A Case Study Of Standard Chartered Bank
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This chapter provides an introduction of the study with the main areas presented including the importance of communication in an organisation, branding, intranet, the problem statement, purpose, research questions, limitations and assumptions that will govern the study.
Background of the Study
Communication is an organisational asset which has a big impact on the success of the business. Communication serves a number of important functions in an organisation such as sharing and clarifying goals, identifying how goals are to be achieved, exerting control, motivating others, developing a sense of community and commitment, sharing information and creating common understanding. It is estimated that employees spend about four fifth of their working life communicating (Ferreira, 2006). Communication in the organisation is central to the success of the business and must be taken into consideration in a quest to increase organisational competitive advantage.
According to a study conducted in the U.S. by Watson Wyatt, a human resources consulting firm, companies that communicate more effectively with their employees have a lower turnover rate (on average 33.3 percent) than those that communicate less effectively (average 51.6 percent) (Ewing, 2007). Du Plessis and Boshoff (2008, p.3) defined internal communication as "the communication between people working together to achieve individual or collective organisational goals". Internal communication, also referred to as 'organisational communication', is the process of communication between the people within the organisation (Scheffer & Crystal, 2008). Internal communication process is used to maintain good relationships, describe tasks, give instructions and communicate the goals and philosophy of the organisation (Ferreira, 2006). Effective internal communication is a major contributor to the success of change initiatives in organisations. In particular, at the individual level, appropriate internal communication helps employees to understand both the need for change, and the personal effects of the proposed change (Goodman & Truss, 2004).
The study of internal communication is arguably one of the fastest growing areas within the field of communication, with a 25-30 percent growth rate in the past five years. In fact, studies indicate that organisations are pointing to effective internal communication as an influential factor in business success (Cees, Berens, & Dijkastra, 2005; Holtz, 2006). Internal communication is defined as the "formal and informal communication taking place internally at all levels of an organisation" (Kalla, 2005, p.304). Research on internal communication is cross disciplinary, and the number of available definitions reflects this fact. Internal communication can be termed as internal marketing, organisational communication, employee relations (Quirke, 2000), management communication, internal media, cross-departmental communication (Greenbaum, Clampitt, & Willihnganz, 1988), business or corporate communication (Kitchen, 1997), strategic communication (Argenti, 2007) or integrated internal communications (Kalla, 2005). Welch and Jackson (2007) view internal communication from a stakeholder approach and define it as "the strategic management of interactions and relationships between stakeholders at all levels within organisations" (p. 183).
Literature spanning the last 10 years suggests that good internal communication management is one of the pivotal steps towards successful and productive communication within an organisation (Holtz, 2006; Karian & Box, 2006; Cees et al., 2005; Quirke, 2000a; Tourish & Hargie, 2000a). Welch and Jackson (2007) state that; "internal communication management includes participation in communication, its direction and the content of communication" (p.184). However, participation and direction of communication is strongly influenced by the hierarchical structure of the organisation where "issues of status, power, rank and prerequisites often cloud the form and content of upward communication" (Silburyte, 2004, p.192).
Today, organisations are adopting flatter more dynamic structures which have more inclusive participation from all levels of the organisation (Silburyte, 2004) as well as varied content including new developments, organisational achievements, appraisal discussions and employee roles, noted previously in Welch and Jackson's four dimensions of internal communication (see Table 2.1). Similarly, Quirke (2000a) also suggests that internal communication can be shared across different organisational departments and likens it to a jigsaw where each section is responsible for a piece of the internal communication puzzle (i.e. the core departments within an organization). This metaphor suggests that internal communication is more than the realm of corporate communication and is involved in all areas of the organisation.
In the modern global competitive environment, corporate branding has become an important source of sustainable competitive advantage and a central element of corporate strategy (Balmer & Gray, 2003). It includes core values cherished by a company, its corporate culture, identity, business model, people and it can be described as -the visual, verbal and behavioral expression of corporate identity and business model (CicvariÄ‡, 2006). The corporate branding strategy determines the manner in which a company will fulfill its mission and vision, and realize value for its stakeholders (Jarventie-Thesleff et al, 2011). It is most often expressed through the so-called 'brand promise' which the company has to 'live' and maintain in everyday business, to all stakeholders (Aaker, 2004).
In delivering the value and brand promise, as well as in the application of each branding strategy, a strategic part is played by the company's employees (from top management to those on lower-level positions, who co-operate daily with different stakeholders. The employees' role becomes clear when considered in conjunction with the corporate branding strategy framework, which is not only the products and services it sells, but it also represents what the company does and actually is, (i.e. a functionally and emotionally rounded unity).
Due to intensive technological changes, the life cycle of products and services has a declining tendency, so corporate branding becomes the cornerstone for building and maintaining relations with stakeholders. One the other hand, the corporate reputation definition; describing reputation-as a set of relatively long-term impressions, attitudes and emotions of individuals or groups in respect of an organization, established through experience or partially credible indirect information, in the context of personal and social expectations, which impacts intentions or behavior of individuals or groups in connection with that specific organization (Vlastelica BakiÄ‡, 2012), helps to grasp the significance of employees in the establishment of beliefs and attitudes of the company's other stakeholders. The value of corporate branding and reputation yields benefits for the company which increases its financial performances and market value on the long run. This represents valuable resources which competitors cannot copy or imitate. Aside from reputation, being the organization's intangible capital, another precious resource that is unique and attributable to one company only involves its employees, their knowledge, abilities and skills.
Kotler Wong, Saunders and Armstrong (2005) define a brand as "a name, term, sign, symbol, or design, or a combination of these, that identifies the maker or seller of a product or service and seeks to differentiate them from those of competitors". The brand is more or less the essence of an organization that informs the customers' choice to interact with one brand over another. It is therefore clear that by focusing more efforts on branding, organisations can attempt to differentiate themselves more in the minds of customers and potential customers by increasing the value propositions associated with their brands and create a strong brand image and presence in the market thus giving them a stronger competitive advantage.
Fernandez' (2004) defines a corporate brand as the institution's image, reputation, financial assets, performance and people. Thus, the corporate brand of an organisation tells us what to expect from the organisation as a whole - the set of values, promises, standards and characteristics of an organisation as embodied in the brand. It is thus the totality of the organisation and what it represents and what it hopes to achieve through provision of goods and services in the ordinary course of business. A brand can thus be said to constitute the collection of associations in the mind of a customer connected to the brand e.g. quality, friendliness, added value, superior service among others and such are what can greatly differentiate between similar products and services. The value of these associations, their uniqueness and relevance are an indication of the power of the brand. The underlying brand promise is what many organizations are looking to further underscore and highlight in their increased branding efforts to retain existing customers and attract more customers.
One key element of effective employer branding is internal branding. Internal branding is only effective when internal audiences are reached with the message of the organization's values, through effective communicational efforts and when top management also exemplifies the same. Employees cannot be expected to show what they do not know. The service sector particularly has woken up to the fundamental importance of engaging employee commitment in delivering customer satisfaction and loyalty. The service sector does not provide tangible products/output that customers can take away with them and experience on their own; their experience with an organization's brand is through interacting with the organization's staff. There has been a shift in the branding world as explained by Vargo and Lusch (2004) to a new orientation known as service branding which is more balanced in its outlook. It considers both brand identity (internal) and brand image (external); highlighting the importance of staff in the service encounter.
The banking sector is one area where service branding is very vital. Customers' experience of the brand begins the moment they walk through the doors of the banking hall and in their dealing and experience with the bank's employees. Thus, the way they are treated while in the banking halls, response to their queries, promises made and fulfillment of the same all contribute to their perception of the brand and indeed affect their loyalty to the brand. Hence, there is a need to have employees that fully understand the brand in order to deliver more superior and unique brand experience to the customers in line with the organization's mission and vision.
Overview of the Banking Industry in Kenya
The banking industry in Kenya is governed by the Companies Act, the Banking Act, the Central Bank of Kenya Act and the various prudential guidelines issued by the Central Bank of Kenya (CBK). The banking sector was liberalized in 1995 and exchange controls lifted. The CBK, which falls under the Minister for Finance, is responsible for formulating and implementing monetary policy and fostering the liquidity, solvency and proper functioning of the financial system. As at December, 2012 there were forty six banking and non-banking institutions, fifteen micro finance institutions and one hundred and nine foreign exchange bureaus. The banks have come together under the Kenya Bankers Association (KBA), which serves as a lobby for the banking sector's interests (CBK, 2013).
The KBA serves as a forum to address issues affecting members (KBA, 2012). Over the period between years 2006 to 2012, the banking sector in Kenya continued to grow in assets, deposits, profitability and products offering. The growth was mainly underpinned by; first; an industry wide branch network expansion strategy both in Kenya and in the East African community region. Second; automation of a large number of services and a move towards emphasis on the complex customer needs rather than traditional "off-the shelf' banking products (KBA, 2012). Players in this sector experienced increased competition over the period between years 2006 to 2012 resulting from increased innovations among the players and new entrants into the market. Key players in the early stages of the operation of the Industry were; Kenya Commercial Bank(k) Ltd. (KCB), Barclays Bank of (K) Ltd., (BBK), Standard Chartered Bank (K) Ltd.(SCB), National Industrial Credit Bank (NIC), National Bank of Kenya (K) Ltd. (NBK) and Co-operative Bank of Kenya (Co-op bank) ( KBA, 2012).
Background on Standard Chartered Bank Ltd
Standard Chartered Bank Kenya Limited was established in 1911 with the first branch opened in Mombasa Treasury Square. More than 100 years later, Standard Chartered Bank is one of the leading Banks in Kenya, with an excellent franchise. It has a total of 33 branches spread across the country, 90 automated teller machines (ATMs) and 1,698 employees. Standard Chartered Bank Kenya Limited has local shareholding of about 26%, comprising about 32,000 shareholders and it is a public quoted company on the Nairobi Securities Exchange since 1989. The bank offers a variety of local and foreign currency accounts, both deposit and loan, to its customers. It has a diversified portfolio cutting across select sectors that include business services, manufacturing, wholesale and retail trade, transport and communication, real estate, agriculture, energy and water. Further underpinning its importance, Standard Chartered Bank Kenya Limited hosts the regional Shared Service Centre supporting the bank's technology operations in Uganda, Tanzania, Zambia and Botswana and South Africa on a real time basis (Accessed from www. standardchartered.com/en/about-us).
Statement of the Problem
Despite its importance, few organisations devote enough time and resources to ensure that effective communication systems and processes are in place (Ferreira, 2006). Sanchez (1999) reported in the study conducted by Watson Wyatt Worldwide in cooperation with IABC Research Foundation that only 40 percent of 913 organisations which participated in the study, mainly from the manufacturing industry had formal communication strategies. Knowledge is important, not only between organisations, but also within the organisation. About 90 percent of the knowledge in any organization is embedded and synthesized in peoples' heads (Smith, 2001). The transfer of knowledge is thus important in ensuring that organisational members learn from one another and also create new knowledge. Communication performance within organisations has been considered an understudied area and therefore poorly understood (Pandey & Garnett, 2006) yet it is deemed a "central component of effective business operations" (Hargie, Dickson, & Tourish, 2004, p.5).
Hargie et al., (2004) state that a lack of effective communication can contribute to a range of problems including "at one end of the continuum, job dissatisfaction and stress, through to damaging strikes, operating losses, bankruptcies, production line injuries, shipwrecks, plane crashes and, at the other extreme, mass slaughter in the field of battle" (p.5). Asif and Sargeant (2000) undertook a study of two major United Kingdom clearing banks to explore a range of internal communication issues. Literature specifically referring to the banking industry and internal communication is scarce; however, studies have been undertaken within the last few years that suggest there is growing recognition of the importance of internal communication within this sector (Moorcroft, 2006; Wadman, 2006; Sablosky, 2005; Lennon, 2003; Asif & Sargeant, 2000).
According to Bierly, Kessler & Christensen (2000, p.596) "success does not necessarily go to the firms that know the most, but to the firms that can make the best use of what they know". Hence, for knowledge to give competitive advantage, it must be effectively transferred within the organisation (Murray & Peyrefitte, 2007; Watson & Hewett, 2006). Communication plays a vital role in the knowledge transfer process within the organisation (Du Plessis & Boshoff, 2008). One way of managing the knowledge-transfer process is to select appropriate communication media for the property or type of knowledge to be transferred (Murray & Peyrefitte, 2007). Information about the employee's preferred communication methods and technologies is important in ensuring positive and effective communication (Du Plessis & Boshoff, 2008; Ferreira, 2006).
Research suggests that intranets should be considered a mosaic of top-down and bottom-up communication with distributed ownership (Dasgupta, 2001). A study carried out by Papasolomou and Vrontis (2006a) on the UK retail bank industry concluded that the problems linked to the branding of intangible offerings can be overcome through an emphasis on the effective implementation of Internal Marketing (IM). The study found out that since employees play a valuable role in the delivery and strengthening of corporate service brands UK retail banks have placed greater emphasis on IM in order to deliver the brand's promise.
A blanket approach throughout the organisation, regarding regulations on intranet usage, may not be appropriate as different business units will have different requirements. Rather a collaborative and facilitative managerial style would acknowledge diversity and individual contributions (Dasgupta, 2001), thereby allowing individual units and teams to control their own information. Studies show that the versatility and multifaceted nature of intranets has seen an increase in research that is largely multidisciplinary (Lehmuskallio, 2006); however, research into the measurement of intranet effectiveness and perceptions of the employees towards the medium is still in its infancy and is seen as a fundamental shortcoming (Jacoby & Luqi, 2007). This study will therefore focus on establishing the effectiveness of intranets to communicate brand message to its internal publics within SCB limited.
Purpose of the Study
The purpose of this study therefore is to establish the effectiveness of intranets to communicate the brand message to its internal publics within SCB limited in an effort to find out if banks are taking the time, effort and resources to sell the brand to their internal audiences and what strategies have been employed to achieve this.
Objectives of the Study
This study will be guided by the following objectives:
To establish whether SCB Kenya limited has adopted internal communication strategies within its organization to communicate the brand message.
To find out the effectiveness of intranets in communicating the brand message among internal publics within SCB Kenya limited.
To find out how employees in SCB Kenya limited integrate the organization's brand values through internal communication.
This study will undertake to answer the following questions
How has SCB Kenya limited adopted internal communication strategies within its organization to communicate the brand message?
What is the effectiveness of intranets in communicating the brand message among internal publics within SCB Kenya limited?
How do employees in SCB Kenya limited integrate the organization's brand values through internal communication?
Justification of the Study
Despite its importance to corporate communications, rigorous corporate communication research about the use intranets in developing nations is limited. Effective internal communication methods and media for knowledge transfer in the service industry are important for organizations to excel. Internal communication processes are therefore used to maintain good relationships, describe tasks, give instructions and communicate the goals and philosophy of the organisation. Effective internal communication is a major contributor to the success of change initiatives in organisations. In particular, at the individual level, appropriate internal communication helps employees to understand both the need for change, and the personal effects of the proposed change. This study will act as a benchmark to influence banks to adopt excellent internal communication strategies in order to better position their employees to deliver a more superior brand experience to the customers of the bank.
Significance of the Study
This study will add more knowledge in terms of academic contribution and knowledge which is limited in the area of internal communication within the Kenyan banking sector.
This study will act as a platform through which the policy-makers within the banking sector can formulate policies to better enhance effective internal communication.
The study will be able to provide recommendations and guidance on the effective internal communication strategies that can be put in place within the banking sector.
Scope of the Study
This study will be an overview of the internal banking environment in the Kenyan banking sector and will seek to undertake a case study of SCB Kenya limited. The subjects of the study will be the Public relations (PR)/marketing managers/Branch managers of the 20 branches in Nairobi and the customer service managers.
Assumptions of the Study
The assumptions that underlie this study are that:
The selected institution for the study will have some form of internal communication strategy in place used to inculcate brand knowledge among their employees.
The data required for this study will be available and that the researcher will receive maximum cooperation from the expected respondents to allow for a smooth, successful and timely completion of the study.
Limitations of the Study
Unexpected negative response from respondents due to the fact that they might be unwilling to give out sensitive personal information. This will be mitigated through counter-checking on organizational information manuals as well as service charters.
Lack of local scholarly literature on the topic as relates to banks and internal branding means that the some of the methods, concepts and models used in this study are foreign and will be adopted to suit the local experience.
Definition of Terms
Stern (2006, p.217) argues that the word brand can be classified as both an entity and a process, depending on whether it is used as a noun or as a verb. When expressed as a noun, it is connected to a person, place, or thing; as a verb, it refers to the process of making a product meaningful (i.e., the naming or positioning of a product). Dual-function brand concepts such as brand identity and brand reputation (both used as nouns) show the flexibility of this concept. The words branding and branded, on the other hand, are used as verbs to indicate how a brand's meaning changes over time. Stern further comments that in the physical world, a brand is a name or mark associated to a product while it in the minds of people refers to a mental representation or perception of a psychological meaning. This study will adopt this definition in consideration to the fact that this holistic definition reflects the fact that the brand is expressed in numerous ways, not only through marketing.
Burmann and Zeplin (2005, p.284) define employee brand commitment as "the extent of psychological attachment of employees to the brand, which influences their willingness to exert extra effort towards reaching the brand goals." It is the degree to which employees identify and are involved with their service brand, are willing to exert additional efforts (extra touch) to achieve the goals of the brand and are interested in remaining with the organisation.
Steyn and Puth (2000, p.5) define corporate communication as managed communication on behalf of the organisation, aiming to increase organisational effectiveness by creating and maintaining relationships with stakeholders.
According Drake, Gulman, and Roberts (2005) and Thomson, de Chernatony, Arganbright and Khan (1999), internal branding is the practice of selling and promoting the brand to the internal audiences of an organisation, i.e. its employees in order to be instrumental in influencing employees' attitudes and shaping their behaviours to be aligned with a brand, by creating employees' understanding of brand values and engaging them in living brand-reality.
This is the concept of customer-service provider relationships inside the organisation; employees providing a service to other employees or departments in the organisation as opposed to providing a service to clients external to the organisation. Services should be provided to fellow employees and departments with the same commitment to customer satisfaction as for external clients (Gronroos, 2000, p.307; Landman, 2005, p.7).
Du Plessis and Boshoff (2008, p.3) defined internal communication as "The communication between people working together to achieve individual or collective organisational goals". Internal communication, also referred to as 'organisational communication', is the process of communication between the people within the organisation (Scheffer & Crystal, 2008).
Intra-organisational communication is the channels and systems of communication within the organisation. It entails the continuous design of interaction between all members of an organisation forming an all-inclusive device that joins people and structures within that organisation. Intra-organisational communication forms part of internal communication. Internal communication includes many configurations and disciplines of communication, for example interpersonal communication, intrapersonal communication, intra-organisational communication and management communication (Van der Walt in Verwey; Du Plessis, & Barker, 2006, p.264; Landman 2005, p.7).
Gronroos's (2000, p.7) perspective on service marketing describes it as an organisation taking the view that an enhanced offering is required to support the customers' value-generating processes and that the core solution of a physical product, service or combination of services and goods, is not sufficient to differentiate the offering from those of competitors. Landman (2005, p.8) defines service marketing as an approach to an organization's market that recognizes that the external customer becomes an active part of its processes, and that an organisation in its totality and in all its facets determines the quality of service delivered to the customer.
This chapter presents the review of related literature. According to Chandran (2004), the aim of literature is to provide the researcher with knowledge and understanding of the conceptual and analytical framework in their field of study. This chapter examines, analyzes and adds to the knowledge advanced by various scholars in regard to the effectiveness of intranets to communicate the brand message to its internal publics within Standard Chartered Bank of Kenya. It highlights various works in relation to the study. It looks into current literature on theory and practice in relation to internal communication strategies adopted by banks to its internal publics.
Internal Corporate Communication
Internal communication within an organisation is dependent on a number of factors including the type of industry; the structure of the organisation; organisational culture and managerial style (Kitchen, 1997; Quirke, 2000). Holtz (2006) noted that, in the past, company communication, typically in the form of publications, consisted of the four 'B's: birthdays, babies, brides and bowling scores. In marked contrast, today, the function of internal communication includes the transmission of organisational goals, activities, new developments, achievements and personal contributions as well as strategic visionary messages (Welch & Jackson, 2007). Welch and Jackson (2007) suggest the function of internal communications has four dimensions: (1) internal line management, (2) internal team peer communication, (3) internal project peer communication and (4) internal corporate communication (as illustrated in Table 2.1 on page 18).
Table 2.1 Internal communication matrix
Internal line management communication
Personal impact e.g. appraisal discussions, team briefings
Internal team peer communication
Team information, e.g.
team task discussions
Internal project peer communication
Project group colleagues
Project information e.g. project issues
Internal corporate communication
Strategic managers/top management
Organizational/corporate issues e.g. goals, objectives, new developments, activities and achievementsSource: (Welch & Jackson, 2007, p.185)
These four dimensions emphasize that the content of internal communication has moved from the four B's into all areas of the organisation including strategic goals and personal development. In addition to the content, the four dimensions also highlight the two-way relationship between employees and managers at all levels of the organisation and the importance of internal communication to organisational success (Tourish, & Wilson, 2002; Zetterquist & Quirke, 2007) with effective internal communication leading to improved productivity, reduced absenteeism, increased levels of innovation, higher quality of services and products and reduced costs (Argenti, 2007).
A 2002 study of internal communication in 100 leading blue-chip companies found that 38 percent of internal communication teams were governed by the human resources department (Quirke, 2003). Four years later a 2006 online survey of internal communications conducted by Melcrum, an internal communication research and training organisation, alternatively proposed that of the 1,149 respondents from different industries and locations, 44 percent state internal communication is the governance of the corporate communications department (Dewhurst, 2007).
Kalla (2005) suggests that suggests that there are four domains of integrated internal communication; business, management, corporate and organisational. Business communication addresses the communication skills of all employees, management communication focuses on the development of the managers' communication skills and capabilities, corporate communication focuses on the formal corporate communication function, and organisational communication addresses more philosophically and theoretically oriented issues
Figure 2.1 Integrated internal communications
Source: (Kalla, 2005, p.306)
According to Argenti (2007) suggestions that events within the last twenty years, such as the bursting of the dot-com bubble, collapse of some of the most high profile firms in America (e.g. Enron) and the outsourcing of jobs to foreign countries, has "further necessitated strong communication channels between management and employees to win employee trust and loyalty" (p.54). Therefore, an additional theme to emerge from the literature involving internal communication management is the importance of trust by the employees towards management -with trust evolving from good internal communication.
The behavior of employees, especially in the sector of services, defines the manner in which customers, as well as other stakeholders, perceive the company. Employees are the company's interface with its stakeholders, so they are frequently called the â€•ambassadorsâ€- of the company. They deliver the company's value and its identity, and in that way they impact the formation of image and reputation. If employees identify with the values and aims of the company, they will behave accordingly and exert positive influence on other stakeholders. The part played by corporate communications to achieve the desired effect is implemented through internal communications which include communications between internal stakeholders. The goals of internal communications include (Welch & Jackson, 2007): Promoting employee commitment to the company; Creation of a sense of belonging to the company; Getting to know the environment and changes, as well as understanding corporate goals in the context of events taking place in the environment. The final objective is to achieve employee satisfaction and enhance their business performances (White et al, 2010), which defines the role of internal communications in achieving business results.
Du Plessis and Boshoff (2008, p.3) defined internal communication as "the communication between people working together to achieve individual or collective organisational goals". Internal communication process is used to maintain good relationships, describe tasks, give instructions and communicate the goals and philosophy of the organisation (Ferreira, 2006). Effective internal communication is a major contributor to the success of change initiatives in organisations. In particular, at the individual level, appropriate internal communication helps employees to understand both the need for change, and the personal effects of the proposed change (Goodman & Truss, 2004). Carr et al. (1999) distinguished two separate communication methods; push and pull communication: Push communication drive information into the organisation without any employee-initiated action or request. It is effective for dissemination of information needed and/or wanted by a large number of people. Examples include; email; reports and distributed newsletters; Voice mail and compulsory meetings. Pull communication mechanisms require employees to seek information. Examples include; web, shared files, databases, and information system; libraries and reference books and voluntary meetings. A blend of push and pull communication is required for alignment in the organisation. Pull communication can be used to extract information about status of various initiatives, projects and daily performance measurements. Push communication is effective in outlining the strategic direction of a business (Carr et al., 1999).
Communication can be conducted through a variety of media such as face- to-face, telephone, fax, e-mail, paper-based messages and video-conferencing. The communication media selection is critical in the knowledge transfer process. "Media differ in their level of richness, or the extent to which they possess the following qualities: inherent capacity for immediate feedback, number of cues and channels, personalization and language variety" (Schenkel, 2004, p.49). High-media rich communication is personal and involves face to face contact, while low-media rich communication rely on the forms, rules, procedures and databases. Murray and Peyrefitte (2007) classified communication media, when it is used as key knowledge sharing activities, into three categories: technology-assisted communication, meetings, and training methods. For each of these categories there are elements that are high in media richness and that are low in media richness. Murray and Peyrefitte (2007) further distinguished high-media rich, technology-assisted communication (videoconferencing) and high-media rich communication (face to face).
It is impossible to determine universal rules given that the form of communication depends on the type of information conveyed, employee structure, positions among which communication is conducted and plenty other factors. The criteria applied to determine media to be used to send a message may include: availability of channels to a group of employees targeted by the message, characteristics of employee groups targeted by the message, message contents, speed at which the message should be sent to employees etc. In one of most recent researches (Welch, 2012), it has been determined that employees prefer electronic media in internal communication, then combined electronic and print formats, and then only print formats. In choosing the channel of communication it may be dangerous to assume that all employees share the same preferences. Therefore, it is necessary to identify internal stakeholders (important groups) and according to their preferences to select the channel of communication.
Du Plessis et al (2004, p.31) state that intra-organisational communication is perceived as a component of the communication process in the organisation, but that it is in actual fact the "encompassing whole or context of all levels of communication in the internal environment of the organisation. These levels are determined by the hierarchical structure arranging the members of the organisation and include intrapersonal communication, interpersonal communication and small-group communication (Du Plessis et al., 2004, p.31). Intrapersonal communication focuses on the individual and its ability to interpret messages from the environment.
Interpersonal communication usually occurs between two people in a face-to-face encounter (Du Plessis et al., 2004, p.31) and may take the form of written, oral or non-verbal communication methods. Small group communication is the process of three or more people communicating to achieve a common goal. The functions of intra-organisational communication include; Knowledge branding (Eppler & Will, 2001, p.447); Interaction of knowledge between individuals in an organisation (Tucker et al., 1996, p.2); Fostering a work climate that is supportive of creativity (Williams, 2001, p.64); Delivering the service quality message to all employees (Schneider, 2004, p.146); Assisting in developing mental models, intellectual capital and a knowledge database (Parasuraman et al., cited in Gronroos, 2000, p.75; Senge, 2001, p.279; Yen & Chou, 2001, p.80); Promoting internal marketing to improve employee performance, involving aspects of recruitment, training, motivation, retention, affiliation and the provision of long-term employee satisfaction (Hardaker & Fill, 2005, p.367) and strategic alignment by communicating the "big picture" (Mersham & Skinner, 2001, p.69; Puth, 2002, p.204).
Communication and Branding: A Service-Oriented Approach
Gronroos (2000, p.265) introduces the concept of total communication impact (everything the organisation says about itself and its performance and everything the organisation does that has an impact on the customer and the service oriented approach) to minimize the size of the gap between the expectations and experiences, determining the quality perception. The interrelation of the various means of communication and their effects are highlighted together with the factors such as the technical quality of services, culminating in the total service-oriented image or brand of the organisation (Gronroos, 2000, p.265).
The traditional approach to studying brands is focused on how the brand is applied to customers and to investigate customers' perceptions of the same; however, this is slowly changing. It has been shown through research (Barrow & Mostley, 2005; Sartian & Shuman, 2006) that the concept of the brand also exists in the minds of other stakeholders -for example employees; and that this aspect of the brand as it applies to employees is just as important, if not more important especially in the service sector where employees are in essence the embodiment and ambassadors of the brand. Noble et al., (2002) note that organisations that have developed successful brands are the ones where all areas of the organization are committed to the branding process; thus, employees are now viewed as playing a crucial role in brand management as they are the interface between the organisation and the market.
Brand identification is argued to be a precursor of employees' brand commitment, which is defined as "the extent of psychological attachment of employees to the brand, which influences their willingness to exert extra effort towards reaching the brand goals" (Burmann & Zeplin, 2005, p.284). Employee commitment is the degree to which employees identify with and are involved with the brand; are willing to exert additional efforts to achieve the goals of the brand and are interested in remaining with the organisation. Employee commitment to the brand is most essential in the service sector where it is the 'extra touch' that the employees add to their work that provides a memorable brand experience to the customers and makes them want to come back for more and enhances their staying power with the organisation. Therefore, the objective of employer branding is to convince employees that their organisation is a good workplace, to retain them and ensure both their understanding of the organization's goals and commitment to them (Sullivan, 2002; 2004).
Internal Communication: A Theoretical Approach
Fletcher and Major (2006) contend that the world is growing smaller as technology advances and the creation of more advanced technology introduces organisations to different channels of internal communication, spanning both time and geographical distance. Fletcher and Major (2006) suggest four basic channels are used in workplace communication (1) face-to-face meetings, (2) audio or telephone exchanges, (3) video mediated conferences, and (4) computer-mediated text transfers. Literature on communication channels almost exclusively focuses on media richness theory (Kahai & Cooper, 2003; Salmon & Joiner, 2005; Sheer & Chen, 2004).
Markus (1994) defines media richness theory as a "prescriptive model in which achieving a match between information processing requirements (e.g., uncertainty and equivocality reduction) and communication channels (e.g., face-to-face interactions and written memos) was posited as essential for organizational effectiveness" (p.503). Essentially the premise is that lean media is used by managers for simple topics and rich media is for more complex topics (Sheer & Chen, 2004, p.79) so the focus of media richness theory is on the choices made by the managers, not necessarily the employees.
According to this perspective there are four factors that influence media richness: "the ability of the medium to transmit multiple signals (e.g., vocal inflection, gestures), immediacy of feedback, language variety, and the personal focus of the medium" (Dennis & Kinney, 1998, p.258). Media richness theory typically places channels on a continuum from rich to lean media with face-to-face communication considered the richest followed by telephone, email and written documents (Salmon & Joiner, 2005). The media richness continuum places written documents as the leanest channel of communication.
Sheer and Chen (2004) state that there are three separate categories of written documents within media richness theory: personal written text (letters, notes, memos); formal written text (documents, bulletins) and formal numeric text (computer output, statistical reports). Face-to-face communication is considered the richest channel primarily due to the ability to give immediate feedback as well as the amount of information shared during the interaction in the form of verbal cues (tone of voice, pitch, volume) as well as non- verbal cues(Kahai & Cooper, 2003). Non-verbal communication is defined in its broadest sense as "communication that transcends the bare elements of the written or spoken word" (Gabbott & Hogg, 2000, p.386).
According to Gabbott and Hogg (2001) there are four key channels of non-verbal communication including "proxemics (the use of personal space and distance); kinesics (body postures and movement); oculesics (the communicative aspects of eye behaviour such as gaze and movement) and vocalics (para-language such as vocal tone and intonation)" (p.6). In addition, Gabbott and Hogg (2000), emphasize that non-verbal communication takes place in every interaction, whether intentional or not and can be impacted by three specific variables: gender, culture and personal traits. These factors can affect the interpretation of the non-verbal cues and often creating misunderstandings. Each of these four key channels of non-verbal communication are particularly important in the context of media richness theory, as the media richness varies depending on the strength and presence of nonverbal and verbal cues (Sheer & Chen, 2004).
However, Berry (2006) suggests that although management literature examining communication uses face-to-face communication as the standard, the literature does not adequately consider time-related problems inherent in face-to-face communication. In fact, face-to-face communication relies on participants being in the same place at the same time (Hargie & Tourish, 2004) which is not always possible. In agreement, Quirke (2000) adds that time is "the most limited resource in most organizations and better use can be made of precious face-to-face time which is too often used for the wrong purposes -to tell people things they could more easily read about, in meetings which are badly run and boring" (Quirke, 2000, p.32).
According to media richness theory, the telephone is the second richest channel after face- to-face communication; however, Salmon and Joiner (2005) state that recent research suggests the telephone "as a mode of transmitting and receiving management information, has been superseded by the use of email, because of the superior functionality and usability features of email" (p.57). Shaw (2004) states that organisational intranets, team briefings, e-mail and newsletters are the "bread and butter of modern communication" (p.22). In fact, O'Kane, Hargie and Tourish (2004) argue that traditional communication channels such as memos, letters and phone calls have been replaced by emails, the most preferred communication channel in the business world.
The success of email is due in part to its asynchronous nature where the sender and receiver do not have to be present for the communication to occur (Thomas et al., 2006), as well as being able to cross "physical, social, temporal, and psychological boundaries at an astonishingly low cost" (Berry, 2006, p.352). In addition, research suggests that email reduces interruptions caused by face-to- face meetings and telephone conversations thereby improving managerial efficiency as well as having the added advantage of being able be read around the clock (Thomas et al., 2006). The ability to communicate at any time in any place with anyone is increasing opportunities for interaction. Using e-mail, instant messaging, and cell phones, a manager's ability to stay engaged within the workplace is greater than ever before. In fact, multitasking has become synonymous with the communication technology-infused workplace of today (Turner & Reinsch, 2007, p.36).
Many organisations have employees that are geographically located in diverse areas; email enables information to be sent regardless of location and/or time zone (Salmon & Joiner, 2005, p.62). E-mail has now become the dominant force in written communication (O'Kane et al., 2004) and has made email processes such as deleting and not responding to messages, an acceptable communication process in the 21st century (Tassabehji & Vakola, 2005). Emails can be sent quickly without serious thought given to the content or proofreading of the reply, resulting in a form of non-verbal identity, where the choice of informal or formal vocabulary or grammar describes the sender.
Thomas et al., (2006) states that e-mail overload can stem from "(a) the sheer volume of e-mail messages sent every day, (b) poorly written messages or messages that violate netiquette, and (c) the variety of ways that users use their email systems" (p.256). Within media richness theory, the inability for immediate feedback or ambiguity in messages as suggested by Thomas et al., (2006) is what defines e-mail as a lean channel of communication (Salmon & Joiner, 2005). Today's technological environment of emailing and intranet, media richness theory is deemed, by some, as "not a useful theory for explaining the effects of the use of the new media on task performance" (Dennis & Kinney, 1998, p.14). In addition, they suggest that the theory is not based on empirical research (Kahai & Cooper, 2003) and that managers surveyed have been asked which media would be the best choice for a theoretical situation rather than measuring the actual performance results of media use (Dennis & Kinney, 1998).
The literature also notes that little empirical research has been undertaken regarding effectiveness of intranets to communicate the brand message to its internal publics within the Kenyan banking sector. Research now suggests that managers make different choices when choosing a channel to communicate information than those prescribed by media richness theory (Byrne & LeMay, 2006) and that consideration should be made for contextual factors such as the capabilities and appropriateness of using particular mediums (Watson-Manheim & Belanger, 2007).
There are several forms of technology that have not been considered in media richness based research, possibly due to their relatively recent introduction, including video-conferencing, blogging, instant messaging or video/DVD use. Based on the criteria for media richness, specifically the need for two way communication, organisational videos or DVDs could be, in fact, categorized as a lean channel of communication. Additionally, extensive research into recent academic literature has not unearthed any discussions on intranet usage in accordance with media richness theory, so uncertainty exists as to where on the channel continuum intranets would be placed. It may be reasonable to conclude; however, that the intranet is a lean channel on the media richness continuum due in part to the lack of feedback and synchronicity. Alternatively the intranet may also be considered a richer channel than email due to the amount of information it is possible to store and share.
Lehumskallio (2006) defines intranets as "networks, built and maintained within the company firewalls, offering Internet technology and various contents for the exclusive use of the company staff" (p.291) and suggests that intranets are not only for information storage and retrieval but also for enhancing communication within the organisation and information flow. An additional purpose is to increase productivity and the quality of work, connect departments located elsewhere (Bottazzo, 2005) as well as introduce the latest guidelines, tools and news through a simultaneous cost effective medium (Lehmuskallio, 2006). Studies show that the versatility and multifaceted nature of intranets has seen an increase in research that is largely multidisciplinary (Lehmuskallio, 2006).
Table 2.2 on page 29 illustrates the two most important layers of communication taking place within SCB Kenya limited namely; communication taking place between and among its internal employees and communication taking place between and among its customers and business partners. Employees in companies participate in internal communications. The responsibility for its success falls on everybody. However, its initiation, steering and control are the responsibility of human resources and corporate communications departments. It is exactly the field of internal communications that represents the aggregation of impacts made by both sectors. Managing communications in a company requires, in the first place, determining employee satisfaction with their job, workload, deadlines, colleagues, their manager and other factors. This is mainly the responsibility of the human resource sector. The corporate communications sector should engage in the part related to planning communications with employees with a view to ensure effective and successful work performance, as well as the development of the employees sense of belonging towards the company and their commitment.
Table 2.2 Internal and external communication of SCB Kenya limited
Means of communication
Official SCB Kenya limited website
Email via Microsoft Outlook
Self service banking
Marketing of products and services to customers
Statistics, monitoring of problems, approvals and information to staff via SMSs
Private branch exchange (PBX)
Cell phone banking
Telephone calls (local, national and international)
Telephone calls (local, national and international)
Self-service banking via Internet, telephone and ATM
Face-to-face with managers, tellers and enquiry staff
Source: (Author, 2013)
Internal communication should be a holistic process which integrates multiple functions of the organisation by ensuring employees understand all aspects of business operations and are motivated in a service-oriented manner. Effective employee communication must start with the research of the preferred methods of communication (Ewing, 2005; Rayburn, 2007). However, in organisations which essentially are involved in services, both the external customer as well as the user (service provider) relationships inside the organisation is fundamentally important. This concept translates into support required by employees and departments in a seamless manner as described in the conceptual framework below.
-Promote commitment to the organization
-Promote awareness of its changing environment
-Promote understanding of its evolving aims
-Promote a sense of belonging to the organization
Internal line management communication
Internal line corporate communication
Internal team peer communication
Internal project peer communication
Independent variables Dependent variables Outcomes
Figure 2.2 Conceptual framework
Source: (Author, 2013)
Research methodology is the process adopted in conducting the study. The steps involved in conducting the study are described in detail and this helps other researcher's in understanding the study particularly where replication may be desired. Research design aids in the allocation of the perceived limited resources by coming up with crucial choices in methodology (Cooper & Schindler, 2007). This chapter therefore discusses the research design, study areas, target population, sample population, sampling procedure, and research instruments. It further analyzes the instruments' validity and reliability, data collection and analysis procedures; and ethical considerations of the study.
A research design is the arrangement of conditions for collection and analysis of data in a manner that aims to combine relevance to the research purpose (Kothari, 2004). The research design is the conceptual structure within which research is conducted; it constitutes the blueprint for the collection, measurement and analysis of data and the design includes an outline of what the researcher will do from writing the hypothesis and its operational implications to the final analysis of data (Brace, 2004). Generally, the design which minimizes bias and maximizes the reliability of the data collected and analyzed is considered a good design (Kothari, 2004). The question of a good research design is related to the purpose or objective of the research problem and also the nature of the problem to be studied. The different research designs are namely experimental, exploratory and descriptive (Kothari, 2004).
Experimental design represents a model of how to infer correlations between variables. It is suitably used for research in social policy and sometimes to access the importance of reforms in policies (Brace, 2004). Also known as causal research or hypothesis-testing studies, involve testing hypotheses for causal relationships between variables. These experimental studies require procedures that will not only reduce bias and increase reliability, but will permit drawing inferences about causality. In essence causality studies deal with cause and effects of the problems (Mugenda & Mugenda, 2003).
According to Chandran (2004), the main emphasis of exploratory studies is to provide familiarity of new insights and discovery of new ideas to the researcher. Exploratory study designs formulate a study for a more precise investigation and are particularly useful when a researcher lacks a clear idea of the problems he/she will meet during the study. Descriptive studies on the other hand are concerned with describing the characteristics of a particular individual or of a group. They answer questions of who, what, when, where and how in a given topic (Chandran, 2004). The studies lead to a profile development of a situation or a group of people by acquiring complete and possible accurate information. Diagnostic studies on the other hand share common characteristics with descriptive designs and are concerned with discovering and testing whether certain variables are associated. According to Bryman (2001), descriptive studies reports the way circumstances are; by describing elements such as possible behavior, attitudes, values and characteristics. This study will adapt a descriptive research design.
Case study research excels at bringing us to an understanding of a complex issue or object and can extend experience or add strength to what is already known through previous research. Case studies emphasize detailed contextual analysis of a limited number of events or conditions and their relationships. Case studies are preferred where an empirical investigation is carried out on current phenomena in its real context and multiple source evidences are used (Kothari, 2004). According to Bryman (2001), a case study involves a detailed and intensive analysis of a single case such as an organization, a community, a family amongst others.
All data relevant to the case are gathered and organized in terms of the case. It provides an opportunity for the intensive analysis of many specific details often overlooked by other methods (Kumar, 2005). This approach rests on the assumption that the case being studied is typical of cases of a certain type so that, through intensive analysis; generalization may be made that will be applicable to other cases of the same type (Kumar, 2005).
Population of Study
According to Mugenda and Mugenda (2003), a population is made up of the entire group of people on which a research is going to be conducted. Peil (2005) says that a population entails all the cases or individuals that fit specifically for being sources of the data required to address the research problem. Population may be limited by geographical location or any other characteristic such as age and gender. The total number of SCB Kenya limited employees is 1698, with a total of 33 branches spread across the country.
According to Mugenda and Mugenda (2003, p.41) target population is defined as a group of individual(s) to which the researcher would like to generalize his/her results from. It comprises of all potential participants that could make up the study group. This research will define its target population from all the PROs/ Corporate communication managers and CSOs from the 33 branches. This comprised 33 branches that make up SCB Kenya limited (See Appendix II). The chosen respondents will be best placed to answer on the effectiveness of intranets to communicate the brand message to internal publics.
Table 3.1 Target population
A sample is a small subset of the population that has been chosen to be studied. Sample size is the number of cases or entities in the sample studied (Cooper & Schindler, 2007). Mugenda and Mugenda, (2003) define a sample as the smaller group obtained from the accessible population. Zikmund (2003) advises that, sampling is used when time and cost considerations prohibit total events in a predefined population. Brace (2004), points out that a 10-20% of accessible population is accepted in a descriptive research and Chandran (2004) states that a sample size of any study should be based on what a researcher considers to be statistically logical and practicable. For this study,
Sampling techniques is the method a researcher applies to determine the members or items of the target population to be included in the study. Sampling is that part of statistical practice concerned with the selection of an unbiased or random subset of individual observations within a population of individuals intended to yield some knowledge about the population of concern especially for the purposes of making predictions based on statistical inference. Sampling is an important aspect of data collection (Adèr, Mellenbergh, & Hand, 2008).
In his definition of sampling, Kothari (2004) viewed sample method as a way of selecting a portion of population such that the selected portion represents the population adequately. According to the law of statistical regularity, any groups of objects taken from a large group of objects possess the same characteristics as the large group. The second law holds that, the larger groups are more stable than the smaller groups owing to the compensating effect of deviations in opposite directions. Sampling is done in order to minimize costs, increase the speed of data collection, improve on accuracy of results and enhance the availability of population elements (Cooper & Schindler, 2007).
According to Mugenda and Mugenda (2003), there is the probability and non-probability sampling techniques. Probability sampling techniques are those where the principle of equal opportunity for all members of the selected population is the norm ensuring equal opportunity and reducing bias. Probability sampling is based on the concept of random selection procedure that assures that each population element is given a known non zero chance of being selected. Probability methods include random sampling, systematic sampling, and st
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