Organisation: The Case of Targa Tasmania.

Transcription

1 Exploring Reputation Management in an Episodic Event Organisation: The Case of Targa Tasmania. Linda French, B. Com (Hons) (Tas) Submitted in fulfilment of the requirements for the degree of Doctor of Philosophy University of Tasmania (February, 2014)

2 Declaration of Originality This thesis contains no material which has been accepted for a degree or diploma by the University or any other institution, except by way of background information and duly acknowledged in the thesis, and to the best of my knowledge and belief no material previously published or written by another person except where due acknowledgement is made in the text of the thesis, nor does the thesis contain any material that infringes copyright. Linda French Date Statement of Ethical Conduct The research associated with this thesis abides by the international and Australian codes on human and animal experimentation, the guidelines by the Australian Government s Office of the Gene Technology Regulator and the rulings of the Safety, Ethics and Institutional Biosafety Committees of the University. Linda French Date i

3 Authority of Access This thesis may be made available for loan and limited copying and communication in accordance with the Copyright Act Linda French Date ii

4 Abstract Extant literature on the concept of corporate reputation focuses on traditional organisations within markets for goods and services (Walsh, Mitchell, Jackson & Beatty 2009). However, a favourable reputation also provides competitive advantage to the growing number of episodic event-related organisational forms that operate in the social arena and the marketplace of ideas (Mahon & Wartick 2003). The paucity of research in this arena provides the research opportunity for this thesis. Based on a review of extant literature, a process model of reputation management in traditional organisations is presented as the basis for the specific research question in this thesis: To what extent are the factors present in the process model of organisational reputation management evident in an Episodic Event Organisation (EEO) context? This research was conducted as a quasi-longitudinal embedded single case study, focussing on the start-up stage, emerging growth, and mature stages of the annual Targa Tasmania (TT) rally event held in Tasmania, Australia s island state. The methodological approach commenced with the collection and analysis of secondary data pertaining to the TT event. This was followed by primary data collected via interviews with eighteen key informants. A thematic analysis of secondary and primary data was then conducted using the computer software NVivo 10. Research results indicated that many factors in the process Model derived from extant literature were analogous in their applicability to the EEO context, however there was some divergence. The important exceptions to the extant theory included iii

5 the following: firstly, results indicated that in the context of EEO reputation management, it is a strategic imperative that the event s core mission is grounded in cultural links to its place location. Secondly, results suggest an absence of Human Resource Management policies in an EEO context, meaning an inability to strategically control the behaviour of temporary employees. However, results also indicated that behaviour could be strategically influenced via actions such as, incorporating institutional rules into the event structure, and identifying key positions for volunteer ambassadors who could be delegated the responsibility of recruiting and training volunteers within their locale. Thirdly, results suggest that the media exposure variables of tone and recency were amplified in an EEO context due to the event s ephemeral nature. Based on these results a process model of the factors of reputation management within an EEO context is presented. iv

6 Acknowledgements I take this opportunity to thank all those whose contribution and support facilitated the creation and completion of this thesis. First I would like to thank my doctoral supervisors, Dr Dallas Hanson, for his guidance, encouragement and support of my family commitments throughout my candidature, and Dr Stuart Crispin for his advice, reassurance, and wise words. To my supervisor Dr Mark Wickham, your provision of time, direction and research insight were instrumental to the completion of this thesis, and your trusted level of efficiency was both reassuring and inspiring. Second, I would like to thank the study participants for their generosity and cooperation, without which this research would not have been possible. Third, I would like to acknowledge my friends and colleagues at the TSBE for their continued support, in particular Dr Megan Woods and Dr Tommy Wong. Finally, and most importantly, I would like to thank my husband Craig for giving me the time and space needed to finish this mammoth task, and my two beautiful children Samuel (Sammy) and Ellen (Dotty), for their patience and understanding of why Mummy had to work on weekends to finish her book. I also wish to thank Granny, Grumpy, Nanny, Poppy, Aunt San, and Riley for their continued support and the many babysitting hours they provided so that I could finally fulfil this personal goal. v

7 List of Tables Table 3.1 Stakeholder Group Membership 51 Page Table 3.2 Table 3.3 Interview Detail Processes for Data Interpretation Table 3.4 Processes for Verifying Conclusions 64 vi

8 List of Models Page Model A Process Model of Organisational Reputation Management 35 Model A Process Model of EEO Reputation Management 182 vii

9 Table of Contents Page Declaration of Originality Statement of Ethical Conduct Authority of Access Abstract Acknowledgements List of Tables List of Models i i ii iii v vi vii CHAPTER ONE: RATIONALE AND INTRODUCTION TO THE THESIS Objective of the Chapter Rationale for the Thesis Research Opportunity Structure of the Thesis 4 CHAPTER TWO: LITERATURE REVIEW Objectives of the Chapter Defining Corporate Reputation Critical Factors in the Process of Corporate Reputation 10 Management The Role of the Founder(s) Corporate Personality Environmental Context Stakeholder Relationship Management Corporate Communication Management Communication Primary Communication Secondary Communication Tertiary Communication Time Feedback Research Question 34 viii

10 CHAPTER THREE: RESEARCH DESIGN AND METHOD Objectives of the Chapter Rationale for the Research Design Research Method Case Study as a Research Method The Purposes of Case Study Research Criticisms of the Case Study Method The Suitability of the Case Study Method in this Inquiry The Literature Review The Targa Tasmania Event as a Unique Case Study The Purpose of the Research Conduct of the Research The Selection of the Case A Review of the Literature The Development of the Case Study Protocol Key Informant Interview Preparation The Case Study Research Process Combining the Research Purpose with the Research 54 Question The Unit of Analysis Data Collection Case Analysis Editing the Data Data Categorisation and Coding Data Interpretation Verification of Conclusions Mode of Analysis Developing Research Outcomes The Descriptive Outcome The Exploratory Outcome The Explanatory Outcome Chapter Summary 72 CHAPTER FOUR: CASE HISTORY TARGA TASMANIA Objective of the Chapter The Start-up Stage: Formation of the TT Event TT Critical Incidents The Start-up stage: TT The Start-up Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT The Emerging Growth Stage: TT ix

11 The Mature Stage: TT The Mature Stage: TT The Mature Stage: TT The Mature Stage: TT The Mature Stage: TT The Mature Stage: TT The Mature Stage: TT Chapter Summary 107 CHAPTER FIVE: ANALYSIS OF THE TARGA TASMANIA CASE Objective of the Chapter Factors in the Process of Reputation Management in an EEO Context Proposition 1: The EEO founder(s) own reputation, 108 personality traits, business acumen and organisational knowledge will legitimate the EEO Proposition 2: The founder(s) of the EEO will document a 111 Corporate Personality based on a defined core-mission Proposition 3: EEO management will identify, analyse and 114 strategically account for external environmental issues Proposition 4: EEO management will strategically control or 120 influence their stakeholder relationships Mapping the Relationship Network Evaluative Criteria Stakeholder Group Salience and Needs Proposition 5: EEO management will design and implement a 135 comprehensive corporate communications policy based on stakeholder groups needs Management Communication Permanent Employees Entrants as Temporary Employees Volunteers as Temporary Employees Primary Communication Secondary Communication Tertiary Communication Proposition 6: An EEO s reputation formation is a function of 162 time Proposition 7: EEO management will seek stakeholder group 164 feedback and incorporate this into strategy 5.3 Chapter Summary 166 CHAPTER SIX: DISCUSSION AND CONCLUSION Objectives of Chapter Theoretical Contributions Proposition 1: The EEO founder(s) own reputation, 169 x

12 personality traits, business acumen and organisational knowledge will legitimate the EEO Proposition 2: The founder(s) of the EEO will document a 169 Corporate Personality based on a defined core-mission Proposition 3: EEO management will identify, analyse and 170 strategically account for external environmental issues Proposition 4: EEO management will strategically control or 172 influence their stakeholder relationships Proposition 5: EEO management will design and implement a 173 comprehensive corporate communications policy based on stakeholder groups needs Proposition 6: An EEO s reputation formation is a function of 178 time Proposition 7: EEO management will seek stakeholder group 180 feedback and incorporate this into strategy 6.3 Managerial Implications Pre-development Stage Environmental Context Corporate Communication Tertiary Communication Time Limitations of Case Study Research Conclusion 187 REFERENCE LIST 188 Appendix A: Case Study Protocol 209 Appendix B: Interview Documentation 214 Appendix C: Secondary Data Sources 224 Appendix D: QSR NVivo Node Tree 228 Appendix E: NVivo Memo Examples 231 Appendix F: Stakeholder Relationship Maps 233 Appendix G: Targa News 252 xi

13 CHAPTER ONE RATIONALE AND INTRODUCTION TO THE THESIS 1.1 Objective of the Chapter The objective of this chapter is to introduce this thesis. The chapter commences with a discussion of the rationale for this thesis. Next, the broad research opportunity is noted and briefly discussed. The chapter concludes with a discussion of the structure of the thesis. 1.2 Rationale for the Thesis Non-traditional organisational forms (such as events, cooperatives, boundary-less and fully-online organisations etc.) have become more prevalent in business environments characterised by increasing uncertainty, dynamic changes, and an expectation that a firm will contribute to both economic and social aspects of their host location (Gatti, Caruana & Snehota 2012; Lindner & Wald 2011; Lundin & Soderholm 1995; Wright & Fill 2001). Episodic events in particular (such as trade fairs, festivals, sporting competitions, conferences etc.) represent some of the highest-growth non-traditional organisational forms (Arcodia & Whitford 2006; Foreman & Parent 2008; Mair & Whitford 2013; Schubler & Sydow 2013). For example, studies into business events in Australia reveal this is one of the highest yielding segments in tourism, contributing $9.2 billion to the economy in 2012, and recording a 16.8 per cent increase in volume from the period (Bailey & Jago 2012). Music events injected $1.21 billion into the Australian economy during (Deloitte Access Economics 2011), whilst at a regional level the Gross 1

14 Regional Product impact of sport, music and theatre events in the Snowy Region of New South Wales, revealed an economic contribution of 39.8 per cent of visitor expenditure (Janeczko, Mules & Ritchie 2002). Also increasing is the number of entrants to community based sporting events. To illustrate, in 1971 the inaugural Sydney city to surf fun race attracted 2,000 entrants, whilst in 2011 the number of entrants in this event exceeded 85,000 (City 2 Surf, cited in Hajkowicz et al. 2013). The proliferation of episodic events during the latter part of the twentieth century has been attributed to numerous factors, including an increase in consumer discretionary income and leisure time, and recognition of their capability to revitalise regional economies (Janeczko, Mules & Ritchie 2002). This prevalence and recognised importance has resulted in events becoming an increasing focus of research in the social sciences (Schubler & Sydow 2013). Harris et al. (2001) suggest that the evolution of episodic events since the mid-1980s has prompted many governments to actively nurture their events industry, and reached a point where the resultant number, scale, and variety, demand attention from researchers. Whilst initial academic inquiry has focussed on evaluating episodic event organisations economic impact, there has been a call to expand this to include a broad range of issues pertaining to the social, cultural, environmental and political dimensions of such events (Arcodia & Whitford 2002; Davies, Coleman & Ramchandani 2013; Mair & Whitford 2013). This call is partly attributed to recognition that the effectiveness and sustainability of an event organisation is dependent on management s ability to develop a supportive network of stakeholder group relationships (Reid 2011), and over time, a favourable reputation amongst them (Fillis 2002; Getz & Andersson 2008; McDonald & Harrison 2002; Rentschler et al. 2002). The processes pertaining 2

15 to reputation management in episodic event organisations, therefore, is of significant importance given the increasing competition for the discerning event consumers time and disposable income, and sponsorship dollars (Fillis 2002; Harris et al. 2001; McDonald & Harrison 2002; Reid 2011; Rentschler et al. 2002; Sargeant 1999). Whilst elements of extant corporate reputation management processes are no doubt relevant to episodic event organisations (e.g. the ways in which event managers employ strategies to engage stakeholder groups and communicate in a transparent and collaborative manner) (Reid 2011), they do possess unique characteristics that distinguish them from traditional organisational forms (see Foreman & Parent 2008). Lundin and Soderholm (1995) highlight four characteristics common to a number of episodic events: time (referring to the time boundaries of an events existence) team (denoting the organic nature of the event organisations internal structure) transition (meaning the process of moving from non-existence to existence, and back to non-existence), and task (the reason for which the event organisation was originally created). In addition, episodic event organisations also face the difficulty of dealing with a lack of ongoing routines, an absence of organisational memory, highly transient human resources, and a structure characterised by low bureaucracy and a limited hierarchy (Lindner & Wald 2011; Lundin & Soderholm 1995). Episodic event organisations are also likely to be more highly dependent (and therefore vulnerable towards) one major source of sponsorship, one market segment, and a large contingent of volunteer labour (Getz & Andersson 2008; Reid 2011). Such dependencies can create tensions between event management s desire for autonomy, 3

16 and the need to accommodate what are likely to be stakeholder groups with greater discretionary power (Fillis 2003; Getz & Andersson 2008). 1.3 Research Opportunity The broad research opportunity for this thesis emerges from the identified deficit in corporate reputation literature, and the calls to consider the corporate reputation management processes as they apply in non-traditional organisational forms (see Bromley 2002; Fillis 2003; Petkova, Rindova & Gupta 2008; Rode & Vallaster 2005). Specifically, this research seeks to investigate corporate reputation theory within the non-traditional episodic event organisation context, given that episodic events are in fact more prevalent in their occurrence and more significant in their impact than what their treatment in the literature would suggest (Foreman & Parent 2008, p. 223). 1.4 Structure of the Thesis This thesis contains six chapters. Following this introductory chapter, Chapter Two provides an overview of extant literature pertaining to the corporate reputation concept. This overview has a specific focus on those factors involved in the strategic management of corporate reputation within traditional organisational forms. The literature review will culminate in the presentation of a proposed Process Model of Organisational Reputation Management, and generation of the specific research question to be analysed in this thesis. Chapter Three outlines the case method used to gather the requisite data needed to answer the specific research question presented in Chapter Two. The Targa Tasmania (TT) event and its corporate reputation provide the focus of this study. The research was informed via analysis of semi-structured 4

17 interviews undertaken with eighteen key members of the Episodic Event Organisation s (EEO) senior management and salient stakeholder groups. These key individuals were closely associated with critical incidents in the management of TT event reputation over its pre-development (1991), start-up, emerging growth and mature stages of development. Chapter Four presents an historical account of critical incidents occurring in the TT event, which influenced responses of the EEO s management and shaped stakeholder groups perceptions underpinning TT s reputation; the historical account is based on both primary and secondary data sources. It provides the foundation from which interview questions for key informants were designed, and the basis upon which the research question was analysed. Chapter Five presents an analysis of the case data in terms of the Process Model of Organisational Reputation Management presented in Chapter Two. Drawing on the case data, and using the computer software package QSR NVivo (version 10), the common themes emerging from the interviews are identified and triangulated between respondents. Chapter Six provides a discussion of the key findings of the thesis and theoretical implications for corporate reputation literature. Based on analysis of the case data, an adapted Process Model of EEO Reputation Management is proposed. Chapter Six concludes with consideration of the practical implications of the proposed model for EEO management, followed by acknowledgement of the limitations of this study and a brief discussion of future research opportunities in this area. 5

18 CHAPTER TWO LITERATURE REVIEW 2.1 Objectives of the Chapter The objectives of this chapter are four-fold. Firstly, it presents a definition of the corporate reputation concept upon which the remainder of this thesis will focus its attention. Following this, the chapter will present a review of the extant literature focusing on the critical factors and processes inherent to the effective management of a traditional organisation s reputation. Next, and to serve as a summary of the literature review, the chapter will present a process model of organisational reputation management. Lastly, this chapter will present the specific research question to be addressed in this thesis. 2.2 Defining Corporate Reputation The concept of corporate reputation has been investigated through multiple disciplines, most notably organisational theory, strategic management theory, accounting, economics, and marketing (see Barnett, Jermier & Lafferty 2006; Black, Carnes & Richardson 2000; Chun 2005; Fombrun & van Riel 1997; Gotsi & Wilson 2001). Whilst this multi-disciplinary approach has resulted in a rich body of work that demonstrates consensus regarding the strategic role and benefit of a positive corporate reputation, it has also presented challenges in establishment of an agreed definition (Bromley 2002; Carmeli & Freund 2002; Clardy 2012; Devine & Halpern 2001; Fombrun & van Riel 1997; Mahon 2002; Walker 2010). For example, there is a tendency in some disciplines to use the terms identity, image and reputation 6

19 interchangeably (see Barnett, Jermier & Lafferty 2006; Bromley 2002; Clardy 2012; Fombrun & van Riel 1997; Gotsi & Wilson 2001; Walker 2010). The scope of definitional boundaries adopted by each discipline is guided by whether the concept is viewed from an internal or external organisational perspective (see Chun 2005; Deephouse 2000; Gotsi & Wilson 2001). To illustrate, in organisational studies reputation is viewed from an internal perspective (Fillis 2003; Schultz & de Chernatony 2002). Literature suggests that an organisation s internal culture and values represent its identity. This identity drives strategy from which reputation is an output (Fombrun, Gardberg & Sever 2000). The greater the shared internal perceptions of the organisation, the easier it is for management to communicate consistent messages to stakeholder groups and crystallise a coherent reputation (Fombrun & Van Riel 1997). Similarly strategists view reputation as an internal asset derived from an organisation s unique internal processes which are difficult to imitate (Devine & Halpern 2001; Fombrun, Gardberg & Sever 2000; Fombrun & Van Riel 1997). Those in the field of accounting also view reputation from an internal perspective (Fombrun & Van Riel 1997). It is seen as an intangible asset akin to goodwill that is qualitative in nature, thus making valuation of its potential future benefits to the organisation difficult to quantify (Alvarez, Gonzalez & Daguerre 2012; Black, Carnes & Richardson 2000; Devine & Halpern 2001; Dowling 2006; Fombrun & Van Riel 1997). Despite this difficulty there is evidence that a positive reputation has value to investors, and continued research efforts are being made to determine a cross cultural quantifiable measure of the value of an organisation s reputation 7

20 building activities (Alvarez, Gonzalez & Daguerre 2012; Clardy 2012; Dowling 2006; Fombrun & Van Riel 1997). In the discipline of economics reputation is viewed from an external perspective (Fombrun & Van Riel 1997). Reputation is likened to character traits which competitors use to predict likely strategic actions, and stakeholder groups use to understand an organisation s actions and behaviours (Barnett & Hoffman 2008; Fombrun, Gardberg & Sever 2000; Fombrun & Van Riel 1997; Middleton 2009). Reputation is also viewed from an external perspective in the marketing discipline, yet there is discrepancy as to whether reputation is a construct in its own right, or is synonymous with image (Bromley 2001; Clardy 2012; Dolphin 2004; Gotsi & Wilson 2001; Whetten & Mackey 2002). Several researchers have attempted to remedy this. For example, Gotsi and Wilson (2001) undertook a review of marketing literature and identified that there are two dominant schools of thought regarding what constitutes corporate reputation. The first being the analogous school of thought, which suggests that corporate reputation is synonymous with corporate image, and is taken to mean the store of favourable perceptions stakeholders have toward the organisation (Fombrun, Gardberg & Sever 2000; Gotsi & Wilson 2001; Kennedy 1977). The second being the differentiated school of thought, which views corporate reputation and corporate image as two separate, yet intrinsically related concepts to the point where you cannot consider one without the other (Gotsi & Wilson 2001). This school of thought can be further divided into three perspectives. The first 8

21 regards image as an inside-out perspective whereby the organisation engages in superficial actions designed to manipulate stakeholder group perceptions to achieve their desired image (Caudron 1997). Reputation however, is viewed from an outsidein perspective whereby it is an output of an organisation s substantive actions to gain favourable stakeholder perceptions. Thus represents a perceptual asset owned and held within the mind of stakeholder groups (Caudron 1997; Clardy 2012; Fombrun, Gardberg & Sever 2000). The second perspective suggests that reputation is an element of image. For example, Mason (1993, cited in Gotsi & Wilson, 2001) suggests that reputation should be considered within the context of how it affects corporate image. Whilst Barich and Kotler (1991, cited in Gotsi & Wilson, 2001) suggest that corporate reputation is a variable that, when combined with level of awareness, determines image. These two perspectives, like those of aforementioned disciplines, focus primarily on a single stakeholder group such as customers or employees (Chun 2005). The third view of the differentiated school of thought however, introduces the notion of multiple stakeholder groups and is a relational approach to the reputation concept (Chun 2005). This perspective suggests that image is the way external stakeholder groups perceive the organisation, whereas reputation is the amalgam of both external stakeholders organisational images, coupled with those of internal stakeholders (Bromley 2000; Caudron 1997; Whetten & Mackey 2002). Thus reputation reconciles the various images of an organisation that may exist simultaneously amongst different internal and external stakeholder groups (Fombrun 1996; Walker 2010). 9

22 Whilst each separate discipline views the concept through a unique lens, common to all is the assertion that corporate reputation emerges from an evaluative process undertaken by one or more of an organisation s internal and/or external stakeholder groups (see Black, Carnes & Richardson 2000; Caudron 1997; Dowling 2004; Fombrun, Gardberg & Sever 2000; Gotsi & Wilson 2001; Kennedy 1977). Considering this commonality, the following integrative definition is adopted for this thesis: A corporate reputation is a collective representation of a firm s past actions and results that describes the firm s ability to deliver valued outcomes to multiple stakeholders. It gauges a firm s relative standing both internally with employees and externally with its stakeholders, in both its competitive and institutional environments (Fombrun & Rindova, cited in Fombrun & van Riel 1997, p. 10). Given that any entity can have a reputation bestowed upon it by a collective group of relevant stakeholders (see Bromley 1993; Davies et al. 2004; Dowling 2004; Gotsi & Wilson 2001; Mahon 2002), and that not all organisations are corporations (see Abratt & Kleyn 2012; Fillis 2003; Wood & Rentschler 2003; Wootliff & Deri 2001), the terms organisational reputation or reputation (as will be used throughout this thesis) are also taken to meet and represent the corporate reputation definition presented above. 2.3 Critical Factors in the Process of Corporate Reputation Management Similar to those factors stimulating the growth in non-traditional organisational forms, emergent trends in the business environment have focused the attention of management academics and practitioners on the concept of corporate reputation (Abratt & Kleyn 2012; eds Balmer & Greyser 2003; Berens & van Riel 2004; Gotsi & Wilson 2001; Shamma 2012; Walsh & Wiedmann 2004). Trends such as the fusion of global markets, industry deregulation, increasingly vocal consumers, and 10

23 growing transparency in organisational boundaries, have all increased pressure on organisations to identify a distinct point of differentiation which can be communicated to stakeholder groups (Gardberg & Fombrun 2002; Gatti, Caruana & Snehota 2012; Gotsi & Wilson 2001; Gray & Balmer 1998; Hatch & Schultz 1997). The use of intangible organisational specific assets, such as a positive reputation, can provide this point of differentiation and if strategically managed, can constitute a valuable commercial and operational resource (see Abratt & Kleyn 2012; eds Balmer & Greyser 2003; Clardy 2012; Flatt & Kowalczyk 2000; Gotsi & Wilson 2001; Ponzi, Fombrun & Gardberg 2011; Wright & Fill 2001). An organisation s reputation can be regarded as a form of capital which emerges from the strength of organisational relations with its various stakeholder groups (Dolphin 2004; Fombrun 1996; Greyser 1999). Thus, management of corporate reputation requires an organisation to engage in a process of continuing substantive action to earn and retain the esteem of its salient stakeholder groups (Devine & Halpern 2001; Dobson 1989; Dolphin 2004; Dowling 2001; Fombrun 1996; Rindova 1997). An examination of extant literature suggests this process of reputation management within traditional corporate ( organisational ) forms requires the strategic control and/or influence of those factors identified in the sections below The Role of the Founder(s) The first factor identified in the process of corporate reputation management is the role of the founder(s), whose personality, skills and energy imbue their new organisation with a distinctiveness around which its identity (or being ) is developed, and reputation thereafter constructed (Fombrun 1996; Rode & Vallaster 11

24 2005). The more charismatic the founder(s), the more readily salient stakeholder groups will transfer the positive elements of their personality and their reputation to that of the nascent organisation (Bromley 2000; Rode & Vallaster 2005; Williams, Buttle & Biggemann 2012). It is the role of the founder(s) to document the organisation s concept, and define its philosophy, mission and values in order to lay the foundation upon which reputation can be built and managed (Abratt 1989; Aldrich & Fiol 1994; Rode & Vallaster 2005). The founder(s) must also possess the relevant business acumen and skill to effectively communicate their business concept, resources and capabilities to salient stakeholder groups in a transparent and effective manner (Cornelissen, Haslam & Balmer 2007; Stuart 1999; van Riel 1995). It is also the role of the founder(s) to engage in symbolic activities during their organisation s nascent stage to support initial stakeholder group interactions (Petkova, Rindova & Gupta 2008). For example, engaging in personal communication with potential stakeholder groups to establish relationships, prompt awareness of the new organisation, and stimulate positive initial perceptions (Fombrun 1996; Petkova, Rindova & Gupta 2008; Rode & Vallaster 2005). Further symbolic activities may include attending trade shows, recruiting an authoritative figure to provide legitimacy, or affiliating the new organisation with key industry bodies (Petkova, Rindova & Gupta 2008). It is also the responsibility of the founder(s) to allow for flexibility in the nascent organisational structure so that changes, whether they are due to environmental influences or stakeholder group feedback, can be accommodated (Rode & Vallaster 2005). In the absence of an organisation s founder(s), the abovementioned issues and roles must be fulfilled by the appointed top management team, whether this be a Board of Directors and/or 12

25 Chief Executives (eds Balmer & Greyser 2003). Top management must, therefore, be carefully selected to ensure that they possess a reputation, and/or the expertise necessary to fit the organisation s intended mission and values, and support the identity underpinning the reputation management process (Dhalla 2007; Petkova, Rindova & Gupta 2008). According to extant literature therefore, the founder(s) of a new organisation represent the initial factor in the process of organisational reputation management. It is their role to articulate the organisation s philosophy, its mission and values, engage in symbolic activities to establish stakeholder group relationships, and provide flexibility in the nascent organisational structure to respond/pre-empt environmental issues and stakeholder group needs Corporate Personality Corporate personality represents the next factor in the process of organisational reputation management. This personality type comprises several elements: the organisation s philosophy and succinct core mission, the organisation s values, and its strategic management style (Abratt 1989; Caruana & Chircop 2000). Control of this factor of organisational reputation management requires the corporate personality to be accurately documented in written form, most popularly manifesting as a narrative (Rode & Vallaster 2005; Spear & Roper 2013). For example, van Riel s (1995) sustainable corporate story is a narrative form containing these documented elements, which become common starting points for the organisation s reputation. It is the role of the founder(s), or top management, to revisit the corporate story and ensure that new content derived from strategic action is linked to these 13

26 common starting points (eds Balmer & Greyser 2003; van Riel 1995). Such links provide a consistent core theme throughout all of the organisation s signals, and the constant fulfilment of these signals perpetuates a sustainable corporate personality over time (Dhalla 2007; Rode & Vallaster 2005; Stuart 1998; van Riel 1995). The corporate story continually evolves as an organisation implements strategic actions to deal with changes in its dynamic environmental context (Spear & Roper 2013; van Riel 1995). Given its dynamism, the corporate story provides a useful reference tool for its top management team to speed up its decision making processes (van Riel 1995). For example, documented strategic action resulting in organisational accomplishments or stakeholder group benefit can be quickly referred to by top management when interacting with stakeholder groups (Spear & Roper 2013). The corporate story also provides a useful reference point that can be used to strategically deflect, or direct, particular stakeholder groups gaze away from, or toward particular incidents or actions (Middleton 2009). According to extant literature, therefore, corporate personality represents the second factor in the process of organisational reputation management. It is the role of an organisation s founder(s), or top management, to control this factor through documenting the elements of corporate personality in a sustainable corporate story, and to use the common starting points to guide strategic decision making and shape the organisation s reputation Environmental Context The external environmental context represents the third process factor in the management of an organisation s reputation. All internal and external stakeholder 14

27 groups possess a variety of environmental filters through which organisational signals are evaluated and perceptions mediated (Balmer & Greyser 2002; Bromley 2001; Devine & Halpern 2001; van Riel & Balmer 1997). Although many elements and trends in the external environment cannot be controlled (or even influenced in cases) by an organisation, their continued monitoring enables top management to implement strategic decisions which protect the corporate story and, subsequently, an organisation s reputation (Balmer & Greyser 2002; Markwick & Fill 1997). Macro-level issues (such as a country s history, government, politics, economy and culture) all represent filters through which stakeholder group perceptions are influenced (Balmer & Greyser 2002; Maheswaran, Yi Chen & He 2013; Piechocki 2004). To illustrate, favourable country of origin (or operation) attributes act as a powerful filter and heuristic cue that many consumer groups use to extend stereotypical country attributes to organisational operations, products and services (Balabanis & Diamantopolous 2011; Godey et al. 2012; Maheswaran, Yi Chen & He 2013). For example, Germany s stereotyped skill for precision automotive engineering, France s association with producing luxury goods, and Japan s skill in advanced electronics influence perceptions of organisations based in those countries especially in the absence of any evidence to the contrary (Balabanis & Diamantopolous 2011). If an organisation can evoke a positive perceptual association by communicating their country of operation to their stakeholder groups, then they are in a strong position to leverage that reputation to the benefit of their own (Balabanis & Diamantopolous 2011). Further to this point, the manner in which stakeholder groups beliefs and values are formed is also culture- and timedependent, meaning cultural antecedents may influence the necessary duration that a 15

28 relationship between organisation and stakeholder group is active, before reputation can emerge (Bartikowski, Walsh & Beatty 2011; Dowling 2001; Greyser 1999; van Riel 1995). Extant literature also suggests that the industry in which an organisation operates is an issue in the external environment influencing decision making and the process of reputation management (Barnett 2007; Davidson 1990; Fombrun 1996). For example, all organisational members of an industry share reputation commons, whereby the actions of one member in an industry, by association can affect the reputation of other members, as well as the industry as a whole (Barnett & Hoffman 2008; Middleton 2009; Shamma 2012; Winn, MacDonald & Zietsma 2008). To illustrate, a study by Williams, Buttle and Biggemann (2012), determined that media exposure of abuse within boys homes stimulated negative word of mouth which unfavourably impacted upon the non-profit s reputation. This negative word of mouth also generated increased scrutiny of associated non-profits, which damaged the reputation of the charity sector as a whole, and adversely impacted donations received by other aid organisations (Williams, Buttle & Biggemann 2012). Understanding these potential impacts can guide the strategic decision making processes of top level management, and have a major influence on the sustainability of an organisation s reputation (Barnett 2007; Williams, Buttle & Biggemann 2012; Zyglidopoulos 2001). Similarly, top management can leverage their industry s reputation and stakeholder group knowledge of institutional rules and regulations to provide a reputational buffer, especially in times of organisational crisis (Barnett & Hoffman 2008; 16

29 Shamma 2012; Winn, MacDonald & Zietsma 2008). A reputational crisis occurs when relatively negative incidents are extensively publicised and prompt stakeholder groups to negatively re-evaluate their perceptions of the organisation and its activities (Zyglidopoulos & Phillips 1999). For example, the effects of a plane crash on an airline s reputation can be diffused if it can be demonstrated that the organisation s practices had a strong and consistent emphasis on safety (Zyglidopoulos 2001). Such benefit is restricted to isolated incidents, and the corporate reputation literature suggests that recurrent and persistent crises would ultimately signal organisational negligence and hypocrisy (Coombs 2007; Zyglidopoulos 2001). According to extant literature therefore, an organisation s external environmental context represents the third factor in the process of reputation management. Identified country of operation macro level issues, such as the institutional environment, must be incorporated into strategic decision making if they are identified as filters through which stakeholder groups perceive organisational information Stakeholder Relationship Management Corporate reputation ultimately represents the collective sets of images held by salient stakeholder groups which have solidified over time into a point of reference (Abratt & Kleyn 2012; Alvarez, Gonzalez & Daguerre 2012; Caudron 1997; Clardy 2012; Dolphin 2004; Fombrun 1996). Organisational reputation is, therefore, a stakeholder-based concept (Sarikaya, Yilmaz & Temizel 2012; Zyglidopoulos & Phillips 1999), and controlling or influencing these relationships is the fourth critical factor in the process of organisational reputation management. An organisation must continually interact with its salient stakeholder groups so that trusting relationships 17

30 can be established, and the varying needs of salient groups identified and balanced (Aldrich & Fiol 1994; Fombrun 1996). To facilitate this role, the network of stakeholder group relationships and all points of interaction must first be mapped and understood (Middleton & Hanson 2003; Sarikaya, Yilmaz & Temizel 2012). This mapping must be constantly monitored to ensure it remains accurate and relevant within an organisation s fluid environmental context (Abratt & Kleyn 2012; Getz & Andersson 2008; Sarikaya, Yilmaz & Temizel 2012; Shamma 2012). This becomes an increasingly difficult task where stakeholders have membership of multiple groups, and the boundaries separating internal and external stakeholders continue to dissolve (Abratt & Kleyn 2012; eds Balmer & Greyser 2003; Dowling 2001; Hatch & Schultz 1997). Nurturing trusting relationships and influencing perceptions also requires an organisation to identify all functional, psychological, and economic criteria that stakeholder groups use to evaluate organisational interactions (Abratt & Kleyn 2012; Clardy 2012; Dowling 2001; Lewis 2001; Mahon & Wartick 2003; Zyglidopoulos 2001). Each group will have its own unique mix of criteria and the importance attached to individual dimensions may differ (Clardy 2012; Mahon 2002). Given this, it is possible for an organisation to have both favourable and unfavourable evaluations on the same criterion at any one point in time (Abratt & Kleyn 2012; Alniacik, Alniacik & Erdogmus 2012; Caruana & Chircop 2000; Dowling 2001; Olins 2000; Walker 2010; Zygidopoulos 2001). This may be a concern if open communication channels exist, and interactions between members of the stakeholder relationship network arise independent of the organisation (Bromley 1993; Fombrun & Rindova 1998; Mahon 2002). Such activities may stimulate stakeholder group 18

31 interest in not only how organisational activities meet their own expectations, but also those of alternate groups, which could lead to the positive evaluation of one stakeholder group being tainted by the poor evaluation of another (Carter & Deephouse 1999; Mahon & Wartick 2003). To reconcile such conflicting stakeholder group evaluations, the balance of power at each relationship nexus and the salience of each stakeholder group to organisational operations must be understood (Carter & Deephouse 1999; Fearnley 1993; Hammond & Slocum 1996; Olins 2000; Sarikaya, Yilmaz & Temizel 2012). This is of particular importance if the balance of power lies with a salient stakeholder group, as they may be able to wield influence and force a change in an organisation s strategy to meet their own needs more easily (Fearnley 1993). A mechanism to reconcile conflicting stakeholder group evaluations (and ensure responsiveness to their changing needs) is an emphasis on common starting points in the strategic signals transmitted to stakeholder groups (Bromley 2001; Gray & Balmer 1998; Margulies 1977; Rode & Vallaster 2005; Smythe, Dorward & Reback 1992; van Riel 1995). As noted earlier, the presence of common starting points within all organisational signals ensures a consistent thematic link to the corporate personality is retained (van Riel 1995). This, combined with constant fulfilment of strategic signals allows the corporate story to be sustainable, and generates a history of consistent organisational behaviour (Carmeli & Freund 2002; Dobson 1989; Elsbach & Glynn 1996; Fombrun & Rindova 1998; Ponzi, Fombrun & Gardberg 2011; Walker 2010). Consistent behaviours are the bases for generating an organisation s credibility, and provide a store of reputational goodwill which can favourably bias stakeholders future (re)evaluations of organisational actions 19

32 (Bennett & Gabriel 2001; Fombrun 2000; Jones, Jones & Little 2000; Piechocki 2004; Zyglidopoulos & Phillips 1999). In addition to this, constant fulfilment of signals increases reputational resilience, whereby stakeholder groups may reject or distort any signals which do not fit with their existing reputational perceptions (Dobson 1989; Caruana 1997; Grunig 1993; Herbig & Milewicz 1995; Rindova 1997; Wartick 1992). To manage stakeholder relationships, therefore, all sources from which organisational signals are received must be identified (Clardy 2012; Rindova 1997). This is vital given the emergence of new media and increasingly educated consumers that continually discover new methods of sourcing information on organisations of interest to them (Fearnley 1993; Schultz & de Chernatony 2002). Such understanding would enable an organisation to strategically control (or at the very least influence) the sources of corporate communication and the signals they convey (Balmer & Gray 2000; Bernstein 1984; Dowling 2001; van Riel 1995). According to extant literature therefore, managing stakeholder relationships is the fourth critical process factor in organisational reputation management. It requires an organisation to map its network of stakeholder relationships; have knowledge of the criteria each group uses to evaluate organisational actions; use mechanisms to balance the salience and disparate needs of stakeholder groups; and understand each stakeholder groups preferred sources of corporate communication Corporate Communication Extant literature suggests that the fifth critical factor in the process of organisational reputation management is the strategic control, or influence over, corporate 20

33 communications (Herbig & Milewicz 1995; Logsdon & Yuthas 1997; Markwick & Fill 1997; Ponzi, Fombrun & Gardberg 2011; Walker 2010). Strategic signals are transmitted via an array of channels which combine to constitute the corporate communications mix (Abratt 1989; Gray & Balmer 1998; Markwick & Fill 1997; Shamma 2012). To influence perceptions held by stakeholder groups about an organisation (and to strategically shape reputation over time), an organisation must identify the communication methods most effective at reaching salient stakeholder groups, and construct a coherent corporate communication policy to drive them (Balmer & Gray 2000; Bernstein 1984; van Riel 1995). The following section discusses the critical elements of a corporate communication mix as espoused by Balmer and Gray (2000), Bernstein (1984) and van Riel (1995) Management Communication As discussed in section all organisational signals must reflect the corporate personality, adhere to the sustainable corporate story, and connect to the common starting points (Babic-Hodovic, Arslanagic & Mehic 2013; Dhalla 2007; Ettore 1996; Rode & Vallaster 2005; Stuart 1999; van Riel 1995). Targeting internal stakeholders with this in mind (and typically focused on employees), van Riel (1995) proposes the use of management communication to strategically control employee behaviour. Constant reinforcement of central and distinct attributes in management communication can stimulate convergence between employees own values and beliefs and those of the organisation, thus strengthening the organisational identity (Albert & Whetten 1985). 21

34 Organisational identity can also be used as a strategic tool in the process of reputation management (see Albert & Whetten 1985; Brown et al. 2006; de Chernatony 1999; Friedman 2009; Helm 2011; Otubanjo, Amujo & Cornelius 2010). To illustrate, Chong s (2007, p. 201) study of internal training and communication at Singapore Airlines determined that cementing these actions in the organisational identity, served to transform employees into walking embodiments of the core values, and assisted Singapore Airlines become one of the world s best international carriers. Thus, a cohesive organisational identity generates employee pride, enhances employee appreciation of their roles and responsibilities, and prompts them to spread positive word of mouth (WOM) regarding organisational operations (Brown et al. 2006; Helm 2011; Stuart 2012). Using management communication to continually nurture organisational identity in a fluid environmental context ensures interactions between employees and external stakeholder groups continue to reflect an organisation s core mission and values, and the corporate personality (Dhalla 2007; Gioia, Schultz & Corley 2000). Specific management communication mechanisms include all informal and formal tools adopted by the founder(s), or top management to inform, control and motivate employees to accept and adhere to the organisation s identity (Rode & Vallaster 2005; van Riel 1995). Whilst formal tools (such as , intranet, newsletters and scheduled meetings) often prove useful, informal personal communications (particularly if from the founder(s)) is identified as one of the most effective management communications tools for generating employee commitment and support (Balmer & Gray 2000; Fombrun 1996; Hatch & Schultz 1997; Olmedo- Cifuentes, Martinez-Leon & Davies 2013; Rode & Vallaster 2005; Stuart 1999). In 22