Why corporate identity is more than just a logo

Date: 04/01/1996

CHANGES and complexity in companies and markets challenge traditional ways of achieving differentiation and profile, or of influencing corporate culture.

A new approach to corporate identity faces the issue head on, giving an integrated perspective to achieving success in a multicultural market-place.

It would be difficult to claim that the old concept of corporate identity had won the hearts and minds of senior businessmen across Europe, but there is plenty of evidence to suggest that, in its second incarnation, corporate identity is of vastly-increased relevance for EU companies, and is recognised as being so.

If we limit our view of the discipline to logotypes, symbols and corporate colours, as many companies tend to in Britain, we shall miss its potential value.

If, however, we enlarge our view to a definition which encompasses an organisation's own cultural self-awareness and how this finds expression both internally and externally, then we are on the brink of understanding the potential of corporate identity, particularly in complex, multi-cultural market conditions.

Perhaps the best way of illustrating this 'holistic' view is with some examples of corporate situations where identity is the fulcrum, and where - in the broad sense - it has either been the key to success, or has caused problems.

These examples hold some major lessons for European companies, particularly in the way that the implications so easily cross borders.

An obvious cross-border example first: Eurostar, which is the direct passenger link from London Waterloo to Paris and Brussels. Conceived as a three-cornered project from the start, the question of identity was always going to be a central issue. In the event, the identity of Eurostar is just beginning to gel, to separate itself from other aspects of the Channel Tunnel operation, such as Le Shuttle.

Eurostar is a success. The trains are distinctive, the service is attractive and the behaviour is, well, multi-cultural.

On no airline is the sense of cultural partnership so completely conveyed, from the joint nature of the undertaking, the national inputs to design and the working in harmony of the bilingual crews.

All of these things beautifully express what's special about the service, and represent its identity, giving it in-depth differentiation. Yes, the appearance - the design - is important, but it's the sum total of all the identity dimensions which ensures success.

Such a seamless result was not easily achieved, however, and there were many battles on the way, some resulting from cultural mismatches.

In many companies, these are endemic - comical sometimes in the short term, but disastrous in effect. Personally witnessed was the regular meeting between European communication directors of a Francophone multinational.

The Italian representative's French was virtually incomprehensible (especially to the French), the Spaniards spoke French words with Spanish grammar and the two Germans went to sleep. Needless to say, the company had communication problems with the outside world as well.

This cause-and-effect between internal culture and external image is one of the main indications of the holistic nature of identity. No other discipline takes such a broad, strategic view of the factors which affect a company's image. The relevance of this view is well demonstrated by taking a different angle on an over-quoted example: Brent Spar.

Shell's PR and corporate communication functions took quite a battering, but we can look deeper for the real causes.

Identity divisions between 'upstream' techno-cultures and 'downstream' marketing cultures are common in the oil industry, and Shell is no exception. The world of promotions in bright suburban petrol stations is seemingly far removed from the chancy, raunchy but high-tech world of North Sea exploration.

Corporate behaviour (one of the 'dimensions' of holistic corporate identity) is, however, no respecter of boundaries between target audiences and, despite millions spent downstream in trying to convince the public that there really is a difference between Shell and other petrols, and on schemes which seek to secure customer loyalty, actions upstream were guided by a different mindset, that of the technocrat who knows best.

The upstream drama proved to be a very effective way of reaching target audiences across all European boundaries - but with the wrong kind of message.

The episode also showed up cultural discrepancies between Shell in the UK and Shell in Germany, which should have been expected beforehand, given the differences in environmental attitudes between the two countries.

The rest, as they say, is history, and supports the contention that culture is a dimension of corporate identity, with a tangible communications effect.

Oil companies have another identity problem, apart from the one they share with banks, which is that nobody really likes any of them.

The problem I refer to is illustrated by the battle with supermarkets, whose ability to sell petrol is intimately related to their identities as providers of competitively-priced goods from batteries to baked beans, from magazines to meat. As they are known and trusted in their roles of purveyors of quality and value, it is but a short hop to distributing a commodity (petrol) which is widely believed to be from interchangeable sources.

Oil companies' identities are not readily transferable - how would you feel about BP milk? Given their retailing aspirations, this is not helpful. Pile on Brent Spar and you begin to (almost) feel sorry for them.

All of these issues, which are life-and-death for major corporations, are corporate identity issues. They are about how companies understand themselves and about how they promote the desired understanding both internally and externally.

They are concerned with the five essential dimensions of holistic corporate identity - products/services, design/communications, behaviour, culture and the market. These are both omnipresent and interdependent.

Who says so? Well, twice-yearly over the past six years, we have commissioned MORI to carry out a pan-European research study, under the title Corporate Identity in a Multicultural Marketplace.

The sample has been upwards of 200 senior executives from top companies in nine countries.

Their opinions, attitudes and expectations make it clear that corporate identity is understood as vastly more than a logotype, that different countries see it differently but the trend is towards an holistic view, and that the reasons those interviewed give for citing particular examples of successful identities owe everything to such a view, and very little to narrower, exclusive perceptions of, say, design or culture alone.

It is clear from this survey that, as companies move towards the millennium, the only relevant approach is an holistic one.

Complexity and change, the stuff of which our modern days are made, demand new approaches to all kinds of situations. Operations in our home market (Europe) are complex enough in themselves, given our cultural diversity, but are also subject to pressure from outside, for example, from Far Eastern competition.

Corporate identity, practised as an holistic discipline, can make sense out of complexity, allowing us to trace the intricate threads of cause and effect, and to create multi-dimensional differentiation in rapidly-changing, competitive markets.

One-dimensional approaches deny the changes which have occurred and continue to occur in the world - changes which are echoed in individually-held values and which therefore influence all decisions, including the consumer's choice of products or services.

Some European companies are beginning to take an holistic approach to developing their identities. They are reaping the benefits of a better understanding of their own nature, a clearer view of the effect of their culture, a way to a stronger esprit de corps and a more sharply-focused market position.

Other European companies still consider that culture, for instance, is in a different department from marketing. In a time of accelerating change and upheaval, there is no place for traditional dividing walls in communications, and holistic corporate identity is set to demolish them.

Chris Ludlow is a London-based director of Europe's longest-established corporate identity consultancy, Henrion, Ludlow & Schmidt.