(2nd in a series of articles on UnderBranding) – As Michael Hinshaw and I outlined in Smart Customers, Stupid Companies, the disruptive force of Social Influence means that there are almost always countless other people between a company and its customers.
Imagine a jeweler trying to sell an overpriced necklace to a customer while 8,000 people are in the room chanting “Too much, too much!” and you get the idea.
It will only get worse. Customer reviews and recommendations, blogger posts, price comparisons, apps and a range of services we can’t yet imagine will all lessen your company’s ability to use traditional tools (advertising, design, communications, packaging…) to influence customer perceptions.
At the same time, traditional media is fragmenting and fighting for its life.
Now for the good news
UnderBranding is a new way of thinking about brands. It proposes that brands must be linked with the right compensation, culture and conditions at a firm. It also suggests that brands are more important to employees than customers.
Fortunately, it has never been easier for a company to communicate with its own employees. The same forces that are disrupting relationships between companies and their customers – smart wireless devices, apps, pervasive memory – make it possible to communicate in real time with thousands of employees.
Knowledge management portals abound. Firms can customize communications between teams, functional areas and divisions. Using widely available services, they can set triggers that tell people what they really need to know, when they need to know it.
Employees drive your firm
No matter what your industry, employees drive your firm. They make all decisions, large and small. They build the systems that serve customers, they deal with customers, they design and deliver the products. They decide whether to collaborate or compete with each other. They are obsessed with customer needs, or indifferent to them.
In short, your customers are your firm. Your brand tells them how to act.
Your brand says to employees, “I work in a really cool place,” or “We are hopelessly old-fashioned.”
Your brand signals employees to be innovative or reliable, trustworthy or aggressive.
If you target your brand first at employees – and if you synch your company’s culture, conditions and compensation with the brand – then you can change the path your firm follows.
Bigger than marketing
The only way to get your company to act smarter than its competitors – and smart enough for its customers – is to elevate branding all the way to the CEO level.
The head of marketing can’t change compensation systems across your firm, but that is what it takes to synch compensation to your brand promises. Likewise, the CEO and other top executives have to be involved in changing your firm’s culture and working conditions. These three elements must synch with your brand, or your brand is little more than an empty promise.
Branding and customer experience have become critical, CEO-level issues. Now if only CEOs start to recognize this…
YOU MIGHT ALSO LIKE: Part 1 in UnderBranding series
Bruce,
I would like to say straight of the bat that this was a great post and one I will be sharing widely as we share a similar point of view on this topic.
One of my favorite thought leaders when it comes to this topic is Vineet Nayar who is the CEO of HCL. He wrote a powerful book titled “Employees first, Customers second” which beautifully reinforces your point of view. The following is one of my pet quotes that I often refer to when referencing his work:
"We must destroy the concept of the CEO. The notion of the 'visionary,' the 'captain of the ship' is bankrupt. We are telling the employee, 'You are more important than your manager.' Value gets created between the employee and the customer, and management's job is to enable innovation at that interface. To do this, we must kill command-and-control.” Vineet Nayar, HCL
There is no disputing that there are significant tectonic shifts occurring within customer and employee base that all 21st-century enterprises are built around.
The question I have is “does the C-Suite actually realize just how much the impact these changes are having on the management practices they oversee?”?.
Gary Hamel argues elegantly in his book titled “The Future of Management” that the vast majority of enterprise still operate management models that were designed for the 19th/20th Century so that they could manufacture Widgets and manage an unskilled labor-force.
As you point out a lot has changed, sadly the management models/practices haven't. This is where I believe the ability to disrupt exists for those leaders willing to move their enterprises into uncharted territory by embracing and championing change by putting their employees first.
Thanks for sharing this post and I look forward to consuming more juice thought nuggets in the future.
Cheers,
Nicholas Kontopoulos
Nicholas –
Thanks – you got right to the heart of the subject that keeps me up at night: who can decide to do what I have suggested?
Most employees in charge of marketing don’t have the authority to change, for example, compensation across an enterprise. Most CEOs don’t pay intimate attention to marketing, and the metrics that surround it. Thus, you get a situation in which nothing changes.
Michael Hinshaw and I just wrote a book called Smart Customers, Stupid Companies that argues most companies haven’t changed in a decade while customers have embraced smart wireless devices. We also say that a third of Fortune 500 executives are running the next Kodak, but haven’t realized it yet.
I couldn’t agree more with your POV, and appreciate your efforts to get a conversation going here. That’s a great place to begin.
Bruce