It is strategically logical for businesses to milk the equity of their founders, self or family, to drive consumer equity, especially if there is a strong origin story. In recent years, however, we are noticing many such stalwarts on the wrong side of the law due to financial or ethical misdeeds, usually unconnected to the performance of the brand. The latest challenge for corporations is to thus manage the DNA Dichotomy, taking fair advantage of lineage without suffering any unfair disadvantage.
Two prominent cases represent the two extremes of this situation, namely Samsung and United Breweries. We have all noted how the heir of the Samsung empire was recently jailed for five years in a bribery scandal, an ethical fallacy that certainly deserves suitable censure. Equally importantly, this is totally unconnected to the products and services of the Samsung brand, on a visionary growth path led by a culture of innovation and integrity. Fortunately for the renowned Chaebol, the accused individual does not contribute to consumer equity, unlike say Steve Jobs or even Tim Cook; his largely non-executive stature means that the only question-mark is corporate reputation and stability. Unless the stock markets revolt, the only other casualty may be management attrition, eminently manageable compared to the other dire possibilities.
On Kingfisher beer, however, the situation is fairly different with the Chairman, currently facing litigation, a key architect of brand imagery and associations. His flamboyance is an undeniable asset in an exuberant category, in addition to the impact on organisational integrity, especially in the context of the airlines debacle. The formidable brand management programme of the company, including quality and innovation, has ensured consumers are unaffected by the developments but for how much longer is certainly a debate. It will be undoubtedly difficult to suddenly delink his stated ill-doings while benefitting from his charisma, the latter a key pillar of brand equity.
A sub-set of the DNA Dichotomy is the false moves of senior professional managers, especially at the CXO level, whose influence on the organisation is no lesser than the genetic founder. Recent corporate history is filled with instances where a deplorable fallacy like sexual harassment or corruption brings down not just a career but the perceived worth of the organisation, especially when the leader is associated for many years and is proven to have shaped the companyâ€™s worthiness. Whatever be the scenario, whether the culprit is the original founder or employed supremo, brands must urgently learn to disassociate from the most fundamental association when the necessity emerges.
A part of the solution to this sticky challenge lies in the basics of Brand Equity, especially in the building of brand identity and image. Where the origins of the brand, be it human or contextual, must inspire the identity development quite like a funnel â€“ all elements getting in but only a careful selection being exposed to the customer. And that too in terms of tangible values and principles that define the value proposition and not simply the connectivity with a significant individual. It is well-proven by now that flamboyant or overwhelming founders can offer significant impetus to consumer preference, but that is not a sustainable strategy from the lens of mortality even if all else was well.
The other and equally challenging aspect is to create a brand culture which is individual-proof, drawing from a whole set of definite human traits yet rising above all of them. Fashion organisations do this well by building a continuing legacy that ritualises the intent of a genius, compelling others to derive energy and inspiration. A necessary impact will be felt by the image-building campaigns, where the satrap is never allowed to supersede the credentials of the entity. It may sound restrictive at the outset but in the long run if a reputation crisis does emerge then it can become an insurance policy.
Two organisations that have erred by not building a scalable culture beyond the founderâ€“the first predictably and the second disappointinglyâ€“must certainly be Patanjali and Infosys. The certainly exceptional founder of the Ayurvedic brand has built an empire that is potentially as fragile as the tenure of a yogic posture, its entire reputation depending squarely on his own agility. Unless the brand is allowed to build on its high-potential core, it may easily confront a climax as resounding as Sahara, in spite of commendable intent and output. Infosys, courtesy its recent eccentricities, is behaving like a Mom-and-Pop store with professional successors denied the bandwidth to make the reputation time-proof, as per available evidence at least. At the current time, the original founders are unimpeachable but this is truly yet another dimension of the DNA Dichotomy, where the overbearing possessiveness of the creators work against the offspringâ€™s interests, as damaging as an act of financial or ethical misappropriation.
No comment on this subject will be complete without an opinion on the Tata Sons crisis wherein the DNA Dichotomy came to life in every possible dimension, seemingly as a dangerous deterrent as well as a valiant saviour. The now-evicted leader of the organisation was trying certainly, among every other motive, to disconnect the family presence on the biggest chair from the corporate legacy as brought to life by generations of outstanding professionals. When such endeavours ran into a fundamental conflict, then the DNA had to work on overdrive to restore equilibrium, as part of a deliberate interim strategy whose success we cannot vouch for. Once again, a non-legacy boss has been named who will certainly do his best to reiterate the unique credentials of the organisation, in this case wisely balancing the family name with the organisational fame.
In sum, I would strongly urge every brand unconnected to stature or age to have a finely-manicured DNA Dichotomy strategy to ensure that the founders only add to the foundation without ever taking back. This can well mean that even when the going is great, the critical contribution of individuals to consumer equity must be systematically reduced, the value proposition of the brand taking over resolutely. Lineage can be a double-edged sword and we must be ready to handle every possible negativity.
(Shivaji Dasgupta is the Founder of INEXGRO Brand Advisory and can be reached at:Â firstname.lastname@example.org)
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