The brand and corporate philosophy

I have a slide on the brand’s relationship to corporate philosophy, among my presentation material. It’s the first slide in the set, so it probably isn’t well remembered after all the exciting slides that follow. In essence, what it says is that the brand is a ‘managed translation’ of corporate philosophy into bottom-line outcomes.

For this piece, I will define corporate philosophy as three interlinked components: vision, mission and values.

The vision is easy enough. For my personal taste, I prefer it to be a quantifiable goal with a timeline, for instance ‘lead the segment in terms of sales, five years from now’. Deadlines and measures make life easier and more trackable. Values are the qualities that we need embedded in the organization’s character that will enable us to get there. I will talk about those in a later column.

Mission is a bit more complex. I’m old school and prefer a ‘multiple questions’ analysis. Using these methods, the first question is inevitably ‘Why are we in business?’ The first question about business should ask about measurable gain. In other words, ‘what’s in it for the people operating the business’? If the interests of investors, owners and employees aren’t satisfied, there is hardly any reason to do business which doesn’t bode well for operational sustainability.

Newer methods translate that into ‘What is our purpose?’ That’s the tricky bit. Purpose is more all-encompassing, for instance offering the whole world a cold drink, or alleviating climate change with renewable energy.

If you reread the two paragraphs above, you will understand how easy it is to confuse a vision and purpose.

If it is developed in a sound manner, the purpose acknowledges expectations of the entity on the part of stakeholders and consumers, which is not necessarily a vision. Purpose translates into the positive bottom-line outcomes of stakeholder assent and market sustainability. In fact, so watertight is the need for these outcomes, that the purpose is now being linked directly to the brand, renamed ‘brand purpose’ and upweighted to sit in the same tier as vision, mission and values.

However, for the sake of tradition, let’s put the triumvirate of vision, mission and values into the corporate philosophy box, extend with a fat, red arrow to a clear and succinct purpose in a second column and use that as the guiding principle for satisfying stakeholders and customers in a third column.

The synthesis of vision, mission and values into a purpose may be informed by exco or C-suite, but given the fundamental strategic impact, the accountability for formulation of purpose must be handled at the level of the board or owners. Standing that statement on its head, we arrive at the fact that the board and owners must have necessary and sufficient understanding of what is a brand.

Given that the brand is multi-functional, spanning various departments, the board must also take responsibility for directing the C-suite and exco on departmental aspects.

What is implicit to this is the aspect of differentiation and barriers to substitution in the purpose. There are very few enterprises that will not compete for perceptual resources. Those resources will tend towards the intangible, whether they are the goodwill of consumers, willingness of equity to commit or the attention of stakeholders.

If the purpose is neither clear nor compelling, nor translatable into self-interested consumer and stakeholder outcomes, it will be substitutable (read perceptually disposable). There are times when good enough is good enough, but a strong differential in corporate philosophy will strengthen the bottom-line.

That seems like a decent reason for another round of CPD. I will deal with the differential in the next column. Watch this space.