Managing Organisation’s Internal Reputation: A Comparative Study of
Two Branches of ABC College
Rabiah Adawiah Abu Seman1 and Zulhamri Abdullah (PhD)
2
1Stamford College, Malaysia, [email protected] 2Universiti Putra Malaysia, Malaysia, [email protected]
ABSTRACT
The purpose of this paper is to analyse employees’
perception towards organisation’s internal
reputation and to identify the best predictor for
internal reputation measurement in different
branches. A comparative survey adopted from
WorkRep model has been conducted on 221
employees from Melaka and Selangor branch of an
education institution. This study indicated
education institution in Melaka branch
outperformed internal reputation of Selangor
branch. Leadership and performance element is the
most influential factor indicating employees’
perception towards organisation’s internal
reputation followed by products and responsibilities
in both branches.
Good ‘leadership and performance’ contributes the
most to an organisation’s internal reputation as it is
able to outshine other dimensions. Most employees
show their big support to organisations that have
good ‘leadership and performance’ and they are
willing to accept weaknesses of other dimensions.
‘Total reward’ and ‘work environment’ factors are
almost as equally important as other dimensions to
a moderate internal reputation organisation with a
weak measurement of ‘leadership and
performance’. Leaders play important role in
decision making which require practicing empathy
and having a better communication with employees
in building a good internal reputation.
‘Leadership and performance’ is very influential
and need to be stressed out in improving internal
reputation of ASEAN education institutions in
corporate communication context.
Keywords: Internal Reputation, WorkRep,
Supportive Behaviour, Branch Comparison.
I INTRODUCTION
Business today has never been the same as it was
50 years ago. “Public’s expectations of corporations
are also different from what they were 50 years
ago” (Argenti, 2009). In meeting various different
expectations from its constituents organisations
have to adapt to new environment changes,
strategic communication needs to be implemented
and it applies to large corporations and also small
businesses. Strategic communication management
is crucial in determining organisation’s success
(Argenti, 2009).
Corporate reputation is one intangible feature which
is able to influence customers, employee, investors
or other stakeholder’s decision on any action or
behaviour towards a company. It lies in the
stakeholders’ perception of the value and image of
the company, ‘in the eye of the beholder’.
Reputation is not easy to be built; it can take a
lifetime to build and merely a second to destroy it.
A tremendous corporate reputation is definitely not
the main goal of the company in achieving success
in their field. The most important thing is to get all
stakeholders; customers, investors, suppliers and
especially the employees to support them
(Rotterdam School of Management, 2008). This
support can be in any aspects such as purchase of
stock market or products, proudness of working
with the company, commitment with the company,
brand loyal and others. Fombrun and Shanley
(1990) explained that “corporate reputation enables
organisations to gain public recognition, charge
premium prices, attract talented workers, enhance
their access to particular markets and attract
investment” (Harvey & Morris, n.d, p.2).
According to Caes B.M Van Riel, corporate
reputation is “the collective representation of firm’s
past actions and results that describe the firm’s
ability to deliver valued outcomes to multiple
stakeholders” (Rotterdam School of Management,
2008). It is built through the experiences of
stakeholders, corporate communications and media
coverage about the organisations. Strong corporate
reputation will result in strong market value as it
gain trust and support from all stakeholders such as
employees, consumers, clients, media,
shareholders, government and suppliers. This will
also result in strong competitive advantage as it
gain support from all stakeholders. Companies with
strong corporate reputation are able to attract more
employments and has low turnover. This is due to
public and employees’ trust towards company’s
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
strong economic value. The company is believed to
have a strong capital that it will not go bankrupt and
their welfare is well taken care of. A strong
company like this attracts more investment which
will build their strong foundation and increase
ability to expand the business. Suppliers fights to
win the tender to supply products which will benefit
the company in getting supplies at lower cost.
Strong corporate reputation companies are always
favoured in collaboration with any other
commercial or non-commercial institution or
organisation (Rotterdam School of Management,
2008).
Argenti (2009) explained “reputation is different from
image because it is built up over time and is not simply a
perception at a given point in time – it is product of both
internal and external constituencies” (p.91). Reputation
comes from long years of perception from the
stakeholders towards a company. Stakeholders perceive it
through their experience, family and friends’ experiences
and also from the media such as television, radio,
newspaper, magazine or internet. Information gained
from these experiences builds the image and over the
years it builds the reputation of the company as being
good or bad.
Michelon (2011) quoted Roberts, Dowling (2002)
and Little (2000) that “reputation can be defined as
an organisational attribute that reflects the extent to
which stakeholders see the company as a good
corporate citizen, and it, therefore, constitutes an
intangible asset with the potential for creation of
value” (p.80) Fombrun and Van Riel (1997) also
defined reputation as “subjective collective
assessment of the trustworthiness and reliability” of
companies (Michelon, 2011, p.80).
According to Charles Fombrun, to build a good
reputation, it is important to concentrate on creating
and building a distinctive corporate identity. From
there, the good and coherent corporate image has to
be projected to the stakeholders and maintain
though times (Argenti, 2009). Corporate identity
plays a very important role in building and
maintaining corporate reputation of a company.
Corporate reputation derives from the perception of
the stakeholders which includes their “expectation”,
“attitudes” and “feelings” towards company’s
image and the real value image which projected
from the corporate identity of the company
(Argenti, 2009).
Internal Reputation. For an academic institution,
the internal stakeholders are students and
employees. Internal reputation is constructed from
internal stakeholders’ perception and emotional
attitude towards an organisation (Chun, 2010).
Grandison and Sloman (2000) quoted ‘emotional
appeal implies respectability, appreciation and
trust’ in explaining emotional bond (Karak, 2010,
para 23). Positive or negative feelings or attitude
towards an organisation represent the perception
which is the reputation of the organisation.
Organisation’s internal reputation is built on the
degree of employee’s emotion on the organisation
and perceives the organisation (Chun, 2010).
Emotional Bond is also explained as employees’
satisfaction towards employer. Davies and Chun
(2002) defined employees’ satisfaction as “degree
which an employee has positive emotions towards
the organisation”.
Figure 1: WorkRep Model
Dr Charles Fombrun from Reputation Institute has
developed WorkRep model (Figure 1) in studying
workplace reputation among employees which has
been derived from Reptrak model. It has been
widely used in measuring workplace reputation
among the key stakeholder employees in
organisations around the world (Reputation
Institute, 2011). Pulse in this model or Emotional
Bond are same as Pulse in Reptrak’s core. Degree
of reputation is measured by the degree of
employees’ trust in the organisation, employees’
good feeling towards the organisation, employees’
admiration on the organisation and esteem towards
the organisation.
There are only 5 dimensions that drive the
workplace reputation and it is also known as
Rational Bond. 5 dimensions of this WorkRep are
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
Leadership and Performance, Products and
Responsibility, Work Environment, Professional
Development and Total Rewards. However,
through various studies by Reputation Institute,
workplace reputation is influenced by only 4
dimensions which are Leadership and Performance,
Products and Responsibility, Work Environment
and Professional Development. Employees
satisfaction and perception towards these
dimensions or Rational Bond determine the degrees
of admire, trust, good feeling and trust among the
employees as it influence their emotional feelings
and favourable attitude towards the organisation
(Reputation Institute, 2011).
“Most of today’s employees are well educated, have higher expectations of what they will get out of their careers than their parents did, and want to understand more about the companies they work for” (Argenti, 2009). Employees nowadays have different standards and principles. They are more exposed to various industry related information and demand for transparencies at work. As what happened to Wal-Mart in 2006 when they were accused of unfair treatment of employees such as preferring men over women in terms of salary and advancement, and imposing employees to work off the clock, Wal-Mart has been badly condemned by numerous media. This has caused Wal-Mart a bad reputation and drop in sales. The employees refused to care about the company and do as they were instructed to do because Wal-Mart did not care about them neither according to them (Argenti, 2009).
“Employer branding has become a more popular
topic due to an increase in the power of brand, an
increase in focus on employee engagement, a tight
labor market and “war for talent” (Butler & Tuuk,
2012, p.1). According to studies, a strategic
management of “employee value proposition’ is
useful in benefiting organisations such as increase
of vacancy applicants by 20%, increase of cost
effectiveness of payroll and most importantly
higher commitment among employees. Microsoft
has also taken the same step by encouraging and
helping employees to realize their own potential
and be brave to “take the challenge and see them
through” (Butler & Tuuk, 2012).
“Marketing has been focusing on brand
management for many decades, but companies’
targeted and strategic focus on employer brand
management from an internal perspective is a
relatively new phenomenon” (Butler & Tuuk, 2012,
p.1). Over half of companies were found to focus
and deliberate on internal branding as much as
external branding. It influences how employees
value their employer and employees’ behaviour
towards the brand or employer which can also
influence customer’s perception towards the
organisation. The importance of internal reputation
has been proven by Chief Operating Officer (CEO)
of HCL Technologies in India, Vineet Nayar. He
practices “employee first, customers second”
unconventional idea in HCLT and has made a
tremendous positive changes to the company
(Nayar, 2010). Employers realize how employer
brand is crucially important in determining ups and
downs of an organisation that many leading
organisations have started to implement internal
branding strategy. They recognize the importance
of engaging the employees in increasing their
productivity and gaining profit. Top organisations
like GE, HP, IBM, Microsoft, Nokia-Siemens,
PepsiCo, P&G, RBS, Shell and Unilever have
started to implement “active employer brand
development strategies” towards achieving positive
internal reputation. “They are also beginning to
recognise that creating a positive brand experience
for employees requires the same degree of focus,
care and coherence that has long characterised
effective management of the customer brand
experience” (Mosley, 2009). It is believed that
positive internal reputation is highly associated with
organisation’s positive profit growth as studied by
Sears that “4% increase in employee satisfaction
would translate into more than $200m in additional
revenue”. Another study conducted on Standard
Chartered Bank has resulted with branches with
“highly engaged employees were associated with
greater revenue growth (+ 6%) and greater profit
margin growth (+100%)”. Internal branding helps
to gain employees acceptance and commitment by
giving the same brand experience as expected to be
experienced by the customers to the employees.
“Employees are unlikely to ‘live the brand’ unless
they experience it for themselves, and if employees
fail to deliver on the brand promise, the investment
in marketing the new message is likely to be
counter-productive” (Mosley, 2009, p.11).
Factors predicting internal reputation. Hong and
Yukl (1994) explained that “leadership develops
favorable internal reputation and generate positive
word-of-mouth and supportive behavior” (Men,
2010, p.39). Leaders in an organisation play a big
role in getting employees’ good feeling towards the
organisation. Good leaders can sustain employees’
trust, admiration and loyalty even in economic
downturn. Downling (2004), Fombrun (2000) and
Helm (2005) also agreed with the finding that
‘leadership quality’ is one of the most important
factors in reputation (Men, 2010, p.38). Other
researchers such as Rafferty and Griffith (2004)
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
also indicated about the positive correlation
between transformational leadership and
employee’s satisfaction where they show positive
emotions such as happiness, superiority, esteem and
enthusiasm. When a transformational leader
practices employee empowerment where employees
are given a voice in decision making, employees
will feel appreciated, trusted and valued by leaders
or organisation generally. Combination of these
emotions outlines favourable perception towards
the organisation (Men, 2010, p.37). “New
leadership is another opportune moment for internal
rebranding” as employees are normally open up to
new ideas which has proven to Hewlett Packard and
Sears (Mitchell, 2002, para 7). A lot of colleges are
currently going through bad financial problem
which affects the employees such as late salary,
reduction of salary or lay off from work. However
due to good leadership where empathy, concern on
employees’ welfare and safety is shown,
organisation’s reputation rate does not decrease
much (Fischman, 2010). Clive (2003) also agreed
that apart from other factors contributing to
employees’ satisfaction such as ‘work conditions’,
incentives, other benefits and rewards system,
leadership also plays an important role in shaping
employee’s satisfaction.
Feeling of comfort and security influences
employees’ attitude towards the organisation where
they will feel the positive emotion and give their
loyalty and commitment to the organisation (Clive,
2003). Employees in IKEA are given equal chances
and heard in decision making and this is called
employee empowerment. IBM is famous with its
motto ‘today, collaboration is the name of the
game’ where they encourage every stakeholders
including customers to work together with them in
creating the world of innovations (Pot, 2010).
Fombrun (2000), Laschinger, Finegan & Shamian
(2001) and Kirkman & Rosen (1999) stated
‘employee empowerment leads to employee
satisfaction, commitment, trust, loyalty and quality
organisation’ (as cited in Men, 2010, p.39). If
employee is given higher authority or trust in
decision making by an organisation, organisation
will also be more trusted by the employee in return
(Men, 2010). Research by Laschinger, Finegan and
Shamian in 2001 concluded a ‘significant positive
relationship between employee empowerment and
work attitudes and performance’ as cited in Men,
2010, p.14).
Early research by Herzberg (1966) has found out
that employee development has positive correlation
with their satisfaction towards and organisation.
Their level of motivation will increase if they are
filled with trainings and developments to improve
their skills and knowledge. From here employees
have a chance to get better achievement,
recognition, stimulation, responsibility and
advancement (as cited in Mani, 2010, p.131).
However, employees nowadays do not emphasize
more on their professional development or career
path (Dortok, 2006) contradicting with employees
in education industry (Karak, 2010).
According to Richardson and Bolesh (2002)
maintaining a high quality products or high
standard procedures or services is very important
for an organisation with a good reputation. High
ethical and transparency practice in producing
quality products and services help to keep their
reputation at a good place (as cited in Le Roux,
2003, p.88). A study conducted by Denmark
Reputation Institute on higher education institution
in Denmark concluded that ‘products and ethics’ as
one of the two most important workplace reputation
drivers. Reputable companies conducting business
with integrities are most likely to be the choice of
potential employees among Scandinavians
(Fombrun, 2007)
A study conducted on education institution in
Turkey indicated rewards and remuneration such as
good salary system, unbiased promotion system and
retirement system as the highest priority to the
academic staff. This reputation dimension is also
very important in other parts of Europe and
America as employees normally switch jobs and go
for higher paychecks (Toker, 2011). This study is
consistence with studies conducted by Eskildsen
(2004) and Liou et al (1990) which concluded
physical reward like remuneration, salary or
benefits has positive influence on employee
satisfaction towards an organisation (as cited in
Mani, 2010, p.130). Mani (2010) conducted a study
himself in India and found out that employees in
India see extrinsic reward as one of the important
factor in determining employees’ satisfaction too.
These studies’ result however contradicts with
Zagorsek’s study in 2008. According to him even
though employees’ needs of extrinsic reward are
fulfilled, this economic transaction does not
contribute much in generating favourable emotion
towards an organisation nor guarantee employees’
commitment. Other reputation drivers are likely to
be more important than compensation (as cited in
Men, 2010, p.38). Employees are willing to accept
lower compensation from an organisation or brand
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
that they trust or respect. The most important thing
is delivering promises through products or services
with integrity and highly ethical as trusted by users
or stakeholders (Strategic Direction, 2008).
II METHODOLOGY
Survey instrument has been drafted based on
WorkRep and Reptrak model. Some of the
questions have been adapted from studies
conducted by Reputation Institute. In order to
evaluate the reliability of survey instrument, pilot
test has been conducted on 30 respondents which
has resulted with Cronbach alpha value of 0.965.
Questionnaires have been distributed to 221 out of
251 employees of ABC College who were not
involved in the p test however only 118 completed
questionnaires were returned back. Questionnaire
was drafted into 4 sections as explained in Table I
according to the theoretical model ; WorkRep
model where all objectives are measured using
Likert Scale and analysed using Descriptive
Analysis and Multiple Regression.
Table 1: Distribution of research items in
questionnaire
Section Description
Section A Demographic Data
Section B Emotional Bond
Section C Reputation Dimension – Leadership &
Performance
Reputation Dimension – Work
Environment
Reputation Dimension – Professional
Development
Reputation Dimension – Products &
Responsibility
Reputation Dimension – Total Rewards
Section D Supportive Behaviour
III FINDINGS
Survey instrument has been drafted based on
WorkRep and Reptrak model. Some of the
questions have been adapted from studies
conducted by Reputation Institute. In order to
evaluate the reliability of survey instrument, pilot
test has been conducted on 30 respondents which
has resulted with Cronbach alpha value of 0.965.
Questionnaires have been distributed to 221 out of
251 employees of ABC College who were not
involved in the p test however only 118 completed
questionnaires were returned back. Questionnaire
was drafted into 4 sections as explained in Table I
according to the theoretical model ; WorkRep
model where all objectives are measured using
Likert Scale and analysed using Descriptive
Analysis and Multiple Regression.
A. Employee’s Perception on ABC College’s
Internal Reputation
A decoder interpreting result obtained from survey
conducted is shown in Table 2 where 1 point is
decoded as ‘Poor’, 2 points is decoded as ‘Weak’ or
‘Vulnerable’, 3 points is decoded as ‘Average’ or
‘Moderate’, 4 points is decoded as ‘Strong’ or
‘Robust’ and 5 points is decoded as ‘Excellent’ or
‘Top Tier’.
Table 2: Distribution of decodes of each point for
reputation rate
Point(S)
Decode
1 Poor
2 Weak or Vulnerable
3 Average or Moderate
4 Strong or Robust
5 Excellent or Top Tier
According to Table 3, overall rating for ABC
College corporate reputation is rated 3.297 out of 5
points by the employees which falls under
‘Average’ or ‘Moderate’ as interpreted in Table 2.
Item ‘ABC College has a good reputation’ rated
highest (µ = 3.500, SD = 1.210) whilst item ‘I trust
ABC College’ rated lowest (µ = 3.085, SD = 1.144)
in the survey conducted.
Table 3: Mean and Standard Deviation for Emotional
Bond (n=118)
Emotional Bond Mean SD
ABC College has a good
reputation
I have a good feeling about ABC
College
I admire and respect ABC College
I trust ABC College
3.500
3.314
3.288
3.085
1.210
1.068
1.125
1.144
Average 3.297 1.137
Anova test was carried out to determine the
difference among branches towards ABC College’s
internal reputation. As shown in Table 4, the
outcome revealed that there was mean differences
between groups and within groups of branches
towards ABC College’s internal reputation.
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
Table 4: ANOVA Test of ABC College’s internal
reputation on different branch (n=118) Source Lev
el
Of
Free
dom
Sum Of
Squares
Mean
Squares
F Value Sig
Value
(p)
Intra
group
Inter
group
1
116
12.687
50.330
12.687
0.434
29.240
0.000**
Total 117 63.017
**p=0.000, p<0.05
The F value was 29.240 while the significant value
was (p=0.000 which is below the significant level
(ɑ=0.05). Therefore there is a significant difference
of ABC College’s internal reputation between
Selangor and Melaka branch.
ABC College has two branches; Selangor and
Melaka where respondents in both campuses rate
their employer differently. According to Table 5
respondents in Selangor rate ABC College at 2.983
which is under the ‘Weak’ or ‘Vulnerable’ category
as followed in Table 2 and respondents in Melaka
rate ABC College at 4.217 which is decoded under
the ‘Strong’ or ‘Robust’ category.
Table 5: Independent T Test of ABC College’s
internal reputation rate on different campuses
(n=118)
Office Location N Average
Mean
T
Value
Sig Value
(p)
Selangor
Melaka
88
30
2.983
4.217
-
8.644
0.000
Table 6 represents means for each attributes of
emotional bond that measures the internal
reputation of both campuses of ABC College;
Selangor and Melaka. Highest contribution to the
means is item “ABC College has a good reputation”
with mean of 3.205 for SEL and 4.367 for MK.
This item is rated as slightly higher than ‘Not Sure’
for Selangor and slightly higher than ‘Agree’ level
for MK. Item ‘I trust ABC College’ did not get
good response from respondents in Selangor as it is
rated as somewhere between ‘Disagree’ and ‘Not
Sure’ level with mean of 2.693. However this item
received good response from respondents in MK
rated mean 4.233.
Table 6: Mean and Standard Deviation of Emotional
Bond on different branch (n SEL = 88, n MK = 30)
Emotional Bond Mean SD
*SEL **MK *SEL **MK
ABC College has a
good reputation
I have a good
feeling about ABC
College
I admire and respect
ABC College
I trust ABC College
3.205
3.068
2.966
2.693
4.367
4.033
4.233
4.233
1.224
1.070
1.066
1.010
0.615
0.669
0.678
0.626
Average 2.983 4.217 1.093 0.647
*SEL = Selangor
**MK = Melaka
B. Contributing Factors Indicating Employee’s
Perception Towards Organisation’s Internal
Reputation
R value 0.831 indicates a strong correlation
between the independent variables (Rational Bond)
and dependent variables (Emotional Bond). ABC
College’s Emotional Bond can be largely explained
by 69% of the Rational Bond’s variables
(R²=0.690) and WorkRep model applied for this
research is significantly good in predicting
employee’s Emotional Bond towards ABC College
(Sig F=0.000, p<0.05)
Correlation and multiple regression analyses have
been conducted to study the relationship between
Emotional Bond and various predictors under
Rational Bond. Table 7 summarizes the descriptive
statistics and analysis results. Table7 shows that
each of the Rational Bond variable’s score is
positively and significantly correlated with the
criterion, signifying that higher scores on these
variables tend to contribute to higher score of
Emotional Bond. The multiple regression model
with all five predictors produced R² = 0.690, F =
49.81, p < .005. As can be seen in Table 7, variable
‘Leadership and Performance’, ‘Work
Environment’, ‘Professional Development’,
Products and Responsibility’ and ‘Total Rewards’
had significant positive regression weights,
indicating higher scores on these variables were
expected to cause a higher Emotional Bond score.
Each point increase on ‘Leadership and
Performance’ variable will increase Emotional
Bond’s score by 0.395, ‘Work environment’ will
increase Emotional Bond by 0.218, ‘Products and
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
Responsibility’ will increase Emotional Bond by
0.283 and ‘Total Rewards’ will increase Emotional
Bond by 0.222. Whilst, each point increase of
‘Professional Development’ will predict lower
Emotional Bond’s score by 0.242.
Table 7: Predictors of the Emotional Bond using
Standard Multiple Linear Regression (enterwise
method)
Variables B Beta R p T
Intercept
Leadership and
Performance
Work
Environment
Professional
Development
Products and
Responsibility
Total Rewards
3.281
0.263
0.128
-0.282
0.232
0.232
-
0.395
0.218
-0.242
0.283
0.222
0.767
0.739
0.618
0.763
0.718
0.000
0.000
0.026
0.015
0.012
0.019
3.816
3.750
2.261
-2.473
2.547
2.378
F =49.810 r =0.831
Sig-F =0.000 R2= 0.690 Adj. R2 = 0.676
Melaka. From Table 8, WorkRep model used is
significant to predict Emotional Bond of ABC
College (Sig F=0.000, p<0.05).
Table 8: Predictors of the Emotional Bond in Melaka
branch using Standard Multiple Linear Regression
(enterwise method)
Variables B Beta r P T
Intercept
Leadership and
Performance
Work
Environment
Professional
Development
Products and
Responsibility
Total Rewards
2.734
0.450
-0.127
-0.038
0.275
0.122
-
0.733
-0.236
-0.030
0.310
0.137
0.873
0.703
0.573
0.736
0.764
0.218
0.001
0.313
0.834
0.123
0.446
1.264
3.717
-1.031
-0.211
1.587
0.776
F =18.124 r =0.889
Sig-F =0.000 R2 =0.791 Adj. R2 = 0.747
R value 0.889 indicates a very strong correlation
between independent variables (Rational Bond) and
dependent variables (Emotional Bond). Table 8
explained a large role of independent variables to
79.1% of Emotional Bond with R² =f 0.791. As the
regression analysis was carried out using the
enterwise method, none of the variables to
‘Emotional Bond’ was dropped. The largest beta
coefficient is 0.733 which is for ‘Leadership and
Performance’ indicating any standard deviation
increase of ‘Leadership and Performance’ will
predict a higher Emotional Bond’s standard
deviation by 0.733. This means that this variable
makes the strongest unique contribution in one’s
‘Emotional Bond’, when the variance explains by
all other predictor variables in the model are
controlled. The Beta value for ‘Products and
Responsibility’ is the second highest (0.310),
followed by ‘Work Environment’ with 0.236 in the
third place, ‘Total Rewards’ (0.137) in the fourth
place and lastly, ‘Professional Development’ with
0.030. Both ‘Work Environment’ and ‘Professional
Development’ indicate a lower standard deviation
of Emotional Bond by 0.236 and 0.030 with their
increase of standard deviation.
Selangor. Based on analyses from Table 9,
WorkRep model used is significant to predict
Emotional Bond of ABC College for Selangor
branch (Sig F=0.000, p<0.05). R value 0.741
indicates a strong correlation between independent
variables (Rational Bond) and dependent variables
(Emotional Bond). Table 8 explained a big role of
independent variables to 54.9% of Emotional Bond
with R² of 0.549.
Table 9: Predictors of the Emotional Bond in
Selangor branch using Standard Multiple Linear
Regression (enterwise method)
VARIABLES B Beta r P T
Intercept
Leadership and
Performance
Work
Environment
Professional
Development
Products and
Responsibility
Total Rewards
2.745
0.273
0.144
-0.301
0.243
0.255
-
0.332
0.234
-0.236
0.267
0.226
0.616
0.614
0.407
0.634
0.564
0.026
0.003
0.032
0.032
0.027
0.035
2.273
3.057
2.179
-2.183
2.246
2.147
F =19.926 r =0.741
Sig-F =0.000 R2 =0.549 Adj. R2 = 0.521
As the regression analysis was carried out using the
enterwise method, none of the variables to
‘Emotional Bond’ was dropped. Four predictors
indicate significant positive regression weight
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
signifying higher standard deviation of these
predictors will increase standard deviation score of
Emotional Bond including ‘Leadership and
Performance’, ‘Products and Responsibility’,
‘Work Environment’ and ‘Total Rewards’ whilst
‘Professional Development’ indicates significant
negative regression weight to Emotional Bond’s
score. The largest beta coefficient is 0.332 which is
for ‘Leadership and Performance’ indicating any
standard deviation increase of ‘Leadership and
Performance’ will predict a higher Emotional
Bond’s standard deviation by 0.332. This means
that this variable makes the strongest unique
contribution for ‘Emotional Bond’, when all other
predictor variables in the model are controlled. The
Beta value for ‘Products and Responsibility’ is the
second highest (0.267), followed by ‘Professional
Development’ with 0.236 in the third place, ‘Work
Environment’ (0.234) in the fourth place and lastly,
‘Total Rewards’ with 0.226. ‘Professional
Development’ indicate a lower standard deviation
of Emotional Bond by 0.236 with its’ increase of
standard deviation.
IV DISCUSSION
On overall, ABC College’s internal reputation is
rated 3.297 by the employees and it falls under
Average or Intermediate category. Looking at the
rate, there are still a lot of rooms for improvement
as employees play a big role especially in service
industry and in highly competitive industry like
education. The rapid growth of education industry
gives customers like students or parents a wide
range of choices to choose from. The trust gained
from employees is very important as employees are
the organisation’s front liners who deal with
customers every day. If there is no trust in the
organization, there is a possibility they may open
up and voice out their dissatisfaction to anybody
and overheard by anybody especially customers.
Thus will jeopardies organisation’s reputation and
damage reputation badly. Reputation and
satisfaction are aligned and related to each other
(Dortok, 2006).
Employees from both branches in Melaka and
Selangor perceive their employer differently, same
as Standard Chartered Bank’s employees (Mosley,
2009). Melaka branch has a good reputation unlike
Selangor branch that has a bad reputation which
clearly shows that its employees have negative
emotions towards ABC College. This difference
may be caused by many factors such as different
leadership which may practice different ideas in
these two branches or ‘leadership quality’ which is
one of the most important factors in reputation
(Men, 2010). Leaders’ decision on employee
empowerment, decision ship, transparency and
others can influence employee’s perception towards
its employer (Nayar, 2010). Difference of
perception may be also explained by “nested set of
subculture” which exist in different branch as
studied by Rosen (1985) on advertising agency
(Wilson, 1997, p. 167) and has caused employees to
perceive and understand their employer differently.
It is agreed by Moller (2009) in his study on
internal branding of organisations in UK and
Denmark that culture plays a role in determining
employees’ emotion towards an organisation.
This study indicates that the most important factor
predicting ABC College’s internal reputation is
leadership. WorkRep model used for this study
resulted in high contribution of 69% to internal
reputation measurement. As shown in Table 10, in
general ‘Leadership and Performance’ factor
contributes 39.5% to ABC College’s internal
reputation. While ‘Professional Development’
contributes negatively to ABC College’s internal
reputation which contradicts with Karak’s research
in 2010 where he concluded high level of
satisfaction towards professional development
provided by employer will also increase favourable
level towards the organisation.
Table 10: Distribution of the contribution of each
reputation dimension to internal reputation
Reputation Dimension Contribution (%)
Leadership and Performance
Work Environment
Professional Development
Products and Responsibility
Total Rewards
39.5
21.8
-24.2
28.3
22.2
However, branches in Melaka and Selangor are
perceived differently by ABC College’s employees
which can be clearly explained in Table 11 and
Table 12. In Melaka branch, ‘Leadership and
Performance’ contributes majorly in predicting its
internal reputation. Leadership and company’s
performance is seen as the biggest factor in
determining employees’ favorable attitude and
emotion towards ABC College and its internal
reputation generally. Selangor branch’s employees
has the same attitude towards its ‘Leadership and
Performance’ but this factor does not contribute as
high it is in Melaka.
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
Table 11: Distribution of the contribution of each
reputation dimension to internal reputation (Melaka)
Reputation Dimension Contribution (%)
Leadership and Performance
Work Environment
Professional Development
Products and Responsibility
Total Rewards
73.3
-23.6
-3.0
31.0
13.7
Table 12: Distribution of the contribution of each
reputation dimension to internal reputation
(Selangor)
Reputation Dimension Contribution (%)
Leadership and Performance
Work Environment
Professional Development
Products and Responsibility
Total Rewards
33.2
23.4
-23.6
26.7
22.6
In both branches ‘Professional Development’ is not
seen as positive factor in predicting internal
reputation. Least positive predicting factor towards
positive internal reputation is ‘Total Rewards’ and
this result is similar with Zagorsek’s study in 2008
which concluded human’s fundamental needs are
important to employees but does not much
influence employees’ favourable emotion towards
the organisation. Remuneration system,
compensation or rewards make employees happy
but this item is not the influencing factor of their
trust and motivation to work. Even though
employees do not get high salary or bonuses, they
do not use it as the main reason to switch job (Men,
2010, p.38).
‘Products and Responsibility’ is the second highest
contributing predictor to internal reputation of ABC
College in both Melaka and Selangor branches.
Apparently, a study by Reputation Institute on
workplace reputation in Denmark came up with the
same result where products and ethics has been
rated among top two important factors of
favourable decision towards an organisation.
Employees are committed to work for organisation
that upholds and maintain high quality products or
services and practice high ethical standard in
running their business (Fombrun, 2007).
Both employees in Melaka and Selangor branches
have different stand on ‘Work Environment’ factor.
For employees in Melaka, ‘Work Environment’
factor is seen as negative predictor to internal
reputation unlike in Selangor branch. This is similar
as tudy in Turkey where the finding showed that
higher education employees in Turkey rate physical
facilities or environment as the least important
factor in determining their emotion towards an
organisation (Toker, 2011). Compared to study by
Eskildsen (2004) and Martensen & Gronholdt
(2001), social atmosphere at workplace is regarded
as one principal factor contributing to employee’s
motivation and favourable emotion towards an
organization (as cited in Mani, 2010, p.130) which
is consistent with acceptance of ‘Workplace
Environment’ in Selangor branch.
Employees at the branch which has a good
leadership do not seem to take other unimportant
factors such as ‘Work Environment’ and
‘Professional Development’ into account as they
are content enough working under a good
leadership that they rate internal reputation highly.
V CONCLUSION
This study focused on the difference of employees’
perception on internal reputation in different
branch. Employees in different branches have
different emotions towards their employer and this
may resulted from different set of nested
subcultures in different branches as explained by
Wilson (1997). Despite of the differences,
leadership and organisation’s performance are still
seen as the biggest factor in gaining employees’
trust and predicting one’s internal reputation. Good
leadership is able to outshine other dimensions in
predicting internal reputation as seen on Melaka
branch’s result. Without a good leadership or
company’s good performance, other factors are
perceived as important as leadership and
performance factor. As Butler and Tuuk (2012)
explained “different employee groups are going to
have vastly different desires” (p.2). It is also
important to keep in mind that employment
branding inherently suggests differentiation of a
firm’s characteristics as an employer from those of
its competitors. Additionally, focusing on what is
unique to their specific company and highlighting
“signature experiences will help companies create a
successful employer brand” (Butler & Tuuk, 2012,
p.2) Organisations need to focus on engaging its
employees and study their different needs, desires
and subcultures in managing the internal reputation.
Practical implication. Good ‘leadership and
performance’ contributes the most to an
organisation’s internal reputation as it is able to
outshine other dimensions. Most employees show
their big support to organisations that have good
‘leadership and performance’ and they are willing
to accept weaknesses of other dimensions. ‘Total
reward’ and ‘work environment’ factors are almost
ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012
as equally important as other dimensions to a
moderate internal reputation organisation with a
weak measurement of ‘leadership and
performance’. Leaders play important role in
decision making which require practicing empathy
and having a better communication with employees
in building a good internal reputation.
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