It does not, however, imply centralized decision authority.
Business policy determines strategic development of industries, sectors and markets. Business policy helps to indicate what changes in present situations may mean for the future and how a company can influence its market destiny. It induces innovative and risk-taking possibilities. By anticipating future situations, it guides present actions, which in turn shape the future. Business policy must not only concern itself with problems of the immediate future, such as the advertising campaign for next year's sales; it must deal with long-range problems as well. Intermediate and long-range marketing intelligence is a basic requisite for planning and decision making (Wheelen 32).
Through its insights into risks and opportunity, Business policy can be used to redirect corporate effort to more profitable objectives. By anticipating changes and treating them as opportunities, it often leads to a redesign of marketing strategy, to development of longer-range perspectives, and to cultivation of a viewpoint of what can be done to adjust the corporate effort. The very bulk of marketing knowledge and the necessities of involving many departments add to the difficulties of obtaining adequate information. United Air Lines attacks this problem through a centralized information center near Chicago that accumulates and digests information from regional centers across the country. This center daily briefs management on the company's performance during the preceding 24 hours, including a digest of the performance of competitors (Wheelen 32).
Business policy determines and stipulates interorganizational relations and strategic choices of companies. Business policy is concerned with social well-being and competition. But, in addition, marketing is rooted in profitable business action. Striking a balance between profitable marketing practice and the national interest presents a difficult challenge. Conflicts may arise. What is best for an individual firm, or what is sound marketing practice for it, may not be consonant with desired goals of society. If business can run itself according to desired social goals, then governmental power and regulation may be kept to a minimum. Competitive markets have proven to be the most progressive economically and the most just socially. A market system responds to the wishes and standards of society. Competition and keen business rivalry assure customers of those items that best satisfy their wants and needs while rewarding the most efficient firms. By so doing, the marketing system serves as both a regulated and a regulating mechanism (Wheelen 88).
Government regulation of marketing is the result of a long evolution of acts, court decisions, and interpretations. It aims to protect our competitive system by seeking to prevent unfair and unreasonable competition, and by assuring entry and growth of competitors. Although it is relatively easy to state desirable goals for government regulations, the design and enforcement of such goals in specific instances, through legal actions and court decisions, is difficult at best. The complexity and multidimensional nature of the marketing process, coupled with its innovative base, indicates the likelihood of some uncertainty about legal issues in marketing (Wheelen 66). Where guidelines are clear,