The brand management system (BMS) : its facilitators, impediments, and consequences

Abstract

Several empirical findings have emphasized the strategic benefits for organizations that possess strong brands. Frequently mentioned advantages are the positive influence that brands have on evaluations of customers, and investors. Acknowledging the importance of brands and that these intangible resources of a firm are contingent upon adequate recognition and support (M’zungu, Merrilees, and Miller 2010) - recent studies have investigated how the brand management system (BMS), i.e., a “basic internal management infrastructure” (Santos-Vijande, Belén, Suárez-Álvarez, and Díaz-Martín 2013, 148) enhances customer performance, which in turn positively impacts business performance (Santos- Vijande et al. 2013; Lee, Park, Baek, and Lee 2008). Though research has investigated how brands should be managed internally to increase their value, none has examined how antecedents in the external and internal environment of an organization can destruct or facilitate the development of the BMS. This is what the current study contributes to. We believe that more knowledge, and understanding of the possible impediments and facilitators of the BMS can help companies in the process of its development, and ultimately improve their performance. By the use of path analysis, with 101 decision-makers from the Norwegian food processing industry as participants, this study particularly addresses that significant facilitators of the BMS are: formalization, market orientation, reputational assets, and short-term orientation, whereas a significant impediment is specialization. Additionally, this study addresses that the key variables of market orientation, and short-term orientation have a significant and positive impact on a firm’s customer performance, whereas innovativeness, and specialization exert a negative impact on this performance variable. Lastly, this study confirms the important, and positive relationship between the BMS, and customer performance – and where customer performance in turn has a direct influence on business performance.