Insights
To contribute to understanding and knowledge development, this page contains a brief description and clarification of several key topics relevant to identity and brand management.
Background information & references
To contribute to understanding and knowledge development, this page contains a brief description and clarification of the following key topics relevant to identity and brand management:
corporate identity
The Concept
Selecting Identity traits
Although it may be hard to assess, every organization has its own set of specific characteristics which make it one of a kind. To differentiate themselves from the competition, organizations need to find out what these unique identity elements are. Albert and Whetten (1985) proposed the following three (3) criteria for describing organizational identity traits that are unique to an individual organization:
Central: what characteristics are widely shared among members throughout the organization?
Distinctive: what characteristics of the organization appear most unique to members in terms of their ability to differentiate the organization from other similar organizations?
Enduring or continuing: what characteristics of the organization are most used by members to link the past to its present and future?
The traits that define an organization’s identity are numerous and can encompass e.g. company ethos, activities, quality, market position, location, geographical scope, organizational type, structure, process, and culture (Balmer et al., 2008).
different viewpoints
Within any organization, different viewpoints will exist about its most typical characteristics, more in particular between its employees and senior management. For example, what top management sees as the most ideal characteristics (desired identity) and communicates as such (projected identity) may differ from what employees believe to be the core features of the organization (perceived identity). Ideally, the identity types should eventually be in close alignment. If they are not, management should develop a plan to reduce conflicting understandings about the organization and close the gaps.
the identity mix
An organization’s identity is revealed through communication, behavior, and symbolism. Taken together, these forms of expression constitute the corporate identity mix – the means through which an organization manifests its identity to the world (Van Riel and Fombrun, 2007).
corporate branding
The concept
the spillover effect
Increasingly, organizations use the corporate brand (the features of a company that employees, investors, customers, and the public associate with an organization as a whole) as a strategic instrument to cast a positive halo over the organization’s products and services, creating a so-called ‘spillover effect’ (Sullivan, 1990). Besides the visual representation of the corporate brand (name, symbols, and house style), the process of corporate branding involves the selection of specific activities and messaging content designed to create favorable associations and a positive reputation with key stakeholders.
the root positioning
Previous research confirms that organizations with strong corporate brands build their corporate communication around a so-called reputation platform, which describes the organization’s root positioning and makes it instantly recognizable (Fombrun and van Riel, 2004). A strong reputation platform generally reflects the company’s history, strategy, identity, and reputation, and is perceived by both employees and external stakeholders as relevant, realistic, and appealing. Reputation platforms form the basis for the development of an organization’s nomenclature and corporate story.
various branding strategies
There are various models management can use to implement a corporate branding strategy. The most well-known is the model proposed by Olins (1990), who suggested that in principle there are three (3) corporate branding strategies, namely:
(1) monolithic (when an organization uses one name and visual style only), (2) endorsed (when an organization has a group of activities or companies which it endorses with the group name and identity), and (3) branded strategy (when the company operates through a series of brands which may be unrelated to each other or the parent company). In practice, though, organizations usually apply a mix of these strategies.
Selecting a corporate branding strategy is a sensitive process, and the decisive rationale behind it will have to be carefully assessed and evaluated. Research suggests that corporate endorsements should only be pursued when a significant parenting advantage can be achieved. For this, the corporate brand must be strong, known, and appreciated by relevant stakeholders (Van Riel and Fombrun, 2007). There are different levels of endorsements for organizations to consider (weak, medium, and strong), depending on -amongst others- the level of visibility and identification of the corporate brand vs. the local brand in the local market.
integrated communications
To reap the benefits from the corporate brand, organizations should overcome fragmentation and reduce inconsistency in their communications as much as possible. To this end, management should pursue a coherent integrated communication system that can assist in the implementation of strategic objectives, in developing positive stakeholder perceptions, and ultimately in building trust, thereby improving the organization’s overall performance and corporate reputation (Van Riel and Fombrun, 2004).
internal Identification & alignment
among employees
stimulating supportive behavior
As employees are the ones who ultimately implement the organization’s strategic objectives, getting their support and buy-in is vital for any organization’s success. To achieve this, employees need to be able to identify themselves with the organization. They need to know and understand the goal they work toward to show supportive behavior and to make decisions that are consistent with the organization’s objectives. Also, they need to be involved and recognized for the personal contributions they make. Overall, employees want to be proud of the organization they work for.
projecting an attractive identity
Previous research has indicated that the extent to which people identify with an organization is dependent on -amongst others- the attractiveness of its identity, i.e. the extent to which it contributes to employees’ self-esteem, self-consistency, and self-distinctiveness. Therefore, by projecting an attractive identity to employees, managers can increase identification. This can be achieved through effective internal communication and HR management tactics (reward and recognition practices, appraisal processes). Employee identification with the organization is particularly influenced by (1) employee’s own job satisfaction and (2) employee’s perception of the organization’s reputation. To this end, managers should pursue both morale-enhancing and reputation-building initiatives (Van Riel and Fombrun, 2007).
gathering intelligence
Internal identification and alignment can be stimulated by pursuing several managerial efforts, such as informing, motivating, and capability development. For these efforts to be successful, management should gather the necessary fundamental intelligence about their organization, related to (a) its identity (questions such as: who are we? what do we stand for? what is our core purpose? who do we want to be? what doe we actually project? how are we perceived?) and (b) to the current level of employee identification and support for the organization’s strategic objectives (what do employees know and believe about the organization? and how do they behave?).
Internal communication & HR
Once this fundamental information is available and tested, management will have to decide which strategy it will use to build internal alignment. This is often a combination of negotiation (consultation and consensus building) and a confrontation approach (mirroring and power play). In this process, internal communication and HR management play a critical role.
An ongoing process
Building and maintaining employee alignment is not an easy task. Above that, it is ongoing. The benefits of a highly motivated and committed workforce, however, are manifold.
external identification & support
among key stakeholders
Creating emotional appeal
Employee identification and alignment alone is not enough. For reputation building, organizations should also promote external identification through targeted communication addressed to identified stakeholder groups. Stakeholder identification results from emotional appeal – an organization’s ability to evoke perceptions of trust, liking, and respect – a perception of authenticity (Fombrun and Van Riel, 2004: 174).
Stakeholder prioritization
To this end, organizations should begin by prioritizing their stakeholders and develop a profound understanding of the individual stakeholder characteristics, what they know, understand, and believe about the organization. They should assess their relative competitive position and compare the outcome with -amongst others- the desired strategy and expectations of management. Furthermore, organizations need to understand the context in which they operate and assess the impact of e.g. product evaluations, industry reputation, and the dominant trends in public opinion. This process includes the scanning of potential issues that may threaten the organization, particularly the likeliness of their occurrence and probable impact.
effective communication
Based on this information and analysis, management can then decide how to (re)position the organization vis-a-vis its various stakeholders and start building external alignment with the organization’s strategic objectives through consistent communication programs and initiatives. When done well, this is when organizations put themselves out there (are visible) and convey who they are, what they do, and what they stand for (are authentic), in a distinctive, transparent, responsive, and consistent way, expressiveness generates identification with the organization by employees and key stakeholders and contributes positively to reputation building.
a continuing effort
Building and maintaining external alignment is a joint and continuing effort of both communication specialists and management responsible for the realization of the organization’s strategic objectives.
reputation building
the concept
what are reputations?
Reputations receive a lot of attention. However, when asked, people often have difficulty explaining what they are, let alone how they develop. An organization’s reputation can be described in many ways. In general., a reputation is the overall assessment of an organization by its stakeholders, i.e. of how well an organization responds in meeting stakeholder demands and expectations relative to its competitors in the field (Van Riel and Fombrun, 2007). It is an emotional bond, as it were (Reputation Institute). Reputations form over time, they are dynamic, and difficult to duplicate, and can vary across national and other environmental context.
How do reputations develop?
A reputation develops from a company’s ongoing identity-shaping practices, designed to produce favorable perceptions in the minds of its stakeholders. Good reputations are built on the inside of an organization. That is an organization with a solid business model, a credible strategy, a strong culture, good values, and products and services with an appealing customer value proposition.
Meeting stakeholders’ expectations
Building a strong reputation requires meeting stakeholders on the following seven (7) dimensions:
(1) product and services (the organization can deliver high-quality products and services at a good value);
(2) innovation (the organization is innovative and brings new products and services to the market);
(3) workplace (the organization treats its employees well);
(4) governance (the organization is open and honest in the way it does business); (5) leadership (the organization has a clear vision for the future of the company as well as of its industry); (6) citizenship (the organization is a good corporate citizen and takes responsibility for its actions);
(7) performance (the organization delivers strong financial results that will ensure that the company is around for years to come). If an organization is perceived to be delivering on each of the seven dimensions by its stakeholders consistently over time, the increased trust and support will build a strong reputation (Van Riel and Fombrun, 2007). In contrast, if an organization is not perceived to be delivering on these expectations, stakeholders will lose trust, and subsequently will not buy, recommend, invest in, work for, or even give the benefit of the doubt to that organization.
Creating emotional appeal
Strong reputations result when organizations evoke emotional appeal – feelings of trust, respect, and liking among key stakeholders. It requires that organizations are visible and express themselves to their stakeholder communities, convey who they are, what they do, and what they stand for in a distinctive, transparent, consistent way (Fombrun and Van Riel, 2004). This process will have to start internally, designed to get the buy-in from the organization’s employees and to turn them into ambassadors, followed by a process of external expression, aimed at mobilizing key stakeholder support and reputation building.
Corporate reputation management
more important than ever
The downside risk
While organizations increasingly recognize the benefits of having a good reputation, they also experience the downside risk associated with the potential loss of reputational capital. The sophistication of ICT technologies, the community’s changing beliefs and expectations about business, and the demands for more transparency, all underpin the need for organizations to strategically manage their corporate reputation. Public scrutiny and judgment are intense. With one easy push of a button, corporate misbehavior can be exposed, enabling e.g. NGOs to call for massive actions raising questions about a firm’s or industry’s license to operate.
Numerous scandals
Over the past two (2) decades, companies were involved in numerous incidents that harmed their corporate reputation. These incidents range from quality lapses, such as Merck (harmful drug), Volkswagen (software manipulation), UPS (bad delivery service and rogue behavior), environmental pollution, including Shell (Brent Spar, Nigeria), and BP (oil spill), weak internal coordination e.g. American Airlines (bonuses vs huge pay cuts), discrimination practices e.g. KPMG (gender discrimination case), corporate fraud cases as in Enron, Arthur Andersen, WorldCom, and Parmalat, information security breaches, including Yahoo, LinkedIn, Facebook, and Target (ID-theft), tax evasion of e.g. Fonseca, whistle-blowing scandals such as Snowden and PWC staffers (LuxLeaks scandals), unethical marketing practices of .g. ING (sale of customer data), questionable business policies of e.g. Starbuck (guns & coffee), unhealthy working environment of e.g. Harper’s (rejecting science-based evidence), unhealthy competition of e.g. Enron, and so on.
Invaluable asset & great liability
In summary, an organization’s reputation can be an invaluable asset as well as a great liability. Whereas a good reputation is an enduring source of competitive advantage and increases both the financial performance as well as the emotional appeal of an organization, a damaged reputation potentially reduces earnings, market share, and dents stakeholder trust. Considering its importance, a reputation should receive constant management attention in building and maintaining stakeholder support. For effective reputation risk management, organizations must identify which issues and events potentially harm the opinions of their customers, employees, and business partners, and assess these risk events and issues against each of the seven (7) reputation dimensions.
corporate communications
strategic & coordinated
Building sustainable relationships
To be able to meet the pressures in today’s complex and competitive world and to realize strategic objectives, organizations need the full support of their employees. Similarly, organizations are heavily dependent on building and maintaining solid mutual rewarding relationships with their key external stakeholders to allow them to grow and to realize their purpose and strategic objectives. In this process, communication plays a critical role.
Good communication is strategic
To be effective, the communication system must, first of all, serve the organization’s strategic choices (Van Riel and Fombrun, 2007). Organizations should therefore design their communication function in a way that reflects the business strategy. Furthermore, they need to acknowledge that the role of corporate communication is not limited to e.g. the crafting of messages or event organizing.
Earning key stakeholder support and building a strong reputation, of course, demand much more from the communication function. It requires an in-depth knowledge of the organization and a profound understanding of the expectations and beliefs of its key constituents. To this end, the communication professionals need to develop a clear understanding of the organization’s history, strategy, identity, and reputation, and the subsequent analysis of its root positioning, to make an effective contribution to this complex process.
Good communication is expressive
How effectively organizations communicate has a great impact on how they are being perceived by their key stakeholders and the public in general. Through powerful messaging and sense-giving initiatives, organizations can evoke emotional appeal – feelings of trust, respect, and liking among key stakeholder groups. When done well, this is when they convey not only heightened visibility and distinctiveness for the organization, but also transparency, authenticity, and responsiveness in a consistent way, the process of expressiveness can promote identification and supportive behavior, both by employees and external stakeholders, and enhances reputation building (Van Riel and Fombrun, 2007).
Good communication is integrated
To avoid fragmentation and to enhance coordination and consistency in the corporate messaging, organizations should pursue a systematic process for building a fully coordinated communication system inside the organization (Van Riel and Fombrun, 2007). Such an integrated approach is also preferred when companies want to compete with their corporate brand, not only to enhance brand equity but also its overall reputation (Fombrun and Van Riel, 2004).
Besides developing the building blocks for a common ground of understanding about the organization in general (strategy, identity, brand, and corporate story), organizations need to develop tailored strategic communication programs to effectively manage their critical stakeholder relationships, both with employees (internally) and with investors, customers, regulators, and the public at large (externally). As each group has its own dynamic, an isolated approach by the individual communication specialists should be avoided, as this can easily result in the dissemination of different information about the organization’s purpose and strategic objectives.