Each marking firm or organization is attempting to have an output of something. This is true whether it is a meat processor, a commission man, or a marketing channel consisting of many firms. Each is using as an input resources that are costly and scarce. Each hopes to find a satisfactory solution as to how to combine these input resources to secure a satisfactory output. Here we find the motives to develop and adopt technology, new products, and different organization that may be cost reducing or output enhancing. It is in this system context that the discipline of economics and the various physical and engineering sciences make their major contributions to understanding marketing.

All firms and groups of firms have status and a vested interest in the present role they are playing. They may have developed a reputation for quality, being leaders, having a community conscience, being soundly conservative, or the fastest growing. No flippant decisions will be made that might deteriorate their particular niche of power, and means will actively be sought to enhance it. It is in this framework that we can understand the urge of many firms to grow and expand, to be innovators or followers, and so forth. Economic theories of monopoly and imperfect competition behavior, as well as the political scientists’ concern with power behavior, give insights into this system of behavior.

Communication system

Once a firm or organization develops beyond the simple unit of a unified manager-laborer, the problem of getting appropriate information to the manager and of transmitting his decisions into actions by other workers becomes of increasing importance. Each firm or organization of firms can be viewed as a communication system. How to establish effective channels of information and direction is a major problem of large firms and complex organizations. Desirable actions may be frustrated by not receiving the right information or by misinterpretation of the messages of action. It is in this area that the concern of psychology, sociology, and business management over the proper ways to organize and direct subordinate workers and units becomes of particular relevance.

Adaptive behavior system

Change is an essential characteristic of marketing and one of the major problems of marketing firms and organizations is how to adapt to change. The behavioral system for adapting to internal and external change is then a major component of the firm or organization. As a rule, firms desire to survive and are prepared to pay some price to do so. The adaptive behavior system is concerned with survival in the market place. Any marketing firm operates within a given environment- political, social cultural, economic. Environment is complex and firms must incorporate ways and means of ensuring that they survive year to year. Internal environment includes motivation of employees, wrangling, dissatisfaction etc. while external environment includes global recession and other developments outside the control of the firm. Management must recognize changes that occur in the environment and be able to effectively devise adaptive solutions to those changes / problems. How to operate in a manner that would assure that important changes are identified and adaptive solutions to these changes are effectively evolved is a major area of behavior.