The financial services brand meltdown and the square root of trust

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The past fortnight has seen Barclays and then HSBC, arguably the two premier UK bank brands (according to the Interbrand annual poll), implode.

Almost two years ago, I wrote this in my CIPD People Management column:

Mervyn King recently became only the second Bank of England governor to address the TUC – and what a time to choose. Interestingly, he highlighted the bonuses still being paid in the financial sector and told union activists they had every right to be angry over the damage that bankers had inflicted on the economy.

He warned that the country would feel the effects of the banking crisis for a generation and argued that there was no alternative to tough action to cut the national deficit. He may well be right; but this was hardly the sort of speech to inspire, induce confidence or spread goodwill.

But King’s comments are backed up by the publication of Interbrand’s Best Global Brands poll for 2010. With just five UK entries in the top 100, the poll reinforces the sense that our national pride, expressed in brand dominance terms, appears to be over-reliant on financial institutions.

Even in these dark days, two banks represent the UK’s highest ranking brands: HSBC at number 32 and Barclays at 74. In fact, the financial services sector as a whole recovered from a 40 per cent drop in the charts in 2009 to a 26 per cent overall improvement in 2010. But at what cost? This recovery hasn’t been matched by other sectors, which are undoubtedly still feeling the effects of supporting their financial service counterparts.

This rise is attributed to aggressive new market entrants and economic recovery. “What recovery?” I hear you cry.

While the apparent recovery of the banks may well be great news for the bankers, it’s arguably good news as well for most other sectors that benefit directly or less directly from fluctuations in the fortunes of the banks. Issues over the distribution of wealth aside, this does beg a number of big questions:

• Have financial services organisations learned the lessons of the recent past, and will they finally start to build sustainable internal cultures based on core values and a return to relationship management?
• Have the worldwide regulatory bodies developed the appetite and aptitude needed to ensure that the global economy isn’t thrown into a spin by questionable practices?
• How patient are non-banking workers?

What the Interbrand league certainly seems to suggest is that the UK economy urgently needs stronger sustainable brands, certainly within financial services but also from a more diversified range of sectors. And leading brands are built and sustained, first and foremost, from the inside out.

The UK has some fantastic brands with stories to be proud of. In brand management terms, however, we unfortunately appear to be a long way behind many of our international competitors. That can be addressed with a large dose of appreciative, joined-up thinking. But what the economy needs right now is inspiration – not the dour doom-mongering from the heads of our national institutions, be they politicians, religious leaders, CEOs or even the head of the Bank of England.

While debating the PR disasters which have inevitably afflicted both HSBC and Barclays (who, lest we forget, were lecturing us all on trust and culture not so long ago), I was reminded of the ancient Chinese proverb concerning two emperors: One was wicked and suppressed his people and the other was benign and giving. When the wicked Emperor softened just a tiny bit, his people loved him. But when the good Emperor had to introduce some unpopular laws… he was assassinated.

After nearly 6 years of financial meltdown and countless brand disasters, we’re still frustratingly far away from witnessing action to address the root cause of the trust-related issues which are poisoning the sector from within. It’s actually questionable whether the leaders who matter really  appreciate the true root cause rather than making excuses for the symptoms. Even the seemingly drastic measures Barclays has reputedly taken, employing a high-powered City lawyer to root out the problems at the core of the culture fails to acknowledge that culture development requires a systemic, appreciative solution facilitated by credible, independent experts rather than a witch hunt by members of the same establishment who are probably part of the problem.

But perhaps we can all draw a tincture of comfort from the Chinese proverb, namely that popularity may well be over-rated and that having reached an all time low in the eyes of multiple stakeholders, the only way, as they say, is up…..

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Welcome acclaim for Brand Champions – a B2B recommended summer read

Brand Champions

Author: Ian P. Buckingham
Published by: Palgrave Macmillan

Gone are the days when ‘colleague engagement’ was tacked onto the end of a brand project. A couple of roadshows and free mousemats do not maketh a business fully aligned with its brand.

Ian P. Buckingham sets out the case for creating greater colleague commitment, treating the workforce as a powerful asset for brand growth. A sequel to Brand Engagement, this book supports integrated brand management within, and across, an organisation from boardroom down (not just passed between marketing, HR and internal communications).

What makes Brand Champions a recommended read is the richness of material on ‘how’ to build brand enthusiasm. Original cases (from Barbour to British Gas) make a refreshing change from the usual ‘cool brand’ suspects. There’s a treasure trove of tools for you to raid – from ‘brand superheroes’ to ‘brand eisteddfods’ – anything that links individual contribution to bigger brand purpose is to be warmly welcomed.

Helpfully, it’s a B2B behemoth that emerges as a world leader in building brand commitment. Cemex, for example, recognises growth through M&A means global brand engagement can’t happen by accident. Brand champions are seconded for months to spread Cemex culture. Line managers are responsible for ensuring employees provide a brand experience in line with brand strategy.

Critically, this book highlights the cost of neglecting brand commitment. Investing in understanding and motivating customers is a false economy unless colleagues are committed to delivering the brand. As Buckingham concludes, “Don’t spend money on advertising unless you can first back up your promises.”

Recommended by: Rosa Wilkinson, corporate brand consultant, Dragon Rouge

To take a look at the rest of the Summer reading shortlist which includes works by Campbell, Godin and Collins, follow this link.

Brand watch: Barbour, a lesson in heritage and values-led innovation

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Worn by royals and pop icons alike, design icon Barbour is one of Britain’s classic brands.

It has been headquartered in the North East for the past 100 years and has a long lineage of family owner-managers, brand custodians one and all including Dame Margaret Barbour who took the reins in the 70s.,

Travelling draper John Barbour opened the first shop in 1894 in South Shields. His sons Jack and Malcolm came on board as partners in 1906. The first Barbour catalogue appeared in 1908, and within ten years the company was selling garments to South America, Hong Kong and South Africa.

In the 1930s Barbour began retailing clothing designed for motorcycling, kitting out British international motorcycling teams for three decades in Barbour International Oiled Cotton suits.

Margaret Barbour was born and brought up in Middlesbrough and trained as a teacher. Following her husband’s untimely death she dedicated herself to driving forward the business. She first became a director, working in every department to understand and appreciate the company root and branch.

In 1972 she took control of its fortunes when she accepted the role of chairman. Dame Margaret immediately began refreshing and diversifying the well-established brand, introducing accessories and new styles to open up the Barbour name to a wider range of age groups and countries.

The iconic designs of Barbour’s classic products, at the core of which are its corduroy-collared waxed jackets, are now evolving to include a large range of contemporary twists on a well-established theme.

Strong design, a deep understanding of retail markets worldwide yet retaining a very clear site of heritage and legacy all underpin Barbour’s perennial appeal. The company believes that design is a priority best carried out by those who know the brand well.

Dame Margaret said: “Design has been and remains at Barbour, a team effort. We have the benefit of being a smaller company that can work in a close team from the original conception of the product through to final production. We do not believe the brand has a need for a named designer like the pure fashion brands. We have always numbered designers from casualwear backgrounds within the team and find it is this mix of skills which makes our products unique and exciting.

It is essential, however, that designers understand the importance of Barbour’s history and heritage as this is at the very heart of the brand. We have our original catalogues from 1908 (when the first one was launched) and they are a constant source of material and inspiration to our design team.”

Barbour has been awarded three Royal Warrants, first from the Duke of Edinburgh, then the Queen, and in 1987, the Prince of Wales.

The royal connection has boosted sales – not only from the Royal Warrants but also from the Oscar-winning film The Queen. Helen Mirren’s depiction of the Queen wearing a Barbour jacket doubled sales in New York.

They may now have offices in Germany, France and America and close working relationships with distributors in all other markets, but Barbour’s brand identity is in safe hands. Dame Margaret comments: “It is important that as we develop and evolve the brand we remain true to our founding principles of quality, fitness for purpose and durability.

“New contemporary styles return you to relevance but only delivering quality and innovation can ensure that you remain there.”

Barbour prides itself on its values and ensures that each and every one of their employees embraces them, stimulated by communication, training and development, leadership and the cultivation of an internal culture that prioritises community, respect, integrity and trust.

As Sue Newton, head of PR states “You should never underestimate how important the trust is between company and consumer, how long it takes to build up and how quickly it can be destroyed.” There are many senior execs who’ve learned this lesson the hard way in recent times.

According to Chris Sanderson, cofounder of international trend consultancy The Future Laboratory, Barbour’s success is built on its values and is fed by a growing need for authenticity. In a Daily Mail article titled Why the Barbour is suddenly so Rock and Roll he writes “for this generation, Barbour is quite a discovery”. You could say the same for several generations who have discovered this grounded but innovative, classic brand.

Any lessons there for other sectors?

To read more about Barbour and the philosophy and the people who sustain and nurture this iconic brand, pick up a copy of Brand Champions which features an in-depth case study of the brand and its key champions in action.

More creative tension on the employee engagement front

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A few weeks ago I featured the Employee engagement taskforce in my regular People Management column.

Why? Well it’s no secret that I am a passionate advocate of employee engagement as one of the core pillars of sustainable brand management. But like many people, I’ve grown increasingly weary of witnessing rank dis/misengagement within organisations; reading about the seemingly countless surveys saying the same and then listening to the government dissemble about the topic yet take very little practical action other than to commission more committees and studies.

Perhaps this initiative will be different? I guess more time will tell.

In the meantime, a little grit in the oyster will hopefully help, especially as it comes from a passionate place.

I was naturally pleased to see the numerous and varied, mostly useful comments that the post attracted, not least this piece from North of the border by leadership specialists Able.

Creative tension on the employee engagement front

Posted on May 9, 2012

Ian Buckingham’s blog has a great new post with an even better title, ”Employee engagement Taskforce: an oxymoron?” Clearly not impressed, he says progress is ”painfully slow” whilst offering some pragmatic reasons why employers are not responding quickly enough to the case for action on the employee engagement front.

The Taskforce’s communications manager Ali Godding has provided a very useful and informative comment on Ian’s blog explaining what has been happening in the past year and what is about to happen now. All good sensible things about spreading awareness, gaining buy-in, employing social media, building momentum, etc, etc. Well worth reading.

The creative tension, however, is clear to see in this crucible. I back Ian and favour the pragmatic approach of getting on with it. I’ve written before about the simplicity and honesty of former Tesco boss Sir Terry Leahy’s approach, which is backed up by The Training Foundations “Rules of Engagement”: it’s all about managers being leaders and creating a positive impact in every conversation, interaction and relationship they have. I say, let this drive the need for more sophistication, rather than spend time now trying to engineer it.

I couldn’t have said it better myself Mac.

Creative tension is healthy.

But perhaps one positive to emerge from the Barclays debacle, the latest brand to implode dramatically on the back of a fundamental misunderstanding between the perspectives of the leaders versus the major stakeholders (starting with the employees), will be that the key decision makers might just start to pay a lot more attention to this business-critical area.

Tipping point?

Cross-cultural communication and the line manager

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We were asked to undertake an extensive comms audit of the global offices of a multi-national brand. Apparently the leaders were concerned at the differences in the way their town hall meetings were being received in different parts of the world and with diversity in mind wanted to ensure that the cascade approach they adopted to internal communication was working.

What we uncovered, as the enlightened internal communicators out there may expect, was a fundamental difference in the way local communities responded to what they perceived as central dictat. Much depended on:

  • the quality of local line management facilitation
  • the degree of flexibility spelled out in the core materials
  • the behaviour of the visiting Vip leader
  • the amount of consultation involved and quality of the feedback process

The improvement process that resulted included the transformation of the standard team briefing process to a team listening approach as well as skills development workshops for first line managers who were identified as the pivotal communicators.

There are many reasons why this group is so important to local engagement. One of the most important is illustrated in this light-hearted table:

Why not create your own version for the country in which you operate?

Here’s a satirical take on the subject as part of London-based designer Yanko Tsvetkov‘s Mapping Stereotypes project.

Be great to build up an international set, don’t you think?