Unformatted text preview: 02.07.02 THE BRAND INSIDE
JAMES BROOKE, CLIENT SERVICES DIRECTOR, MARITZ Maritz and the CIM reveal the practices of companies who achieve a good fit between their brand promise and the way in which their employees think, feel and act. The Chartered Institute of Marketing THE BRAND INSIDE 02.07.02 THE BRAND INSIDE Living the brand has already become a rather well-worn expression on the corporate conference circuit, and increasingly Marketing Agencies are setting up ‘Brand Engagement’ offers. But to what extent are large companies seriously committed to developing their people as a means of building the strength of the brand? Maritz was sponsored by the Chartered Institute of Marketing to peer under the bonnet of the Living-the-Brand bandwagon and take a long, hard look at what works and what does not. In other words, to get a sense of what is hot air and what genuinely drives the business agenda – and of course does any of this really matter to the bottomline anyway? We undertook an original piece of research to identify the habits and practices of companies who achieve a good fit between their brand promise and the way in which their people think, feel and act. The study took the form of an initial piece of desk research, auditing every text we could find on the subject, followed by twenty face-to-face interviews with senior executives from twenty well-known large organisations. We took a spread of respondents across the disciplines of Marketing, Communication and Human Resources, all at board director level or equivalent. Each interview lasted 60 to 90 minutes and followed the same structure. Companies who have participated include: Barclays and HSBC in financial services, McDonald’s and Whitbread in Leisure, Safeway and Tesco in retail, and Unisys and Xerox in IT. Respondents were asked to relate anecdotes, both good and bad, about living the brand. They were also asked for examples of good and bad practice that they had come across. This feedback was combined with Maritz' twenty five years of experience in the UK and Europe. Therefore not all companies mentioned in the survey were among the twenty who provided responses. Ian Ryder is Director, Marketing Communications at Unisys, prior to this he was Director, Marketing Communications at Hewlett Packard, in a global capacity. His view gives us a useful starting point: “Brand management is simple: it’s a case of make a promise, keep a promise.” We then sought to understand from our respondents which element of this is most crucial to building brand equity in the longer term: ‘making the promise’, in other words, brand communication, or ‘keeping the promise’, in other words, the day-to-day delivery. Naturally, it is difficult to come up with figures to quantify the relative importance, but typically our respondents suggested roughly an 80/20 split, in terms of day-to-day delivery. Executives to whom we spoke in the retail and grocery sector, estimated that about 70% of customer perceptions of their experience tended to be driven by people-to-people moments. This was estimated to be even higher in the retail and leisure sector. Multitude transactions between ourselves and our customers HSBC is rated as the UK’s most admired bank (Management Today survey November 2001). A decade ago under the Midland Bank branding, it had one of the poorest images in the sector. Keith Brown, HSBC’s Head of HR Strategy explains that the rapid improvement in the brand image cannot be solely put down to advertising, in fact the company has not put a major emphasis on above-the-line campaigns. Brown says, “the strengthening of our brand image has come about because we have put the emphasis on the multitude transactions between ourselves and our customers”. “Brand management is simple: it’s a case of make a promise, keep a promise.” © Copyright Maritz Ltd 2002 2 THE BRAND INSIDE 02.07.02 HSBC has focused on plain language to achieve this. Inside the organisation people now try to avoid marketing jargon and talk in terms of ‘The experience that the customer really wants’. Making sure that every practice works to support the brand Clearwater is the name given to the bank’s philosophy of making sure that every practice and process, inside the bank, works to support this desired customer experience. This covers measurement, appraisal, training and communication. Brown states, “the philosophy is that if we can’t show how it is ultimately going to help us deliver the desired customer experience then we shouldn’t be doing it”. Many people we spoke to in the financial services sector rated HSBC as a star performer. As the CEO of another bank put it: “HSBC has really got its act together quietly and without a fuss”. Clearwater was seen to be a success because it is one singular initiative that covers all of the strategic thrusts of the company and makes sure that all processes and practices worked to support the brand. It is not pigeon holed in to a single department or discipline. The existence of one over-arching theme was seen to appeal when so many organisations are suffering from ‘initiative overload’. Clearwater has no underlying strap line to explain it. It is simply understood across the organisation that it covers everything that needs to be done to: “Put Clearwater between us and our competitors”. Hewlett Packard became one of the world’s most admired brands by following a similar philosophy. While heading up Marketing Communications, Ian Ryder instilled his belief that: “Customer loyalty comes from brand values, delivered at moments of truth, through people”. At Hewlett Packard every managerial practice had to stand the test of whether it contributes to the way in which the company delivered against its brand values at customer moments of truth. Before authorisation was given to invest in training, for example, the influence on the brand was always a key criterion in making the decision. Ryder emphasises that this applied as much to investment in technical training as it did to softer behavioural training such as customer handling skills. Where a drive to rally the organisation behind the brand succeeds, it is not treated as a new initiative. Rather it is positioned as an umbrella coordinating and pulling together all other practices, processes and initiatives so that they are all coherent and focused on the same purpose. Introducing new initiatives increases complexity. Increased complexity hinders communication and organisational focus. Many employees to whom we spoke complained of being ‘bombarded’ or ‘overwhelmed’ with internal ‘glossies’ or ‘junk mail’. These employees are bombarded, as consumers outside work, with continual and persistent advertising messages. It seems that companies are in danger of creating the same cacophony inside the organisation. Clearwater works because of its singularity. It covers everything but to a single consistent end. Running at the same pace internally and externally Brand repositioning often falters when changes on the inside of the company do not keep pace with the new messages about the brand sent to the external marketplace. Companies need to learn to run at the same pace internally as well as externally. We came across the example of a retailer sending a family-friendly message towards its consumers without introducing family-friendly policies for its own staff.
© Copyright Maritz Ltd 2002 “HSBC has really got its act together quietly and without a fuss”. “Put Clearwater between us and our competitors”. “Customer loyalty comes from brand values, delivered at moments of truth, through people”. 3 THE BRAND INSIDE 02.07.02 Crèche facilities were very limited and not extended to all working mothers. To its credit, the company recognised this and acted fast to prevent the risk of disillusioned staff acting as terrorists towards the brand. Lee Cloete who was Management Development Manager at Safeway, recalls a similar experience when Carlos CriadoPerez, the new charismatic CEO started the transformation of the company. “When Carlos entered with a great deal of drive and enthusiasm, things improved greatly, but there was still always a very real danger of talking a great story to the outside world before you have got things right internally. We were in danger of creating dissonance among our customers and staff.” We came across the example of a large financial services firm that included ‘Progressive’ as one of its values. At the same time employees complained of being unable to send or receive e-mails from customers because systems were so antiquated. Naturally, this became an opportunity to use the brand values as a stick with which to beat the company. To its credit the company concerned had the mechanisms in place to listen to this feedback. This particular problem was made a priority to fix. This is a key function of the brand values, providing a framework to set the organisation’s priorities against. When Barclays sought to reposition its brand for the first time in thirty years, it was meticulous about running at the same pace, internally as well as externally. As events transpired, the fact that it had put in place the infrastructure to communicate with staff helped it to deal with potentially very negative public relations in the outside world. Barclays was voted the world’s most improved bank recently in a survey of readers carried out by a worldwide banking magazine. This was a rapid turnaround from the demoralising PR that the bank had suffered in recent years. As Barclays launched its advertising campaign based on the ‘Big’ theme. The media was awash with criticism of the bank. Either for closing branches or introducing ATM charges. Negative stories damaged morale. As Barclays sought to reposition its brand, it made a major investment in communicating with its own staff, recognising that success was ultimately all down to their ability to deliver the desired customer experience. In fact, success was attributed to the fact that staff and customers were given equal emphasis. “We were in danger of creating dissonance among our customers and staff”. © Copyright Maritz Ltd 2002 4 THE BRAND INSIDE 02.07.02 Malcolm Hewitt, UK Director of Sales and Service would even recommend taking this a step further. He maintains that, from experience, if there were one thing the bank would have done differently, it would be to put their own staff first in the communication plan, before any communication went out to customers. Barclays measured the effectiveness of its brand communication to staff. A quantative survey, tracking the attitudes of those who had attended the brand communication event, showed an improvement on the ‘Teamwork and Leadership’ index of 18 percentage points. Internal practices should be as unique and differentiated as the brand Disney and Nike were frequently cited as companies who were seen to successfully ‘live the brand’. A characteristic of both companies is that they have their own language and modus operandi, reflecting the brand image inside the company. These factors cover both symbols and practices such as communication. Nike is believed to be a highly meritocratic and competitive company, reflecting the brand essence, which is all about the joy of winning. Employees at Nike’s head office will be familiar with the Nike Walk of Fame, which reminds employees of the company’s heroes and role models. Disney has its own language. Customerfacing staff are called ‘cast members’ and shifts are referred to as ‘performances’. McDonald’s, currently rated as the world’s most valuable brand, has a similar philosophy of aligning symbols and practices to its outward-facing brand. Team members are known as ‘crew’ and team briefings are called ‘rap sessions’. Founder’s day, once a year, reminds employees of the company’s heritage. The challenge to McDonald’s as it adopts more of a ‘think local’ approach is to develop a language that is less Americanised but is equally unique and specific to the McDonald’s brand. © Copyright Maritz Ltd 2002 5 THE BRAND INSIDE 02.07.02 Differentiating through practices and processes Indeed our research suggests that building a truly world-class brand requires the company to make sure that all of its internal, processes and practices and symbols, fit with its brand values. A company may adopt some generic best practices, just as there may be generic elements to a brand, but in essence it is as important to have unique and differentiated processes and practices as it is to have a brand that is unique and differentiated. We would ask senior HR and Marketing people to look at their practices such as induction, recruitment, appraisal and reward systems. If these practices are generic or ‘off-the-peg’, it is likely that they will struggle to differentiate their brand through their people. This means that if the company’s brand is playing the role it should in creating value for the company, it should be viewed as a simple cohesive framework for organising all of the internal practices and processes and making sure they work towards creating the desired customer experience. The case study of Asda was one of the most commonly cited examples of a company aligning its internal culture successfully to its brand. A key characteristic was that changes were seen to be driven with charisma from the leadership of the company. Equally crucially was that Asda did not deploy standard recognised best practice when it came to people management, it developed its own best practice. The reinvigorated brand centred on Asda’s practical, no-nonsense heritage as Yorkshire traders, which emphasised value for money for its customers. It was recognised at the outset that this would require loyal motivated employees or colleagues. Asda introduced innovative changes, such as giving colleagues a day off to mark their child’s first day at school, or – as a fair proportion of the workforce is over sixty – it introduced special ‘Benidorm leave’ to show the value placed on older colleagues. The most crucial vehicle for culture change was however the ‘Asda huddle’. This was a new way of running meetings which was practical and effective. Meetings are an important ritual through which one can observe the predominant culture of the organisation. Conversely, if one seeks to change culture, the ritual of meetings is often a good place to start. At Asda, the huddle was introduced as a regular fast and focused team meeting. It has a fixed agenda, which centres on a limited number of measures that relate to Asda’s brand values and the customer’s instore experience. Teams have the power to self-manage. In other words, they agree on actions which would previously have been outside of their sphere of influence. Recruitment and induction were highlighted as important levers to shape internal culture. After all, it was suggested your customer service culture is largely a factor of the people you bring in to the company. TGI Fridays were pioneers of using innovative techniques for recruitment. Interviews were dubbed ‘auditions’ and often the candidate would have to perform on the trampoline while answering questions. We were told about a leading US restaurant chain which had changed its recruitment process for waiting staff, by introducing the practice of having customers participate in the interviews, and take a view on the candidates by whom they best felt they would like to be served. Interestingly many respondents to whom we spoke felt that it was the conventional wisdom of HR departments that was most inclined to provide resistance to these type of innovations.
© Copyright Maritz Ltd 2002 6 THE BRAND INSIDE 02.07.02 “We wanted to avoid a set of values that could be very much seen as being generic or ‘off the shelf’”. Again, the obstacle seems to be an attitude that seeks to value generic best practice ahead of practices that could be uniquely owned by the organisation and could therefore help to differentiate it in terms of both culture and brand. It appears that the commonly cited case studies of culture change (such as Xerox, BA, ASDA), are characterised by leadership being bold enough to dispense with conventional wisdom and try something different even if it is not tried and trusted. We also heard about the converse to these good examples, in the form of an anecdote about a customer services director from a larger retailer who had simply tried to import Prêt a Manger’s practices wholesale. This never fitted comfortably and was ultimately rejected by the rest of the organisation. It never succeeded in winning the ‘buy-in’ from the rest of the organisation because it was seen as being borrowed and not uniquely owned. People did not feel a stake in the new ways of doing things. Safeway sought to embed ‘an internal working style that reflected the aspirations of the brand’. “We wanted to avoid a set of values that could be very much seen as being generic or ‘off the shelf,’” says former Management Development Manager, Lee Cloete. Instead the senior team went through a process of self-examination, by looking at the success or failure of all recent projects or initiatives that had been undertaken. By understanding the styles of working that had worked well for them in the past, the team were able to commit to a number of key principles of their internal work-style. They avoided over used-words like passion, integrity and teamwork. © Copyright Maritz Ltd 2002 7 THE BRAND INSIDE 02.07.02 The role of the brand on the inside In 1999, the Human Resources Forum in conjunction with Cranfield School of Management commissioned a study into the link between ‘employee commitment’ and ‘corporate success’. The study entailed over 100 hours of interviews with senior executives for a range of leading organisations, such as Sony, Granada and Iceland. Those organisations whoose external brand had measurably high brand equity, reported that this had a significantly positive effect on their ability to attract and retain the more sought after people.Those companies who had relatively less equity in their brand reported a distinct disadvantage when competing for talent against companies with stronger brands. A strong brand appears to be potential source of internal motivation. Peter Legg moved from RJR Nabisco in Canada to become Human Resources Director for Kellogg’s, in Europe he recognised this. “I felt we had a great brand and we were not taking full advantage of it to raise spirits and morale inside the organisation”. “I felt we had a great brand and we were not taking full advantage of it to raise spirits and morale inside the organisation. Externally we were all about serving the health of the nation. I felt that we should emphasise that this was a really worthwhile cultural mission and try to bring the spirit of this in to the work place more. We changed the physical environment to inject more fun and to bring our product, our brands and our consumers into our working environments. I have always liked working in consumer goods companies because we have more scope to introduce some real fun around your brands, into the work place.” Guinness, part of Diageo, is one of the world’s best-known brands. Some years ago it was felt that some of the vibrancy had gone out of the internal culture. It was felt that all managers at all levels should feel a real, deep sense of connection with the Guinness brand and the product. Guinness undertook market segmentation research in a way that really brought to life its key customer types – who they were, their values and aspirations, and most crucially, how they related emotionally to the Guinness brand. Guinness then ran ‘Consumer Connect’ sessions to which all of its people were invited. These sessions were run during lunch time at Guinness’s office they were fun and interactive. They invited consumers in to meet with Guinness managers and discuss their values, aspirations and ways in which they related to the brand. The sessions were high-energy, fun and interactive. Guinness also introduced brand-dunking exercises where managers would get out and meet with consumers in pubs and clubs. All of these events were characterised by a lot of physical branding… tactile goods that related to the brand and were fun to play with, such as drinking mitts, and foam plastic imitation pints of Guinness. © Copyright Maritz Ltd 2002 8 THE BRAND INSIDE 02.07.02 Making it physical Senior executives of a leading insurance company were discussing ways to enhance the energy and enthusiasm around broker service and broker satisfaction. It was felt that if they could create greater urgency, focus and fun in their offices, service to the broker would improve, as the relationship with the broker improved. One of the team pointed out that more of a ‘buzz’ always seemed to be created in the retail or restaurant sectors, than in something less tangible and more removed from the customer, such as insurance. After discussion, the team concluded that the crucial factor was that in a shop or restaurant staff are physically closer to the whole theatre of the customer. In other words, they are physically closer to the theatre of their customer’s joy or pain. The solution at first seemed particularly off the wall. In certain offices there would be a model-sized mock-up of the broker’s office together with model-sized people to represent the broker and the broker’s staff. This introduced a tactile element to team meetings. The model of broker could have arms raised if particularly happy or be prostrate on the floor if particularly unhappy. The senior managers observed a notable difference in the office where discussions about broker satisfaction took place around the mock-up of the model. There was a greater sense of urgency, fun and involvement; the sort of characteristics that the team of senior executives had sought to create. For British Airways the introduction of the larder for midnight snacks on Club Class flights was a physical reminder to both customers and cabin crew of what the brand promise was about. Likewise the no-nonsense barrows of fresh produce at ASDA, set out like a market trader’s barrow was a physical manifestation to colleagues of the heritage of the brand. Brand and internal culture The brand has a powerful – often overlooked role – inside the organisation. In fact, we came across an example of a powerful and valuable brand that functions solely on the inside and has no outwardfacing role. When Whitbread sought to revive its under-performing Beefeater chain, it took 90 of its restaurants in the most affluent neighbourhoods and undertook some research to understand how to reposition the brand so that it appealed to more affluent customers. It discovered that these customers particularly disliked branded eating out experiences. Whitbread launched a brand with no branding. Out-and-Out is a restaurant chain positioned to compete with upmarket neighbourhood restaurants, however it is a chain with no or minimal external branding. Out-and-Out serves as a purely internalfacing brand, to rally all of the staff around a set of standards, values and behaviours. The décor and service style is consistent. Even the dress of staff is consistent, although there is no uniform. Whitbread refers to this as an ‘Out-of-uniform Uniform’. Since converting from Beefeater, Out-andOut restaurants have experienced a 20% uplift in like-for-like sales. This inextricably links brand management with organisational attitude and behaviour. © Copyright Maritz Ltd 2002 9 THE BRAND INSIDE 02.07.02 Mark Waller, Manager, Brand and Specialist Communication for Renault UK, sums it up: “Brand Management is essentially about culture change.” “Brand Management is essentially about culture change.” This poses a number of questions: Can Marketers be shapers of culture? And more fundamentally: Should Marketers be focused on building brand equity or doing brand communication? Shifting the locus of control In their book, The Seven Cultures of Capitalism, Fons Trompenaars and Charles Hampden Turner identify a western model of running an organisation, which holds within it certain cultural assumptions. One of these is that the locus of power and influence of any organisation tends to sit at the centre. It is the role of the people at the centre to develop plans and ideas and then to hand them down to be implemented by people in the field or at the customer interface. The residue of this culture is still very apparent in many of our leading organisations. People increasingly recognise the theoretical benefits of empowering people at the customer interface but progress in this direction was still felt to be held back by a ‘head-office-knows-best’ attitude. In his book The Human Equation, (Harvard Business School Press), J Pfeffer cites studies from the Semi-conductor, Apparel and Automotive industries all of which suggest that there is a strong direct correlation between the amount of latitude staff have to make decisions and the performance of their organisations. This is consistent with the work of Heskett et al and the book, The Service Profit Chain, which cites the examples of South-West Airlines, Amex and Marriott Hotels among others, all of whom have seen radical improvements of performance, coinciding with giving staff greater latitude and flexibility. In the Cranfield and HR Forum Study, of 1999, referred to by Parkes, Senior Executives who participated were asked whether they had come across examples of corporations who regretted having given greater trust and latitude to employees. There were no such examples. This exercise was repeated for this study, again, we could find no examples of companies who regretted trusting their employees with greater latitude and flexibility. The explanations put forward for this make good intuitive sense. On the one hand staff, because they can make decisions, feel more valued and care more about the organisation and its customers. On the other hand, decision-making is more ‘fleet-of-foot’. The people who know the customer best can make decisions without having to refer upwards to somebody who is not as close to the customer. The simple fact is, it appears, that in most cases head office simply does not know best. It has been pointed out by people knowledgeable about military history, that the single common characteristic of every great military disaster in history is the lack of an effective feedback mechanism. The more customer-facing staff are able to participate actively in the implementation of strategy, and the more efficient the ‘listening mechanism’ from the customer interface to the centre, the more likely a company is to be delivering its desired brand experience. This does not sit comfortably with most large organisations. The sociologist Max Weber, would still recognise many of today’s organisations as being essentially run along the lines of a bureaucratic model. In this model the
© Copyright Maritz Ltd 2002 10 THE BRAND INSIDE 02.07.02 tendency is for power and influence to be centralised and for those at the centre to be instinctively reluctant to let go. We came across the example of a large financial services company, which had recognised that its network of front-line managers across the country were an underutilised resource. A project team put a plan together to involve them actively in the company’s push for better customer satisfaction and quality. As such, they would lead the initiative on the ground, briefing teams, focusing on measures and helping teams to self-manage. However, the project teams were staggered by the degree of resistance to this plan by other head office personnel. It was suggested that the front-line managers could not be trusted and that this initiative was way too important to be left up to them. It was also suggested that when this had been tried in the past this group of managers had not been up to it and that head office had had to take back control. In this instance, investing a modest amount of time and resource in training these managers for their role and winning their buy in, supported by making them feel involved, was all that was required to make the initiative succeed and pay back the investment many-fold. Safeway recognised the power of language in either challenging or reinforcing an existing set of latent assumptions. Most multi-site companies have a head office. The implicit assumption in this is that the company is there to serve its Head Quarters. This implies prioritising HQ ahead of customers. This means that the company is culturally facing the wrong way; inward looking, rather than outward looking towards customers. Safeway named their head office as The Store Support Centre, as did DIY retailer, Wickes. We would ask any large multi-site corporation whether they have a head office or a support centre the answer is indicative of the current state of the culture. The tyranny of trade-off So if increased latitude or empowerment leads to better performance, how come some of the world’s most successful brands are highly formulaic and give people little latitude when delivering them. Well, a number of explanations have been put forward for this. If we take the example of McDonald’s, standardisation is absolutely central to the proposition. Across the world, consumers know that they will be getting consistency of standards across product and service. The customer is not promised customisation and does not go to McDonald’s in search of customisation. On the other hand, Marriott Hotels deals with tired and stressed business travellers from across the world, each with their own idiosyncrasies, problems and requirements. The only way the brand promise can be delivered is if the customer is being dealt with by somebody who has the authority, resourcefulness and motivation to make the right decisions. On face value, increased empowerment of staff seems to run counter to the principles of brand management. Brand management requires resources always to be coordinated to a consistent standard. Empowerment suggests that everybody will be doing his or her own thing. The common response is that we require empowerment within a framework. In our experience, many corporations failed at their attempts to introduce empowerment because the strategies were badly implemented or badly thought through.
© Copyright Maritz Ltd 2002 11 THE BRAND INSIDE 02.07.02 The ‘empowerment within a framework’ argument is often used to reverse empowerment and re-establish control. The power of language again is important here. By emphasising the framework, we emphasise the limits to people’s empowerment. In short, mediocre organisations tend to be stuck in the belief that there is a trade off between empowerment and consistent delivery of the brand promise. “It is a ‘both and’ not an ‘either or’”. A characteristic of organisations with worldclass brands is that they recognise that this is not a trade off. As one respondent put it: “It is a ‘both and’ not an ‘either or’”. The practices we observed of companies that achieve both high levels of empowerment and consistent delivery can be summarised as follows: 1. Build a deep intuitive understanding of your customer, their needs, wants concerns, values and lifestyle. This understanding should be shared, not only across customer-facing staff, but also among all those who support customer-facing staff. 2. Build a shared understanding of the desired brand experience and how it delivers value for customers. 3. Emphasise trust. This is a two-way contract, employees, in our experience, are more than capable of accepting that with trust goes responsibility 4. Emphasise what people must do, not what people must not do. Thomas Cook Retail faced resistance from a number of its branch manages. Repeatedly emphasising the things that branch managers were not allowed to do to the fascias of their retail outlet was not well received. Emphasising that branch managers were free to use their discretion provided fascias were minimal, uncluttered and on-brand was far more constructively received. It’s a subtle difference in the positioning of the message, but an important one. Building the business around the customer Companies, who successfully live their brand, do not see one single department as custodian of the customer relationship. They do not rely on market research data to inform their knowledge of the customer. They seek a profound understanding of the customer’s lifestyle and values, and the ways in which the customer relates emotionally to their brand. They then seek to spread this understanding at an intuitive level throughout their organisation. Darren Briggs is Head of Group Internal Communication at Vodafone. He was with British Airways, during their radical culture change process towards the end of the 1980s, and witnessed the company transforming itself from an operationallyled bureaucracy to a customer-focused service business. He comments: “At one time the airline industry was all about issues like logistics and route coverage, getting a plane safely from a to b. Nobody paid much attention to the actual experience within that long metal tube or on the ground at the airport. Real change happened when people across the company started truly to connect with the experience of the customers and how they felt. A similar pattern of change can be seen in the telecommunications industry. At one time we were solely technology led. It was all about the product or the coverage. Now people recognise that the customer has an overall relationship with us as a brand.
© Copyright Maritz Ltd 2002 12 THE BRAND INSIDE 02.07.02 They demand a certain type of experience with us that can be delivered through a whole range of touch-points. It is this experience of the brand and the way in which it meets our needs that will build our loyalty over time”. In a similar way, we can see the victory of the more customer-centric company in the market for handsets. Ericsson’s pedigree was second to none in this market. It had a one hundred year heritage of engineering excellence in telecommunications. However, since the mushroom-like growth in the mobile phone market of the late 1990s, Nokia has beaten Ericsson hands down in the battle for growth in market-share. Equally, independent tracking studies show that over this period companies who perform best at innovation and product leadership appear to place an understanding of their customer at the heart of their business. They also show better connectivity across departments and are willing to work with channels and partners to innovate on behalf of customers. Walkers is the UK market leader in salted snacks. In the mid 1990’s it faced saturation and little headroom for growth in the main potato crisp market. In spite of this, substantial growth came from the introduction of a new packaging format ‘the grab bag’. Larger than the standard format, the grab bag was just sufficient to satisfy the motorist’s hunger pang. Walkers were able to satisfy a new customer need that had not hitherto been satisfied by the existing packaging format in the potato crisp market. This innovation came about through discussions between sales, marketing and the retailer. The insight came from listening to the retailers’ observations about customers who entered their outlet. Unilever took a very different approach to innovation. Recognising its importance innovation centres were set up around the world. This entailed taking the best brains in marketing and placing them in an environment specifically made for blue sky thinking. Success was very limited. Innovation performance was improved when a different approach was tried which was predicated on connectivity across departments and listening to a wide range of inputs. As authors, Treacy and Wiersema say in the ‘Value Discipline of Market Leaders’: Product Leadership companies recognise that good ideas can come from anywhere… they constantly scan the horizon for good ideas. © Copyright Maritz Ltd 2002 13 THE BRAND INSIDE 02.07.02 Marketing departments are in danger of becoming disengaged Our research suggests that too frequently marketing departments are becoming marginalised when it comes to the question of who really takes responsibility for building the company’s brand equity. “If you talk to most managers in the company about our brand”. As one respondent told us: “If you talk to most managers in the company about our brand, they would consider this to mean the things we stand for. If you talk to the marketing department, they would probably be more likely to see our brand in terms of our brand identity”. Too frequently, marketing departments are in danger of becoming disengaged with the rest of the company. There is increasing recognition that brand management requires an holistic approach which actively engages all parts of the organisation, including operational and supply chain roles. Our anecdotal evidence suggests that marketing departments are frequently failing to take a lead in this and they are often seen as being proprietorial over their professional turf. A number of respondents also suggested that the use of jargon and buzzwords had undermined the credibility of marketing. Ian Ryder points out that, as Marketers we often do not help ourselves by being seen to invent new jargon. “Imagine if Accountants were to change the terminology they use every couple of years”. “Imagine if Accountants were to change the terminology they use every couple of years. People would soon stop taking them seriously. Why should we be any different? We had just got our colleagues used to the idea of brand management when people started saying ‘its not about that anymore, its all about CRM now’”. Using plain language In fact, a number of very progressive companies in this field acknowledge that they are focusing on implementing brand management internally but avoid using the word ‘brand’, because this has connotations of jargon or marketing fads, or it is likely to lead to esoteric debates about the definition of the term. Charles Carr, Head Of Internal Communications at BAe Systems says: “The term ‘brand’ still muddies the waters. What we are focusing on is essentially brand management by any other name. We have started to talk about ‘delivering what we say we are going to deliver’ as the route to Shareholder Value”. Or as Fraser McDonald, Head of Communication for Tesco puts it: “We decided to be clear about the brand and cut through the waffle, we now talk about ‘what the customer experience is really like’.’ HSBC avoids talking about Clearwater as a brand-led programme as they feel that this positions it solely as a marketingdriven initiative. “What we are focusing on is essentially brand management by any other name”. “we now talk about ‘what the customer experience is really like’”. © Copyright Maritz Ltd 2002 14 THE BRAND INSIDE 02.07.02 Eight Key Principles From our research we are able to identify eight key principles for any organisation seeking to create a world-class brand through its people. 1. Emphasise freedom not control Jill Grinsted is Director of Partnerships and Marketing for Avis. She says: “We now recognise that if you want people to try harder you need to give them the freedom to try harder”. Too frequently organisations feel that, to deliver a consistent brand experience, they have to slip into control-mode. Effective brand management requires the company to agree a number of steadfast principles, which will always form part of the brand experience. Beyond that staff need to be trusted to get on with things. 2. Decentralise Companies who succeed in delivering a desired brand experience, tend to roll back the frontiers of head office. Whitbread used to employ nearly 500 people in its group office. It now employs around 30. Traditional head office roles have now been attached to the brands. The rationale: everybody, whether they be finance, operations or HR, has a deep understanding of the desired brand experience and this always remains paramount when making any decisions. For example, if somebody is pushing for a 2% increase in operating margin, he or she can weigh this up in the context of its likely effect on the brand. Safeway similarly has sought to roll back the frontiers of head office. Safeway’s head office has now been renamed the Store Support Centre. 3. Do things differently Companies who build world-class brands emphasise processes and practices that are uniquely owned by them. They do not emphasise generic best practice. TGI Friday would not be one of the world’s strongest restaurant brands if it followed generic best practice in recruiting staff. Instead the recruitment process takes the form of an audition with candidates, skating, juggling or dancing. As David Reed of Whitbread says: “It takes a very special type of person to do this job”. 4. Communicate your brand positioning to your own people before you communicate it to your customers While many companies are finally recognising the need to run at the same pace inside and outside the organisation. Leading edge companies focus takes this principle a step further. Brand management on the inside of the company outpaces the outward-facing elements of brand management. This entails building a deep intuitive understanding of the brand among one’s own employees before communicating the brand promise to consumers. “It takes a very special type of person to do this job”. © Copyright Maritz Ltd 2002 15 THE BRAND INSIDE 02.07.02 5. Keep it simple ‘Keep it simple’ is a mantra of Tesco’s CEO, Terry Leahy. While Tesco is the UK’s number one retailer they have achieved this position by driving for simplicity in everything they do. This applies both to the language and the processes they use. As the company has grown rapidly, Leahy has been rigorous in making sure that people inside the company do not become ‘burdened by processes that are baked into a bureaucratic nightmare’. Tesco uses simple jargon-free statements that act as a constant frame of reference. Thirteen customer values are covered by the phrase: ‘No one tries harder for customers’. A similar number of organisational values are covered by the phrase: ‘Treat people as you would expect to be treated.’. At HSBC, Clearwater works because it is one single concept that covers everything to do with enabling the company to deliver the desired brand experience. 6. Operate across functions The traditional organisational model, which has a department as custodian for the brand and a different department as custodian of the people, simply does not fit with world-class brand building. The most progressive companies increasingly work in a networked or cross-functional way. This enables the company to look at the way in which the brand promise is delivered to customers in a more holistic way. It also ensures that the way that people are hired, trained, measured and rewarded fits with the brand. Leadership is naturally crucial in creating alignment across these different functions. Many respondents felt that having a brand-literate CEO is a massive benefit in aligning the company to the brand. © Copyright Maritz Ltd 2002 16 THE BRAND INSIDE 02.07.02 7. Think longer term Great brands are built overtime. The average tenure of marketing professionals is becoming shorter and shorter. This is recognised as a problem. If brand-building companies worked on the same planning cycles as pharmaceutical companies when doing research, there would be more genuinely world-class brands. Brand building needs to be viewed as a seven to ten year planning cycle as opposed to an eighteen-month planning cycle. HSBC markedly does not refer to Clearwater as a 'programme’, as this suggests something finite. Keith Brown of HSBC says: “We did not want to give people the impression that this year we are going to fix the brand and then move on to something else”. As Ian Ryder puts it: “Most companies do not embrace all that is involved in brand building. The key things are follow up and make it stick”. 8. Measure Measurement focuses the mind and top performing organisations measure things that really matter to the brand. The crucial thing about measurement, however, is what happens to the results and the extent to which they are fed back to front line staff in a way that really drives actions. Tesco uses their ‘steering wheels’, which are Tesco’s equivalent of the Balanced Scorecard, with each wheel representing a key area of measurement: employee, customer or financial. HSBC is investing in developing sophisticated measurement systems to link employee satisfaction with customer satisfaction. At Whitbread they attribute the success of their strongest brands to the fact that they ‘measure every which way’, including mystery shops, customer panels, focus groups and satisfaction monitors. One of the things that attracted Whitbread to the Marriott Hotel chain was the fact that Marriott follows the same philosophy of measuring ‘every which way’. “We did not want to give people the impression that this year we are going to fix the brand and then move on to something else”. “The key things are follow up and making it stick”. © Copyright Maritz Ltd 2002 17 THE BRAND INSIDE 02.07.02 CASE STUDY 1 BARCLAYS Barclays set about the first major repositioning of its brand for the first time in three decades. The ability of Barclays’ staff to deliver the desired customer experience was crucial in this. However, the campaign was launched at a time of very poor PR – a situation that was potentially very de-motivating. The Barclays’ brand team, together with HR were faced with the challenge of embedding the behaviours required to deliver the brand promise – and at the same time re-energising the organisation. A set of organisational values were developed, which, it was felt, would help to drive the sort of behaviours that were going to make the brand promise a reality for customers. The intervention started with the buy-in of the top 1,000 managers. This was followed by a one-week coaching session for the top 6,000, to equip them to lead the change by displaying the appropriate behaviours. All 43,000 staff went through a one day total brand immersion, which focused on activities to give people a deep understanding of their role in delivering the desired customer experience. © Copyright Maritz Ltd 2002 18 THE BRAND INSIDE 02.07.02 CASE STUDY 2 RENAULT Renault sought to shift the centre of gravity of its brand, to enable it to sustain higher margins. The company invested heavily in brand-focused advertising and sponsorship, centred on the ‘Createurs d’Automobile’ strap-line. Renault recognised that a key source of competitive advantage would be the ability to create a total service experience to reinforce the brand positioning. Previous attempts to enter the executive market had experienced only very limited success. The Renault Safrane had been criticised for quality and supply problems. The Renault team recognised that if the strategy was to succeed then they would have to address some latent scepticism in the minds of the dealer network and some of their own people. Qualitative research was undertaken among Renault people and its dealer network. This allowed underlying obstacles and objections to be probed. Renault created unique live experiences for everybody within the dealer network, to enable them to gain a profound understanding of the brand experience, why it would benefit them in a business sense – together with their role in making it happen. A potential customer, who was able rigorously to challenge Renault senior managers over their strategy, chaired the live experiences. Thus each concern identified by the research was raised and addressed at the outset. The project team then developed a creative communications plan working with Renault. This focused on really bringing the customer to life in their own ‘habitat’ and shining a spotlight on the other experiences that would form their expectations of service delivery. The brand was also supported in terms of recruiting and training a team of Brand Development managers, to ensure that delivery of the brand proposition stayed on track. Follow-up research showed a qualitative improvement in support for the strategy, after the events. © Copyright Maritz Ltd 2002 19 THE BRAND INSIDE 02.07.02 FURTHER INFORMATION If you would like further details about our research or any of the other services that Maritz provides, please contact James Brooke on +44 (0)207 731 9614 or mail [email protected]
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