How business organizes for scientific product planning

Companies often take different approaches to the problem of product development. The reason for this is quite simple: formal product development is a new activity in most businesses. For this reason, the type of organization for this activity is undergoing constant and often drastic change, as individual firms seek the "one best way" for them.
Before the adoption of the marketing concept (i.e., market-oriented thinking), product-planning was largely a function of engineering, and, in the typical organization, engineering was part of the general manufacturing department. With the widespread adoption of the newer marketing concept, product-planning has been generally moved into the marketing department.
In the typical customer-oriented organization, product planning and development are part of marketing services, along with marketing research, advertising and promotion, and other services grouped together in the modern marketing organization. This is logical in view of the fact that modern marketing starts with the customer, and all company decisions are made in the light of the customer's need and of the requirements of the market.

In many companies, particularly the larger ones, the most recent development is the product division. Not all companies call them divisions, but most of them use the same approach: from one to ten products are grouped together in a product division, with a general manager (often a vice president) responsible for production and marketing.
In essence, divisions are small, semi-independent companies within the corporation. Since they have responsibility for results, they have full authority for production and marketing. Product planning and development is placed in the product division. This makes a simpler and more straightforward organization. It permits the division, which is responsible for research, manufacturing and selling, to design the products.
If there are several divisions-the General Electric Co. has 110 divisions, while some important industrial chemical companies have ten divisions, and others only four-it may be necessary to provide for a coordinating committee to avoid duplication. Since many products have more than one use or application, several divisions may often be working on the same product. To avoid duplication and its attendant complications, some companies provide a corporate-level (top corporate management) coordinating committee.