StrategiCom's Journal of Brand Strategy

The Corporate Identity:

When Do You Change It?
By Lesley Tian, Research Analyst, StrategiCom

BrandBank • MARCH 2010 issue

BrandBank • MARCH 2010 issue

The Corporate Identity:

When Do You Change It?
By Lesley Tian, Research Analyst, StrategiCom
March 2010

The Corporate Identity – An Introduction

In today’s business environment, firms are
constantly seeking ways to stay relevant
with market trends while coping with latest
developments. While staying current with the
business trends within their industries might
give a company a competitive advantage
over others, the adoption process could be
painful. Every now and then, management
has to take the organisation through radical
changes such as developing a new business
model, entering into new business territory
or merging with another company, just
to prepare for their desired future and the
opportunities which may follow.
History reveals that while some revolutions
have succeeded, others have failed. For
example, Xerox, despite the huge amount
of investment in technology acquisitions and
their globally renowned Palo Alto Research
Center (PARC), is still highly associated with
copiers1 rather than other digital products.
In contrast, Sony Ericsson created a new
category through the effective integration of
the mobile phone and a music player. In
2006, the company enjoyed a net profit
of €143 millions, a 91% increase from the
previous year. The Walkman branded line
of mobile phones contributed to a quarter
of the shipment2. This difference is because
different companies have different adoptive
capacities.
Whether a firm can completely implement a
particular technology or promptly tap upon
a certain market trend depends on many
factors. Past studies have identified factors
such as brand/line extension3, organisational
sunk costs4, corporate core competence5,
and structural inertia6, among many others
that contribute to a company’s adoptive
capacity. While literature explanations are
fair, one of the lesser mentioned factors is
a firm’s corporate identity (“CI”). A firm’s
CI, when managed properly, can be a
fundamental contributor of a firm’s current
and future adoptive capacity.

1
As obtained from: http://brandfailures.blogspot.com/2006/12/brand-extension-failures-xerox-data.html
2
As obtained from: http://www.mobiletracker.net/archives/2006/07/13/sony-ericsson-q2-2006 in March 2010.
3
Ries and Trout, “Positioning: The Battle for Your Mind”, 1981, New York.
4
G. B. Northcraft and G. Wolf, “Dollars, Sense and Sunk Costs:A Life-Cycle Model of Resource-Allocation Decisions,” Academy of Management Review 9, no.
2 (1984): Pp 225-234
5
D. Leonard-Barton, “Core Capabilities and Core Rigidities; A Paradox in Managing New Product Development,” Strategic Management Journal 13 (summer
1992): Pp 111-126
6
M.T. Hannan and J. Freeman, “Structural Inertia and Organizational Change.” American Sociological Review 49, no. 2 (1984): Pp 149-164

01
BrandBank • MARCH 2010 issue

Benefits of The Corporate Identity: The Growth & Expansion Impact

The firm’s CI is a powerful concept7. Research
has shown that it shapes the the views of
members in an organisation on corporate
issues8, and even their personal identity9. For
example, a man from a welding company is
likely to develop his sense of self as a welder.
When the welding company develops an
identity anchored in safety, he tends to pay
more attention to the use of new welding
technology, proper personal protective wear
and best-in-class safety practices rather than
energy sources or weld-ability in different
environments.
One of the most important benefits of a CI
is probably the ability to serve as a business
acceptability indicator for a company i.e. to
gauge how far a company can stretch its
operations to take on the demands in terms
of customers’ needs and changes, while still
being perceived as relevant and competitive.
As Porras and Collins argued, “organisations
cannot endure without developing a
solid core from which they can confront a
changing and often hostile environment”10.
As a case in point, Ace Dynamics Ltd (a publicly
listed company in Singapore) was known as
a diversified company involved in the supply
of welding equipment and consumables,
safety equipment and property development
for almost 30 years in Singapore and the
region. In 2006, its Chief Executive Officer,
Steven Tham, realised that with the rapid
growth in the offshore & marine construction
and engineering sector, a greater focus
in their welding, safety and welding gas
business was needed. Since Ace Dynamics
was also known for its involvement in the
property sector, Tham sought the support of
his board to change the CI of Ace Dynamics
(since the name formed a large visual part of
the company’s CI). In this case, it was clear
to Tham that the CI was a hindrance to the
board’s strategy in growing the business of
welding, gas and safety in a focused way.

The Relevance of the CI to Corporate Strategy: Asking The Right Questions

Here are some salient questions that a
management of a company and its board
should ask when evaluating the relevance
of corporate identities. A good guide is to
work from the bottom up:-
- What is the CI of my organisation?
- Is the CI of my organisation well-recognised
and if so, what is it recognised for?
- Is the CI relevant to my stakeholders in
the context of the strategic intent of the
company?
- If not, what steps should be taken?
- What is the impact in terms of change
management?
For business leaders who are sensitive
about their organisations’ CI, a good
tool which can help to better understand
and measure a CI is known as a CI
audit11. For companies, especially the
ones that failed to realise performance
improvements despite their continuous
efforts to solve operational or strategic
issues, a periodic CI audit may prove to
be useful in assessing the company’s core
problem(s)12. In the case of Ace Dynamics,
a CI audit was commissioned by the CEO
who took a personal involvement in the
audit; something rarely seen in most
CEOs.

7
Hamid Couchikhi and John R. Kimberly, “Escaping The Identity Trap”, MIT Slogan Management Review, Spring, 2003, Pp20-26.
8
J.E. Dutton, J.M. Dukerich and C.V. Harquail. “Organizational mages and Member Identification.” Administrative cience Ouarterly 39 (June 1994): Pp 239-
263.
9
B.E. Ashforth and F Mael, “Social Identity Theory and the Organization,” Academy of Management Review 14 (January 1989): Pp 20-39.
10
J.L.Porras, and J.C.Collins, “Built To Last: Successful Habits of Visionary Companies”, New York, HarperCollins, 1994.
11
“The Soul of the Corporation: Managing Your Company’s Identity”, December 06, 2007 in Knowledge@Wharton.
12
Hamid Couchikhi and John R. Kimberly, “Escaping The Identity Trap”, MIT Slogan Management Review, Spring, 2003, Pp20-26.

02
BrandBank • MARCH 2010 issue

Know The CI & Do More With It

Similar to a financial audit, which is to add
credibility to the implied assertion by an
organisation’s management that its financial
statements fairly represent the position and
performance to the firm’s stakeholders13; a
company should not be convinced that its
current CI is a reasonable representation
of its desired position without a logical
and systematic audit. While conducting it
on an annual basis may not be necessary,
a periodic CI audit is essential since a
company’s product and service range may
be changed to suit the needs of the market
from time to time. Conventional wisdom
should be the trigger as to when a CI audit
is necessary. But when it is commissioned,
a structured process is needed. This paper
provides the salient steps any management
should consider when commissioning or
administering a CI audit.

Step 1: Know the Current Situation of the CI

CI, as a modern management concept,
has made three main developments in
the past three decades. In the seventies,
CIs were synonymous with organisational
visual identifications. Great importance
was assigned to the graphical aspects by
practitioners then14. One of the more notable
of scholars was Olins, whose renowned work
was found in the classification of CIs namely:
monolithic, endorsed and branded15. In the
late 1980’s, both graphic designers and
marketers realised the difficulty in projecting
a cohesive image as modern organisations
had to contend with different stakeholder
groups. Bernstein, among others, argued
the necessity of ensuring visual consistency
in a firm’s marketing communication efforts16.
In the 1990’s, scholars like Balmer argued
that the CI is rooted in the behaviors of the
members of the firm17, and this forms the
unique characteristics of the organisation.
Gradually, the definition of the CI has
expanded to include different components.
Today, there is no consensus on the definite
definition of a CI18, however it is commonly
understood that an organisation’s identity
is revealed through members’ behaviours
and communications, as well as through
symbolism to internal and external audiences.
In the case of Ace Dynamics, all three of the
following interconnected components were
included in its CI audit exercise.
1) Symbolism: to reveal some of the
basic traits of an organisation’s identity by
interpreting organisational symbolism19
such as logotypes, corporate signatures,
typestyles, formats and colours. Here, the Ace
Dynamics mark was found not to symbolise
any pertinent association to its various diverse
business. Put simply, stakeholders knew that
it was a public listed company but few could
associate the company to its various natures
of businesses.
2) Integrated marketing and communication:
to ascertain an organisation’s external
marketing and communication efforts20
through a heuristic analysis. This examines
the organisations’ historical roots and its
current areas of internal conflicts21. Ace
Dynamics’ marketing efforts in the last 10
years (before its CI change) were diverse
since the business as a whole was diversified.
There was an obvious conflict between what
was communicated historically vis-à-vis the
company’s new strategic intent.

13
Obtained from http://en.wikipedia.org/wiki/Financial_audit, as at March 2010.
14
Cees B.M. van Riel, John M.T. Balmer, “Corporate Identity: the Concept, its Measurement and Management”, European Journal of Marketing (2007), 31, 5/6:
Pp340-355
15
Olins, 1978, “The Corporate Personality: An Inquiry Into The Nature Of Corporate Identity”, Thames and Hudson, London.
16
Bernstein, 1986, “Company Image and Reality: A Critique of Corporate Communication”, Holt, Rinehart and Winston, Eastbourne, UK.
17
Balmer, 1995, “Corporate Identity: the Power and the Paradox”, Design Management Journal, Winter, pp.39-44
18
International Corporate Identity Group (ICIG) decided not to give a definition of corporate identity but rather a statement which articulates the multidisciplinary
nature of the area and its difference from brand management. “Strathclyde Statement”, Feb 1995.
19
Napoles, V. (1998), Corporate Identity Design, Van Nostrand Reinhold Company, New York, NY.
20
Gray, E.R. and Smeltzer, L.R. (1985), “Corporate Image – An Internal Part of Strategy”, Sloan Management Review, Summer, Pp73-77.
21
Cees B.M. van Riel, John M.T. Balmer, “Corporate Identity: the Concept, its Measurement and Management”, European Journal of Marketing (2007), 31, 5/6:
Pp340-355

03
BrandBank • MARCH 2010 issue

3) Members behaviour: to assess members’ examinations of documentaries (figure 4.1).

behaviors within an organisation. Here,
qualitative methods were often adopted. Van
Rekom proposed the laddering technique22
which relies on means-end interviews to
reveal the dominant values of employees.
Balmer proposed the “Balmer’s Affinity
Audit (BAA)”23 which relies on collecting data
through various qualitative methods such as
semi-structured interviews, observation and
The laddering approach was adopted for
Ace Dynamics and it revealed that most staff
only knew what their division was doing as
opposed to what the company was involved
in as a whole. This presented challenging
issues since the strategy was to consolidate
the welding, gas and safety business; and a
discontinuance of non-core businesses,

Figure 4.1.: Conceptual Model Based on Balmer’s Affinity Audit (BAA)

22
As referred in: Cees B.M. van Riel, John M.T. Balmer, “Corporate Identity: the Concept, its Measurement and Management”, European Journal of Marketing
(2007), 31, 5/6: Pp340-355
23
Balmar, J.M.T, (1996), “The Nature of Corporate Identity: An Explanatory Study Undertaken Within BBC Scotland”, PhD thesis, University of Strathclyde,
Glasgow, UK.

04
BrandBank • MARCH 2010 issue

Step 2: Determine the Desired Corporate Identity

An organisation is constantly subjected
to changes especially in its products and
services and hence, it is advisable to
periodically assess the degree of fit between
the company’s identity and its strategy going
forward. For Ace Dynamics, the company
decided to change its corporate name to
Leeden and with it, its CI. CEO Tham realised
that its new CI would fail without a well-spelt
out corporate strategy. In other words, the
vision of Leeden as “The Integration Specialist
for Welding, Gas & Safety” was aligned to its
CI (Figure 4.2).

Figure 4.2: Leeden’s Logo and Tagline

To ensure that a CI is aligned to the firm’s

corporate strategy, a variety of methods can
be used:

1) The IDU method: Introduced by Rossiter
and Percy24, it aims to discover three important
pieces of information- the benefits that are
perceived by key external stakeholders as
important (“I”), the ones that are delivered
by the organisations (“D”) and finally those
that are perceived as unique, or better (“U”)
when compared to other organisations in
the same category (Figure 4.3).

24
Rossiter, J.R. and Percy L. (1997), “Avertising & Promotion Management”, McGraw-Hill, New York.

05
BrandBank • MARCH 2010 issue

Figure 4.3: The IDU Method Example based on Rossiter and Percy, 1982.

2) Bernstein’s Spiderweb25: Generally, an conversations with key participants

external consultant leads this process. It represented at every level and department.
begins with a focus group conducted with This approach aims to generate in a
the firm’s top management. Key attributes representation the salient attributes of the
are extracted and verified within stimulating corporate identity. (Figure 4.4)

Figure 4.4: Bernstein’s Spiderweb Method Example

25
Bernstein, 1986, “Company Image and Reality: A Critique of Corporate Communication”, Holt, Rinehart and Winston, Eastbourne, UK.

06
BrandBank • MARCH 2010 issue

Within StrategiCom’s methodology, there corporate identity, namely “relevance” and

are two things which the firm’s consultants “desirability” of the corporate identity:
look out for when determining the desired

1) Relevance: The characteristics of the 2) Desirability: Within the iterative process of

desired corporate identity must be relevant.
In Leeden’s case, the lead consultant
tested the new trademark with key players
within Leeden’s key customer markets.
“Integration” of Leeden’s three business units
of welding, gas and safety was an important
characteristic for the communication of the
business through the newly designed mark.
Feedback and comments served to evolve
the mark to its final accepted stage.
crafting Leeden’s trademark, key customers’
markets were studied to ensure that
appropriate colours and symbols were used.
However, the search for desirable attributes
has to be highly related to the organisation’s
current situation and again, comments were
derived from the marketplace.

Step 3: Convergence Study

A clearly defined CI will only become a - “Are the internal and external perceptions
source of competitive advantage when of our CI aligned?”
there is convergence both internally and
- “Are there internal or external signals
externally26. This convergence acts as a
that reflect our CI as blinding us to market
force for bringing people together around a
changes?”
central mission. Therefore, a convergence
study is necessary. - “Which stakeholder group would be
anxious or threatened by a CI change?”
The following are some of the key - “Which stakeholder group would be better
questions organisations should ask during served by a change in our CI?”
a convergence study:
- “Is there internal congruence on the
perception of our CI?”
- “Are we satisfied with the amount of
convergence around our identity?”

26
Hamid Bouchikhi, John Kimberly, (2007), “The Soul of the Corporation – How to Manage the Identity of Your Company”, Wharton School Publishing.

07
BrandBank • MARCH 2010 issue

So You Now Know…So What?

A comprehensive CI audit will indicate if
change is necessary. Generally, there are
two situations when organisations do not
need a CI change. First, when the CI is
strong and relevant. Secondly, when the CI
is not desired by the firm, but perceived to
be strong according to other stakeholders.
With such audit results, relevance rather
than change is what needs to be brought to
the current CI.
However, once the audit shows that the
current CI is weak and undesirable, change
is essential. Companies who need to
revamp their current CIs have two options:
evolutionary change and revolutionary
change27.
Evolutionary change refers to a process
during which the CI change is a by-product of
successive strategic and operational changes
over a long period of time. Shell (Figure 4.5)
alters the shape, color, and typography of its
symbol to keep it up to date. But the basic
elements have been around for almost one
century.

Figure 4.5: Evolutionary Changes of Shell Logo

By contrast, a revolutionary change usually
begins with a swift transformation of the
company’s identity and then proceeds with
realignment of strategy and operations. The
creation of a global giant GlaxoSmithKine
took place in the year of 2000. Today,
the world’s second largest pharmaceutical
company (by employees)28 boasts a wider
portfolio of pharmaceutical products than
ever.

Figure 4.6: Revolutionary Changes of GlaxoSmithKine (GSK)





27
Hamid Couchikhi and John R. Kimberly, “Escaping The Identity Trap”, MIT Slogan Management Review, Spring, 2003, Pp20-26.
28
As obtained from http://www.medibix.com/company.jsp?company_id=9992466 in May 2010.

08
BrandBank • MARCH 2010 issue

Conclusion: Changing The CI means

Change Management

Whichever way an organisation qualities of CEOs form only part of

chooses to carry out its identity the story29. In order to facilitate the
change, the process is normally transformation of an organisation’s
painful. Inevitably, resistance will identity, management must be
be felt and change management willing to accept changes, including
needs to be implemented. It takes changes to the management
more than mere political skills for itself. By so doing, they can help
corporate leaders to preempt and internal and external stakeholders
overcome resistance. cope with the identity crisis as an
expected event in a well-prepared
One of the most powerful women environment.
Lesley Tian’s keen interest in in business, Carly Fiorina, probably
organisation and community underestimated how deeply rooted Hence, before any business owner
cultural patterns is reflected in her Hewlett Packard’s (“HP”) identity or corporate leader ever decides to
firm understanding of geographical was in the core values, and hence undertake a CI change; there should
and cultural differences of various did not anticipate the hostile be serious consideration followed
countries, and her research interest reaction of influential members of by the will to take bold initiatives
lies in the branding of companies in the HP families when it came to the to assess congruency between the
the context of different cultures and merger with Compaq. Her leaving CI and the firm’s business strategy
languages. Her skills were utilized in after the fight with HP’s board in before these two critical components
a research study on green energy with 2005 indicates that the personal drift too far apart.
Professor Gerhard Apfelthaler during
her stay in Austria. Lesley interned
with StrategiCom in 2007 and 2008
and joined the firm full-time in 2009
where she worked on clients such as
Swee Hong Construction Engineering,
Marshal Technology and Hu Lee
Impex.
l e s l ey. t i a n @ s t ra t e g i c o m . c o m

29
“Ignoring Your Corporate Identity Can Sabotage Strategic Change”, May 21, 2003 in Knowledge@
Wharton.

about strategicom
StrategiCom is a global B2B brand strategy consulting firm headquartered in Singapore with 11 offices and 110 consultants & researchers
around the world. The industries it serves include Information Technology, Oil & Gas, Petrochemicals, Commodities Trading, Business Services,
Pharmaceutical, Medical & Healthcare, Transport & Logistics, Construction & Real Estate, Precision Engineering and Electronics Manufacturing.
StrategiCom’s consultants, researchers and proprietary methodologies provide the catalyst for companies to transform from traditional
businesses into differentiated brands.

contact us
StrategiCom Pte Ltd 371 Beach Road #19-08 , The KeyPoint , Singapore 199597
Tel: (+65) 6220-2216 Fax: (+65) 6220-2116 Email: publication@strategicom.com

© Dec 2009 StrategiCom Pte Ltd. All rights reserved. Published by StrategiCom Pte Ltd.
An imprint of StrategiCom Pte Ltd: 371 Beach Road, #19-08, The KeyPoint, Singapore 199597.
No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior
permission of the copyright owner. Request for permission should be addressed to the Publisher, StrategiCom Pte Ltd, 371 Beach Road, #19-08, The KeyPoint, Singapore 199597.
Tel: (65) 6220 2216 Fax: (65) 6220 2116 E-mail: publication@strategicom.com Website: www.strategicom.com
09