Brand & Culture

How professional service firms build strong external brands upon strong internal cultures.

A strong external brand and a strong internal culture are two sides of the same coin when it comes to professional service firms – they are different things but so interdependent and fundamentally linked to each other that one cannot exist without the other. Leaders of professional service firms are best placed, in terms of the organisational levers they can pull, to connect the two in developing a compelling and authentic brand strategy.

CORPORATE ZEITGEIST

The interdependence of culture and brand has been climbing up the corporate branding agenda rapidly for a decade or more.  The meteoric rise of tech brands like Apple, Google and Facebook and the more sedate but relentless rise of corporate brands like Unilever, Zara and Nike has demonstrated, to even the most cynical investor, that businesses with strong, authentic internal cultures produce external brands with sustainable long-term advantage.

Recent research from EY and Harvard Business Review found that organisations with strong cultures and purpose performed far better across a range of performance measures than those without. In professional services, the interdependence between internal culture and external brand is arguably even more intrinsic and vital because the client experience is delivered directly and exclusively by people who work for the firm – with no 3rd party retailers, showroom staff or franchised store owners to get in the way.

Anyone who’s worked with or for Goldman Sachs will know that the firm has a powerful and distinctive culture.

Culture has always been taken seriously by leaders of professional service firms – at least those with their eyes open. What’s new is that culture is being taken today to mean more than how the people in the firm ‘rub along together’ – for better or for worse – but rather, how they collaborate in the service of the firm’s clients and how they project the image of the firm to prospects.

Most firms these days have what’s called an ’employer brand,’ but if that isn’t joined at the hip with the external brand strategy, it’s unlikely to galvanise the kinds of attitudes and behaviours among their people that the leaders want to see. A good brand strategy should be ambitious, stretching, and demanding – but without this tension, employer brands can become too soft and cuddly.

FIRST AMONG EQUALS

Two iconic professional service firms stand as shining examples of strong external brands that are fundamentally intertwined with strong internal cultures: Goldman Sachs and McKinsey & Co.

Anyone who’s worked with or for Goldman Sachs will know that the firm has a powerful and distinctive culture. There are enough anecdotes about it to fill a book (and they have) but Hank Paulson (Former GS Chair and Secretary of the US Treasury) captured it well in an Economist interview when he said, “It’s a hard place to be hired, a hard place to be promoted and a hard place to stay”. In a word, the internal culture and the external brand of Goldman Sachs are connected by being ‘uncompromising’ in the pursuit of excellence. Not a place for everyone – but that’s not the ambition, the goal is to do whatever it takes to be the best and only the best.

McKinsey has an equally powerful culture, but one that although also dedicated to excellence has a slightly less aggressive and more cerebral approach to their goal – one of ‘rigour.’ Legend has it that in the guise that led to the current McKinsey the partners sat down sometime around 1932 and produced a paper – some might have called it a brochure! ­– that laid out the principles of the firm that they intended to build. One that would bring a culture of rigour (borrowed from the legal training some of the partners had experienced at law firm Jones Day) to the then more anecdotal business of ‘management efficiency’ as it was called then.

1932 is a very long time ago but those who’ve worked at or worked with McKinsey in the intervening years will testify to the rigorous attitude towards everything from hiring, promoting and firing through to the focus on evidence and facts to support their recommendations on strategy to clients. It’s no accident that the McKinsey internal research lab is called the McKinsey Global Institute. Everything about it, including the name, screams academic rigour.

Both examples demonstrate that the internal culture (aka the employer brand) need not be limited to warm words and gentle encouragement. These firms have extremely demanding internal cultures that the leaders would say are important in shaping the behaviours and attitudes among their people to deliver a superior service for their clients.

STAND FOR TO STAND OUT

So, what does all this history mean for leaders of today’s professional service firms looking for sustainable competitive advantage? Simply that a strong and authentic external brand is built on a strong internal culture – one which includes the essential but more hygiene-level components of being ‘nice to each other’ and ‘striving to serve clients’ etc. but also elevates things to a level of focus and distinctiveness that not all firms could, or even would, sign up to.

The start point is to look at what you’ve got already ­– any firm that is even alive today let alone thriving is without a doubt doing something right already.

That level of differentiation, at the core of what a firm stands for, begins to become a source of external brand differentiation in the market place if carefully nurtured and appropriately channelled into the day-to-day work done at the coal-face for the firm’s clients.

Goldman and McKinsey may be genuinely iconic brands in their fields and tough to replicate, but they can be studied, and best practices disseminated that can be applied to firms today facing the challenge of differentiating themselves in the global professional services market. The start point is to look at what you’ve got already ­– any firm that is even alive today let alone thriving is without a doubt doing something right already.

The challenge is to identify what’s ‘useful’ and what’s merely ‘there’ and then to ensure that the external brand is driven from the elements of the firm’s culture that have teeth in the market place and can be globally applied — no mean feat.



Ian Stephens

CEO and Founder of Principia, the world's most experienced branding and innovation consultancy for professional service firms.