis courts, golf courses, and playgrounds have all been used to appeal to prospective occupants. The Fort Wgyne Depgrtment of ngk§_§nd Recregtion (FW-DPR) Park Board. The Park Board system, used in Fort Wayne, partially evolved as a means for continuing responsible leadership and direction. The system was designed to help buffer the Department from the local political process. As an illustration of this point, the Departmental Director at the time of this study, who worked himself up through the Department, had been in office for the previous 16 years. The Board of Park Commissioners is appointed by the mayor to oversee the Department. The four member bipartisan board is selected 50 for 4—year terms each and serves without compensation as the governing authority for the Parks & Recreation Department. Organization and programming. The Department had an extremely flat organizational structure. From discussions with long-time employees, it appears that the organizational structure evolved as a response to a series of emerging public interests and needs. As new facilities (golf courses, gardens, the zoo, etc.) were developed, the organization was expanded and changed. As of 1987, the Department had five major divisions: parks, recreation, the zoo, business, and finance. All park property and facilities are maintained by the Division of Parks. The major services provided by the Division include the develop- ment, maintenance, and care of all municipal lands dedicated for park purposes. Also included is the maintenance of all park facilities and the planting, removal, and trimming of trees lining all public streets or in the parks. The Parks Division, which has been the historical mainstay of the Department, was subdivided into: lands and facilities, planning, horticulture, tree division, buildings and equipment, special services, and north and south area maintenance districts. The Recreation Division, the focal point for most of this study, was also subdivided into the following functional units: senior citizen center, recreation facilities, neighborhood services, theatre, day camp, community centers, athletics, golf courses, and special activities. Along with park sites, the Parks and Recreation Department operated several facilities for the community which attracted visitors from all over the region. The Fort Wayne Children's Zoo and African Veldt, the Foellinger-Freimann Botanical Conservatory, the Foellinger Theatre, and 51 the Senior Citizen Center together attracted over a half million people in 1985. Recreation programs and facilities managed by the Recreation Division also played an important role in the total mission of the Department. These programs and facilities, in addition to those noted above, included an ice arena, four golf courses, three tennis centers, and four municipal swimming pools, community education classes, a museum, recreation centers, a theatre, special activities, summer playground programs, and a day camp. The span of control for many of the Department managers had wide fluctuations due to the strategy of using large numbers of seasonal and part-time workers during the peak use summer months. This was even further exaggerated by the use of large numbers of volunteers in certain programs. Size of staff. The number of Departmental full-time permanent staff members had generally decreased in the years prior to the study. Due to increasing budget cuts and changes in service delivery, full-time employees dropped from 173 in 1980 to 135 in 1987. The increased use of volunteers and seasonal employees was necessary to supplement the peak work loads of the Department. For example, approximately 60 seasonal employees were carried during the winter months, increasing to about 270 seasonal employees during the summer. Sources of revenue. Fort Wayne's Department of Parks 8 Recreation has had a truly enviable history of financial backing from the community for developing and supporting its facilities and programs. The Foellinger Theatre, Friemann Square (a downtown, high density use, park area), the Senior Citizens Center, and the Botanical Conservatory are 52 some of the more outstanding facilities which have been funded either in part or in full by trusts, foundations, and individuals. These exemplify the citizenry's past support for the city's parks and recreation opportunities. This support was further demonstrated by strong local vote in favor of a $6.9 million bond issue passed in 1982. A brief review of the Department's economic history shows that it relies heavily upon income generated through city property taxes for its finances. From 1981 to 1986, the Department's total budget ranged from 75-65% dependency on a property tax millage allocated to parks and recreation. Personnel costs represented about 70% of total Departmental expenditures. The level of Departmental revenues from operations, generally achieved through facility and equipment rentals and program fees and charges, increased from about 25 to 33% of total revenues from 1981 to 1986. Over $13 million was spent on capital improvements between 1980 and 1987. Management orientation to plgppipg. Prior to the initiation of this study, the Fort Wayne DPR contracted the services of a management consultant group. This contract included a detailed assessment of major departmental functions and activities including examination of its operations and financial management programs, and a look at use of management information systems. The following quote is taken from the executive summary of the consultant's report (Moncrief et al., 1985). The Departmental administrative staff appears to be very hard working and very efficient, but one not utilizing some of the key administrative tools that will help the Department achieve state-of—the-art performance for the future. (p. 3) 53 This statement was further supported by another member of the consultant team who made the following observations in summarizing the results of his management studies (Moncrief et al., 1985): ...a disproportionate amount of executive time is being spent on short-range planning and almost daily fire-fighting of operational crises....a review of data shows only 7.6% of staff time is spent on long-range planning. The top management group reports that only 5% of staff time was spent on monitoring and evaluation of past performance. (p. 15) The failure to develop and incorporate many key management tools and information systems into the Department presented a serious handicap to the process of developing the SMP. As a result, the initial schedule for preparing the plan within the initial targeted time frame of a year proved to be overly optimistic. 54 II. Case Study/Marketing Assessment Introduction In formulating the appropriate design for a proposed marketing conversion process that is under consideration by a public leisure service agency, the agency needs to consider what its current state of market readiness is at the time of initiation. Also of importance is consideration of what the agency hopes to gain, both in the short and long term, from adopting market planning. This section of Chapter 3 begins by first making an assessment of the FW-DPR application of planning strategies. Following the recommended marketing audit framework provided in Chapter 2, a more detailed assessment of marketing limitations and constraints is provided. The last section of Chapter 3 briefly describes the marketing research efforts undertaken as part of the case study to further assess market conditions. Application of Planning Strategies Kotler and Andreasen (1987) suggest a framework which can be used to help evaluate an organization's use of formal planning systems. The framework includes the following series of evolutionary stages: 0 Unplanned Stage: Early stages of organizational initiation-- focus on daily survival with no planning staff. 0 Budgeting System Stage: Focus on a budgeting system to improve management of cash flow. 0 Project Planning Stage: Organization recognizes need for minimum planning staff to develop plans for specific, short-term projects. 55 o Annual Planning Stage: Management identifies need for annual planning system often using some form (top - down, bottom - up, goals down - plans up) of a management by objectives (MBO) system. o Long-range Planning Stage: Management recognizes the need to add long-range planning to improve the effectiveness of annual plans. This includes greater standardization of plan formats to allow for greater performance comparisons among organizational units. o Strategic Planning Stage: Management has recognized that the environment is full of probabilities, not certainties, and the long-term planning format is redesigned to provide for considera- tion and evaluation of alternative management strategies. At the time the case study project was initiated, the Fort Wayne DPR, from my perspective using the above framework, was somewhere between the annual and long-range planning stages. A first attempt had been undertaken just prior to this study to develop a comprehensive master plan for the DPR. An abbreviated format of a MBO system had also been recently developed but was not fully operational. This agency had a successful history, as would be likely in many DPRs, in developing a number of project plans for new parks and recreation facilities. This orientation to the planning process can pose a real challenge to con- verting to a market-driven system when considering the broad scope of changes which must be considered if a comprehensive market planning conversion is to be undertaken. 56 Marketing Assessment - Initiation Audit Chapter 2 included a review of recommended strategies for conduct of a market planning initiation audit. It was noted that data collection in support of the audit will likely come from internal and external interviews and secondary sources in addition to conduct of a series of market research studies. The following section is based on extensive examination of the case study agency. Marketing Assessment - Case Study Agency This section includes an examination of the limitations and con- straints identified throughout the study while working with the Fort Wayne Department of Parks and Recreation (FW-DPR). The section is structured by looking at policy, administration, and management constraints which were considered to be essential to the major marketing components or mix of program/services, place/distribution, price/fees and charges, and promotion (see Figure 3-1 which provides a framework for this analysis). Arbitrary distinctions were used to allocate elements as either policy or administrative-management. It was recog- nized that these elements are unique to this agency. It is assumed that different DPR levels, sizes, and experience and management styles would have a major impact on the elements reviewed. Resource constraints are only identified for program/services as no distinctions were made for need of additional supportive resources for remaining marketing mix elements. 57 nmrketlng e I emen ts : PROGRAM PLACE PRMTI 0N PRICE (personal (rev. (services) (distribution) selling object. inangt. advertising finan. elements: public rel“) nmngt.) POLICY ADVINISTRA TION MMNAGEVENT RESOURCES Figure 3-1. Framework of Key Components for Developing Market Readiness (establishing management systems which will support the development and implementation of SMP). Agency Limitations gnd Constrgints Policy Related Issues Program/services. (1) Departmental orientation to market planning. As suggested in Chapter 1, managers of the Fort Wayne DPR had a traditional orientation to the process of planning. Until the turn of the decade, the majority of DPR resources were devoted to the develop- ment and management of park and recreation facilities and spaces (parks). The Park Division had created and organized park and facility staff positions and management systems which became effective in gener- ating site development plans. Overall Departmental planning was generally limited to identifying and supporting priorities for proposed capital improvements. There was little integration and long-term planning associated with programming for public use within the parks and 58 facilities. From a marketing perspective, one can conclude that the Department had a Production Orientation. Prior to this study, the Department had not placed emphasis on identifying or assessing the leisure needs of the various public seg- ments of the Fort Wayne community. Departmental managers were hired and supported to provide traditional recreation services as considered appropriate by the Park Board and/or the department director. Just prior to implementation of this study, the Fort Wayne DPR had been involved in contracting services for obtaining a management audit. The performance of these contract services was product oriented (final reports) and were conducted with little staff involvement. This experi- ence, it's assumed, may have partially influenced the orientation of Department managers towards development of the proposed SMP. The Department prepared a federal grant proposal which called for develop- ment of a Departmental SMP within a 9-month time frame. This Depart- mental proposal was prepared before this study was initiated, and its underlying assumptions were that outside expertise could be secured to develop the SMP without the extensive support and use of staff time and Departmental resources. As suggested in Chapter 4, this assumption was false. As is highlighted through this section, there was little or no awareness of the constraints the Department would face in preparing and implementing a SMP. Departmental managers had, at this time, never experienced any problem in developing an agency plan or in having the internal management capabilities for being able to respond to plan recommendations. Lack of full awareness of the required resource commitment to develop a comprehensive SMP was related to the DPR's initial commitment 59 to the conversion process. Until Departmental managers developed a full understanding of the process requirements, they could not determine the level of priority commitment which they were willing to make. In addition to this lack of understanding, the FW-DPR had decided to include several nondirected Departmental program efforts during the study time period (see Section 8, Management of Nondirected Programs). These nondirected programs included planning and management of a state-operated project called the White River Games. Another included preliminary planning for a state-wide annual Park and Recreation Association Conference to be held in Fort Wayne. Already extremely limited staff time was committed to support these efforts, placing great stress on staff/time resources available to support the market planning process. (2) Equity/major marketing segments. A decision to allocate service resources in one area of the community or to one special interest group that has complained is also a decision not to allocate those services to another area or group. The Park Board, responsible for supporting all major DPR service allocations, did not have awareness of a formalized decision rules approach for resource allocation decisions. Lacking a systemized approach, Departmental services were primarily developed and focused along traditional lines. That is, services were focused in meeting the general leisure needs of Fort Wayne citizens as individuals. This orientation resulted in some lost market opportunities being developed for area groups, corporations, or tourists as other potential major market segments. (3) Mission statement. Appendix 1 includes the Department's 1986 philosophy statement. This is not a mission statement. The vision 60 described is not future oriented and focuses on supportive justification for the agency's existence. Informal supporting goals and objectives, prepared by the Department but not formally adopted at the time of this study, reflect support for continuing traditional leisure services. The objectives are not specific and generally not measurable. The Park Board and top Departmental managers had not formally addressed the future positioning strategy of the Department in terms of its role as a leisure service provider. Figure 3-2 (Howard & Crompton, 1980) provides a continuum which describes the various positions the Department can take in relationship to other community leisure service providers (competition). The Department can position itself as a direct provider of services, choosing to compete or not to compete in specific program or market segment areas. At the other extreme, the Department can take an outreach approach, delivering specialized services where gaps are recognized. There would be no direct competition with other leisure service agencies in this approach. eons MAXINJU UESUHE INNKNUIDWNES Figure 3-2. Three Alternate Approaches to Delivering Recreation and Park Services. Source: Howard & Crompton (1980), p. 236. 61 At the time of this study, the Department was basically serving as a direct provider, not specifically aware of or responding to competitive pressures. The impacts of competing services were generally considered only in the review and establishment of program fee schedules. The failure to identify a desired position resulted in problems in identifying other positions on: O targeting programs/market segments being serviced by others 0 willingness to use discriminatory pricing 0 establishing open criteria for evaluating department fees and charge schedules 0 desire to obtain nonreverting funding policy 0 willingness to establish enterprise funds. (4) Market segmentation/willingness to segment markets. Traditional approaches used by the Department to define program services by market segments was generally limited to sex and age groups. Male and female athletic programs, as an example, would be provided for elementary, junior high, and senior high school students. As the DPR internally imaged itself as attempting to provide "equal" services to all area residents, it had made no conscious attempt to prioritize services to gpy general or specific market segment. Lacking access to computer supported data bases, the DPR managers had limited documentation and user profiles for their various programs. Many recreational programs required registration forms which were often discarded at program termination. Although previous management effort was focused on the need for a standardized program registration form which could provide useful user profiles, it had not been finalized at the time of this study. 62 Top agency managers, as a result of the market training sessions, were able to understand the need for market segmentation strategies. Yet, there was general discomfort associated with publicly committing to allocating priorities to relatively specific community market segments. (5) Corporation sponsorship. The Fort Wayne DPR had established a precedent for securing special program sponsorship or co-sponsorship from area business. For example, a Sunday evening teen/youth concert was co-sponsored by a local rock radio station. The station paid for the bands and handled the promotion costs while the Department provided the area, supervision, and security. Yet, there was no supportive agency policy which dealt with issues identified by different Depart- mental managers who were being encouraged to seek out additional sponsorship opportunities. For example, questions were raised as to how far the Department should go in endorsing the sponsor, if a private corporation, in the Department's own promotion efforts. Should the corporation's logo be used on DPR flyers and TV promotions? Should the corporation be allowed to manage its own concessionaire operations at the event without monetary consideration back to the DPR? During early market planning team meetings, program managers expressed concern over their capacity to succeed in recruiting corporate sponsorships. They also expressed a need to centralize coordination to prevent "overkill" by the Department on specific corporate targets. (6) Use of nonprofits. A number of public leisure service agencies across the country have encouraged the development and use of nonprofit organizations as part of their management strategies. Nonprofits are used for a variety of leisure service functions. Examples include the operation and maintenance of specific parks and facilities as well as 63 the total management of specific program areas. Prior to the initiation of this study, the FW-DPR had limited involvement with nonprofit organizations. The Conservatory was partially maintained through the volunteer efforts of a group who, with the Department's support, organized themselves as a nonprofit. The Zoo also was supported by the Friends of the Zoo Foundation, which supported the facility by raising funds used to assist in providing new capital improvements and daily operating support. There was no general Departmental policy on when, how, or what conditions should be evaluated in considering establishment of or cooperation with a nonprofit. (7) Privatization. As with the above two strategies, a number of public DPRs have turned to increased use of privatization options as a response to public pressures for increased funding accountability. The principle applied here is that a public agency should examine all its major program functions to determine if service could be provided at acceptable levels with lower costs through the contracting of private firms. The FW-DPR had, at the time of the study, limited its use of this option to securing concessionaire services at several of its major facilities. These were primarily food and beverage related operations. Operating policies for establishing concessionaire contracts were established. The DPR had been considering the possibility of converting its golf course management staff over to a concessionaire operation. No action had been taken to pursue this option at the time of this study. Again, there was no general agency policy which directed or provided guidance of management consideration of this option as an alternative to provid- ing direct DPR program services. 64 (8) Management of nondirected programs. During the course of the study, a number of mid-level managers responsible for supervising or coordinating specific program or facility areas were assigned responsi- bility to provide management inputs for several major nondirected departmental programs. That is, programs which were not directly related to the functional area of managers' responsibility. There was no agency policy which directed agency management as to when and how such programs should be evaluated and prioritized for action by the Department. There was also general concern on the part of mid-managers as to how reduced performance associated with assigned program responsibilities would be evaluated in light of such nondirected program responsibilities. A similar situation occurred when DPR program/facility managers were asked to respond to requests for supportive services by both public and nonprofit leisure service related agencies. Such services would require management resource allocations which were not directed by position requirements and performance expectations. (9) Operation and maintenance support of program services. One of the many concerns expressed by DPR program managers during early market planning team meetings was the lack of operation and maintenance support of programmed services during evenings and weekends. Such activities as the temporary wiring of electrical boxes or the movement of seating bleachers required the skills and experience of key operation and maintenance staff. The Department had an on-call schedule in which off-duty operation and maintenance staff could be called in cases of emergency. There was no general policy related to how such situations should be handled when on-call people were not able to be reached. The 65 unionization of most operation and maintenance staff complicated the process and resulted in high staff costs when off-duty people were requested to provide services. The allocation of these extra service costs to a specific low-budgeted program provided a major source of frustration to program managers. (10) Use of alcoholic beverages. The Fort Wayne Park Board had established a general policy of not allowing use of alcoholic beverages on or in any park property with several specific exemptions. These exemptions at several facilities were not supported with defensible justifications. Many other programmable facilities, such as the theatre, offering many adult-oriented activities, were not considered acceptable by the Board for the serving of any alcoholic beverages. For some adult programs, such as an evening sing-a-long or country dance festival, loss of potential public use and related revenues was not considered in evaluating the merits of the arbitrary policy on alcohol. Placezdistribution of services. (1) Equity models/assessment of allocation decision making. Crompton (1986) has examined the various approaches used by governing boards of public leisure service agencies. He has noted from his research that most boards have no final policy or procedure when it comes to determining how service allocation decisions are made. Most board members often indicate that they believe that equality, or everyone in the community getting an equal share, is the guiding principle. Yet, assessments of actual service allocation patterns often show this not to be the case. The Fort Wayne Park Board falls into this mode. Service allocation assessments conducted prior to this study were generally limited to such fixed resource assets as parks and major facilities. As a result of 66 this study, the distribution of both facilities, parks and recreation programs where measured over 10 geographic zones. The results of this assessment identified several geographical areas which, in relative comparison, had received few DPR services. These distribution shortages in both public park acreage and programs were further noted by relating these low-service areas to geographic zones currently experiencing higher population growth. (2) Market segmentation/locational targeting. Managed as a generally traditional municipal DPR, Fort Wayne had not considered the need to modify program services to adjust to user needs as they changed in different community neighborhoods. Once a program was implemented, it would be standardized and offered at one or several locations at the same time of day and price, using similar packaging and promotion strategies. Pricelrevenue management. (1) Revenue goals and objectives. Prior to study initiation, Departmental managers and policy makers had taken a position of charging user fees and charges for some program services, facility, and equipment rentals. As indicated earlier, by 1986 the Department was about 30% self-sufficient. That is, operational revenues equaled about a third of its annual operating cost. Managers had established an informal agency goal of increasing this to about 80% over the next 3-5 years (1986-1990). As of 1986, the agency did not have a supporting nonreverting fund policy which meant that legally, all revenues collected by the Department were to be returned to general city revenue accounts. There was also not a prescribed Departmental policy or procedure for establishing or updating Departmental fee schedules. Board 67 decisions for specific fees brought to their attention by the staff were primarily based on incremental increases needed to support increased operating cost. Information regarding competitive pricing of private operators was also examined only in light of potential political ramifi- cations. Traditional discounts were available to senior citizens while other user incentives and discounts were not generally utilized. No clear distinction was made to segregate which types of programs or facility usage/rentals should have user fees. Nominal registration fees would be charged for participation in youth athletic programs while youth soccer leagues were being subsidized by allowing free use of park maintained sports fields. Progressively, the DPR had turned to a variety of options in the attempt to increase operating revenues. For example, the DPR collected revenues on: equipment and facility rentals, merchandizing, leasing of internal services, corporation sponsorships, use of a gift catalog, use of interest bearing accounts on Departmental balances, concessionaire contracts, and others. Yet, there was no revenue management plan which examined or prioritized staff support for each and all of these sources. As suggested above, managers tended to only link the concept of market planning and implementation to one revenue source, that of recreation activity program fees and charges. (2) Use of discriminatory/differential pricing. Standardized prices for program registrations or facility entrance fees or equipment rentals were set by the Board. The Board did not consider such variables as consumer demand distributions, ability to pay, availability of competing supply, etc. There was an inherent belief among many DPR 68 managers that it would be wrong to charge one segment of the community either more or less for the same "type" of service. There were some notable exceptions such as the varying prices for the four municipal golf courses, which were justified by the recognizable differences in course quality. Yet, there was some reluctance to carry over this approach when it came to examining pricing strategies for most recrea- tion programs and services. (3) Enterprise funding. A number of progressive Park and Recreation agencies across the country have utilized the private sector model of enterprise funding as a means of increasing productivity and public accountability. Program managers, for example, would be given near total budget authority and control for their enterprise area, be it aquatics, athletics, a zoo, whatever. These managers would then be evaluated partially on their budget performance. Generally, a non- reverting fund policy was also used in such agencies, where managers were given incentives to increase net revenues. By carrying over net revenues each year, managers were given a means to enhance future program service capacity. Again, as a traditional municipal DPR, Fort Wayne had no such policy. Program managers' performances were not directly linked to budget performance other than gross consideration of program-related cost controls. Mid—level managers had no significant control over budget allocations for capital improvements, program promotions, pricing strategies, etc. Without a Departmental policy on allocating fixed Operating costs to program service areas, there were basic inequities in how overhead costs were distributed. Top Departmental managers appeared to straddle the fence in their approach to budget management. There 69 appeared to be some interest in downward allocation of budget management responsibility but a reluctance to turn over major control, particularly in some areas. In return, most mid-level managers had not developed the skills and experience needed to assume greater budget management respon- sibilities. (4) Funding support for capital improvements. The annual operating budgets for the FW-DPR did not include allocations or set-a-side for capital facility or area improvements. Such supportive funding came primarily from two sources. The primary means was use of occasional (every 8-12 years) capital improvement bonding programs which would be supported by city administrators and received voter approval by Fort Wayne residents. A successful, secondary source was the support received from area corporations and trusts, and foundations. High public visibility projects, such as the Senior Center or the Conservatory, were constructed as a result of the public goodwill and the favorable image such projects returned to these community interests. The outcome of this general strategy was the failure to secure needed funding to support capital improvement needs associated with low visibility, generally traditional program services. For example, many of the DPR athletic program services had to be offered at facility locations rented, loaned, or otherwise secured from other agencies. This was due to the lack of DPR indoor sports facilities. Unable to compete with a growing number of special interest groups willing and able to pay higher rental fees, the athletic programs would often be moved annually from one location to another due to limited availability of facilities. 70 PromotionZThe mix. Basic strategy. With limited seasonal and part-time staff support, one DPR manager operated a public relations office. No DPR funds were allocated at the time of this study to support program advertising, incentives, or discounts. Although there had been some interest and discussion on establishing a DPR speakers group, no formal personal selling or promotional strategies had been developed. Again, as a traditional DPR, Fort Wayne tended to limit most of its promotional efforts to three approaches: (1) use of public service announcements (PSAs) in local media (radio, TV, press); (2) use of the seasonal DPR program brochures; and (3) use of limited posters, direct-mail flyers, and similar targeted information media. Discussed later in Chapter 4, one of the major findings of the marketing research carried out for this project was the general lack of public awareness of DPR program and services. The limited funding for other than PSAs made available to the public relations office was often spent on a first-come, first-served basis, with most dollars allocated for Department brochures. Program managers generally did not budget supportive costs for promotion, as a result of this confused policy. AdministrationZManagement Program(services. (l) Orientation to planning. As suggested earlier, the external management audits of the Department identified the lack of management time allocated to long-term planning. When seen in light of the externally flat organization structure, particularly in the recreation division, it's not surprising that crises management was the standard operating procedure (SOP). This management orientation is 71 consistent with the failure to establish essential management monitoring and control systems. The DPR did not have a system in which new program proposals were evaluated. Mid-level managers were given flexibility to try new programs if they could support them using existing resources. There also was no formal process for evaluating existing program performance. Therefore, programs were generally allowed to die slowly, extending the consumption of major resources which might have been used more effec- tively. (2) Organizational structure. Several major administrative functions were centralized at the main office and controlled by an informed team of five Departmental managers. These functions included among others, budget preparation, planning, draft policy development, accounting, and personnel management. Mid-level managers, as a conse- quence, had limited management control over the programming areas in which they were primarily employed to manage. For example, the theatre program manager would have control over his expenditures to provide direct services but not over the budget allocation for program promotion. These mixed levels of control allowed top managers increased flexibility in controlling funds and greatly limited program manager accountability associated with program performance. (3) Monitoring and control systems. Given the past long-term orientation towards the management of park spaces and facilities, the DPR's accounting system was geared towards cost controls with inter- action with mid-level program managers. Revenues, on the other hand, were controlled at a higher level, not allowing program management the option of monitoring program specific budget performance. For example, 72 costs for aquatic programs would include a cost account control number for learn-to-swim programs, but all revenues collected through aquatic programs were lumped together. The accounting system for most program areas did not allow for specific program evaluation, i.e., comparison of costs/revenues for the different age defined learn-to-swim programs. There was a 5- or 6-year history of discussion in the Department over the need to establish a management by objectives (MBO) system. Yet, as of the time of the study, no formal system had been adopted. The lack of measurable work performance objectives for office units or employees was consistent with the informal process used to evaluate staff performance. Annual staff evaluations were conducted informally and based primarily on perceptions of individual attitude and personal- ity traits. Budget preparation was traditionally based on a cost-plus approach. With minor exceptions, prior year programs and their allocated costs were carried forward with generally upward adjustments made for infla- tion and rising operating costs. External management audits included recommendations for the Department to consider utilizing a ZBB approach, or zero base budgeting system. This would require program prioritization and continual evaluation of performance using long- and short-term Departmental goals and objectives as the criteria base. Program performance was also not evaluated using a Department-wide system. Inputs were not formally obtained from program users and, as suggested below, financial performance was only superficially considered. No cross-program comparison ratios, such as cost per user or visitor, had been calculated. If the program was considered tradi- tionally acceptable, i.e., athletics, aquatics, playground oriented, it 73 was generally never considered for possible termination unless required by general Departmental cutbacks. (4) Program registration procedures. The Fort Wayne DPR handled the program registration process at the time of the study using traditional methods which are not time and cost effective. People had to stand in long lines as individual program managers handled paper and pencil procedures, writing out receipts and only accepting cash or personal checks as payments. Use of one of the many cost efficient program registration software packages available which would streamline the process had been discussed in the Department without follow-up action. (5) Front-office procedures. The main office area of the Depart- ment serves as the major public/agency interaction area. There was a front service desk but it was not staffed with personnel who were hired or trained specifically to deal with the public. Office managers, secretaries, and clerks, hired to perform other tasks but who work in the vicinity of the front desk, all did double duty in taking turns to interact with the public as the need arises. The office was only open to the public from 8:00 to 5:00 p.m, Monday-Friday. (6) Staff training and development. The Fort Wayne DPR did not have a systemized staff training and development program and had not employed or assigned any full-time personnel staff to this activity. Employee training and development was not generally considered in employee performance evaluation or in individual training plans. Special Departmental-wide training seminars were usually held on an annual basis and provided focus on specific management concerns which were of interest. As funding permitted, staff were occasionally able to 74 attend professional conferences and seminars. Yet, at the time of this study, only one of the 10 to 15 mid-level managers and two of the top departmental administrators were members of any professional Park & Recreation Associations. (7) Internal marketing. Informal communication systems in the Department needed to keep staff aware of changing Departmental policy and direction were extremely limited. Continual budget cutbacks over the previous decade had taken its toll on employee morale. Top Depart- mental administrators often did not involve mid-level managers in the decision-making process involving actions which often impacted the latter's program areas. Most staff were generally not invited to attend Board meetings and were not given access to Board members. As a result of this situation, many symptoms such as low staff morale, trust, and communications were identified during the course of the study. There were no formal procedures for recognizing staff performance (i.e., incentives and reward program) and no opportunity for staff or their families to participate in their own departmental programs free of charge. As there was little to no cross-program coordination or planning, staff were generally not aware of activities being planned or implemented within other office units. Staff uniforms and logos were experimented with, but there was no supporting formal policy resulting in inconsistency in implementation. Several program managers whose office locations were outside of the main office appeared to have much greater freedom and control of their program areas than those who worked under the same roof as Departmental administrators. (8) Coordination of volunteers. Due to continued budget cutbacks, a growing number of Departmental recreation programs had become 75 increasingly dependent on the use of volunteers. The Department did not establish a systematic approach to recruiting, selecting, training, and orienting volunteers. People who expressed an interest in providing volunteer services were often asked to contact specific program managers who may or may not have service needs at that specific time. There were no formal volunteer recognition or reward programs. In fact, in one program area highly dependent on volunteers, the volunteers themselves supported the cost of their own annual appreciation dinner. (9) Special events management. Special events or activities were being managed primarily along traditional programming lines. That is, special holiday events, like an Easter Egg Hunt or Halloween Haunted Forest, were planned to meet nonroutine programming needs. The special events manager also coordinated Departmental activities when it co- sponsored them in large community projects such as an annual Tri-Rivers Festival, which attracted people from a three-state area. Yet, all such Departmental activities were fully subsidized by Departmental funds. The many opportunities these special events offered to collect additional revenues through commissions from event entrance fees, concessionaire contracts for food and beverages, or retailing of related products, were not exploited. Beyond missed revenue opportunities, the Department also generally failed to use these large public gatherings as opportunities for cross-program promotions and publicity. Placeldistribution of services. Organizational structure. As indicated earlier, only the Operation and Maintenance Division of the Department had recognized the need to consider geographic distribution of its parks and facilities. Several regional operation and maintenance area offices were established to better allocate management control. As 76 suggested above, no prior consideration was made for the possible advantages which might occur for structuring the Recreation Division using either geographic or major market segment criteria. That is, area management of recreation programs for inner city vs. suburban areas or program management directed for teens, young adults, or preschoolers. The Senior Center did provide a single age group focus but generally limited program services to those provided on site. Price revenue mana ement. Integration of revenue objectives. The Fort Wayne DPR did not formally establish a profit center approach as a means of achieving its long-term revenue target of obtaining earnings of 80% of its operating budget. Until this study was initiated, revenue objectives were not formally identified for specific program, facility, or activity areas. Program managers had neither the control of budgets or the experience and training needed for full budget administration. Therefore, program and staff performance was not directly linked to revenue and cost management. In summary, the Department lacked the clear identification and integration of revenue objectives it would need to assure efficient management implementation of its revenue objectives. There was a clear need for the Department to develop consistent internal policy direction regarding revenue management. A management system, such as establishment of a revenue management team, was also needed to implement, monitor and control Departmental efforts. Marketing strategies would then be devised to meet revenue targets established for all revenue resources, including corporate sponsorships, facility rentals, concessionaire contracts, etc. Suggestions were also made to the Department as part of this study's market training program that an 77 internal marketing strategy be developed as a means of selling the Mayor and City Council on the need for a nonreverting funds policy. PromotionZThe mix. Establishment of promotional strategies. As a traditional public leisure service agency, the Fort Wayne DPR did not establish promotional objectives for specific programs or for specific markets. No policy or administrative procedures were organized to deal with paid advertising, user incentives and discounts, or effective personal selling strategies. Management responsibilities for program promotion were confused between program managers and the centralized controlled and funded public relations office. Lacking a clearly defined oriented mission statement, the Depart- ment had not identified a positioning image or theme on which to focus its public image. Several Departmental logos had been created over the history of the Department and were only generally seen on office stationery and brochures. Resources Introduction. The following Departmental resources, or more specifically, lack of these resources, within the Fort Wayne DPR were considered important in relation to key constraints associated with preparation of the strategic marketing plan (SMP). The shortage or absence of these resources influenced all aspects of the marketing mix. (1) Computer support. At the time this study was initiated, the Fort Wayne DPR had limited access to computer support systems. The Department had acquired one PC which was primarily used for internal accounting and budgeting purposes. Extremely limited staff access to the machine was focused on word processing of large reports. The 78 Department utilized city-owned and maintained main frame computer services in securing monthly financial statements for accounts which were monitored by city administration offices. A staff manager recently employed as a management information systems specialist had started to expand the use of computer support services into several new areas. This included inventory control and vehicle maintenance. (2) Trained staff. Generally, the Departmental staff did not include anyone who had prior knowledge or experience in the area of marketing. The Superintendent of Recreation had attended several marketing seminars and conferences and recognized some of the benefits which would accrue to the agency if it adopted a marketing planning program. Generally, most Departmental managers had little experience in long-range program planning, program budget administration, management of information systems, research, and other areas supportive of market- ing related tasks. Managers' job descriptions did not include any marketing related experience or knowledge. A recently employed market- ing specialist for the Department had no experience in public sector agencies. She had focused initial job efforts on developing highly targeted information bases in support of several short-term management decisions regarding planned facility improvements. In short, there was not strong internal leadership or direction available to support market planning studies. (3) Market research. Given the lack of computer support systems and staff knowledge and experience of marketing planning, there was, consequently, very little available historical or operational data needed to develop the SMP. Program, facility, and activity managers had only superficial knowledge of their users or visitors. User surveys had 79 generally not been conducted by the Department. Lack of research skills had greatly limited the quality of user studies that had been conducted for the agency by contract services providers. Lacking any prior market-related goals or objectives, the Department had not developed data bases or information systems which examined: which segments of the community were or were not being served; geographical allocation patterns of leisure services; or the perceptions of the community regarding the quality of services being provided or the priority of services desired. (4) Surplus staff and financial resources. The Department under- took the support of this study with the expectation of developing a Departmental Strategic Marketing Plan without the extensive use of staff time and with the limited financial resources made available through the Federal UPAAR grant (see Chapter 1). High administrative priority was given to the on-going conduct of existing program services and the management of several new nondirected programs. The Department had not anticipated or budgeted for additional staff, staff time, or other resource support preparation of the SMP. This resulted in generating increased stress on the part of the Departmental staff who were required to support the marketing planning process while maintaining priority on other Departmental activities. Costs associated with providing market- ing related inputs were generally taken from already stressed accounts. Market Research Assessment Studies The following section briefly identifies a number of market research studies conducted as part of the marketing environmental assessment process (see Chapter 4). These studies include both an 80 internal and external DPR image assessment, a DPR service distribution assessment, a community needs assessment, and a community service competitor assessment. Internal Staff Image Assessment A traditional market research activity includes conducting posi- tioning studies to determine how an existing firm or agency is currently perceived by targeted market segments. The results of such studies can be extremely valuable to agency management in developing marketing goals and prioritizing general long-term marketing strategies. Two image surveys were conducted as part of the Fort Wayne SMP process. One was concerned with how Departmental employees "saw" the Department in terms of strengths and weaknesses for a number of management-related attributes. The second was an external or community image assessment. Its focus was on examining how a number of community leaders viewed the Department. As part of the internal situation analysis, a survey of DPR staff was conducted during the summer of 1986. The purpose of the Departmental survey was to determine the staff's perceptions or images of the Department's strengths and weaknesses (see Appendix 2, Fort Wayne Internal Image Survey Form). In addition to examining the staff's perceptions on Departmental attributes, the survey was used to determine what the staff believed to be the Departmental mission and objectives. They were also asked if they felt that the mission of the Department was well understood. The survey techniques used to conduct the internal image assessment was relatively easy to administer and it generated useful findings consistent with its objectives. 81 Departmental Image in Community Before establishing a marketing position in the community, the Fort Wayne DPR needed some idea of how it is currently positioned as a leisure service provider. Lacking resources to conduct a full-scale community image assessment, several less direct measures were used in the conduct of this study. The first was the use of an image assessment survey form almost identical to the internal staff image assessment discussed above. Similar forms were used in order to provide comparison of internal and external Departmental images. The second measure used involved a limited number of survey ques- tions which were included in the community needs assessment survey discussed below. These questions addressed the public's perceptions about Departmental strengths and weaknesses, security concerns, and related factors. DPR Service Distribution Assessment Prior to conducting this study, the DPR had not fully examined how prior Departmental allocation decisions had impacted the distribution of. DPR services (parks, recreation programs/ facilities/activities) throughout the community. From a marketing perspective, it was important to examine how the distribution of agency services correlated to results of the macroenvironmental studies also undertaken as part of this study. A zonal map was developed for the greater Fort Wayne metro area. Ten zones were defined using such criteria as population size, age cohort profiles, household density, average household income, and 82 natural features (rivers, highways, bridges) which impacted on area characteristics. These zonal areas were then examined to inventory the leisure service opportunities provided in each by the DPR. When com- pared to the population studies which included projections broken out by these zones, immediate service gaps and deficiency areas became recog- nizable. Community Needs Assessment When designing the planning process for the Fort Wayne Strategic Marketing Plan, it became evident that feedback from the populace at large was needed in better determining priority needs for leisure services. Many local governments have conducted needs assessments to help determine public service priorities. Based upon a projected 15% response rate, 14,000 surveys were randomly distributed to households located among the 10 preidentified zones. The major significance in examining the findings of the CNA was the strong correlation of results with earlier studies. Prior Departmental management studies by outside consultants, the above mentioned image assessments, and preliminary outputs generated by the Marketing Planning Teams (see Chapter 4); all supported the conclusions developed from analysis of survey results. The marketing orientation of the CNA resulted in development of an extensive data base which has provided a good deal of guidance in identifying priorities for positioning strategies. 83 Assessment of Competing Community Leisure Service Providers (DPR Positioning Study) An important aspect of the external situation analysis was an attempt to identify the position of the Fort Wayne DPR in the community, that is, to identify its relationship to other agencies and organizations which provide similar leisure services. Given the broad scope of current park and recreation services provided by the Department, this "positioning" assessment proved to be a challenging task. The final revised instrument (see Appendix 5) was created for purposes of providing a basic organizational profile of competitor providers. Approximately 30 interviews of primary competitors were then conducted during the winter of 1986-87. m4 CASE STUDY MARKET PLANNING APPLICATIONS AND FINDINGS Introduction Chapter 4 is divided into two sections. The first section provides a summary description of the general application of the strategic market planning process developed for the case study agency. Implementation of any planning model requires an organization support system. Section I includes a description of the experimental market planning system that was developed to implement the strategic market planning process. This system had two parts. The first was the internal organization structure used to coordinate the activity of the staff. The second part was development of a market planning process to coordinate Departmental human resources with an on-going system of market planning. Section II provides a comprehensive examination of the key strategic market planning strategies that were applied or were designed to be applied for the case study. Also included are the major findings developed from these applications. Using the recommended strategies discussed in Chapter 2 on initia- tion procedures for the conversion process, Section II starts with a brief look at initiation strategies used by the Fort Wayne-Department of Parks and Recreation (FW-DPR). The remainder of Section II is divided into market planning strategies and findings which were completed as 84 85 part of the case study and those which were researched and designed or recommended for application but not implemented during the time period of the study. Explanation is provided in Section II regarding the limitations which prevented full implementation of these planning strategies. 1. Case Study Market Planning Applications Recommended Marketing Planning Systems Introduction A major effort undertaken as part of this project was the concep- tualization and implementation of a market planning management system within the Fort Wayne DPR. Emphasis was placed on the importance in having Departmental staff involvement in the preparation of the Depart- ment's strategic marketing plan (SMP). In Chapter 3 it was noted that the DPR had initial intentions of low staff involvement which needed to be changed. This was critical because without this involvement, it was realized there would be little commitment and support of plan recommen- dations. The following paragraphs briefly describe the system that was developed for the FW-DPR. One of the primary objectives of the recom- mended approach was the establishment of a system that would go beyond just the generation of outputs needed to develop the SMP. The system considered the need for on-going market planning activities in the form of annual marketing plans which would be used to implement the long-term marketing objectives established in the SMP. Profile of the FW-DPR Market Planning Management System The market planning management system discussed below was designed to operate at three different management levels. Figure 4-1 illustrates The Mayor | l The Park Board l ! Dept. Director Figure 4-1. 86 Market Planning Steering Committee I ! Market Planning Standing Committee Functional Market Planning Teams l I I | ! Individual Program/Facility Market Planning Teams Internal Market Planning Management System. 87 the recommended internal market planning management system. The first or highest level was the creation of an overseeing advisory group (Steering Committee), which would guide and direct the overall process. This group included non-Department representation and has the authority to approve some marketing activities while submitting recommendations for other, more significant actions, to the Park Board for approval. This group was called the Market Steering Committee (MSG). The second level of planning activity involved primarily the mid-level programming managers within the Department, grouped by function, into one of three market planning teams (MPT). The market planning teams were made up of staff members from specific programming areas and were assisted by four support staff positions who, as standing team members, served on all three market planning teams. The third level, not fully implemented during the course of this project, was the development of area or program specific market planning teams. These teams were made up of both Departmental staff and outside special interest group representa- tives. Figure 4-1 shows the relationship of the Market Steering Committee and the Market Planning Teams. Tables 4-2 and 4-3 summarize the major orientational differences in responsibility between these market planning groups. The primary responsibility of the Market Steering Committee (MSC) was to provide long-term implementation of periodic strategic marketing plans (SMPs). The SMPs would have 3- to 5-year time frames and would be utilized for establishing long-range marketing goals and objectives. These goal and objective statements would be structured to answer the question, "What does the Fort Wayne DPR intend to accomplish in the next 88 Table 4-1 Market Steering Committee (MSC) Responsibilities 1. Establish and up-date Departmental long-range and annual marketing mission statements, goals and objectives. 2. Priority review and ranking of market segments. 3. Determination of long-term and annual financial objectives. 4. Final review and recommendations to park board on annual review of the Departmental portfolio of services. 5. Monitor and approve recommendations from MPTs on: Long-range strategic marketing plans; Annual marketing plans; Annual marketing team budget requests. 6. Annual consideration and approval of: Staff performance standards; Incentives program; Marketing training program. 7. Review and approval of strategic market plans and annual market plans. 8. Annual restructuring of MPT(s) for preparation of annual market plan as needed. 89 Table 4-2 Market Planning Teams (MPT) Responsibilities (Long Term) Prepare and submit annual marketing plans (objectives and strategies) to MSC for approval on all programs assigned to team. Prepare and submit recommendations for M.B.O. work plan based on staff performance objectives for program/facility staff assigned to team. Develop and maintain cost efficient data base needed to support annual marketing plans. Includes submission of requests to MSC for conduct of marketing studies requiring resources beyond that available to the MPT team. Prepare and submit recommendations on draft SMPs to MSC. Organize team annual activity schedules and related functional respon- sibilities. Prepare annual summaries of team recommendations on draft annual market plans assigned to team and prepare formal presentations of same to the MSC. Coordinate necessary revisions to annual marketing plans based on MSC input and submit final annual marketing plans for approval. Prepare annual team recommendations on marketing related; organizational issues, employee performance standards, incentive awards, training, team budgets, etc. Provide, review, and comment on final Departmental SMPs. 90 3-5 years to fulfill its mission and how will it go about doing it?" The challenge was to provide sufficient long-term guidance which would prevent the Department from getting "bogged down" in short-term oriented marketing activities and priorities generated by the specific market planning teams (MPTs) when considering specific strategies or tactics. In effect then, the development of the long-term SMP by the Market Steering Committee provided a "top-down" management approach, establish- ing general direction to the market planning process. While the preparation of the annual marketing plans provided "bottom-up" manage- ment, assuring some flexibility in considering long-term objectives while meeting short-term programming needs. Figure 4-2 provides an overview of representation that was developed for membership on the MSC and the MPTs. Outside agency representation was considered important on the MSC to assure a balanced perspective in setting long-term marketing goals. Such representation was considered important in maintaining close coordination and coopera- tion with key DPR support groups. The provision of standing team members, as identified in Figure 4-2, on each of the market planning teams was to help assure overall Departmental coordination and direction of team activities. It was suggested that standing team membership would change as new market- ing support staff were added to the Department. The standing team members would help bridge the communication gap that would likely be generated between the MSC and MPTs. That is, the differences in focal length and levels of responsibility between these levels were expected to generate creative conflicts. Mid-level managers would be primarily concerned with identifying and implementing specific 91 MARKET STEERING COMMITTEE P & R Director Park Superintendent Recreation Superintendent Marketing Specialist (Exec. Sect.) Park Board Representative City Planning Representative MARKETING PLANNING TEAMS STANDING TEAM MEMBERS Recreation Superintendent Operation and Maintenance Supervisor Marketing Specialist Planning Specialist Public Relations Specialist Facilities Team Golf Courses Tennis Centers Campground Ice Arena 0 & M Rep. Figure 4-2. Programmed Facilities Tegm Theatre Conservatory Zoo 0 & M Rep. Active Recreation Team 1 Athletics Aquatics Cross-Country Skiing 0 & M Rep. Recreation Programming Team Special Activities Neighborhood Services Sr. Citizens Center Day Camp 0 & M Rep. Market Planning Committee/Team Representation. 92 marketing strategies and tactics focused on obtaining short-term objectives. The MSC, in theory, would be more concerned with for- mulating long-term goals and assessing compatibility of annual marketing strategies to these goals. As either administrative or support staff not directly involved in program implementation, the standing committee members would provide increased continuity in direction, cross-program information exchange, and a communication bridge between the market planning levels. The Market Steering Committee (MSC) Prior to its first formal meeting, several marketing orientation sessions were provided to MSC members to provide general guidance and understanding of the assigned tasks. Problems were initially encoun- tered in securing and maintaining representation from outside-Department targeted groups. Once the core group was established, it was eventually realized that it was difficult to create committee outputs given the time or availability constraints of most MSC members. In response, a support work team made up of primarily the MPT standing team members was utilized. This team prepared draft positions associated with several of the tasks identified above for review and approval by the full MSC. This shortcoming was not anticipated and must be considered in examining modifications to this approach. Initial challenges for the MSC was development of and establishing linkages between: a newly developed mission statement, long-term marketing goals and objectives, defined priority market segmentation strategies, and Departmental financial objectives. These tasks were required prior to developing a market- oriented programming portfolio for the Department. 93 The Markgt Planning Teams Table 4-2 provides a list of proposed MPT responsibilities. As with the MSC, a series of staff orientation sessions were conducted to explain the purpose and role of the MPTs in the market planning process. Prior to becoming members of the market planning teams, there had been little opportunity for formal communication and planning coopera- tion between the mid-level recreation program managers. Also, these managers had limited prior access to the Department's top management decision process. Consequently, much of the initial energy of these teams during the course of the study was focused on surfacing many internal program management problems for the first time in an organized process. Though such activity helped develop team communication and cooperation, it did result in diverting the team's resources away from its immediate tasks. These included the detailed investigation, analysis, and recommendations for change to all major program/facility areas assigned to the Teams. In addition to the standing committee members mentioned above, each team was assigned a mid-level operations and maintenance supervisor who was most familiar with the program/facility areas. This communication link with the Operation and Maintenance Division was considered impor- tant in assuring implementable planning recommendations. Table 4-3 lists the major short-term objectives that were developed for each MPT. The development of team assigned market plans to be recommended to the MSC was a critical element in the development of the SMP. The Market Steering Committee (MSC) was to review these plan recommendations in the light of marketing research findings mentioned earlier. Unexpected schedule delays in conducting these research 94 Table 4—3 Market Planning Teams (MPT) Major Team Responsibilities (Short Term) Prepare draft annual marketing plans for all programs assigned to the Team and submit for approval to MSC. Prepare and submit recommendations on the draft SMP to the MSC. Prepare and submit recommendations to the MSC on marketing team related staff performance objectives to be included in the MBO employee work plan. Also submit related recommendations on staff incentive awards. Develop and maintain cost efficient data bases needed to support the annual marketing plan process. This will include budget submissions to the MSC to secure funding for research requiring resources beyond that available to the team. Develop and submit recommendations for the annual staff market training program. studies combined with the constraints faced by the MPTs indicated above were generally responsible for the delay in the development of the Departmental SMP. Pro ram Facilit S ecific Market Plannin Teams MPTs It was proposed that the MPTs provide direction and coordination in the preparation of Departmental annual marketing plans. In the annual marketing plan, specific marketing strategies and tactics would be developed for each major Departmental programming area. That is, individual market plans would be developed for the zoo, senior center, picnic areas, the teen concerts, the neighborhood parks program, the day camp, the rivergreenway trail system, ice arena, etc. These program/facility specific marketing plans, in addition to setting short-term goals and objectives consistent with those within the SMP and 95 outlined in Table 4-4, would identify implementation strategies which would make up the annual marketing action plan. As with the MSC, it was recommended that outside Departmental team representation be obtained to assure a balanced marketing perspective. Table 4-5 provides a recommended list of representatives which was con- sidered in the formation of these teams. Many programming areas, like the ice arena, for example, have an active special interest group (Ice Skating Club) which should be contacted for volunteer representation on the team to prepare the (ice arena) marketing plan. Figure 4-3 shows the relationship of the Market Steering Committee and the Market Planning Teams. The market planning teams served as the organizational focus for new market training programs and the develop- ment of staff support systems in the process of learning and developing new marketing approaches to program management. The third level of planning, the formulation of program/facility/area specific market planning teams allowed program managers to take the new marketing concepts and apply them in an annual action plan process while taking advantage of resource support related to the specific program area. The SMP is concerned with the trade-offs between potential service/ facility offerings and available resources that balance the differing interests of the Department's publics. The scope of the annual market plans was action oriented and was designed to address the following implementation questions: 0 Which target markets will we serve? 0 What services or facilities should we offer them? 0 What fee should we charge, if any? Table 4-4 96 Prograszacility Specific Market Planning Teams (Short-Term_ Responsibilities) Program Analysis: For each (June-May) scheduled/desired program identify: *General: *Budget: Target Market Location of Service Publicity Strategies Projected visitation/enrollment by month Program benefits to users Estimated program allocated costs -Staff -Program 0 & M -Equipment/Supplies -Publicity -Other (to be identified) Proposed fees/charges schedule Estimated program revenues by month Estimated net program revenues/cost per month *Recommendations with Supportive Documentation 1. Program portfolio recommendations 2. Market research recommendations 1. Program portfolio recommendations: -What programs/services to: Delete Reduce Maintain Expand Introduce -Desired level of subsidy: Full subsidy Partial subsidy Break-even Revenue generation 2. Market research recommendations: -Program evaluations (staff/client) -Program budget analysis -User profiles - data bases 97 Table 4-5 ProgramZFacility Market Planning Team Representation *Program/Facility Manager *Key Program/Facility Staff *0 & M Representative *Depart. Support Staff: -Marketing -Planning -Accounting -Public Relations *Representation from Support/Interest Group(s) *Contracted Support Services *Others Market Steering 98 Committee Market Planning Long-Range Strategic Market Planning (3—5 years) Based on review of annual market plan performance and updated market research Team(s) Macro Level Market Steering Committee Market Planning Teams Generate departmental level long-term and annual marketing plans Annual Market Plgnning Market/program specific marketing strategies for achieving long-range marketing objectives staged on annual basis Micro Level Market Planning Team Program/Facility Team -Special interest support group -Specific market research and evaluation studies -Short-term marketing objectives -Specific market strategies Generate annual program/facility specific marketing plans Figure 4-3. Primary Market Planning Responsibilities by the MSC/MPTS. 99 0 How should the service offerings be distributed? 0 How should we communicate to target markets the benefits offered by these services? The Annual Market Planning Process Introduction The following discussion provides an overview of the proposed DPR annual market planning process which was to be used to develop the annual marketing plans. The process was based on the assumption that the Department had completed a SMP. The SMP would be required to provide the necessary guidance to review and critique the annual plans in terms of how well their implementation would achieve long-term marketing goals. Program/facility specific marketing plans do not necessarily have to be completed in full in order to implement the DPR annual marketing plan process. Given the large diversity of Departmental programs and the limited resources needed to develop complete marketing plans, a prioritizing schedule of plan development was necessary. Program managers would document in their annual action plan submissions the steps that would be taken towards development of later scheduled marketing plans. For example, the aquatics manager may require that research surveys be conducted for several active seasons prior to preparing marketing objectives for the aquatics program. The manager may schedule completion of an aquatics program marketing plan in 5 years. During this preparation period, this manager would submit in his/her MPT an action program identifying planning activities scheduled that year leading to the development of the aquatics marketing plan. The MSC, once it defined its market segment priorities and portfolio 100 financial objectives, would develop a long-term schedule for the development of complete program/facility marketing plans. With this process, each program manager would be adjusting his/her operational strategies based on available resources while others would be scheduled for later completion. Working in a team environment would help provide support and current process guidance to managers. They would learn from the experience of their peers. Figure 4-4 identifies the three market planning stages recommended for the annual marketing process: Stage I - Pre-Planning, Stage II - Plan Development, and Stage III - Action Phase. It also identifies the major activities to be undertaken in each of these three planning stages. The calendar months selected for each stage consider that the majority of Departmental programs are implemented during the warm weather months. Pre-Planning Stage (September-November) The Departmental annual market planning process would be initiated by the MSC from its review of how well the previous year's annual Departmental marketing plan was implemented. Also to be considered are the recommendations from the MPTs regarding desired marketing activities for the coming year. The MSC would prepare the annual Departmental marketing plan objectives. These objectives would establish the appropriate project scope for the forthcoming annual marketing plan. Existing MPTs would then be critiqued in light of these objectives to determine if changes in the number or make up of teams is necessary. Once reorganized, if necessary, the MPTs would then develop detailed activity schedules for the coming year to accomplish their plan 101 Pre- | Planning | Stage | Plan Development Stage I | | Action | Stage Pre-Planning Stage Project/ Scope Provided Market Planning Data Collection & Analysis Re-define scope Team Selected | | Marketing Activities Calendar Developed Figure 4-4. Develop Plan Plan Development Action Stage Negotiate Strategies | l Implementation l I Control Planning Stages Developed for the Market Planning Process. 102 objectives. This phase would also include initiation of all required marketing research efforts needed to support planned activities. Other steps undertaken in this stage, as shown in Table 4-6, include MSC review and approval of the year's; staff marketing performance MBO evaluation criteria, the related proposed staff incentives in support of the marketing objectives, and proposed MPT support budget requests. Figure 4-5 provides an overview of staged activity by planning team while Tables 4-6 through 4-8 provide a detailed summary of each major stage activities for both the MSC and MPTs. Plan Development Stage (November-February) Major activities incorporated in the plan development stage include: the completion of all marketing studies initiated in Stage I, the re-examination of previously defined MSC annual marketing plan objectives in light of newly completed marketing studies to determine if modifications are needed, and the actual preparation of the annual marketing plan. Emphasis would be placed on both general core and program specific marketing strategies and action program components or tactics within the plan document. Other plan elements would be empha- sized as appropriate depending on where each program/facility area was situated in the development of their specific marketing plans. For example, once the Zoo Director has completed a zoo facility marketing plan which is supported by a detailed situation analysis, has estab- lished long-range marketing objectives, and has MSC approval on general marketing strategies, he or she only needs to include in the annual departmental marketing plan the specific marketing activities proposed 103 Table 4-6 Stage I: Pre-Planning Activity by MSCZMPTS MARKET STEERING COMMITTEE -establishes annual marketing priorities-objectives: *increase dept. revenues *cut specific program costs *increase new program enrollments *target new services to specific market groups *etc. -review previous annual M.P. staff performance/ program -establishes new staff performance incentives program standards -identifies MPT membership -reviews/approves MPT annual budget requests *Market Steering Committee - (MSC) *Market Planning Teams - (MPT) *Market Plan - (MP) MARKET PLANNING TEAM(S) -completes review of past year's marketing performance in light of M.P. objectives -recommends to MSC revised staff performance/incentives program STDs -prepares and recommends annual team operation recommendations for revised approval -provides coordination/input to MSC in the development of new annual M.P. objectives -identifies needed data collection efforts -develops MPT annual activities calendar: -inventory of steps in planning process -time line Stage I Pre-Planning |*Assignment of MPT | | members | |*Review/approval: | | -Staff performance | | criteria | | -MPT annual budget | | requirement | |*Annual MP objectives | | Setting objectives | |*Develop & recommend: I | -Annual MP objectives| | -Staff performance | | criteria I | -Staff incentive | | program | | -Annual MPT budget | | requirement | | (marketing research)| |*Establish MPT | l | activities calendgr 104 Stage II Plan Development *Review and approval of draft MP | Annual Market Plan | | Development | | --------------------- I |*Data collection &/or| | analysis |*Development/submis- sion of draft MP l l l | | | I 1 Stage III Action |*Monitoring and control of MP performance |Negotiation of Mar-l | keting Strategies | I ------------------- I |*Implementation of | | negotiated market-l | ing strategies _——__—___ Market Steering Committee Market Planning Teams - (M Annual Departmental Market - (MSC) PT) ing Plan - (MP) Figure 4-5. Market Planning Process: An Overview of Staged Activity by Planning Teams. 105 for implementation during the planning period. Table 4-7 provides an outline of major Stage II activities to be conducted by the MSC and MPTs. Action Stage (February-April) Activities undertaken in the action stage recognize that there is often a gap between the proposed marketing strategies which are desired and targeted in the plan development stage and what can actually be negotiated and implemented. Programming staff most often trade off desired marketing strategies when faced with unexpected contingencies in setting up seasonal operations. Unexpected facility repair costs, union labor negotiations, competitive agency activities, new technology; and a large number of other factors will influence the implementation of proposed marketing strategies. It is critically important that appropriate monitoring and control information systems be utilized to measure results and provide information necessary to determine what, if any, corrective actions are needed in this action phase. Table 4-8 provides an overview of Stage III activities. Market Planning Process - Summary The above sections describe the system of management teams which were organized for the case study agency. This system was established to provide both a vehicle for preparing the Department's first SMP and to implement its recommendations through use of an annual market planning process. The three levels of the system were designed to allow for a top-down management approach, establishing general direction to the market planning process. While the preparation of the annual marketin lans rovide "bottom-u " mana ement, assurin some 8 P P P 8 8 106 Table 4-7 Stage II; Plan Development Stage Activity by MSCZMPTs MARKET STEERING COMMITTEE MARKET PLANNING TEAMS -review and comment on MPT -conducts/contracts for recommendations for competition of budgeted re-scoping of the M.P. data and collection/ analysis efforts -review and approval of the draft M.P. -recommends changes to M.P. scope to MSC -prepares draft M.P. based on MSC response to recommended changes PLAN DEVELOPMENT: *DATA COLLECTION AND ANALYSIS: Situation Analysis- -background on past performance -opportunities and threats -strengths and weaknesses -forecasts -consumer profiles -identify attractive target markets/programs *RE-DEFINE SCOPE OF ANNUAL MARKETING PLAN: Review: -long-range marketing objectives -completion of previous M.P. objectives -situation analysis -recommended changes to scope of M.P. Identify Marketing Strategies: -product -price -place -promotion Prepare Draft M.P. Determine Budget for Strategy/Elements [Market Steering Committee - (MSC)] [Market Planning Teams - (MPT)] [Market Plan - (MP) ] 107 Table 4-8 Stage III: Action Stage Activitygby MSC/MPTs MARKET STEERING COMMITTEE MARKET PLANNING TEAM(S) FINAL NEGOTIATION OF ---- RECOMMENDED MARKETING STRATEGIES ---- -Monitoring and control -Implementation of of Market Plan performance marketing strategies PLAN DEVELOPMENT: -Negotiate Strategies: -delegate responsibilities for strategy elements -assure allocation of authority -define timetable -adjust annual MBO workplan -implement the plan -Monitoring and Control: -Measure results "What is happening?" -Analyze results "Why is it happening?" -Corrective action "What should be done about it?" 108 flexibility in considering long-term objectives while meeting short-term programming needs. The three-phase or stage annual market planning process provides a framework for implementing the long-term marketing strategies identified in the SMP. This is carried out through the continuous development, implementation, and monitoring of both Departmental-wide and program/ facility specific annual marketing action plans. The recommended strategy allows for the long-term scheduling of program/facility specific marketing plans to be prepared on a priority basis as resources allow. This approach provides for implementation of short-term market- ing strategies for all Departmental programs, with or without supportive marketing plans. Using long-term SMP umbrella guidance, annual market- ing activities can be evaluated by all team levels. The sharing and cooperation of team members working at different levels in the marketing plan process will provide opportunity for Departmental advancement towards meeting its long-range marketing goals and objectives. 109 II. Case Study Strategic Market Planning Strategies and Major Findings Introduction The major objective of this section is to identify and review what was determined to be key strategic market planning strategies. This strategy review is based on case study observations and exercises developed from research conducted as part of this study. The following market readiness strategies developed from case study findings are not reported as a definitive list or as final solutions. Additional research and study will be required to further examine these strategies and findings to determine their relative importance and contribution to the conversion process. These recommendations are addressed in the next chapter. Chapter 2 included a brief look at strategies that can be used to initiate the market planning process. This section begins with a brief look at the marketing orientation situation at the FW-DPR. It continues with discussion of key strategic market planning strategies which were implemented or recommended for implementation in establishing a state of comprehensive market readiness. The objective here was to describe what might be considered the "ideal" market planning model scaled for the agency size and scope of DPR operations at Fort Wayne. The Marketing Orientation Process The Fort Waype Experience As suggested in Chapter 3, Fort Wayne DPR administrators had initially anticipated production of a departmental strategic marketing plan within a year. It was expected that the SMP would be written with little input or support of existing departmental staff, and that once 110 the plan was written and approved, implementation of new marketing strategies would easily follow. None of these initial expectations was realized. At the time this study was initiated in the summer of 1986, the DPR had employed one full-time staff person assigned as a marketing specialist. Primary marketing support services were derived from nondesignated time from three staff specialists. One was the Depart- mental Planner, the second was the Public Relations Coordinator, and the last, the Management Information Systems Coordinator. No effort had been undertaken prior to this study to develop any marketing related plans. The Department had only recently developed its first long-term master plan which was primarily focused on capital improvement programs. Initially, many DPR managers looked at the proposed SMP as a master plan developed for recreation programs with the limited primary objective of increasing revenues. This early orientation created several image problems right from the beginning. First, operations and maintenance staff generally felt that they had no need for any involvement or support for the plan. Second, recreation staff who managed fully subsidized programs targeted to low income minority groups felt immedi- ately threatened. They anticipated greater pressures to increase revenues through higher fee schedules while fearing either loss of jobs or major cutbacks in their program areas. Strategic Market Planning Strategies The Strategic Market Planning Model Kotler (1984) developed a generic model for the strategic market planning (SMP) process outlined below in Figure 4-6. In his text on lll Environmnt Anal flit ‘ . Goal . ___ Sttotogy Organization _~ Systono Formulation Formulation Dosign Oosign Rom Anal pi: Figure 4-6. A Generic Strategic Market Planning Model. nonprofit marketing, Kotler sequences the preparation of a SMP following an organization's efforts to first establish the appropriate customer orientation involving the activities described earlier. Kotler (1984) refers to the SMP as a nested activity within the organization's strategic planning process, with long-term marketing focus undertaken at higher management levels, working down through the organization as strategies become more action specific and short-term oriented. Figure 4-6 was selected to serve as the base framework for developing the DPR-strategic marketing plan (SMP). Figure 4-7 identifies the further refinements made to the model early in the study process. They resulted from both a brief review of current department information sources and prior management studies and from in-depth discussions with top managers. Most marketing texts will usually indicate that market planning is not a linear process and often many planning activities involved in several stages are simultaneous and will influence both earlier and later planning assumptions and outcomes. This fluid, interactive planning process requires long-term management commitment and 112 MARKET RESEARCH Environmental Resource Analysis Analysis ! ! Internal Audit External Audit Internal External Review mangt. studies Environmental assess. Staff image Comm. Hist. program assess. Position analysis Media assess. leader. Staff program assess. Service area analysis image CNA Data Analysis I Goal Formation Identify marketing philosophy Mission statement Marketing goals and objectives Strategy Formulation Develop program portfolio analysis/strategy Identify program/market expansion strategies Identify marketing mix strategies | | Organizational Design Implement initial program/marketing staff training Examine options for staff incentives/awards program Identify needed changes to employee hiring process Examine proposed organizational structure for support of market planning activities I | Systems Design Identify needed marketing information systems: -Client participation -Market analysis -Market research Develop market planning management system Examine market control/feedback systems Refinements Made to the Generic Strategic Figure 4-7. Market Planning Model. 113 flexibility. Often assumptions or conditions determined early in the process will need to be changed, as well as consequent planning activities, as new data are generated or environmental conditions change. As indicated later, such was the experience in this study. Depending on the agency's state of market readiness, it could take anywhere from 1 to 5 years to prepare an effective SMP. Therefore, management must perceive the SMP as a continuing management activity generating interim products which are often outdated by the time they are printed. This is not a criticism of SMP planning, but an awareness that focus on the process (planning) is more important than that of any product (plan) generated by market planning. Figure 4-8 reflects the interactive nature of planning stages and the importance of modifying organizational design to meet the evolving supportive demands of the SMP process. Moving from the initial market planning orientation process, discussed in Chapter 2, to program or facility specific market planning teams would require continual organizational flexibility. This generalized model, placing organizational design ahead of goal formulation, reflects the need to first establish organizational structures to support the SMP process. These organizational structures were reviewed in Section I. The following material is divided into two subsections. The first is a review of those strategic marketing activities or strategies, in addition to those mentioned in Section I, which were fully implemented and completed during the course of the study. As indicated in Chapter 3, work completed as part of the case study project did not include completion of a Departmental SMP. Although a 114 Organizational Design Market Research Goal Formulation Strategy Formulation Systems Design Figure 4—8. Case Study General SMP Model. market planning management system and process was identified, and for the most part, initiated, actual planning studies had reached the stage of strategy formulation when my involvement with the study processes ended. Therefore, the section entitled "What Was Planned for Completion" emphasizes the recommended approaches established for the planning process and brief reviews of efforts completed using these procedures. What Strategic Market Planning Strategies Were Completed The following sections include discussion on marketing research, organizational structure development, and marketing goals and objective strategies completed during the course of the case study. 115 Marketing Research Figure 4-9 outlines the market research activities undertaken during the study and identified in Chapter 3. A brief review is provided of each in terms of the contributions each one made to the SMP process. The list of research studies shown in Figure 4-9 is not suggested as being comprehensive in nature. The degree to which an organization supports internal and external environmental and resource analysis will determine the type and scope of research that will be needed to support the development of a SMP. The broad range of market research activities undertaken as part of this study partially reflected both the limited support given by the study agency to planning in general, and its responsive orientation to the future. Environmental Resource Analysis -—— ——- .Analysis [—— Internal External Internal External Audit Audit Analysis Analysis Review of Macro environ- Staff image Community management mental assessment study image study studies Historical Department (media Community needs program position analysis assessment)* assessment assessment Staff program Service area assessment analysis *Planned but not implemented during study period. Figure 4—9. Case Study Market Research. 116 Environmental analysis. (1) The internal audit. The components of the internal audit of strengths and weaknesses of the case study agency included: a review of historical and current Departmental management studies conducted both internally and externally; a lO-year review of past and current Departmental services; and a staff review of all current programs and services being provided at the time of the study. As indicated in Chapter 3, the relatively quick growth in Depart- mental services in the early '805, generally due to ability to attract private sector and philanthropy support, resulted in the need to conduct a series of management studies to examine organizational impacts and appropriate response strategies. A careful review of such historical and recent management studies provided insight into how the Department was organized and much of the rationale behind the current policy positions and management structures. The historical, or lO-year, Departmental program assessment was focused on the broad scope of public services provided by the Department and how they changed over time. To conduct this assessment, a review was made of annual Departmental progress reports, revenue and cost performance records, past minutes of Departmental Board meetings, program visitation and usage records, available user studies, and other sources. To obtain a more current perspective on Departmental services, a detailed program assessment form was prepared and submitted for comple- tion to all Departmental managers having direct service supervision or management responsibility. This included park maintenance supervisors, programmed facility and recreation program managers. Data were sought on current user profiles, activity schedules and locations, related 117 program usage, cost and revenue estimates, pricing and promotion strategies, number of staff, current management problems, challenges, and recommendations for the future. The staff program assessments were conducted early in the study prior to the formation of market planning teams. The preparation of a common data base helped in the team formulation process by providing each team member with a common reference point in which to discuss strengths and weaknesses of their programs developed from personal study. (2) The external audit. A macro environmental assessment was conducted which examined both past trends and future projections in social/demographics, politics and government, technology and industry. Demographic profiles included individual and household data on income, unemployment, employment, population by age groups, and projections of populations both by age groups and service area zones. Where available, figures were developed for comparative purposes on a city, township, country, and state-wide basis. The profiles provided a needed comprehensive assessment of major macro-level environmental factors which have and will continue to influence the Department's programs and the markets it serves. A secondary but important part of the macro environmental assess- ment included an inventory of information sources which were identified for purposes of supporting future Departmental environmental monitoring research efforts. Strategies, including the need to establish mutual information links having shared organizational value, were discussed as means for organizing an on-going environmental analytical marketing research program. 118 Chapter 3 provides an overview of the Department's position or competition analysis. The purpose of this analysis was to better analyze potential Departmental program strengths and weaknesses by comparison with other leisure service providers in the study area. A data collection survey form and corresponding data base, identified in Chapter 3, was established as a means for structuring the position analysis. Increased awareness on the part of Departmental staff of the growing competition in leisure services provided insight into the need to become more aggressive in program areas considered critical to the Department's image in the community. Limited windows of opportunity were realized for some program areas, such as aerobics and exercise classes, as the number of private sector firms were quickly expanding in this market at the time of the study. The service area analysis, described in Chapter 3, provided the first major effort on the part of the Department to provide a geographic basis for assessing comprehensive Departmental services. No direct linkage had been made prior to this research between the distribution of services and changing demographic conditions as defined within specific geographic zones. The political challenges associated with this type of assessment are many. Geographic areas identified as low service areas having received low Departmental attention have to be considered in conjunction with new Departmental priorities based on market segmentation, competition, program financial and other related Departmental objectives and constraints. In summary, most of the environmental analysis market research conformed to traditional approaches used by many public leisure service agencies. Contribution to future study strategies were based on 119 approaches used in the last two research studies: the position and service area analysis, identified above and described in Chapter 3. These types of studies were considered important to the market planning process and determined not to be as commonly implemented by public leisure service agencies at the time of the study. Resource analysis. (1) Internal analysis. The major focus of the study's internal resource analysis, in addition to data obtained from internal environmental audits, was in the conduct of the staff image survey. Again, this study is described in Chapter 3. The simplicity of the image survey instrument contributed to both the relatively high response rate and the ease of survey data analysis. A great deal of important information was obtained from the staff image survey which helped in interpreting other internal audit studies. It also helped in formulating the community needs assessment and establishing organizational structures in support of the market planning process. A fairly standardized media assessment which would have examined the Department's current communication strategies and evaluated alterna- tive media selection was not conducted due to changes in Department personnel during the course of the case study. Such a study is recom- mended in Chapter 5 to provide perspective on communication effective- ness. Many public service agencies tend to limit communication of services to their markets through the use of seasonal program brochures, public service announcements, and flyers. Use of paid advertisement, direct mail, merchandizing, and personal selling strategies, among others, are not often found among such agencies. A media assessment study is an important tool needed in evaluating future marketing promotion strategies. 120 (2) External analysis. Major components of the external resource analysis included the community image survey and portions of the community needs assessment study, discussed in Chapter 3. The community image survey was limited in scope to a survey of a little over 1,000 community leaders of area agencies and organizations. A more comprehensive survey would have involved a representative sample of community residents. The use of a survey instrument, similar in design and inventory of attributes to the internal staff image instrument, provided useful comparisons in study findings. It was anticipated that there might be areas of significant difference between internal and external image assessments which would provide focus for further research and marketing strategies. This did not prove to be the case. Consistency in evaluation of departmental strengths and weaknesses, particularly in the areas of park maintenance and communications, respectively, provided strong support for needed departmental changes. A limited number of survey questions were included in the community needs assessment instrument to identify public perceptions on key Departmental service attributes. This included questions on perceived participation barriers, concerns related to participation safety and security, quality ratings of services, and related financial issues. It also included an open-ended question on greatest Departmental strengths and weaknesses. When reviewed in light of the data obtained from the community image survey of local area leaders, the external analysis market research provided a consistent and clear perspective on how the community perceived the quality of Departmental services. 121 Case Study Organizational Structure Development Two primary objectives were used as the basis for establishing the organizational structure used in the case study. The first was to better support the core marketing strategy, identified during the study, of improved decentralization of authority and responsibility as a means of increasing opportunity for new program expansion. The other objective was to provide a balance between the ability to implement marketing plans and providing close coordination, consistency between long-term marketing goals and objectives, and short-term marketing activities. As indicated in Chapter 3, program managers in the case study agency had more responsibility than authority over their areas of supervision. These managers were responsible for hiring staff and controlling costs but did not have the authority to manage program promotion or monitor specific program revenues. This mixed treatment of authority and responsibility created real challenges in establishing an organizational structure suitable for supporting both the preparation of the new Departmental SMP and the ability to implement the plan through an annual market planning process. Chapter 4, Section I includes a description of the two corresponding elements of the case study agency organizational struc- ture. That is, the management structure which organizes human resources and the process which was used by the organization to work together to accomplish the market planning activities. 122 Goal Eopmulation Chapter 2 includes an introduction to the theory of establishing an effective marketing oriented agency mission statement. Discussion of planned activity regarding this effort, unfortunately not completed during the course of the case study, is addressed in the section entitled "What Was Planned for Completion." Marketing goals and objectives. Marketing goals and objectives provide the forward looking procedural elements which translate the mission statement into operational terms. As indicated in Chapter 2 on goal formulation, the DPR mission statement, once prepared, should provide the Department with the broad parameters and supporting rationale for initiating any specific program. The supporting goals and objectives should specify what the program should accomplish and describe, in some detail: how, when, who, what, and where it will be done. Well written goals and objective statements are essential if all the diverse working elements of the DPR are to be effective in moving towards accomplishing the Department's long-term mission. The following goal and objective statements were prepared during the case study by a Departmental staff team providing support for the Marketing Steering Committee. They were prepared for the purpose of initiating discussion and providing short-term focus on Departmental issues related to taking necessary steps in developing a marketing orientation. From this discussion, new ideas were to be generated that would help in the formulation of a new DPR mission statement, and later, in the preparation of new goal and objective statements. 123 Preliminary DPR Marketing Directed Goals and Objectives: (a) Goal: Offer more programs for identified targeted segments. (1)) (C) ((1) Objectives: (1) Identify target segments' interests and program needs. (2) Determine if existing programs should be terminated, modi- fied, or expanded for the target segments. (3) Market test and evaluate new programs targeted for priority market segments. Goal: Prepare and adopt annual marketing plans for each major DPR program/feeility/activity area. Objectives: (1) Establish a consistent format for each manager to use. (2) Educate each manager on how to write a marketing plan. (3) Plan, develop, and implement a demonstration project to provide staff guidance and experience. (4) Determine a systematic performance evaluation system to measure the plans' effectiveness. Goal: Identify desired levels of financial subsidization for programs/facilities/activities that are beneficial to target markets. Objectives: (1) Determine total costs and revenues per user for each pro- gram/facility/activity. (2) Establish a user cost/benefit ratio to compare programs and evaluate their effectiveness. (3) In the budget process, establish an appropriate level of financial subsidy for each programming area consistent with DPR mission, goals, and objectives, and related long- and short-term marketing strategies. Goal: Assess DPR image and make improvements as needed to obtain desired community position and support. Objectives: (1) Expand community surveys to further define the Department's image. (2) Survey targeted facilities and sites for particular concerns. (3) Strategize ways to improve DPR image, and that of key programming areas, and test efforts through community input. 124 (e) Goal: Develop user incentive program. (f) (g) Objectives: (1) Determine what marketing tools are available to use (i.e., early registration discounts) given current policy con- straints and determine if there is need to change or add current policies. (2) Test different tools to determine effectiveness. (3) Constantly monitor and evaluate newly adopted incentive strategies. Goal: Increase the use of program evaluations and user/ community surveys to support the development of a Departmental Marketing Information System. Objectives: (1) Use survey information: (a) As part of systematic process for use in determining success of programs offered. (b) Assist in determining new community demands and needs. (c) Use in increasing the quality of DPR services. Goal: Develop new marketing strategies to increase DPR sponsor- ships. Objectives: (1) Research potential corporate sponsors. (2) Develop a computer data base providing information on all potential sponsors. (3) Coordinate timing and focus of proposals with sponsors' fiscal year and targeted market segments. (4) Provide a market segment defined list of consumer benefits the Department can provide to the corporations in return for their support. Attempt to develop menu of options from which sponsors can choose to participate. One of the real challenges during the case study was generating timely Departmental mission statements and supportive goals. Because of the importance and critical nature of their use, Departmental managers responded by requesting many drafts and review sessions. What was learned from the process included several important points. The first is that use of early market research studies can play a significant role in shaping the goals and objectives. Second is that preliminary 125 direction provided by marketing goals and objectives were needed by a number of market planning groups as starting points. These points guided the process or established the preliminary assumptions used in the process. For example, the evaluation of the Department's program portfolio or the identification of priority market segments both required direction established within the marketing based mission statement and goals. In return, the results of these market planning activities would themselves generate outputs which would refine and modify the statement, goals, and objectives. The following table (4—9) attempts to show the proposed sequence of major market planning activities associated with goal formulation strategy. The point suggested is that like the many other market planning activities discussed earlier, the creation of a new Departmental mission statement and supportive marketing goals and objectives should be treated as an interactive process. Several drafts of these key elements would likely be required, being continually modified in response to new market research findings and market planning activities. Distribution of dated drafts to all active members involved in marketing planning is important as they provide the "cement" or common focus for the SMP. Marketing teams must be cautioned early in the process that evolving marketing goals and objectives would require continual reassessment of planning assumptions and recommended strategies. Therefore, some revision of on-going work would likely be necessary. To prevent major planning process changes, top managers must be both cautious in their treatment of these important planning elements but must balance this caution with the need to support the continual momentum of the planning 126 Table 4-9 Sequence of Major Market Planning Activities Associated with Gog; Formulation Strategy *Initial market planning organizational structures - Focus on: Market Planning Process Market Research Activities *Provides structures and information to develop initial assessment of Departmental StrengtthWeaknesses and Opportunities and Threats Provide basis for preparation of initial departmental marketing mission statement and goals *Supports direction for conduct of additional market planning activities including: Departmental Financial goals Departmental positioning objectives and objectives theme/image Program portfolio Market segmentation analysis priorities/strategies Used to produce revised SMP marketing mission statement, goals, and objectives 127 process by providing critical inputs as needed to maintain planning schedules. What Strategic Market Planning Strategies Were Planned for Completion The following material reviews those SMP strategies which were either initiated or partially addressed during the case study or only planned for completion and not initiated. Strategy Formulation Introduction. Kotler and Andreasen (1987) define a core marketing strategy as the selection of a target market(s), the choice of a competitive position, and the development of an effective marketing mix to reach and serve the chosen customers. (1) Target market strategy--Starts with defining the markets (set of all people who have an actual or potential interest in an exchange and ability to complete it) using any one or combina- tion of segmentation variables. For each major product/market segmentation scheme, using prior portfolio scenarios, evaluate the alternative five basic patterns of market coverage: (a) Product/market concentration-~or concentrating on only one market segment. (b) Product specialization (decide to produce only one basic product/service). (c) Market specialization (decide to serve only one segment with all products/services). (d) Selective specialization (decide to work in several product/service markets that have no relation to each other except constituting an attractive opportunity). 128 (e) Full coverage (decide to offer full range of product/ services to all targeted market segments). Following the selection of one of the above alternatives, market planners must determine possible subsegmentation strategies, such as geographic areas, to allow for more specific and measurable marketing objectives and effective implementation strategies. The following figure describes the sequence of major planning activities partially utilized or recommended for use in the process of identifying DPR core marketing mix strategies. Following sections include descriptions of these process elements, starting with the identification of program financial objectives. Financial obiective strategy. In 1987, the Department identified, through the efforts of the market planning process, a financial target of becoming 80% self-sufficient, or generating 80% of annual operating costs through earned revenues, to be achieved by the year 1991. With this newly established target and with identification of market segment priorities (discussed below), the Department initiated the analysis suggested in Figure 4-11. Each Departmental program needed to be examined in terms of its targeted markets and current revenue/cost ratios to determine the appropriate level of subsidy it should receive over the SMP planning period. Programs directed towards highly resistant market segments would require greater subsidization. As marketing sophistication improved, some programs aimed for more respon- sive market segments would move through different stages towards becoming net revenue generators. Resources available within the Depart- ment would then help continue to support services to those who can't afford to pay "as—you-go." 129 Market research Planning team findings outputs Identification of program financial objectives Market segmentation strategies Program portfolio assessment Identification of core marketing mix strategies I l I Program Place/distribution Price Promotion Figure 4-10. Case Study Sequence for Strategy Formulation. 130 Fully Partially subsidized Break- Net subsidized even revenue (over 75%) I genera- service 50-75% 25-50% tion Existing New Figure 4-11. Framework for Programming Financial Objectives. Source: Adapted from Crompton & Lamb (1986), p. 61. Progress related to this program evaluation task during the case study included a historical financial assessment of program revenues and costs. It also included the identification of preliminary 5-year financial targets for all major program/facility areas. As indicated in Chapter 3, additional in-house educational sessions were recommended to support mid-level managers in developing the management skills needed to prepare and utilize financial management systems. The following supportive projections/documentation from market planning teams (MPT(s)) were needed to further develop the assessment suggested in the above figure for each program/facility area: 0 Projected visitation/enrollment by month 0 Projected (fees/charges) revenues 0 Projected program allocated costs 0 Projected net revenue/cost Market segmentation strategies. The segmenting and targeting of well-defined consumer groups is a relatively well understood and 131 traditional marketing strategy used by the private sector. Most people understand the need for commercial organizations to identify for the services or products they produce, what is the most responsive market segment? That is, which classes of consumers are most willing and able to pay for their services? Given every organization's limited resour- ces, it's obvious that effectiveness and efficiency can only be achieved if potential target groups are identified where the most aggregate benefits can be delivered per unit cost of consumption. Further supportive discussion on segmentation is provided in Chapter 2. Prior to this study, the FW-DPR followed a traditional strategy used by many public leisure service agencies. It could be considered a differentiated approach using a mass marketing strategy. A seasonal program brochure with over 100 diverse program activities was mailed or distributed to all community residences. It announced that a specific program must have a minimum number of people to be implemented. Instead of selecting specific marketing strategies and pinpointing market targets in advance, the Department allowed the marketplace to do it for them. Interested potential client groups identified themselves and were reached, if adequate in number, with the programs they desired. The following table describes the case study strategy that was developed and recommended for the identification and selection of market segments. A brief description of each of these major steps follows. 132 Table 4-10 Case Study Strategy for Identification and Selection of Market Segments Using o First draft marketing mission statement, goals, and objectives o Financial goals and objectives o Acceptable position/policy on competition o Departmental theme/image objectives Perform following segmentation planning steps o Identify trade-offs of efficiency vs. effectiveness between alternative general strategies o Evaluate information available to segment market o Determine desired position regarding focus on responsive vs. nonresponsive segments Formulate market grid analysis o Types of client groups o Socio-demographic classes (1) Case study recommended segmentation planning steps. Step 1. Identify trade-offs of efficiency vs. effectiveness between alternative general strategies. Kotler and Andreasen (1987) identified three broad market selection strategies for consideration by nonprofit market planners. The undif- ferentiated strategy (mass marketing) is one of providing a single marketing mix for all identified client groups, trying to attract as many customers as possible. The concentrated strategy focused on one or possibly two market segments, often including those which are the most 133 important (politically) or most responsive. The agency then develops an effective product offering and marketing mix for each. The differen- tiated strategy is when a range of products or services are defined for several or more market segments. The effectiveness and efficiency trade-offs are easily conceptual- ized. A differentiated strategy may provide a greater positive impact on selected target markets by providing more specifically designed programs/services which match their needs. This in return might elicit greater customer support, loyalty, and satisfaction from those market segments. On the negative side, of course, is the higher cost associated with this provision of specifically designed services. Howard and Crompton (1980) suggest that use of differentiated strategies usually requires higher operation costs which can include: 0 increased salary costs for specialized instructors 0 higher equipment/facility costs to meet different skill require- ments 0 increased liability insurance costs to cover more advanced skill activities 0 additional equipment storage and handling costs. Effectiveness then is only achieved if total client satisfaction or revenues produced exceed the extra costs which the strategy may incur. Table 4-11 was presented to the FW-DPR Market Steering Committee (MSC) as part of an orientation session prior to initiation of segmenta- tion planning. Its purpose was to illustrate these trade-offs and the Departmental issues associated with the segmentation decision. It was a useful tool in establishing a proper orientation to segmentation. Table 4-11 134 A Continuum of Alternative Strategies Relgted to Market Segmentation A *Objective A: *Objective B: Effectiveness vs. Efficiency To serve the leisure needs and interests of all the people of Fort Wayne. Questions? -Who is under-represented? -What is an essential service to be given priority? Ex. Inner city, low-income senior citizens/youth ROI in staff time and budget dollars will be limited/ unresponsive market, hard to reach, remove barriers, limited # of users, little growth. To serve the leisure needs and interests of most responsive segments. Ex. 30-44 year old middle to upper class urban and subur- ban white males Large % of population/growth market/greater probability of success in achieving financial objectives. 135 Step 2. Evaluate information available to segment market. General market segmentation theory indicates, in examining requirements for effective segmentation, that all defined segments be sufficiently large enough to justify related costs; be measurable in terms of segment characteristics; and be accessible through available promotion or communication media. For a leisure service agency developing its first SMP, it is highly likely that market characteristics used to segment markets will be limited to either geographic (neighborhoods, regions, zones), sociodemographic (age, gender, race, income), or behavioral based factors. Three commonly used behavioral segmentation factors include: 0 Usage level: Users vs. nonusers Former users Potential users First-time users Light or irregular users Medium/heavy (loyal) users 0 Stage of readiness: Awareness of programs Interest in programs Trial (first-time user) Adopters (medium/heavy users) 0 Level of skill: No skill Novice Intermediate Advanced 136 As noted earlier in Chapter 3, the FW-DPR had only developed limited profiles of current program users. Data available on segments being served at the time of the study were limited to age, gender, and in limited cases, neighborhoods. To augment the available data, extensive effort was made in the community needs assessment to obtain information related to usage and stage of readiness for major service classifications. This information could then be analyzed on the basis of the 10 geographic zones identified earlier in this report. These data, though collected, were not made available during my involvement with the study. Step 3. Determine desired position regarding focus on responsive vs. unresponsive market segments. As suggested in the last table (4-11), FW-DPR market planning teams were asked to examine efficiency and effectiveness trade-offs between alternative general segmentation strategies. Recognizing the limita- tions of available data on current users, the staff was asked to consider the different positioning strategies that would be required based on which segments would be given priority. A focus on most responsive segments is a strategy of least resistance and is less costly. A focus on the most unresponsive segments would be on those who are underrepresented in current user groups in relationship to their numbers in the market population. In the Fort Wayne area, this would have included older adults and non-sport oriented teens, among others. As suggested earlier, this would be less cost effective but possibly meet a greater political priority for the Department. 137 It was suggested that additional market research would be needed, particularly for any unresponsive market segment chosen for priority consideration. The research should identify how members in the segment vary in their perceptions of constraints to use the services provided. Some of the types of user barriers which were recommended to be examined included: TYPES OF BARRIERS: - Agency contributing: Product failure Pricing Distribution Promotion - Social constraints: Relations with others - Individual circumstances - External physical constraints The preliminary results available during the case study from the community needs assessment indicated that a major user constraint in the Fort Wayne area was social constraints. This concern was over security or safety related generally to the mix of users participating in current Departmental programs. The challenge then to the FW-DPR was to identify barriers for each segment under consideration through research and attack those barriers which impact on the majority, resulting hopefully in the largest increase in customers. Another recommended strategy was to remove the easiest barriers, providing the fastest results if time is of major importance. A more political approach, of course, would be to attack barriers of the most "needy" of the segment subgroups. 138 (2) Market segment grid analysis. Following the completion of the above steps, the Market Steering Committee was provided with several market segment grids shown in the following figure (4-12). The purpose of the grids was to encourage the use of a systematic approach for assessing the types of leisure wants and preferences that different market segments were perceived to possess based on available information. As a means for determining which segments should be given priority status, factors discussed above were recommended for consideration along with the following: (a) From Departmental positioning study, examine which market segments are being given priority focus by major leisure service competitors. (b) Decide if Department is going to be willing to compete or only compliment the services being provided by competitors. (0) Identify the unique contribution the Department has to offer unavailable to the competition. (d) Examine new positioning opportunities the Department may have in terms of market gaps where services are needed and not being provided adequately. At the time of the study all major Departmental programs, with the exception of the Zoo, were generally focused on individuals. Conse- quently, the first grid focused attention on other potential client groups. Data to be obtained from on-going research studies would allow for potential use of socio-demographic classifications. The above recommended FW-DPR market segmentation steps, in summary, utilize a relatively basic or simplistic approach to the process. This 139 TYPES OF CLIENT GROUPS LEISURE NEEDS - - - - POLITICAL / INDUSTRY / ASSOCIATIONS / INDIVIDUALS SOC/O - DEMOGRAPHIC CLASSES GEOGRAPHIC AGE GROUPS / GENDER / INCOME / RACE-ETHNICITY / ZONES Figure 4-12. Market Segment Grids. Source: Adapted from Crompton & Lamb (1986), p. 137. 140 was in recognition of the very limited marketing sophistication and available databases available within the case study agency. As this level of sophistication improves, segmentation strategies utilizing such dimensions as consumer lifestyles or benefits sought may provide more useful approaches. The key, through research, is to develop useful linkages between selected user characteristics and user responses to the mix of services offered. Departmental programming portfolio strategy. Marketing strategies provide the connecting link between marketing objectives and the detailed action programs undertaken by an agency to accomplish them. The strategies provide guidance to where major efforts should be directed in order to obtain stated objectives. They focus on selection and use of available agency resources from a number of alternatives. If appropriately written, market strategies should address such questions as: "Should the agency seek to expand, contract, or change the emphasis of the range of its programming services or the market segments tar- geted?" and if so, "Which programming services and target markets?" and "How strongly should it pursue such action?" Emphasis was placed in the marketing planning model identified for this case study in developing a Departmental programming portfolio analysis. The challenge was to develop a conceptual framework that could be used to examine all current and proposed DPR programming activities for purposes of determining which areas should be emphasized or deemphasized over the next 3-5 years. This was the planning horizon for the Department's Strategic Marketing Plan (SMP). Problems encountered in maintaining the market planning schedule, as discussed earlier, prevented the development of the desired 141 Departmental portfolio analysis. The following figure (4-13) was developed early in the market planning process as an initial framework for analyzing FW-DPR services. This framework was to be used to structure relationships between existing and new target market segments and current or proposed Departmental programs. It would indicate which programs should be modified, maintained, reduced, or terminated. Progress in this effort during the case study was generally limited to inventorying existing programming services and identifying what had been known regarding market segments being served by each. Most DPR programming managers had not conducted user profiles so market segment identification was generally poorly defined. In an attempt to examine distribution patterns, program services were identified by zones. These geographic zones were reviewed earlier in this chapter. The planned study approach was to examine and compare existing zonal distribution of services and facilities to findings from the community needs assessment (CNA). Reallocation of survey responses to area classifications in lieu of the use of zones as described in Chapter 3 required further work on the distribution analysis. Once the DPR has completed the process of: identifying and select- ing priority target market segments, better defining market segments currently being served through existing programs,and developing long- and short-term financial objectives and associated revenue management plans; it will have most of the required information needed to complete the portfolio analysis suggested in the above figures. Marketing strategies for specific recreation programlactivityz facility areas. The market planning process developed and partially implemented by the Department as a product of this study utilizes the 142 1. Community Publics II. Age Class III. Socio-demographic Profiles IV. Leisure Behavior V. Readiness Stage VI. Location I II III IV Political Preschool age Sex Nonusers Industry (6 & under) Income Former users Associations Grade school (7-12) Education lst time users Individual Teenagers (13-19) Race Light users Citizens Young adults (20-39) Medium users Middle-aged adults (40-64) Heavy users Retired adults (over 65) V VI Aware of Geographic location services (Zones l-lO) Trial/Adapters Program/ services New Modifications Maintain Retrenchment Termination programs to current existing of existing of existing or programs/ programs/ programs/ programs/ services services services services services Markets: ——— —- -— ==— Existing N2! Figure 4—13. Departmental Program Portfolio Analysis. Source: Adapted from Crompton & Lamb (1986), E). 61. 143 concept of team planning. Three market planing teams (MPTs) were organized in the winter of 1987. The MPTs were given the responsibility of developing program portfolio assessments, similar to that discussed above, for programs administered by staff assigned to each team. Program managers were given a guide sheet to help them prepare back- ground information on each program area. This information would assist them in developing subprogram area portfolio assessments. Scheduling problems limited achievement in this area. As indicated in the Market Planning Team's objectives discussed earlier, it was hoped that each of the three teams would develop the following information, by program: 0 target markets 0 location and distribution of services identification of program benefits financial assessments/objectives 0 market research recommendations. Problems associated with work allocation priorities, lack of organizational support staff, limited understanding of marketing concepts, poor DPR management information systems, no formal program evaluation program, limited accounting information on revenue tracking, lack of policy on many marketing related issues and the time constraints of the Market Steering Committee to accomplish its tasks; all constrained the MPTs in meeting these objectives (low level of market readiness). This is not to suggest that progress in initiating key elements of the market planing process was not achieved. Lacking formal Department approved market segmentation priorities and related financial 144 objectives, emphasis in the MPTs was placed on examination of management activities and operational and policy issues of concern to each team. Continual progress through support and implementation of the market planning system would, it was recognized, gradually result in the development of information needed to prepare marketing strategies for specific recreation program/activity/facility areas. These strategies would then be addressed in the preparation of area-specific annual marketing plans. Implementation of these annual marketing plans should then assure achievement of long-term Departmental marketing objectives identified in a completed FW-DPR strategic market plan. Annual DPR program/facility/activity-specific market plans would address the following questions: 0 Which target markets will we serve? 0 What services or facilities should we offer them to provide for user desired benefits? 0 What fee should we charge, if any, and how should it/they be structured? 0 How should the service offerings be distributed? 0 How should we best communicate to target markets the benefits offered by these services? The action portion of the annual marketing plans will define: O activities/strategies to be used to achieve annual performance objectives; 0 specific assignment of responsibilities for accomplishing work/ performance tasks, by name or office; 0 detailed assessment of resource allocations to support work tasks; 145 0 statement of priorities used to later direct resource allocation conflicts. In effect, then, each specific DPR marketing plan would stand alone. The coordinated 3- to 5-year strategic plan provides general guidance and direction for all annual DPR annual marketing activities and identifies the allocation of Departmental resources, including long- term references on: 0 what is to be done 0 where it is to be done 0 how it is to be done 0 who will be responsible for doing it. It was recommended that the Market Steering Committee work closely with the market planning teams to develop a long-term, flexible schedule for completion of the specific program annual marketing plans. At first, some additional research would be required by a program manager to complete a program-specific environmental assessment. All program managers would be required to initiate some marketing related program evaluations and demonstrate their awareness of applying marketing mix strategies to their programs. Case study supportive research suggested that some high visibility program areas might serve as marketing demonstration projects. These demonstrations could have the advantage, if successful, in obtaining internal and external support for DPR market planning and provide a hands-on teaching tool for Departmental staff. The danger of demon- stration projects, it was also learned from secondary research, is establishing the perception that market planning can be implemented on only a project-by-project basis, lacking the support and utilization of 146 a comprehensive agency systems approach. From this assessment, it was argued that DPR managers would have greater difficulty in establishing an effective agency-wide market planning system if they begin the con- version process with only the use of demonstration projects. Designing the marketing mix. Depending on the starting stage of "market readiness,“ a public leisure service agency may take up to or possibly more than 5 years to complete the conversion process. The conversion process includes the preparation of a comprehensive, long- term SMP. It also includes the establishment of the agency orienta- tions; policies; administrative and management practices; organizational structures; information systems and resources needed to support the implementation, monitoring, control, and revision of SMP marketing objectives. This implementation process is directed through the annual marketing action plans. Many of these SMP activities can, with agency commitment, be conducted in a year's time as demonstrated with the case study. Figure 3-1 on page 57 was developed from case study findings and suggests the degree of analysis and study required to create a state of market readiness. This is the same model used in Chapter 3 to organize a brief review of the case study agency "state of market readiness." Table 4-12 provides a brief list of Departmental policy and management related issues framed within the marketing mix model shown in Figure 3-1 and used in the case study. The list provided a general checklist of essential issues which were examined as part of the process of identifying core marketing strategies within the SMP. The listed issues are not identified by either priority or sequence. It is by no 147 Table 4-12 Estab ishin a State of Market Readiness: Issues for Examination Program Mission statement, goals, and objectives Performance evaluation staff/programs Staff selection/training/incentives Internal marketing Quality control systems Program portfolio analysis Department image/theme New program team Marketing information systems Sale of alcoholic beverages Program registration services Front office procedures Use of volunteers Management of special activities/events Plgce/Distribution Equity models allocation of resources Market segmentation targeting Geographic distribution/analysis/ /monitoring Organizational structure assessment Price/Revenug Revenue Management Team Revenue goals and objectives - core/program specific Pricing strategies Use of Z.B.B. system Nonreverting funds Use of nonprofits Enterprise funding Allocation of fixed costs Degree of prioritization: - Foundations - Trusts - Rentals - Leasing - Fund raising - Merchandizing - Corporate sponsorships - Concession contracts Promotion Media inventory Media effectiveness and evaluation Cross-selling Client incentives Paid advertising Personal selling Cost allocation 148 means a complete list. It represents those major issues identified in the case study process as important to be evaluated in the process of establishing market readiness. One of the applications which was developed from this systematic review was to identify critical policy areas which must be addressed by the FW-DPR to support application of one or several marketing mix elements. For example, establishment of a nonreverting fund policy was considered critical to support new program management incentives. A specific internal marketing strategy, it was recognized, needed to be established to implement this policy position. There is a great deal of specific guidance available to public leisure service managers on optimal management strategies. During the last 15 years, there has been a detailed review of new, innovative management approaches, specifically in the areas of price/revenue management and new agency promotional mix alternatives. Articles on new privatization strategies successfully applied by public Park and Recreation agencies are complete with case study applications and recommendations. Promotional strategies using new direct mail, videos, cable TV, and other media have filled the various leisure service management journals. A great deal of time in the conduct of this research was devoted to reviewing these information bases. This was done to develop staff training programs which would link application of recommended management/marketing strategies to the market planning process. It is beyond the scope of this dissertation to provide a detailed review of this information base. Again, the major point being made is the need to develop a systematic approach to market planning which should include 149 examination of new alternatives for applying program, price, place, and promotion strategies. Systems Design Introduction. Results are the bottom line of any marketing effort. This section on systems design is focused on recommendations developed for the assessment of marketing activities after the FW-DPR marketing plan has been implemented. This final stage in strategic planning includes the monitoring and evaluation processes which identify where the marketing plan is working and where and why it is not working. From research on this topic addressed in Chapter 2, it was noted that there are two basic dimensions to the development of monitoring, evaluation, and control systems. First is the evaluation of individual Market Planning Team (MPT) program/facility/area services, which is continuous. The system must be designed to provide an evaluation of the MPT action plans to determine if changes in tactics are required. These evaluation activities then supplement a more comprehensive review, often referred to as a marketing audit which, it was recommended, be conducted by the Market Steering Committee (MSC) of the DPR's services and marketing activities at the end of the SMP period of activity. Systems for program evaluation and control. Part of a DPR's assessment of market readiness, as described earlier, includes what changes, if any, must be made to the agency's system of program evalua- tion and control. This includes determining the level of marketing intelligence currently provided by the computer supported, coordinated FW-DPR Marketing Information System (MIS). 150 Figure 4-13 identifies what was determined as a result of this case study to be critically important data base components needed to support both the comprehensive SMP and the on-going MPT program-specific evalua- tion process. This is not to be considered a comprehensive list. Other specific elements may be needed by a public leisure service agency to monitor and control variables unique to its marketing environment. In summary, it is argued that proper development and integration of these data elements will provide for much of the effectiveness, efficiency, and equity issues mentioned above. Each of these elements is briefly described below. (1) Accounting data base. The DPR recommended accounting system would provide program/facility/area specific cost and revenue records and forecasts accessible to all DPR program management staff. In addition to financial data, this system would support user records for program registrants, program and facility users or area visitors; all defined by the same system of code or line item numbers. An important use of this data base would, as recommended, be the analysis of sales and their measurement in relation to the sales related goals for different program managers. This would include the number of user exchanges which occur by zone, by market segment, or by program activity. User sales or attendance figures are key measures of effec- tiveness as they directly relate to marketing strategies or tactics regarding resource allocations and application of the marketing mix. They are an immediate reflection of consumer interest in particular offerings but are not always the best or only element that should be used in measuring program performance. It was suggested to the FW-DPR that the quality of their offerings was often not directly related to 151 Table 4-13 Marketing Control and Evaluation Systems--Information Data Bases to Support SMPZAnnual Action Planning Accounting Service Distribution Data Base User Profiles Analysis Overhead cost allocations by: Market segment by: Program/ Total and program/ Zone facility/area facility/area specific: Program/facility/ Zone Costs area Revenues Usage Positioning/Competition Promotion Effective- Staff Evaluations Data Bases ness Evaluation by MBO-work plans by: Program/facility/ by: Promotion include: area strategy Marketing objectives Zone Media selection Financial objectives Market segment User assessments Image surveys Program/Service Strategic Marketing Evaluations Effectivene§§ User studies/research Marketing audit Financial assessments/ Community needs assessments (accounting data base) Image surveys Focus groups 152 revenues or body counts while positive social changed behaviors, more difficult to measure, would tie more directly to their recommended format for a new marketing oriented mission statement. Cost analysis would include detailed breakouts on various marketing expenses as a ratio to sales/use or attendance to make sure program managers were not overspending to achieve their sales goals. Several key ratios, such as total marketing expense, advertising, promotions, research, and marketing administration to sales would be developed and monitored. (2) User profiles. From case study findings, it was determined that program registration and user evaluation forms, and other data collection efforts needed to be designed to obtain user profiles (demographic, geographic, behavioral, etc.) consistent with the recom- mended market segmentation models. The data would allow for evaluation by geographic zones, market segment classifications, or for any specific MPT program/facility/area activity. (3) Service distribution analysis. As suggested in Chapter 3, data which includes an inventory of all DPR services provided by geographic area or zones would provide a monitoring tool to examine equity. The inventory would reflect the changing allocation of DPR resources allocated in each zone over time. (4) Staff evaluations. The FW-DPR, along with a number of public leisure service agencies, adapted a form of a MBO program in the late 19705. A number of professional leisure journal articles, as an outcome, described both the merits and problems experienced. Most reviews suggested that a major component of the MBO process, the completion of the staff individual work plan was critical in the process 153 of linking organizational behaviors to organizational goals and objec- tives. As a result, it was recommended that individual work plans for DPR managers include marketing based objectives supported by financial ratios, sales and attendance objectives, and outcomes from user service assessments, among others. Further description of employee evaluation and related incentive systems is included later in this section. (5) Positioning/competition data bases. Chapter 3 included a description of a FW-DPR recommended data base process for monitoring leisure service competition. This competitive assessment should be capable of definition by specific MPT program/facility/area services, by geographic zone, or by market segment. The data base would provide some measurement on whether the DPR is gaining or losing ground relative to its competition. A special DPR facility, such as the zoo, may have rising annual attendance but may be experiencing declining market shares of recreational dollars by losing ground to area theme parks. The key challenge to the DPR is appropriate definition of competition tied to the perceptions of targeted consumers. (6) Promotion effectiveness evaluation. Case study findings suggested that DPR program managers would individually apply different approaches or tactics to application of the promotion mix (advertising, publicity, incentives, and personal selling) in their attempts to communicate their specific services to the public. A suggested DPR data base, supported by promotion research using evaluations which would take place before (pretests), during (direct responses), and after (post- tests) a program service, would help determine if the DPR promotion tactics achieved their prestated objectives. If designed successfully, 154 these tests would better evaluate the relative effectiveness of dif- ferent copy, artwork, layouts, media vehicles, discounts, incentives, and other related elements. As the FW-DPR becomes more mature and competition for leisure time pursuits and interests increases in the Fort Wayne area, it will likely allocate increasing resources to support program promotion efforts. The need to design increasingly effective evaluation strategies is con- sistent with this trend. (7) Program/service evaluations. The recommended DPR accounting data base, identified above, would provide critical inputs needed in the process of evaluating MPT programs or services. A variety of user effectiveness approaches could be utilized to determine if participants are satisfied with the benefits offered by any DPR specific program or service. Continual applications of the earlier described DPR comprehensive community needs assessment (CNA), the use of focus groups or consumer panels, etc., are other strategies which could provide both on-going and long-term comprehensive DPR assessments of service performance and effectiveness. For example, the following list of important data vari- ables were included in the case study community needs assessment and, if replicated in the future, could provide important indicators of change. 0 Resident participation/visitation patterns: DPR: Activities Programs Facilities 0 Resident perceived benefits (ranked) for selected programs/ activities 155 0 Resident perceived barriers (ranked) for selected program/ activities 0 Priority for expanded/new: activities/programs/facilities 0 Information channels: media currently used/preferred 0 Priority for new leisure services/by major age groups 0 Resident attitudes/service evaluation on miscellaneous issues 0 Resident perceived strengths/weakness of department 0 Resident concerns regarding safety/security. Strategic control. Kotler and Andreasen (1987) suggest that an effective market planning program be supported by a process which allows for long-term oriented strategic position analysis. As indicated in Chapter 2 from case study research, it was recommended to the DPR that the primary management tool to be used for this purpose would be the conduct of a periodic marketing audit. Staff incentive and evaluation systems. The FW-DPR, as part of its becoming more of a market-oriented agency through the case study, realized the importance of establishing a new employee evaluation and incentives program. Internal marketing, it was identified, is critical where most customer contact and benefits are derived from interactions between DPR staff and the customer. If DPR staff are not motivated to provide quality customer directed services, all other marketing efforts will fail. From case study findings, it was determined that in order to recruit and maintain quality staff, the DPR needed to develop a more attractive compensation plan. Staff desired a plan that provides regular income, reward for above-average performance and fair payment for experience and longevity. DPR managers in return, it was learned, 156 generally desired a plan which would emphasize control, economy, and simplicity. Discussion here is concerned only with the variable amount of employee compensation, not the fixed, or salary amount, that is available to stimulate and reward greater staff marketing efforts. To accomplish new market—oriented objectives, current and new DPR staff need to recognize the priority the Department was placing on providing quality services. Findings suggest that a market-oriented compensation system must be supported by an effective employee evaluation system. Generally, DPR managers developed perspectives on employees' performance in a number of ways. This usually included employee written progress reports, personal observation, customer or supplier letters, commen- dations, and through conversations with other DPR managers and staff. It was recommended that the DPR management also use MPT developed annual marketing plans. In these plans staff outline their coming year's program for developing new program services, increasing enrollments or usage, improving service ratings, increasing revenues, decreasing costs, or some combination of these. The detail of these MPT annual marketing plans would reflect the importance the FW-DPR gave to formulating long- term market goals. The details would also include the downward al- location of authority and responsibility top DPR managers provide to staff as managers of associated programming cost/service centers. MPT annual marketing plans can then be effectively used as performance evaluation tools for determining DPR staff incentives or compensation for market-oriented services. Establishment of a ManagementZMarketing Information System (MIS). Kotler and Andreasen (1987) suggest that support for marketing evalua- tion and control systems requires timely, accurate, and adequate 157 marketing information to be generated by any nonprofit's marketing information system or MIS. They define a M18 as a continuing interac- ting structure of people, equipment, and procedures. The structure is then designed to gather, sort, analyze, evaluate, and distribute per- tinent, timely, and accurate information to improve marketing planning, execution, and control. The marketing intelligence system researched for the case study focused on the process that was to be used by DPR marketing staff to obtain everyday information about developments in the external marketing environment. In addition to monitoring newspapers and trade publica- tions, it was recommended that reports from other city, county, and state departments be included in the establishment of a community network critically important to the DPR. To be successful, this recommended system will need the support of all DPR managers who will need to be "sold" on its importance. In terms of monitoring competitors, paid "bogus" consumers would be used to augment survey information to be collected on an on-going basis. The development of data bases on area corporations would be useful in supporting corporate sponsorship marketing efforts. The establishment of a FW-DPR support hot line for political/legislative issues could provide immediate help when legislative action being considered might threaten or help the Department. Case study findings indicated that marketing planning must include development of specific DPR policies which will regulate the control and methodology of all market research. Enforcement of these policies would help insure quality protection of data inputs into the M18 and protect the legal and privacy rights of the public involved. New research 158 strategies will be developed by the FW-DPR as the marketing process evolves. The inclusion of data studies on the economic impacts of special events/festivals, locational studies of special facility users and the application of sophisticated service quality surveys should be considered in future market planning processes. The FW-DPR, at the time of the study, had just recently initiated the use of PCs. It was noted that increased DPR productivity would be achieved if access to information on the limited PCs could be decentral- ized by placing more computer terminals and output devices in key administrative locations. During the period of the study, the FW-DPR had developed only a limited computer-based management information system focused on monitor- ing operating costs using line item and major functional area code accounts. DPR program managers had access to relatively good cost data but program revenues were generally grouped and lacked sufficient detail. During the study period, most computer applications for public leisure service agencies across the U.S. centered on: O accounting functions 0 league scheduling 0 park inventory systems facility-permitting systems 0 program reservation systems 0 workload/cost tracking. New computer applications identified in professional journals were being developed within computer-based information systems. They include financial analysis, forecasting, policy development, operation and maintenance management, fleet management, utility management, 159 engineering and landscaping design, and other related areas. The FW-DPR had limited awareness of these potential tools but had not committed resources to research or acquire them. The final point to be made in this section on systems design related to MIS development was the need to look beyond the creation of computerized data bases to consider the integration of data elements to support the FW-DPR marketing program. A further illustration of this point is made in the following figure (4-14). The relationships suggested in this illustration include the integration between in- dividual employee performance objectives and those identified for the FW-DPR. These objectives then are further integrated with those of the specific program/facility/area of responsibility the DPR employee may work within. A portion of these employee performance objectives may include such financial variables as increased revenues, decreased costs, or improved performance ratios, accessible through the recommended DPR accounting data base. Other performance elements may reflect scheduled changes or improvements to program quality and would hopefully be monitored by the DPR recommended program evaluation system. The overall evaluation of a FW-DPR employee's ability to meet work plan objectives using a number of M18 system outputs would be integrated into the recommended DPR staff performance evaluation system. Outputs of this system, if positive and meeting certain predesigned criteria, would then serve as inputs into the employee incentives and reward program. This program recognizes and supports DPR employee performance which exceeds set standards in meeting marketing related objectives. 160 Marketing Goals and Objectives Employee Work Plan Accounting Data Base (MBo) Program Evaluation Staff Performance Evaluation System i Employee Incentives and Reward Program Figure 4-14. An Illustration of the Integration of Data Elements to Support the Marketing Program. CHAPTER 5 CASE STUDY FINDINGS, RECOMMENDATIONS, AND FUTURE RESEARCH STRATEGIES Introduction Chapter 5 is divided in two major sections. The first section includes a brief review of case study observations and recommendations based on the strategic market planning strategies discussed in Chapter 4. Many of the recommendations provide guidance as to the type of data required in the recommended future research studies designed to further examine appropriate market planning conversion procedures. The second section provides a general design for these recommended future research studies. I. Case Study Recommendations Chapter 4 provides a comprehensive review of the strategic market planning conversion process and many of the steps required to establish a stage of market readiness. General Case Study Recommendation The continuous recommendation made throughout this report is that the creation of agency systems are needed to establish market readiness and are of greater importance than preparation of any individual marketing plan. A recommended generic approach to the conversion 161 162 process incorporating strategic market planning is to encourage use of dual objectives. While initiating the steps of conducting the Strategic Marketing Plan (SMP), at the same time establish the organizational systems necessary to create the desired stage of market readiness. Performing these tasks over the same period (which can take 3 to 5 years depending on where the agency is located on the market planning continuum when it starts) would put the agency in the position where it can begin implementation of market strategies immediately following completion of the SMP. The key is the planned integration between these recommended simultaneous events. The strategic market planning strategies identified in Chapter 4 provide a suggested framework for this approach. The recommendation, of course, is applicable to those public leisure service agencies which have committed themselves to a comprehensive conversion and have either not prepared a SMP or have had the experience of contracting out for one but were not in a position (stage of market readiness) to implement its recommendations. The argument supporting this key recommendation is that a comprehensive approach to developing the SMP will require many organizational changes needed to support on-going market planning and implementation. A SMP, without the ability to implement it, has little practical value. If an agency pursues the development of a SMP, not as just a means to create a planning document, but as an initiative to create a stage of market readiness, it will, I believe, increase its probability of having a successful, comprehensive conversion. More specific recommendations follow the Chapter 4 SMP model and include the following sections: 163 - Agency Orientation to Market Planning - Organizational Design - Marketing Research - Goal Formulation - Strategy Formulation - Systems Design The recommended future research strategy identified in Section II would provide a basis for further determining the value of these recommendations. Support for the recommendations is based on both the marketing planning work completed and that recommended for completion during the case study as described in the last chapter. Agappy Orientation to Market Planning Chapter 2 included discussion which addressed the importance of establishing the proper agency orientation to market planning during the initiation process. The following observations and supportive discussions more directly apply to public leisure service agencies positioned in the early implementation stage of the market planning continuum. They are based on case study findings and are critically important to establishing the proper orientation of a public service agency considering the conversion process. II Observation The general purpose of marketing is to increase the quality of public services provided by the agency as perceived by the clients being served. It is not just to increase revenues. Besides the prospects of increasing revenues, adoption of a marketing process can increase public support and use of departmental services. 164 Improved market-based program planning can result in higher quality services, reduced operational costs, and consequently, increased resource support for needed programs. If a department has adopted a supportive policy for revenue generation, market planning can be used to better affect all potential revenue services; such as corporation sponsorships, foundations, trusts, nonprofit agency formation, equipment and facility rentals, concessionaire con- tracts, etc. Emphasis on market planning should not be focused only on program fees and charges. Revenue generation programs targeted on segments which can best afford them can yield surplus revenue to be used to subsidize programs for those who can not afford to fully pay for services received. 0 Discussion It has been suggested throughout this study that the adoption of market planning primarily as a means of generating increased revenues tends to focus agency conversion procedures on short-term and limited marketing strategies. Many public leisure service agencies are often required or expected to provide services to nonresponsive markets, often via highly subsidized programs. These important program areas, and the agency staff associated with them, are often excluded from market planning when revenue generation becomes the driving force. Case study research suggests that many conversion problems are developed in this scenario. For example, DPR managers who have little opportunity for revenue generation in highly subsidized programs become fearful of marketing strategies and generate both negative input and planning roadblocks. More effort was required to convert the negative to positive support of these managers than would have been required to 165 assure a more carefully planned orientation process with full focus on service quality and less emphasis on revenue generation. W Agencies with prior experience in developing and implementing comprehensive master plans and annual operating plans will be more successful in developing and implementing a SMP. Plagues/1211. Chapter 2 provides argument which addresses the importance of agency planning experience prior to undertaking market planning. The lack of case study agency previous planning experience, as described in Chapter 3, proved to be a major obstacle in establishing a comprehensive approach to the conversion. Observation No matter what market planning models or approaches are used, the greatest single determining factor associated with the success or failure of implementing the marketing approach is the level of commitment to the process by top administrative staff. Resistance to change is high in any organization and can only be surmounted by a high level of priority support. Discussion In the Fort Wayne case study, this simple but extremely critical factor was clearly demonstrated. mm To facilitate the development of a SMP, a department has three options. One, hire a private sector marketing specialist and pay high training cost. (A limited number of leisure service professionals who have experience in marketing planning and 166 implementation may now be available.) Second, employ new marketing specialists, or third, train existing staff specialists. 0 Discussion All three strategies have advantages and disadvantages, the scope of which is partly dependent on time-driven considerations. A department should consider use of all three strategies (in appropriate proportion). Agency Orientation Recommengationa II Recommendation Early conversion strategies should include designed objectives of educating and obtaining support of on-going legislative boards, top agency managers, and mid-level agency managers. 0 Discussion As discussed in Chapter 4, case study findings suggest the importance of this approach in establishing timely and effective strategies to supporting the conversion process. A great deal of time, and subsequently resources, should be efficiently spent trying to establish unified agency support needed to develop a comprehensive approach to market planning. This would include more effective organi- zational structures and market planning procedures. II Recommendation The department should take primary responsibility for preparing its own plan. There is a high probability of low commitment, under- standing, or support for a plan prepared by an outside consultant. 167 0 Discussion This recommendation suggests that any agency which has utilized this approach will be in a better position of having established an effective state of market readiness. It will better allow for the creation of market planning organizational structures and planning systems which provide both the creation of a SMP and the ability to implement its recommendations through the conduct and implementation of staged annual marketing plans. This strategy provides for the fastest, most efficient and effective approach to the conversion process. II Recomnepdation Public leisure agencies which do not have a nonreverting fund policy should place priority on its adoption. ' Iii—5035311212 Marketing involves much more than promotion and advertising and many critical policy-based systems must be in place to allow the agency to manipulate pricing, distribution, and program-related variables. One of the most critical of these is a nonreverting fund policy which would allow a department to retain revenues generated from operations without experiencing short-term complimentary cuts in public support financing. Organizational Design Recommended Three-Stage Approach Table 5-1 illustrates a recommended three-stage approach to establishing an organizational structure for implementing the market planning function. It is assumed that the agency has identified its current state of market readiness and has established a comprehensive awareness of and commitment to a market planning conversion. 168 Table 5 . 1 Recommended Organizational Structure by Stage of Market Planning Concepts Initiation Stage Market Planning Task Force/Committee Developmental Stage Internal Market Planning Management System (Market Steering Committee - Market Planning Teams) Special Management Support Teams: o Departmental Image Team o New Program Development Team o Revenue Management Team Special Project Marketing Demonstration Teams Implementation Stage Marketing Staff Structures Program/Facility/Area Market Planning Teams Source: Adapted from Kotler & Andreasen (1987), pp. 273-293. Stage 1: Initiation. As indicated, the initiation or introductory stage is the period when marketing is first proposed as an approach or set of techniques for improving agency performance. This may come about from the actions of change agents (push strategy) who have learned of its value and potential. Another alternative is a pull strategy, where an environmental change in market conditions (less public subsidy, increased service demands, greater competition) have increased 169 organizational pressures to improve performance. Both of these condi- tions were confronted by Fort Wayne DPR and influenced its Market Planning Committee. Table 5-2 provides a list of recommended key market planning activities by stage of organizational development as identified from case study findings. One of the primary market planning activities conducted in the early orientation process, likely by the initiation stage market planning task force/committee, is the use of an initiation market planning audit. Part of the output of this audit should be the determination for the need for revised or new management processes needed to support market planning. This might include the development of management teams to address image/themes, new program planning or termination, and revenue development. Spaga 2: Developmental. The recommended developmental or growth phase of the process includes efforts to expand and formalize the role of marketing in the organization. One of the ways to formalize the role is to decide to hire a marketing specialist as either a staff or line function. If it is to be a staff function, a mid-level management position will often be created where the specialist functions as a resource consultant to internal managers. Often this position is located in planning, development, or public relations. The typical alternative is the establishment of an upper-level management position closer to being a true line position, allowing the marketing manager to participate in the setting of organizational policy and direction. This strategy provides more scope, authority, and influence to marketing. This was the strategy recommended for the FW-DPR. Thus, of the options 170 Table 5-2 Recommended Major Market Planning Activities by Stage of Organization Development Initiation Stage -— Establish Market Planning Task Force/Committee — Conduct initiation audit -— Determine optimum approach for securing technical support - Initiate phased internal market planning training program - Identify appropriate level of agency commitment and support/time frame for conversion process Developmental Stage Early Developmental Staqe - Identify market planning systems to support SMP’ - Review/modify agency policy positions - Evaluate potential of market demonstration projects Mid-Developmental Stage - Formalize market planning structures - Initiate SMP process - Develop MIS support Late Developmental Staqe - Identify market planning systems to support annual action plan development -— Complete SMP - Identify marketing monitoring, evaluation, and control systems Implementation Stage - Formalize annual action plan marketing structures - Implement marketing program achieving long- term SMP goals and objectives through phased implementation of short-term action plans Source: Adapted from Kotler & Andreasen (1987), pp. 273-293. 171 listed earlier on pages 166-167, the third option was the most feasible for the case study agency (FW-DPR). A key aspect of the developmental/growth stage addressed by Kotler and Andreasen (1987) is the management of initial marketing projects to demonstrate that marketing offers valuable contributions to the organi- zation. They suggest that a new marketing specialist be advised to work closely with key internal and external groups before selecting possible demonstration projects to be evaluated for consideration. Spaga 3: Implementation. The final implementation stage of organization will include the establishment of formalized internal staff structures needed to support annual market action plans. The expanding marketing department or unit should be given the responsibility for enlarging the opportunities to increase service exchanges between the agency and its publics. This should include the provision of general line authority over most of the tools needed to perform the marketing function. Part of this organizational planning process will include determining the appropriate internal organizational design for market planning implementation. The recommended market planning organizational structure included the formation of program/facility/area specific market planning teams. These teams provided oversight to the functional market planning teams, that included technical support staff from the marketing unit. Additional alternative strategies include assigning marketing staff to manage market driven program structures. Another suggestion includes using a geographic area emphasis through zones or area classifications, as used in the case study. In the latter alternative, all program— related information systems (revenues, costs, enrollments, visitation, 172 maintenance and operation services, etc.) should be able to be keyed, identified, and summarized in progress reports by geographic area. A further suggestion could be using a revenue source emphasis. Marketing staff would coordinate development of marketing plans to improve management in each targeted revenue resource area. Organizational Design Recommendations As suggested in the Organizational Design section of Chapter 4, top DPR management must consider which alternative organizational structure best matches current marketing mission goals and objectives and core marketing strategies. No matter which structure is used, the following concepts are recommended: II Recommendation Current DPR policies associated with marketing implementation activities, including discriminatory pricing, market research, corporate sponsorships, market segmentation, etc., should be evaluated for their influence on the orientation and priority development of new organizational structures. I Recomendat ion Creative conflict is likely, and should be encouraged, between organizational elements which have separate responsibilities for developing, implementing, and monitoring long-term core marketing strategies and short-term annual marketing action plans. 0 Discussion A balance must be created in the organizational design to insure that long-term marketing goals and objectives and core strategies are used to evaluate the performance of short-term marketing tactics. At 173 the same time, risk taking and creativity should be encouraged among those who are actively involved in implementing marketing activities. The long-term strategy oversight committee (Market Steering Committee) should include outside agency representation (expertise/information/ liaison) and have direct access to top decision makers if they are not represented on the team. If the oversight group is made up of top agency managers or outside firm executives, provision of a support staff is recommended. The case study experience indicated that high-level managers may provide useful direction and guidance but have limited time to generate written outputs required to support the development of the SMP. II Recommendation All organizational structures responsible for market planning activities should be adequately supported through Departmental management information systems. 0 Discussion Adequate and timely data from on-going or new market research studies must be easily converted to information needed to support planning assumptions and projections. II Recommendation Each market planning organizational unit should have full support of and open lines of communication with all Departmental offices which have any involvement in the delivery of program services. II Recommendation In the conversion initiation process, a DPR should fully comprehend the need to adjust market planning supportive organizational 174 structures and procedures to adopt to changing market conditions and related core marketing strategies. 0 Discussion Throughout the study it was apparent that shifts in team assignments and representation were required to adjust to changing conditions. The organizational structure used for the study was consistent with the need to broaden mid-level management control and initiation of new program services. Its application positively challenged top management which, only reluctantly, surrendered centralized management control in order to adjust to the core marketing strategy of program expansion supported by the DPR Legislative Board. I Recgepdat ion Internal as well as external marketing orientations should be considered in developing an organizational structure. 0 Discussion The need for new staff market training programs, the Board approval of a new nonreverting fund policy, and the creation of an improved employee evaluation and reward system are only a few examples of marketing activities examined during the case study which should be supported by the marketing organizational system. Application to Smaller Agencies The scope of the recommended Fort Wayne marketing management system was consistent with the Department's orientation and size. Smaller leisure service agencies having possibly only a few full-time staff positions will require a more informal market planning support structure having fewer levels and less structured coordination requirements. The 175 nature of essential market planning activities do not change, but the number of personnel available to share responsibilities varies. It is suggested that smaller departments will likely experience a trade-off in terms of positive and negative advantages in market planning. The obvious positive advantage is the relative ease management has in internal coordination, implementation, and control over marketing activities. The major disadvantage may relate to the large number of external agency groups upon which the small department may need to depend to provide such market planning support as provision of accounting and promotion activities, approval of needed Departmental policies in support of new marketing strategies, etc. As a small leisure service agency director, the key to establishing a successful marketing organizational structure will be creativity in establishing external agency support systems while large agency managers may have greater challenges of obtaining internal coordination and support. Marketing Research Agencies which utilize the SMP process as a means of establishing a high level of market readiness will not only be more effective in generating needed market research but will also establish better organizational structures and systems needed to utilize research needed for marketing implementation. From case study findings, it was observed that DPR managers who clearly demonstrated interest in and application of research data for the purposes of developing program services and related delivery systems were more effective in developing comprehensive market research programs. Many FW-DPR managers devoted most of their working days responding to on-going problems generated by historic 176 management decisions or related outcomes. Although a great deal of new research data was generated through the study process, most managers were not familiar with the approaches and perceptions used to apply data to management decision making. Marketing Research Recommendationa II Recommendation DPR marketing research strategies should include in-house capabilities for data analysis and interpretation and be established to make more effective use of research expenditures over the long run. 0 Discussion As identified in Chapter 3, the case study agency was dependent on the use of external contract services to conduct such major research activities as the community needs assessment. High costs discouraged subsequent follow-up analyses and full use of the information contained in the data base. In-house capability to conduct these activities would have generated greater agency understanding and possible application of study findings. A secondary benefit would have been the development of an integral component of the recommended management/marketing information system. II Recommendation Early in the conversion process, internally focused research should involve inputs from both top and mid-level agency management. This will be more effective in developing follow-up planning and support. 177 0 Discussion Going beyond the basic principle of good planning (getting those responsible for plan implementation involved in the planning process), the educational value of the recommended involvement in research is critical for the DPR staff recognition of the changes needed to support market planning. In the case study experience, experienced program managers who had serious reservations regarding the value of market planning generally supported the application of the conversion process to generate program data (user profiles, program specific revenues, performance ratios, etc.) that have been previously desired but not routinely collected or used. II Recommendation A DPR should incorporate on-going research strategies to obtain customer input to evaluate both program service and staff performance. 0 Discussion The underlying principle of marketing is the provision of quality services that are desired by the markets being targeted by the agency. On-going input from these markets through appropriate research techniques is deemed essential if objective program/staff evaluations are to be conducted and utilized in market planning. Goal Formulation Case study findings suggest that a DPR, as part of its conversion process, should allocate priority resource support to the task of developing a marketing oriented agency mission statement. This mission statement should be consistent with recognized long-term marketing 178 goals. Yet, agency top management needs to balance the priority of this task with the need to support the on—going market planning process with marketing direction and guidance. Practically all market planning literature stresses the critical importance of comprehensive and well developed marketing related agency mission statements. An agency must fully consider what business it is in and what business it should or will be in in the future as well as who its customers are or will be. Yet, from case study experience, placing such stress on the need for such careful consideration often fails to recognize the challenges associated with the development of a SMP or related annual market plans if goal formulation becomes a planning bottleneck. Chapter 4, goal formulation, provides supportive argument for balancing the need to create effective marketing mission statements, goals and objectives with timely guidance needed by market planning teams. The key is flexibility and the understanding that the focus is the creation of effective market planning processes, not plans. Goal Formulation Recommengationa II Recommendation A DPR should define its marketing objectives in terms of objective consumer satisfaction measurements related to perceived service benefits. 0 Discussion It has been stressed throughout this report that the appropriate public leisure service agency application of market planning should be the overall improvement in the delivery of services desired by the markets being served. To accomplish this, a marketing oriented agency 179 must define its business in terms of benefits its targeted customer segments want . Strategy Formulation Chapter 4 (see Figure 4-19) described the case study sequence for addressing the strategy formulation component of the strategic market planning process. The sequence included the key elements of market segmentation and targeting, assessments of agency program portfolios, and the identification of core marketing mix strategies. The following recommendations address these three elements. Strategy Formulation Recommendations II Recommendation A DPR should fully comprehend and actually pursue the market planning concepts associated with market segmentation and target marketing. If it is politically possible, a DPR should publicly recognize the application of these strategies as a means to more effectively implement core marketing strategies. 0 Discussion It would appear obvious that the application of market segmentation strategies is a critical element in planning process. Yet, from case study experience, top agency management without experience in marketing, often struggles with this concept. Traditionally, there is greater political protection in publicly proclaiming the delivery of leisure services to all community residents on a reportedly equal basis. It is argued that anything short of a public acknowledgment of the application of segmentation and targeting strategy will limit full agency commitment to market planning. Even identification of target market segments which 180 are kept under agency "wraps" sends confusing messages to agency managers and must be handled judiciously. II Reagmmandation A DPR should develop program portfolio assessments, as part of the core strategy formulation process, which include assessments of geographic distribution of services and facilities. 0 21mm Similar in principle to the above recommendation, there is a need for top agency management awareness and evaluation of historic resource allocation decisions on a geographic basis. Although it represents only one of many essential elements which should be included in the DPR program portfolio assessment process, it will often provide an objective picture of agency equity policy formulation. From case study experience, such an objective assessment may be politically sensitive. Like market segmentation, DPR management must be willing to provide public recognition of this assessment factor, along with others, as support for identification of agency core marketing strategies. II Reggmmepdation A DPR should provide high priority consideration of comprehensive internal marketing strategies as part of the core strategy formulation process. 0 Discussion One of the hottest management topics related to service management at the time of this writing is quality service and the effectiveness of agency programs designed to "empower" front-line employees in their "moments-of—truth" to provide timely services to customers. It is argued that most of the underlying principles which structure the 181 variety of quality service programs being implemented in the '905 are directly comparable to internal marketing approaches applied in the '805. Since leisure experiences are often directly influenced by program staff, no marketing strategy will be successful without the provision of quality services. Agency managers must develop comprehensive and continuous internal marketing strategies to train, motivate, and obtain commitment from service providers. Systems Design Case study findings suggest a DPR should develop market planning monitoring, evaluation, and control systems which are designed, in principle, to provide both formative and summative assessments. Such systems will support evaluation of services on the basis of effective- ness, efficiency, and equity. The establishment of management/marketing information systems and the use of market research should be structured to allow for required monitoring, evaluation, and control functions. System Design Recommendations I Recommendat ion A DPR should include, as a minimum, the recommended MIS data elements identified in Chapter 4 to support its conversion process. 0 Discussion From results of the case study, recommended data elements reviewed in Chapter 4 were considered extremely important in the design of information systems needed to monitor, evaluate, and control marketing strategies and tactics. 182 II. Recommended Strategies for Future Research Introduction In the following section several recommended strategies for future research are presented. Most of the discussion is centered on a recommended national study briefly outlined in the introduction to this chapter. Yet, it is recognized that no clear source of funding exists at this time to support the recommended procedures. In this light, brief mention of a less costly approach is included. Recommended National Study The following section describes a recommended two-step process for conducting future research on the effectiveness of varying market planning conversion processes. The first step would involve the conduct of a national survey for two major purposes: A. To develop a data base which can be used to identify and select an appropriate sample of public leisure service agencies for conduct of detailed case studies. B. Establish a market planning performance appraisal system using a set of generally acceptable and rated outcome measures. This would be followed in the second step by a national case study analysis which would have the following major purposes: A. Identification and assessment of agency behavior associated with strategic market planning activities. B. Testing of study recommendations using the performance appraisal system identified from national survey findings. Each of these steps are reviewed below. 183 §_§p 1: Conduct of the National Survey The first challenge associated with this task is to identify an effective and efficient means to establish an inventory of public leisure service agencies from across the U.S. which perceive themselves as having prepared and implemented a strategic marketing plan (SMP). Operational definitions for such key concepts as to what is a "public leisure service agency" or "implementation of a SMP" must be considered. Generally, the objective is to identify a list of agency names and addresses and basic profile of key operational characteristics. These would be developed for any state, regional, county, or municipal government operated department of parks, recreation, or related leisure services which believes it has both a SMP in place and has undertaken some activities to implement its recommendations. The second key component of the national survey is to establish a market planning performance appraisal system or model. The challenge is to identify and validate essential underlying dimensional structures of outcome measures which can be used to evaluate agency effectiveness in initiating, developing, and implementing a market planning system. An example of possible effectiveness measures include: 0 Gross program/facility/area revenues 0 Rate of return on investment 0 Rate of return users/visitors 0 Rate of new service users 0 Employee turnover/rate of internal promotions 0 Use of agency theme/positioning strategy 0 Budget support of market planning 184 0 Measures of user/visitor satisfaction 0 Cost by program per user A pretest using a subsample of leisure service agencies with market planning experience could be used to refine the draft inventory of outcome measures. The national survey would then include this inventory and would ask study agency managers to review the inventory and identify which of the listed outcome measures they currently use to monitor marketing performance and request that they add to or modify the inventory as appropriate. Examination of study findings will include a determination of whether different agency typologies can be used to explain or control for how agency management valued performance outcome measures. An essential issue to be considered in study design of this element is if the measures of effectiveness are in any way related to or substantively different from measures associated with general agency performance. That is, how well does the model distinguish effectiveness associated with application of market planning to nonmarketing related management applications. In summary then, completion of Step 1 will result in two key products: (a) an inventory of public leisure service agencies, includ- ing basic operational profiles, which have met study operational definitions related to experience in market planning; and (b) a draft model of market planning performance outcome measures which have general acceptance and support. The resulting appraisal model will hopefully be comprehensive and practical in its ability to capture all important aspects of marketing effectiveness. The model will then be applied in Step 2 of the recommended future research process to test study 185 hypotheses using the market planning behavioral data collected in the case studies. Step 2: Conduct of Public Leisure Service Agency Case Studies As suggested above, results of the Step 1 national survey efforts will provide data which will allow sample stratification of public leisure service agencies having varying levels of experience with market planning. Depending on resource availability, a representative sample of these agencies would then be randomly selected, following stratification, for potential inclusion in the national case study analysis which would involve on-site examination of post and current agency behavior associated with the limitation, development, and implementation of market planning. Design of case study procedures should include examination of all key elements of market planning as outlined in Chapter 4. That is, information should be obtained on initiation strategies used, their relative degree of success and recommended retrospective changes identified by agency management. Also to be reviewed are organizational design structures, the formation of marketing related mission statements, goals and objectives, key marketing strategies, and marketing system components. In conclusion, it is suggested that conduct of the above research approach would, in addition to testing the study recommendations identified in Section I, provide new information linkages between leisure service agency post and current behavior regarding market planning and the conversion process and effectiveness in market planning performance. A final desired research outcome would be the creation of 186 a market planning conversion model which would include recommended agency strategies in the initiation, development, and implementation stages of the conversion. A market planning performance appraisal and monitoring system, comprehensive and practical in nature, should also be developed as a tool which can be used by agency managers throughout the conversion process. The following table represents the recommended two-step future research process. Table 5-3 Two-Step Proceas Recommended for Follow-up National Survey National Survey * Identification of sample of public leisure service agencies for conduct of case studies '* Development of market planning performance appraisal system (outcome measures) Case Study Analysis * Identification of agency behavior regarding strategic market planning (determination of status on conversion continuum) * Tasting of study hypotheses using performance appraisal system identified from national survey 187 Alternative Suggested Research Approach An additional study recommendation would include a follow-up case study analysis of the Fort Wayne Department of Parks and Recreation. The focus of the study would be on what has happened since actions taken as part of this study were completed. Many of the key DPR managers, at the time of this writing, were still employed and could be questioned on recommended changes in conversion strategies. Follow-up could be focused on which recommended market planning strategies not implemented during the study were acted on and which were later considered inappropriate, if any, and why. APPENDIX 1: Fort Wayne-DPR Mission Statement 188 APPENDIX 1: Fort Wayne-DPR Mission Statement PHILOSOPHY ........................................ This We Believe, Parks and Recreation is a service to people which requires an understanding of human growth and development, an appreciation and awareness of human needs and interest, and knowledge of park and recreation areas, facilities, and activities. Parks and Recreation provides excellent means and opportunities for meeting all people's physical, mental, social, and aesthetic needs and interests through areas and facilities, programs, leadership, and other service mediums. Parks and Recreation is a particularly important and essential ingredient today in meeting human needs because of: 1. The amount of leisure time today. 2. The nature and substance of much of the "work" in today's society. 3. The changing role of many of the institutions within our culture such as home, family, church, school, and others. 4. The continuing trends of urbanization. 5. The economic standard of living and current life style in today's society. 6. The continued population growth. Fort Wayne. (1985). Department of Parks and Recreation master plan. Unpublished report, Fort Wayne, IN, p. 15. APPENDIK.2: Fort Wayne Internal Image Survey Form (In-house Departmental Analysis) 189 APPENDIX 2: Fort Dayna Internal Image Survey Form (In-house Departmental Analysis) Fort Wayne Department of Parks & Recreation In-Rouse Departmental Analysis Instructions: Please place one check mark in the apprOpriate column for each category item listed: ' Ratings: H-high; M-medium; L-low; N-neutral CATEGORY WEAKNESS H M STRENGTH H N STAFF: A e uate numbers 1e nthusiastic ourteous ervice-min e MONEY: on n eve s ocation wit ees an c at es FACILITIES: A e artment n us i: aintenance na ement stri ution in cit a ct MANAGEMENT: cc 3 on ma in ann n n ormat on va nation ea era 1 es onsive to PROGRAMS: istri ution roce ures ic interests U needs rou 3 Meet communit a ance etween u icit um er 0 art ci ants GENERAL DEPARTMENT: e utation t a resource use ecurit JH/86 APPENDIX 3: Community External Image Assessnent Survey Porn 190 APPENDIX 3: Community External Image Assessment Survey Form Fort Wayne Department of Parks & Recreation Community Image Assessment Instructions: Please place one check mark in the appropriate column for each category item listed: Ratings: H-high; M-medium; L-low; N-neutral WEAKNES H M CATEGORY STRENGTH M L STAFF: Ade uate numbers Skille Courteous Service-minde MONEY: Ade uate undin Allocation between services Fees an char es ro PROGRAMS: Meet communit nee 5 Ba ance between socio-economic u icit Number 0 artici ants FACILITIES: l. 2. ualit Maintenance A ministration Distribution in cit Sa et MANAGEMENT: ecision makin Plannin Coo eration with outside eaders 1 Res onsive to YOU 5 ublic needs GENERAL DEPARTMENT: Re utation O timal resource use Securit JH/86 APPENDIX 4: CNA SURVEY FORM (FOR! NAXNE DEPARTMENT OF PARKS AND RECREATION SURVEY) 191 APPHDIX 4: CNA SURVEY FORM (FORT WAYNE DEPARTMENT OF PARKS AND RECREATION SURVEY) - ,- - w- roar mm Ill-u may... DEPARTMENT OF PARKS AND RECREATION SURVEY " 4‘3"“ M I“. The purpose of this survey is to get an accurate picture of how Fort Wayne residents use their u, city's public parks. activities. and recreational facilities. and how they feel these can be improved to meet public needs more effectively. Please complete the following questionnaire as accurately as possible. In most cases. you just need to mark an X or J in the box that reflects your views. or to write a brief response Thank you for your time. 1. Below is a list of ways of informing households of Fort Wayne Department of Parks and Recreation (FW DPR) programs and facilities. Please check the one most important way your household typically learns about FW DPR programs and facilities Check one only. announcement in mail [:1 heard from someone else [:1 school flyer D cable TV (channel 10) C] local newspaper U televisron D called! wrote FW DPR [3 poster [:1 other: C] church bulletin C] PTA newsletter C] please speedy DPR program brochure [3 radio [3 . What would be the best way to inform you about FW DPR programs and facilities? Please check the 9% most important way your household would prefer to learn about FW DPR programs and facilities. Check one only. announcement in mail C] heard from someone else [:3 school ffyer C] cable TV (channel 10) [:1 local newspaper C] television C] called/wrote DPR C] poster C] other: C] church bulletin C] PTA newsletter D please Speedy DPR program brochure C] radio U . Below is a list of recreation programs/activities/facilities currently not offered by Fort Wayne Department of Parks and Recreation (FW DPR) but being considered for expansion or development. Recognizing that funding for these is limited and may require additional tax support. pfeaseindicafemehvdofknportanoebryouhomdioldforEACHitemlisted IMPORTANCE IMPORTANCE m I" m m 0' U 0' N “IS. NEW“. UM m “I“ IEIIIIII UNI 091m Better lighted and surfaced More special events (eg” tennis centers C] D E] El Johnny Appleseed Festival) E] El Cl C] An indoor basketball/volley- More neighborhood centers [3 C] C] E] ball/soccer facility C] C] D [:1 More softball/ baseball fields [3 C] [3 C] More evening/weekend pro- New teen center [:1 C] D [:1 grams at Senior Center [:1 C] C] C] More outdoor education pro- Programmlng for special pop- grams (eg. nature hikes) C] C] C] U ufations (e.g.. swimming for More youth sports programs Cl C] C] C] mentally and physically More pavilions C] C] D U handicapped) C] C] D [3 Walking/ running trails C] U [:1 [:1 Tennis center in northem Aerobics classes C] C] C] [:1 half of city C] D [:1 Cl Water theme park [:1 C] C] D New indoor ice facilities [3 Cl C] C] Municipal campground 50 meter (olympic length) expansion C] D C] C] swimming pool C] C] U [:1 Preschool programs [:1 U D C] Fitness/exercise center [:3 C] C] C] More sports programs for More playgrounds U U C] C] females [:1 C1 D U . Please indicate the NUMBER of other people in your household by each age group and sex. The sum of the numbers will equal the total number in your household excluding yourself. FINALE HALE mu Ill! MALE MALE 25-34—— 35-55 FEIALE MALE under 5 5-14 15-19 20-24 over 55 . Below is a list of seven age groups Please rate EACH of the age groups in terms of its total need for recreation programs and facilities In your CHECK ONE FOR EACH AGE GROUP win mm um um men mice we on NO llfGll uruititt will on NO REEO NEED NEED OPINION NEEO NEED leEO OPllllOl Pre-school children (under 6) C] Young adults (20.24) D D D C] Grade school age Adults (25-39) C] C] D U children (6-12) D [I] Cl Cl Middle-aged adults (40-64) C] E] E El Teenagers (fa-19) C] C] C] [:1 Older adults (65 and over) [3 C] C] C] 192 6. Below is a list of programs Please indicate for EACH program if your W is aware that the Fort Wayne Department of Parks and Recreation (FW DPR) sponsors such a program. your hotnehold's level at participation in the program in the last 12 months regardless of who sponsors it and whether your household participated in a FW DPR sponsored program LEVELOFPARTICIPATION IsAglAREMFWDPR IriIieUIRInonhreg-dbeolwhoaponeorsi PercipaledinFVlDPR modem Wm MCKONEFOREACHPROGRAMHMW mm TWICE/NONI TWICE/ION" YES "0 UN! on I. “A“ II SEASON W SEASON YES "U A Adult Basketball Leagues D C] C] D C] U C] D C] a Youth Basketball Leagues Cl D D C] D D D E] Cl C. Craft Workshops [2] D C] D [I] D D D [If D. Day camp I] D D C] C] D [:1 U C] E. Fitness classes C] D C] D C] D C] C] C] F. Outdoor Concerts [:1 D C] C] [3 C] D C] C] G. indoor Hockey C] D E] [3 C] C] [I] E] D H. Summer Playground program C] D C] C] C] U C] U C] Senior citizen programs: I. Education (eg. tax assistance) [3 C] C] C] C] C] C] C] [:1 J, ReCreatlon (e.g.. arts 8- crafts) C] D U D C] C] D U C] KTrips 8. travel [:1 C] [3 C] D D U C] C] L. Figure Skating C] D D [I] D D E] Cl C] M. Softball Leagues D C] E] D C] [I] [I] C] D N. Adult Soccer Leagues U C] D C] U C] D C] D 0. Youth Soccer Programs [3 C] D C] C] C] C] C] D P Learn to Swim C] [:1 U U D D C] C] D 0. Adult Tennis Lessons C] C] D C] U D C] C] D R. Youth Tennis Lessons C] D C] C] D D C] C] C] S. Adult Tennis Leagues C] D C] D C] C] D C] C] T. Volleyball Leagues [3 D [:1 C] D D D D D U. Spech Activities Programs (e.g.. Easter Egg Hunt Children's Parade) D D [3 D D D D C] C] 7. Below are listed some reasons why people often choose to participate in recreation programs. From the list of programs in the previous question. please identify by letter the program that your household participated in most in the past 12 months. If your household participated in none of the programs listed in the prewous question. please go directly to question 8. The one program your household particrpated most in the fast 12 months was choose 1 only For that program. rank the top THREE reasons why your household partiCipated in that program INOICATEOYNUHTHETHREEMOSTIMPORTANT “1”=rnoetbnporhnl “2”=eecondmoathnporul “3"=Iirdrnoatlmportanf able to use/spend time with other members of household interesting program attractive. clean faCifity improvmg skill level located closer to home opportunity to relax low cost of program/"good value for your dollar" public transportation available to program convenient hours of operation meeting and being With others convenient parking other: please describe briefly 8. Below are listed some reasons why people often choose not to participate in recreation programs. From the list of programs in question 6. please identify by letter the program in which your household was most interested but in which the household did not participate in the last 12 months. That one program in which your household was most interested but did not participate in the last 12 months was choose 1 only For that program. rank the top THREE reasons why your household dld not participate in that program. INDICATE BY NUMBER THE THREE HOST IMPORTANT "t"=rnoetlmportant “2"=secondinoethnport-it “3"=Ihlrdmoetlmportant cost of program too high lack of time distance too far too crowded inconvenient hours of operation program conducted in an unattractive facility lack of convenient parking program not offered for right age or ability lack of skill in program unsafe location lack of detailed information on program other: please describe briefly 193 9A BelowisalistofactivitieaPleaseindlcateforEACHactMtyflyaahunetnldlsawarematmeFonWayneDepartnentofPantsand Recreation(FWDPR)providessuchanactivityyourhouaehold’slevefofpartlcipationintheactivitylnthelasttzmonthsregardlooe ofwhoprovidesitandwhetheryourhouseholdusesaFWDPRlacilityatleastpartofthetime. LEVEL OF mutton IsAVIAREIiatFVIDPR Inhhutlmwawheproiitdeehemy undrwomma m an edvly led put oldie Great ONE FOR EACH acnvm all! null m m mics/mm in NO unlit out! iii an. ill sum lli sum ta fill mun A Basketball [:1 C] C] C] D C] a Cross-Country skiing [I] C] C] E] Cl C] C] C] Cl C] 0. Ice skating C] C] C] C] C] D E] Cl C] C] 0. Golf D C] C] D C] C] D Cl C] C] E. Racquetball C] E] C] D D D Cl [3 C] D F. Running U D C] C] D C] C] C] D C] G. Softball [3 C] C] [I] D D E] E] El D H. Swimming [1 C] C] C] U C] D C] C] C] I. Tennis C] C] D C] D C] C] C] C] C] J. Walking E] E] Cl E] Cl C] C] C] E] [3 9a Below is a list of facilities Please indicate for EACH facility if your household is aware that Fort Wayne Department of Parks and Recreation (FW DPR) maintains the faculty and your household's level of participation in the faCility in the last 12 months. LEVELOFWTION lsAWAREMFWDPR hltebllzm Whom CHECKONEFOREACHFACIUTY ME TIM ONCE/IOU“ mm TWICE/NON" YES NO NONE ONCE ll m II 8080' IN “MI K Diehm museum [:1 C] C] D C] D C] L. Fitness Trail [3 C] C] Cl C] D C] M. Foellinger/Freimann Conservatory C] C] D D U C] D N. Foellinger Theater E] Cl C] E] D E] C] 0. Gardens (Lakeside. Foster. etc.) Cl C] C] C] C] C] C] P. Neighborhood Recreation Centers [:1 U C] C] D D D 0. Parks/ pavilions C] C] C] C] C] C] C} R Rivergreenway Cl C] D D D C] C] S. Senior Center C] U C] C] C] C] C] 1’. Fort Wayne Children's 200 U C] D C] C] D U 10. Below are listed some reasons why people often choose to use/visit a recreation facility. From the list of activities/facilities in question 9A and 98. please identify by letter the activity/facility that your hotnehold did/visited most in the last 12 months If your household did/visited none of the activities/facilities listed in the previous question. please go directly to question 11. The one actiVity/facuity your hotnehold did/visited most in the last 12 months was _______. For that activity/facility. rank the top THREE reasons why your household did/visited it choose 1 only INDICATE BY muses THE THREE MOST IMPORTANT “t"=rnoethnporhnl "2"=secondmoetm “O"=I'ibdmoetlnperhnt able to use/spend time with other members of household _ convenient parking __ attractive. clean facility __ interesting activity/facility __ improving skill level __ close to where household lives __ low cost of activity/ facility: opportunity to relax _ “Good value for your dollar” __ public transportation available to facility .— convenient hours of operation __ meeting and being with others .— other: _ 9A and 98. please identify by letter the activity/facility that you homehold was most interested in doing/visiting but did not in the last 12 months The one activity/facility your household did/visited most in the last 12 months was _______. For that activity/facilin rank the top THREEreaeonawhyyouhouseholdddnotdo/visitit. 6'10““le INOICATEOYNUIARERTNETINIEEIIOBTINPORTANT "t" =moetinportant “2"=secondmoathlportmt “3":me cost of activity/admission too high __ lack of time __ distance too far __ not offered for right age or ability __ inconvenient hours of operation __ too crowded __._... lack of convenient parking _ unattractive facility __ lack of skill in activity __ unsafe location __ lack of detailed information on activity/facility _ other: __ please describe briefly PLEASE PROCEED TO NEXT PAGE 191+ 12. BelowareseveralstatementsabouttheFWDPR Pleaseindicabyourdegreedagmtadisagmnbycheckingmofmefive 14. 15. 2 . 22. 23. d 24. boxestorEACHeuemuIt. 2 § 5 i The FW DPR is an important provider of recreation to me The FW DPR charges too much to use its programs and facilities I usually use private rather than public recreation facilities I am well informed about the FW DPR activities I am generally satisfied with the FW DPR The FW DPR spends its tax dollars wisely Of all the tax dollars spent in my neighborhood. more sh0uld be allocated to parks and recreation Fort Wayne and Allen County should combine their parks and recreation departments The PW DPR is an important provider of recreation to the community I have to travel too far to participate in FW DPR programs and facilities that i am interested in I have found FW DPR employees to be helpful and efficient I would be willing to pay more tax dollars for additional park and recreation facilities in my neighborhood I would like to see a FW DPR health/fitness recreation center built a a DD D D a DDDDD as: D U DD D U D DUDDD D: D U DO U D D DDDDD DE 0 a DD 0 a 0 GUESS Di D D DD 0 D D DDDDD DEE In your opinion. what is the most outstanding thing about the FW DPR? In your opinion. what is least desirable thing about the FW DPR? Are there any FW DPR facilities that members of your household do not use because of concerns about safety or security? YES C] no C] lion list all In nouns C] If yes. please identify . Is there anything that we have overlooked in this survey that you feel should be considered by FW DPR in terms of ei'her current or future programslactivities/facilities? . You have lived within the city limits of Fort Wayne: lessthan6monthsD 6months-2yearsC] 2-5yearsC] 6 - 15 years [3 more than 15 years [3 Live outside city limits C] Please indicate your highest educational level: not high school graduate C] high school graduate [:1 some college Cl college graduate I] post graduate college [:1 trade/vocational school C] Your race/origin is: black D oriental CI white C] hlspanic [:1 other: Your sex is female U male D You are: married [:1 single C] single head of household C] Your age is“ The total yearly household income of a! household members is: up to 59,999 El $10,000 - 519,999 C] $20,000 - 534999 E] 535000 - 549,999 El over 350,000 C] Does your household generally have access to an automobile to provide transportation to FW DPR programs/activities/faCllities? yes C] NO [3 APPENDIX 5: Competition Survey Porn (Fort: Wayne Leisure Service Agency Survey) 195 APPENDIX 5: Competition Survey Port (Fort Hayne Leisure Service Agency Survey) SURVEY INSTRUMENT for interviews with leisure service providers in Fort Wayne Metro Area. Name of organization Address Zone # Telephone number Agency/organizational classification: Public Private Other: Non-profit Length of service in Fort Wayne area: Number of years or Opening date: Number of months month year Description of recreation services provided: (Please attach program brochures, if available.) PLEASE PRINT RESPONSE. A. Briefly describe the type and number of programs offered. B. Scheduled hours of service: Weekday hours - - (Mon.-Fri.) - Weekend hours - - pm am pm 196 Survey Instrument, Leisure Service Providers Page 2 C. Location(s) where the program is offered (i.e., name of facili- ty, neighborhood, etc.). D. Briefly describe the targeted client group the program(s) were designed to reach (include reference to age, gender, race, neighborhood of residency, income, occupation, education, and skill/experience level, as appropriate). E. Has the organization been successful in obtaining participation from its targeted group? Yes No Unsure 7. Size of program staff used to provide leisure services: # of full-time employees # of part-time employees 8. Briefly describe the facilities made available for provision of leisure services (include reference to number and sizes of pools, courts, gyms, type of athletic/exercise equipment, etc.). 9. Briefly describe the major form of advertising/promotion methods used by the organization for attracting leisure service-related participation (identify medium-~television, radio, newspaper, magazines, direct mail, flyers/posters, etc.--and estimate of frequency with which medium is used. 197 Survey Instrument, Leisure Service Providers Page 3 10. ll. 12. 13. 14. Does the organization plan to expand or cut back on the scope of leisure service activities in the next year? Yes No Unsure If yes, please briefly describe the extent of expansion/reduction of services: Briefly describe the general geographic neighborhoods of the Fort Wayne area where most of the clients who currently use the leisure program services reside? What are the major problems or needs the agency experiences in the provision of its leisure service program(s)? (Reference money, competition, facilities, staffing, publicity, location, etc.) What other agencies/organizations, if any, are considered to be major competitors to the leisure programs provided at this agency? Are there any participant fees or charges associated with leisure program offerings? Yes No 198 Survey Instrument, Leisure Service Providers Page 4 15. 16. If yes, please briefly describe the fee schedule: Does this organization have: (If answered yes to below questions, please describe the situation.) (a) A local (Fort Wayne) board of directors? Yes No Description (b) An affiliation to a parent company? 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