A good corporate identity can be an elusive thing. The right one will boost sales and even help a company establish a worldwide presence. The wrong one could mean conceding market share to competitors, turning off customers, or losing jobs. Too many companies in the United States today lag their foreign competition in the identity department, argue a number of consultants, who are offering their services to corporations interested in presenting a better, or at least a more visible, image to the world.
``The most important strategy for a company is to have a precise articulation of what it is and where it wants to go. If you have no road map, your business is in great trouble,'' says Clive Chajet, chairman and chief executive officer of Lippincott & Margulies Inc., a management consulting firm here.
The need for a strong corporate identity, says Mr. Chajet, has been intensified by the recent rush to more and larger leveraged buyouts (LBOs), by which entire corporations or well-known divisions within corporations can disappear or be restructured overnight.
Seeking a clear public presence, of course, has always been an objective of most leading businesses. Companies have usually sought to hammer out a clear public recognition through an identifiable name (General Electric, IBM, or RCA, for example), or a widely-known trademark or advertising symbol (the Morton salt girl, or Buster Brown, for example). But today, according to specialists like Chajet, the need for ``identity'' goes beyond an advertising symbol or brand name.
``In an era of international change,'' Chajet says, where many companies are now giant conglomerates or the product of a merger or acquisition, ``it's vital that a company is understood for what it is now, as opposed to what it was yesterday.'' That image, Chajet says, must be directed at three target constituencies: the company's investors and employees, as well as its customers.
``Asians have spent a good amount of time and money on corporate identity,'' says Michael M. Smith, president of Larimi Communications Associates. ``A few years ago anything Japanese was considered junk. Now it's the very symbol of quality.''
Indeed, the corporate identity challenge has become so acute in the US that the Conference Board, a business-information organization, will play host for a conference on the subject later this month in New York. There is a particular need for many medium-sized businesses engaged in global commerce to have more information on the need for corporate identity, Mr. Smith says.
Overseas companies, or their US subsidiaries, Smith notes, have tended to lead the US in the image business. Case in point: BP America Inc., the US subsidiary of British Petroleum Company, has announced that it will create a single name this year for its 7,000 gas stations in the US. BP America currently markets its products under a number of logos, including Sohio, Gulf, and Boron.
A crucial reason for establishing a precise identification, says Chajet, is that many US firms must now go abroad for their financing. Competition for overseas capital is expected to intensify as the 10-nation European Community gets closer to 1992, when most national trade barriers will be eradicated in Western Europe.
For a typical middle-sized company in the US, a consulting study can cost from $250,000 to $350,000, says Larry Ackerman, president and CEO of Identica, a consulting firm in New York. Using focus groups, Identica attempts to single out how a company goes about ``establishing value,'' Mr. Ackerman says. ``We strip out assets,'' he says. Personnel, not products, are the key to the firm. In other words, the consulting team is looking for what can be described as the ``mind set'' of the employees, their talents, the ``unique contribution'' that they - and, thus, the company - offer to the marketplace.
Identica looks at three main aspects of a firm's day-to-day work: communication, strategy, cultural development. But Ackerman stresses that the analysis is not quantitative. Rather, the emphasis is on the contribution of the employees. This is what really establishes a company's identity.