LECTURE 6

1. LECTURE 6 Corporate Image and Corporate Reputation: the other realities

2. To understand the importance of perception To understand the key elements of the corporate image and corporate reputation concepts “Model of the Moment”: the family of business related images (see page 176) Objectives

3. “After 2000 years of human progress it seems that the real nature of things remains as inaccessible as it was to Aristotle”LORD SAATCHI THE TIMES LECTURE atWORCESTER COLLEGE,OXFORD UNIVERSITY

4. In business studies CORPORATE IMAGE has been the dominant focus until (in the mid 1990s) greater attention was accorded to the CORPORATE REPUTATION concept. The eminent English economist BOULDING is credited with being the founder of a distinct line of inquiry relating to business images. IMAGE AND REPUTATION

5. Boulding’s Book “The Image” (1956) has been the most influential work on the area. He concluded that there was an a priori link between an individual’s image of an organization and that person’s behavior towards the organization. Boulding’s hypothesis captured the minds of scholars and practitioners of business in the 1950s. BOULDING: PATERFIMILIAS OF CORPORATE IMAGE STUDIES

6. The richness of the concept can be seen in the earlier note on Boulding. However, the concept is problematic owing to its’:multiple meanings negative associations, its difficulty (impossibility) to control, its multiplicity and the different image effect of different stakeholder groups. CORPORATE IMAGE: a rich but problematic concept.

7. TRANSMITTER OF IMAGES(focus on the corporation itself)RECEIVER END IMAGES(image studies as seen from those who are subjected to/hold images)FOCUS OF IMAGE(image of the industry and or country)CONSTRUED IMAGES(beliefs about beliefs-my image of what YOUR image is of thecorporation) Corporate Image: Schools of thought

8. Projected image: creation of a single image Visual image: images created by graphic design and logotype Desired Future image: the wish image (to be held of the organization at some future date) TRANSMITTED IMAGES

9. Transient Image: a fleeting mental picture Corporate Reputation: judgements made about the organization over time Brand user image: the image of the corporate brand that most closely resembles the values of an individual Stereotype image: where shared beliefs are held across different stakeholder groups RECEIVER END CATEGORIES

10. The brand image: perception of the brand in relation to others within the industry (market niche) The industry image: of a sector such as airlines FOCUS OF IMAGE CATEGORIES

11. Construed corporate image: relates to how employees see the organization as ENVISIONED BY another group (senior management) the same concept applies to the other image types previously mentioned CONSTRUED IMAGE CATEGORIES

12. Holding Company Subsidiaries/other corporate service and product brands THE CORPORATION’S IMAGE Industry image Country of origin image …… model of the momentFAMILY OF BUSINESS RELATED IMAGES

13. …..model of the moment THE FAMILY OF BUSINESS RELATED IMAGES HOLDING COMPANY IMAGE(S) OTHER CORPORATE, SERVICE AND PRODUCT BRAND IMAGES THE CORPORATION’S IMAGE(S) INTERNAL ----------------- EXTERNAL INTERNAL ----------------- EXTERNAL INDUSTRY IMAGE(S) COUNTRY-OF-ORIGIN IMAGE(S)

14. The principle difference between corporate image and corporate reputation is that reputations are formed over time. However, as with corporate image, reputations can be good, bad, unwanted, out of date etc CORPORATE REPUTATION EXPLAINED

15. Can give distinctiveness and a competitive advantage can contribute to profits can act as a safeguard in times of adversity The benefits of a positive corporate reputation

16. Balmer argued that the organization’s reputation can act as a standard governing behavior i.e. “Would my actions be in line with the company’s good/bad etc reputation” Can be used by employees, those in recruitment etcHe developed the DEAR principle to explain the above………………………... Reputation as a control mechanism?

17. D= DECISIONSE= EVALUATEDA= AGAINST the R= REPUTATION THE DEAR PRINCIPLE

18. The corporate brand part of an organization (business unit/subsidiary) what an organisation makes as well as how it behaves “I would buy their cars but I would not wish to work for them!” REPUTIONS ALSO APPLY TO..

19. Although a valuable resource (in many instances) a corporate reputation is NO GUARANTEE of business survival or of success. Consider Olivetti which had an enviable reputation as a leading manufacturer of typewriters but took insufficient account of technological developments in the field..Olivetti computers ? Finally……….a word of caution

20. The concepts of image and reputation are laden with different meanings. Perception is important because it effects our behavior (Boulding) Unlike images a reputation is formed over time In considering perceptions held of an organization consideration should also be given to the image/reputation of the industry, country of origin, corporate and product brands, as well as those of its subsidiaries. SUMMARY: i

21. Images and Reputations can be good, bad, wanted, unwanted, deserved, undeserved etc. Reputations may act as an explicit/implicit control device (see the DEAR principle) Reputations, on their own, are no guarantee of success/future business survival. SUMMARY: ii

22. He is quick, thinking in clear images;I am slow, thinking in broken images.He becomes dull, trusting to his clear images;I become sharp, mistrusting my broken images. Robert Graves