Malcolm Allan
Locum Consulting
mallan@locumconsulting.com

Microsoft Word version

Abstract
The author, a town planner and place and destination brand practitioner, discusses the challenges of creating place brand strategies for completely new types of urban development using the example of the emergence of places that combine retail, leisure, entertainment, sports, cultural and heritage facilities to a greater extent than has been seen hitherto.

Cities are changing and their places are changing
Cities have been in a constant state of change and evolution ever since they were first created and change is nothing new in the urban landscape. What is new, especially in western Europe and North America, is the emergence of new kinds of places that contain and combine land uses that even five years ago would normally have been separated and kept apart by urban planning policy and planners’ desire for the neat separation of activity generators. Examples of these more complex and multi-functional developments are to be found in large metropolitan cores such as the Kings Cross St Pancras area of London where the developer, Argent, is creating what will amount to a completely new town in the heart of the inner-city area, a place that will bring an entirely new offer of services and experiences for the people who work there, live there, visit there or just pass through the rail termini—a combination of offices, shops, housing, learning institutions, cultural institutions, tourist attractions, and an extensive public realm for events and gatherings. It will change the character of the area and its identity and a major challenge currently facing the developer of this area, and others like it, is how to position it, how to explain it and how to describe it—in short—how to brand it.
   Elsewhere in the metropolitan cores, developers are inventing and creating new kinds of place of a similar scale, offering completely new kinds of offer and new combinations of offer to consumers. A good example of this is the development by Uplace, a Belgian development company, who are creating what I would describe as an ‘experience retail’ centre on the northern edge of the city’s inner city core, a retail-led place of entertainment, culture and learning, on a scale that has never been created before in western Europe. They, too, are facing the challenge of how to brand this new type of place, of how to describe its offer of value to the many different types of consumer who will live, work, shop, be entertained or visit the area.
   Why is this happening? Developers like Uplace and Argent do not take risks with their developments; they do not build places that people do not want to spend time and money in. They build places that consumers wish to spend time in, to congregate in and to experience. They are acutely aware of changes in consumer trends, particularly in retailing, culture, leisure and recreation. They are aware that, despite the short term hiccup of the western “credit crunch”, consumer needs, wants and aspirations are changing and that, especially for the urban consumer, they are increasingly wanting those to be satisfied in places that offer them a greater variety of offers, a greater variety of experiences and a greater concentration of offers and experiences—all in one place if possible.

Consumer needs, wants and aspirations are changing
Nowhere is this more pronounced than in the latest developments to be seen in the design of what we have traditionally thought of as retail environments—shopping centres—where the shops may no longer be the real magnet or draw attracting consumers, where it is the combination of leisure and entertainment uses that are the real draw.
   Shops used to be found on high streets. Then, after the Second World War, following influences from development in the United States and the impact of the growth of private car ownership, they could also be found in large boxes in out-of-town locations and at motorway junctions. Then they were increasingly found in airports and at railway termini and at the more sophisticated forms of waterfront development. In a few places the developers added in a cinema or two, or a multiplex, possibly also a bowling alley and, more recently, an indoor adventure sports centre. The more adventurous of these offered indoor skiing, or water-sports, or mountain-style, rock-climbing faces and rope walkways. Along the way, shopping moved from being something of a necessity to something of a pleasure, to being a form of entertainment, for some almost a pastime. Gradually, over time, but now with greater rapidity, we are seeing the emergence of a new kind of place, a new kind of experience, a new form of destination—the ‘experience retail development’.
   The challenge for developers is how to position, describe and brand these places. This article explores this challenge in more detail through two case studies on the development of brand strategies for these new kinds of place.

What is experience retail?
Experience retail is not just a loose combination of shops in a big box with a few leisure add-ons, such as a multiplex cinema and a bowling alley—now pretty standard and boring fare for many out-of-town big box retail developments. Experience retail is a much more sophisticated offer to consumers of a place where they can satisfy many of their needs, wants and aspirations for the products, services and experiences that they require for their lifestyle and self-image. Experience retail combines very innovative forms of delivering the retail experience together with the leisure entertainment and cultural experiences that consumers want or aspire to, and, increasingly, the residential lifestyle they aspire to as well. In the delivery of service in the retail environment, experience retail provides a more personal and higher quality service. Staff really do know about the products they are selling (often modelling the clothes themselves), who designed them, and where they are made. They are backed up by the latest technologies, like the dressing cubicles with built-in, time-delayed cameras which can show you how the dress or the suit looks from behind.
   Experience retail is a new form of retail place—a destination—where the main driver or attractor is a retail component supported by a combination of activity attractors designed to drive sustained foot-fall to it. It’s a form of development where the overall experience on offer for consumers is a place to spend time and money on a mix of experiences. The mix can include retail, leisure, entertainment, cultural, heritage and sports attractions. It may include a casino–hotel combined with a theatre or concert hall, cultural or sports attractor, such as a museum or a stadium, and perhaps a commercial office element. It can also be a place where people may wish to stay over to experience the full menu of attractors, facilities, events and programmes.
   The drive towards experience retail is being fuelled by changes in consumer behaviour, especially in the advanced consumer societies of western Europe, North America, southeast Asia, Japan and Australasia. Research by myself and others is showing that increasing numbers of consumers now regard shopping as a form of leisure and entertainment and are looking to spend more time in places which offer them a mix of experiences, including shopping, leisure, entertainment, sports, cultural facilities and even access to heritage attractions, in one centre or place.
   Uplace, in a recent publication, summarize the research they have conducted on changes taking place in consumer behaviour and how consumers now wish to satisfy their needs, wants and aspirations in new kinds of places. What they found is that consumers want to accomplish more in less time. Shopping is evolving into an experience. Retail is becoming part of the entertainment industry and shopping is now a way for people to express themselves and associates people with desired lifestyles. Aspirational brands are becoming more important, well-designed buildings are becoming a more important retail marketing channel and the physical retail experience needs to be both entertaining and authentic.
Social trends research in the USA and the UK also indicate that consumers increasingly need to manage many options for themselves and their children in increasingly busy and complex lives. They face the paradox of increasing time pressures and expanding choices. They are increasingly looking for multiple experience settings, shopping that’s more like entertainment, and places to hang out with friends and family.

The evolution of the experience retail phenomenon
For consumers with money, and even those on temporarily reduced budgets, shopping is becoming more “fun” than “run”. Consumers increasingly desire experiential pleasure and feel-good sensations from consumption and are spending more money on quality experiences than on material goods. To address this trend, product manufacturers have recognized that they need to offer consumers experiential sales’ environments, such as the new Apple Stores in major and capital cities around the world or the Abercrombie & Fitch stores in New York and in London.
   The Abercrombie & Fitch store in Greenwich Village looks and feels like an old-style select gentlemen’s club where their clothing fits in like a glove. Consumers can now distinguish such environments and offers in terms of the differentiation (quality, fun, level of service) of the experience they offer. In London, the new A&F store feels almost like a nightclub where fashion-conscious young people and models now hang out wearing the clothes from the store, and where the actual displays seem almost incidental to their display on the bodies of those who “inhabit” the store. It’s a place to be seen in and one where the A&F cognoscenti feel at home. By contrast, the lure of the Apple store in London’s Regent Street is that it is a place where it’s cool to be an informed “geek”, to be savvy about the cool technology, to be comfortable playing with it, to learn about its capabilities from equally or more savvy people of your age (if you are under 35), and to decide what to buy and have it shipped to your home within days.
   As unlikely as it seems, these stores have a predecessor in the form of the Disney Stores which, although designed to shift product in large volumes, are also designed to give the customer a foretaste or remembrance of the Disney experience, whether it be to see one of their movies or to visit one of the Disneyland theme parks. Buying your Goofy puppet in store and taking it home extends the pleasure of that experience.
   The implications of this are that retail development must offer consumers, who are becoming ever more younger, an authentic and entertaining environment in which to find, try on, buy, wear and display goods alongside a complementary and relevant mix of attractors and lifestyle experiences, if they are to be attracted to spend their time and money there. Evidence from the United States indicates that such places are also offering a public realm “in-store” or in the mall that acts as a setting for new forms of public art and sculpture and as a stage for people to show off what they have bought and for them to listen to or participate in live music, drama and dance events.
   The implications for developers are that shopping centres will need to include leisure and entertainment and sports offers and that shopping centres will be more like integrated, urban entertainment centres with high-quality, well-managed, and active public realm.

Where can you find evidence of experience retail?
In the UK, combinations of retail and indoor sports and leisure and entertainment facilities can now be seen. Located In Milton Keynes, the first Xscape, indoor, snow sports facility, offers an all-year round snowslope, rock climbing, Airkix (which simulates freefall skydiving), health and fitness facilities, bowling, and a cinema. In the Trafford Centre in Manchester there is an indoor, state-of-the-art soccer dome which provides facilities for small-side soccer teams to play and practise, plus a 20-screen multiplex cinema and a comprehensive upmarket food-court.
   In central Europe, some examples of retail developments that are moving towards the experience retail concept are Rivetoile commercial centre in Strasbourg, the Ballymore riverside, mixed-use retail centre in Bratislava in Slovakia and the new retail centre in Duisburg in Germany.
In the Middle East, good examples of experience retail can be seen in Dubai. For example, the Sahara Centre complements an international array of global retail brands with a food centre offering local and global cuisines plus an Adventureland family entertainment centre offering 20 rides, an indoor roller-coaster, a multi-level train, an indoor water flume, a billiard hall and a mini-bowling alley.
   Dubai is also the site of the Middle East’s first major comprehensive experience retail development, the Sunny Mountain Ski Dome, due for completion at the end of 2008. The project consists of a dome that will house a large revolving ski slope, going through and around an artificial mountain range created to emphasize an “Arctic experience” effect. Within the dome, there will be a range of Arctic experiences including a Penguinarium, winter aquarium, snow castle, ice-rink, Arctic animal statues, four-season aquarium, snowfall, sound and light effects, cold and warm bath spa, an ice-bridge, a cable-lift, snow maze, ice-slide, and polar bears. All of these will be complemented by a deluxe hotel, a shopping mall, restaurants, coffee shops and other retail outlets.
   Dubai also hosts an annual shopping festival in January of each year which serves to showcase the complete visitor experience of the city—Ski Dubai, the Zoo, the Dragon Mart, Dubai Creek, the Dubai Museum and camel racing. There are other events as well, including international fashion shows, children’s events, street performances, nightly fireworks, film festivals, and many other cultural events that reflect the Emirate’s cosmopolitan character. In addition, one of the biggest events of them all, the Dubai World Cup takes place during the festival, with a US$12 million purse that makes it the richest horse race in the world.
   In the USA, the developer Rick Caruso, who heads up Americana at Brand, based in California, is a pathfinder showing how to meet changing consumer demands. Caruso has significantly changed the face and form of US retailing by creating what Mathew Garrahan of the FT describes as ‘vibrant open air retailing centres instead of bland indoor shopping malls’.
A very good example is his development in Glendale in California, which offers a mix of retail, leisure, entertainment, food and beverage facilities and a high-quality residential component, with condominiums and apartments to rent or buy. This is a place to live, to meet, to hang out and be associated with for the local population who are tired of big boxes with no sense of place or personality.
   This development is the opposite of so many impersonal retail malls across America which are now feeling the full force of the effects of the sub-prime mortgage fiasco and the credit crunch. Many of these malls, almost wholly retail in their floor space, are rapidly emptying or facing complete closure. As they shut, their local communities are losing their main meeting places, especially where the malls had previously replaced the old main street. In an article in the Observer newspaper, James Doran observed that many malls, once the centre of life in American town and cities, are falling dark and local populations are feeling their communities have lost their sense of place and focus. How different this might have been if, instead of being predominantly retail, they had offered leisure, recreation, entertainment and sports facilities, as envisaged in our concept of experience retail.
   Examples of such developments can be found across America and they do appear to be weathering the economic storm in far better shape. They include the Shadow Lake Town Center which serves the Kansas City and metropolitan Omaha metro region, the Shoppes at Chino Hills in California, Solair in Los Angeles’s Koreatown and Culver Studios Plaza in Culver City in California. Important characteristics which unite these and many other similar developments are the return to the street as the predominant built form, the increasing space being allocated to non-retail lifestyle facilities and services, and the high-quality public realm with its use as a venue for meeting others, hanging out, events and entertainment. They are being deliberately designed as places with a human scale. People can spend lots of time and money there on a mix of activities that help them define who they are as consumers and satisfy their aspirations.

The challenge of branding experience retail places
Given this trend towards the development of larger scale, complex, mixed use developments, some at the size of small towns—completely new communities—how do their creators develop relevant and effective brand strategies to ensure that consumers become aware of, understand, differentiate and decide to experience the services and facilities on offer in them?

‘The Creative Place’
I have been working with two firms of developers to assist them with exactly these challenges. In London, I have been working for developer Hutchison Whampoa UK (whose parent company owns and operates international docks in places like Hong Kong) on the development of a new experience retail concept—‘The Creative Place’—to sit at the heart of a new, predominantly residential, development of twenty-five hectares at Convoys Wharf in Deptford in London’s docklands, a site which sits on the southern bank of the river Thames opposite the bottom of the Greenwich peninsula. Deptford is one of the poorest areas in inner London and an area that plays host to waves of immigrants to the city, most recently Somalis driven from their country by recent wars and disruption. Despite looking and feeling like a very run-down area, it is actually very vibrant and cosmopolitan and has a number of creative facilities, some with world-class reputations, such as Goldsmiths College and the Laban Centre for Contemporary Dance.

Figure 1
Convoys Wharf, the Creative Place

At the centre of the site stands a large protected building, the Olympia, whose structure was designed and built from wrought iron tracery of a similar kind that Gustav Eiffel designed and used for his tower in Paris. The challenge presented to me and my colleagues was to come up with a proposal for the reuse of this large building in a way that would differentiate the residential apartments to be built around it, provide an improvement in local retail, leisure and recreation facilities, and “locate” the development as a distinctive place with a distinctive offer in south east London.
   Using a facilitated workshop format we met with the developer and their real estate advisers and to develop a vision for the building and the site, to identify alternative concepts for realizing the vision and to develop a brand strategy to guide the development and use of the Olympia building.
This creative facility is designed to attract people to live in the development and be a place for residents to entertain friends and relatives, and for people who live in its catchment area to visit, as well as adding to the retail and leisure offer and experience of the area. Locum is proposing a mix of creative retail facilities and activities, including bespoke fashion designers’ shops and workshops, workshops and showrooms for designers of fabrics, restaurants, cooking schools, specialist bookshops and spaces for performance arts—drama, dance, live music and theatre.
   In Eire, Locum has been working for a developer to create the concept of Europe’s first “retail resort”. Located midway between Dublin and Belfast, this will be known as ‘The Perfect Place’, a place in which to stay and relax in a top-class spa hotel, while shopping in a retail facility that will be home to the world’s top designer fashion, jewellery, shoe, accessory, furniture and interiors and automobile brands, eating at one of a number of world-class, chef restaurants or making use of a great range of indoor and outdoor sports facilities, including watersports, sailing, golf, hill-walking, equestrian facilities and Ireland’s first all-weather race track.

Figure 2
Dundalk, the Perfect Place

Some conclusions
In conclusion, we believe that experience retail will be a major form of development over the coming decade. It has the capability to revive many flagging town and city centres and return them to being places in which people will want to spend time and money. Experience retail developments will change the offer of the places in which they are located, change the nature of the experience offered to consumers and change their branding as destinations.

Locum’s services
In response to these changing consumer trends we have created the team to enable developers to realize this new form of destination. The Experience Retail Team offers an integrated service and works with its clients from the point of developing their vision and concepts for the development to its sale or its ongoing management. The team provides integrated services combining destination brand strategy, destination specification, development appraisal and risk assessment, planning, valuation, investment, licensed and leisure, attractor and tenant identification, hotel development, letting strategy, asset management, marketing strategy and communications, and overall project management.

Tony Quinlan
Narrate Consulting
tony@narrate.co.uk

Microsoft Word version

Leadership. Three syllables—nice, straightforward concept. Right? Wrong. What I perceive as a good leader will be different to what you perceive as a good leader. And different again for the person sitting across from you, down the hall, in the next building, in the regional office, etc.

But in recent years, many of us have found ourselves getting involved with communicating around ‘leadership’. It’s an area fraught with difficulties and pitfalls—in part because of the simplistic way it gets talked about. With that in mind, this is a short thought-provoker piece, with some tools to start you off.

Myth-perception
Let’s get some of the misperceptions out of the way first.

‘We all know what a leader looks like.’
Possibly, but we all have very different ideas about it, and it changes anyway depending on the situation—in a storm, a leader might impose control, dictate actions and cut through waf?e and discussion. The same behaviour in calmer moments betrays a dictator, not a leader.

It also varies tremendously by organizational culture. Hard, argumentative styles work in some organizations, while others need softer, more consensual approaches.¹

And often there is no common factor or principle—other than the fact that people follow (or obey, depending on the style). There are reams of research and popular books on leadership—and all have different takes to greater or lesser degrees. Some of the leaders depicted in them wouldn’t recognize each other in an empty room.

‘Here’s our leadership model.’
Less a misperception, more a warning bell. In my experience it’s either one flavour (generally male, English-speaking, western, rational, white and aged 40–50) or, on those rare occasions when the idea of diverse leadership styles have been taken into account, it’s been made so abstract that it encompasses all the different styles and hence is so generic it loses its relevance.

Most leadership models are useful as starting points for debate or as the output for individuals’ thinking—but as communications tools they stink.²

Too often, the result—after much careful thought—is a list of principles or values. It’s flawed for two reasons. First, these tend to be abstract ideas (usually nouns) where leadership is about actions (verbs). Simply holding those principles to be important isn’t enough, leaders need to act on them.

Secondly, it’s impossible to force people to take on certain values and act from them. Even persuading them is only a temporary measure. Values and principles are personal choices—voluntarily taken on. And bear in mind that, even when we wholeheartedly hold a value to be important, as human beings we don’t always act accordingly.

‘We want everyone in the organization to be a leader.’
No you don’t. There are a fair number of people that you want to do their job as set out in the quality processes and do it without arguing. You don’t want them to be leaders, you want them to be efficient and obedient. (Loyal, enthusiastic, etc would also be good, but efficient and obedient are actually the ones many managers want first and foremost.)

And just because someone exemplifies the organizational values or behaviours doesn’t make them a leader—they may just be following what they perceive as authority. Exemplars are not necessarily leaders, but leaders are always exemplars.

You want some of your people to be leaders, but talking about its applying universally just devalues it.

Please note, I’m all in favour of us all being leaders at the personal level—in fact I think that’s one of the ways we best fulfil ourselves as individuals and change the world we live in. One of my most profound learning experiences was on a course in Leadership back in 2000. But personal leadership and organizational leadership are different things.

If, within the organization, people are adamant that they do want everyone to be leaders, then too often it’s either just devalued lip service alongside “our people are our greatest assets” or their idea of a leader is not ambitious enough, but the classic ‘manager-plus’.³

Leadership and culture
Leadership is defined in many different ways. For a subject to which so many dead trees have been devoted, there’s still a phenomenal diversity of opinion on what it actually entails. It’s less helpful for communications, change and organizational development professionals to be too specific—with one important exception.

Leaders and culture are strongly intertwined and critical to our work. Culture expert Edgar Schein talks about leaders being one of the three major levers of organizational culture. (If they’re a founder, that makes them two of the three, but that’s an organization-specific situation.)

Yet leaders are also shaped or rejected by organizational cultures. Outsiders can find that they miss major assumptions and ultimately fail, while insiders may be so inculcated in a mindset that they are unable to grasp the need—or perceive the leverage points—for successful culture change.

Which still leaves the fact that leaders are one of the most powerful influences of organizational culture—making them crucial to us.

Why leadership is not Manager-plus
One of the most useful and powerful tools in Narrate’s work is the Cynefin framework, created by Dave Snowden, and the concepts behind it. It’s applicable in many different areas, but helps to distinguish key areas within the organization and the recommended approaches to them.

Figure 1
The Cynefin framework

In a vastly simplified description, culture falls into the Complex domain—where causality is blurred, where many different elements combine to create overall effects and where results will never repeat exactly. In this domain, control is impossible, inluence essential. It also requires different actions—trying elements, waiting to perceive the results and then acting to reinforce the emerging patterns or disrupt them if they are negative. It can be about creating boundaries and attractors, by reinforcing desirable behaviours and disrupting undesirable ones.

By contrast, the Complicated domain does have repeatable cause-and-effect chains, although these may be extended through various stages. Here, we can analyse or get expert help to identify how results are created and impose processes to repeat them. This is the realm of big thinkers, strategic planning departments and theoreticians.

Given the vagaries of human behaviour and belief, I believe organizational culture sits squarely in the Complex domain. I suggest therefore that management—based in process, measurement and hierarchy—is more inclined to sit in the Complicated domain.

Managers aim for efficiency—focusing on process. Leaders aim for effectiveness—focusing on results and people.

Collaborating on “leadership” programmes
Recent years have seen an increase of programmes rolled out from Human Resources or training and development departments aimed at increasing leadership skills within the organization.

One of the critical elements Narrate recently worked on in a large government department was establishing common ground between different ideas of “leadership”. In a questionnaire (after the “leadership model” had been published and promoted as the way forward) one of the critical pieces of feedback was, ‘We need pen pictures of examples of leadership.’ Everyone understood the language but not how it translated into action.

Using a technique from the Cognitive Edge network, Narrate brought key decision-makers together in a facilitated exercise solely to relate and share examples of tough decision-making, positive changes, mistakes made, etc. For participants, it was a powerful social exercise in sense-making—it left them all with a clear, common understanding of what was (and wasn’t) good leadership.

Having recorded the sessions, we then had audio and video material to feed into various communications vehicles—all giving the requested ‘pen pictures’ of leadership in real, authentic examples that people could recognize, internalize and then act on themselves.

Similar exercises at lower levels of an organization and among customers and customer-facing staff produce material that, when replayed to executives, can dramatically shift perceptions and highlight major problems—but in ways that are less threatening to the messenger and more likely to bring about a change in executive mindset.

Organizational legends and heroes
In every culture, certain events and individuals stand out—becoming legendary in their retelling. And each story will reinforce some value within the organization—but not always the one that we think it’s telling.

In particular, organizational narratives coalesce around particular leaders and around times of particular significance—moments of threat and risk, examples of great success or, crucially, the point where the old order changed.

It’s only possible, however, to understand what might be significant by listening and reviewing what stories are already in common usage. New inductees will be told the most crucial stories for their area within the first few weeks of starting—those that indicate how things are really done around here. Recognizing and collecting those stories about past leaders can give you huge insight into what is expected of a leader in your specific organizational culture.

Helping leaders to communicate
A crucial role for many communications professionals is helping a leader to communicate—and thus engage, inspire or transform the workforce. I’ve already talked about different leadership styles, each obviously implies different communications styles to match.⁴ Ergo, not all leaders have to be loud, supercon?dent, alpha-male communicators. Their communications should be natural and fit their personal style.
One factor that identifies good leaders is that they know what they are good at (and do that) and know what they are not good at (and find someone else to do that). Some leaders are simply not communicators. As soon as we become aware of this, it’s critical to find colleagues that the leader trusts to fill this role. In cases where there are varied environments reporting to a single leader, multiple communications styles may well be needed—a tougher style for masculine departments, intellectual for research, etc.

The traditional way of communicating for senior managers has been “problem–analysis–solution–let’s go!” Which rarely convinces, far less inspires or engages. A leader seeking to influencing the organization does so in other, more fuzzy ways, including:

• what they choose to measure and pay attention to;
• how they react to incidents and crises;
• role-modelling, teaching and coaching;
• the rituals and habits they create;
• which metaphors they use in communicating;
• what stories they tell of past events and people;
• what they tolerate;
• formal statements of philosophy, creed and values.

The last item here is the one where, typically, we put the most attention, thought and energy. Yet it’s one of the lesser levers in influencing a culture. If you’re supporting a leader, encourage them first to understand that the culture is better changed by the higher elements.

Role-modelling
A leader should, first and foremost, be role-modelling the behaviours expected elsewhere. The greatest sin of a leader is hypocrisy (not fallibility, as is often assumed) and if (s)he is not visibly trying to exemplify the corporate values, the whole thing is doomed. Stories of hypocrisy circulate faster than any other and have a massive impact on staff morale and management credibility.

Some of the toughest conversations I’ve had with leaders in organizations have, over an hour, moved from the change needed in the organization to the change needed in the staff in the organization. The tough part comes in bringing those comments closer to home.

‘So if that’s the change you need them to make, what change do you need to make?’

‘No, you don’t understand, they need to change, not me.’

‘I understand you want them to change, but they will watch you—if you change, they will. If you don’t, they won’t. So what change are you going to make?’

Handled properly (something I didn’t always do in the early days), these conversations also become some of the most productive and helpful to the change effort.

Personal stories
As communications professionals, we need to support leaders in being more personal, authentic and fallible than they may have been in the past. One of the keys is to talk about personal experiences.

As part of a major change programme in a merging organization, Narrate associates coached and challenged senior board members to talk about their personal experiences in the organization when they presented or appeared at internal conferences and events. They talked about their early days and perceptions, the dif?cult times when reorganizations threatened them and the tough (and on occasion wrong) decisions they’d had to make along the way.

It wasn’t about generating sympathy for them, but building human connections instead—breaking the false image of the imperious, unemotional manager at the top. Crucially, it also gave people context in which to see decisions and behaviours, allowing them to draw lessons from what they heard without having to make them explicit and risk them being rejected as being “command-and-control”.

Helping staff to mind-read
One of the pieces of feedback we regularly hear from front-line staff is that they ‘want the chief executive to be more visible.’ They do, but visibility of the leader is not enough. What they are looking for are ways to be see the leader’s thought processes—through open questions, through examples of tough decisions made, through what they comment on and through what stories they tell.

In a geographically spread organization, this is one of the places that blogs and social media can be very powerful. Some leaders find that blogs are their best communication tools—they may not be expert face-to-face communicators—while others are more natural talking on a podcast.

Regardless of whether a leader feels able to use such communications vehicles, there is one area of thinking that will have a strong effect on the culture and can be communicated relatively simply through standard channels: what the organization will stop doing.

At least as important as what the leader decides must be done is what will not—what projects to finish, what markets to come out of and what activities to stop. Typically these are announcements that we make quietly and with as little fuss and information as possible, fearing that the implicit message is that it was wrong to be doing these things. But by providing enough context on the environment and the decisions involved—both at the beginning and now at the end—it will instead give people more insight into leaders’ thinking and, where appropriate, the confidence that decisions can be revisited in the light of new information.

Battling old heroes and legends
When leaders want to signal a major shift in the organization, it helps to understand what organizational myths are reinforcing the old behaviours. Then, rather than trying to convince or persuade or even tell a counter-story, it’s usually possible to take some authentic action that devalues the stories and begins the process of creating new ones.

I worked at an IBM manufacturing facility in the 1990s, where site directors for years only descended to the manufacturing lines on rare occasions, usually accompanied by a cadre of senior managers, and only spoke to line managers. Until a new site director in 1996 turned up alone at the ThinkPad line on his third day to be met by the line manager—more than a little nervous at this unscheduled visit.
‘Can I help you?’
‘Sure. Have you got a white coat I can borrow?’
‘Uh-huh. Can I help?’
‘Don’t worry—you get back to what you need to do. I’m going to work on the line.’

Which he did for the entire shift. The story was round the two-mile site within the hour—and suddenly people knew that here was a different kind of site director.

It’s essential that these are authentic actions and stem from the individual leader’s own convictions, and that they are not accompanied by photographs or standard internal comms tools—instead they’re done visibly and allowed to circulate around the organization on the informal networks.

In addition to creating new legends in the organization, they need to pick and choose carefully those stories from the past that they retell and emphasize. Frequently reframing a story slightly can demonstrate that values are not new, but have always been part of the culture. However, a leader’s immersion in the culture may make them myopic to what message the story actually conveys.

One United States IT services company encouraged its employees to emulate the Sooners—people who were determined to get the good plots of land when Oklahoma was opened up to settlers. The Sooners, however, stopped at nothing—illegally grabbing land ahead of the official start date. The risk (reality in some cases) was that a general “get the results, regardless of costs or means” attitude spread through the organization.

Immersed within the culture, the story of the Sooners was seen as a powerful motivator and the subtler drawbacks to the message weren’t seen. One role of communicators is to remain sensitive to the nuances of communications and stories and provide valuable feedback to leaders.

Mountain-climbers or battle strategists?
Another subtlety of leadership communication is the language and metaphors they use. Metaphors permeate our language and have strong influencing effects—talk about capturing new customers, winning market share, beating the competition sets up a win-lose, us-against-them mindset, which may or may not be appropriate.

In the early 1990s, PC manufacturer Compaq declared that it intended to be the market leader in PCs worldwide. The language surrounding the subsequent changes in the company were heavily based on military metaphors—staff were ‘troops’; strategies included ‘meeting clones head-on’, ‘capturing imagination’, ‘firing the first salvo in a price war’, ‘pre-emptive cost reduction’ (this was in reality 1,000 employee lay-offs). It worked for Compaq in the short term, but long-term created an environment built on the idea of conflict.

Once the company was market leader (a goal reached in remarkably short time) there was no clear “enemy” for a workforce embedded in the idea that every action was predicated on conflict. One of the results was greater internal con?ict between departments and, ultimately, Compaq’s takeover by Hewlett-Packard.

Equally, some metaphors that come naturally to leaders may actively deter their audiences. Recent examples we’ve seen include describing a change project as like climbing a mountain, complete with guides, base camps, interim peaks as targets. (Overheard at the back of the room was the aside that ‘It’s cold, wet, uphill all the way and what happens when we get to the top? We’ve got to come all the way back down again.’)

Supporting leaders

Leaders can feel lonely and isolated. Recent research has shown that a number can be depressed—too many people looking to them for decisions; being surrounded by colleagues who, depending on the culture, tend to fall into two camps: unchallenging followers or conflicting rivals. There is also a strong risk of becoming so strongly set in one way of seeing the world that warning signs or alternatives viewpoints get screened out.

Depending on our own leadership and influence skills, we may be able to take on the role of adviser and, to a degree, offer challenges to help clarify thinking. If it’s not a role that we can play, respected outside experts can be used. Many leaders have academic colleagues in whom they confide.

One critical element of this is to help leaders to view situations with different perceptions—either by direct action ourselves or by introducing external influences to do it for us. This can be done by introducing direct feedback from other stakeholders like customers, partners or legislators.

Alternatively, there are powerful facilitated exercises, such as the chair game, that create unusual perspectives from which to reflect on personal behaviours and organizational issues. These, often revolving around some form of social sense-making, can be both powerful team-building exercises and valuable perception-shifting tools.

Leadership is also a matter of consistency. Inconsistent behaviour—or tolerating breeches of values in favour of, for instance, high revenue—will undermine months of work in short order. Yet leaders are often so passionate and so driving that they become immune to such things, not doing them deliberately but simply failing to spot them. And, having cultivated an image of a thoughtful, rational approach to issues, a leader will be perceived to have done so deliberately rather than simply made a mistake.

Finding tactful but effective means of pointing out such inconsistencies is an essential role in the organization. Close associates of leaders are unlikely to do so—being either blind to the problems themselves or too concerned about organization politics to risk commenting. If this is the case, a quiet word with a trusted external adviser can bolster their value to the leader while addressing the issue.

Finally a critical factor for any leader is where to draw the line. It’s great to talk about what we aspire to as a way of lifting the culture and people upwards, but one of the things about leadership is also visibly changing what we will no longer tolerate. A great recent example was Mark Thompson, Director-General of the BBC, responding to the recent deceptions in interactive quizzes and phone-ins. Talk about what the BBC aspires to is one thing, but emphasizing that anyone who slips below certain standards will be shown the door is critical—and the same goes for leadership.

Notes
1. An organization, in this context, could be a company, a division, a department or even a team—essentially just a group of people working together. Each may have different cultures.
2. The McKinsey Quarterly recently talked about leadership ‘orienting strategy around an organizational model that nurtures knowledge and talent’. There’s more meaning there than in many similar pronouncements, but it still could have come from the mouth of Dilbert’s manager—a sure warning sign. N.B.: nothing about numbers, measurement or results.
3. ‘Manager-plus’ is the version of leadership that some organizations call for—greater effectiveness (and efficiency) and innovation and customer service, but it implicitly rejects greater risk-taking or dissent. It calls for greater results but still within rigorous processes and quality control. It wants more, but without threatening the status quo or the hierarchy. Not leadership in my book.
4. It also presupposes that leaders want to engage, inspire or transform the workforce—if they don’t then, again, they’re managing, not leading.

References
E. Schein: Organizational Culture and Leadership. San Francisco: Jossey–Bass 2004.
H. Gardner: Changing Minds. Cambridge, Mass: Harvard Business School Press 2006.
C. Kurtz and D. Snowden: ‘The New Dynamics of Strategy: Sense-making in a Complex and Complicated World’, IBM Systems Journal, vol. 42, no. 3, September 2003, www.research.ibm.com/journal/sj/423/kurtz.html, via www.cognitive-edge.com/articlesbydavesnowden.php.
G. Klein: Sources of Power. Cambridge: MIT Press 1999.
D. Rock and J. Schwartz: ‘The Neuroscience of Leadership’, Strategy & Business, no. 43, summer 2006, www.strategy-business.com/media/?le/sb43_06207.
D. Fisher, D. Rooke, and B. Torbert: Personal and Organizational Transformations. Boston: Edge/Work Press 2003.
D. Taylor: The Naked Leader. New York: Bantam 2002.
S. Farber: The Radical Leap. Chicago: Dearborn Trade Publishing 2004.
J. Collins: Good to Great. New York: Random House 2001.
E. Schein: The Corporate Culture Survival Guide. San Francisco: Jossey–Bass 1999.

Appendix
The core Narrate questions for any leader to answer:

1. What will you personally be doing differently?
2. What similar change have you experienced previously? What happened? How did you feel?
3. What tough decisions have you taken as part of this change? Why did you decide what you did?
4. What will the organization stop doing now?
5. What will you personally stop doing?

Jack Yan
Jack Yan & Associates, PO Box 14-368, Wellington 6241, New Zealand
jack.yan@jyanet.com

Executive summary
Detroit has not ever used a brand orientation in its automakers’ marketing strategies, and it talks of trimming brands and numbers to allow it to compete. The author believes in being more focused on brands and not losing economies of scale, and building more of what consumers want. The tools are there, such as consumer-targeted blogs, but manufacturers need to use them.

Introduction
Motown has been in trouble constantly since the 1970s. That time, it was its failure to see how the imports were gradually conquering North American market, and when the Arab-Israeli War forced up fuel prices in 1973, the Japanese were already there with models that had great gas mileage. When the second oil shock happened, US companies were still largely ill equipped. Then-Ford president Lee Iacocca noted that sales of its full-size cars were going up, leaving Detroit’s number two without many economy models.¹ The Japanese won again.

Similar patterns began emerging in the 1990s. Then, Detroit was obsessed with trucks and SUVs. It is generally regarded that there is some financial wisdom behind building these large vehicles, as they generate plenty of profit in an industry where US automakers have massive costs, especially relating to union workers’ pensions and healthcare. But it was becoming obvious to only a few that Detroit was leaving its economy models behind, while the Japanese, once again, were sweeping in with up-to-the-minute variants of their Toyota Corolla and Honda Civic.

The author wrote of this folly at the turn of the century, including DaimlerChrysler’s decision to abandon the low-cost Plymouth marque²—in case low-cost, cheap cars became necessary again. In both these cases, the latest (2008) fuel crisis, driven by high prices and speculation, have proven him right. Detroit is scrambling once again, as it did in the 1970s and early 1980s, wondering how to fix itself. And its ideas smack of repetition—since some of them have been proven to have failed the industry before, in other nations.

The problems are long-term ones that cannot be fixed by short-term adjustments. The truck and SUV obsession was a short-term fix, a quest for profits which Chrysler Corp., in particular, rode very well with its Dodge and Jeep lines in the 1990s. But it left Chrysler weak in passenger cars.³ It is to be expected, however, since Wall Street itself has an obsession: that of the quarterly result. This, however, does not bode well for corporations that have to last generations.

Japan seems to lack this problem as investors are perfectly happy for their companies to see out a longer term. While there are exceptions, Toyota has been mostly left to its own devices, its management opting for a gradual evolution of its strategies, cutting costs of manufacture and appointing westerners to the board. It builds, for instance, the Camry and Corolla in more locations than any one US model.

It would be foolhardy to say that Toyota is impregnable. It has weaknesses, in that its cars are considered the equivalent of domestic appliances: reliable but uninspiring. Detroit had attempted such cars before, often with Japanese input. And it found that these models were not true to the various brands owned by Chrysler, Ford and General Motors.

The brand orientation, which necessitates long-term thinking, is what Detroit needs.

This is a bold statement as GM-watchers may be able to point to a failed era where the company did just that. Buick, Cadillac and other GM divisions were, the company claims, run as brands. But this is not true, at least not branding as most professionals understand it. GM made the classic mistake of equating sales to branding: all it did was to regroup into a geographical sales structure and expected its regional heads to maximize sales.⁴ Little consideration was given to the meaning behind each brand, nor was there feedback from consumers. The experiment was deemed a failure.

Others may also point to the failure Ford has had with its brands, even if it has been credited with being a good brand steward of properties such as Volvo and Aston Martin, two which it had acquired in the 1990s. Jaguar, it is pointed out, was always a division that kept needing investment, never making anything for Ford, despite it paying US$2·5 billion. But there, too, Ford misunderstood the Jaguar brand, lumbering it with passé designs that the marque’s customers did not want. While it never wound up merely badge-engineering Ford cars, it cannot be easily argued that Ford’s failures were due to brand management.

The talk around Detroit is of rationalization and killing off brands, getting its costs and sales more into line. GM, it is argued, may have to be content with being a global number-two, and Toyota can remain in its top spot. Retrenchment seems to be the theme.

It’s true that the Big Three need to leave or at least reconsider sectors where they have not created products that the customer wanted. But are they listening? There are enough tools out there on the blogosphere to show that, for example, Ford buyers would prefer the latest European Focus rather than the model it is currently selling. But only GM has made any headway in blogging and listening directly to consumers’ feedback. Ford is blinded by the fact its old-tech Focus is selling well, without realizing that the same behaviour turned the original Ford Taurus from class leader to a has-been model line in less than a generation.

Most of the techniques have existed for decades. Retrenchment and rationalization were pursued by British Leyland in the 1970s on. The company now exists, other than the Jaguar and Land Rover businesses, as an independent company making one MG model, as a division of Shanghai Automotive Industry Corp. Jaguar and Land Rover are owned by India’s Tata Motors.

Toyota, the darling of the motoring press, particularly for its hybrids, does not pursue retrenchment. It is easily argued that it does not have to. But it has been clever in filling niches and using a minimal number of platforms to create a wide variety of cars—something Detroit’s Big Three were once credited with doing and needs to again. Right now, it’s looking at ways to cement the lead, especially in a cost-cutting programme—in the belief that it’s better to do this calmly than being forced to.⁵

This paper deals first with some of the ideas being bandied about the US auto industry for starters, then groups them into techniques that could save the Big Three.

Troubling thoughts in Detroit
Ingrassia⁶ points out that the Big Three have shed 269,440 employees since 2000 and lost a combined $67 billion in the last three years—and that’s not even counting Chrysler for all 12 months of 2007. But at the same time he points out that Fiat turned itself around and posted record profits. Nissan went from lossmaker to profitable in 2001. Chrysler itself was turned around by Iacocca in the 1980s.

The industry, he says, has at least made moves on the union front, which is one of its biggest hurdles.

But some of the ideas that he has found executives mentioning in Motown show the usual maximize-profits-now mentality that landed the automakers into trouble in the first place.

GM
GM has eight brands, and it is believed, some need to go. In fact, GM has more than eight, once one starts counting Opel, Vauxhall and Holden in its overseas arms. Ingrassia reports very geocentric thinking from Detroit: ‘If you’re shopping for a midpriced sedan, for example, G.M. has six. Buick by itself has two. Toyota, by comparison, has just one—the Camry, which sells nearly as many vehicles each year as all six of G.M.’s offerings combined.’⁷

It’s not totally true. Even in the US, Toyota has a Lexus sedan costing what a well equipped Camry would cost. In its home market, Toyota ?elds more than six mid-priced sedans, selling to a smaller total population. While this is a straw-man argument—foreign automakers have a small share in Japan and Toyota nears 50 per cent⁸—the quantity of entrants in any sector is generally not a problem.

The important thing is that each brand is well defined enough without cannibalization. Ingrassia indicates that GM CEO Rick Wagoner is trying to consolidate sales’ channels without trimming the brand line-up. This makes total sense, because there is nothing that suggests that one manager could not oversee two or three brands. The Japanese have generally kept trim structures for its brands. Toyota itself manages three. Having one divisional head oversee two or three brands can work if there are no favourites and each brand’s positioning is well defined and understood.

The short-term thinking is that Saab, Buick, Pontiac, Hummer and Saturn should die. This is the same thinking at DaimlerChrysler that led to Plymouth’s demise. But it is not the same thinking that led to Oldsmobile’s, a GM division, at the turn of the century.

Oldsmobile became an untenable brand for GM because it occupied a very similar market niche—price-wise and psychographically—as Buick. Purists will be able to nit-pick that argument as there were differences between the buyers: Oldsmobile ones sought American quality and tradition, while Buick ones sought presence without arrogance. However, the reality inside GM was that Oldsmobiles were not really given a distinctive character and given that one of branding’s core tenets is differentiation, the brand had failed.⁹

Plymouth, however, was on its way to becoming a distinctive brand with its own design language. Chrysler had already débuted the Plymouth Prowler, a hot rod acting as a halo car for the brand. The next model, the PT Cruiser, was about to be launched, débuting a retro design. The remaining Plymouths, developed as Dodges with different trim, were given scripted badging that hinted at the brand’s more youthful, lively positioning for the 21st century.

A Plymouth division, had it not been for its cancellation under DaimlerChrysler, would have expressed American youthfulness—the PT Cruiser’s initial success illustrated as much—while Chrysler itself would have remained premium, and Dodge sporty.

Instead, Plymouth products were rolled into the Chrysler marque, confusing that brand—diluting it and forcing a repositioning into a sort of American Volkswagen. At least then it posed no greater threat to some of Mercedes-Benz’s lesser models. But Chrysler lost a distinctive brand with value-leading models—which would have helped it today in an age of high fuel prices. Plymouth had stayed away from SUVs and trucks—a great brand image for 2008.

The brand-trimming argument is what caused BL to kill Triumph’s saloons and MG’s sports cars a generation ago. The thinking was that Triumph and Rover saloons competed in the same sector—based on price, they did.¹⁰ Based on brand, they didn’t. There was similar thinking that led to the closure of MG—because Triumph, it was decided, already had a corporate sports car.

The consequence that played out over decades was that BL’s successors lost their economies of scale.

BL was starved of investment, however, which meant it could not have realistically fielded two identical cars with different badges for long. But it had already made steps to group Austin and Morris together, then Jaguar, Rover and Triumph. One divisional head could have overseen well defined brands, putting a sporting version of one saloon into Triumph’s range, and a traditional one into Rover’s. Experts generally agree today, with hindsight, that the failure to understand the distinctive brand attitudes and brand loyalty behind each BL brand caused credible models to be axed.

Even Toyota has been careful in Japan. It fields, for instance, mid-sized front-wheel-drive sedans such as the Camry and rear-wheel-drive models such as the Mark X. They look fairly similar. But it understands that they appeal to different buyers in a market where consumers are likely to be loyal to model lines in the way US buyers are loyal to brands. If this holds true, then Chevrolet, Saturn and Pontiac can coexist, for example.

There is no need to ape Toyota just because it fields just three brands in the US. No US automaker can afford to rationalize its range to that extent, because none has been able to show that a single American brand can sell twice the volume of two defunct brands. A Chevrolet Cobalt might not be able to fill its own shoes as well as that of a Pontiac G5’s, if Pontiac were to be axed. It’s just as likely that those Pontiac buyers would go to the imports. Historically, did Oldsmobile and Plymouth buyers remain with GM and Chrysler after their parent firms killed them?

Brand axeing should take place in cases of overlap or ill de?nition—and a recent example in Japan would be that of Mazda, which bid farewell to many of the marques it tried to create in the early 1990s (such as E?ni and Eunos).

Saab is a distinctive brand that has been starved of new models for years, but it certainly isn’t in as bad a shape as any of Mazda’s old marques. It has two sedans on Opel Vectra platforms, by themselves not that successful. An SUV was put into the range to stop buyers from leaving the marque. Saab’s problems are not down to a brand that has a strong aircraft heritage, the warmth of Swedish culture and a history of innovation—messages that are still continued in its marketing. Saab’s problems are due to the dearth of new models, which means that it fails as a BMW or Mercedes-Benz rival.

It has no ready overlap in the GM universe, and all the brand really needs are new models. GM has made some headway in putting Saab development with its German company Adam Opel. What it needs Stateside is to look at Saab alongside a non-competing GM brand—and any are compatible. In Australasia, Saab is sold alongside HSV and Hummer, two other premium GM brands.

Modern communications could see a very effective platform engineering programme, which GM is already putting in place anyway. This means one team is working on the Opel Corsa E and Daewoo Gentra replacements, which will be sold in the US as the Chevrolet Aveo successor next decade. GM Europe is working on mid-sized cars such as the Opel Insignia and the next Chevrolet Malibu. And GM’s Australian arm, Holden, created the full-size platform underpinning the Holden Commodore and Chevrolet Camaro.

This programme simply needs to be extended further to creating niche vehicles for Saab as well as replacements for its current range—and there is evidence that GM already got that memo. Buick should benefit from this, too: a Lucerne replacement could easily have been developed alongside the Commodore.

Similar arguments could be made in support of Buick’s presence. While that brand has trimmed models in recent years, what it does field is distinctively styled and its brand, too, is well defined. Sheetmetal might cost money, but the majority of R&D goes into automotive architecture—stuff that customers cannot see. Buick and Hummer appeal to very distinctive buyers who are not catered for elsewhere, and Hummer itself is leading the charge into international markets.

That leaves Pontiac and Saturn, which is already benefiting from globalization. Pontiac fields two rebadged Holdens: a large sedan and a truck. Saturn is becoming the American name for Opel: it can easily go from import-fighter to import-seller, provided it keeps its no-nonsense approach to retail, one of its main differentiating factors.

GM has used the rebadging idea well in some markets. In Britain, most Vauxhalls are really Opels—in most of the range, the model names are even the same. For years, Holden used the same method, though now it rebadges several Daewoo models (Daewoo is another GM brand). There is no reason for Pontiac not to have some Holdens, with the rest of the range selling extreme-performance models made in the US. It would increase economies for Holden. Saturnized Opels would also help Opel in Europe reach greater economies there.

If there is one thing that history has taught us is that tastes are cyclical. Muscle cars may be wrong for 2008 but they may be right for 2012. If Pontiac is killed off, can GM successfully deal with that sector then?

The above are cursory brand analyses only. No one should say that that Saturn’s only differentiator is a no-nonsense retail approach. There are plenty of other reasons that Saturn is distinct from Chevrolet or the other automakers’ brands. And those other reasons, especially considering the buyer, probably won’t overlap as greatly as a mere financial, BL-style analysis would suggest.

In fact, Aaker’s ?ve brand equity targets¹¹ are instructive and it is not impossible to maximize all of them, propelling every GM brand to varying degrees of success. GM and its investors need to remember history and why Britain still has a car industry, just one dominated by Japanese and foreign makes.

GM needs to begin by defining its brands and engaging consumer help to get there. It has a good enough support base via its blog, Fast Lane, to which Bob Lutz, its product czar, contributes. People believe their ideas are being heard and Lutz has been making many of the right moves by enlisting the help of global GM divisions. That can only be enriching to brand equity.

One brand that has escaped criticism for the most part is Cadillac, which has at least sorted its design language and styling out, produced products that Americans (especially style-conscious younger consumers) want,¹² so either GM got lucky—or GM has the skill set already within its company.

GM’s other great asset, which it is finally using now with Lutz’s top-down endorsement (another necessity in branding), is its global divisions.¹³ Each has been made a centre of excellence. Each is part of a greater global structure, entrenched in GM behaviour over decades. Toyota centralizes a lot more of its product development, but GM may be able to have each centre work in tandem and bring products to market more quickly.

Ford
Ingrassia is more optimistic about Ford, which has been slimming down, selling Aston Martin, Jaguar and Land Rover. But he is critical of the company’s product range, and rightly so.

At the time of writing, Ford has been enjoying healthy sales in the US with its Focus compact car. However, car enthusiasts have been critical of this model, since it uses an old platform. Even México has the new-platform model in its range, leading some to disbelieve Ford’s reason that the newer model would be priced too highly to be competitive in the US. (Ford also sells the Mazda 3 in the US at a competitive price, and that is on the newer platform.) Alongside the Honda Civic, the Focus seems old hat.

However, expensive fuel and Ford’s widespread US dealer network have meant that the Focus is being snapped up. Some of this is probably due to brand loyalty, too: those that stuck by the company in the days of the truck and the Explorer SUV are looking at the Focus as a simple, bugs-ironed-out model.

As mentioned earlier, strong sales are not always an indicator of long-term brand strength. Should fuel prices come down and people begin repeating their less considerate, energy-consuming behaviours, will they turn to Ford? Many Taurus buyers did not return to the company when they wanted another mid-sized sedan: they went to Toyota and Honda. There are only so many years that a company can sell an old-platform design, and in the age of the internet, car buyers are more savvy than ever.

Ford has a bright spot, says Ingrassia: its CD338 line of sedans (Ford Fusion, Mercury Milan and Lincoln MKZ). He is right, as these have also managed to be sold in South America as well, as premium models. Using an old (but revised and competitive) Mazda Atenza platform, CD338 was developed with good savings, showing that single platforms can be adapted further. The current Taurus, using a Volvo platform, is another example.

But Ford could trim its platforms further and make use of its international divisions. The Ford Mondeo’s European development duplicated that of CD338, and enthusiasts have been supportive of the European car. Ford is ending the duplication with its next B-sector (supermini) car, the Fiesta, which will be sold in Europe, North America, Asia and Oceania.

Ford’s problems in the past were linked to internal politicking, leading many to dismiss the global model. They cite the CDW27 project of the early 1990s to be an example of a car developed in Europe and failing in the US. Its size was often blamed. The reality was that CDW27 was under-marketed, especially as BMW continued to earn sales in the same size segment.

Facing troubles, and with a new leader in the form of CEO Alan Mulally, Ford may well have realized that being a united company has its benefits.

It could do more, as Australian commentators are quick to point out that their countrymen’s big-car expertise is not used sufficiently. But it does make use of Volvo as a safety centre of excellence, and there are signs of change.

From a branding point of view, Ford may well have sorted things with its core brand, steadily sorting its product range out in what appears to be a medium-term plan leading into the mid-2010s.

It has generally been regarded as a good brand steward for Volvo and Land Rover. Jaguar’s problems were detailed earlier and they seem to have been an (expensive) exception rather than the rule. Aston Martin grew under Ford as well.¹⁴

Volvo has been engineering class-leading platforms for the company, it has a well defined brand centring around safety and Swedish design, and it’s a rare case where the (profitable) status quo should be observed. Mazda is Ford’s sporting brand, and seems to trade well on its Japanese origins and philosophy, with halo cars such as the MX-5 and RX-8.

Its problems rest with Lincoln and Mercury. Lincoln was once a proud brand, but with the demise of the Town Car, no longer fields a large luxury model to rival the large Lexus LS and the top Cadillac. Instead, its models are warmed-over Fords, making sense from a cost perspective. Lincoln buyers are indeed different, brand-wise, from Ford ones. But surely they are discerning enough to notice that what they drive does not look that special?

The good news for Lincoln is that it has downsized, something that it failed to do in the 1970s until GM had already made its move. However, Ford is falling into a trap with cars that do not support the Lincoln brand well, and it can hurt the company in the long run. A brand vision was once developed and show cars built (such as one called the Mark IX), demonstrating a renaissance and a design language for the brand. Little seems to have come of it other than adopting the grille design. It shows short-term thinking and Lincoln is being hurt until it can launch more interesting cars. It seriously needs a brand strategy outlined.

If Lincolns are not special, then what of Mercury—which has languished for over a generation? The brand is nearly invisible, it sells cars that are considered upscale Fords, and the company’s financial problems meant that any distinctive models (such as the Cougar) were cancelled.

Mercury could be fixed if Ford simply examines its Japanese affiliate’s range at Mazda, which develops more models than US consumers see. If the brand were defined as a quality import-fighter, it could have a chance at distancing itself from its warmed-over-Ford image. An obvious candidate for “Mercurization” would be the next Mazda MPV.

Chrysler
Chrysler, the smallest player, is now under a private equity firm’s control and is not particularly well positioned. Once a highly respected company in the 1990s, Chrysler had lean R&D processes, exciting niche models and the admiration of American businesses. Forbes called it the Company of the Year.

This was appealing to Daimler-Benz AG of Stuttgart, which took over Chrysler in the late 1990s. As discussed, the Plymouth marque was a casualty. But the takeover was poor in other areas: there were cultural clashes, the brands were never defined to begin with, and the newly merged DaimlerChrysler found dif?culty getting economies of scale with the platforms. Lean R&D suddenly seemed more cumbersome. And the resignations of many of Chrysler’s old bosses—Bob Eaton, Bob Lutz, François Castaing, inter alia—did not do much for the workforce.¹⁵

Dodge was an easy brand to define, alongside Americanness and sportiness. However, Chrysler went from innovative American luxury—its LH big cars were highly acclaimed, as were their successors—to a sort of Volkswagen, having low-priced models such as the Neon and PT Cruiser sitting uncomfortably with the 300 large car.

Brand-wise, Chrysler is all over the place. Ingrassi is right that the company has not fielded a true luxury car for years. It is cooperating with Chery of China on a small car—which might be too little, too late, when it is launched.¹⁶ And when it is launched, where will it go? It would have been ideal for Plymouth.

Meanwhile, Nissan is building a subcompact for Chrysler in South America. Chrysler is building a minivan for Volkswagen at a Canadian plant.

One scenario is to kill Chrysler off, which would dilute Dodge’s brand—since models such as the Chery joint-venture vehicle will have to be absorbed. It would fit as poorly there in buyers’ minds as the PT Cruiser did with the old LHS and 300M large cars. Dodge, after all, has just released a sports car, the Challenger, a retro-design exercise meant to recall an age when its brand was well defined and proud. The Chery JV model could well look sporty—but if it is an economy model, will Chrysler be tempted to put another marque on it?

Having fewer brands will do Chrysler no favours with its future models. Any disease the parent brand has will simply be passed on. Its saving grace is Jeep, which has not been tarnished greatly; in fact, Chrysler has been quite good at managing that brand and, for the most part, delivering the right product.¹⁷

While it might make some sense to streamline further, buyers make their decisions about a brand quickly. Brands are shortcuts so consumers can grasp their message quickly, hence the need for recognizable brand “attitudes”.¹⁸ And Dodge and Jeep have distinct characters that shouldn’t be tampered with for fear of turning consumers away from that easy recognition and brand equity. Chrysler can be redefined as a quality marque, one with a dose of snob appeal but everyday prices—if it can really deliver that quality. Taking the halo effect of the 300, its most recognizable model, and bringing it on to smaller models isn’t a bad idea—but it remains to be practised.

It will never be a Cadillac rival in the foreseeable future, unless some of those rapid R&D and tight inter-business relationships can return to make it a lean niche-filler. Those glory days weren’t that long ago.

The solutions
First, each of Detroit’s Big Three has some homework to do, in understanding their brands’ visions, what they mean, and what they can mean. They can involve the public via the blogosphere, in a country that has high internet penetration. This will show transparency and a willingness to engage with the American car buyer, whom each company needs to win back. Or, they can do the exercise internally with cross-functional groups, but properly¹⁹—there is no more room for a lip-service nod to branding as there was in the 1990s.

Secondly, the Big Three need to understand just what makes their cars appealing. Aaker’s brand equity elements are a good start but the quest for them needs to be constant.²⁰ The Japanese may have used W. Edwards Deming’s principles over decades to get their quality up. American companies need to leap-frog that by being more engaging, being open where Japanese companies act closed. Continued understanding of consumer tastes via the blogosphere is one method; using that to inform future tastes is another. Feedback is important, and it has only recently played a part in the marcom end of the Big Three. Prior to that it only had customer clinics.

Thirdly, there is an untapped generation, namely the young people who are either too young to drive or getting into their first cars now. What has informed their choices? The author is willing to bet that while there are some who love muscle cars, there may be many more impressed by models that conserve energy.

Fourthly, US automakers are among the heaviest R&D investors—and they need to bring more innovation to the market more rapidly.

Fifthly, they need to realize the effect of a loss of economies of scale. The historical models are there. The key is to build the cars consumers want²¹—something that GM and Ford actually do quite well in Europe. If Levitt is right and there is a homogenization of tastes²²—BMW and Porsche operate on this notion, and Toyota does in the mid-sized and subcompact sectors—then foreign bases need to be used more effectively. It’s not about shutting factories and firing personnel, but being more sincere about delivering for future consumers.

Summary
Killing brands, as any observer of British Leyland has demonstrated, is not a solution when those brands are well defined, contribute to economies and have brand loyalty, recognition and perceived quality. Even if a brand contributes to economies alone, it can be saved through repositioning.

The US automakers need to put in play longer-term thinking. Chrysler is most dire at the moment, and Ford, while leaner, could do more with Lincoln and Mercury. Ford itself has excellent product and needs to show it can overcome regional politics. In neither case should they feel forced in delivering short-term results. In Chrysler’s case it may be able to demonstrate to its owners that it can do well without the pressure of share prices.

General Motors has all the necessary ingredients for survival. It has shown a willingness to engage consumers, find ways of making use of its foreign operations and look at ways of retaining brands and economies of scale.

Being true to their brands can help US automakers get back to a strong position. Setting one’s sights lower and claiming easy victories was certainly not the way Toyota rose to number one. Honda climbed from obscurity to Japan’s number two—and it has one of the US’s top-selling models—by setting higher goals. British Leyland should be a constant reminder of what not to do—unless the Big Three want to wind up being subsidiaries of foreign firms, their marques mere reminders of better times.

Notes
1. L. Iacocca and W. Novak: Iacocca: an Autobiography. New York: Bantam Books 1984.

2. J. Yan: ‘Where Is DaimlerChrysler Heading?’, CAP Online, February 12, 2000, <http://www.jyanet.com/cap/2000/0212ob0.shtml>.

3. J. Flint: ‘Company of the Year: Chrysler’, Forbes, January 13, 1997, pp. 83 ff.; q.v. E. A. Robinson: ‘America’s Most Admired Companies’, Fortune, March 3, 1997, p. F-2.

4. M. Kerbs: ‘G.M. Will Pare as Many as 1,000 White-Collar Jobs’, The New York Times, August 5, 1998.

5. P. O’Connell (ed.): ‘The Man Driving Toyota’, Business Week, July 22, 2005 (also online at <http://www.businessweek.com/bwdaily/dnflash/jul2005/nf20050721_7169_db053.htm>).

6. P. Ingrassia: ‘Who Will Survive?’, Condé Nast Portfolio, June 2008, pp. 86–95.

7. Ibid., at p. 93.

8. I. Rowley: ‘Toyota Set to Top 50% Market Share in Japan’, Business Week, ‘The Auto Beat’, November 1, 2007, <http://www.businessweek.com/autos/autobeat/archives/2007/11/toyota_tops_50.html>.

9. See, e.g., E. Shapiro: ‘Is Oldsmobile Name a Marketing Lemon?’, The New York Times, October 29, 1992.

10. The Triumph brand is owned by BMW, which understands that from a branding perspective, it poses a threat to its core range.

11. D. A. Aaker: Managing Brand Equity. New York: Free Press 1991.

12. J. Yan: ‘The Brand Attitudes of Automobiles’, New Age Branding: Concepts and Cases, vol. 1. Hyderabad: ICFAI Press 2002, pp. 101–13, at pp. 105–6.

13. Remaining divisions such as Cadillac simply need to get the product right: the author understands that its much-lauded CTS sedan, for example, still falls well behind its German rivals on the interior. Meanwhile, Opel does acceptable interiors. This is a single example of GM’s unused assets.

14. J. Yan: ‘The Brand Attitudes of Automobiles’, op. cit., at pp. 111–12.

15. Ibid., at p. 111.

16. Not every company has been successful in cooperating with Red Chinese companies. Chrysler has had some experience with its Beijing Jeep venture, among others, but not with Chery.

17. Some cannibalization has been risked with models such as the Jeep Commander, and its low-end passenger-car spin-offs have questionable appeal for the brand long-term.

18. See, e.g. J. Yan: ‘The Brand Attitudes’, op. cit., and W. Olins as quoted in J. Yan: ‘The Attitude of Identity’, Desktop, October 2000, pp. 26–31.

19. See, e.g. J. Yan: ‘The Brand Attitudes’, ibid.

20. Toyota’s success factors are discussed in ibid., at pp. 108–9.

21. See, e.g. G. Green: ‘Meet the Inspirational, Indefatigable Geoff Polites’, Car, June 2008, pp. 130–3, at p. 132.

22. T. Levitt: ‘The Globalization of Markets’, Harvard Business Review, vol. 61, no. 3, May-June 1992, pp. 92–102; cf. M. Griffin: ‘From Cultural Imperialism to Transnational Commercialization: Shifting Paradigms in International Media Studies’, Global Media Journal, vol. 1, no. 1, fall 2002, <http://lass.calumet.purdue.edu/cca/gmj/fa02/gmj-fa02-grif?n.htm>.

This paper has also appeared in CAP Online.

Thomas Gad
Chairman, The Medinge Group
Founder, Brandflight
thomas.gad@brandflight.com

Stanley Moss
CEO, The Medinge Group
Founder, Diganzi
diganzi@gmail.com

When Scandinavians read news about global warning, it somehow does not feel like news to them. It is more like a repetition of something they have heard and feared for years. A long-standing awareness that environmental protection of unique natural resources was necessary has been under discussion at home for decades. They understood the threats, the consequences of pollution and the price to be paid for damaging the richness and variety in flora and fauna. They knew this in turn would severely change the climatic conditions on earth. How did they know this? Because it was a part of their education at elementary schools in Scandinavia for the last 20 years.

Energy saving in this region has a long history as well. During cold winters, when electricity produced in local clean-water generated power stations was insufficient to cover the demand for electric heating, Scandinavians were forced to buy power often from dirty coal-fuelled power stations in eastern Europe. Events like these were a part of their upbringing and it created a deep-rooted understanding of the issues and consequences. Sustainability has never has been such a dramatic story as it now is in world media. Scandinavians find it rather boring, a presumption they probably share with the Germans. After all, the influential German Green Party was established 1985 and Scandinavia has had its own green parties and powerful political factions for as long as people can remember. Thus, last year’s environmental warnings did not really shake anyone up. People simply shrugged their shoulders and said, it had to happen some day in the face of all the reports about global warming. In essence it was old news to them.

What impresses branding professionals is how powerful the concept brand, ‘Climate Change’, has become and how quickly it developed. Another surprise: how strong the personal brand ‘Al Gore’ has got, certainly more potent than if he had simply become another president of the USA. It does demonstrate to Scandinavians the abiding importance of the USA in world opinion-making. Scandinavians have the conviction that this time climate warnings may finally be for real. There is hope that at least it leads to global action.

Inaction by the rest of the world was precisely the problem previously. Nordic citizens felt alone in their vanguard interest about sustainability issues, ahead of their time. It was they and the Germans and possibly the Californians (with smog-stricken Los Angeles) who concepted the first models of responsible thinking. This perhaps sprung out of the New Age movement, which also emerged in Sweden. Nobody else seemed to take it seriously. Swedes later felt sceptical towards the USA for not signing the Kyoto protocol, an erosion of trust over the inability globally to decrease carbon dioxide emissions. After all, the biggest and most consuming nation in the world had turned its back on the crisis after contributing so significantly to its creation.

Sweden’s responsible environmental consciousness is largely political and grew up in combination with the social-democratic tradition and the idea of a welfare state. Government always takes responsibility in setting the rules for social issues. This may explain one reason for the world’s highest rate of income taxation. In Sweden, this so-called Swedish model has lately been under attack, and the new non-socialist government has it on the agenda to adjust the model, so as not to wreck it all together.

There is still a widespread consensus across all political parties about the fundamental principle of governmental responsibility. This consensus about collective responsibility naturally translates over to Scandinavian brands. Scandinavian companies are good at following the rules. At the same time these are nations with small domestic markets and who need to export to survive. They have always been aware of global competition. Scandinavian industries have complained that the social responsibility they have borne has been excessively one-sided, and that it has made Scandinavian products more expensive. This causes Scandinavian jobs to be threatened. Yet, as there are few changes in the policies, so Scandinavian industry has long been compelled to accommodate the expenses of social and environmental responsibility in its operations and costs.

The Nordic paper industry, a world leader, has manufacturers like SCA and Metsä-Tissue and strong European consumer brands like Lambi, Libero, Libresse, Serla and Katrin. These brands are good examples of companies who not only adjusted to the sustainability rules, but developed environmental policies far beyond what the regulations required. They invested in new technologies to turn dirty production into a cleaner one, for minimal impact on nature.

The strong global sustainability trend has led into more self-critical discussion. Industry and government ask: are the brands and businesses in Scandinavia more progressive than the brands in the rest of the world, or have they lost their competitive advantage? Global attitudes move quickly now. Scandinavian brands feel threatened on their own ideological home turf.

Veckans Affärer, the biggest weekly business magazine in Sweden, published its second yearly “green” issue in 2007. The big question posed concerned national sustainability leadership. They asked: who is leading? The magazine editors concluded that there is a “wait-and-see” attitude in Sweden and in Scandinavia at present. What does the widespread global alarm require companies and brands to do more than they are already doing? And how deep will be government’s role in this new climate? The government in Sweden for the first time in more than a decade leans non-socialist and more liberal, a new political landscape. What exactly will this government do, how much will it regulate, and how much responsibility will it delegate to industry?

Scandinavian brands historically regarded green issues as a way to get PR and nurture better image domestically, but the message was not promoted abroad. Companies felt the public out there did not care that much. Now the situation is different. Most serious companies and brands in Europe have some kind of visible sustainability strategy. Green issues have moved from an “extra” to something “included”. Companies and brands are subjected to greater scrutiny over the reality of their sustainable credentials.

Experts today acknowledge how much more difficult it is to stand out using sustainability as a branding tool. The question is now more one of accountability; what do the companies behind the brands actually do, not simply intend to do?

Today, companies feel a pressure to demonstrate anything, and it can often turn into something resembling a bad joke. When Air France desperately offers a ‘carbon footprint calculator’ prominently on their website home page, so that you can calculate the carbon footprint of your flight with the airline, little can be done with that information. All airlines confront the consequence of a basically dirty technology and no real light at the end of the tunnel.

For a large polluter like an airline, every reduction is a positive one and proper action demonstrates the sustainability of your brand. A good example of this hands-on Scandinavian approach, a kind of imperative to impress the national audience, is Scandinavian Airlines’ (SAS) very successful Green-Landings programme. Advanced communication and coordination between aircraft navigation computers and the computers in the air traffic control system have been developed. This yields the capability to calculate the most environmentally friendly flight path. SAS has already performed over 1,000 green landings, and every landing saves 100 kg of fuel and 200 kg of carbon dioxide. SAS knows that once all its planes systematically participate in the programme carbon dioxide emissions will reduce by 90,000 tons per year, equalling emissions from 20,000 cars driving 15,000 km yearly on average. SAS, after three near-to-crash incidents, is resolutely selling off an entire ?eet of Bombardier de Havilland DASH-7 aircraft, costing the company an estimated €250 million and damaged credit ratings. This is being done to preserve SAS brand equity, for which responsibility, reliability and safety are key values.

Another Swedish brand, H&M, has taken a leading position in sustainability issues and earned a degree of acclaim for it nationally and internationally. The company operates in 28 countries and has more than 60,000 employees all working to the same philosophy: to bring the customer fashion and quality at the best price. The brand is now one of the most identifiable, visible and valuable of Scandinavian marks. H&M has leveraged its brand equity from cheap clothing into fashion brand by co-branding with famous designers like Karl Lagerfeld, Stella McCartney, Victor & Rolf and Roberto Cavalli. Alongside its commercial success, this company demonstrates solid principles of entrepreneurship and a strong sustainability positioning, all the more dif?cult in a business where unnecessary over-consumption, cost-shaving, and issues of ethical production will be the inevitable accusations. H&M has grown into one of the most demanding fashion producers in the world, through determined sustainability policy, hard work, and not just sweet talk.

Today the company stands as a benchmark for the industry. H&M’s active code of conduct encourages compliance with local labour law, statutory pay and working hours, the right to organize and bargain collectively, a ban on child labour, a ban on discrimination, a ban on forced labour, health and safety in the workplace, and compliance with local environmental legislation. All suppliers are monitored by independent auditors. H&M is such a major buyer that this ripple effect has been felt throughout the entire supply side, especially in China. Status as an H&M supplier has become a crucial demand when negotiating production contracts and prices with these suppliers.

Many discussions occur about how to engage the alarming global warming scenario. Scandinavia has a social tradition which encourages state-initiated consensus between politicians and industry, with a reliance on entrepreneurial creativity. This got a boost during the dot-com boom, when mobile phone development, largely achieved by Nordic engineers, resulted in the establishment of world-leading brands Ericsson and Nokia.

Sustainability is not exclusively concerned with environmental questions, but also with issues of public health. Traditional Swedish controls on alcohol, a severe anti-drug policy, high taxes and state-shop-monopoly contradicts the reality that the state owns one of the most high-profile Swedish brands, Absolut Swedish Country Vodka. This brand first began to gain international prominence in New York at the time when Russian vodkas were banned, a response to the Soviet invasion in Afghanistan. The ban came to include the Canadian brand Smirnoff for the simple crime of having a Russian name, thus driving more vodka-drinkers to alternative labels. Propelled by a rise in the global demand for clear spirits, its popularity in gay culture, trendy bars, with the art community, by clever artistic advertising and a clean, almost-medical design, Absolut came to personify the Swedish attributes of purity and political and environmental cleanliness, represented by a bottle. The current Swedish government has put Absolut up for sale, and all the world’s spirit conglomerates are lining up to bid. Some nationalistic Swedish investors would prefer to keep this iconic national brand Swedish.

IKEA was rewarded last year by the international branding think-tank Medinge Group with one of their yearly Brands with a Conscience awards. The award referenced IKEA’s anti-corruption stance, speci?cally citing its business in Russia, where 300 invited guests for the launch of a new Moscow store were unceremoniously turned away from the celebration. Official permits had not been delivered, owing to IKEA’s refusal to pay bribes to the authorities. In Sweden, IKEA’s homeland, the company is considered to be a sustainability leader among Scandinavian brands (together with H&M and Volvo). IKEA’s strict environmental policy aligns closely with founder Ingvar Kamprad’s sparse and lean management principle—no waste in the economics of the business, environmentally or with energy. IKEA took the initiative to promote low-energy products and is today the leading distributor of low-energy light bulbs. ‘Good design for everyone’ is one of the founding principles and the attitude generally is very democratic and Fair Trade-oriented concerning suppliers, employees and customers.

With this much history in place, sustainability in Scandinavia appears equivalent to a hygienic factor, and consequently a bit boring. Once the claims have been made, actions are more important than words. Companies have discovered it is critical to communicate value beyond sustainability itself. A good example of how this works can be seen in instances where organic food and sustainability are considered in tandem. It is not enough to create the impression of responsible conscience with the consumer. One must deliver more to ensure commercial success. With organic food, the good feeling and the perception of better and more natural taste is important. Svenskt Sigill, an ingredient brand for a variety of different Sweden-produced food products, emphasized its Swedish origin and the good taste (‘Home-made’ is the slogan), with greater prominence than the fact that its line is produced to stricter sustainable standards than ordinary food.

The importance of combining sustainability values in the brand with higher product performance can be seen in the Swedish start-up EcoMarine’s ?rst non-toxic biological paint for boats. Toxic paint has long been a problem for environmentalists in Scandinavia. Boating is a uniformly popular pastime; in fact, most households in Sweden have at least one boat, sometimes several. Frequently these are rather large sailing or motor craft. All existing paints for boats are either toxic to repel growth of algæ and sea grass on the hulls, or non-toxic but lack the repelling effect. Toxic paint is forbidden, since it releases amounts of pollutants into the sensitive waters of the Baltic Sea and the otherwise pristine lakes in Sweden. Recently EcoMarine introduced a paint formulated with natural bacteria, which not only keeps algæ and vegetation off the boat hull, but also creates a slimy surface which increases performance and speed of the boat. Environmentally speaking, it decreases the amount of energy needed to drive the boat through the water.

The performance argument is always the winning one. It is a similar position to that which promotes biofuel ethanol, which increases the performance of the bio-powered car, in comparison to gasoline-fuelled engines of the same size. Saab successfully employed this concept in their brand building, until the argument lost some of its lustre when it became widely known that ethanol (although itself non-carbon dioxide-producing) requires objectionable quantities of energy and carbon dioxide emissions to produce and distribute.

The combination of good conscience and good performance is the wave of the future in Scandinavian sustainability innovation and branding. Swedbank-Robur’s highly successful fund management has shown the market-place real dedication to sustainable investments for 15 years. They consistently argued that such investments could perform very well, or at least as well as non-sustainable ones. Swedbank-Robur has proven that a combination of doing good with good financial performance is a winning proposition. Proofs like these of a successful balance between the opposing sides of the sustainability discussion will always make a huge impression on performance and consensus-seeking Scandinavians

This paper has introduced the argument that Swedish brands have moved beyond other countries’ positions on sustainability. There are lessons to be learned here about the implications for other brands. It is clear that non-Swedish brands will follow the same trajectory, raising their awareness of challenges, solutions and consumer attitudes. Countries without the social democratic model may find it more difficult to follow Scandinavia’s lead, but with the volume of alarm raised every day in world media, and the UN’s recent report which documented the urgency of global warming awareness, velocity towards sustainable behaviour can only increase.

Somewhere out in consumer world there is an opportunity to develop an area of research which evaluates the effectiveness of how sustainability incorporates into the real fabric of organizations. This could be a sustainability orientation measure, which considers the extent to which sustainable thinking is central to decision-making. A project done in Sweden called Brand Orientation Index looked at the degree of brand orientation of 500 Swedish companies; perhaps this is the model to replicate on the course to a global sustainability orientation index? Where else but in Sweden will vanguard thought like this occur.

This paper also appeared in the Journal of Brand Management.

Tony Quinlan
Narrate Consulting
tony@narrate.co.uk

Introduction
Let’s begin with clearing up a potential misunderstanding. Storytelling is a misnomer. It conjures up the image of a passive audience sitting listening to someone with the charismatic, persuasive power to entrance them. It revolves around a carefully constructed story designed to carry you out of the day-to-day to somewhere else and change your thinking while you’re there.

To some managers, it sounds like a dream come true. To most of us, however, that would be a nightmare. In an organization, charismatic persuasion and the ability to direct someone’s thinking smacks more of cults and propaganda than modern-day work practices. (And cults are less effective as organizations—they are typically blind and less resilient.) If this was what you were hoping for from this article, please leave those thoughts at the door.

What is on offer here for proponents of employee branding—or “employee engagement”, its more trendy cousin—is more powerful and more positive than that simplistic view. The real power and opportunity for using stories in organizations is in listening to stories, helping others to create their own authentic stories and making sense of the stories told.

Why stories?
Why tell stories in the organization at all? After so much research and honing of practice, good communications departments are skilled at producing clear messages, good copy and straightforward values or mission statements. With such clear direction, good data and evidence of what to do next, shouldn’t that be enough?

Sadly not—because neuroscience shows us that people rarely make decisions on the basis of rational analysis of data at the best of times. And when they are under stress, or being measured against a target, or being asked to change their behaviour, rational argument and values do nothing to persuade them.

Thinking otherwise, though tempting, is trying to lever human behaviour and organizational culture into a process that can be analysed, planned and repeated. We all know from our own experiences that that is patently not the case.

Instead we know, from Gary Klein’s Sources of Power: How People Make Decisions, that people make decisions according to the cognitive patterns they have created in their heads. Indeed, they don’t even make decisions according to the most appropriate pattern, but rather to the first pattern that the perceived situation fits.

These patterns can be viewed as internal, personal stories—and understanding these stories will take us a long way towards understanding patterns of behaviour in the organization. By sharing alternative stories, and helping people see the world through the perspective of a different story, we can open up the possibility for others to shift their worldview and subsequently their behaviour.

A valuable tool in Narrate’s work is the Cynefin framework (Figure 1), created by Dave Snowden, and the concepts behind it. It’s applicable in many different areas, but can be used to distinguish key themes, areas and projects and the recommended approaches to them.

Figure 1
The Cynefin framework

In a vastly simplified description, culture falls into the Complex domain (for a fuller explanation of the Cynefin framework, read ‘The New Dynamics of Strategy: Sense-Making in a Complex and Complicated World’, referenced at the end of this chapter). Here causality is blurred, many different elements combine to create overall effects and results will never repeat exactly.

In this domain, control is impossible, influence essential. Here, patterns of belief and behaviour dominate.

It also requires different actions—trying out certain elements, waiting to perceive the results and then acting to reinforce the emerging patterns or disrupt them if they are negative. It can be about creating boundaries and attractors, by reinforcing desirable behaviours and disrupting undesirable ones.

By contrast, the complicated domain does have repeatable cause-and-effect chains, although these may be extended through various stages. Here, we can analyse or bring in expert help to identify how results are created and impose processes to repeat them. Too often, we have tried to cram employee engagement into this domain.

Given the vagaries of human behaviour and belief, I believe organizational culture sits squarely in the complex domain. I suggest that management—based in process, measurement and hierarchy—is more inclined to sit in the complicated domain.

What is engagement?
Not persuasion, for a start. The desire to see engagement as a one-way communication in which “employees are engaged” is evidence of an old-fashioned mindset—power, decisions and control lie high up the organization. Those further down the hierarchy are tasked mainly to obey. Here, engagement is merely a means of persuading people, while giving an illusion that the choice is theirs.

This view cannot be effective for much longer. Compared with even 10 years ago, people in organizations have changed. The old days of a willing, compliant workforce were an illusion. The truth was always that organizations have no control over people, only levers of influence.

No longer willing to take at face value what’s being told to them by the organization, people have far greater access to information than ever before, and more ways of expressing their own opinions. Equally, they are more experienced at deconstructing any organizational communications—making them masters of cynicism when it comes to the usual parade of internal communications tools and messages.

In the ’80s and ’90s, much of the goal of internal communications (such as it was in those days) was to inspire company loyalty—I still remember being asked why I wasn’t more loyal to the organization. Yet the idea of inspiring loyalty was fundamentally flawed—it’s a two-way thing. Once the organization had proved that it was not loyal to you—as most did repeatedly in those of “downsizing” and “re-engineering”—it became apparent to all but the most hardy company men, that loyalty to the organization was not a long-term secure prospect.

In the ’00s, we’ve abandoned the concept of organizational loyalty, been through internal branding and are now on to engagement—how do we engage our employees? And yet the same applies: engagement is a two-way contract. And while our organizations are very keen to ensure our people are engaged, how engaged is the organization with our people?

Until the organization becomes engaged and concerned about the well-being of its people, engagement is going to be a limited concept—and one doomed to fail in the same manner as loyalty did.

To borrow a truism from knowledge management, ‘Engagement can only be volunteered, not conscripted.” But before that can happen, there must be a level of trust, which itself only arises through a sense of being seen and heard.

Working with stories
Although when I first came to using stories in organizations, it was about crafting stories to communicate particular messages, this is a role that has been almost completely dispensed with as our practice and use of stories has developed.

The Narrate model (Figure 2) sets out the general approach. It begins with a general sense of what the opportunity is, but the first step is then to gather material to map the current perceptions and culture—collecting real, authentic, naturally-told stories. It’s critical to realize that listening to stories emerge is more useful than crafting stories or telling them in the early stages.

No single story will ever give you an accurate picture of the organization—but the patterns that emerge from multiple stories, the shapes of events and beliefs, the archetypical characters that emerge are what provide the most powerful opportunities to view the world as others see it.

Similarly, few single stories will engage with employees. Better, instead, to support them with multiple viewpoints and perspectives on a situation, and then facilitate them understanding their own roles and stories ahead.

Having said that, it’s important to note too that even listening or diagnostic events generate expectations among the audience. Every intervention is a diagnostic and every diagnostic is an intervention.

With all this material, there is then a need for sense-making exercises for key members of the organization. The patterns that emerge may indicate a gap in material which may lead to more story gathering. The patterns may also have implications for the original impetus for the project—which may need reshaping or rescoping as a result.

Figure 2
Process map for narrative engagements

With a greater understanding of the culture and the opportunity or need for engagement, it’s then possible to identify leverage points in the organization where relatively minor actions will produce significantly larger results. At the same time patterns will have emerged that are healthy or unhealthy and these can be reinforced or disrupted as required.

From here, all the range of HR, change and communications’ tools can be brought to bear on the issue—with narrative clearly playing a part within that.

Cognitive patterns
One of the great assumptions of communications is that if we give people clear instructions and data, they will change. That is, we as human beings process information to make decisions. As I mentioned earlier, recent advances in neuroscience show that this is wrong—that instead we make decisions by processing patterns, not information.

This has important connotations for the standard model of internal communications and employee engagement. It nullifies traditional practice of clear messages, well-written copy, etc.

Far less the frequent approach of quantities of data to prove a hypothesis. If we already have a belief about how the world works, it takes significant quantitative and qualitative data to shift that.

Our inclination as human beings is to make the information and data we are given fit our preconceived ideas. It is not until there is significant difference between the data and our model that we open to the possibility of our model being wrong.

So, in communicating effectively—engaging—with people within the organization, we must look for ways to bring their cognitive patterns to awareness. Not to change them, but to allow for the possibility of greater understanding and common negotiation of a shared viewpoint.

As Burns put it:

These cognitive patterns are, from one perspective, simply stories or scripts that predict consequences and inform behaviour and decisions—perspective filters that determine how we see the world.

Data, principles, information are usually context-less
One of the other core reasons for using story is the poverty of traditional value lists and mission statements as communications tools. The following story from Wikipedia about US congressman Lynn Westmoreland demonstrates it beautifully:

Westmoreland appeared on the Better Know a District segment of The Colbert Report on June 14, 2006. Stephen Colbert noted the fact that the congressman has co-sponsored a bill to place the Ten Commandments in the House of Representatives and the Senate. When asked to name all the commandments he was only able to remember three; one, “don’t lie,” was only partially correct (the Ninth Commandment is an injunction against “bearing false witness against your neighbor,” not lying per se). Westmoreland’s press secretary claims Westmoreland actually got up to about seven of the Ten Commandments before petering out, but that part was edited out. Said the secretary, “I challenge anybody outside of the clergy to try to (name them all).”

This reinforces something critical in most organizational communications. The 10 commandments form a solid base for much of the west’s legal, moral and ethical practices, regardless of your personal religion and belief, yet few people can name them.

That list of corporate values, principles or beliefs that has been slaved over for so long and encapsulates the organizational ethos. What are the chances of remembering them? And what are the chances of actually acting on them?

Now, parables and stories on the other hand are memorable, understandable and actionable—because they are more in line with the way our brains and behaviour patterns work. But on the surface, they’re just not as intellectually impressive as ‘Thou shalt make the customer thy God.’

Stories also carry with them context and causality—allowing audiences to determine when and why actions were taken, something that pure principles cannot do, therefore creating the (usually erroneous) assumption that they apply at all times and in all situations. (The reality, of course, is that they don’t apply universally, and most people adopt workarounds when the principles don’t apply. The difficulty, however, becomes when is it acceptable to ignore organizational principles and when is it not? Not is usually the moment just after the work-around has failed and the manager needs a scapegoat.)

An anatomy of stories

What makes up a story?
People talk about stories in organizations frequently, but the object of the discussion is rarely a real example of an influential, appealing story. Too often, it’s a disparate series of supposedly important events that occurred to a faceless group of people. For the sake of those involved, it usually conforms to the standard organization planning process.

In school, we’re taught that a story has a beginning, a middle and an end. This originally came from Aristotle’s poetics, so it seems to be a solid basis for thinking about stories. However, a beginning, a middle and an end also describes a snake, so perhaps it’s not going to give us much idea of what an engaging story really consists of.

A sympathetic lead character
First, engaging stories are about people. Ideally, a single person is the main character in any story. Someone with enough in common with the audience to help them empathise with the character.

Organization stories are too often about groups or divisions or, worse still, the overall organizations themselves. But we don’t engage with these stories because we can’t empathise with how it feels to be a corporation or a group. Where stories are concerned, we need single person protagonists. (There are exceptions—sports supporters being a good example of individuals associating with a national or regional identity.)

A group of people is less interesting than a single person. Someone like me is more interesting than someone unlike me. So, when listening to a story about change, I’ll be more engaged with a story about someone coming to terms with what the change is about, what it might mean day-to-day, what the chances are of being made redundant, how threatened they are at a personal level by the change, rather than a story about meeting stakeholder expectations, returns and principles for the future.

A clear problem
A story without a problem is just a portrait—and not engaging.

In Hollywood, they talk about ‘the inciting incident’—something that means that the setting of the story can no longer remain the same. In an organization, it might mean a takeover threat, a fundamental change in the market, but not “efficiencies”.

The inciting incident must matter to the audience (or at least it must obviously matter to the lead character). Without the impetus of good inciting incident, there is no momentum in the story—and the audience has no reason to care.

Tests and obstacles
One of the greatest flaws in most organizational stories is their sense of being sanitized. A good story proceeds from the problem through challenges and obstacles, making and resolving mistakes along the way. Most corporate stories go straight from problem to resolution in a straight line. The lack of mistakes and real obstacles (as opposed to obstacles that are automatically resolved by a new product we’ve just introduced) is what brands these as propaganda.

In most engaging stories, the obstacles increase in difficulty or complexity as the story goes on—increasing a sense of tension and risk. Interesting, engaging company stories tend to revolve on the “bet-the-company” decisions.

Robert McKee, the screenwriting guru, talks about story events as being meaningful chosen moments that illuminate the entire life of a character. The same applies to stories in organizations—they must be chosen moments that illuminate something deeper about the culture. In particular, a story reveals character in those chosen moments through the choices made by the lead protagonist—especially when they’re under stress.

So finally, a good story will feature a choice made in a moment of pressure—and that is when the reader learns about the real values of the character in the story.

References
G. Klein: Sources of Power. Cambridge: MIT Press 1999.

McKee, Robert; “Story”; Methuen 1999

D. Snowden and C. Kurtz: ‘The New Dynamics of Strategy: Sense-making in a Complex and Complicated World’, IBM Systems Journal, vol. 42, no. 3 (available through www.cognitive-edge.com).

;I. Shah: The Exploits of the Incomparable Mulla Nasruddin. London: Octagon Press 1985
;C. Heath and D. Heath: Made to Stick. New York: Random House 2007.
;H. Gardner: Changing Minds: the Art and Science of Changing Our Own and Other People’s Minds. Harvard, Mass.: Harvard Business School Press 2006.
;E. H. Schein: Organizational Culture and Leadership. Hoboken, NJ: Wiley 2004.

Nicholas Ind
Equilibrium Consulting, pb 5822 Majorstuen, 0308 Oslo, Norway
nind@equilibriumconsulting.com

PDF version

The argument of this paper is a simple one: creating value for customers is an organization-wide responsibility. This is a step removed from most approaches to the subject, which see marketing as an instrumental function and give emphasis to marketing as the primary, if not the sole, driver in building a brand. In this line of thinking, marketing is what marketers do to customers when they take what the company produces and re-present it. Yet marketing is not a department but a process by which the organization connects with the world around it. Also marketing theory and practice should not only be concerned with the external and marketing communications but also with the difficult internal reality of aligning the different parts of the organization.

When marketing only has limited organizational influence—when it is disconnected from other activities within the organization—the challenge of delivering a coherent offer is that much harder. Functional areas push in different directions and the appearance, functionality and presentation of the products begins to lack clarity. Alternatively, if marketing is connected with the rest of the organization; indeed if the whole organization is involved in delivering the brand, coherence is much easier to attain.

If this sounds theoretical, this scenario applies to an actual case: the launch of Apple Computer’s strategy based around the metaphor of a ‘digital hub for a digital lifestyle’. This metaphor, announced by Steve Jobs at Macworld 2001 in San Francisco, expressed a new vision for the brand and encompassed several new Apple products: new computers and integrated hardware for recording CDs and DVDs, iTunes and iMovie. Soon afterwards the metaphor heralded the launch of the iPod, Apple’s expansion into audio products and services and the introduction of Apple’s own retail stores.

At the time, Fortune magazine (November 12, 2001) was moved to compare Apple’s success with Intel’s problems: ‘Why in the world would Apple want to jump from the frying pan of the virtually profitless PC industry into the roaring fire of the hypercompetitive consumer electronics business? After all, just a few days before Apple’s splashy introduction of the iPod, Intel announced that it would close down its own disappointing consumer electronics division, which made, among other things, portable MP3 players, digital still cameras, kiddie videocameras, and a much ballyhooed digital microscope. For starters, the iPod fits right into Jobs’ so-called Digital Hub strategy for the Macintosh.’

The vision encapsulated in the strategic metaphor was not only was a driver for internal cohesion so that the organization could focus on those areas that best delivered the idea but it also became a widely used phrase by the media, such that each new service and product innovation launched by Apple was integrated into the metaphor. The whole process thus became a self-reinforcing circular movement that has enabled Apple to be consistently interesting and interestingly consistent.

One of the developments within marketing thinking that has tried to deal with the problem of marketing’s overtly external emphasis which too often leads to disconnected thinking, has been the emergence of the concept of ‘market orientation’. This approach extends the role of marketing by suggesting its role should be not only to sense movement in the environment but also to shape the organizational response by connecting with other business functions and departments. This indicates the role of marketers: to face simultaneously inwards and outwards and connect the organization and its audiences.

The principles of market orientation
Although the underlying ideas of market orientation have been around since the 1960s, it was two pairs of writers in 1990, who began to define and refine the concept: Narver and Slater¹ and Kohli and Jaworski.² Rather than simply focusing on the point of interaction with customers, they turned inward to explore how organizations could use customer knowledge to build organization-wide responses. Kohli and Jaworski saw the concept as referring to ‘the organization-wide generation of market intelligence, dissemination of the intelligence across departments, and organization wide responsiveness to it.’ Narver and Slater (1990) featured some similar elements, seeing market orientation as: (1) customer orientation; (2) competitor orientation; and (3) interfunctional coordination. However, Narver and Slater’s emphasis is on market orientation as organizational culture.

The virtue of market orientation is that it stresses the importance of connecting the organization together to deliver value to customers. It seeks to overcome the problem of siloization that is prevalent in organizations. Jaworski and Kohli in a 1993 paper addressed three specific questions: (1) why are some organizations more market-oriented than others?; (2) what effect does a market orientation have on employees and business performance?; (3) does the linkage between a market orientation and business performance depend on the environmental context? Based on two national samples the researchers came to the conclusion that market orientation is related to top-management emphasis, the risk aversion of top managers, interdepartmental conflict and connectedness, centralization and the reward system orientation. Moreover, a market orientation is related to overall business performance (but not market share), employees’ organizational commitment, and esprit de corps. And even more important, the connection between market orientation and performance appears to be consistent across environmental contexts that suffer from varying degrees of market turbulence, competitive intensity, and technological change. We might conclude from this that there are no environmental reasons to prevent market orientation and plenty of benefits.

Yet there is one area of market orientation that has been underplayed: implementation. A market-oriented culture is not only about interfunctional coordination or the type of organizational factors that enhance or impede the implementation of the business philosophy. Rather market orientation is a consequence (although it in turn reinforces) of a supportive organizational culture, HR and leadership. To develop this line of thinking we have developed the concept of participatory market orientation: a fusion of internal and external market orientations with an emphasis on realising the potential of market orientation.

Participatory Market Orientation (PMO)
A participatory market oriented philosophy aims to help the organization to become more participatory, such that it involves both its employees and customers actively in the process of brand development. This belief in the value of participation should steer the way investments are made in both internal and marketing activities and recognizes their connectivity. It suggests as a principle that rather than an over-reliance on traditional marketing communications to build a brand that funds are allocated to become entrained (synchronized) with customers and to integrate a relevant organizational response encompassing communications and actions.

An example of this entrainment process at work is the Grathak Katha (consumer’s voice) events held by the Bangladeshi mobile operator, GrameenPhone. GrameenPhone is the leading mobile telecom company in Bangladesh with a 48 per cent share of the market and 16·5 million customers (2007). This is a high growth market, but to take account of low incomes, GrameenPhone’s business model is designed to work with customers whose average spend on mobile telephony is $2 per month.

To better understand its customers and develop innovative ways of selling its services, the company conducts regular market research studies into the performance of its brand and particularly the delivery of customer service. However, in addition to this research, GrameenPhone has initiated a process for removing the distance between the company and its customers. This participative approach involves regular meetings between employees and customers in an environment that is both social and businesslike. The idea is to obtain direct interaction with customers both as a way of enhancing the reputation of the brand and as a means of learning about and learning with customers.

At the event itself, GrameenPhone matches the attendees one-to-one with employees so that there is the opportunity for personal dialogue. On these occasions research is conducted and results presented, new products are discussed and customers provide ideas on new opportunities. The idea is to mix the formal and the informal and such has been the momentum behind the process that music performances at the events are by groups that combine employees and customers playing together.

GrameenPhone has discovered that the quality of the feedback is high and the comments are genuine. Customers are not concerned with trying to either attack or please GrameenPhone, they just try to offer input and to relate their experiences. In one year the company conducted more than 300 events with over 200,000 participants. The key to maintaining the interest in the process both within GrameenPhone and externally with customers is the rapid processing of information, the actions taken as a result of input and the feedback provided.

Marketing Director, Rubaba Dowla Matin, argues that the success is due to the organizational capability to validate, categorize, analyse the data and to involve the relevant teams in the organization. It is these cross-functional customer management teams that play the vital role in determining the nature of the insight and generating action and communication. This investment into deep and direct insight and the willingness to encourage organization-wide participation have been the catalysts behind the success of the initiative and the company’s burgeoning reputation as an innovator.

Overall, when such external–internal investments as that made by GrameenPhone are managed effectively it increases its brand equity, which in turn enhances brand value. This final linkage is based on the premise that enhanced awareness and customer loyalty to the brand is the best indicator of the security of future cash flows. This way of thinking goes beyond market orientation because of its explicit link with brand value and because of the emphasis on engaging audiences to ensure that a market orientation leads to effective action.

Marketing’s role then shifts subtlety in this scenario. When the overall organizational goal is to enhance customer value there is a requirement for an organization-wide commitment to customers and a supportive culture, style of leadership, governance and human resources policies. Partly marketing must have an internal market orientation to help achieve this organization-wide perspective and partly it must be a key element in building bonds with customers and sharing knowledge about them inside the organization; externally sense-making and internally sense-sharing. This internal–external approach builds the brand.

The value of this twin perspective is endorsed by a study of Sweden’s 500 largest companies³ that shows organizations with the highest brand orientation index (BOI), where branding is the hub of operations, are characterized by an ability to combine both an internal and external focus. Interestingly, the profile of high brand-orientation companies is found in roughly the same frequency among business to business and business to consumer companies (50–50) and goods to services (57–43). This study reinforces the link between brand orientation and profitability, by demonstrating the correlation between the two with the group of leaders in terms of orientation showing operating profits almost double the lowest brand orientation group: ‘the most important outcome of this study is that we have been able to establish a clear link between brand orientation and profitability: the more brand-oriented a company is, the more profitable it is.’

In spite of the BOI research, most operationalizations of marketing ideas are developed around products and external markets. Yet it should be clear that a focus on human capital and on enhancing brand delivery capacity is of vital importance in delivering customer value in both products and services.

In recognizing the importance of human capital and internal market orientation, it is clear that external market orientation must be kept in focus. It may be important to ensure that employees are truly engaged, but it must be remembered that the value of this engagement is in the delivery of value to customers. Thus the marketing department should cooperate with the HR department in developing the brand, while it should also work at being finance-orientated to improve understanding of the connection between investments in marketing activities and financial performance. Equally, responses to events, such as a change in competitor activity, a move in market share or new patterns of customer behaviour all require the organization to work in an integrated way across internal boundaries. The ability to do this effectively requires a participatory market orientation (an outside-in, inside-out way of thinking). This is something that the organizational culture has to encourage and that leadership must demonstrate by its communications and actions. Something the BOI study endorses with its (not surprising) discovery that in the most brand-oriented companies, the executive management group is very active in brand-related activity.

Notes
1. J. Narver and S. Slater: ‘The Effect of a Market Orientation on Business Profitability’, Journal of Marketing, vol. 54, no. 5, October 1990, pp. 20–35.
2. A. K. Kohli and B. J. Jaworski: ‘Market Orientation: The Construct, Research Propositions, and Managerial Implications’, Journal of Marketing, vol. 54, no. 2, April 1990, pp. 1–18.
3. Brand Orientation Index: a research project on brand orientation and profitability in Sweden’s 500 largest companies. Label AB in cooperation with Frans Melin, 2005.

Adapted from N. Ind and R. Bjerke: Branding Governance. Hoboken, NJ: Wiley 2007.

Sicco van Gelder
Placebrands
sicco@placebrands.net

Microsoft Word version

1. Introduction
Place branding (for countries, regions and cities) is a relatively new discipline and inevitably people have many questions about it. One important question is how to successfully brand a place. This question actually consists of a number of discrete questions, namely whether:

• Branding is more suitable for some places than for others?
• There are pre-existing factors that increase the likelihood of successful place branding?
• There are factors that improve the success-rate of the brand development process?
• It is possible to predict the success of a place brand strategy?

This paper tries to answer each of these questions by describing the criteria and factors that contribute to successful place branding. By assessing the place, the players and the plans they make, it is possible to predict the likely success of a place branding initiative.

2. Should all places brand themselves?
There is a debate whether all places should be actively branding themselves or that the method is more appropriate to some places than to others. There is a perception that places facing some sort of crisis are more likely candidates than places with stable economic, social and cultural settings.

Although a place that faces a crisis may become acutely aware of the weaknesses of its brand and decide that it is high time to do something about it, there is little evidence to suggest that crises in themselves are a reason to brand a place. This is due to two factors, namely:

• brands are not built (and seldom even destroyed) in a day. Place branding is certainly a long-term endeavour and requires years of consistent and persistent actions for the brand to take shape;
• branding will not help solve the crisis simply because only decisive and targeted actions will do so. The brand will however, provide the context for solving the crises and the brand’s strengths should be applied to the solution. A strong brand will also help to mitigate the effects of a crisis as the crisis will not be (one of) its only claim(s) to fame.

If it’s not places that face immediate calamity, catastrophe or disaster, then which places can most usefully apply branding? Certainly, some kinds of places are more likely candidates for place branding. These include:

• places that face intense and increasing competition. These places are obvious candidates because they need to sharpen their competitive edge to retain or improve their positions. This is currently happening in southern Africa, where the rise of South Africa is putting pressure on the neighbours. In Europe, competition between major cities has increased over the past decade and a place such as Amsterdam finds itself competing with Madrid and Barcelona for visitors, investors, talent and events. Similarly in Asia, Hong Kong is facing more intense competition from the likes of Shanghai and Singapore;
• places that face complex development tasks, such as areas of urban expansion, regeneration and transformation. These places need to have a very strong sense of what they wish to become, what they will offer and how they will function, which is what branding can offer them. Examples are mixed-use waterfront developments that dot the cityscapes around the world: Hamburg, Toronto, Lyon, Melbourne and the like;
• places that face a slow and steady decline. Such places often lose businesses, inhabitants, institutions and events at a pace that doesn’t start the alarm bells ringing until the scale of the problem becomes acutely apparent. These places have the opportunity to stop and even reverse their slide if they act in a concerted effort to shore up their brand. Examples are Southampton in southern England and Cleveland, Ohio in the USA;
• places that have lived through a crisis and need to reinvent themselves. These places have had a major crisis that has completely altered the economic, social and (sometimes) cultural structures. There is no opportunity to reverse the situation and the only thing left is to completely rethink the brand. One of the most obvious examples is Bilbao in Spain that has reinvented itself as a tourist destination after the collapse of its manufacturing base. Other examples of places needing to reinvent themselves are Belfast and Detroit.

3. The likelihood of successful place branding
Not only is there discussion about which places should develop their brand strategies, there is also debate about what preconditions improve the likelihood of success. We find that having the following characteristics contribute to a place’s ability to brand itself:

• unity: the key stakeholders of the place need to agree to come together to shape its future by developing and implementing a brand strategy. This is not a given in most places. Stakeholders have seldom sat together to discuss their shared future and to determine how their views on the subject coincide and differ. And in even fewer places have stakeholders actually decided to act to jointly shape that future. We’ve worked in places where bringing together the stakeholders and getting them to work together was the hardest task of all;
• diversity: places that are more economically, socially, culturally and naturally diverse stand a better chance of developing a strong and effective brand. This is due to the fact that place branding is not an exercise in reduction, but rather one of adding or enhancing layers of richness. Diversity gives such places like Vancouver, Kuala Lumpur and Cape Town their attractive edge;
• initiative: places whose stakeholders already (jointly) undertake (marketing) initiatives. These provide necessary experiences beneficial to the place brand development efforts. This is due to the fact that they have already accepted the need for changes and are taking actions to bring them about;
• experimentation: there also needs to be a willingness to take risks and a certain tolerance towards failure of experiments. Often, accepted ways of working are entrenched and people stick by what they know. Risk aversion is often prominent in some of the large (and bureaucratic) organizations that are key stakeholders of many places.

4. What is required to successfully develop a place brand?
Not only are there existing factors that improve the likelihood of success for place branding. More importantly, there are factors that influence the success of the brand development exercise itself. These are:

• partnership and leadership: a place brand can only successfully be developed and implemented by the key stakeholders of the place. It is not a task to be left to the government alone. The organizations that can shape the future of the place through their actions, investments and communications should come together in partnership and should demonstrate shared leadership in the development and implementation of the place brand strategy. In lots of places, government departments have been tasked to brand and market their city, region or country and the results are mixed at best;
• vision and strategy: the first thing the brand partners need to do is to share and compare their views on the future of the place and make sure that they develop a shared vision of a greater magnitude than the sum of their individual visions. Existing visions often are highly sector-related (in one case we found 23 visions for the same city) and do not rise above the commonplace of a great place to live, with the best possible healthcare and education and jobs for everyone. Once they have agreed a shared vision, the partners need to map out a strategy for the brand of their place that they can jointly deliver;
• appraisal and creativity: the brand partners need to be realistic and understand what has shaped the brand of their place so far, and what has worked in the past and what has not. That should, however, not preclude them from finding new ways of doing things, from developing original ideas and from creating innovations for their place;
• “on brand” implementation: finally, the partners need to involve other stakeholders in realising the brand through actions, investments, attraction programmes and events that demonstrate the brand in action.

There is an immense task here of managing the stakeholders and their activities and communications to ensure that agreed initiatives are carried out, consistently and “on brand”. The brand partners must, therefore, decide how best top organise this task to ensure effective implementation of their plans.

5. When is a place brand a success?
Finally, there is the question of when a place brand strategy can be considered to be successful. In other words, what should the place brand embody of to become successful?

• value and purpose: the brand is a promise of value and one that needs to be kept. The more valuable the place brand is to its key audiences, the more likely they will be swayed by it. The brand also provides a sense of purpose to the place’s stakeholders, as it embodies the things they want to achieve. The stronger this sense of purpose, the more likely that stakeholders will pull together and deliver. Too often the brand of a place does not provide a common purpose, but only a trite slogan: City of Lights (Anchorage), the Friendly City (Orange Country), Get in on It (Baltimore), Every Day Is an Opening Day (Atlanta) and It’s Cooler Here (Edmonton);
• truth: the brand needs to reflect the reality of the place. Place brands are largely built on people’s experiences of the place, on recommendations by trusted endorsers, and on what goes on in the place. Any dissonance between the brand’s promise and these realities harms the place brand’s equity. The experience of the rough immigration treatment meted out to visitors harm the brand of the USA. The scenes of the scores of itinerant labourers sleeping on the streets of Mumbai can come as a shock to a first-time visitor to ‘The Fastest Growing Free Market Democracy’;
• inclusive and for the common good: the brand must appeal to the local community and must provide it with tangible and intangible benefits. Only if the place’s brand is embraced by its population, businesses and institutions will it also be credible to outsiders. In Bangalore local pride groups conflict with what are seen as the “outsiders” of the city’s booming IT industry. In a bid to appease these activists, the city government decided to change the official name of the city to Bengaluru, which is the local pronunciation and the city’s IT companies have started to fly the local flag. Neither move will do much unless the Kannada population of the city feel that they have a stake in the city’s future;
• creativity and innovation: the brand must help to encourage and release the resourcefulness and inventiveness of the stakeholders in their quest for realizing the place brand strategy. The brand should promote new ways of working, investing and communicating and advance new and original ideas, products and services. Newcastle-Gateshead kicked off a flurry of creative activity with the Angel of the North, a huge steel statue along the motorway, and followed this up with the distinct Millennium Bridge, the Baltic Centre for Contemporary Arts and the Sage Concert Hall. All a far cry from its drab and dreary post-industrial past;
• complexity and simplicity: the brand of a place needs to reflect its richness and not try to reduce it to a single utterance or representation. However, at the same time, the core of the brand must be straightforward enough for people to grasp its value easily. Italy stands for style, France for romance and Japan for perfection, but we also know that these places have a lot more to offer that makes them distinctively attractive;
• connectivity: the brand must help to connect up people, businesses and institutions inside as well as outside the place. A brand that allows and encourages people to rally around it stands a far better chance of being successful. In some cases, making use its diasporas’ relationships with the home country help to fan the brand’s flames. Cases in point are Ireland, India and China;
• validity: a brand must remain relevant to its stakeholders and audiences over a long period and it can only do so by delivering consistent value to them. This does not mean that the brand should remain unchanged. The world changes and so do people’s wishes and expectations, the competition (and what they have to offer), and economic, social and cultural developments. It is important to regularly check and preserve the soundness of the brand over time and to take appropriate actions for it to retain its significance.

6. Risks and rewards
Place branding is an intricate activity and chances of doing it successfully rest on a proper understanding of the factors that influence the outcomes. Without understanding the risks involved and how to reduce these to a manageable level, success is unlikely and subsequent failure will simply prove what the (inevitable) critics have said all along: ‘It’s a waste of money that could have been better spent on health, education, housing, infrastructure, etc.’ But if there are possible risks, there are also potential rewards to successful place branding, such as:

• improved and sustainable competitiveness, e.g. for attention, investments, jobs, inhabitants, institutions, visitors and events;
• higher returns on investment, e.g. in real estate, infrastructure, promotions and events;
• coherent development of the place as physical, social, economic and cultural planning join up to realize the brand’s promise;
• pride in the place, as the population, businesses and institutions experience its (renewed) sense of purpose and direction;
• unsolicited praise, approval and endorsement from media, celebrities and (international) institutions;
• increased word-of-mouth among (foreign) target audiences as personal experiences and a wish to be associated with the place create a buzz.

Ian Ryder
British Computer Society
ian.ryder@gmail.com

No brain-food—just a sector anecdote!
The same rules apply: we all know that “rules is rules”, right? Could we try a maybe?!

I recently (nine months ago) took a new position working in a professional body, one of the largest of its kind in the world, which also happens to be a registered charity and incorporated under a Royal Charter. After a lifetime in the corporate world I can tell you: the rules are different! Not the fundamentals of brand strategy, clearly, but the processes and procedures of development and execution.

Perhaps a few words of explanation about ‘Royal Charter’ are needed, because this means little or nothing to anyone outside UK shores.

The only bodies that can award a ‘Chartered’-status professional qualification are those that have been granted a Royal Charter by HM the Queen. Whilst it is a major honour, this has huge implications if you find you want to do anything significant on branding. There are two main issues and several supplementaries.

First, chartered organizations have a governance structure that requires a Trustee Board (TB) to have oversight and ultimate responsibility for performance. This usually comprises volunteers who are part-time, unpaid, and can come from absolutely any walk of life and any professional background. The TB then delegates authority to a CEO and Executive Board who are responsible for the operational execution of the organization’s strategy (and sometimes they don’t!).

Secondly, any change to the organization’s range of activities or, critically, name, must be approved by what is called the Privy Council—essentially a sign off by HM the Queen.

The “supplementaries” include a range of things related to this governance, involving many stake-holders, members included, who feel they can have a say in this and, therefore, not surprisingly there exists the potential for major disagreements between a part-time TB and the full-time team of professionals and EB who, probably rightly, usually believe that they are best qualified to make such key decisions. One of the biggest pains of all, though, are timing and process.

Often a TB will only sit six times a year and, even then, really substantive issues will have trouble finding agenda time. But it can take a staggering 12–18 months just to get approval for a name change and corporate rebrand, which includes the need for a member-approved motion at an Annual General Meeting followed by a Privy Council seal of approval—not guaranteed, and they only meet twice a year!

This is not to say that such organizations are not fun to work in and with, or that they don’t share many of the same brand challenges as their arguably more fortunate commercial brethren, with only “normal” governance and market forces to manage. All the issues of needing to generate commercial revenues in a competitive market-place in a service business still apply. This means all our much-loved challenges of positioning, product development and management, customer service management and indeed brand and marketing strategy development and execution, in the broadest sense, still apply.

The key challenge is that, if you thought your only issue was to convince your CEO and fellow board members who are likely to have both familiarity with marketing principles and have the final decision, then consider the need to first do that, then take it through the process described above. This is where there is a very good chance the majority of your TB–member agreement has to come from people who may never have even heard of the word brand and if they have, it is guaranteed it was in the wrong context and with such limited knowledge that they won’t understand what you are proposing or why.

Rather than this be just a simple “ramble” about how lucky profit-making commercial organizations are—even those B2B companies that still have far too many “critical but knowledge-challenged” individuals—I thought maybe I’d drop in a brief summary of tips for anyone working in, or agencies considering pitching for, this kind of organization.

1. Get a really detailed understanding of the fundamental governance constraints, together with a timetable of key Committee, Council and Board meetings.

2. Understand the background of Trustees so you can see the scale of your challenge, or the extent of your support.

3. Have a very clear plan and timeline, always important but critical in this case.

4. Creating a small sub-group of three or four from the TB to take with you on the journey will make the final TB sign-off so much easier—it may even be passed!

5. Learn to manage uncertainty and develop your proposals and arguments carefully—and make sure you do this a long time ahead!

6. Exercise enormous quantities of patience.

7. Whichever god you believe in—ask for help!

We’re on our journey though, having developed a new marketing strategy alongside the slower development of our brand strategy using a variant of a process model I’ve used before, this time facilitated by one of the really good, smaller brand consultancies, UffindellWest.¹ We will get there, and I look forward to writing up that journey as a case study sometime during 2010.

Note
1. The CEO and owner of which is one of our own Medinge members.

Patrick Harris
thoughtengine
patrick@thoughtengine.co.uk

PDF version

Abstract
This paper considers the importance of employees in the process of building customer experience. The paper states that internal investment is rewarded with consistent, quality customer exchanges. Emphasis is first placed on the positioning of brand management within an organization, and its linkage to strategy. Second, the tools of identity and guiding principles are introduced. These tools are used to activate staff by inviting their engagement and by asking them to review the brand from a personal perspective. Identity encourages employees to interpret corporate identity and apply it to their unique situation and skill set. Guiding principles serve as a platform to nurture desired behaviours in the organization. Together, these two tools better prepare staff to respond to customers. Brand values are presented as the currency to measure the worth of exchanges between organizations and their customers. The paper concludes by presenting a case study of the mobile operator, Orange, during the period 1994–2003.

Introduction
Branding is about people. People build brands. People buy brands. The relationship, at first glance, is a simple one—build a good brand and others will buy it. At the heart of this relationship, however, is another group of people, that of the employees. It is the employees who enact the attributes of the brand and whose actions ultimately foster customer experience—whether good or bad. Staff actions should reinforce the promises a brand makes to its customers. If wisely conducted, this reinforcement breeds more success in terms of sales, awareness and loyalty. Employees have the formidable task of demonstrating the brand by the actions they take. The adage actions speak louder than words is a truth that holds firm in the process of building successful brands.

However, many organizations fall short of representing the brands they espouse. Sometimes, this disconnection is due to uncommon circumstances. These include sudden market shifts that are external to the organization. Internal changes—like the loss of a key figurehead or an organizational merger—are also examples where a disconnection, between the brand attributes and employee actions, can be present. These examples, and others like them, provide resilience tests for brands. The question is, can effective internal brand management help to overcome these difficult periods? Further, can an ongoing internal brand management process help to preserve a healthy relationship between employee actions and customer experiences?

This paper discusses the importance of inward facing brand management. Emphasis is given to the positioning of brand management and its relationship to organizational strategy. Separately, the tools of Identity and Guiding Principles are presented as a means of serving the employee effort to enact the brand attributes. Finally, a case study involving the mobile telephone company, Orange, is introduced for illustrative review.

1. An inward perspective
It was in his seminal paper of 1937, that Ronald Coase prescribed the basic reasoning of a firm.¹ He described the importance of building and maintaining relationships as the very essence of a firm:

A firm, therefore, consists of the system of relationships which comes into existence when the direction of resources is dependent on an entrepreneur.

If consistency of brand experience is sought, this definition suggests the need for a balanced focus of nurturing and serving internal and external relationships. Yet in many brand management efforts, resources are usually dedicated to constructing an outward image of the brand. Advertising, packaging and sponsorship are traditional examples. It is commonly accepted that internal characteristics are transferred to the external environment via the employees of the organization. Further, this transferral may be unintended if left unchecked. This point implies a need to manage, or at least positively influence, the identity that is transferred outwardly—in order to maintain consistency and overall control. Thus, the internal workings of a firm should form an integral part of brand management. Brands today must represent a company’s history, future vision and its outward appearance—as well as the internal representation of the organization. Why then do organizations give little attention to internal brand management?

1.1 The right level
Inward-facing brand management must be considered at the appropriate level if it is to succeed. Brand management when considered as a periphery exercise of a marketing subset, is destined to perform poorly. Brand today is a key element of every transaction the organization engages in and as such should be strategically incorporated into internal activities. Brands do far more than label products or companies. Brands today can:

• change market dynamics;
• span across entire markets and enter new markets; and
• heavily influence industry business models.

Google, Amazon and Napster are examples of brands that have significantly changed the dynamics of entire markets. Virgin, Marlboro and Caterpillar are good illustrations of brands that can span industries or enter new industries. Finally, MySpace and Blackberry are brands of influence that have stimulated enormous changes to business models in their respective markets.

Despite this shift in the influence of brands, intelligent dialogue between brand mangers and the strategic elements of the firm is often lacking. In reality, management of the brand must feature in all that the company undertakes, internally and externally. Brand must be prevalent in strategy, training, objective-setting, working style, facilities and much more. Ind, when discussing the concept of living the brand, argues that brands come to life when internal and external boundaries are blurred.² Most importantly, brand management must also be well integrated into the activities of the organization if it is to deliver quality customer experiences.

But the phrase living the brand does not necessarily express the integration of brand at a strategic level of the organization. Organizations that unite strategy and brand possess cohesive workforces that demonstrate sound direction, incorporate a recognizable approach and present a high quality, consistent customer experience. Ind’s phrase can be extended for organizations that provide a strategic and integrated focus of brand management—being the strategy and living the brand.

1.2 What they do, not what they say
Internal branding should concentrate more on context rather than content. It should focus on why an activity occurs, more than the brand compliance of the activity itself.

A hypothetical example of branding the company canteen is helpful as an illustration. In this circumstance, it is not the branded colour of the crockery or the ability to reinforce company messages on the walls that is critical. Rather, emphasis should be on the behaviours exhibited when serving or receiving food, and on the atmosphere that is conveyed by staff. Behaviours are visible evidence of the brand’s capacity to influence. Too often it is the focus on tangible items that get the bulk of the attention—ensuring that the content meets stringent brand guidelines—while overlooking the contextual settings and behaviours of the people involved.

The relationship between employees and customers is—or at least should be—genuine, two-way and sincere. What is displayed externally is chiefly a reflection of the activities of he internal organization. For this reason, inward brand management should not be limited to providing training material for customer-facing staff only. Instead it should be the creed by which the whole organization elects to live and breathe. Internal activities should always underpin the customer experience sought. Thus, brand management efforts must be focused inside the organization as much as, and possibly more than, they are externally. The key is to provide staff with appropriate tools, allowing them to be the strategy and live the brand.

2. Identity: building understanding
Corporate identity, the persona of an organization, is widely used by companies and agencies alike. It is normally expressed in a hierarchical set of descriptive terms—from, say, vision to values—and provides guidelines for how the organization expresses itself. Corporate identity is a valuable asset of any brand manager’s toolkit.

Corporate identity is not necessarily the best tool for employees, however. A workforce is after all, a collection of people and often, a corporate identity does not adequately speak to each as an individual. Further, individuals see organizational change and shifts in corporate identity as uncomfortable and difficult to accept. Employees take these shifts personally and feel lost when another directive arrives, with a new focus, and the CEO asks for their buy-in—once again.

2.1 Activate, not automate
Inside organizations, it is not buy-in that is necessary, but momentum. Buy-in is a flawed concept that suggests 100 per cent effectiveness in the communication of an idea, 100 per cent belief in it by the listener and 100 per cent efficiency in enacting it. Momentum, however, is created by communicating the gist of an idea and afterwards, encouraging individuals to interpret it, apply it to their unique situation and then use their individual skills to address it. Momentum taps into the collective wisdom of the staff and invites their participation. Here identity is still in use, but it is not an induced corporate identity communicated from the upper echelons of the company. Instead, individual identity is developed by regularly encouraging employees to interact with the company position. This allows them to reach a greater appreciation of its meaning to them personally, or as smaller teams of people. This is how it should be. Identity, used as a tool, allows individuals to increase their overall understanding of the organization and to personally ingest its meaning. Workshops, training programmes and promotion of good dialogue are good methods to achieve this aim.

There are several benefits of the process of engendering identity. First, employees have a stronger personal sense of organizational purpose. They know what to do and why they should do it. Secondly, they are less affected by significant organizational changes that (inevitably) will occur. They take these changes less personally. Thirdly, they are better equipped to see how their role can make a difference to the company as a whole. Fourthly, a company-wide spirit of involvement and responsibility is in action. Overall, their understanding is more consistent through change and this consistency features readily in their work. They can, in effect, be the strategy.

The next step is to help staff to underpin their understanding with appropriate behaviours.

3. Guiding Principles: nurturing desired behaviour
Consistent behaviour cannot be prescribed, nor can cultures be assigned. Cultures are more amorphous than this. Consistent behaviour can be nurtured, however. By nurturing a few desired behaviours, a sought-after organizational culture is more likely to develop. This focus is served well by the concept of Guiding Principles.

Guiding Principles are not rules, because rules are typically prescriptive and describe what can and cannot be done. They are not objectives, either, as guiding principles are interpretable. They possess a high degree of flexibility, while objectives should always adhere to the SMART rule of thumb.³ Finally, guiding principles are not habits, as habits are traditionally out-of-date or unchecked actions that are routinely applied.

Instead, Guiding Principles are a small collection of memorable expressions of behaviour—about three to six in total. They describe behaviour that must be present in order to fulfil strategic and brand aims. Interestingly, guiding principles are useful regardless of changes in circumstances.

Thus, even in times of instability, guiding principles represent the inherent behaviour that individuals can turn to and depend on. Together, they underpin an organizational identity and are necessary to nurture a desired culture. A good example is the following: Everything in moderation, nothing in excess.

This phrase, when applied across a number of individuals, can have different interpretations. To some the phrase indicates the need for a steady, even approach. To others, it might mean that an extreme intake or exposure is acceptable—on occasion, but not regularly. In all cases, individuals will be able to respond in a manner that is in keeping with the desired behaviour, but which suits their situation.

Consider, too, the guiding principle of face to face. To customer-facing staff, its meaning might be very clear: be with the customer whenever possible. To back-room staff, however, it might have usefulness in terms of how they treat email or how feedback is provided to colleagues.

The power of Guiding Principles is that they can be communicated in a straightforward manner, yet their meaning is always personal to each individual and open to interpretation.

The combination of identity and guiding principles is a mobilizing force for organizations. Together, they help to form employee behaviour and to channel employee actions and decisions in desired directions. As a result, the organization becomes more adaptable in terms of the changes it faces, yet will be consistent in its response. Meanwhile, employees are made more aware of the aims of the organization and are actively engaged in delivering its success. They are able to live the brand.

3.1 A cautionary tale
Guiding Principles, together with identity, should hold meaning for the individuals who use them. This is best achieved by allowing a significant cross-section of the organization to develop them. It is not always possible that one set of guiding principles will serve the whole organization and some limited regional or team variation should be encouraged. The process should be highly integrated and inclusive.

However, the commitment to involve staff must be genuine and purposeful. It must be supported by the presence and involvement of senior managers. Employees do notice when they are being served a placebo process. Less-than-genuine attempts to involve staff can result in far fewer committed people than desired—perhaps even an employee revolt. Having a few members of staff involved is a far cry from having an entire workforce mobilized and committed to the cause. Martina Navratilova expressed it fittingly when she described the dedication required to achieve sporting excellence: ‘It’s like ham and eggs. The chicken is involved, the pig is committed.’

4. Where is the customer?
Thus far, this paper has concentrated most of the discussion on the organization itself—not the customer. This is deliberate because it:

• illustrates the yawning gap in internal focus;
• establishes an appropriate sequence of events required; and
• demonstrates the amount of effort that is necessary, in order to deliver desired customer experience.

This in-depth focus on internal matters provides two key brand management deliverables. First, it builds a robust foundation for stimulating desired internal attitudes. These, in turn, become products and services that deliver a valued customer experience. Secondly, undertaking exercises of understanding and behaviour ensures that downstream activities become easier to address and are implemented with greater consistency.

As the mantra suggests, the customer is always right. An inward facing brand process, however, better prepares the organization to respond to customers in the right way.

5. Genuineness and transparency—ready to face the world
In today’s market-place, it is important that any presentation made to a customer needs to be wholly genuine. Further, the organization that delivers the product or service needs to be transparent. This need for genuineness and transparency does not stem from brand management manuals. Rather, this is a necessary organizational response to today’s consumers, who are armed with choices, control and the tribal nature of communities.

5.1 Choices, control and community
In recent times, consumers have gained access to new and powerful tools. In the main, these consumer tools refer to new communication technologies such as the internet, mobile telephony and peer-to-peer connectivity. Less hyped, enabling technologies such as increasing digital storage capacities (i.e. the ability to access, store and transfer large volumes of information) are also critical consumer tools.

While each of these technologies no longer represents stirring news on their own, none of them should be underestimated in terms of the lasting social change that they are introducing. They have the capacity to leapfrog technology generations, connect previously isolated areas, enable the connected portion of the planet to communicate and they provide access to an ever-increasing sea of information.

In brand management terms, these tools have created a state of caveat venditor, where markets provide near limitless choices and the consumer is able to control the exchange. If the company cannot respond, a raft of alternatives is just a mouse click away.

Of particular concern for brand managers is that traditional systems of trust and relationship building are changing at alarming rates. The current generation is the first to be exposed to an endless landscape of sources of trust and the ability to bypass middlemen. As recent as the late 1980s, for example, there were only a few widely acceptable sources of news. Now, news is available from numerous providers, aggregators and commentators—whether in the form of traditional institutions, blogs or others. Indeed, many consumers of news have also become commentators and publishers in their own right.

5.2 A gathering storm
In strategic and brand terms, this means that segments of customers can band together—practically overnight—and shift organizational decisions, in a way that has never been possible before. A few activists can cause years of unwelcome press and lasting grief with court cases against organizations like McDonald’s.⁴ Brand reputations can suffer from reported employment practices in manufacturing assembly plants.⁵ During the construction of this paper, vegetarians united to protest a decision by Masterfoods—makers of Mars and Twix chocolate bars—to use animal rennet in some of its products. The result? Masterfoods publicly admitted that it had made a mistake and reversed the decision.⁶ It is now reported that they are reviewing the broader product range with the diets of vegetarians in mind.⁷

Finally, an illustration involving Apple’s customer base shows the variety of involvement by informal customer tribes over time. From its inception, Apple has attracted an enormously loyal customer base. This was true even during Apple’s lethargic progress in the 1980s.^{8, 9} In those dark days, lore has it that some near fanatical customers even loitered in computer stores to promote Apple products to would-be buyers. Surely this was a welcome if not unexpected asset for Apple at the time.

However, in recent times, that same loyal base has applied pressure to Apple itself—with expert leadership from Greenpeace—to improve Apple’s eco-friendly practices.¹⁰ The success of this orchestrated campaign makes the clear point that no brand can ignore the mobilized wishes of its customer base; particularly a famously loyal one.

The need for transparency and genuineness is not a marketing tool or branding fad. It is not a management theory for organizational development. It is an irreversible fact of business life that every organization must learn to address. This need will only increase as consumer tools improve and as more people have access to them.

Brands can no longer state unrealistic statements of aspiration. The truth is that they never should have done so. Now brands, or at least those that aspire to build valued customer experiences, can only state what the organization can realistically live up to. This requires learning for some, as it is not necessarily the marketing mix that brand managers learned from the era of Madison Avenue thinking.

6. Values—the customer connection
Brand values are one of the more familiar terms used by businesses and brand managers. Brand values are familiar, too, for many customers. This is justifiable, as values are tangible brand management tools to be shared with customers. Organizations should openly state their values and ensure that they are represented in their activities. Simultaneously, customers are able to use the values as benchmarks to evaluate the success of their exchanges with the organization.

Brand values are more resident in the customer domain than identity and guiding principles, discussed previously. Identity and guiding principles are the strategy in flexible form, and help the employees to be the strategy and live the brand. In contrast, brand values are the currency of customer experiences. Each experience can be considered as positive or negative, in a brand sense. Where the brand values are present in a customer exchange and supported by the actions of staff encountered, the transaction can be considered a positive one. In these positive exchanges, the brand is reinforced and the relationship deepens as a result. In contrast, negative transactions occur when the brand values are not evident in the transaction. Here, the customer completes a transaction (or aborts it) but has a less clear understanding of the brand and its position.

Brand-based organizations would do well to treat these measures of brand values as importantly as they do other measures of success. This is because the degree to which brand values are communicated is directly related to how much the consumers buy into the actions of the company and its longer-term perspective.

7. Putting it all together—a case study
The mobile telephone company, Orange, provides an excellent case study for review. Orange was a fast growing, brand-based and industry-in?uencing organization, particularly in the mercurial heyday of 1994–2003. It was the last of four players to launch in the crowded UK market and was heavily dependent on a differentiated position. From this unlikely position, Orange proceeded to excel at providing excellent customer experiences.¹¹

Like many organizations, however, Orange also faced a number of operational issues, internally and externally. Some examples included dealing with interdepartmental rivalries, supplier inconsistencies, overcoming the communication needs of a large employee base and management and staff mismatches at various levels. Again, these are common issues that many organizations face. Orange, however, was able to regularly overcome these issues, or at least manage them, by demonstrating its strong sense of organizational purpose and by encouraging employee engagement with the brand. The brand values were thoroughly incorporated into the entire organization—product development meetings, personal development, employee achievement citations and much more.

During the period mentioned above, a strong sense of understanding and awareness existed in the organization. It would not have been out of place for a highly technical meeting on telecommunications platforms and infrastructure to close with a discussion on how to make the chosen concept look and feel Orange. Further, the senior team, and in particular the CEO, regularly and personally conducted visible deeds that reinforced the values. These deeds were visible to the organization and were passionately recounted, until they became symbols of the organizational identity. They developed into rich seams of company lore that were ardently repeated.

Below are two examples from the period which illustrate:

• one employee’s personal interpretation and application of brand values; and
• how senior management deeds can build lasting, purposeful narrative.

7.1 Doohickey Day
Many technology companies face a challenge in getting the marketing team to understand the technology team and vice versa. Communications between the two groups can become sterile, even where best intentions are present, normally due to a lack of understanding between the two groups. Orange was no exception. A unique solution for Orange was developed, however, by one of its engineers. He created a forum for sharing technical developments in an engaging format, which the marketing team would appreciate. The concept was called Doohickey Day, named for the way that engineers in the Dilbert cartoon strip sometimes convey key technologies to their colleagues.

The forum consisted of engineers who would present innovative and upcoming technological concepts to a crowd of (largely) marketing people. The attendees all sat at round tables, each with a large red button in the centre. Each button played a unique sound when pressed. When speaking, the technology presenters were not allowed to use acronyms or jargon to describe the concept. If this did occur, the attendees could “buzz” the speaker by pressing the red button. At the end of the day, the speaker who had the most buzzes against him was given a penance. The penance? They were made to work in the marketing department for a day!

This process tackled an age-old issue of inter-department communication, but did so in a way that was engaging. In fact, the whole exercise was straightforward, refreshing, dynamic, honest and friendly—reinforcing the ?ve espoused Orange values.¹² Most importantly, the concept was created out of an employee’s personal understanding of how the brand values could be applied to solve an internal issue. It is just one of the many ways that an internal brand management focus helped to signi?cantly in?uence the workings of the organization and ultimately, the services that were developed for customers.

7.2 Customers missing in the boardroom
A second example focuses on just one visible senior management deed that carried particular resonance throughout the organization. It involved two members of the Corporate Strategy team, who were tasked with presenting a concept to the Executive Board. While presenting the early portion of a PowerPoint presentation, the CEO, Hans Snook, thanked the two strategy representatives for their effort and asked them to leave. The presenters quickly pointed out that they were not finished and that they still had more pages to discuss. Mr Snook replied that given that they had already presented a number of pages and that they had not yet mentioned the customer, they were indeed, finished. The embarrassed presenters duly left the now silent boardroom.

The impact of this brief episode was immediate and far-reaching. First, it concentrated the minds of the strategy team for that particular presentation and for every subsequent piece of work undertaken. Second, the board members too took away additional insight that day into how the CEO was absolutely determined to represent the customer at all costs.¹³ Finally, stories about that day meandered throughout the organization, establishing a firm body of lore about the importance of remembering the customer and it served as a constant reminder to the whole of the company.

7.3 Talent-spotting
Readers might see these two examples and look for the role of the brand manager in both, for neither example is a result of a brand-led, marketing initiative. One example cited the insight of a single employee and the other referenced the strong personality of the CEO. Nevertheless, the role of brand managers is still key in both. The stories show the underlying need for brand managers to recognize when brand values are being enacted and to support and endorse these activities. Eventually, support from brand managers with regard to Doohickey Day, helped it to grow from a small gathering of people to a highly engaging exchange for hundreds of attendees. Separately, brand managers religiously built the CEO’s insistence of putting the customer first in every communication exercise.

Brand management in these instances did not translate into the clever invention and leadership of a specific project. Actually, it required the wisdom to locate good values-based examples when they occurred and the dedication to support them thereafter.

7.4 Bene?t for the customer
The Orange example is also beneficial for seeing how the brand values were reiterated externally, in customer exchanges.

From the outset, Orange presented an interesting proposition that people wanted to be a part of. At launch, in 1994 for instance, no product-specific materials were used. Instead a broad brand-awareness campaign was built, in an industry that was woefully lacking in powerful consumer brands. It hinged on the phrase the future’s bright, the future’s Orange, a phrase that is still immensely popular today and which is politely modified with wordplay in media coverage. Below are some examples of how Orange reinforced the five brand values, particularly in circumstances of customer experience.

7.4.1 Friendly and straightforward
The values of friendly and straightforward were in widespread use at all Orange touchpoints. Innovative solutions at that time are now readily recognized as industry standards. These included uncluttered shop environments, a reduced number of simplified talk plans and the absence of technology in all advertising. Customers readily bought into a lifestyle concept instead of making independent, product-based, purchasing decisions. Presentation material relied on brief, but clear phraseology and powerful, supportive images. This approach was in complete contrast to an industry that was technologically oriented and rife with complex explanations. Philosophically, the friendly perspective was internally viewed as a child leading an adult into a safe and rewarding future. Thus, advertising often used children’s concepts such as bicycles and kites, or simple line drawings to explain services.

But even the name Orange, while highly respected today, was seen as innovative and unusual. Practically every operator name at that time featured some aspect of mobile telephony—words like phone, net or cell—and thus, emphasized technology. A few company names existed outside the technology sphere, but the companies failed to market themselves in a non-technological way. Today this use of a company name to distance the organization from mobile technology is in widespread use—Wind, Blue, O², 3 are some speci?c examples—but the process began with Orange.

7.4.2 Honest and dynamic
These values were reiterated in several specific and unique offerings for the industry. Per-second billing and caller identification represented the initial manifestations of honesty and dynamism. Until the arrival of Orange, mobile users paid for minutes or portions of minutes even when using the mobile to make a call of only seconds. The concept of caller identification was unthinkable. Now, per-second billing and caller identification are world-wide industry standards.

Other industry-leading examples included the Orange Value Promise, which gave customers the chance to use other operator tariffs on the Orange network if desired and the Orange Network Promise, where credit was given to users who experienced network connectivity issues.

Orange also influenced the analyst community. Prior to the arrival of Orange, operators were fixated with average revenue per user (ARPU). While ARPU was, and still is, a critical measure, Orange was nevertheless able to introduce the concept of Customer Lifetime Subscriber Value (CLSV). This was a measure of APRU and customer churn, which expressed value over the lifetime of a customer relationship. The analysts of the industry lauded it, as it suited the long-term payback nature of mobile network investment.

Most importantly, honesty was evident in customer relationships. For example, telephone-based customer service staff would willingly indicate to customers when it was felt that they were paying too much by subscribing to the wrong tariff. Customers, pleasantly surprised, would happily migrate to the lower-priced tariff, but thereafter feel inclined to stay with the network longer, underpinning the CLSV perspective above. This is an example of how an extensive internal focus on being the strategy and living the brand ensured that the customer expectations were not just met, but very often exceeded at each exchange.

7.4.3 Refreshing
Collectively, the Orange position represented a refreshing perspective for the industry. Technology was relegated, customer needs were emphasized and communications were clear, but concise.

Moreover, the organization expressed an ability to see beyond its services and even developed the ability to laugh at itself. A good example of this phase was in a run of print advertising which listed activities that could be accomplished with the mobile switched on or switched off. Separately, cinema advertisements of the fictional Orange Film Board reinforced a refreshing perspective. Here the ‘board’ cheekily pitched bogus film scripts with the mobile phone as the star, before stating the core message of Don’t let a mobile phone ruin your movie.

8. Final caution—be careful what you wish for
Striving for excellent customer experiences is what Orange sought and is what most organizations seek. It is difficult to achieve and maintain excellence, as this paper has indicated. Worryingly, however, there are some additional, and perhaps unexpected, pitfalls for successful brands.

Great brands attract talent. People want to be associated with them. They sense the opportunity to display their abilities. Over time, however, great brands attract idlers, too. Idlers are those people who are good at doing very little, surviving instead on the efforts of the people around them. For them, there is less to do in a successful company. They can be more difficult to locate, and they share in a larger reward than if they worked in a lesser organization.

Great brands can also suffer from too much of a good thing. Messages which are constantly stated, but are poorly reinforced by actions, can lead to traits of arrogance or complacency in the organization. Soon, the once valuable programme of community building is perceived as nothing more than corporate propaganda. Sadly, an unending diet of statements, without positive reinforcement, can bring about a culture that is at odds with the brand position that is being espoused.

Finally, great brands can be poor at knowing when the period of success is over. No organization is excellent forever. In fact, the life expectancy of organizations is quite low, according to Arie de Geus.¹⁴ While at Shell as Head of Planning, he searched for benchmarks from other organizations that were, like Shell, at least 100 years old. Interestingly, he and his team found only 40 firms of that age. They concluded that organizations could indeed last longer, but that many of today’s company systems do not nurture this kind of tenure. The result of shorter-term systems is that most organizations will eventually face fundamental change. This could be in their market-place, political system or in the loss of a leader. Each of these examples indicate a need to reevaluate the emphasis in strategy and brand management. The issue here is that while poor and average organizations live in a very real world of knowing that the end could occur at any time, successful organizations are often blind to anything other than business-as-usual expectations.

Conclusion
This paper has discussed brand management and the customer experience. This has been done not by dissecting brand management into its specific components, but by illustrating the robustness of brand management when placed appropriately in an organization. The paper has also highlighted the need to supply employees with tools—identity and guiding principles—to interpret and personally apply organizational attributes. Among other benefits, these employee tools help to breed a consistent and high quality customer experience externally. Both customers and organizations can determine the overall worth of individual customer exchanges by the presence of brand values.

Finally, it is worth reiterating that people are the key ingredient in any branding effort. It is the actions of people inside an organization that feed the experience of those outside the company. The journey of providing quality customer experience is long and can be arduous. It begins at the heart of an organization. It begins with employees who are being the strategy and living the brand.

Notes
1. O. E. Williamson and S. G. Winter: The Nature of the Firm: Origins, Evolutions and Development. New York: Oxford University Press 1993.
2. N. Ind: Living the Brand, 2nd ed. London: Kogan Page 2004.
3. SMART: a popular mnemonic to recall best practice for constructing Objectives. It states that objectives should always be Strategic, Measurable, Achievable, Realistic and Time-based.
4. McDonald’s Restaurants v. Morris & Steel (1999), colloquially known as the ‘McLibel Case’, which, despite the label, McDonald’s successfully argued.
5. Consider the accusations placed on corporations by corporate critics such as Naomi Klein (No Logo) and Michael Moore (Roger and Me, Fahrenheit 9-11, Bowling for Columbine). Consider, too, the resulting difficulties that can occur when trying to defend against same (e.g. establishing the difference between political speech and corporate speech in Kasky v. Nike, Inc. (2002) 02 C.D.O.S. 3790).
6. See www.masterfoodsconsumercare.co.uk/veg_status.asp: ‘At Mars UK we recently changed the source of some of the whey which is used in some of our chocolate products. We have received lots of feedback that this decision has made it difficult for some of you, especially those of you who are vegetarians, to continue to enjoy our products. We made a mistake. We apologise. The consumer is our boss. Therefore we listen to you and your feedback. As a company we value openness, honesty and diversity and we believe that anybody should be able to choose freely from our range of chocolate brands. But being sorry isn’t enough. Therefore we commit to you today, that we at Mars UK will ensure that a selection of your favourite brands—Mars bars, Snickers bars, Galaxy and Maltesers, will be suitable for vegetarians in the near future. To this effect we are starting to change our manufacturing process today. We will keep you informed of our progress against this commitment through regular updates on this website. Please accept our apology and keep talking to us.’
7. See the statement of Dr Annette Pinner, Chief Executive, the Vegetarian Society, at www.vegsoc.org/news/2007/mars.html, May 21, 2007: ‘The Vegetarian Society’s door is always open to companies seeking to better serve vegetarians. A Masterfoods representative has made contact with us and we are very pleased that they now recognise the importance of integrity to all their customers, especially vegetarians. We cannot endorse any planned actions by the company until we receive detailed assurances about the ingredients and processes involved in production but we are delighted that Mars UK has been honest enough to mark the beginning of National Vegetarian Week by admitting that it made a mistake. The best thing they could do now is, of course, to take up our accreditation scheme and earn the right to brand their products as Vegetarian Society Approved.’
8. L. Kahney: ‘Mac Loyalists: Don’t Tread on Us’, Wired, December 2, 2002.
9. S. Captain: ‘Fans Storm Apple’s 5th Avenue Store’, Wired, May 19, 2006.
10. The successful and award winning Green My Apple web-based campaign organized by Greenpeace is now archived. This weblink tells the story of how Greenpeace enticed the Apple customer base to influence the organization’s green policy: www.greenpeace.org/international/news/greening-of-apple-310507.
11. Orange gained the top ranking for customer satisfaction among mobile phone contract customers in the annual J. D. Power and Associates 2005 UK Mobile Telephone Customers’ Satisfaction Study, seven times in the period 1998–2005. In October 2005, Orange won the Mobile Choice Consumer Awards—voted for by readers of Mobile Choice magazine—for Best Network Operator for the fifth consecutive year. In the same month, Orange also won Best International Mobile Operator at the World Communications Awards.
12. Today the Orange.com website cites these five behavioural values alongside three additional values that describe the reputation it seeks: trusted, innovative and responsible.
13. A brief synopsis on Hans Snook, his business philosophy and his time at Orange is in C. Langdon and D. Manners: Digerati Glitterati: High-tech Heroes. Hoboken, NJ: Wiley 2001.
14. Arie de Geus worked for Royal Dutch–Shell for nearly 40 years. His book introduces the concept of treating companies like living work communities. It is regularly short-listed as one of the best management books of all time. A. de Geus: The Living Company. London: Nicholas Brealey Publishing 1996.

Note: This is a post-peer-review, pre-copy-edit version of an article published in Journal of Brand Management, vol. 15, 2007, pp. 102–14; published online October 9, 2007. The definitive publisher-authenticated version, ‘We the People: the Importance of Employees in the Process of Building Customer Experience’, is available online at: www.palgrave-journals.com/bm/journal/v15/n2/abs/2550123a.html.