Corporate brand orientation and the competence-based view

Scholars have so far failed to stand on common grounds as to which brand(s) the concept of brand orientation is oriented towards as well as to whether a focus should be placed on organisational behaviours or culture as determinants of firms’ degree of brand orientation.

Thus, a clarification of the brand orientation concept as it relates to corporate brands is much needed. As noted by Balmer (2013) the concept of brand orientation as outlined by Urde (1994; 1999) holds great potential to be explicitly applied and developed in relation to corporate brands. On that note, and of great relevance to this thesis, recent advances have been made in order to extend the concept of brand orientation into the domain of corporate brand strategies (See the special issue on ‘Corporate brand management – A leadership perspective’ in Journal of Brand Management, Vol. 20 No. 9 – Chapter 6 contributes to this special issue). In their explicit examinations of corporate brand orientation Balmer (2013) and Urde (2013) flesh out compatible views on a strategic orientation towards corporate brand identities and the elements constituting the corporate brand identity construct, which has been subject to much confusion in the literature (Urde, 2013).

Importantly, the widespread notion that corporate branding implies a broad multiple stakeholder perspective is critical to distinguish between corporate brand orientation, omni-brand orientation (Brïdson and Evans, 2004; Urde, 1994), service or product omni-brand

orientations, with the latter being dominated by a customer stakeholder focus (Balmer, 2013).

Seeking to brand or market an entire organisation and thus everything the organisation does, stands for, exists of and for, has induced several tenets of corporate branding concerned with management of the multiple identities of the organisation (Balmer, 2008). In order to move towards a definition of corporate brand orientation Balmer (2013) draws on the interrelated literatures on corporate branding, corporate marketing and corporate brand identification in which an emphasis is placed on the imperative of managing altogether the various corporate-level elements of corporate identity (Balmer, 2008); corporate brand (Balmer and Greyser, 2003); organisational identity (Albert and Whetten, 1985); total corporate communications (Balmer, 2001a) and the corporate reputation and image (Hatch and Schultz, 2001). Urde (2013) suggests that corporate brand identity is formed through a combination of external and internal elements. Presenting his Corporate Brand Identity Matrix (see below Figure 2, page 27), Urde (2013) argues that in brand-oriented firms the: mission and vision (cf. corporate identity), organisational culture and deeply held values and beliefs in the organisation (cf.

organisational identity), and competences constitute the primary driving forces informing inside-out the corporate brand identity.

In their totality these internal identity elements of the organisation come to constitute a set of core values, which as a meaningful whole summarises the corporate brand identity as a promise between the organisation and importantly all its stakeholders on what to expect from engaging in a relationship with the corporate brand (Balmer, 2013; Balmer and Gray, 2003;

Urde, 2009).

Figure 2: The Corporate Brand Identity Matrix (Adopted from Urde (2013)).

In other words, at the core of the corporate brand identity a promise based on organisational values describes the essence of who the organisation is, what it stands for and is capable of (Grant, 1991). This brand core may inform the organisation outside-in how to manage external dimensions of the corporate brand identity; how the brand is to be positioned in the market vis-à-vis competition; how stakeholders (consumers or other firms) should perceive of the brand’s value proposition(s); and, the ways in which such stakeholders may mirror

themselves in the corporation to assist them in their own corporate, professional and personal identity projects (Belk, 1988; Helm and Jones, 2010; Kapferer, 2012; Vallaster and von Wallpach, 2013). In order to bridge the internal and external identity elements the corporate brand identity may be further elaborated by providing it with personality traits for how to express the corporate brand identity (cf. total corporate communications). However, Urde (2013) does not elaborate on the processes as to how the corporate brand’s identity is

Core:

Promise and core values

Value propositions Relationships Position

Expression Personality

Competences Culture

Mission &Vision

InternalInternal/ExternalExternal

expressed through visual identity programs (Olins, 1989) or product designs. This leaves the question of what goes on in the black-box between strategically defined core brand values and promises and the actual organisational processes that (favourably) lead to ‘on-brand’

expressions? To shed light on this question this thesis empirically examines and suggests ways in which organizational brand expressions become the embodiment of identities across internal and external elements of the corporate brand identity matrix (Urde, 2013). Central to this approach is to examine how design and innovation management processes (See Part 2) as flows of decisions and uses of resources and knowledge are affected by corporate brand identities as management logics; a focus largely absent in the (corporate) brand orientation literature. This gap is examined in Chapters 6, 7 and 8 in which design innovation

management business processes, structures and decisions in relation to the focal case companies’ corporate brand identities form important units of analysis.

The corporate branding literature takes its departure in marketing thought emphasising consistent communication of the corporate brand promise over time and space; internally to achieve organisational-wide understanding of and commitment to the corporate brand (Vallaster and de Chernatony, 2006) and externally to differentiate the organisations in the market place (e.g. Balmer, 2001b; Balmer and Greyser, 2003). However, while neither neglecting nor reducing the importance of this dominant marketing-communication logic, the main precept of the brand orientation concept stresses that organisations must transcend brand communications and embrace a systemic and introspective orientation towards organisational culture and the management decision-making, business processes and

structures as an intrinsic part of (corporate) brand management (e.g. Urde, 1999). This focus is grounded in the view that the long-term viability of competing on brands depends on the firm’s ability to actually deliver on what it promises through its brand communications (Ibid.). Such brand delivery is based on the application of capabilities (Helm & Jones, 2010).

However, whether emphasis is placed on managing total corporate communications or product design and innovation, the literatures unanimously emphasise (corporate) brand identities as centripetal cultural forces that may strategically inform and guide organisational behaviours, decisions, communications, designs et cetera (Balmer, 2001a; 2012; 2013; Evans et al., 2012; Urde, 1999; 2003; 2013; Urde et al., 2013)

2.2.1. Alignment of brand orientation to the four cornerstones of the competence-based view

As suggested by Sanchez and Heene (1996; 2004) the competence-based view (henceforth CBV) builds on four cornerstones, which are widely supported in the competence-based literature (Eisenhardt and Martin, 2000; Freiling et al., 2008; Kwee et al., 2008; Teece, 2007).

Firstly, the systemic cornerstone reflects a view that firms’ value-creating activities should be approached as a system of interaction between firm strategies, management processes, resources, markets and environmental and competitive contexts.

Secondly, the dynamic cornerstone views the market contexts of firms as ever changing (with rare exceptions).

Thirdly, the holistic cornerstone focuses our attention to the imperative of continuously enhancing firm capabilities to attract and retain the best (firm-subjective) resources in order to support its value-creation strategies and processes.

Lastly, the cognitive cornerstone reminds us of managers’ cognitive limitations, which may pose severe issues when confronted by uncertainties of environmental contingencies. Such changes call for management cognitive flexibility in terms of how to design the deployment of firm resources and capabilities to meet changing goals of the firm in relation to the dynamics of the market.

In presenting the following synthesised views of corporate brand orientation and the CBV’s four cornerstones explicit references to Chapters 5, 6, 7 and 8 are continuously made to initially highlight contributions of the thesis to the (corporate) brand orientation literature from a competence-based theory perspective.

Systemic view of the firm – Corporate brand orientation emphasises the corporate brand promise and values as a strategic logic, which informs managers on how to interrelate and coordinate firm resources as a capability for effectively deploying its resources for value-creating processes (e.g. product innovation) in support of the corporate brand’s core values and promise. This systemic cornerstone of competence-based research is reflected across all three empirical papers of the thesis (Chapters 6, 7 and 8) by emphasising that brands, as any other firm resource, are not capable of creating value on their own, but from a product innovation perspective must be “interrelated and coordinated with other resources to achieve coherent processes that are capable of creating and producing successful product for

markets.” (Sanchez, 2008, p. 43). Thus, with strong ties to the strategic (marketing) management literature, as concerned with resources and capabilities for competitive

advantage (Day, 1994), the concept of corporate brand orientation is implicitly promoted as a strategic logic of the firm, which deploys the corporate brand identity as an “…operative rationale for achieving its goals through coordinated deployments of resources and capabilities.” (Sanchez, 2008, p. 44).

Dynamic view on markets – Corporate brand orientation emphasises that the management of corporate brands and supporting management decisions and processes must occur in an on-going interaction with the market and stakeholders (Jones, 2005; Merz et al., 2009; Urde, 2013). This dynamic management perspective aligns corporate brand orientation to the

presumption of the competence perspective that the world of organisations, markets and competition is (usually) ever changing (Eisenhardt and Martin, 2000; Teece, 2007).

This dynamic cornerstone of competence-based research is explicitly reflected in Chapters 5, 6 and 8 in which the role of design and innovation capabilities for coping with rapid changing business environments and markets are discussed as prerequisites for sustaining competitive advantages and strong brands. Chapter 6, for instance, addresses the imperative of resource orientation, which it discusses as a vital component for implementing sustainable strategies; that is, firms must be mindful of the uncertainty of future market conditions and thus the resource availabilities of the firm to counter such uncertainties.

Holistic approach to resource markets – The corporate brand orientation emphasis on applying a multiple stakeholder focus and interaction (Balmer, 2013) aligns to the holistic cornerstone of the competence-based perspective, which holds that firms, in order to build and sustain value creating processes, must seek to attract and retain the best firm-addressable resources (e.g. internal or external stakeholder relationships) and continuously improve its management processes to become more effective in doing so (Sanchez, 2008; Teece, 2007).

This holistic cornerstone, stressing the strategic importance of competing in resource

markets to sustain value-creating processes, forms the central topic of Chapter 7. This chapter explores how firm managers, informed by their corporate brand identities as a strategic logic for guiding processes around product designs, approach their interaction and attraction of firm-addressable external designers in the local and global design communities (i.e. resource markets). Thus, aligned to the CBV’s interest in understanding the effectiveness of different strategic logics in accessing, coordinating and focusing attention on available and useful value creation resources, this chapter provides insights into these matters from a strategic

brand logic perspective.

Cognitive limitations of managers – Corporate brand orientation reflects an organisational culturally embedded mind-set (Urde et al., 2013), which implies the protection of the

corporate brand identity as a dominant strategic logic with firm managers; vis-à-vis a firm’s operative rationale. As emphasised by Sanchez and Heene (1996) the CBV takes into

account the limitations of human cognitive capacities when faced with novel issues triggered by the dynamic change of markets and competitive interactions and argue that firm

competitive advantages are found in their intellectual capacity to deploy the right strategic logic for coordinating resources and create value in relation to achieving their goals in a given competitive context.

This cognitive cornerstone forms the central topic of Chapter 8 in which the strategic logic of corporate brand identity is examined in relation to a market oriented logic in order to explore management processes and use of firm resources within the empirical context of product design and innovation.

The cognitive cornerstone forces one to consider a cultural perspective in relation to what organisational decision-makers know and what they want and how these elements unfold with consequences for how firm competitiveness evolves (e.g. Freiling 2004; Freiling et al., 2008). In this regard this thesis applies a cultural perspective to understand organisational behaviour and explain flows of decisions pertaining to management processes and the

deployment and coordination of firm resources and capabilities for achieving the goals of the organisation. In line with this approach the interrelated cultural and behavioural perspectives on the (corporate) brand orientation concept are discussed while explicating implicit relations to the CBV. As a central supporting theme within the literature on brand orientation, the

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.