Introducing a departmental branding model to improve the visibility and legitimacy of internal support functions

Abstract

Branding for its part has experienced similar to marketing a broadening of the concept (Bastos and Levy 2012; Merz, He, and Vargo 2009). From being seen as a sub-discipline of marketing focusing only on product attributes (Louro and Cunha 2001), the relationship-focus era (Blackston 1992; Webster 2000) with its shift to brand value co-created by all stakeholders of the brand, has paved the way for branding to broaden in its own right (Ballantyne and Aitken 2007; Brodie, Glynn, and Little 2006). However, for the particular area in the organization – the department itself – only little research can be found on the application of branding in an inter-departmental context of a corporation (Beck 2010; Benson and Kinsella 2017; Cheskis 2012; Esser and Schelenz 2011; Jessl 2010; Rahman and Areni 2010; Siems and Lackus 2010). For instance, Siems and Lackus (2010, p. 32) observed: “what remains neglected is the understanding of internal customer-supplier relations and the relevance of branding in this relationship as an essential element of internal marketing (…). This is interesting – and important – because the sub-units themselves can represent the own brand and brand personalities: Internal services can be ‘internal brands’.” Within the organization, departments compete for scarce resources such as power, budget, personnel, top management awareness, recognition and legitimacy (Hybels 1995; Tyler 2006; Verhoef and Leeflang 2009; Webster Jr., Malter, and Ganesan 2005). In particular, internal support functions face challenges in their internal market for visibility and legitimacy e.g. due to their subordinate and “invisible” position in the value chain (Menon 2012; Park et al. 2012; Porter 1985; Rust et al. 2004). Despite there being a need for departments to position themselves in their own competing environment, there is no branding model with which such a sub-organization can address its market and business challenges. This thesis is a first attempt to close this research gap by proposing and discussing a model for departmental branding that can be applied to internal departments. The model shows what elements and stages comprise a departmental branding model and how it can contribute to improving visibility and legitimacy. Of particular note is next to the aspect of brand identity the central importance of employee branding as being a source of high influence on the brand equity for internal departments. Structural equation modeling (SEM) was used to identify the determinants of departmental brand equity. It could be revealed that departmental brand trust, predicted by communication and customer-supplier relationships, has the strongest effects on departmental brand equity. This allows to conclude that departmental brand equity is built through the internal customer’s social interactions and relations with the department’s employees. Finally, an action-oriented case study was conducted to provide practical insights into the application of departmental branding for the purpose of increasing the visibility and legitimacy of an internal support function. Learnings are discussed as well as facilitators and barriers derived for the successful adoption of the departmental branding model in future research.