“Big companies can’t change quickly. Every big company’s gotta be a small company in their head. You want the muscle of a big company, and the soul of a small company.”- Jack Welch
“In a competitive world, organisations are realising that only people can brand products or services effectively – that we are not just selling a branded product but a mass of branded people who support and deliver it.” Helena Rubenstein
A few years ago, George Stalk, Jr. and Rob Lachenauer wrote in the Harvard Business Review about their apparent disgust for what they termed “squishy issues— leadership, corporate culture, customer care, knowledge management, talent management, employee empowerment, and the like.” While begrudging how the situation “has encouraged the making of softball players” they pushed the envelope for “Hardball players”, who are “relentless, and ruthless, in dealing with competitors” and “pursue with a single-minded focus competitive advantage and the benefits it offers.”
Imagine the duo seated in the boardroom at the receiving end of Jack Welch’s admonition to “Forget outside competition when your own worst enemy is the way you communicate with one another internally”. In truth, what would it profit an organization if, to keep a pot of dinner safe in the kitchen, they kept a six-foot-plus guard armed to the teeth at the gate when no care was taken to plug the mouse hole under the stove?
The duo’s position- and loathing- seems to have stemmed from their (mis)perception that those “soft issues” have no place in the corporate trenches. However, brand guru, Gordon Cook, argues that “We must end the absurd disconnect between brand and business outcomes”, because “The visions and implicit purposes of companies must link directly to the brand”. He stated further that “Enlightened companies and CEOs see the purpose of business being the creation of value”. And value, like beauty, is in the eye of the beholder, i.e., the customer’s experience of the brand.
Not reputed as a squishy entrepreneur, the maverick Sir Richard Branson (described as the “front runner and lifestyle guarantor” of the brand he had created) said that “At its heart, business is not about formality, or winning, or the ‘bottom line’, or profit or trade, or commerce, or any of the things the business books tell you it’s about. Business is what concerns us. If you care about something enough to do something about it, you’re in business…It shouldn’t be something outside of yourself. It shouldn’t be something you can stand away from.”
Whether a company is obsessed with squashing its competitors in a dog-eat-dog world or high on engaging its employees and customers, Edgar Schein offers that “How a company sees itself is its internal culture or religion. How others see it is its external market position or brand persona, its brand promise. [And] How a company wants to be perceived is its brand mission.” This is because “Whether or not a culture is “good or bad”, “functionally effective” or not, depends not on the culture alone, but on the relationship of the culture to the environment in which it exists.”
To optimize this important relationship, branding should never be treated as a one-off project or a terminable process. But as something you work on and build over time because seeing it reflects the reputation of your business- so that your people think, speak and behave consistently in ways that reflect your brand values and business priorities.
Organisations tend to see their business strategies as superior or infinitely more important than their brand strategies. However, both make up the two sides of the corporate ‘coin’. Indeed, brand management is not a one-off project that ends with ‘branding’ or a one-dimensional exercise resident in the marketing communications department. Brand management goes beyond the tangibles of advertising, etc. It is about the raison d’etre of your brand. That is, why are you in business?
Branding activities with an immediate selling aim may appear more productive, hence the popularity of marketing promotions and similar tactics. But short-lived purchase inducement and visibility should not be the ultimate goal of a brand building effort.
The brand embodies the ‘heart and soul’ of an organization, and its promise is delivered through its products, services and consumer communication. In an age where the customer drives the conversation about brands, the degree to which brand values are communicated is directly related to how much consumers buy into the actions of the company and its vision or long-term perspective.
Essentially, brand management is about executing your brand promise- which you have communicated explicitly or implicitly to your market.
As technology increasingly becomes plug and play, corporate culture will assume an even bigger role than IT systems will play in the war for customers- Louis Musante
The imagery of “leaking bucket” depicts the business as a bucket and customers as the water in the bucket. “Leaking”, according to Chirantan Basu, indicates that “a business is losing customers and market share.” Whereas changing customer tastes or needs are uncontrollable causes of leaking, the organisation stands a good chance of surmounting controllable causes such as uncompetitive pricing and poor customer service.
Regarding customer service, the leaking bucket describes a situation where external campaigns are successful but delivery gaps occasioned by employees’ inability or unwillingness to follow through on the brand promise, inevitably undermines the performance of the brand, and its long term potential.
This is aptly captured by the Harris Interactive Report conducted in the UK, which revealed that “86% of consumers quit doing business with a company because of a bad customer experience”. Melinda Nykamp and Carol Rozwell also observed that, “Customers make the decision to do business with one organization over another based on more than just product or price- they make their decisions based on their overall experience, which includes sales, service, recognition and support.”
Without a doubt marketing helps to generate awareness among target customers and establish meaningful distinction from competitors. But the company’s brand building efforts should not be limited to external communications.
As Bayo Adekanmbi noted, “Its “faithless” spending millions…on high-impact advertising and brand communication programs, yet devote little or no resources to make sure people inside the company understand and “buy into” what the brand is all about”. And Jennifer Rice cautions that, “If a company’s actions don’t match its words, the brand is simply a facade that customers so clearly see through.” And they react to it by withdrawing their support (patronage).
The situation calls for a rethink, as offered by Colin Mitchell: “It is a truth of business that if employees do not care about their company, they will in the end contribute to its demise. And it’s up to you to give them a reason to care. You tell customers what makes you great. Do your employees know?” Indeed, how can an organization deliver its promise if its frontline employees don’t know (or care about) what it stands for- through “the walk-in ambience, call centre response, problem resolution via email etc”?
Simply put, “Internal stakeholders must first believe before you can make a believer out of somebody else.” And the attitude to internal communication should be “taken as a task of persuasion, not information”.
Increasingly, business leaders are recognizing that there is little point in investing large sums in advertising and design if the reality of employee behaviour weakens those well honed messages of product and service superiority. Or what shall it profit the company- under the CEO’s watch- if it produces the best advertising messages yet lose customers because staff fail to deliver on the promise?
Clearly, by ensuring that every point of contact with the customer- whether in person or online- communicates and reinforce the promise, brands can avoid what B.J. Bueno described as the Revolving Door Syndrome, where “companies invest big advertising dollars to drive traffic but offer little reason for the customer to stay or return again”.
When an organization’s external communications or actions “align with its internal culture, the brand resonates with authenticity” asserts Gordon Cook, whose perspective is shared by Martin Neumeier, thus “If a brand looks like a duck, quacks like a duck, and swims like a duck, then it must be a duck. If it swims like a dog- people start to wonder”.
Delivering positive customer experience cannot occur in a vacuum. So, there must be clear communication of purpose; established processes and engaged people to deliver it consistently. In the words of John Moore, brands “are more than marketing strategies. They are living organisms” that are only sustainable when the things they stand for are consistently brought to life by the employee for the benefit of the customer.
An organisation’s performance “good or bad, creates an overall impression…that shapes how we perceive its strategy, leaders, employees, culture, and other elements” writes Phil Rosenzweig. Hence, the “quest of every high-quality corporate executive is to find the keys to superior performance”.
One of the brutal facts of the business world is its demand of flawless performance on corporate leadership so much so that- in the words of Gary Hamel and C.K. Prahalad- “Too many companies are expending enormous energy simply to reproduce the cost and quality advantages their global competitors already enjoy…So it is not surprising that many executives feel trapped in a seemingly endless game of catch-up, regularly surprised by the new accomplishments of their rivals.” Although, “Companies cannot achieve superior and lasting business performance simply by following a specific set of steps”, Louis Musante is convinced that “When it comes to a sustainable competitive advantage, a company’s culture is one of the most difficult things for competitors to copy.”
In a recent chat about the best business book he’d ever read, Bill Gates waxed lyrical about Business Adventures by John Brooks, recommended- and lent- to him by Warren Buffett. Acknowledging the contemporary relevance of the book, Gates enthused that while “It’s certainly true that many of the particulars of business have changed…the fundamentals have not…The rules for running a strong business and creating value haven’t changed. For one thing, there’s an essential human factor in every business endeavor. It doesn’t matter if you have a perfect product, production plan, and marketing pitch; you’ll still need the right people to lead and implement those plans.”
If we subscribed to Peter Drucker’s assertion that “There is only one definition of a business purpose: to create a customer”, Musante’s view is not dissimilar to Kotter and Heskett’s submission that businesses whose cultures addressed all the key stakeholders- that is, customers, stockholders and employees- and emphasized leadership from managers at all levels outperformed companies without those cultural traits by a significant margin. In a familiar tone, Herb Kelleher stated that “Any business is about providing great customer service to the people you serve”- who “Ultimately…drive the profitability of your business”, according to Scott Jeffrey.
However, Simon Sinek argues that “Nearly every single company on the planet will say publicly that they care about their customers, but most only “care” because their customers are the ones with the money. To REALLY care about customers means you care about them as human beings, not as walking cash dispensers. The best way to see if a company REALLY cares about their customers is to look inside to see if they care about their employees first. 100% of customers are people and 100% of employees are people. A company either cares about people or they don’t. It can’t care about some and not others. That’s like being half pregnant.” Perhaps, Sinek is echoing Southwest Airline’s mantra that “Above all, Employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest Customer”.
Gallup reported that “Companies that engage both their employees and customers gain a 240% boost in performance-related business outcomes. Those companies understand the essential role of human nature in driving performance, especially those critical moments when engaged employees and engaged customers interact.” Emphasizing the necessity of engaging these key stakeholders, management author Richard Daft wrote “Rather than a single-minded focus on profits, today’s managers recognize the importance of staying connected to customers and employees on a daily basis”.
While highlighting Sam Palmisano’s leadership at IBM, Joseph Bower noted that “Customer-facing teams around the world were asked to deliver IBM’s solutions in myriad markets. To help frame the thinking of these dispersed IBMer’s, a three-day, 24-hour on-line town hall was held for some 150,000 employees…to define the values by which IBM would be operated and its people held accountable.”
It must be said that “One of the top frustrations of chief executives is that the organization’s vision is not crystal clear to the employees”, with many a manager querying “Why should we motivate employees to do what they’re already paid to do?” But that would be a red herring, as David Aaker counsels- “Until everyone from your CEO to your receptionist can accurately and consistently articulate your brand’s promise, how do you expect your customers to?” And Jennifer Rice agrees, “What hope is there of a brand engaging customers if it can’t engage its own workers?”
Employee engagement happens during the brand-building process, when the brand promise is actively infused throughout the corporation by the entire leadership team, because “A culture is reflected by how an organisation does things and how its employees talk about how they do things”. If people- customers and essentially, employees- were at the heart of your organisational philosophy, the UK based Stanton Marris organisation is in no doubt that “by addressing what people feel within the organisation you can identify and manage your organisation’s energy…level and direction…purposefully towards results.”
A few years ago, Starbucks got some flak for shutting down every one of its over seven thousand U.S. stores for two hours to conduct a “partner” (i.e. employee) training event in the company’s efforts to “renew its focus on the customer”. Founder, Howard Shultz explained that “Our unprecedented level of commitment to and investment in our people will provide them with the tools and resources they need to exceed the expectations of our customers.” Closing the stores sent an unmistakable message that Schultz was serious about his expectations that all 135,000 Starbucks employees deliver on the brand promise.
On the other hand, a 2001 University of Michigan study on customer service ranked McDonald’s among the poorest performers relative to customer satisfaction, noting that it failed to demonstrate its organizational values and deliver on its brand promise – to provide outstanding service, quality, value, cleanliness; and to have every customer in every restaurant smile. In contrast to those external messages, the study noted that the top five complaints by McDonald’s customers were rude employees; being out of Happy Meal toys; slow service; missing product/wrong order; and unclean restaurants. As per the study, “poor customer service may be costing McDonald’s up to $750 million per year in lost business.”
MacLaverty, McQuillan and Oddie noted in their Internal Branding Best Practices Study that “The more we have studied internal branding the more convinced we have become of the crucial role internal branding plays in the successful implementation of business strategy. A company’s most powerful means of delivering a defined brand experience is through the intermediation of its employees and by effectively delivering on the brand promise. Only in this way can business strategy successfully be executed, enabling business plans to be achieved. Or put more succinctly – ignore internal branding and you are likely to imperil your business.”
Internal branding, according to them, “is the set of strategic processes that align and empower employees to deliver the appropriate customer experience in a consistent fashion. These processes include, but are not limited to, internal communications, training support, leadership practices, reward & recognition programs, recruitment practices and sustainability factors.”
With a screaming headline, “Don’t Neglect Internal Branding”, Steve Mckee wrote in BusinesWeek that “internal branding is simply having a continuous process in place by which you ensure your employees understand the “who” and “why” behind your business proposition.” It is partly internal communications, but goes beyond the typical staff memos and HR updates. While it is related to training, it is about much more than the “how” of what needs to be done.”
Internal branding is increasingly seen as a cost-effective way to motivate employees to optimize performance and sales, yet I must admit that it is not a popular concept, in so far as the default mode for most companies is to focus entirely on marketing efforts aimed at promoting the brand to consumers. However, to live up to the “hype”, it is necessary to take care of your internal processes, that is, to ensure that your people and practices are aligned to your company’s values, whereby everyone who is a part of your organization believes in and reproduces those values.
This is what internal branding seeks to achieve. You cannot produce a good marketing message to the public unless you start from within. Or how can you expect to make customers loyal to something your employees don’t feel loyal to themselves?
Such contemplation mirrors Karen Alsfine’s thesis that “The real value of brand lies in how it manifests in the people who deliver on the brand promise.” Similarly, Leslie de Chernatony observes that, “Branding promises are wasted unless employees understand the brand promise; are committed to delivering the brand promise; and are more likely to genuinely deliver an authentic brand experience when their values align with the espoused values of the brand.” And just as I am wont to say, “In business, as in brands, never make promises you have no intention of keeping or that you may find difficult to keep.”
In response to his own poser, ‘Internal branding- What exactly is it?’ Allan Steinmetz offers that “Internal branding is a cultural shift within an organization, where the employees become more customer focused and more business focused. Internal branding, done well, allows employees to transition from being “Informed,” to “Understanding” the information, to becoming “Committed”, so that they “Change Their Behavior’ in support of the company goals…When all is said and done, successful internal branding lifts brand equity, customer focus and ultimately shareholder value.”
An iceberg is said to be 90 per cent hidden beneath the water. Thus, much of what is visible pales in comparison to the mountainous mass that lies under the surface. As a metaphor, this fits the description of organizations, which have only a small proportion of their brand’s power visible, while the rest is intangible. Little wonder Herb Kelleher insisted that “It is the intangibles that are the hardest thing for a competitor to imitate.”
That is not to say that external elements (logo, colours, name, advertising, etc.) which help to make it “easier for over-stimulated consumers to make buying decisions” should be diminished, but that the leadership of organizations must pay particular attention to culture, values, processes, work relationships and interactions, since actual ‘real-time’ perceptions and opinions are formed upon interaction with the brand across its various touch points.
Moreover, a brand is not a mere abstraction, but a corollary of deliberate actions that produce impressions customers have upon interacting with the brand- be it a product, service or corporation. A point corroborated by Phil Askham and Susannah Feeley, both of Interbrand Inside, who wrote in ‘360 Branding’ that, “brands are only sustainable when the things they stand for are consistently brought to life by the employee for the customer. The truth is that investing in external brand awareness is a false economy if the customer experiences something different.”
For that reason, effective brand management requires attention to critical elements like employee engagement and delivery of brand values. In essence, “An engaged organisation is a talking, listening and learning organisation. [Consequently] Effective engagement breeds a sense of community.”
At Indent Communications, our internal branding solution has a key dimension called ICEbreaker. Basically, it seeks to align internal communication and work processes to the mission of the organisation. And by mission, we are not simply referring to the mission statement, but the strategic intent of the organisation, to wit, “Why are we in business?”
Just like an icebreaker/ice boat breaks up ice and keeps channels open for navigation, we ensure that channels of communication and connection are open inside organizations by defrosting cold, rigid, frosty ways of relating and working- in which employees across organizational structure and functions appear frozen in their mental, emotional or procedural silos. It is difficult if not impossible to get productive work done in such frigid work environments. That is why organizations with unengaged employees contend with “decreasing productivity and customer goodwill”.
The importance of workplace communication and connection cannot be overemphasized. Roger Addison and Carol Haig observed that while a “formal organization chart” represents reporting relationships and components of the work environment, it does not truly depict how work gets done in the organization. According to them, “the real organisational chart shows how people share information and who they connect with to accomplish their work.”
In the last few years, branding has become a buzzword in the field of marketing communication as well as corporate development. Although without a universally accepted definition, it is seen as a combination of elements such as name, price, packaging, advertising and the nature of the product itself. It is worth noting however, that creating an advertising message that promised to satisfy customers’ need without doing so in practice would erode rather than enhance the brand as “many companies fail to deliver on the brand promise that their brand, implicitly or explicitly, makes to customers”.
In his illuminating piece on the implications of effective brand management, Mark Allen Roberts argues that “to talk about branding alone is not enough. Companies must brand with intention. Branding with intention means consciously deciding who you are, what you represent in the space you choose to play in, and most importantly, clearly defining your value proposition.”
He continues, “It is important to understand that consumers will establish a perception of your brand if it is not clear. This leads to what I refer to as ‘branding by default’. Based on lack of information, the market defines your brand for you, accurate or not. Companies that choose to be intentional in all they do experience explosive growth and ultimately become industry leaders.”
One such company is Southwest Airlines, whose co-founder Herb Kelleher is reputed for his claim that profits are a by-product of customer service. Under his leadership, Southwest Airlines became “the most consistently profitable, productive, and cost-efficient carrier” in its industry. Herb had categorically stated that “What keeps me awake at night are the intangibles. It’s the intangibles that are the hardest thing for a competitor to imitate. The spirit of the company is the most difficult to emulate. So, my biggest concern is that somehow through inattention, through misunderstanding, we lose the culture, the spirit. That is our most competitive asset.”
Similarly, Dennis Hahn submits that “Branding is a process that takes place constantly in every interaction between a company and its audience whether a company intends it or not. This includes interactions between a company truck driver and the woman who passes him on the freeway, between a man and a products instruction booklet, even in a short conversation between a receptionist and someone who has called the wrong number.”
All of these interactions with a company, its products or its services leave impressions- which accumulate to form a “living memory” in the minds of individuals and a “collective perception” across a wider audience- thus, reinforcing the ethos of branding as a process through which a cohesive, enduring impression of a business, product or service is formed.
From the foregoing, it is clear that branding is fundamentally not a marketing issue but a behaviour issue, as it has a bearing on actions and, ultimately, performance and results- in so doing, making it imperative for organisations to be intentional in everything they say and do; for it is only when its activities are aligned and integrated that an organisation can achieve its business goals.
Needless to say that branding is an organic endeavour; seeing that its real value lies in how it manifests in the people who deliver on the brand promise, against the backdrop that a brand’s values must be clearly understood and consistently delivered by everyone- from the executive suite to the mail room. This is especially true if a business understands that “branding begins at home.”