6
Corporate Brand: Business to Business
Nuno Sequeira, Rui Vinhas da Silva and Sharifah
Faridah Syed Alwi
Learning outcomes
At the end of this chapter, readers should be able to:
1.
Understand the concept of corporate reputation and recognize it as a distinctive
factor of a company positioning
Identify the branding importance on perceived quality, loyalty and customer
expectations
Discuss the importance of stakeholder engagement (in both internal and
external perspectives) in the context of Branding in B2B markets
Outline the main reputation measurement methods
2.
3.
4.
Key points



The concept of reputation includes the notions of image and identity, involving
all stakeholders, irrespective of whether they are customers, partners or
employees.
A brand represents a set of promises, implying confidence and consistency, as
well as a set of expectations
Corporate brands misalignments can represent painful moments which not only
can be injurious but, in extremis, ruinous
In a B2B context there is a tacit expectation that organizational customers expect
tangible benefits from their loyalty
•
Branding has a positive impact on the perceived quality of a product or
service, creates new market opportunities and may also create entry barriers to new
competitors in a particular market
•
In B2B contexts employees have an enhanced role as brand
ambassadors among business customers
•
Industrial buyers also are affected by emotional factors
Introduction
In B2B markets, choosing the wrong business partner can reduce the company’s ability to
survive and thrive into the future. Stakeholder involvement in organizations and the complex
set of interactions between stakeholders and the organization, expressed in formal and
informal relationships and characterized by a wide array of experiences, impressions, facts,
perceptions, beliefs and knowledge, all of these contribute in different measures to
organizational reputation.
Reputation and Strategy
The ultimate aim of an organization is to remain a going concern well into the future. In order
to achieve this, it has to be commercially successful, if not in its early years at least at some
foreseeable point down the line. Companies much in the same way as the products that they
manufacture go through a life cycle. As organizations progress through stages in their lives,
they constantly look for ways in which to become more efficient, permanently seeking out
economies of scale and cost optimization strategies that align with the ultimate corporate
objective, the pursuit of profit. In addition to this, organizations fulfill a crucial social
function, by providing employment to individuals in society, thus contributing to the
development of economic systems, and in this way positively impacting on the quotidian of
the average individual in society.
The importance of the relationship building
The turbulence that has been caused by the financial crisis of the early twenty-first century,
the diversity and complexity of contemporary times, the volatility of organizational life and
in particular its ramifications onto the real economies of nations, has meant profound
technological and geopolitical changes that have occurred in a relatively short time-span. The
recent scandals and collapses also have coalesced with social and environmental protests to
focus research and managerial attention on corporate power and influence and on the
corporate social responsibility issues. This has required from the viewpoint of organizations
the development of novel approaches and ways in which to conduct business that deviate
from the traditional methods. The new approaches are necessarily more based on relational
traits and dimensions, focused on relationship-building and the careful management of
internal and external key stakeholder groups with a view to harmonizing their multiple and
often contradictory perspectives.
Organizations have entered for almost a decade now into a new era, where in addition to
financial performance, they are required to routinely attain excellence in key dimensions of
business sustainability, whilst ensuring that their record remains both unblemished and
reported accurately for the benefit of their stakeholder base. These key dimensions of business
sustainability have been identified as: environmental, social and economic.
Some organizations still see their sole purpose in life as that of engaging in the pursuit of
financial gain. Many organizations however, have begun to recognize the importance of the
social context in which they are embedded as part and parcel of their raison d´étre and a key
driver of success in the attainment of the ultimate corporate objective, that of an organization
remaining a going concern into the foreseeable future. The tacit acknowledgement that there
are competitive advantages to be attained by aligning organizational values with the values
that are subscribed by customers and other external stakeholders has produced opportune
change in organizations. These changes manifested in operational and marketing strategies,
whose purpose is to close those gaps in stakeholder understanding and perception of the
organization, what it is about and what it stands for.
There can no longer be a unidirectional approach from the organization to the outside, but
instead firms need to work with multiple stakeholders, both in and out of the organization.
Firms also need to have embedded in them the pursuit of social welfare agendas, as part of
their modus operandi, and to do this within a wider focus on social responsibility issues. The
operationalization of these concerns also needs to be carefully orchestrated and thoroughly
communicated to a key external constituency, that of investors. In reconciling economic and
social objectives, organizations are also required to ensure, that first and foremost, they
remain attractive prospects for investors. In effect, being perceived to be socially responsible
will signify different things to different stakeholder communities. In generic terms, a wise
running of social responsibility tasks can derive positive outcomes for an organization, and
thus it can it can be argued that social profit is generated. The term social profit, despite being
widely discussed in various forums has not received extensive coverage in the academic
literature, nor has it been debated sufficiently in academic circles.
A company with a hybrid approach is one that is capable of implementing sociallyresponsible practices, whilst simultaneously learning to reduce its cost structures to a
minimum, as well as catering for the wellbeing of other financial variables that are critical to
its business equation. This organization also quickly learns to capitalize on a reputation
anchored on social-responsibility cues. In the end, everyone seems to win. In a sense, and
looking at it from a reputational perspective, every agent, internal or external is part of a
stakeholder community, amongst whom the social dividends that are earned by virtue of the
accumulation of social profit, are required to be shared.
In establishing their commitment to social responsibility, which constitutes a key foundation
of social profit, businesses must develop a solid set of principles and processes to respond
systematically to the needs and wants of key stakeholders, thus ensuring their support. This is
due to the fact that the larger and more visible a company becomes, the greater the
expectations and demands that emanate from the entities with whom the company interacts
and relates to, and to whom it has to respond coherently. Managers must know about entities
in their environment that hold power and have the intent to impose their will upon the firm
however there remain stakeholders who do not have power, but who nevertheless matter to
firms and managers.
Top organizations need to go well beyond enumerating mere lists of values and principles and
laying them out on their websites. Instead they should follow these values and principles to
the letter, using them as guidelines that underpin their strategic development. These
companies gain business competitive advantages from the actions that they carry out, and
those to a great extent need to address a genuine concern for social issues. They also need to
do so in cooperation with different stakeholder constituencies, including key partners and
employees.
In top notch organizations, employees learn that they are part of a vast community in a
business ecosystem, which is self-controlled since every formal relationship within a
hierarchical structure has to be clearly defined. The model that is being proposed here
recognizes that organizations operate in the public interest by actively creating tangible
improvements to the lives of their communities through innovation.
Resource allocation decisions by stakeholders are complex and include myriad
considerations. In maximizing its chances for attaining success across different geographies
and political jurisdictions, companies must build a network of relationships with government
agencies, community organizations and business partners, among others, to ensure that
otherwise conflicting interests may be aligned to the benefit of all concerned, especially when
macro-environmental circumstances change. In effect these stakeholders have no intention of
being used or neglected and are interested in that the organization remains a going concern.
On the other hand, organizations too want to ensure that they do remain viable business
concerns into the foreseeable future. In this sense, the principles and values that these
organizations adhere to simply imply that they are indeed attentive to the needs of the wider
society, and therefore more willing to support investment and innovation activities in order to
address these needs, thus making public entities, and the general public at large, less
suspicious of their true intentions.
This model cannot be designated as one of philanthropy or social responsibility, at least in a
passive sense of compliance with set standards, but more as a social entrepreneurship and
innovation process that needs to be combined with corporate diplomacy. It is safe to state that
corporate reputation represents a key foundation of the market economy. In “The Wealth of
Nations”, Adam Smith addresses the issues of ethics and morals in society and their impact on
economic activity and behaviour, arguing that their absence would likely lead to the
undermining of the very foundations of commercial activity.
There are several definitions for reputation in the respective literatures, from areas as diverse
as economics, marketing and sociology. The concept of reputation includes the notions of
image and identity, involving all stakeholders, irrespective of whether they are customers,
partners or employees. Its approach therefore requires a holistic perspective, and not only a
vision from outside the organization looking in. The relationship between the organization
and a plethora of stakeholders, both internal and external to the company, groups of people
with vested interests in the organization, but with heterogeneous and multifaceted
perspectives on how it should be run is a key attribution of senior management, who are left
with the difficult task of reconciling and balancing what are often conflicting interests and the
recognition of multiple organizational perspectives. Corporate reputation is thus a collective
representation that derives from the accumulation of judgments made about past actions of the
organization and that describe its ability to recognize the value and worth of its multiple
stakeholders. In the end if someone claims that an entity has a clear reputation, this means that
the organization is expected to behave in a consistent and predictable way in certain
circumstances. The distinctive positioning of a company in the minds of its stakeholder
groups is perhaps one of the most important strategic decisions that management are required
to make. Thus, if reputation models are to contribute to the formulation of organizational
strategy, then researchers must determine whether these models can indeed provide a
descriptive theory of how decision-makers should behave.
Corporate reputation and organizational performance are shaped by developments that occur
in the external environment, such as changes in the behaviour of competitors, customers,
governments or other stakeholders. Companies develop winning reputations by creating and
projecting a set of capabilities that their partners recognize as unique. Those who are more
respected, build their name by developing practices that involve economic and social
considerations in their strategies, which in turn have a positive impact on their margins,
employee morale, relationships with vendors and suppliers, among others. Thus,
organizational reputation may be based either on direct stakeholder involvement and
experiences with the company, or derive from deliberate communication from the
organization to its external stakeholders.
Reputation and Branding
A brand represents a set of promises, implying confidence and consistency, as well as a set of
expectations. Strong brands hold a unique position in the consumer's mind and drives to
loyalty. Customers may be loyal because they are satisfied with the supplier or product brand,
and thus want to continue the relationship and communicate one’s experiences that are
positive word-of-mouth. Therefore, in order to optimize the relationship between consumer
and brand, a company must understand the way in which its customers think, act, perform and
understand purchasing decisions. Thus, corporate reputation is not an end in itself, but a vital
condition and a way to create a sound commercial basis.
It is possible to find four fundamental effects of reputation on the survival of an organization
and in the determination of its viability in the long-run: first, reputation influences peoples´
behaviour and buying intentions. Second, for many people who do not have direct experience
with the company, reputation – based on the recommendations from an associate who has
direct experience of the organization’s products or services - can help to guide their
purchasing decisions; third, social responsibility has become an important factor that can be
reflected by reputation. Finally, political power and good public opinion help to build a
favorable reputation that is conducive to the better management of the environment in which
the company operates.
In summary, it can be stated, that successful companies build their communication channels
and relationships within their immediate network of contacts, and these in turn pass these
contacts onto their personal networks, generating a collective buzz, which ultimately leads to
a growth in the notoriety of the organization and an improved reputation should these
comments be favorable.
Over the past few years, several studies have revealed there to be benefits accrued to
organizations, if and when they are capable of effectively managing their intangible assets,
including corporate image or reputation. When these are favorable, the conditions are created
for people to endear to the organization, to like it, to feel that it is somehow familiar, yet
distinctive, and that translates into an important set of competitive advantages that ultimately
lead to enhanced profits, and enable for an improved ability in protecting market-share or
guaranteeing market-leadership.
Top management should be capable of both taking advantage and simultaneously managing
the reputation of an organization with a view to enhancing its market competitiveness.
Intangible assets are thus key elements with regards to their potential for creating entry
barriers. The cues that are associated with intangible assets and what they project also
augments the potential for the retention of customers, thus strengthening competitive
advantages and making these less susceptible to imitation and consequently more sustainable.
Creating and exploiting competitive advantages and making them sustainable, allows
companies to take the lead in their respective markets, rather than accepting subordinate roles
as followers.
In these contemporary times of hardship, when due to the financial crisis and the credit crunch
that soon ensued, organizations were left strapped for credit, as accessing financial capital
became much harder and much more expensive. In these circumstances, a solid reputation can
make all the difference, first with respect to the concession of credit in ceteris paribus
conditions, and then in what positive reputational cues allow for, and that is in the final
analyses a reduced cost of capital as the lender understands the borrower to be in good faith,
due to its immaculate track-record, in other words a solid reputation. Other things being
equal, the profitability of a company grows as its reputation improves.
Reputation is thus an intangible asset with tangible benefits. It can be valued, it may be more
or less sustainable and more or less difficult to replicate by a competitor, but when managed
well, it constitutes a formidable strategic weapon.
Image and Identity: a symbiotic model
Building a strong reputation requires time and the returns on a positive reputation may take
decades before they are realized. It may also take years to build a reputation, but only one foul
or misplaced action can destroy it, and there are numerous examples of that in corporate life.
Corporate reputation is thus the result of a collective assessment of the different stakeholder
groups of the traits and characteristics of an organization based on its identity and image.
However, more than just the way in which employees evaluate a company, its identity and the
way in which the company is perceived by its external stakeholders, its image, reputation is a
phenomenon that is structural and permanent in nature, the aggregated view of internal and
external stakeholders resulting from the way in which it communicates both internally and
externally, corporate behavior, as well as its economic, financial and social acts.
In services markets, reputation plays an important strategic role since the assessment of
service quality before its acquisition is vague and partial, which does not happen with tangible
goods, as these may be tried out and experienced beforehand. Corporate reputation is thus a
very powerful and appreciated strategic mechanism at the disposal of top management in
organizations, an invaluable asset, for which there have been some attempts at measuring its
worth, an asset that can generate significant future income.
A corporate behavior directed at the systematic pursuit of actions geared towards reputation
building is strategically relevant, particularly in a context where players may not be privy to
complete and adequate information. Top management through their strategic decision-making
will shape the way in which in the final analyses customers may be treated or the way in
which the relationship with suppliers may envelop. By looking into relational track-records
with the different stakeholder groups, organizations are capable of ascertaining such key
aspects of their business partners as supplier reliability and compliance with requirements,
and thus, these cues can act as predictors or at least function as good indicators of future
behavior. The non-fulfillment of a promise by the organization has immediate consequences
on its reputation and can seriously affect future actions of third parties before the
organization. Consumers may cease purchasing the organization’s products or services due to
a lowering of quality, increase in prices or to becoming aware of the negative experience of
the organization’s employees. Thus, as an organization’s reputation increases so do
stakeholders’ expectations. In the context of an industrial organization, reputation is critical in
such mundane situations as contractual or labour negotiations, but also in what the building of
a good name for the organization implies for its products, particularly in international settings.
Thus, positive reputational cues provide valuable strategic weapons for organizations, which
can be used in corporate communications strategies with the different target audiences.
The literature on corporate identity is vast and knowledge on this particular theme is perhaps
reaching maturity. As this occurs, other areas outside marketing are showing an interest in the
topic of corporate identity, including the areas of human resources, organizational behavior,
strategy, public relations and others. As stated by Balmer (2012), successful corporate brands
are credible because there is a symbiosis between corporate brand identity and corporate
identity. The literature suggests that the corporate brand should be calibrated with the
corporate identity. Corporate brands misalignments can represent painful moments which not
only can be injurious but, in extremis, ruinouts. Thus, changes in the political, economic,
ethical, social and technological environment can result in changes in strategy and these
changes will shape the identity and, in certain aspects, mould the corporate brand in addition.
What employees say and how they say it, their behavior, the physical aspect of the goods that
a company sells, the quality of service provision, the full package that reaches the final
consumer, these are all elements of communication between the organization and its
customers. Thus, any gaps between identity and image are viewed as potential causes of
crises.
Enron is a case in point when it comes to emphasizing the critical importance of diagnosing
and subsequently narrowing or eliminating these gaps. The company promoted values of
integrity, and that made it possible for Enron to be regarded as one of the most admired
companies as per Fortune´s ranking system, which essentially reflects the views of both peers
and analysts alike. However the way in which employees at Enron viewed the company was
different, as was made abundantly clear by the testimony of whistle blower Sherron Watkins,
who in questioning the accounting methods that had been used for some time eventually
brought everyone´s attention to what was going on, which in the end led to Enron falling from
grace and filing for bankruptcy.
Reputation in B2B markets
Contrary to commercial buyers, who tend to value emotional security when purchasing a
branded good or service that benefits from a strong and positive image, industrial buyers are
usually perceived to be utilitarian in their buying decision-making, evaluating the relative
merits of each transaction, with decisions often being biased towards quantitative criteria. In
spite of the greater attention that has been given to this issue, the most recent research has
ignored the influence of emotional attachment in the context of B2B interactions. In effect,
intangible attributes often shape the relationship between buyers and sellers and emerge as
prominent and important features in the purchasing decision-making process.
Internal stakeholders too have preconceived notions about the organizations that they work
for. The way in which employees and customers perceive a company's reputation will
influence their behaviour and their relationship with the organization. This is particularly true
for service businesses, where employees and customers interact very closely in the delivery of
high quality services. In the services sector, it is highly likely that corporate identity as
perceived by employees evolves along with the image that customers keep with regards to the
organization. Reputation management is also critical in a B2B context in the context of the
business relationships and environment within organizations and the way it acts to shape their
transactions. Achieving and maintaining high market shares or premium prices as a result of a
more capable approach to the attraction and retaining of a strong customer base has to be an
important objective in B2B markets. However, there are customers, particularly in a B2B
context that regularly change their loyalties due to lower prices or better conditions being
offered elsewhere. In a B2B context there is a tacit expectation that organizational customers
expect tangible benefits from their loyalty.
Customers that have been around for some time will tend to pay lower prices than new
customers and in the context of B2B markets loyal customers are more likely to use their
market power to ensure discounts and rebates of one sort or another. The act of returning to
the same vendor all the time may have to do with habit or convenience, but it is also very
comforting to purchase continuously from the same entity and to be familiar with the quality
that it is able to provide, as this means a reduction in ambiguity, time and money savings, and
even disappointments with the quality of the products and services being provided.
Branding in B2B markets has received scarce attention from the academic literature,
unequivocally less than its equivalent conducted in the context of B2C markets, either due to
fewer studies that exist on industrial organizations when contrasted to those that proliferate in
the literature in B2C contexts, or due to the tacit and widely entrenched belief that industrial
buyers are not affected or at least are much less susceptible to the emotional values that are
associated with brands than their B2C counterparts. The latest research however allows for
the conclusion that in both contexts, businesses need to gain trust and develop cognitive and
affective ties with their stakeholders. In fact, branding has a positive impact on the perceived
quality of a product or service and creates new market opportunities for organizations.
Branding may also create entry barriers to new competitors in a particular market and enhance
an organization´s reputation next to key stakeholder constituencies. Senior executives should
become connoisseurs of corporate brand management because corporate brands are a mean to
create both shareholder and stakeholder value. Any failure to effectively nurture a corporate
brand may cause the brand to lose its luster with customers and stakeholders and may result in
the brand emerging as an institutional liability.
Over the past couple of decades, there have been novel ways in which organizations have
begun to look at buyer-seller relationships, and this has been made evident in the way in
which relationship marketing has come into prominence in the marketing literature, and the
focus that has been attributed to the development and maintenance of business relationships.
Trust and commitment have become key concepts and their role in relationship marketing,
particularly in B2B markets has been extensively covered in the marketing literature.
Positive business environments that are based on trust and cooperation are characterized as
being harmonious. Customers need to feel secure when dealing with their suppliers. Trust is
thus considered to be a key element in long-term buyer-seller relationships. Trust
encompasses a spectrum of benefits that encourages cooperation and reduces fear of
opportunistic behaviour by partners, moderating the risk entailed in the buying decisionmaking process. When a relationship is characterized as being one of trust, the costs that are
entailed in negotiating an agreement can be reduced, thus encouraging both seller and buyer
to behave fairly. Trust in the vendor contributes to the creation of loyalty, and brand
management is in this sense key to the portrayal of a good and reliable image of an
organization. Thus, the observed effect between satisfaction and loyalty may be due to a third
variable: the brand reputation.
Brands in B2B markets are useful in that they contribute to the reduction of perceived risk and
uncertainty in buying situations. An organization can attain legitimacy, status and recognition
by buying branded products and by being associated with a renowned organization.
There is vast literature supporting the idea that companies should be operationally aligned
when functioning in partnerships, but there is not much literature alluding to the need for an
alignment between the internal views that are held within the organization and those of its
supplier base. In effect and in the context of industries that are characterized by large
transactions between companies and their suppliers, the building of relationships that go well
beyond those individual transactions, no matter how valuable they may be, are key to the
success of both parties.
Thus, trust and commitment in relationship building play a central role in the success of
partnerships as it ensures that suppliers cater to the specific requirements of the organization
offering goods and services that are aligned with the objectives of the company to whom they
are supplying. The buying organization in turn, and being satisfied in its needs reciprocates by
repeatedly purchasing from the supplier in question. Trust is then built on reciprocity of
behaviour and leads to mutual commitment to interpersonal and inter-organizational
relationship building. This is in sharp contrast with a transaction-based approach to buyerseller relationships that treats every transaction on its own sole merits, instead of looking into
the long-term potential of inter-organizational relationship building.
In the light of this, what is argued is that successful companies choose strategic partners
whose brand personality is similar to their own personality. Thus, in maintaining a consistent
and coherent image before their customer base, organizations will err on the choice of
suppliers, whose persona reflect their own image, as this idea of alignment is a manifestation
of affinity and can potentially strengthen both brands, reducing the potential for conflict.
However, it may just be that some partners seek vendors with different personalities in that
the combination of different supplier personalities may contribute to the acquisition of a
widespread set of skills, competencies and experiences.
Reputation Measurement Methods
Many reputation measures have been criticized for being strongly focused on financial
performance and on the point of view of external stakeholders. The present study aims to
assess corporate reputation from the viewpoint of different stakeholder constituencies. In so
doing, there results a need to reconcile both identity and image and its simultaneous
measurement. This is done by recourse to a generic scale that may be aptly used for different
stakeholder groups. Whilst there are a number of measurement tools available in the
literature, a myriad of measures, reputation still seems to be a complex phenomenon, which
begs the question of the viability of establishing a standard, an inter-contextual measure, and
whether this would indeed be a wise move. Although there does not appear to be widespread
consensus on how to measure corporate reputation, there is, on the other hand, a widely
accepted view that reputation and its management in a strategic and pro-active manner is a
key concept in the lives of organizations today. In effect, as markets mature and as the
competitive environment becomes much more intense, organizations see their commercial
success depending less and less strictly on the products and services that they are able to bring
to market, with other criteria, including corporate culture and citizenship assuming higher
levels of importance. In acknowledging that, it becomes evident that organizational success in
the 21st century revolves around the idea of what the company is about, what it is, rather than
what it does. In other words, what the company is, how it presents and projects itself, all of
these are defined by the corporate brand personality.
There are many methods for measuring the reputation of a company, but most are still
centered around the perspective of external stakeholder constituencies, and mostly reflective
of the views held by one stakeholder group in particular, and a key constituency at that.
Customers are a key constituency for modern organizations they are by no means the one and
only stakeholder group. The literature has however tended to emphasize external perceptions
and in particular the views held of a company by its customers as synonymous with corporate
image.
A profound understanding of corporate image and the monitoring of the views held by
external stakeholders of an organization have indeed become key drivers of commercial
success for companies, as the acknowledgement of the existence of gaps between the internal
and external views allows for the necessary adaptations to be made within the organization,
leading to the alignment of the views of internal stakeholders with the views of its external
publics. This is then reflected in the brand package that is being offered and the cues and
associations that it carries.
This also allows for more effective differentiation strategies to be devised on a spectrum of
possibilities, from the more tangible to the more esoteric, from product attributes and benefits
to people and the nurturing of relationships, with a constant concern for the projection of the
uniqueness of a corporate culture that is then reflected downstream in singular corporate
brand values of exceptional accounting goodwill.
There are again several methodologies for measuring corporate reputation, ranging from those
that do not allow for comparisons to be made between organizations, to those that insist on
such comparisons, and last but not the least those whose focus is on the financial performance
of companies. Other measurement mechanisms exist that are based on the incorporation of
emotional traits into the measurement of corporate reputation, including such criteria as
respect or trust in assessing how the public sees a company beyond its financial performance.
This is typical of the assessment models that have been adopted in Asia or in the UK and that
translate into more or less sophisticated ranking systems, including those of the most admired
companies and others.
Many authors have explored the relationship between the internal and external dimensions of
corporate reputation. The existent literature tends to focus on either the internal or the external
views of organizations and their measurement, but very seldom are both perspectives looked
at simultaneously and in particular when the same metrics are used. There is therefore a
perceived gap, whose closure would translate into the development of a valid scale for the
purposes of simultaneously measuring corporate image and identity.
There is widespread use of scales across a variety of situational contexts and a spectrum of
sectors of economic activity, but some scales may be more relevant in a particular context,
whilst others are more susceptible of use in other organizational contexts. Only a universal
scale however allows for comparisons to be established, for example on the reputation of
companies from distinct sectors of economic activity.
Davies et al., (2004) present a model for the purposes of measuring reputation, which is
validated on a scale that allows for the assessment of both internal and external perspectives
simultaneously. In so doing the authors have decided to adopt what they designate as the
personification metaphor in the pursuit of a metric of corporate reputation. The
personification metaphor is used with the ultimate aim of making accessible what is complex.
The character of a company is according to this model, evaluated as if it were a person.
Corporate character is defined by the authors as the way in which stakeholders characterize an
organization using human characteristics. This approach creates a measurement tool that can
be applied to employees and customers alike, and that focusses on emotional factors as they
are perceived by both internal and external stakeholders in an organization. Punters are
confronted with the following question: "If company X was a person and not a company, how
would I characterize it?” The personification metaphor has also been addressed by other
authors who have added other elements to this methodology by suggesting other dimensions
of corporate character including corporate integrity, innovation, social responsibility, trust,
credibility and others. The personification metaphor has been a popular method in the analysis
of a company’s internal reputation and there are authors who advise on the need for auditing
corporate personality at all times in order to understand what the dominant mind set is at a
particular point in time, as well as what aspects or traits of the corporate character tend to
dominate in certain business contexts and organizational situations, allowing for a company to
identify when and where changes need to be made with respect to such issues as how people
work and the way in which they behave within the organization.
A company that wishes to succeed in the 21st century must endeavour to carefully manage its
corporate persona and express it appropriately in a well-manicured and thoroughly worked on
brand personality. This in turn needs to be as accurate a picture as is possible of the
organization's corporate values and a reflection of these as they evolve. The traits and
characteristics of the corporate personality as seen by consumers and the general public must
be aligned with the internal values of the organization. Only after the firm has been able to
consolidate a set of personality features in a consistent way with the ultimate aim of seeking a
narrow alignment of the behaviours of internal stakeholders and namely employees with the
external values that are sought from the organization by its external publics, can the company
aspire to be consistently more successful than its competitors.
It is worth noting that the personality of an organization, its corporate character, does not
identify the actions that should be implemented to improve the brand. It only identifies the
areas where these improvements can and should be implemented. However, and taking into
account the outstanding results that are associated with its adequate implementation, Van Riel
et al., (1998) advise this method as very useful for companies.
The clarity of analyses entailed in this method and the interpretation of the results that it
generates also constitute obvious advantages that suggest its use in context. Again, it is worth
bringing home the notion that this model has the advantage of testing differences in
perceptions amongst a wide range of stakeholders groups, whilst also being useful for
benchmarking against stakeholder perceptions in other organizational contexts across a wide
variety of sectors of economic activity.
These results reinforce the role of culture and communication in shaping the image and
identity of an organization. It is suggested, therefore, that some initiatives need to be taken for
the monitoring of workforce satisfaction, including boosting internal communications so as to
enable for a better assimilation of corporate mission and objectives and staff training
measures that are conducive to their retention, as well a permanent search for factors that lead
to employee satisfaction and motivation.
It is therefore key that an emphasis is put on B2B contexts, as employees have an enhanced
role as brand ambassadors among business customers, which again calls attention to the
critical importance of strengthening the internal culture of the organization so as to ensure that
the right message gets passed in the context of inter-organizational relationship dynamics.
With respect to the perceptions of external stakeholder groups, it’s critical the importance of
sustaining a collaborative culture with its partners as after all, service quality positively
affects such behaviours as loyalty.
Any developments in the external environment can affect organizational reputation and
performance, which in turn has an impact on the behaviour of the workforce. It is this idea of
a dynamic harmony that requires permanent attention from top management in monitoring
relevant gaps in the pursuit of a balance between both internal and external perspectives that
needs to be emphasized as it equates with the granting of competitive advantage and the
strengthening of the position of the organization. In understanding what external stakeholders
want from the organization and in working internally to ensure that an alignment exists
between internal and external views of the company, top management ensures that external
stakeholder aspirations are internally understood and fully met in a harmonious way.
Reputation management is thus shown to provide clear benefits to organizations. Building a
positive reputation requires substantial time, effort and commitment and any visible pay-offs
may be delayed well into the future. A positive corporate reputation also equates with value
creation for the organization expressed in accounting goodwill in corporate balance sheets. It
is also crucial that the organization communicates well with its stakeholder constituencies,
both internally and externally, and that it does genuinely celebrate positive examples that lead
to the enhancement of its reputation next to key stakeholder groups.
Roper and Davies (2010) alluded to the questionable appropriateness of the use of branding
and its conceptual base in the context of B2B markets, as a B2B brand will never be as
glamorous as her B2C cousin. The latter will necessarily be more dynamic and more
susceptible of communication of its underlying subliminal values to a key organizational
constituency, that of consumers.
However it does not have to be that way, as a corporate brand operating in a B2B
environment may also benefit from being perceived as having its own personality and identity
as well as a clearly defined brand image. Customers perceive large corporations with solid
track records as credible and reliable and corporate culture is in the context of these types of
organizations perceived to be a key contributor to the long-term success of a corporate brand.
Corporate brands can have different meanings and can be trusted in different ways by
different groups in different times and in different places.
Conclusions
In order to achieve success in different geographies and political jurisdictions, organizations
need to build relationships with government agencies, communities and other organizations as
well as building bridges with current and potential business partners, among others, to ensure
that heterogeneous interests are aligned, even and perhaps especially when the macroenvironment is volatile and circumstances change rapidly.
In business to business markets (B2B) relationships are shaped by strategic partnerships
between companies and between companies and a range of stakeholders, including suppliers,
customers or research centres. A wrong decision when it comes to choosing a business partner
may harm the business performance of both of them, or even jeopardize their very survival.
By looking into the track record of the different players engaged in partnership agreements, it
is relatively easy to scrutinize their past performance on such critical variables as reliability
and dependency, and take these as proxies for the forecasting of future behaviour and the
inference as to the likelihood of future action. Within this symbiotic model, marked by the
interaction of different experiences, impressions, beliefs and knowledge, as well as through
the tacit recognition of a much needed multiple perspective that acknowledges and values the
views of different stakeholder groups that lie within or surround an organization resides the
concept of reputation.
The non-fulfillment of a promise is an example of something apparently menial that may
potentially turn out to have serious immediate and long-term detrimental consequences for the
life of an organization, with negative impacts on its reputation, consequences whose
ramifications often extend well beyond the remit of the organization and its sphere of
economic intervention, to extend to the beliefs and actions of third parties that are indirectly
privy to these incidents and develop negative biases towards the organization as a result of
that.
In organizational settings, reputational goodwill is a key asset, and this is particularly evident
in such critical circumstances as contractual and labour negotiations, whereby a good
corporate or product name is much more likely to cut some ice with international
constituencies than any other international diplomacy initiative. It is in any event impossible
to allude to reputation without mentioning relationships and relationship-building.
Academic implications
Relationship marketing has evolved over the last couple of decades into a new paradigm
within the marketing discipline, one where trust and reciprocity play a key role in the
development and maintenance of commercial relationships. Thus, although the literature does
focus less on B2B than B2C markets, the reliance on the belief that industrial buyers are not
affected by emotional factors appears to be by sheer evidence inaccurate, in the light of recent
research which highlights the need for organizations to generate trust and cognitive and
affective links with their stakeholders.
Issues for further discussion
1. Corporate identity has been a significant contributor to the corporate brand concept.
The two concepts are related and often used interchangeably, but there are important
differences.
2. Summarize the differences between the two concepts.
3. What is the role of the Corporate Brand in the Brand Portfolio?
4. Nowadays consumers and customers are highly aware and make informed choices.
Additionally, a brand experience is the result of the consumer’s real time experience,
his perception of the brand, his past and present experience or knowledge and his
perception of the organizational value and reputation. Regarding this, how can an
organization work on its corporate brand in order to build a solid customer loyalty and
sustain its market leadership position in the long term?
5. What is the role of Communication (e.g. internal and external, formal and informal,
etc.) in ensuring brand consistency?
Case Study
Title: Corporate brand from business to business perspective: A case for Brisa Innovation
and Technology (BIT)
Brisa Innovation and Technology (BIT), is a Portuguese company that operates in a B2B
environment and it’s based on an open innovation model in which it assumes the role of
orchestrator in the development of new products. This is achieved by means of an inclusive
virtual factory model, whereby various stakeholders are involved, including universities,
technology centres, start-ups and suppliers.
The creation of innovation ecosystems arising from this particular type of process makes this
model particularly suitable to Brisa, in that it allows for the coverage and development of a
broad range of skills, with a reasonably low outlay of scarce and expensive resources.
The existence of a model of this nature and with these characteristics allows Brisa to assume
the role of a catalyst for innovation, thus contributing to the country’s welfare in the way of
imports substitution. It does so by stimulating the production of knowledge in domestic
sectors of industry and enhancing the organization´s role in the development of an
information systems sector in Portugal.
Whilst allowing for better cost control, the risk of having part of the knowledge base
disseminated throughout the network as expected under this model is something that needs to
be carefully scrutinized as to its consequences and ramifications. The risk however, should be
minimized in the light of the establishment of solid relationships between the organization
and its partners, and that needs to be anchored on mutual trust.
Brisa acknowledges that a strong public image of a truly innovative organization can be an
important asset in what concerns the establishment of partnerships with key stakeholder
constituencies.
The open innovation model, with which BIT operates, is based on a set of multiple
interactions with different stakeholders, both internal and external. In order for this model to
perform well there is a presupposition that the organization as a whole is capable of
developing and maintaining efficient and effective relationships with its key stakeholder
constituencies and namely its business partners. In pursuing this, it stands to reason that it is
crucial for the organization to be aware of its reputation next to key stakeholders in the
markets where it operates. In so doing, the organization is thus capable of implementing much
necessary corrective action or to propose internal solutions that lead to the improvement of its
performance.
A study on BIT’s reputation was made, applying the Corporate Personality Scale developed
by Davies et al. (2001). Since BIT operates in a B2B environment, this scale had to be
adapted to reflect this substantially different reality. A new dimension – Commitment – was
created, incorporating key elements in the building of B2B relationships such as credibility,
experience and ability to innovate. This new scale has been tested and has shown that have
statistical consistency and reliability to be incorporated in a corporate personality scale to be
used in the specific context of B2B organizational setting.
The results of the study have shown that there is a general alignment between the evaluation
of partners and employees, regarding each dimension of the adapted corporate personality
scale (Agreeableness, Enterprise, Competence, Ruthlessness and Commitment), and that there
are no significant gaps identified in the comparative perceptions of employees and partners
regarding BIT’s activity.
Although upon analyses of the dimensions of corporate reputation no significant
discrepancies were found between internal and external stakeholder perceptions, an attempt
was made to understand stakeholder views as to what was meant by respondents with respect
to each item of the scale that was rated. It was found that there are statistically significant
gaps (between items “friendly and arrogant”). Should this not be corrected, it could eventually
lead to imbalances in the organization´s reputation.
In addition to this, a key finding needs to be mentioned and that is the fact that the corporate
dimension that was rated worst of all, ruthlessness, is perceived more negatively by the
internal stakeholder group (although not yet with negative absolute scores) than by external
stakeholders, reflecting a low satisfaction level on the part of employees with the
organization.
Case Study Questions
1. What is the role of culture and communication in shaping the image and identity of an
organization? Elaborate on initiatives that need to be taken for the purposes of
monitoring workforce satisfaction.
2. Discuss the application of the corporate personality scale, originally developed in a
B2C context in B2B situations. What are the issues that one needs to worry about
when applying this scale in a B2B context? What are the significant differences
between the two contexts with regards to the application of the scale?
3. Elaborate on the notion of stakeholder management and the need to reconcile the
views of multiple stakeholders in a balanced and harmonious way. Discuss this in the
light of the need for stakeholder alignment, and in particular the alignment of the
internal views of employees with the external perspectives of customers and what they
expect from the organization.
4. Discuss the relationship between reputation management and corporate branding.
What are the relevant links between the two concepts? How do they interact and in
what ways are they interdependent?
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