A functional marketing organization refers to the concentration of the responsibility for marketing activities such as knowledge and skills, within a group of specialists in the organization. The benefits of functional structures are well documented and include enhanced efficiency and ability to develop specific, characteristic capabilities The risks include the challenge of coordination between specific functions, inter-functional conflict, functional bias, and over specified.
A marketing process organization refers to the dispersal of marketing activities such as knowledge and skills, across non-specialists in the organization. This approach can take a variety of forms. For example, Kohli and Jaworski (1990) defined market orientation as the organization wide generation, dissemination, and responsiveness to market intelligence. Consistent with a process structure, they suggest that a market orientation involves multiple departments sharing information about customers and engaging in activities designed to meet customer’s needs. There are two key cross-functional processes of market-driven organizations: market-sensing and customer-linking activities.