The hallmark of a transformational company is the ability to harness the collective power of its intangible assets – culture, brand and reputation – to better compete, grow and earn higher market value. Such companies intuitively recognize the power of managing their assets in a holistic manner, for the greater good of the company.
Just as the lines of demarcation between marketing and communications have blurred, so have the lines between workplace and marketplace. The new game is now being played like a three-dimensional chess match. Here’s why:
In the face of disruption, intangible assets are the differentiators.
Intangible assets have always been drivers of corporate performance to some degree, but in the face of disruption, they are being recognized as being even more important. Case in point is that today’s market values intangible assets. A recent survey of institutional investors revealed that 35 percent of their investment criteria had nothing to do with financials or market performance. Instead the focus is: corporate culture, leadership, governance, innovation, quality of products/services, environmental and community issues, reputation and brand equity.
If we take a look at the industrial economy, valuing assets used to be considerably different to what it is today. Hard assets like inventory were quantifiable and the worth of factories could be determined. In today’s economy – that’s based on assets like innovation, knowledge, talent, R&D corporate culture and social responsibility – intangible assets count more than ever, especially when they get dialed into the “goodwill” bucket in a balance sheet.
The siloed approach to brand, reputation and culture is outdated.
The traditional approach of putting brand, reputation and corporate culture in their own swim lanes, each focused on their narrowly defined constituencies, channels, deliverables, consultants and analytics, is now suboptimal. In a world of rapid-fire information exchange, a complicated geo-political and social environment, and hyper-personalized customer needs, following a brand-centric marketing strategy is simply not enough.
Legacy issues and turf battles have a propensity to inhibit this new approach. It’s unsettling and risky for most executives to give up control and get out of their comfort zone to play three-dimensional chess with their peers unless they are facing a crisis or a clear transformational edict from the top. Another challenge is a lack of understanding or confusion about the interplay between culture, reputation and brand. Let’s explore this a bit further:
- Brand and reputation management are two distinct, yet complementary disciplines. Some people confuse the two, or they may have different ideas of what they mean and how they intersect.
- Brand is managed through products and services, images, ads and collateral. It’s the real experiences or perceptions customers have about the quality of a company’s products and service.
- Reputation on the other hand is managed through one thing: people. Reputation speaks to the character and conduct of a company, it captures the behavior, the values and the decisions of each and every employee every day that bring the brand to life.
- Reputation gauges the perceptions of multiple stakeholders. While brand mainly gauges customer perceptions and attitudes.
- Corporate culture serves as the connective tissue between brand and reputation. It is the glue that makes everything click. It’s hard to have a strong brand if you have a weak reputation, and conversely, it’s hard to have a strong culture without a strong brand.
Transformational companies understand the strategic importance of managing these intangible assets collectively. They make a conscious effort at the highest levels to align strategies, programs, audiences, channels and research across marketing, communications and even HR to develop a project management system that optimizes results with accountability and common metrics. Leaders who understand this “workplace to marketplace” concept also adopt enterprise-wide common objectives between marketing and communications, instead of bifurcated programming. They embrace a formula where the “whole is greater than the sum of the parts.”
The more successful you are in operating brand, reputation and corporate culture in tandem, the more likely people are to:
- Buy your products and services
- Want to work for you
- Recommend you to a friend
- Trust you
- Give you the benefit of the doubt in a crisis
- Want to Invest in your business
Knowing what drives intangible assets and being able to effectively execute a “workplace to marketplace” strategy to strengthen them can propel companies to greater heights. Your customers view your brand, reputation and corporate culture as a single entity rather than as separate parts of your organization. Do you?
Learn more about how marketing, communications and HR can collaborate to strengthen a company’s intangible assets, get in touch today.