Increasingly, senior business and communications executives are encountering the subject of corporate positioning. And for good reason. The corporate landscape is being reshaped at an unprecedented pace. As a result, smart decision-makers are recognizing the value of defining their company's corporate position to accurately reflect its strategic intent, and to guide how the corporation will behave in the marketplace and toward its employees. Without an understanding of corporate positioning, companies will eventually find that competitors, financial analysts and the media, among others, will create one for them. It is vital that a company create its own definition of who it is or somebody else will do the job.
Before we define what a corporate position is, let's examine what it is not. First, it is not a slogan, although slogans derive from and reinforce corporate positions. "The best engineered car" has been Mercedes-Benz's slogan. The slogan clearly reflects the organization's position as an outstanding automotive company. And few would disagree.
Second, a corporate position is not a list of products and services. Competitors may offer the same list. A list of products and services doesn't tell anybody anything about an organization's unique qualities.
Likewise, a corporate position is not a list of the businesses a company might be in. That might say something about the markets an organization serves. But it says nothing about the benefits and advantages offered to customers.
A marketing strategy is not a corporate position, although a well-defined corporate position should be the basis for a marketing strategy as well as other strategies such as mergers and acquisitions, product development, investments and so on.
There's no question that corporate identification is an important issue in its own right, but it shouldn't be confused with corporate positioning. Identification deals with the name of the company and the symbols that represent it.
So then, what is a corporate position? Developing and presenting a corporate position is a disciplined effort by an organization to define how it wants to be perceived by its most important audiences, based on thorough research and analysis of distinguishing characteristics and unifying attributes.
The corporate position is quite different from a corporate image. Image is what audiences think of an organization. The corporate position, on the other hand, reflects what an organization wants people to think about it.
Aim position at future
An effective, meaningful corporate position must pass several tests. First, it must be aimed at the future, because that's where we are heading and that's where we'll spend the rest of our lives.
Second, it should give cohesiveness to the company. One objective of the corporate position is that it must be able to support various organizations with the strength of the entire company's distinguishing attributes. A corporate position must also be credible and truthful. No company has the resources to buy credibility in the marketplace or within employee ranks for something false and unbelievable.
A corporate position should also speak in human terms, primarily because that is how an organization relates best to its publics and is most clearly understood and remembered. Finally, the corporate position should also be something the organization stands for. Using the Mercedes-Benz example, again, it's clear what this company stands for: the best in automotive engineering. At McDonald's, the company stands for quality, value, service and cleanliness. The organization is also known for a commitment to contributing to the communities in which it does business.
Corporate positioning offers benefits to those companies and organizations that rely on it as a baseline for consistent communications. First, it explains to a company's audiences "who we are." Take Ford Motor Company for example. The position Ford has been building itself around is one based on quality--a position easily recognized by its suppliers, dealers and customers. For employees, the theme "Quality is Job 1" translates meaningfully into their everyday assignments.
Framework for strategic planning
A second benefit of corporate positioning is that it lays out a framework for strategic planning. Mercedes-Benz is not likely to build cars to compete with Yugo or Hyundai as long as its position commits it to excellence in automotive engineering.
The third benefit is that a corporate position provides the basis for coherent, unified long-term objectives. One of the best examples is found at Northwest Airlines. After the company was purchased by a group of private investors, the newly installed management team defined four corporate objectives that today are shared by everyone at all levels of the company:
"It is Northwest's intention, and therefore |that of~ all of its people, to become the preferred airline in the industry, to be the best airline to work for, to be the best managed airline, and to be an outstanding community citizen."
Now one might think: that's simple enough--who wouldn't say something like that. However, that kind of thinking misses the point. A lot of companies don't say it, or couldn't say it because they haven't taken the time to define it.
Try this simple exercise: Ask three or four associates to state simply what your organization stands for. If you get three or four different answers, the red flag should go up.
Try the same exercise with Northwest's employees and you'd find they would be able to recite those four corporate objectives with confidence. Imagine the power of an organization when everyone understands a common set of objectives and is moving toward these goals.
Has this attempt at corporate positioning worked for Northwest? In just a few short years, the airline has gone from the back of the pack in many customer satisfaction surveys to front-runner. One specific example is that today, the company is the number one on-time airline in the country. Clearly, Northwest's desire to become positioned as the preferred airline has worked to focus its employees on keeping the planes flying on time, among other things.
Assess audience perceptions
In the corporate positioning process, it is vital that the first step be an honest assessment of the perceptions held about the company by its most important audiences, beginning with employees. It is a process that involves gathering quantitative and qualitative information about the company from internal and external sources.
Depending on circumstances and the objectives of senior management, it is sometimes difficult to determine the priority and weight each audience should be given when developing the corporate position. Employees, however, deserve to be at or near the top of the list. Countering negative attitudes and motivating employees toward a positive pursuit of corporate objectives is a requirement and represents a significant business challenge for many companies today. Clearly, getting employee buy-in is of major importance.
Once the corporate position is defined, it needs to be communicated through key themes or messages and corporate identity. The corporate position serves as the linchpin for all communications activities, forming the basis for what you want to be saying and how you want to say it. The two elements of content and design are consistently and repeatedly merged into all communications to key audiences. This process helps an organization build favorable, productive long-term relationships.
Once you get into the actual vehicles for delivering the message, the corporate position provides the framework for all communications, including annual reports, sales brochures, employee newsletters and speeches. Take advertising as an example. The corporate position is a major influence from the outset, beginning with the advertising promise and creative objective.
Honeywell provides a good example of this relationship. Here's the company's positioning statement: "In 1987, Honeywell rededicated itself to a century-old heritage: helping people control their world. Control technology began with a Honeywell invention. It grew with Honeywell innovations. It remains the core of our business, as we provide control that enables people around the world to live better and work more productively."
The company's corporate advertising is based on this promise: Honeywell controls help solve contemporary business challenges, thus meeting and addressing real human needs. The advertising reinforces the company's position through the corporate tag line: "Helping you control your world."
The corporate position also guides the company's public relations efforts. When dealing with news reporters, Honeywell is always on the lookout for products and technologies within the company that provide a good example of "Helping you control your world."
Since the company knows what to look for, it's been quite easy to identify and pursue appropriate opportunities for publicity. Good examples here would include Honeywell's work on aircraft collision systems and wind shear detection systems, and advanced automation systems for the home.
Look beyond quality
A recent issue of FORTUNE magazine devoted itself to the most highly regarded corporations in America. Many of the names on this corporate list are familiar, such as Merck, Levi Strauss and Rubbermaid.
FORTUNE stated: "These companies realize the importance of staying focused on the business that earned them their fame." The article also pointed out that successful companies today understand that their customers are looking beyond quality for something more.
"If the 1980s are remembered fondly for anything," FORTUNE said, "it is that they created the sharpest, most educated customers marketers have ever faced.... They still want the best you have to offer ... but they are also interested in what your company stands for."
To successfully meet that customer demand requires investment in developing a corporate position statement.
Tim Morin is vice president, Tunheim Santrizos Co., Minneapolis, MN.…