Alignment Between Identity and Reputation

Alignment is a cyclic and negotiational process aimed at creating synergy between the goals of a company and the needs of internal and external stakeholders. Consequently, companies need to develop a strategy for aligning their internal communications and human resource management practices with their externally projected values and goals. Alignment not only is a question of communication and (corresponding) actions but also involves the entire organizational culture, which conditions and affects the interactions between all the members of an organization. Alignment is crucial to the formation of long-term relationships with internal and external stakeholders and thus has an impact on sales, internal turnover, and productivity. This entry discusses the process of alignment between identity and reputation and how alignment is measured.

Alignment is a cyclic process because it is based on a continuous communication between management, internal stakeholders (mainly employees), and external stakeholders (mainly customers and suppliers). The process begins when the company defines its strategy (the company’s core mission, values, and direction) and then communicates it to internal and external stakeholders. Next, to determine whether its strategy was communicated clearly and effectively, the company measures how these stakeholders now perceive the company. Corporate identity is the measure of internal stakeholders’ perceptions about the company, and corporate reputation is the measure of external stakeholders’ perceptions about the company. Corporate reputation is often labeled as corporate image; however, whereas corporate image corresponds to more recent and malleable perceptions, corporate reputation is more stable and reflects the condensation of several images over time. After an in-depth evaluation of the results obtained from this analysis, the company tries to align its corporate identity and its corporate reputation by changing its communications and, more generally, its strategy and culture.

Alignment is a process of negotiation because it requires the company to listen to the needs of internal and external stakeholders and act accordingly. Corporate communications are subject to the audience’s interpretation. Thus, to be effective, any communication requires the audience’s cooperation, because such interpretation can be valuable to the company’s alignment process as management seeks to address complaints and criticisms. Companies should also seek to initiate a dialogue with those who criticize it, in order to implement possible constructive changes. Social media are extremely important in determining a company’s success, and a strong alignment strategy can increase the credibility of companies’ communications.

Employees are also fundamental to the alignment process. They are the link between a company’s internal and external environments. As such, they have the power to affect consumers’ perceptions. The ubiquitous nature of technology has so decreased the possibility of sustained competitive advantage that managers must now look for new ways to differentiate their companies and brands. Unique emotional and symbolic characteristics are more important today than functional characteristics, and companies communicate these emotional and symbolic values not only through advertising but also through their employees’ dealings with different stakeholders. Moreover, a strong alignment strategy tends to create less ambiguity and alienation inside the organization, which has a positive impact on employees’ motivation, effectiveness, and turnover.

Finally, note that a company communicates to its internal and external stakeholders even through the sensory perceptions its products or services are able to convey. Thus, a strong alignment strategy should pursue a coherent company-sensory alignment. In other words, companies can convey their messages and their values using subtle and coherent sensory cues, such as colors, sounds, and haptic sensations. These sensory cues should represent the company strategy and be coherent between internal and external stakeholders.

How to Measure Alignment

The research literature has suggested very few validated tools to measure and check for corporate alignment. The general practice is to use a unique questionnaire (with the same items) and to administer it to both internal and external stakeholders. The data collected from the internal stakeholders supposedly represent the corporate identity, whereas the data from the external stakeholders supposedly represent the corporate image or reputation. Finally, this process allows researchers to identify whether different groups of stakeholders evaluate each item (or factor) in a significantly different way. The more similar the evaluations are between different groups of stakeholders, the more aligned the organization supposedly is. Conversely, each significant discrepancy represents an area of misalignment.

This approach has gained some success because of its simplicity and straightforwardness. However, it has several major flaws. First, using the same questionnaire to measure corporate identity as well as image or reputation is an oversimplification. Corporate identity is different from corporate image or corporate reputation; they are not symmetrical. Therefore, they cannot be measured using the same questionnaire. Two different and more specific surveys are necessary. Second, a perfect alignment between reputation and identity is not always ideal. What might satisfy the customers and the external stakeholders might not satisfy the internal stakeholders. Thus, management should have a less mechanical approach in evaluating the discrepancies between identity and reputation, considering them area by area. In addition, when testing for alignment, measuring (internal and external) stakeholders’ satisfaction is useful. In this way, it is possible to understand which items and factors are more correlated with satisfaction and dissatisfaction and to focus the alignment strategy on the most critical elements.

On a final note, even if questionnaires are the most used and tested methods to measure corporate image, reputation, and identity, they often measure the most conscious and verbal aspects of these constructs. They may also suffer from social desirability biases, especially when employees are surveyed. Thus, for an optimal alignment strategy, qualitative methods would also be useful in testing corporate identity and reputation. These methods could include focus groups, Kelly Repertory Grids, laddering, phenomenological interviews, and projective techniques. Focus groups consist of people who are asked about their opinions about the company. The Kelly Repertory Grid and laddering techniques are utilized to elicit constructs and attributes that people use to categorize and discriminate between different companies. Phenomenological interviews are first-person descriptions of participants’ experiences in ecologically relevant situations. In projective techniques, respondents are asked to freely interpret some ambiguous stimuli related to the company; the assumption is that respondents “project” their own unconscious feelings and motivations into their responses.