Brand oriented culture and institutional logics

concept of market orientation is also introduced and discussed as an alternative strategic management perspective with implications for business processes in relation to corporate brands (cf. the cognitive cornerstone of the competence-based view). Lastly, the following section draws on recent theoretical advancements within neo-institutional theory focused on institutional logics and introduces a novel compatible approach to develop and conceptualise brand orientation within the confines of the above-discussed four cornerstones of the

competence perspective.

embracing the logic of the organisation as a brand (Hankinson, 2001b, 2002; Ewing and Napoli, 2005; Evans et al, 2012).

2.3.2. Brand orientation: The behavioural perspective and dominant management logics

Brand orientation, viewed as a strategic (culturally embedded) logic, provides an operative rationale consistent with the systemic cornerstone of the CBV. If systematically deployed this brand oriented logic forms a strategic platform for guidance and direction in coordinating and aligning decisions, business processes, use of resources (i.e. behaviours) to the brand identity (Gromark and Melin, 2011; Urde 1999; Wong and Merrilees, 2007), which ultimately result in strong brand-supporting capabilities (Ewing and Napoli, 2005). With their tripartite ‘CVI’-model Hatch and Schultz (e.g. 2001) suggest placing a similar importance on the interplay between brand culture and behaviours as they advocate the management imperatives of aligning the corporate culture (C) to the corporate vision (V) and stakeholder images (I) in order to consistently deliver on the promise of the brand and thus preserve a trustworthy brand ethos of the organisation. Thus, from a behavioural perspective, brand orientation implies a distinctive modus operandi guided by the brand. In this respect, the notion of

‘living the brand’ (de Chernatony, 2010; Ind, 2003) is closely tied to the behavioural perspective on brand orientation by emphasising the crucial role of having employees enacting the strategic intent of the firm as informed by the brand identity in their everyday practices. A key argument for firm competiveness in this ‘brand enactment’ literature is that strong brand-stakeholder relationships may be build via a mutual appraisal of the brand’s values (de Chernatony, 2002).

Corporate brand orientation implies an integrative cultural and behavioural approach of which the latter perspective arguably represents a cornerstone of the concept, which in turn

aligns it to the CBV. This distinctive feature of brand orientation is firmly rooted in the strategic management literature on organisational strategic orientations; essentially concerned with categorising and describing the organisational values and priorities affecting specific strategies and tactics (Noble et al., 2002) vis-à-vis the notion of strategic logics. Compatible to the CBV’s systemic view of the firm, as adopted in this thesis for examining corporate brand orientation in empirical settings, strategic orientation is defined as:

“…the dimension of organizational culture that provides the organization's values and priorities in interactions with its marketplace - both customers and competitors - and influences more specific strategies and tactics. The notion of strategic orientation is thus based on the belief that there is a deep, culture- driven characteristic of an organization that influences both the internal processes of that organization as related to marketing and strategic thinking and the strategies that emerge from that organization. Competitive culture should be primarily influenced by long-term management perspectives on the keys to competitive advantage and success in the firm's environment.” (Ibid., p. 27).

Concluding this subsection, the concept of brand orientation may thus be considered a specific organisational competitive culture and interrelated strategic logic (Urde et al., 2013) influencing organisational strategizing, management decision-making in relation to business processes, use of resources and development of distinctive capabilities.

2.3.3. Balancing brand management perspectives: The strategic logic of market orientation

Corporate brand orientation implies an inside-out approach to brand management (Urde, 1999; 2013), which stands in stark contrast to the market orientation concept (e.g. Kohli and Jaworski, 1990; Narver and Slater, 1990). Similar to brand orientation, the concept of market orientation is conceptualised as a distinct organisational culture (Deshpande and Webster, 1989) and an associated set of behaviours (Kohli and Jaworski, 1990; Narver and Slater, 1990). The concept suggests that competitive advantages and long-term profitability are achieved by orienting business processes, resources and capabilities partly around countering strategies of the competition (i.e. competitor orientation) and partly on satisfying the ever shifting needs and wants of all customer segments (i.e. customer orientation). Thus, whereas brand orientation holds that the protection and integrity of brand identity should be the guiding beacon for managing brands and its supporting capabilities, the kernel of market orientation implies for brand management an outside-in capabilities focus (e.g. Day, 1994) on nurturing favourable customer/consumer images by deploying brands to satisfy their every needs and wants (Urde, 1999).

Importantly, brand orientation does not reject the customer orientation precept of market orientation. Firms are indeed to be mindful of customers’ needs and wants and strive to fulfil such market demands. However, honouring the idiosyncrasies of the corporate brand identity;

the core promise and values that form the basis for unique long-term brand-stakeholder relationships, becomes imperative when competing on corporate brands for long-term competitive advantages: “A person - like a brand - who allows himself to by steered by the opinions of others and who constantly adopts whatever position is most popular does not hold our credibility for long. Always being agreeable and avoiding hard decisions is not a

basis for a strong identity - on the contrary.” (Urde, 1999, p. 121). Thus, paradoxically, the inherent logic of opportunism, as implied by a market oriented (outside-in) approach to managing brands, may in the pursuit of relevant brand images convey a weak sense of integrity resulting in disappointing, rather than satisfying, prospective or loyal customers of the brand. In the same spirit Keller discusses how brands should avoid the ‘death-by-1000-cuts syndrome’ as he argues that: “…a decision may be deemed acceptable by some, because even though it may not make good brand sense or enhance brand equity, it is seen as only potentially detracting or taking away from brand equity a little. Over time, however, a repeated number of those seemingly safe decisions can add up, and the brand can suffer significant damage as a whole.” (Keller quoted in Parameswaran, 2012). Thus, serving customers’ needs and wants must take place within the boundaries of the brand identity: “The internal aspect of the brand – the organization – is seen as vital in the brand-building process.

The perspective is from the inside out, while the needs and wants of consumers are

recognized, the integrity of the brand is paramount.“ (Urde et al., 2013, p. 16). Thus, as an important caveat for managing corporate brands as resources, a market oriented culture and behaviour may if too dominant in an organisation pose a long-term threat to the development and sustainment of brand as a viable platform or hub for sustainable growth: “Satisfaction of customer needs and wants: this is what the principle of market orientation very successfully maintains. However, when that becomes a mantra, the brand may morph into an

unconditional response to customer needs and wants, thereby creating difficulties for the consistency and management of brands. In contrast to market orientation, it is possible to see the brand as a resource and a strategic hub of the company.” (Urde et al., 2013, p. 14).

Aligning brand images to the market and significant shifts in customers’ preferences may pose a viable solution short-term while arguably colliding with the long-term viability of brands as resources for implementing value creation strategies. A paradox of embracing

market orientation to satisfy shareholders’ short-term demands thus presents itself in the context of implementing brand oriented strategies for long-term competitiveness and profitability. As vividly put by Schultz and Hatch (2006) the paradox of navigating brand management processes from an inside-out identity-driven (i.e. brand oriented) and outside-in image-driven (i.e. market oriented) approach entails a difficult balancing act between having the organisation conveying either the unfortunate traits of a an ‘arrogant bastard’ (cf.

identity-orientation) or ‘headless chicken’ (cf. market-orientation) (p. 26).

Indeed this paradox or balancing act between identity and market has spawned much debate in the extant brand orientation literature (Urde, 1999; Urde et al., 2013), which pertaining to the present thesis’ portfolio of papers accounts for a pivotal point of departure for much discussion.

Recently, however, this apparent dichotomy of the inside-out brand oriented approach and the outside-in market oriented approach has been subject to a revision by Urde et al (2013) proposing that firms may advantageously embrace hybrid strategic orientations; that is, balancing market demands with the protection of the brand long term by cultivating “…the ability to maintain sound business without violating the brand core identity.” (Ibid., p. 19).

However, research integrating this seemingly contradicting, yet more pragmatic, approach to brand management processes remains empirically unexplored as to how such hybrid strategic orientations are approached by organisational decision-makers and with what consequences to the coordination of resources and development of capabilities. Chapter 8 specifically addresses how brand orientation and market orientation as co-existing institutional logics in organisations manifest themselves in relation to flows of decisions and coordination and allocation of firm resources in relation to firm product design and innovation capabilities.

In the following subsection brand and market logics are discussed in relation to an institutional logics perspective. This subsection focuses on sense and decision-making in

relation to the coordination and allocation of firm resources. Importantly, applying this institutional logics perspective and associated theoretical foundations allows for developing theory on firm co-existence of brand and market oriented (strategic) logics with regards to how they relate to and affect firm capabilities with consideration to the CBV’s four cornerstones (cf. section 2.2.1.).

2.3.4. Brand and market logics: An institutional logics perspective

Corporate brand identity, as defined by firm management, may be influenced by either an inside-out or outside-in approach or in the schism between these two brand management paradigms (Urde et al., 2013). Reflecting this relaxed and arguably more pragmatic approach to the superiority of brand orientation vis-à-vis other strategic orientations (logics) Balmer (2013) notes that: “Whereas a centripetal perspective informs the corporate brand orientation perspective – where the corporate brand serves as an organisation’s key touch-point – some organisations are likely to have a centrifugal corporate branding approach. In this instance, a corporate brand is viewed as one of several, albeit significant, organisational imperatives.”

(Italics added, p. 724.). Consistent with competence-based theory, firms are inclined to devise quite varied and even competing strategic logics for directing and coordinating resources and capabilities to build or sustain firms’ value creating processes pertaining to possibly various strategic goals in relation to their competitive context(s) (Sanchez, 2008).

This being said, the ability of firms to freely exercise such desirable strategic flexibility (Ibid.) and master to devise new or shift between an array of existing strategic logics should be approached with great caution. Reflecting this concern, the CBV includes the dynamic and cognitive cornerstones pointing our attention to the limitations of human cognitive capacities for navigating between the most suitable strategic logics as the dynamics of the competitive context(s) derive both change and uncertainty. However, despite the acknowledgement of

organisational actors’ cognitive limitations, the CBV remains largely impotent in its account of cultural perspectives on organisational sensemaking and decision-making pertaining to strategic logics and their effect on management processes for value creation. Drawing on perspectives from institutional theory provides some useful supporting reflections to overcome this deficiency of the CBV’s largely culturally sterile framework.

From an institutional perspective strategic orientations or logics may over time come to take shape of institutional logics if or when they become so strongly embedded in the organisational culture that they may begin to determine organisational behaviour. For example, Balmer (2013) suggests that a dominant orientation towards corporate brand identities refers to: “…a category of institution where the corporate brand specifically acts as an entity’s cornerstone. It is a centripetal force that informs and guides the organisation. As such, both inherent and espoused corporate brand values/the corporate brand covenant underpins an organisation’s core philosophy and culture. It is also reflected in an entity’s purposes, activities and ethos (its corporate identity).” (pp. 733-734). However, while Balmer (2013) discreetly relates to institutional theory, as he arguably points to how core

philosophies and cultures of organisations form macro-structures (institutions) that shape organisational behaviour (cf. DiMaggio and Powell, 1983), this institutional theory

perspective remains mostly implicit and underdeveloped in the brand orientation literature.

For example, if firms are dominated by a brand logic, as a centripetal organisational philosophy or constraining cultural force, does this imply no room for human action influenced by other institutional logics and secondly, if that is not the case, how would this play out in organisations? With reference to the work undertaken in Chapter 8, the notion that brand orientation may exist as one amongst other organisational strategic logic opens up for new possibilities for examining the suggested synergies between brand orientation and market orientation as co-existing centrifugal rather that centripetal strategic forces (cf.

Balmer, 2013). In relation to how design and innovation management processes are approached, resources deployed and capabilities developed, Chapter 8 draws on recent

developments in neo-institutional theory termed the institutional logics perspective (Thornton et al., 2012). The institutional logics perspective is compatible with the conceptualizations of the market and brand orientation concepts in that these may be explored as simultaneously contradicting and co-existing institutional logics within organisations. From such an institutional logics perspective, brand and market orientation may be described as

respectively concerned with different rationalities and meanings in organisations related to the imperatives of long-term competitiveness and profitability. Compatible with the

supporting and interrelated themes of the brand orientation concept: symbolic interactionism (Blumer, 1969), sense making (Weick, 1995), and the notion of dominant logics affecting attention and decision making (Prahalad and Bettis, 1986), Thornton and Ocasio (2008) define institutional logics as “…the socially constructed, historical patterns of cultural symbols and material practices, including assumptions, values, and beliefs, by which individuals and organizations provide meaning to their daily activity, organize time and space, and provide meaning to social reality.” (p. 101). Thus, as a key principle of the institutional logics perspective, with implications for empirical inquiries on the interplay between brand and market oriented logics, researchers need to consider both the cultural-symbolic-based and material-practice-based aspects of institutional logics. Importantly, these two perspectives reflect one another in the sense that cultural symbols organise practices, which in turn leaves observed practices to reflect organisational assumptions, values and belief as cultural symbols.

Importantly, the institutional logics perspective presents a roadmap for examining the envisioned benefits of managing brands as synergistically informed by organisational brand and market orientation (cf. Urde et al., 2013) as macro-level organisational structures

affecting organisational sensemaking and decision-making through the schemas, identities and strategic goals they each represent; that is, the content and meaning of institutional logics to individuals embedded in them (Thornton and Ocasio, 2008). While acknowledging the constraining effect of institutional (brand or market) logics as associated with notion of embedded agency (DiMaggio and Powell, 1983; Meyer and Rowan, 1977), the institutional logics perspective provides a complex framework for explaining how the co-existence of logics in organisations may not only constrain behaviour, but also provide opportunities for coping with dynamic change in organisations’ environments (Thornton et al., 2012).

Importantly, this institutional logics framework thus supports analytical work on exploring firms’ abilities to comply with environmental changes, and accordingly adapt existing system designs of logics, management processes, resources and capabilities; a central concern within the CBV (Sanchez, 2008; Teece et al., 1997; Teece, 2007). By applying this integrative cross-level analytical approach as suggested by Thornton et al (2013) Chapter 8 presents new insights and contributions to the brand orientation literature from a competence-based

perspective by examining how brand and market orientation as institutional logics (macro-level of analysis) shape organisational agency (micro-(macro-level of analysis).

In the following section, reflecting the systemic cornerstone of the CBV, key theoretical foundations of organisational decision-making theory are discussed reflecting the general concern of this thesis for exploring relationships between corporate brands as logics and the management processes and decisions on the use of firm resources and capability structures for fulfilling strategic goals of the firm.

2.4. Organisational sense and decision making: Implications for brand