19© 2013 Wiley Periodicals, Inc.Published online in Wiley Online Library (wileyonlinelibrary.com). DOI 10.1002/ert.21395

Who of the following would you rather work for: a hotel that offers super-lux

accommodations or a hotel committed to giving its customers the over-the-top experi-ence you’d want to have in your best hotel stay ever? If choosing between a company that prides itself on making the lowest-cost heart defibrillators and a company that saves lives every day, which would be your choice?

If you chose the second option for both, then you are starting to sense the motivational power of internal branding. Companies that integrate brand distinctiveness into the cul-ture and use it to guide employee action have a head start on employee motivation. The simple truth is that people want to work at places where what they do resonates deeply with their beliefs and goals.

Emotional resonance can be as simple as being excited about going to work or can tie to a deeper need for creativity and doing work that matters. Internal branding, done well, builds employee commitment by offer-ing clarity, reinforced through culture and a company’s strategic direction.

Far from being a soft business strategy, building employee commitment to your brand has a direct customer benefit. Happy employ-ees create emotional bonds with customers that result in such bottom-line advantages as product preference, higher repurchase rates, product price premiums, and positive peer recommendations.

Internal branding recognizes that doing business can’t be separated from our hard-wired nature to look for meaning and build relationships. Effective internal branding employs brand tools stated as principles that guide company direction and help strengthen culture. Two brand tools that are essential for employee motivation that I describe in this article are cultural norms and strategic role.

TURNING CULTURE INTO ACTION

Cultural norms are the behaviors that employees cite when they take action. They are fundamental to employee motivation because they speak to the reality that all organizations act as distinct social groups, each with its own unique expectations and power relationships. While HR often spends a great deal of time training employees on how to be more effective, most employee training is lacking when it comes to helping employees build competitive differences. If two competitors create workforces that are equally productive, how will that help cus-tomers choose one over the other? Cultural norms offer both emotional reinforcement and direction for effective employee decision making.

Cultural norms are phrases that leaders and employees use to guide and justify deci-sions. Here are some examples:

The Impact of Internal Branding on Employee Motivation and Competitive Advantage

F. Joseph LePla

F. Joseph LePlaEmployment Relations Today DOI 10.1002/ert

Employment Relations Today

20

gives permission for innovation while helping to build consensus around that decision.

There is another reason why you want to actively manage cultural norms. A company’s organic mix of norms probably does not facilitate optimal decision making, because you may have one or more negative norms that work at cross-purposes. One of the most common in larger companies is: “No one ever gets fired for the safe choice.” In fact, this norm is often the result of a lack of norm definition or attention paid to defining the company goals. In companies where norms aren’t clear and, hence, where there is little trust, this belief that caution is rewarded can deep-six entire product initiatives.

A related issue is where a seemingly posi-tive norm creates poor decisions. The norm of “we practice respect for each other and our customers” can turn an organization into one where bad decisions are enabled and the benefits of collaboration are eroded all in the name of respecting others. When respect is interpreted as not making waves or questioning directions, it hinders collaboration.

When starting on the road to manag-ing your norms, seek balance. In the above case, for instance, along with a norm around “respect,” make sure you have one around the important role of “questioning or testing proposed actions.”

Although cultural norms typically start by employees’ observing and emulating senior managers, after a while, they take on lives of their own. Norms helped the Four Seasons Hotels and Resorts define “who we are and inform the decisions we make.” Four Seasons’ cultural norms include “Do unto others as you would want them to do unto you” and “Experiences of exceptional quality.” These, in turn, have steered it toward hiring only people who genuinely like people.

• We reward initiative.• We always put the customer 2 rst.• Questioning is an important part of quality.• We practice respect for each other and our

customers.

Values and cultural norms are closely related concepts—beliefs that guide com-pany and employee actions. The differences between the two center on how they are held by the company. The term “cultural norms” first recognizes that these are beliefs that exist within the culture, and, second, that they are norms—commonly held standards for action. It’s also very helpful to employ-ees to identify and clearly state the action expected—by stating norms for guiding action as well as giving examples of how other

employees are using them, norms move out of being nice statements, which often hap-pens to values, and become useful tools.

Employees use norms to justify actions tothe group. This makes it safer and easier to make decisions that will have a greater chance of being accepted—hence, norms relate directly to job success. They have the added benefit of speeding the decision pro-cess because groups will apply similar norms to a given problem. How are they used by a given employee? Take “rewarding initiative,” for example. Let’s say sales leads have been declining for several months and you are the marketing director. You might say: “Since we reward initiative, I’ve decided to institute this new inbound lead program without waiting for the next planning cycle.” Here, the norm

A company’s organic mix of norms probably does not facilitate optimal decision making, because you may have one or more negative norms that work at cross-purposes.

Spring 2013

The Impact of Internal Branding on Employee Motivation and Competitive AdvantageEmployment Relations Today DOI 10.1002/ert

21

speechless, and the event turned into an internal branding legend.

The results for the bottom line have been significant. Four Seasons has expanded to over 90 hotels in 36 countries and has received more AAA Five Diamond awards than any other hotel company. The Four Seasons is also only one of a handful of firms that have been on the list every year since the launch of Fortune magazine’s Top 100 Companies to Work for in America in 1988.

The second company I referred to at the start of this article—where employees

go to save lives every day—is Medtronic. Medtronic has created a culture around story-telling so that employees understand the impact they have on the people who benefit from their pacemakers and other life-saving products. Patient stories bring immediacy to the brand, keep company norms front and center, reconfirm why employees work there, and give employees continuous emotional reinforcement. Here are some examples of how Medtronic uses stories:

❏ A salesman drives miles at night to deliver equipment needed immediately to treat a patient.

❏ The founder, Earl Bakken, goes out of his way to talk to patients and then shares those stories with employees.

❏ Website stories offer something for every-one under categories of “Economic Value, Clinical Outcomes and Societal Impact.”

Four Seasons’ cultural norms help them rapidly develop service innovations. A door-man who noticed that joggers often drank water on their return to the hotel decided to greet each jogger with a bottle of water (“do unto others,” “experiences of exceptional quality”). The concept went over extremely well and was translated into a best practice to all Four Seasons properties within one week of the decision. Using norms as part of employee management and service develop-ment reinforces other Four Seasons norms of “respecting each other’s contributions” and “working together cooperatively.”

To ensure that the culture and cultural norms were alive and well, Four Seasons employees fill out an annual questionnaire consisting of 200 to 300 questions as part of their formal review process. No problem is too small to escape the immediate con-sideration of senior management. Because senior managers also walk the talk, they treat employees as they would want to be treated—reinforcing the emotional resonance of this norm.

Management and staff share and nurture stories of extraordinary service, which, in time, can become legendary. Take, for exam-ple, the delivery of a common cup of coffee to a popular satellite radio talk show host by the general manager of the Four Seasons of Boston. Through a couple of miscues by the Four Seasons’ staff, this celebrity did not get the cup of coffee he anticipated during a stay. He vented his frustration on national radio. The general manager of the Boston hotel, hearing the newscast in the morning, managed to bring down, while dressed in the uniform of the service staff, coffee and sundry treats to him and his staff while they were broadcasting live. According to a well-placed source, it left the host momentarily

Medtronic has created a culture around storytell-ing so that employees understand the impact they have on the people who benefit from their pacemakers and other life-saving products.

F. Joseph LePlaEmployment Relations Today DOI 10.1002/ert

Employment Relations Today

22

of the company has been to keep car occu-pants safe. Further, they’ve put this notion into action through accident research and innovations, including the shoulder har-ness and rearview blind-spot camera. Volvo employees know that the focus on safety starts with them—employees are empowered to create a safe work environment—a natural extension of the strategic role. Companies that choose to go wholeheartedly into inter-nal branding are standouts, and their success becomes more obvious over time.

One way to really cement the strategic role with employees is to use it to make their jobs better. Some companies develop initia-tives early in the game that create greater employee buy-in or educate on ways employ-ees can act on their strategic role. For Seattle-based Salal Credit Union, the strategic role is “Your money management made easy.” Tradi-tionally, Salal had had a reputation for help-ing its members with all things financial. But to do this, customer representatives needed todevelop a series of workarounds from loan applications on—to make things very easy for customers. This made work more difficult for employees who sometimes had to use heroic efforts to satisfy customers.

Shortly after determining its strategic role, Salal created an internal branding initiative to create a searchable, real-time knowledge base housing all data, policies, processes, and procedures specifically to assist employees in their work.

Salal’s rationale was that current and future employees needed to consistently deliver their brand promise. Therefore, it was critical that employees have access to the information they need to make money management easy for members. Although many financial companies invest in informa-tion technology, Salal’s decision to design it

What are the results of internal brand-ing at Medtronic? Eighty-seven percent of employees indicate that Medtronic’s mission is consistent with their personal values, and an amazing 92 percent believe the work they do supports the mission.

STRATEGIC ROLE: MARRYING EMPLOYEE MOTIVATION WITH THE BUSINESS GOAL

Although cultural norms give employees guid-ance on the day-to-day “whys” for what they are doing, a strategic role provides the under-pinning for creating value for the customer. Too many HR branding initiatives separate the employee brand experience from the customer brand: Effective internal branding ties employee action directly to the customer experience. When employees clearly under-stand how to build compelling brand value, the employee brand becomes indistinguish-able from the company brand. A strategic role gives employees the opportunity to find greater meaning and satisfaction in their work because it creates great directional clarity.

A strategic role supplies the answer to why prospective customers must consider you. It defines the organization from a cus-tomer point of view, speaking to the need the organization fills in the customer’s profes-sional or personal life. Without a strategic role, your brand effectiveness will lack a compelling, big-picture, customer-oriented focus. Employees will be motivated to sup-port the brand only when they clearly under-stand what actions they can take to make it successful. It will help employees determine what is on-brand or off-brand while keeping company management out of the rule-making business.

Carmaker Volvo has a strategic role of “building safe cars.” Since the 1920s, the goal

The Impact of Internal Branding on Employee Motivation and Competitive AdvantageEmployment Relations Today DOI 10.1002/ert

Spring 2013

23

one another out . . . [and] to make all clinical decisions on the basis of what is best for the patient.”

Another important measure of success for Mayo Clinic is its ability to keep the right people. Because so much of its external suc-cess depends on the quality of its internal branding efforts, hiring, training, and retain-ing those who can deliver on that brand promise are keys to success. Benchmarking Mayo Clinic against industry peers reflects its success; whereas the nurse turnover rate industrywide is 20 percent, for Mayo Clinic in 2003, it was 3 percent at Rochester and

7 percent at Scottsdale. Physician turnover at Mayo Clinic in 2008 was lower than 6.9 percent, less than half the national average.

STEP-BY-STEP GUIDE TO REVEALING CULTURAL NORMS

Whether you are already on the road to being norms-driven or this is your first foray into using these tools—we recommend fielding research to determine what norms currently exist in your organization. Start with an online questionnaire to senior management, department heads, and employees who dem-onstrate leadership skills. Ask each group these questions:

1. What do you find meaningful about our company or your job?

so that it enabled employees to make it really easy for customers reinforced its strategic role in a way that was very impactful to every employee. In addition to making cus-tomers’ lives easier and building loyalty, this program also featured workforce paybacks that included reduced training needs, mis-takes, and employee turnover.

Another brand that’s done a great job with motivating employees via a strategic role is Mayo Clinic. Its strategic role can be stated as “Collaboration among physicians to get to the right answer” and to always keep staff acting on the principle of “The patient comes first.” Doing what was in the interest of the patients resulted in all employees asking themselves the question, “Is this best for the patient?” as they went about their daily work.

Mayo Clinic’s approach to internal brand-ing echoes its approach to patient care, reflecting dedication to consistency and inte-gration. An outside consultant observed that the Mayo Clinic brand “is created every day by every employee in every interaction with every patient,” though within the organiza-tion the word brand isn’t used. The success of the word-of-mouth branding approach abso-lutely depends on the near perfection of care delivery; employees are the primary brand demonstration and communications channel.

One of the ways Mayo Clinic supports its strategic role is to find people who are motivated by teamwork. Once a clinician is on board, Mayo Clinic reinforces the team approach and the importance of delivering quality care through its compensation struc-ture. Almost all employees are on salary, so there is no incentive to rush patient care or to be territorial about case management. According to one surgeon, “by not having our economics tied to our cases, we are free to do what comes naturally, and that is to help

Although many financial companies invest in information technology, Salal’s decision to design it so that it enabled employees to make it really easy for customers reinforced its strategic role in a way that was very impactful to every employee.

Employment Relations Today

F. Joseph LePlaEmployment Relations Today DOI 10.1002/ert

24

Internal branding pays off in higher levels of employee motivation and customer sat-isfaction. And those benefits, based on my experience, are augmented by additional HR benefits that can include a higher job-offer-to-acceptance rate and employees who are willing to trade a percentage of salary for branded job experiences that they strongly identify with. In surveys we’ve conducted over the years, we’ve found that employees who are extremely committed to their com-panies also said they would be willing to work for up to 15 percent less than if they worked at competitive firms. Although this may sound farfetched, consider your own situation. Would you prefer the highest salary at an undefined or unknown brand or take less money to work at a company with a very well-known brand that you find inspiring?

Although many companies think of employee motivation only in terms of job sat-isfaction, brand moves employees into a differ-ent territory—one where alignment with the central mission of the company and a strong, supportive culture become prime motivators. To reach this goal, internal branding has to be about more than just good communications or the right financial incentives; it must be an integral part of why and how people work.

2. If a prospective employee asked you how to get ahead at the company, what would you say?

3. What are the ways we do things around here? If someone makes an important deci-sion, what do they say about the way the company operates to justify this behavior?

4. What kinds of behaviors are rewarded here? 5. Which employee behaviors would custom-

ers say are important to them?6. What would customers say are the behav-

iors that detract from their experience?

Review each answer and gather common ideas. Typically, you’ll end up with a manage-able list of concepts. Use this list as a starting point by eliminating redundancies, discuss-ing the relative merits and importance of each norm, and creating an integrated set of norms to manage from in the future. During this process, you will likely find that there are areas that you’d like to see norms where none now exist as well as negative norms that you want to eliminate. To do either, you’ll need to create a plan, complete with milestones.

Managing to norms requires that these become part of employee job descriptions, be measured each year, and be integrated into internal communications.

F. Joseph LePla is a principal strategist in the Strategy group at GreenRubino, a full-service branding, marketing, and advertising agency located in Seattle, Washington. He was an early innovator of internal branding methodologies and has worked with over 300 companies since the early 1990s. GreenRubino’s Strategy group helps clients define and operationalize internal branding programs. LePla is coauthor of three books on internal branding, including the recently published Create a Brand That Inspires: How to Sell, Organize and Sustain Internal Branding (AuthorHouse, 2012); Brand Driven: The Route to Integrated Branding Through Great Leadership (Kogan Page, 2003); and Integrated Brand: Becoming Brand-Driven Through Companywide Action (Quorum Books, 1999). He may be contacted via e-mail at joel@greenrubino.com.