Employee Rebranding The Case of Vivacom

Transcription

1 Employee Rebranding The Case of Vivacom Master s thesis within International Marketing Author: Tutor: Jönköping May 2012 Denitsa Velikova Georgina Todorova Adele Berndt

2 Master s Thesis in International Marketing Title: Author: Tutor: Employee Rebranding: The Case of Vivacom Denitsa Velikova, Georgina Todorova Adele Berndt Date: Subject terms: Corporate branding, corporate rebranding, employee branding, employee resistance, internal communication, internal marketing, psychological contract, service branding Abstract Problem: Rebranding in the services is a recent trend, which brings focus to the importance of the employees in this process. Their attitudes, perceptions and views need to be considered by the management when creating the internal communication strategy related to the rebranding in order to direct the employees to the desired brand image. This raises the problem as how employees perceive the management`s rebranding efforts. Purpose: This study aims to focus on how rebranding is executed and communicated internally to the employees of the company. It is interesting to find out how the employees evaluate the communication strategy that the management implements and how they perceive the new image of the company. In order to get insight to the internal rebranding process the correlation between the perceived image by the employees and the components of the internal communication strategy is presented. Methodology: The empirical approach is a case study of the Bulgarian telecommunication company Vivacom. The research includes two interviews with the management of the company and a questionnaire based on the interviews and the relevant literature, which was sent to the employees of the company. Moreover, company`s documentation and website were used to complement the information. Conclusions: The results helped us identify the decisions that the management made regarding the rebranding and the internal communication. The quantitative data indicated the relatively positive attitudes and views of the employees for the management`s rebranding efforts. They also showed good knowledge and awareness of the new brand elements.

3 Acknowledgements Firstly, we would like to sincerely thank Vivacom and especially Adriyana Mihaylova, Simona Tcharakchieva and Stiliyana Stancheva for their kind and patient cooperation and contribution to this thesis. Secondly, we would like to express our deepest gratitude to our supervisor Adele Berndt for all her support and guidance during the semester. Furthermore, we are also thankful to all our teachers and colleagues at JIBS who also gave their contribution for successfully delivering a master`s thesis. Finally, we are grateful to our families and friends who supported us throughout the whole study year.

4 Definitions Corporate Branding The combination of marketing efforts that a company undertakes to make a controlled representation of its values and identity (Balmer, 2001). Corporate Rebranding The practice of building anew a name representative of a differentiated position in the mindset of stakeholders and a distinctive identity from competitors (Muzellec, Doogan & Lambkin, 2003, p. 32). Employee Branding The process by which employees internalize the desired brand image and are motivated to project the image to customers and other organizational constituents (Miles & Mangold, 2004, p. 68). Employee Resistance Employees` resistance to changes inside or outside a company (Strebel, 1996). Internal Communication The communications transactions between individuals and/or groups at various levels and in different areas of specialisation that are intended to design and redesign organisations, to implement designs, and to co-ordinate day-to-day activities (cited in Welch & Jackson, 2007, p. 179). Internal Marketing Any form of marketing within organization which focuses staff attention on the internal activities that need to be changed in order to enhance external market place performance (Ballantyne, Christopher & Payne, 1995, p. 15). Psychological Contract The individual beliefs, shaped by the organization, regarding terms of an exchange agreement between individuals and their organization (Rousseau, 1995, p. 9). Service Branding The promise of the bundle of attributes that someone buys the attributes that make up a brand may be real or illusory, rational or emotional, tangible or invisible (Ambler & Styles, 1996, p. 10).

5 Table of Contents 1 Introduction Background Problem Discussion Purpose Delimitations Disposition Introduction Frame of Reference Methodology Case findings Discussion Conclusions Frame of Reference Corporate Branding Corporate Branding Framework Service Branding Corporate Rebranding Corporate Rebranding Framework Internal Marketing Internal Employee Branding Employee Branding Process Employee Resistance Internal Communication Conceptual Framework of Employee Rebranding Process Methodology Research purpose Research Strategy Research Method Data Collection Secondary Data Primary Data Sampling Method Interviews Questionnaires Data Analysis Analysis of the Qualitative Data Analysis of the Quantitative Data Credibility Reliability Validity Case Findings Qualitative Data Results Background The New Brand i

6 4.1.3 The Rebranding of Vivacom Vivacom`s Internal Rebranding Quantitative Data Results Reliability Respondents Descriptive Statistics Hypotheses Testing Discussion New Brand Decision Corporate Branding Vision Image Corporate Values Internal Communication Strategy Sources of Messages and Messages from Employee`s Perspective Psychological Contract Employee Brand Image Employee Resistance Conclusion Limitations Future research List of references ii

7 Appendix Appendix 1- Industry Spread of Rebranded Companies Appendix 2 Descriptive Statistics Appendix 3 Test for Normality Appendix 4 Scatterplots Appendix 5 Spearman`s Rank Order Correlation Appendix 6 Interview with Adriyana Mihaylova Appendix 7 Interview with Simona Tcharakchieva Appendix 8 Questionnaire iii

8 1 Introduction In this chapter the background of the research topic about internal rebranding will be presented. After that the identified problem in the topic, followed by the purpose and the research questions of the thesis will be discussed. The delimitations to the topic and the disposition of the paper will be presented at the end of the chapter. 1.1 Background A brand is traditionally presented in the literature in the field of marketing as a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors (cited in Chernatony & Riley, 1998). This definition, introduced firstly by the American Marketing Association in 1960 has been adopted by many specialists in the field such as Aaker and Kotler (Chernatony & Riley, 1998). However, brands and brand management have evolved gradually during the years, exceeding the traditional perceptions and claims of consumer-goods marketers (Kotler & Pfoetsch, 2007). The importance of brands for the companies in every industry has significantly grown (Kotler & Pfoetsch, 2007) and it turns them into one of the most valuable assets for the firms (Kaikati & Kaikati, 2003). Therefore, the building of a strong brand, has started to be closely related to the economic and strategic values that it brings to the company`s brand image (Kaikati & Kaikati, 2003). According to Coleman, Chernatony and Christodoulides (2011), a special integration between marketing and human resources has to be made in order to build a strong brand, especially when the company works in the service sector. This special collaboration has to be expressed in the way HR department communicates and tries to integrate the service brand identity when recruiting people and when training employees (Coleman et al., 2011). One of the outcomes of a research conducted in 2005, clearly shows the power of branding. The research involved 23 out of 30 major German companies, trading on the Frankfurt Stock Exchange, and the basic measurement executed in the research was a comparison of their financial market performance. As a result from the research, it turned out that companies with strong brands performed much better than those with weaker brands. The strong branded companies recuperated faster from the fall-off on the stock market after the terrorist attack on 11 th of September 2001 than the companies with weaker brands (Kotler & Pfoetsch, 2007). However, constructing the brand successfully does not assure the stable development of the company`s brand in the future, due to the dynamic current market. Companies need to revise and relook their brands in order to keep abreast with trends of the modern world. As Merrilees (2005) notes brand evolution is one of the important components for a successful strategy. Rebranding is part of this evolution. Many reasons for rebranding have been identified by the researchers. They claim that rebranding should take place if a change in the business mix has occurred such changes are changing consumer needs, globalization, mergers and acquisitions, etc. (Goi & Goi, 2011). 1

9 A valuable example is the rebranding of France Telecom after acquiring Orange in The strength of the Orange brand affected the image and future performance of France Telecom (Ridgeon, 2007) so positively that in 2004 the company was announced as a number one mobile operator and internet provider in France and number two mobile operator in Europe (Melewar, Hussey & Srivoravilai, 2005). Nevertheless, the effects of a rebranding process may be questionable. Several studies have been conducted to investigate the effects of rebranding on brand equity (Muzellec & Lambkin, 2006). It is stated that rebranding is costly, time-consuming (Causon, 2004) and some problems arise such as loss of consumer loyalty, loss of market share and loss of choices (Kapferer, 2004). Moreover, as the corporate rebranding practices increase in number, the failure rate of corporate rebranding is stated to be high compared to success rate (Stuart & Muzellec, 2004). An example of failed rebranding efforts is the transformation of the UK Post Office to Consignia during The cost of the unsuccessful rebranding process to the Post office was 2 million pounds and additionally 1 million pounds for the replacement with its old name Royal Mail (Muzellec & Lambkin, 2006). 1.2 Problem Discussion Stuart and Muzellec (2004) note that the term rebranding in the current business literature means and is used as a brand being reborn and they view corporate rebranding as the changes in the company`s name, logo or slogan. The fact that rebranding can occur on three levels in an organization corporate level, strategic business unit level and product level, should also be mentioned (Lambkin & Muzellec, 2008). Rebranding is defined as the practice of building anew a name representative of a differentiated position in the mindset of stakeholders and a distinctive identity from competitors (Muzellec, Doogan & Lambkin, 2003, p. 32). However, the employees always influence the outcomes of a rebranding, no matter on which level it is executed. This is due to the fact that employees are the ones who interact most intensively with customers, especially in the service sectors, and thus they affect and form the image that these customers have of the brand (de Chernatony, 1999; Ind, 2003). Moreover the negative effects on the staff will transfer to the customers, because the behavior and even the appearance of the employees signal that something has changed in the company. Therefore, it is crucial for the management to properly communicate to its employees the changes in the company. Studies have been made on rebranding of companies in different industries. Some researches focus on the service sector in particular. Most of them investigate rebranding in companies from the banking and telecommunications industries. According to research which included 166 companies, representing more than 40 industries, the information technology and telecommunications industry is the largest category of rebranded companies with its 22.3% (Muzellec, Doogan & Lambkin, 2003). The industries were compressed into 12 different industry types. Appendix 1 presents the results of this study. The authors suggest that the reason for this result is the advancement of technologies and the large number of mergers and acquisitions that have taken place in the IT and telecommunications industries in recent years. Researchers have studied several cases of rebranded telecommunications companies such as France Telecom, Eircom, Vodafone Ireland, etc. 2

10 Eircom and Vodafone Ireland have been used as success cases in the studies of Muzellec and Lambkin (2006) and Daly and Moloney (2004). Rebranding in the services and especially in the telecommunications industry is a recent trend that needs to be further explored. As the workforce in the service sector represents the product of a service (Richey, 2002), the employees need special attention when changing a brand. The marketing management needs to focus on employees` attitudes, perceptions and views in order to direct them to the desired brand image. In rebranding a service company, the communication strategy and the whole process are of great importance. This raises the problem as how employees perceive these rebranding efforts. 1.3 Purpose The rebranding process in service companies from employee`s perspective can be regarded as insufficiently investigated in the literature. The way rebranding is executed and communicated in this type of companies is strongly related to the employees who take part in creating the image of the brand and who represent the direct connection with the ultimate customer. Since a significant part of the rebranded firms worldwide belongs to the telecommunication industry, the authors have decided to look in depth in the rebranding process of the largest Bulgarian Telecommunications company Vivacom. In this study the authors are going to focus on how rebranding is executed and communicated internally to the employees of the company, aiming as a result to answer the following research questions: What decisions does the management make about rebranding? Which are the components of the internal communication strategy used by management in the rebranding process? How do the employees evaluate the internal communication regarding the rebranding which the management uses? To what extent the desired image is perceived by the employees? Is there a correlation between the employees` perceived image and their evaluation of the channels, messages and changes in the rebranding process? The way the management tries to reach its employees in the rebranding process plays a major role in the successful brand transformation. Therefore it is interesting to find out how the employees evaluate the communication strategy that the management implements and how they perceive the new image of the company. In order to get insight to the internal rebranding process the correlation between the perceived image by the employees and the components of the internal communication strategy will be presented. 1.4 Delimitations This thesis will focus on the process of rebranding related to the internal branding of the employees in the specified company. The research of the rebranding process will be from managerial and employees` point of view, thus concentrating on internal communication rather than external activities. Moreover, the research will be undertaken for one particular company in one specific industry, which will limit the generalizations from the analysis. Another issue will be the time distance from the rebranding campaign as Vivacom rebranded in The views and opinions of the employees may have faded way, since the rebranding, which is why the results from the investigation may not be the closest to reality. Nevertheless, the effects of the rebranding campaign are expected to be noticeable, as rebranding is a slow process and its implementation takes a lot of time. 3

11 1.5 Disposition The outline of this thesis will go as follows: Introduction The topic of the thesis is presented in this chapter. The area of interest is discussed and the research questions are defined. At the end of the chapter the delimitations of the thesis are presented and finally the disposition is explained Frame of Reference The literature review will be presented in this chapter by focusing on the relevant theories and models for the purpose of the research. The frameworks that will be used as a basis for the research and analysis will be also discussed Methodology The methodological reasoning of the research is presented in this chapter. The approaches, methods and techniques that have been chosen and used during the research will be explained, as well Case findings In this chapter are described the key findings from the interviews and the documentation provided by the investigated company, followed by the corresponding questionnaire results Discussion Analysis of the qualitative and quantitative data will be provided in order to answer the research questions of this thesis by following the conceptual framework of the employee rebranding process, described in Chapter Conclusions In this chapter the outcomes of the conducted research in the thesis will be comprised. Moreover, the shortcomings of the paper will be highlighted and the suggestions for future research presented. 4

12 2 Frame of Reference In this chapter a review of the literature will be made by highlighting the important and relevant theories and models. Firstly, the authors will discuss the theories related to corporate branding and the elements and components which are included in the literature. The goal is to see how a company brands itself initially and which the important issues that need to be considered when a company rebrands itself. Then, the concept of rebranding will be presented together with the corporate rebranding framework in order to describe the essence of rebranding and the rebranding process in general. To narrow down the topic, branding in the service sector will be briefly discussed, since the company being investigated is in the telecommunication sector. Finally, theory regarding internal marketing, employee branding, employee resistance and internal communication within a company will be presented in order to follow the role of the employees in the rebranding process and to emphasize the importance of communication strategies inside a company. 2.1 Corporate Branding The concept of product branding historically involves the view that the brand`s role is to differentiate a product or service in customers` minds (Knox & Bickerton, 2003). Kapferer (1997) defines a brand as a symbol which distinguishes the products and services of one company from the products and services of another company. Product branding nowadays is characterized by layers around the core functionality of a product or service. These layers add value to the product or service and make it distinctive in the market (Knox & Bickerton, 2003). Similarly, a corporate brand`s objective is to create differentiation and preference (Knox & Bickerton, 2003). The main difference is that in corporate branding these activities are managed at the organization`s level and not at the product`s or service`s level. The importance of the organization and its role as a strategic element in the process of branding has been a focus for discussion in the branding literature (Knox & Bickerton, 2003). Corporate branding is described by de Chernatony (1997) as a strategy involving the same name for the company and the brand. A corporate brand can be defined as the combination of marketing efforts that a company undertakes to make a controlled representation of its values and identity (Balmer, 2001). Hatch and Schultz (2003) discuss corporate branding by trying to distinguish it from product branding. As they state, in the highly competitive environment, companies need to differentiate themselves by positioning the whole organization and not only its products or services. This will mean that the organization itself will be in the center of marketing and the values and emotions that it stands for will be the key elements for differentiation. A strong corporate brand is claimed to be of great importance when creating positive perceptions and attitudes towards existing or new products of the company (Brown & Dacin, 1997). Furthermore, studies discuss the important role of employees in the corporate branding process as they build the relationships with the stakeholders and are involved in building the meaning of the brand (Hatch & Schultz, 2003). The stakeholders of an organization include customers, suppliers, employees, investors, local communities, regulators and other partners of the company (Harrison & Freeman, 1999; Hatch & Schultz, 2003). Another issue brought up by Hatch and Schultz (2003) is the fact that by branding a company, the organizational behavior becomes more visible and transparent which increases the importance of a good corporate culture. 5

13 Differentiation is not the only thing that corporate branding is about. It is also about belonging (Hatch & Schultz, 2003). Stakeholders will feel that they are part of this set of values and emotions that the organization is symbolizing if the branding works as it is intended. The strong corporate brand attracts the key stakeholders, gives them a sense of belonging and keeps them active by helping them experience and express their values (Hatch & Schultz, 2003). The main differences between corporate and product branding are the following (Hatch & Schultz, 2003): Corporate branding creates transparency in terms of corporate actions Decisions are made on higher executive level Targets not only customers, but also other stakeholders of a company Management of a corporate brand involves all departments of a corporation, not only the marketing department Corporate brands are long-term and more strategic Corporate Branding Framework Hatch & Schultz (2003) propose a framework (see Figure 2.1) for understanding corporate branding, which was further discussed and developed by Knox and Bickerton (2003). The framework has three key components which are linked together - strategic vision, corporate images and organizational culture. They need to be consistent and coherent in order to build a strong and credible corporate brand. These three elements will be discussed briefly in the next paragraphs as explained by Hatch & Schultz (2003). Figure 2.1 Framework of Corporate Branding (Hatch & Schultz, 2003) Strategic Vision Strategic vision has been defined as a coherent and powerful statement of what the business can and should be (ten) years hence by Wilson (1992, p. 18). He states that vision is needed if companies want to reduce the uncertainties related to the market in the long run. Vision gives direction and a destination for a company which strives for success. Hatch and Schultz (2003) define strategic vision as the main idea that the management of a company strives for as achievements in the future. As Collins and Porras (1994) also describe it, it is what the organization wants to be in the future. However, Hatch and Schultz (2003) state that even if a company wants to follow new goals it will need to relate them to the heritage of the company, otherwise drastic changes may mean losing credibility. An interesting note made by them is that instead of using stakeholders` image for a company to 6

14 compare it to organizational vision, this image can be used in the process of developing the strategic vision Organizational Culture Hatch and Schultz (2003) define organizational culture as the values, beliefs and basic assumptions embodying the heritage of a company. Culture is communicated to the company`s members which represent the organization afterwards. As these authors also claim, the organizational culture could be a competitive advantage for a company if the values expressed by the corporate brand are in accordance with its culture and core values. Organizational culture is reflected on the organizational behavior. Therefore, credible brand values will help to create correspondence between what the brand promises and what the organization delivers (Hatch & Schultz, 2003) Corporate Image Hatch and Schultz (2003) talk about organizational image mainly in the model of corporate branding. Corporate images as defined by Hatch and Schultz (2003) are the views that stakeholders have of a company and the way the world sees it. Corporate brands affect not only the images that consumers have of it, but also have impact on the images held by the stakeholders of organizations (Hatch & Schultz, 2003). The image of a company enhances its attractiveness and reputation if managed in consistence with the vision and culture, because it indicates more clearly who the company is and what it stands for (Hatch & Schultz, 2003). The image is also related to the communicated to the stakeholders distinctiveness, as well as their perceptions of the company. The objective of images is to generate brand equity by influencing the stakeholders behavior (Hatch & Schultz, 2003). Furthermore, the image and the culture form the brand promises related to the brand experience that the company offers (Hatch & Schultz, 2003). The authors further explain that before communicating externally, the companies talk to themselves in order to confirm the self-image. Sometimes the external images, which are the actual images that the stakeholders hold, may differ from the images that the company holds internally, which are the desired images. When the company understands and acknowledges this difference, it will be able to work for narrowing this gap (Hatch & Schultz, 2003). 2.2 Service Branding McDonald, de Chernatony, & Harris (2001, p. 340) define services as an activity which has some element of intangibility associated with it. They also add that services involve some interaction with the customers or property in customers` possession, which does not end with transfer of ownership. Moreover, a change of condition may occur and services may not be associated with a physical product (McDonald et al., 2001). Services also are characterized with intangibility, inseparability of production and consumption, heterogeneity and perishability (Shostack, 1977; Edgett & Parkinson, 1993). If services are managed properly and sustained successfully, they can be considered a competitive advantage because they will be more difficult to copy (Doyle, 1989). However, services depend on the organizational culture and the employees, which make it difficult to create successfully services. The most appropriate definition for service brand, as de Chernatony and Segal-Horn (2003) claim, is the one proposed by Ambler and Styles (1996, p.10) the promise of the bundle of attributes that someone buys the attributes that make up a brand may be real or illusory, rational or emotional, tangible or invisible. This definition includes two of the characteristics of services intangibility and heterogeneity, and depicts service brands as a 7

15 set of functional and emotional values (de Chernatony & Segal-Horn, 2003). The focus on the service process involves finding employees that have similar values to the organizational culture and employees that would behave according to the brand promise. An organizational culture which emphasizes the importance of the interaction and relationship with the customer may help in creating a strong service brand. 2.3 Corporate Rebranding Muzellec et al. (2003, p. 32) define rebranding as the practice of building anew a name representative of a differentiated position in the mindset of stakeholders and a distinctive identity from competitors. It is also described as a change in the identity of an organization or an attempt to change the stakeholders` perceptions of the company (Muzellec & Lambkin, 2006). In other words, rebranding is more or less some kind of change and it may be a long process. Rebranding can occur on several levels. There may be rebranding on corporate level, strategic business unit level or product level (Lambkin & Muzellec, 2008). According to Daly and Moloney (2004), rebranding involves changing both tangible and intangible elements of a brand. Therefore, corporate rebranding can be seen as a continuum from minor changes to complete renaming. However, rebranding should also lead to an actual change in the organization as well (Hankinson & Lomax, 2006). As McGurk (1997) suggests, rebranding may involve changing of the image of the company. The results of a rebranding may be doubtful because as Kapferer (2004) notes a rebranding may lead to loss of choices, loyal customers and market share. With the branding process a company builds its vision, culture and image, which also helps to create the equity of the brand. Name awareness is also related to brand equity. Therefore, change in the name will mean nullifying of all the branding efforts undertaken by the company during the years and may damage the existing brand equity (Muzellec & Lambkin, 2006). The motives and reasons for rebranding are various and they can be not only negative (e.g. bad reputation), but also positive (e.g. acquisition of the company). Rebranding may occur when the company feels that the brand needs refreshing or updating if it is outdated. As Duncan notes, rebranding should take place only if there is some kind of change in the business mix dictating a need for evolving the brand. It is also important for the company to really say something new to the stakeholders and to communicate it properly, otherwise the rebranding process may turn out to be not so effective (Stuart & Muzellec, 2004). Goi and Goi (2001) summarize the different reasons for rebranding and divide them into external and internal drivers (see Table 2.1). 8

16 Table 2.1 Summary of rebranding drivers (Goi & Goi, 2001). Stuart and Muzellec (2004) claim that in the literature rebranding means that a brand is being reborn. However, it is true when the rebranding process involves a change only in the name of the company. Stuart and Muzellec (2004) argue that corporate rebranding involves not only a change in the name, but also in the logo or slogan. They further divide the type of changes into revolutionary and evolutionary. The revolutionary change includes changing of the three elements name, logo and slogan, whereas evolutionary change includes only the slogan or the logo. Corporate rebranding can take place in several ways: Change of name and logo Change of name, logo and slogan Change of logo only Change of logo and slogan Change of slogan only A change in the name only is not mentioned, because such a drastic change will always involve change in the other two elements also. As a company`s name is the primary means for communication to the stakeholders, a change of it may be quite risky as what is being communicated will change dramatically (Stuart & Muzellec, 2004). Changes in the logo and 9

17 slogan are also important elements in the branding and rebranding processes. Logo relates to the company through its shape and colors, and a change in a logo without any obvious reasons will be either unnoticed or looked at with suspicion. Change in the slogan, on the other hand, has a lower risk than changes in the name or logo. However, they are also important as a slogan change will mean change in the positioning of the company (Stuart & Muzellec, 2004) Corporate Rebranding Framework Daly and Molony (2004) propose a corporate rebranding framework (see Figure 2.2) based on their research with the management, the personnel and the customers of companies that rebranded themselves. The framework includes three main stages analysis, planning and evaluation. The key elements of the framework are situation analysis, the renaming strategy, communication and training strategies and the rebranding marketing plan. Figure 2.2 Corporate rebranding framework (Daly & Moloney, 2004). The first step in the rebranding process is analyzing the market, the customers` preferences, the competitors and the management`s and employees` attitudes. Brand audit is also important in this stage. Afterwards, the new brand decision is made, which is formed as a result from the identification of the brand elements that need to be maintained permanently and those brand elements that need to be retained only temporarily. After their identification the company can distinguish brand elements that have to be removed in the process of rebranding. The next step of the rebranding process is making communication 10

18 strategies for targeting the external and internal customers. After analyzing the attitudes of the employees the company will need to develop training programs and communication strategies for the internal customer. In this way the employees will support the process of rebranding, will be more committed to it and will be trained in the acquiring company`s policies and procedures (Daly & Moloney, 2004). The communication strategy for the external customers involves developing of renaming strategy and rebranding marketing plan. The last step in the rebranding process is the evaluation of the previous stages and campaigns in terms of the goals and objectives that have been set in the process. Corporate rebranding needs to be carefully considered by the management of a company and if they decide to rebrand they will need to sustain the level of consistency and continuity while doing so. As with corporate branding, the employees should also be involved in the process of corporate rebranding (Muzellec & Lambkin, 2006). 2.4 Internal Marketing The idea to consider employees as internal customers, used in the corporate rebranding framework of Daly and Moloney (2004) and already illustrated in Figure 2.2.is stated to be derived from internal marketing literature. In fact the important role of employees in service organizations is broadly discussed not only in the concept of internal marketing but in the concepts of relationship marketing and service branding as well. The recognition of employees` role in service marketing led to further focus and development of the concept of internal marketing (Tansuhaj, Randall & McCullough, 1988). George (1990) defines internal marketing as a strategic weapon for providing high-quality service and a high-level of customer satisfaction in an organization. Moreover he investigates the positive impact that organizational behavior can have on the successful implementation of internal marketing program (George, 1990). However Ballantyne, Christopher and Payne (1995) describe the internal marketing as any form of marketing within the organization which focuses staff attention on the internal activities that need to be changed in order to enhance external market place performance (Ballantyne et al., 1995, p. 15). As a result of numerous researches in the field of internal marketing, different description of the employees and their role in marketing activities can be met in the literature. Several of them will be further discussed. Gummesson (1987) explains that all the employees except those working in the marketing department in the organization are in fact part-time marketers because they execute the direct contact with the ultimate customer. Their skills and level of customer orientation influence the perception of the customer towards the quality of services, provided by the company as a whole (Gummesson, 1987). Therefore part-time marketers have to be motivated and well trained in order to be aware of their marketing tasks and accordingly to be able to accomplish them (Grönroos, 1994). The other vision about the role employees play in a company already mentioned in the paper emphasizes that the employees have to be treated as internal customers and their job as the internal product in the context of internal marketing (Berry, 1981). The extent to which a service company succeeds to attract, motivate and keeps high- quality working force lead to providing of better services to the external customers (Berry, 2002). The approach of looking at the internal marketing as a starting point for developing the external marketing strategy has been adopted by many researchers in the field (George, 1990; Grönroos, 1994; Berry, 1981; Piercy & Morgan, 1991). Furthermore Piercy and Morgan (1991) suggest that along with the external marketing program an internal one has to be also developed in the organization in order to implement 11

19 successfully the company`s marketing strategy on the external and internal market. In their research they adopt the idea about the role of employees in the organization as customers and introduce the concept to use the same elements of the external marketing program but in internal market context. Thus the elements, presented by Piercy and Morgan (1991), include product, price, communication and distribution. The product in the internal marketing program refers to the values, attitudes and behavior that the employees (customers) have to acquire whereas the price expresses the psychological cost they pay in order to adopt company`s culture. Moreover the level of directness (e.g. face-to-face interaction, written reports etc.) and the tools (meetings, committees, training sessions) used for communicating different marketing messages to the employees indicate the communication and distribution of the internal marketing program (Piercy & Morgan, 1991). 2.5 Internal Employee Branding The concepts of internal marketing and service branding are used by companies for defining their marketing strategy and the way they decide to approach the customer. The building of the company`s brand can be identified as a part of the implementation of the company`s strategy and it is stated to be strongly influenced by the employees` work (Miles & Mangold, 2004). Therefore the employee branding is an important process that has to be taken into account especially when changes occur in the companies, providing services, which is the case with the rebranding process. Miles and Mangold (2004) describe employee branding as the process by which employees internalize the desired brand image and are motivated to project the image to customers and other organizational constituents. Moreover it is emphasized that the successful employee branding depends not only on how the organization tries to project the desired image in the minds of employees but also on how quickly it succeeds to transfer it in the employee`s minds. The speed of the projection of the image matters because the employees have to perceive the right image before carrying it over to the customers and other stakeholders (Miles & Mangold, 2004). Furthermore King and Grace (2008) suggest that employee branding serves as a glue for shaping the employee`s behavior in accordance to the desired image and in order to achieve consistency in service experience and satisfaction of customer`s expectations Employee Branding Process Many researchers indicate the importance of employee branding and its positive outcomes to the company`s survival and competitiveness but an explanation of how it has to be integrated in the marketing of the company seems to be under conceptualized (Miles & Mangold, 2004). However Miles and Mangold (2004) propose a model of how the process of employee branding takes place in the organization, including all the factors and steps that have to be taken in consideration by customer oriented companies (See Figure 2.3). 12

20 Figure 2.3 Employee Branding Process (Miles & Mangold, 2004). The relationship between the organization and its employees play a vital role for the proper functioning of any company and especially in employee branding. The organization has to gain deeper knowledge about the structure of this relationship and to understand it completely in order to communicate the desired image to its employees (Miles & Mangold, 2004). The model, suggested by Miles and Mangold (2004) explains this relationship by suggesting several stages or perspectives that have to be considered in order to understand the interaction between the organization and its employees. These stages comprise the source of messages in this interaction, the employee`s perceptions in the context of psychological contact, the resulting interpretation of the employee brand image and the consequence and outcomes from the employee branding process (Miles & Mangold, 2004) Source of Messages The projection of the values and expectations of the organization towards its employees is executed by messages, communicated by different internal formal and informal communication channels as well as different external formal and informal sources. As the organization may not have the influence in all the sources of information, it is really important for it at least to be aware of the possible paths of messages that can affect the successful adoption of the organizational values by the employees. The messages communicated and controlled by the organization are required to be characterized with clarity and consistency (Green, Walls & Schrest, 1994). The information transferred by the human resource management such as recruitment documents, company`s website, newspapers, training and development are stated to form the first impressions of the employees about the company and to establish the employee`s first expectations about the job content. These messages consist of information about what are the company`s values and goals and what is the required employee behavior in the organization. The essence of it can be reinforced from the management system in terms of what is the importance of the link between performance and rewards. In addition it can also be strengthened from the public relations department of the company by sending external messages that are consistent with the internal ones in order to avoid employee`s confusion and loss of trust towards the company (Miles & Mangold, 2004). 13

21 Moreover the coworker influence on the employee`s perception of the desired image, as well as the influence of the organizational culture must not be underestimated by the organization. They can impact the right understanding of the message and can lead to adopting an image, different from the desired one. Advertising messages and campaigns are indicated to be also a serious external source of information that influences the employee branding process. The organization has to be careful in formulating the advertising messages and keep them addressed not only to customers but to the employees as well, in order to avoid inconsistency in the shared information in and out of the company. In addition the customer feedback and word-of-mouth communication can be distinguished as informal external sources of information for employees and are characterized with powerful impact on the employee`s perceptions of organizational image (Miles & Mangold, 2004) Psychological Contract The next step differentiated in the model of employee branding process is related to the principles of the concept of psychological contract (Miles & Mangold, 2004). According to Rousseau (1995) the psychological contract refers to the individual beliefs, shaped by the organization, regarding terms of an exchange agreement between individuals and their organization (Rousseau, 1995, p. 9). It expresses the employee`s perception about how the company has agreed to treat her/him in the organization in exchange of adoption of a certain behavior such as work performance, pursuit of the organizational goals and learning of organizational culture. Thus the employee can expect from the organization to be fairly rewarded according to their efforts to adjust to the company`s requirements, giving them the opportunity to grow in the organization, for instance. Any kind of unexpected change in the organization can be perceived as a violation of this psychological agreement between the parties. It can lead to negative outcomes such as decreased loyalty towards the organization, reduced employee`s productivity and negative word-of-mouth. Therefore it is crucial for the company to try to meet the employee`s expectation in communicating clear and consistent messages through all the channels (Rousseau, 1995) Employee Brand Image The successful projection of the desired image depends on the extent to which the message of the organization is successfully communicated to the employees and the psychological contract has been fairly established between the parties. After the adoption of the brand the employees are ready to project with the same success the brand image into the customer`s perceptions. However the motivation of the employees is stated to affect the development of the employee brand image. Moreover, if the brand promises are perceived by the employees as broken, they will also start questioning the ability of the organization to fulfill the brand promises towards the customers (Miles & Mangold, 2004) Consequences The consequences from a successful development of the employee brand can result not only in increased employee performance and satisfaction, but it can also lead to customer and employee retention and decreased employee turnover. However negative consequences can occur if the projection of the desired brand image is not transferred adequately to the employee and if the psychological contract is perceived to be violated by the organization. These negative outcomes can comprise negative word-of-mouth communication, decreased result performance, lost employee and customer loyalty (Miles & Mangold, 2004). 14

22 2.6 Employee Resistance As already explained, corporate rebranding involves changes in different aspects. As Armenakis, Harris and Mossholder (1993) note, the companies rely increasingly on their employees to adapt to different changes in the environment inside or outside the company. However, the employees often resist changes (Strebel, 1996). Employee resistance is an important issue that has to be taken into account when a company undertakes an organizational change of any kind. It can turn into an important barrier against innovation into the company and can affect negatively the competitiveness of the company as well as the outcomes from the innovation itself. One reason for this reaction is the fact that the employees usually associate the organizational change or any innovation with lay-offs, skill obsolescence and personnel reshuffles (Zwick, 2002). Moreover Zwick (2002) claims that the level of employee resistance depends on the reason behind the organizational change. If the decision for implementation of new innovation in the organization is related to some negative aspect of the business development of the company, the likelihood of internal resistance increases (Zwick, 2002). In addition Zwick (2002) argues that the resistance in lower educated workers in the organization is expected to be higher than the resistance of higher educated employees because of the increased flexibility and the ability to adapt to the latter. However another approach for investigating the reasons for employee resistance and its consequences is suggested by Oreg (2006). The employee resistance is explained through investigation of tridimensional attitude of the employee towards change, consisting of affective, behavioral and cognitive components (Oreg, 2006). The affective component reflects employee`s feelings about the change such as anger or anxiety whereas the cognitive component refers to the employee`s thoughts whether the change is really needed and beneficial for the organization or not. Moreover the last (behavior) component conveys how the employee intents to react to the change i.e. whether she/he decides to encourage the change or she/he dislikes the change and tries to sabotage it. Although each component underlines a different aspect from the phenomenon of employee resistance, they sometimes can be perceived as one and the same thing (Oreg, 2006). After understanding better the nature of the employee resistance a special management approach is needed to be used for preventing the resistance. One of the more broadly suggested in the literature way to manage the employee resistance is to involve employees in the process of change (Cox & Makin, 1994; Waddell & Sohal, 1998; Kotter & Schlesinger, 2008). Their involvement in the learning, planning and implementation stages of the change process can lead to decreased employee resistance. Moreover it is suggested that if the management assures the two- way communication, consultation and information sharing in the organization, the employees will become more committed to the occurring changes (Waddell & Sohal, 1998). 2.7 Internal Communication Frank and Brownell (1989) define the internal communication as the communications transactions between individuals and/or groups at various levels and in different areas of specialization that are intended to design and redesign organizations, to implement designs, and to co-ordinate day-to-day activities (cited in Welch & Jackson, 2007, p. 179). Internal communication plays an important role in the process of establishing the strategy, culture, values and personality of the organization and it can strongly affect the company`s sustainability and competitiveness (Dunmore, 2002). The need for efficient internal communication of the organizational change is stated to be broadly discussed by many researchers in 15

23 the field (Nelson & Coxhead, 1997; Daly, Teague & Kitchen, 2003; Proctor & Doukakis, 2003). They all emphasize that the integration of the internal communication in the external one is essential for the successful communication strategy and for the survival of the organization (Nelson & Coxhead, 1997; Daly et al., 2003; Proctor & Doukakis, 2003). Regardless of the type of the occurring change in the organization, the internal communication in the company represents a powerful tool for managing the different arising sources of resistance to the changes (Proctor & Doukakis, 2003), such as, for instance, the employee resistance appears to be. Moreover the results from studies have shown that the poor internal communication in the organization is sometimes the principle reason for the failure of organizational change program (Murdoch, 1997). Furthermore in order to implement successfully the internal communication strategy in the process of change in the organization several best practiced models can be identified. One of these models is presented by Quirke (2008) where seven area or links for consideration are distinguished (see Figure 2.4) including the following activities: identifying the required for employees attitudes and behavior (strategy area), presenting inspirationally the organizational goals in order to build commitment (leadership area), setting a plan for communicating clear messages to the employee (planning and prioritization area), coordination of the messages in order to avoid overload of information (channel management), engaging professionals in managing the communication channels (the internal communications functions area), explaining face-to-face the information and the reasons behind the organizational change (face-to-face communication area) and establishing standards for assessing the communication effectiveness and functionality (impact measurement area) (Quirke, 2008). Leadership Strategy Planning & prioritization Impact measurement Channels & content management Face-to-face Communication roles Figure 2.4 Seven links of communication (Quirke, 2008). 16

24 Three steps for a successful internal communication are identified in the strategy link of communication. They include the clear identification of the strategy of the organization, the desired by the company employees behavior and the use of the communication for helping the employees to achieve this behavior and to understand the strategy. In addition Quirke mention that the communication in a successful company in time of changes is characterized by rapid response and strong established links between the strategy, planning, IT functions and marketing. Furthermore the next communication link discussed by Quirke (2008) concerns the communication of the leaders in the organization. The importance of consistent message, clear organizational purpose and principles and strongly identified focus in the way the leadership communicate in the organization is emphasized in this model. In other words these characteristics of the communication have to remain the same no matter of the different leadership style, practiced in the company (Quirke, 2008). The link, following the leadership communication link in the model of Quirke (2008) is identified to concern the planning and the prioritization in the organization. The company has to not only set clear priorities and plan its internal communication but also it has to revise its communication goals and activities periodically in order to be able to manage employees` reaction when a change occurs (Quirke, 2008). The channel management link for communication indicates that the messages about the changes have to be not only transferred to the employees in the organization but also they have to carry meaning to them. The way the employees have to prioritized the load of information transferred in the process have to be clarified in the message which means that the coordination between the channel have to be assured by the management (Quirke, 2008). Regarding the internal communication link, it emphasizes that the internal communicators has to be aware of the business strategy and to understand it completely, because only then they will be able to communicate properly the message to the employees of the company (Quirke, 2008). Moreover the communication in face-to-face link from the model refers to the belief that nothing can replace the result from face-to-face interaction and presentation of information in the company. Even though this form of communication is time consuming and the internet can provide the needed information the interaction from the face-to-face communication are emphasized to be more effective (Quirke, 2008). The impact measurement link for consideration in this model illustrates the importance not only of clear identification of goals in the communication program but also a regular evaluation of how successful they are achieved. Moreover Quirke (2008) claims that the periodical appraisal of the communication that the management execute in the company, is needed in order to increase the quality of this communication (Quirke, 2008). 2.8 Conceptual Framework of Employee Rebranding Process As already clarified the purpose of this thesis is to find out what are the decisions that the management makes regarding the rebranding and the internal communication strategies during the rebranding process. Employees` attitudes and understanding of these strategies and the achieved results also are a focus of the thesis. In order to achieve these goals, the authors are going to use four models derived from the theories. As a special framework regarding the internal rebranding process could not be found in the existing literature on the 17

25 topic, the authors will present an adapted framework (see Figure 2.5), combining the following, already mentioned in the paper, models: corporate branding model (Hatch & Shultz, 2003), corporate rebranding framework (Daly & Moloney, 2004), the employee branding model (Miles & Mangold, 2004) and the model of seven links of communication (Quirke, 2008). The framework is developed only for the purpose of this thesis, and based on it will be designed the interviews and the questionnaire. Furthermore, the analysis and discussion of the qualitative and quantitative data will follow the stages of this framework. The reasoning behind the links between these models will be presented by an explanation of each step of the derived framework. 1. New Brand Decision 2. Corporate branding: Vision, culture, image 3. Internal communication strategy 4. Sources of messages and messages: Formal internal communication 5 Interpretations: Psychological contract 6. Perceptions: Employee brand image Figure 2.5 Conceptual framework of employee rebranding process. 1. The first step in the elaborated in the paper framework includes the new brand decision taken in the company and derived from the corporate rebranding framework suggested by Daly & Moloney (2004). The new brand decision is related to the components of the new brand after the identification of the ones which have to be removed (Daly & Moloney, 2004). Moreover it serves as a basis for the decisions that the management makes in terms of corporate branding and which are presented as a second step in the conceptual framework. 2. The second step includes the corporate branding model of Hatch & Shultz (2003) which explains the consistency between the corporate vision, culture and image in the company. These three elements from the corporate branding model will be the basis of the messages that the company will send to its employees during the rebranding. 3. Furthermore the internal communication strategy is distinguished as a third step in the conceptual framework. This part deals with the strategies that the management plans in order to project the new values, culture, vision and expectations. It includes a description of the internal communication strategy, presented in the cor- 18

26 porate rebranding framework (Daly & Moloney, 2004). Additionally some features from the model of the seven communication links of Quirke (2008) are also presented in this step in order to complement the theory in the section. Furthermore, the next three steps in the conceptual framework are part of the employee branding model, proposed by Miles and Mangold (2004). 4. The fourth step of the conceptual framework includes the source of messages, which includes messages and their paths for reaching the employees. This part deals with the how when implementing the internal communication strategies. Therefore, it is essential for the messages sent and the channels used to be clear and consistent. It should be made clear that in this paper the main focus is on the formal internal communication, as part of the whole strategy. 5. The fifth step is the perceptions of the employees and it includes the psychological contract. It is important step from the internal rebranding as during the rebranding the perceptions of what is expected from the employees may change as a result. Such changes will influence the interpretations that the employees make in the next step. 6. The interpretation step refers to the success of projecting the desired image. It is the consequence of all other previous steps and depends highly on their consistency. The successfully projected desired images will lead to successfully projected brand images to the customers. As already mentioned, the presented conceptual framework will serve as a basis for designing the interview guidelines and the questionnaires. It will also be used as a guideline for the analytical chapter of this thesis. 19

27 3 Methodology In this chapter the methodology will be presented. The choice of approaches and methods that are relevant to the research problem will be explained. The techniques used in the research process will also be presented. 3.1 Research purpose Research purpose is classified in three types of studies. The first one is descriptive study, which according to Robson (2002) aims to depict persons, events or situations. The second one is explanatory study, aiming to explain relationships between variables and establish causal relationships (Saunders, Lewis & Thornhill, 2007). The third type of research purpose is exploratory study and it is related to exploring and investigating phenomena in a new light (Robson, 2002). Exploratory studies are appropriate for understanding the nature of the problem. Its advantage is its flexibility as it allows changing the direction of the research. Such research can be conducted with literature review, focus groups or interviews with experts (Saunders et al., 2007). Rebranding has been largely discussed in the literature in order to reveal the consequences from such action on customer`s perceptions and more specifically on brand equity. However, the role of the employees, especially in the service sector, has not so widely been studied. Therefore, this research will be exploratory, as our goal is to understand the nature of internal rebranding and to gain insights in the topic in terms of management practices and internal communication strategies. The employees` perceptions of these practices and communication strategies will also be studied in the context of the telecommunication company Vivacom. 3.2 Research Strategy The strategy used in this paper is case study. It is defined as a strategy using empirical study of a phenomenon within its real life context (Robson, 2002). In this case the boundaries between the phenomenon and its context are blurred (Yin, 2003). Case studies are appropriate for in-depth analysis of a phenomenon and when answering why, what or how questions (Morris & Wood, 1991). For this type of research a variety of data collection techniques can be used often in combination. A specific characteristic of case studies is the triangulation of various sources of data in order to make sure that data are telling you what you think they are telling you (Saunders et al., 2007, p.139). Yin (2003) classified case studies as single and multiple cases, depending on the number of cases used in the research. He also divides case studies into holistic studying a phenomenon in a single unit, and embedded when investigating more than one unit. In this thesis, we will use a case study of a telecommunication company that has rebranded. Even though various sources of information will be used, triangulation of the sources is not appropriate for this research, since it will not measure one and the same thing. Depending on the findings generalizations will be presented. Moreover, the case study will be holistic as the organization as a whole will be investigated. 20

28 3.3 Research Method There are two types of data collection techniques and data analysis procedures. The first type is quantitative which involves gathering and analyzing numerical data and statistical tools. Popular technique for such data collection is the questionnaire. The other type is qualitative involving non-numerical data. Qualitative research can be analyzed using words, pictures and video clips. The results of an interview or a focus group can be analyzed with this technique. In a research either only one technique can be used, known as mono method, or more than one technique, known as multiple methods (Saunders et al., 2007). In this research multiple methods will be used by collecting data both through interviews and questionnaires. 3.4 Data Collection The process of gathering information in the specific field of research and the observed case is needed in order to answer the research questions of this study. It is called data collection in the literature and can include primary and secondary data categories, according to the type of conducted research and the used sources. The secondary data comprises already available information for the researched area such as reports, newspapers whereas the primary data is the information collected especially for the purpose of the research. Therefore collecting secondary data can be evaluated as a suitable tool for providing valuable information about already carried out investigations of the problem in hand. It is found to be an appropriate tool for gaining knowledge also in our researched area and it will be included in our data collection approach. Primary data will be collected, as well, through conducting interviews and questionnaires and will complement the information gathered on the researched topic (Saunders et al., 2007). Table 3.1 Data collection. Qualitative data Quantitative data Type Semi-structured interviews Self-administered questionnaires Respondents The management of the company Employees of the company Sampling method Non-probability; Judgmental Sampling Non-probability; Sampling Judgmental Distribution channel question- Internet-mediated naires Internet and Telephone interviews Question formulation On the basis of literature review On the basis of the information gathered from the interviews and the literature review Question type Open questions Close questions Data analysis techniques Narrative Descriptive; Spearman`s Rank Order Correlation 21

29 3.4.1 Secondary Data Different classifications of secondary data can be found in the literature. According to Saunders et al. (2007), secondary data can be divided in: documentary data e.g. organizational databases, organizational websites, reports; survey-based data e.g. censuses, continuous and regular surveys, Ad hoc surveys; multiple sources e.g. books, journals, industry statistics etc. For the purposes of this study documentary secondary data will be used, which in general could represent written or non-written materials (Saunders et al., 2007), and also multiplesource secondary data, such as books and journals. Literature review will be made as a multiple source secondary data, including gathering information, related to the area of the present research from books, journals and articles. Thus the collected information serves as a base for conducting the study in hand and helps to develop the research idea and questions before starting to draw up the thesis and also along the way of writing it. However, the multiple source secondary data is not the only type of secondary data that is going to be considered in the research. The research questions are investigated in the context of the case study of a telecommunication company. Therefore documentary secondary data such as organizational websites and written reports of the company`s rebranding process, communicated by the firm, will be present in the paper. Byrman (1898) claims that documentary secondary data is often used in researches in which primary data is also collected, which is the case in this study Primary Data Malhotra and Birks (2006) define the primary data as the information originated by the researcher especially for the objectives of a particular study. In the primary data section of this thesis the sampling method and the sampling size will be presented, followed by description of the chosen data collection instruments and data analysis techniques Sampling Method Sampling techniques embrace different procedures for decreasing the quantity of information in the research through collecting information only from selected subgroups with relevant characteristics for the inquiry (Saunders et al., 2007). Since a case study strategy is adopted for this thesis investigating the internal rebranding of an organization, the sample of the research represents the company s employees. Depending on the probability of which part of the population can be or cannot be selected to participate in the research, the sampling can be divided into the following major types (Saunders et al., 2007): probability sampling; non-probability sampling. For the interviews, participants in the rebranding process in Vivacom from the marketing management were reached. Afterwards, the interviewees agreed to distribute the questionnaire to a small number of employees, since distribution to a larger number of employees was not achievable. This makes the choice of respondents, non-probability judgmental sampling. In this type of non-probability sampling technique, the researcher selects the cas- 22

30 es and the sample on the basis on her/his own judgment so that she/he will get the answers of the research questions and the purpose of the inquiry (Saunders et al., 2007). Afterwards, only those respondents who met the criteria for being an employee before, during and after the rebranding of Vivacom in 2009 were included in the data analysis Interviews Interviews are stated to be really useful for collecting reliable data and for adjusting the objective and the research questions of this study. On one hand the questions asked on interviews must reflect coherently the purpose of the research and the adopted research strategy, but the information collected during the interview can give more precise direction of these dimensions as well (Saunders et al., 2007). Saunders et al. (2007) identify three basic types of interviews, according to the degree of standardized questions and level of structure: structured interviews; semi-structured interviews; unstructured or in-depth interviews. Structure interviews are intended to use strongly defined questions without any free interaction between the person who is interviewed and the one who conducts it whereas the unstructured interviews convey the process of open discussion between the participant and the administrator, without the presence of predetermined questionnaire. However, there is one version or type of interviews that carries a part of the characteristics of both types, which were described above. Because of its position in between, this type of interviews is called semi-structured interview and actually presents the kind of interviews that will be undertaken in this research study. The layout of the semi-structured interview includes list of themes and questions which have to be covered, but are not highly structured. The questions can vary depending on the flow of exchanged information between the administrator and the interviewed person (Saunders et al., 2007). Generally two semi-structured interviews with the management of the Bulgarian telecommunication company Vivacom were carried out. One of the interviews was carried out vie Skype, and the other one was a telephone interview, since a personal interview was not possible to conduct due to the fact that the researchers are in Sweden and the interviewees are in Bulgaria. The questions asked on the interviews concerned the following topics: the rebranding decision, the company`s vision, mission, values, image after the rebranding, the internal communication strategy used in the process and the identification of employee resistance. After conducting them, the results served as a basis for developing the questionnaires which were distributed to the employees of the organization. It should be noted that the interviews were held in Bulgarian and translated in English afterwards Questionnaires Different definitions of a questionnaire exist in the research literature. Malhotra and Birks (2006, p. 326) define a questionnaire as a structured technique for data collection consisting of a series of questions, written or verbal, that a respondent answers, whereas devaus (cited in Saunders et al., 2007, p. 360) determine the questionnaire as a general term to include all techniques of data collection in which each person is asked to respond to the same set of questions in a predetermined order. The questionnaire is a suitable tool that can be used in a case study research. Several types of questionnaires can be identified according to 23

31 Saunders et al. (2007), depending on the role of the administrator. If the administrator records the respondent`s answer after each question, the questionnaire can be categorized as interviewed-administered and if the respondent fills in the question form on her/his own, the questionnaire is self-administered (Saunders et al., 2007). For the objectives of the present study, self-administered questionnaires were distributed to the employees of Vivacom. They were developed on the basis of the conducted interviews with the management of Vivacom as well as on the basis of the theoretical framework discussed in Chapter 2. The questions of the questionnaires are divided in the following eight themes: company`s vision, values, image, source of messages, messages, psychological contract, employee resistance and demographics. They can be determined as internet-mediated questionnaires because their administration was electronical (Saunders et al., 2007). For this purpose Qualtrics was used for designing and sending the questionnaires. The questionnaire developed in this thesis consists of one answer questions, multiplechoice questions and Likert scales. The Likert scale is widely used for measuring respondents` overall attitudes and opinions by indicating their level of agreement or disagreement with a series of statements about the stimulus object (Malhotra, 2004). The scale items in the questionnaire, designed for the purpose of this thesis, have five response options. The respondent`s total score for each category was calculated and the highest scores indicated the most favorable attitude towards the different category. Before sending the questionnaire to the respondents, a pretest was conducted on the people who helped in the distribution, in order to test the questionnaire as a whole and to identify potential problems (Malhorta, 2004). This helped to eliminate such problems before the official distribution of the questionnaires. As already mentioned, the respondents were reached with the assistance of the interviewees, who agreed to distribute the questionnaire to a small number of employees. It should also be noted that the questionnaires were held in Bulgarian and translated in English afterwards. 3.5 Data Analysis After being collected, the primary data in this research has to be analyzed in order to answer the research questions of this study. The primary data comprises collecting information through both quantitative and qualitative methods Analysis of the Qualitative Data Distinct ways of analyzing qualitative data can be indicated in the literature. One common qualitative analysis procedure is adopted by many scholars in the field of research methods and it includes the transformation of collected information through the following steps (Saunders et al., 2007): categorization; unitising data; recognizing relationships and developing the used categories in order to facilitate the explanation and analysis; developing and testing theories to reach conclusions. This procedure is found suitable for both highly structured and fairly structured interviews, regardless of the chosen research approach. As mentioned before in this paper, the interviews were semi-structured and therefore the procedure explained above is appropriate to the analysis of the qualitative data. 24

32 3.5.2 Analysis of the Quantitative Data The quantitative data analysis in this thesis consists of descriptive statistics and nonparametric Spearman`s rank order correlation. The descriptive statistics includes frequency measures for the categorical variables, and measures for location and variability for the continuous variables (Malhorta, 2004). The frequency distribution counts the number of responses for different values of one variable and expresses them in percentage terms (Malhotra, 2004). The mean is the average of the values calculated by summing all the elements in the set and dividing by the number of all elements (Malhorta, 2004). The standard deviation, on the other hand, is the square root of the variance (Malhorta, 2004). Nonmetric correlation measures the relationship between two nonmetric variables and calculates the correlation by relying on rankings (Malhorta, 2004). Nonmetric variables do not assume a normal distribution and are useful for small-sized samples (Malhorta, 2004), which is the case with the sample of the present survey. For this reason, the nonmetric Spearman`s rank order correlation was conducted for examining the relationship between the variables (Malhorta, 2004). However, the nonmetric statistics are not so powerful and have lower sensitivity, which is their main disadvantage (Pallant, 2005) Hypotheses Formation As Miles & Mangold (2004) observe, the interpretations of the employees, and especially the employee brand image, depends highly on the sources of messages, the messages themselves and the psychological contract. This led the authors to question the relationship between the evaluations of these stages that the employees make. Therefore, the last research question Is there a correlation between the employees` perceived image and the scores of evaluation of the channels, messages and changes in the rebranding process? appeared. In order to answer the question three separate hypotheses will be created and then tested for correlation. a) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the channels used during the rebranding? The null hypothesis (H 0 : ρ=0) is that there is no relationship between employees` perceived image and the scores of evaluation of the channels used during the rebranding. The alternative hypothesis (H 1 : ρ 0) states that such relationship exists. The null hypothesis is rejected when the probability associated with the calculated value of the test statistic is less than the level of significance α (p<.05) (Malhotra, 2004). b) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the messages sent regarding the rebranding? The null hypothesis (H 0 : ρ=0) is that there is no relationship between employees` perceived image and the scores of evaluation of the messages sent regarding the rebranding. The alternative hypothesis (H 1 : ρ 0) states that such relationship exists. The null hypothesis is rejected when the probability associated with the calculated value of the test statistic is less than the level of significance α (p<.05) (Malhotra, 2004). c) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the changes after the rebranding? The null hypothesis (H 0 : ρ=0) is that there is no relationship between employees` perceived image and the scores of evaluation of the changes after the rebranding. The alternative hypothesis (H 1 : ρ 0) states that such relationship exists. The null hypothesis is rejected when 25

33 the probability associated with the calculated value of the test statistic is less than the level of significance α (p<.05) (Malhotra, 2004). 3.6 Credibility Credibility involves the possibility of understanding the answers from the interviews or questionnaires wrongly (Saunders et al., 2007). Therefore, this possibility needs to be reduced as much as possible. Attention should be paid to reliability and validity when discussing the quality of the gathered information and the drawn conclusions. There is a relationship between reliability and validity, which means that reliability is a necessary condition for validity, but it does not guarantee validity. If a measure is perfectly valid, then it is also perfectly reliable (Malhotra & Birks, 2006) Reliability Reliability is defined as the extent to which a measurement produces consistent results if repeated measurements are made (Malhotra & Birks, 2006). What leads to lower reliability is the existence of random error, because it produces inconsistency. That is why, if a measure is free from random error, it can be defined as perfectly reliable. Reliability puts questions such as will the same results be measured in different situations or by different observers and what methods are used to make sense from the collected data (Saunders et al., 2007). The internal consistency reliability, which measures the reliability of a summated scale, assesses the internal consistency of the set of summated items (Malhotra, 2004). This is necessary in order to ensure the consistency of the items in what they indicate about the specific characteristic (Malhorta, 2004). In order to measure the internal consistency of the summated items in this survey, Cronbach`s alpha was used. It characterizes with increasing value when the number of items increase. Furthermore, reliability of the data gathered from the questionnaires may be questioned in this research, especially in terms of participant bias. The answers that employees give may not reflect their own opinion and views, but the ones that they are expected to give. It depends on the type of organizational approach and the relationships between the management and the employees. If Vivacom has more authoritarian type of management, the employees will feel more insecure to express own opinion. In order to minimize this risk, in the beginning of the questionnaire was mentioned that the survey was anonymous and the results would be used only for the purpose of the master thesis. The contacts of the authors were also provided, in case someone needed more information. In order to avoid observer error the interviews need to be conducted using the same approach for both interviews. However, one of the interviews was held by one of the authors, whereas the other one was held by the other author, which means that different approaches for leading the interview and asking the questions may have been used. This fact limits the reliability of the data to some extent. Another issue related to the reliability of the results is the interpreting of data when there are several ways of doing so Validity Validity is defined as the extent to which a measurement is accurate and to which differences in observed scores reflect differences among the measured objects of the characteristic (Malhotra & Birks, 2006). In other words, validity concerns the question if the results are really about what they seem to be about (Saunders et al., 2007). The fact that the com- 26

34 pany rebranded a few years ago may mean that the memories or the views of the employees have blurred or faded away. That is why the responses in the questionnaires may not reflect perfectly the reality. In addition, the validity of the conclusions drawn from the questionnaires was assured by the fact that the information from the interviews was used when designing the questionnaires for the company. Thus, the questions asked were more relevant to the company. The external validity is related to the generalisability of the results from the research (Saunders et al., 2007). The fact that the goal of this paper is to investigate rebranding in only one company in one specific industry means that the findings and the conclusions will be applicable for this particular company. This paper will not provide conclusions which can be generalized for all companies that decide to rebrand. 27

35 4 Case Findings In this chapter the case of Vivacom will be presented. The results from the interviews and the documentation will be described in a logical way starting with background information, then discussing the new brand elements and after that describing the external and internal rebranding. At the end of the chapter, the results from the questionnaire will be presented. 4.1 Qualitative Data Results For the analysis of Vivacom`s case will be used a variety of documentation, which includes the corporate website, annual report, action plans for internal and external rebranding, and action plans for the campaigns. The interviews held were with the PR and Corporate Communications advisor and manager Adriyana Mihaylova and Simona Tcharaktchieva. The information gathered from the interviews will also be presented Background The Bulgarian Telecommunications Company (BTC) is a state owned company that traditionally operated in the fixed telephony sphere. It is also the biggest telecom company in Bulgaria. In 2004, 65% the BTC capital was sold to Viva Ventures Holding, which is a subsidiary of the private equity fund Advent International. The next year a public offering was made for the remaining shares on the Bulgarian Stock Exchange. It was also granted a license for third-generation mobile telecommunication systems and at the end of 2005 it launched the Vivatel brand which operated with mobile telephony. Meanwhile, there were other two competitors on the market MobilTel and Globul. With their launching, Vivatel contributed to a more competitive environment in Bulgaria (Corporate website, 2012). In 2007, 90% of the BTC capital was acquired by AIG Capital Partners, which is a subsidiary of AIG Investments. In 2009 as a consequence of the strategic vision of the new investor, BTC and Vivatel united under the new brand Vivacom and the whole company rebranded. The new brand combined all the positives of the BTC and Vivatel brands and Vivacom identifies itself today as a modern, open and client-oriented company offering superior quality (Corporate website, 2012). The next step that the company took was to gather all its employees which are in Sofia in one place. This they defined as the last step in the process of building the new brand and the rebranding. The whole number of employees in Vivacom is more than working in over 250 offices across the country. In 2010, Vivacom added to its portfolio of telephony services digital television (Corporate website, 2012) The New Brand BTC was the traditional state-owned telecom, which gained new negatives after its privatization because of corruption scandals. On the other hand, it was known for its reliability in the services and for its traditions, because it was the only telephone operator in Bulgaria for many years. Its subsidiary, Vivatel, created a positive image as a modern and innovative company. The merge of the BTC and Vivatel brands led to an integrated vision and identity. Vivacom combined the positive sides of both companies BTC`s traditions and reliability and Vivatel`s innovativeness and modernity (A. Mihaylova, personal communication, ). The company transformed itself from being traditional technical organization 28

36 to being entirely client-oriented modern telecommunication company. The new brand also united the employees of both companies into one team and created a portfolio of telecommunication services (Corporate website, 2012). The Vivacom brand is mainly associated with its core corporate values. As it states in its corporate website, the company`s aim is to provide better services for its customers through implementing these values internally and integrating them in its work. The corporate values are the following: Effective Innovative Inspiring Honest Dynamic The new brand name came with a new logo and slogan. Actually, BTC`s logo has changed during the years because the company wanted to be up to date (Corporate Website, 2012). The timeline of logo changes can be followed on Figure 4.1. Figure 4.1 Timeline of the logo changes of Vivacom (Corporate website, 2012). БТК is the abbreviation of BTC in Cyrillic. The slogan in Vivacom`s logo means Everything that connects us. Vivacom`s vision is to be the leader in delivering converged communication services in Bulgaria (Corporate Website, 2012), whereas its mission is to help our customers be successful in a competitive world by providing them with the best quality communication services (Corporate Website, 2012). The company is also involved in a large number of social responsibility campaigns via its Vivacom Fund. The fields of social responsibility that it operates on are education and health, culture, sport, caring for employees and other social campaigns (Corporate Website, 2012). It coordinates and harmonizes its decisions for the campaigns with its employees and tries to involve them in these activities (S. Tcharaktchieva, personal communication, ). 29

37 4.1.3 The Rebranding of Vivacom The decision for rebranding came with the change of ownership and the new CEO decided that BTC and Vivatel should unite under a new brand (A. Mihaylova, personal communication, ). It involved a complete change of the identity, vision and values. The company has also a new brand name, new logo and slogan (Corporate website, 2012; Action plan rebranding, 2009). The rebranding was publicly announced on 10 September, 2009 with a press conference with the CEO, the Chief Commercial Officer and the Secretary General. It was held in the National Archeological Museum, where the company made an exhibition with its archives and telephone machines and devices used in its past. The idea behind that exhibition was to show the public that Vivacom was the next step from the company`s development. The company made another event that day on one of the central streets in Sofia, the capital of Bulgaria. The street was closed for traffic and a dance and music performance was held in front of the Telephone Palace, which is a symbol of the telecommunications in Bulgaria and BTC in particular. At the same time was held a VIP cocktail with the most important stakeholders of Vivacom (A. Mihaylova, personal communication, ; Corporate website, 2012). The rebranding process included also rebranding of the corporate website, cars, stores, buildings, leaflets, posters and all materials which are used by the company and which contain its brand name and logo. An image TV advertisement was also launched in order to introduce the new brand (Action plan rebranding, 2009; Launch action plan, 2009) Vivacom`s Internal Rebranding The employees were informed the day before the public announcement of the rebranding. However, Vivacom launched a text message game with drawing fortune messages ten days before the public press conference. The game was announced in the in-company portal (Intranet). Each day the fortune messages were different but related to the new corporate values that had not yet been introduced (S. Tcharaktchieva, personal communication, ). Such an example was Today your inspiration will lead you to a great achievement which referred to the corporate value inspiring. The goal of launching this game was to attract the employees` attention that something was happening and to warm them up for the upcoming announcement of the rebranding. The only people that knew about the upcoming changes were the groups involved in the rebranding process. It was kept in secret as the managers did not want this information be spread publicly before the official launching (S. Tcharaktchieva, personal communication, ). The official internal announcement about the rebranding was made on 9 September, 2009 by the CEO (A. Mihaylova, personal communication, ). Further announcements and explanations of the changes, the development and the new mission, vision and values were made on the in-company portal and in the corporate s. Brand books with detailed explanation of the new values and examples from every function of the company were distributed to the employees. They also included information of how the employees were expected to follow these values. The internal newsletter E-motion also changed with the rebranding. E-motion allowed the employees to discuss and present their views about the new values. They also shared how they intended to apply these values in their everyday work (S. Tcharaktchieva, personal communication, ). A series of meetings with the employees in Sofia and other regions were held as part of the rebranding process. The in-company portal, which is usually very actively used, was also 30

38 part of the communication channels used for sending news about the rebranding (S. Tcharaktchieva, personal communication, ). The employee badges, templates, gifts and all other materials used from the employees were changed (Action plan rebranding, 2009). In order to emphasize further the not only the brand and the logo, but also the values, Vivacom fixed on the walls of the meeting rooms the five values made with designer letters to hang there (A. Mihaylova, personal communication, ). The company also created a network of opinion makers who helped them in the process of change and in the formation of internal messages (Launch action plan, 2009). One of the key campaigns that Vivacom launched internally for its employees is Vivastar The big 5. The campaign started in March 2010 and its goal was to popularize the new corporate values, to create positive attitudes towards them and to help the employees to understand the meaning of each value (A. Mihaylova, personal communication, ; Bright awards entry form, 2010). This campaign was so well accepted that it lasts until today. Every year since then the company organizes a new edition of The big 5 (A. Mihaylova, personal communication, ; Bright awards entry form 2010). For the goals of The Big 5 campaign the four generally accessible communication channels in the company were used posters in the offices, the in-company portal, official s and official mobile phones. The campaign initially started with a teaser one-week campaign with putting stickers on the floor and the office chairs. After that s were sent to each employee, posters were posted in the offices and banners appeared in the in-company portal (Bright awards entry form, 2010). The Big 5 campaign consists of three stages. The first one is nomination of employees by employees for the five categories corresponding to each corporate value: the most effective employee, the most inspiring employee, the most honest employee, the most innovative employee and the most dynamic employee. The nominations are made with voting with phone text messages. In the second stage the employees with the highest number of votes in each category are nominated for voting for the next stage. Short video spots are made to present the finalists, also. The last stage is awarding the winner and the four most distinctive participants. Each year the campaign has a different creative idea (A. Mihaylova, personal communication, ; Bright awards entry form 2010; Vivacom elections, 2011). For example in 2011 the campaign took place at the same time with the national presidential elections. That is why the second stage was made as an election with election studios and debates with moderators, where each nominee presented argumentation why he/she is the best candidate (Vivacom elections, 2011). All employees were very enthusiastic and participated very actively by voting and helping the nominees to make posters, T-shirts, etc. (A. Mihaylova, personal communication, ). In the 2010 campaign over 40% of the staff participated and in 2011 they reached almost 70%. This campaign made the employees think about the corporate values and try to identify themselves with them. Vivacom decided to use text messages (SMS) as a communication channel for the campaign, as according to Vivacom it is the most preferred channel by the staff (Bright awards entry form 2010; Vivacom elections, 2011). According to the interviewees, the staff liked the changes from the rebranding and more specifically, they liked the idea of working in a modern, dynamic and prosperous organization. The management was not worried of negative reactions, since the changes were in positive direction. In fact, there were a few employees that anticipated some changes and were curious about it before the internal launching of the rebranding. It indicated that people were interested and showed engagement with the organization. 31

39 4.2 Quantitative Data Results Before distributing the questionnaire a pilot-test was conducted. The employees who were interviewed were used in the pilot-test, since they were the ones that helped in the distribution of the questionnaires. Minor grammar mistakes were found, but as a whole they did not find any other errors or inaccuracies. This can be explained with the fact that the questionnaires were based on the interviews made. The intentions of the authors were to distribute the questionnaires to the largest number of employees possible. However, the researchers did not manage to arrange such distribution, since the decision was made on a higher managerial level, which did not allow this. The management agreed to distribute the questionnaire among a small number of employees. Therefore, the respondents reached were only 35, which limits the generalizations that can be made on the results from this small-sized sampling. Moreover, two of the respondents were filtered out with the first question, because they became employees of Vivacom after the rebranding. Another two respondents were deleted from the sample since they had unusual and inconsistent answers, which made the authors believe that these employees did not fill in the questionnaire properly or conscientiously. Therefore, the number of respondents that will be analyzed is 31. Since the number of employees in Vivacom is almost 3500, the response rate is rather small. However, it should be noted that the number of employees that have worked at the time of the rebranding in 2009 and still work in Vivacom is unknown Reliability In order to measure the attitudes and opinions of Vivacom`s employees Likert scale was used. Each category is related to the conceptual framework that the authors described in Chapter 2. Furthermore, each category consists of several items. The categories and the corresponding items are presented in Table 4.1. After reversing the coding for the negative statements, the summated items were created by calculating the average value for each category. Each summated item was tested for internal consistency with the Cronbach`s alpha coefficient. Ideally, the coefficient`s value should be above 0.70 in order to have internal consistency (Malhotra, 2004). However, since it is very sensitive to the number of items, it is common for scales with fewer than ten items to have a Cronbach`s alpha value of 0.50 (Pallant, 2005). All scales in this paper consist of fewer than ten items, which is why the authors of this thesis will consider a Cronbach`s alpha value of 0.50 or above as an indicator for internal consistency, but a coefficient under 0.70 will be considered with a limited internal consistency. After testing for internal consistency, three of the summated items had Cronbach`s alpha of less than 0.50, which is why items from each of them were removed by using the Cronbach`s alpha if Item Deleted. Thus these three summated items reached coefficients of 0.60 and above. The deleted items in these three summated scales are presented with a strikethrough in Table 4.1. The final Cronbach`s alpha values for each summated item are also presented in Table 4.1. The summated items that have ideal internal consistency are Employee`s positive evaluation of Vivacom`s vision (0.941), Positive evaluation of the messages sent regarding the rebranding (0.735), Positive evaluation of the changes after the rebranding (0.716) and Absence of employee resistance (0.734). The rest of the scales have values above

40 Employee`s positive evaluation of Vivacom`s vision al- Cronbach`s pha=0,613 al- Cronbach`s pha=0,941 Employee`s positive evaluation of the corporate values Employee`s perceived image for Vivacom Positive attitude for the channels used during the rebranding process al- Cronbach`s pha=0,611 al- Cronbach`s pha=0,669 Effectiveness of the various communication strategies implemented during the rebranding process Cronbach`s alpha=0,505 Positive evaluation of the changes after the rebranding Absence of employee resistance al- Cronbach`s pha=0,734 Positive evaluation of the messages sent regarding the rebranding al- Cronbach`s pha=0,735 al- Cronbach`s pha=0,716 Employees are aware of the vision Employees understand the values Vivacom aims to be a leader The media channels were appropriate The game made the employees curious The messages were clear Fair treatment Absence of confusion regarding the expected changes from the rebranding Clearness of the vision The employee were well-informed about the values The values pertain to Vivacom Employees approve the channels that were most intensively used The Big 5 was useful for understanding the values The messages were well coordinated Value their qualities Approval of the changes The employees were wellinformed about the vision The values are important Vivacom acts according to its values The channels were used appropriately The brand books were useful for understanding the values The messages were sufficient Opportunities development for Everyday work stayed the same Employee`s Support for the vision The vision is achievable The values are appropriate for Vivacom Vivacom`s values coincide with the employees convictions Vivacom traditions has Vivacom is a modern company The channels enabled a two-way communication E-motion enabled a two-way communication The messages were easily accessible The messages were consistent Salary Benefits Level of responsibility Stress level Work duties Working hours The rebranding was well organized The new way of working is better Table 4.1 Summated items and their Cronbach`s alpha coefficients. The items with strikethroughs are excluded from the summated items. 33

41 4.2.2 Respondents The respondents were not very diverse as a whole. The majority of them were women (77.42%) (see Figure 4.2) and 54.8% of the respondents were between 30 and 39 years old (See Figure 4.2). The largest number of respondents is workers (61.29%) and a smaller number is on a higher hierarchy level in the company (see Figure 4.3). This classification of the hierarchy was derived from the classification that the most popular Bulgarian website ( for job search uses. Gender Age 3% 23% Female 16% % Male 55% 26% Figure 4.2 Gender and age of the respondents. The length of service in Vivacom was calculated as the difference between the current year (2012) and the year stated as a starting one in Vivacom. The authors decided to use the current year for this calculation and not 2009, because the responses are from the point of view that the employees have currently, since they filled in the questionnaire this year. This means that even though the authors ask in past tense in some of the questions, the employees may not remember their views and opinions at the moment of rebranding. Furthermore, the length of service was collapsed into 3 groups by using SPSS. The largest number of employees (54.84%) has a length of service of less than 5 years (see Figure 4.3). It is interesting to note that 4 of the respondents started work in Vivacom during the same year when the rebranding took place. 34

42 % Hierarchical level Lenght of service 10% 6% 23% 61% Workers Experts / Specialists Supervisors / Team leaders Management 29% 16% 55% Less than 5 years of service Between 6 and 7 years of service More than 8 years of service Figure 4.3 Hierarchical level and length of service of the respondents Descriptive Statistics Employees` Evaluation of the Sources of Messages and the Messages Question 7 (see Appendix 8) from the questionnaire shows where the employees got informed for the rebranding at first from (see Figure 4.4). The largest percentage of the employees (38.71%) was informed firstly on an official meeting. News in the Intranet (16.13%) and colleague (16.13%) are the next group of choice. Other 12.90% of the employees do not remember where they got the information about the rebranding from. The options that have not been chosen by the respondents are media, corporate magazine, trainings and a friend. One of the respondents made it clear in the open box in the option other that he/she learned about the rebranding from a supervisor Used to announce the rebranding Intensively used Preffered for intensive usage Figure 4.4 Sources of messages. 35

43 Question 8 (see Appendix 8) from the questionnaire gives information about which sources were most intensively used for communicating the rebranding. According to the responses given, most intensively were used news in the Intranet (48.39%) and meetings (29.03%) (see Figure 4.4). Question 9 shows which the preferred sources of intensive information by the respondents are (see Figure 4.4). The most preferred sources of information are news in the Intranet (46.70%) and meetings (33.30%). Table 4.2 Descriptive statistics for the evaluation of the channels used during the rebranding. Statements Mean Standard Deviation 1. I received information about the rebranding in the appropriate media channels. 2. I would not prefer to have received this information from other media than the used ones. 3. The company has used the communication channels appropriately. 4. The communication channels allowed the two- way communication between the organization and the employees Summated Item (items 2 and 4 are not included ) The channels used during the rebranding for sending messages regarding it, have an average evaluation, with a mean of 4.16 according to the responses from the employees (see Table 4.2). As a whole it is positively evaluated in terms of appropriate channels used in an appropriate way. However, the respondents rated the opportunity for a two-way communication with a mean of 3.45 and with variety of the opinions, which is evident due to the high standard deviation of Table 4.3 Descriptive statistics for the evaluation of the effectiveness of the various communication strategies implemented during the rebranding. Statements Mean Standard Deviation 1. The game with fortune messages, executed several days before the official rebranding, provoked my curiosity. 2. I found the campaign The Big 5 really helpful for the adoption of the new core values of the company. 3. The distributed brand books, containing an explanation of each of the new core values helped me to better understand these values. 4. The internal newsletter E-motion allowed a discussion between the employees and the organization about the new values Summated Item

44 Furthermore, the respondents were asked to evaluate specifically four sources of information which are The Big 5 campaign, the brand books, the game before the launching of the new brand and the newsletter E-motion. These statements were used only to evaluate the effectiveness of the separate communication strategies, and were not included as items of the overall evaluation of the channels. The overall impression is that these strategies did not achieve their goals thoroughly (see Table 4.3). Their means are between 3.29 and 3.87, whereas the standard deviations are high. The only exception is The Big 5 campaign which seems to have helped the employees to understand the new corporate values. This is concluded from the mean score of 4.35 and standard deviation of The respondents did not rate very highly the opportunities for two-way communication which can be considered a drawback of the internal communication strategy during the rebranding. This item was excluded from the summated item, but is important even as a separate statement for evaluating the interaction between the management and the employees. Table 4.4 Descriptive statistics for the evaluation of the messages sent regarding the rebranding. Statements Mean Standard Deviation 1. The information received about the rebranding was clear The information received about the rebranding was well coordinated I did not need more information about the rebranding The information received about the rebranding was easily accessible. 5. The information received about the rebranding was consistent Summated Item The messages which were sent to inform the employees about the rebranding have also average score for the mean with its 3.90 (see Table 4.4). The opinions seem to be similar across the different respondents as the standard deviation is low with The evaluation of the messages includes investigating the opinions of the respondents regarding the clearness of the information, its accessibility, consistency and sufficiency, as well as if it was well-coordinated. The scores of the separate items are not very high raging from 3.26 to The conclusion is that the information was clear and easily accessible, but was not sufficient, consistent and coordinated enough. 37

45 Employees` Evaluation of the Changes After the Rebranding Table 4.5 Descriptive statistics for the evaluation of the changes after the rebranding. Statements Mean Standard Deviation 1. Fair treatment Value my personal qualities Opportunities for development Salary Benefits received Level of responsibility Stress levels Work duties Working hours Summated Item (item 8 is not included) The respondents were asked to evaluate in what direction their work changed after the rebranding. The opinions are very similar across the respondents with lowest standard deviation of 0.39 among the summated items (see Table 4.5). According to the respondents almost no changes occurred after the rebranding in the different aspects of work. The mean of the summated item is 3.37, which means no change or a slight change in positive direction. The results show that according to the respondents the opportunities for development and the responsibility level improved, whereas the work duties changed in a negative direction, which can be interpreted as an increase in the work duties. Work duties were excluded from the summated item for the changes after the rebranding since it lowered the Cronbach`s alpha. The stress level shows no change with its mean of The other aspects of work such as fair treatment, valuing the employees` qualities, the salaries, benefits and length of the work day slightly changed in a positive direction. 38

46 Employee Resistance Table 4.6 Descriptive statistics for the level of employee resistance. Statements Mean Standard Deviation 1. I was not confused about what changes would come up in my work as a consequence from the rebranding I like the changes resulting from the rebranding My everyday work did not change a lot after the rebranding The process of rebranding was well organized I do not prefer the old way of working in the organization before the rebranding Summated Item The last set of statements aimed to measure the employee resistance. The mean of the summated item is 3.86 which is and average score in a positive direction indicating absence of severe employee resistance (see Table 4.6). As a whole the respondents varied in their opinions, which is evident from the high standard deviation of 0.71 for the summated item and above 1.00 for some of the items constructing it. The respondents were not too confused what changes would occur after the rebranding (mean score of 3.97). They also stated that they did not dislike the changes (mean score of 4.03). The everyday work did not change too much (mean score of 3.55) and the new way of work is a bit better (mean score of 3.87). The respondents also have relatively positive attitude towards the organization of the rebranding (mean score of 3.90) Employees` Evaluation of Vivacom`s Vision, Values and Image Table 4.7 Descriptive statistics for the evaluation of the vision. Statements Mean Standard Deviation 1. I am aware of the new vision of Vivacom I understand the new vision of Vivacom I received enough information about the new vision of Vivacom I support the new vision of Vivacom I find the vision of Vivacom achievable Summated Item The evaluation of Vivacom`s vision is relatively good. The mean score for the summated item is 4.52, which means that the respondents agree with the facts that the vision is clear and achievable (see Table 4.7). The respondents also stated that they are aware of the vision, which could be related to the positive responses for being well-informed about it. 39

47 Moreover, the respondents tend to support the new vision. All these items have relatively high means of 4.50 and above, except for the item, measuring the sufficiency of the information about this vision as it has 4.29 score mean. The standard deviations are relatively high, ranging from 0.81 to 0.94, which indicates the variety of opinions among the respondents. Questions 3 and 4 from the questionnaire aimed to show if the employees know how many the new corporate values are and which they are. Both questions were separated on the screen with a page break so that the respondents could answer question 3 without being influenced by the alternatives in question 4. Values Responses % Creative Upright Positive Dynamic Honest Inspiring Innovative Effective 3,2 3,2 3,2 96,8 96,8 96, Figure 4.11 Values 90.3% of the employees chose the right number of values, which is 5. Vivacom`s five corporate values are inspiring, effective, honest, dynamic and innovative. Among them only innovative and effective were chosen by all respondents, whereas the other three corporate values were omitted by some respondents (see Figure 4.11). The people who said that the number of values is 3 or 4 also selected the same number of values in question 4. Therefore, consistency in the answers is observed. The only exception are a respondent who answered correctly on question 3, but chose 3 more values in question 4, and a respondent who answered that the number of values is 6, but then recognized all 5 values correctly. Creative may be perceived with close meaning with innovative, whereas upright may be confused with honest. These particular respondents may have not understood completely the essence of the question. As a whole, 28 (90%) of the respondents recognized correctly all 5 values. 40

48 Table 4.8 Descriptive statistics for the evaluation of the values. Statements Mean Standard Deviation 1. I understand the meaning of the new corporate values I think that the information I received about the new corporate values is enough. 3. I think that new corporate values are of great importance for my everyday work The new corporate values are appropriate for Vivacom I think that the corporate values also reflect my personal convictions Summated Item (items 3 and 5 are not included) As for the overall evaluation of the values, it could be concluded that not only the employees are well-aware of the new corporate values, but they also seem to give positive responses when evaluating the values (see Table 4.8). The mean score of the summated item is 4.01, which means that the employees do not completely agree with the statements that the values are appropriate for the company, that they also were well-informed about them and that they understand the values completely. The standard deviation of the summated item is relatively high, which with its 0.90 is the highest one among all summated items. Furthermore, the responses for the different items are ranging, whereas the statement that the values are appropriate for Vivacom tends to be highly supported by the respondents with its mean of 4.48 and low standard deviation of Table 4.9 Descriptive statistics for the evaluation of the image. Statements Mean Standard Deviation 1. Vivacom aims to be a leader in the telecommunication services in Bulgaria. 2. The new five corporate values really pertain to the company. 3. The actions of Vivacom are compatible with the defined vision and corporate values Vivacom is a modern company Vivacom is a company with traditions Summated Item

49 On the other hand, the evaluation of images is not only very positive with its mean of 4.44, but it is also with a low standard deviation of 0.38, making the responses very similar (see Table 4.9). The respondents believe that Vivacom is really aiming to be a leader and that Vivacom is a modern company with traditions, which is how the management wanted to be perceived. The means of these statements are between 4.45 and 4.77 having relatively low standard deviations of 0.43 and However, the respondents do not completely agree that Vivacom really follows these values and acts in accordance with them, as the means are relatively lower compared to the means of the other items Hypotheses Testing In order to answer the three questions related to correlation between the continuous variables, hypotheses were formulated (see Section ) and then tested. The null hypotheses represent no existence of correlation, whereas the alternative hypotheses represent the existence of correlation between the variables. The items in each category were grouped in summated items for the purpose of the analysis. The tests for normality of the continuous variables (see Appendix 3) showed that the responses for employees` image of Vivacom (as measured by the avg of images) is normally distributed (Sig. =0.066). However, the responses for evaluation of the messages sent during the rebranding (Sig. = 0.014) (as measured by the avg of messages), the responses for evaluation of channels used (Sig. = 0.000) (as measured by the avg3 of channels) and the responses for evaluation of the changes after the rebranding (Sig. = 0.025) (as measured by the avg2 of pcontract) are not normally distributed. Therefore, non-parametric statistics was conducted. The scatter plots for these variables show linearity in the relationship between employees` image and evaluation of channels (see Appendix 4), and also linearity in the relationship between employees` image and evaluation of messages (see Appendix 4). However, there is no visual proof for linearity in the relationship between employees` image and the evaluation of the changes after the rebranding (see Appendix 4). a) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the channels used during the rebranding? The null hypothesis is that there is no relationship between the employees` image of Vivacom and the scores of evaluation of the channels used during the rebranding, whereas the alternative hypothesis is that there is some relationship between them. H 0 : ρ=0 H 1 : ρ 0 The relationship between employees` image of Vivacom (as measured by the avg of images) and evaluation of the channels used during the rebranding (as measured by avg3 of channels) was investigated using Spearman`s Rank Order Correlation coefficient (rho). High levels of employee image evaluation did not correlate significantly with high levels of positive evaluation of the channels used during the rebranding process [r=.33, n=31, p=.067], thus not rejecting the null hypothesis (see Appendix 5). The calculated coefficient of determination is 11.09%, which means that the positive evaluation of the channels would explain only 11.10% of the variance in respondents` scores on the employees` image of Vivacom. The reasoning behind that is if the company had used the channels that the employees evaluate positively that would not have significant effect on creating the image 42

50 of Vivacom in their minds. However, the direction of such relationship would be positive, which means that negatively evaluated channels would not lead to a better image in the employees` minds. Moreover, the source of messages may not be the main reason for image building. It should also be noted that it is not clear which is the cause and which is the effect. A good image in the employees` minds now may lead to positive evaluation of the channels used at the time of the rebranding. Nevertheless, the test statistics shows no significance in such correlation, which means no relationship between the two variables exists. b) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the messages sent regarding the rebranding? The null hypothesis is that there is no relationship between the employees` image of Vivacom and the scores of evaluation of the messages sent regarding the rebranding, whereas the alternative hypothesis is that there is some relationship between them. H 0 : ρ=0 H 1 : ρ 0 The relationship between employees` image of Vivacom (as measured by the avg of images) and evaluation of the messages sent regarding the rebranding (as measured by avg of messages) was investigated using Spearman`s Rank Order Correlation coefficient (rho). There was a medium, positive correlation between the two variables [r=.39, n=31, p=.028], with high levels of employee image evaluation associated with high levels of positive evaluation of the messages sent regarding the rebranding process (see Appendix 5). Therefore, the null hypothesis is rejected and the alternative hypothesis is accepted. The calculated coefficient of determination is 15.52%, which means that the positive evaluation of the messages helps to explain 15.52% of the variance in respondents` scores on the employees` image of Vivacom. This means that the positive evaluation of the messages may have had some effect on creating the image of Vivacom in the employees` minds. It is also possible that these two variables have some correlation thanks to a third factor. c) Is there a relationship between employees` image of Vivacom and the scores of evaluation of the changes after the rebranding? The null hypothesis is that there is no relationship between the employees` image of Vivacom and the scores of evaluation of the changes after the rebranding, whereas the alternative hypothesis is that there is some relationship between them. H 0 : ρ=0 H 1 : ρ 0 The relationship between employees` image of Vivacom (as measured by the avg of images) and evaluation of the changes after the rebranding (as measured by avg2 of pcontract) was investigated using Spearman`s Rank Order Correlation coefficient (rho). High levels of employee image evaluation did not correlate significantly with high levels of positive evaluation of the changes after the rebranding process [r=.14, n=31, p=.442]. Thus, the null hypothesis is not rejected (see Appendix 5). The calculated coefficient of determination is 2.04%, which means that the positive evaluation of the changes would explain only 2.04% of the variance in respondents` scores on the employees` image of Vivacom. There is no association between the positively evaluated changes after the rebranding and the created images of Vivacom whatsoever. 43

51 5 Discussion In this chapter an analysis of the empirical data collected from the interviews and the questionnaire will be conducted. It will be evaluated on the basis of the conceptual framework created especially for the purpose of the thesis and presented in the third chapter. The outline of the analysis of the interviews and of the questionnaire will be constructed after the layout of the conceptual framework (see Figure 5.1), starting with the brand decisions, corporate image, vision and values, continuing with the internal communication strategy, source of messages and messages, psychological contract, employee desired image and employee resistance. Moreover the analysis will answer the research questions of this thesis. 1. New Brand Decision 2. Corporate branding: Vision, culture, image 3. Internal communication strategy 4. Sources of messages and messages: Formal internal communication 5 Interpretations : Psychological contract 6. Perceptions: Employee brand image Figure 5.1 Conceptual framework of employee rebranding process. 5.1 New Brand Decision It can be said that the decisions of the management in the rebranding process comprise firstly the reasons behind the changes and secondly what these changes consist more specifically of. Consequently the reason for the company to rebrand is related to a lot of brand decisions about which brand elements should remain in the brand or which ones should be removed from it. In this relation and in following the explanation of corporate rebranding, presented by Lambkin and Muzellec (2008), the rebranding processes in Vivacom can be defined to be executed on a corporate level in the organizations, because it targets not only the company`s customers but also the other stakeholders of Vivacom. The rebranded drivers in the case of the Bulgarian telecom Vivacom can be differentiated according to the concept of rebranding reason, presented by Goi and Goi (2001), as external and internal drivers. 44

52 The main rebranding driver in the case of Vivacom is the change of ownership and the decision of the new CEO to unite BTC and its subsidiary Vivatel under the brand of Vivacom. The new owner of BTC took decision after its last sale. With the change of the ownership was made that decision. (A. Mihaylova, personal communication, ) The reason behind the rebranding is to build synergy in combining the operations of the traditional Bulgarian company for fixed telephony (BTC) and the operations of its modern subsidiary for mobile telephony (Vivatel). This rebranding allows to the company to elaborate a mix with the best features of the two brands. Thus it serves as a tool for overcoming the BTC`s contradictive image carried from the organization after its privatization in 2004 and distinguished by the authors of the thesis as a part of the internal triggers for rebranding the company in Moreover it can be said that the brand of the company definitely needed to be refreshed and looked from different angle. The BTC`s image even after its privatization stayed a little old and outdated in the way people see the company. Thus the freshness that the decision to merger with the BTC`s subsidiary brings into the unified brand of Vivacom, is welcomed by the public and by the employees in the company. The decision related to the new modern and dynamic look of the brand is expected to be accepted positively by the employees in the organization. That is because it is assumed that every worker would prefer to work in a modern organization rather than in an outdated one. However the new brand can provide not only the modernity and youthfulness to those who preferred it but it can also offer the traditional and full of heritage view point to its employees. Furthermore the decision for the rebranding of the two brands into Vivacom gave the possibility of the company to differentiate itself among the competitors in the sector. As Vivatel is identified to be the third appeared mobile operator on the Bulgarian market of mobile services, it was important for the company to have not only the innovative look but also other strong competitive advantages in order to be able to gain positions on the Bulgarian market. Therefore the decision to merger and to unify the two brands, BTC and Vivatel, turned the company into the largest telecommunication company in the country, providing a diversity of telecommunication services. Thus the need for differentiation from the competitors and the gaining of new positions in the market environment play the role of external rebranded drivers in the case of Vivacom. However the identification of the rebranded drivers in Vivacom`s study case as well as their explanation are important and strongly related to the management decisions about which brand elements have to be removed and which brand elements have to stay after the rebranding. The change occurred in the company, as a result from the decision to rebrand, can be categorized as revolutionary change because it involved a complete change of name, logo, identity, vision and values of the organization. In other words, following the explanation of the new brand decision, explained by Daly and Moloney (2004), the rebranding of the Bulgarian operator to Vivacom included an almost complete removal of the existing brand elements and their replacement with new ones. Thus a description of the new corporate brand of Vivacom will be explained in the next section of the present chapter. 5.2 Corporate Branding According to the framework of Hatch and Shultz (2003), the corporate branding includes the corporate image, the vision and the culture of the company. In the context of Vivacom the features related to the corporate branding that has to be analyzed in the paper comprise 45

53 the company`s new vision, identity and image as well as the newly introduced corporate brand values of the organization. Their clear description and analysis are stated to be a part from the management`s decisions in the rebranding process and are defined to be a significant ingredient in the main communicated message in employee rebranding process Vision In the process of rebranding a change of the vision of the company took place. The different strategic investors have different visions for development of the company. The previous investor had the vision that there should be two separate companies. One of them served the fixed telephony and the other one served the mobile telephony. But the new investor had different view. That is why it was decided that both companies should merge and it is necessary to rebrand. (A. Mihaylova, personal communication, ) As a result from the change of ownership the rebranding decision was made and the new vision of Vivacom was introduced. This new company` vision to be the leader in delivering converged communication services in Bulgaria can be deciphered as the symbol of the diversity of telecommunication services that the company is able to offer after the merger of BTC and Vivatel. As stated from Hatch and Schultz (2003) when new goals for the company are settled and a new vision is introduced it is really important for the management to ensure their link with the heritage of the company in order not to lose credibility in the eyes of the stakeholders. In the case of Vivacom BTC is a company with a great heritage in the telecommunication industry in Bulgaria and is considered with a great importance and weight in the development of this market. Having that in mind when examining the management practices in Vivacom it can be said that the company has successfully bound in its vision the traditional flavor of BTC with the modern outlook of Vivacom. The results from the questionnaire have shown that most of the people understand and support the new vision of Vivacom. It is evaluated to be successful because the new vision emphasizes the diversity of telecommunication services intended to be offered from the rebranded company without rejecting the traditions that BTC brings in the brand. Moreover the new vision conveys the strength of the brand and emphasizes the direction in which the company intent to develop in Image As discussed above one of the triggers that have pushed the management to the decision to rebrand is the desire of the company to have a good image. Once BTC and Vivatel are united, their image affect to one another and the outcome of this interaction has to be carefully examined and predicted by the management in order for them to be informed whether the rebranding will be a successful practice for the company or not. The contradictive image of BTC, mentioned before in the paper, expresses the negative association with corruption scandals and speculations the stakeholders had towards the company after its privatization and at the same time the positive image it carried as the reliable in its services for fixed telephony traditional Bulgarian telecom. On the other hand the subsidiary of BTC, Vivatel is explained in the interview with the corporate projects and event management adviser of Vivacom Adryana Mihaylova to have the image of the most modern and youthful mobile operator on the Bulgarian market. Thus the management decision to rebrand the company had for purpose to eliminate the negative reputation of the parent company and to retain all the positive trait of both the parent and the daughter organizations. An important accent is the fact that almost each Bulgarian family had used the services of the stateowned company for fixed telephony, BTC. Therefore it can be said that the management 46

54 wants to reinforce in the image of Vivacom the sense of trust and security towards the company which have been built by BTC during a lot of years. The trustworthiness of BTC and the modern vision of Vivatel represent the brand promises that Vivacom gives to its stakeholders and explain the way Vivacom wants to be perceived by the others. In other words these brand promises along with the new corporate values compliment the identity that Vivacom wants to have as an outcome of the rebranding. In order to fulfill its brand promises and to project successfully the desired image to its stakeholders, Vivacom`s management introduces to its employees several new corporate values that has to be understand and adopted by them Corporate Values The new corporate values of Vivacom comprise the following five adjectives: effective, innovative, inspiring, honest and dynamic. The idea of these values is to give guidance to the Vivacom`s employees about how they have to behave in the organization after the rebranding of the company. Actually it can be said that these values express the requirements of the organization towards its employees as a part of the psychological contract established between these two parties. The successful projection of the desired by the Vivacom`s management image depends on how accurate the employees have acquired the new values, vision and identity. According to the results from the questionnaire, 90% of the employees have recognized correctly the five values of the organization, which means that the management has successfully communicated them to their employees. The consistency as mentioned before in the paper is a really important issue that has to be covered in the management decisions related to the rebranding. The new values have to be stated in a way they can follow the vision of Vivacom and can contribute to the establishment of the new identity. This interconnectedness among the brand elements can be referred to the framework of corporate branding of Hatch and Shultz (2003), discussed in chapter 2 of this paper and also present in the adapted by the authors of this thesis conceptual framework of employee rebranding process. Thus in order to insure the proper flow of the employee rebranding process as well as the positive outcomes from it the management of Vivacom develops an internal communication strategy. The main internal message related to the rebranding of Vivacom consists of the new vision, values and identity of the organization. Thus the way the internal communication strategy suggests to communicate the main message internally in the company is further explained in the next heather. It will represent the third step from the employee rebranding process and will tend to answer the second research question of the thesis. 5.3 Internal Communication Strategy The management of Vivacom used a combination of different tools to communicate the message about rebranding to its employees. The internal communication plan set by the organization included training, games, communication campaigns and presentations. According to the information collected from the conducted interviews a clear structure and time-plan of the internal communication approach can be identified in the case of Vivacom. The main focus of the internal communication strategy implemented by the management of Vivacom was on the clear explanation of the new corporate values for the company as well as its new vision. Therefore most of the initiatives described from the interviewee actually involved the five values - effective, innovative, inspiring, honest and dynamic. Along with the analysis of the communication tools used by the management in the em- 47

55 ployee rebranding process, a description of the used internal communication channels also will be presented. According to the model of Quirke (2008) the successful communication and implementation of the organizational change depends not only on the planning of the management but also on how inspirationally the company`s leaders present the rebranding goals to their colleagues. Therefore in order to assure the communication of the correct message, the people involved early in the rebranding process were trained about what changes are related to the decision to rebrand the company. Thus these employees will be able to transfer the right message further in the organization after of course the official internal launching of the rebranding. Moreover the organized game with drawing fortune messages on the Vivacom`s Intranet portal can be identified as the first initiative of the Vivacom`s management in communicating the message to the employees on the lowest level in the organization. Moreover the decision to launch this game approximately ten days before the official internal announcement of the rebranding intended to provoke the curiosity of the employees towards the new corporate values of Vivacom, present in the text of the fortune messages. In addition it can be emphasized that the game served as a tool for overcoming the possible employee resistance to the changes related to the rebranding because it has notified the employees that some change in the company would occur. The intranet as one of the communication channel of the game allowed the spread of this activity to all the employees of the organization whereas the actual game included the use of employee`s mobile phones. In other words the choice of the management to use the mobile network of Vivacom in combination with the company`s Intranet for spreading the game wanted to show the ability of the telecommunication company to communicate through different channels. Moreover it emphasized the quality of the provided communication. Furthermore the next step in the plan for communicating internally the message of rebranding included the official announcement of the rebranding of the company one day before the public launching. In the CEO`s presentation the reason behind the change is explained and the changes due to the rebranding are introduced. The face-to-face communication area, presented in the model of Quirke (2008) is also broadly used from the management of Vivacom because the interaction on the regional presentations and meetings before and after the public launching of the rebranding was realized face-to-face. The decision of the management to use direct interaction when announcing the rebranding can be understood as a way to avoid the possible employee resistance to the change in the company, because face-to-face communication is proven to soften the reaction to the employees. The fact that the 33.30% of the employees preferred to be informed about the rebranding trough meetings confirm the importance of face-to-face interaction used by the management of Vivacom. Moreover the message communicated to the employees on these meetings consisted of one and the same components- the reason for rebranding, the new vision, values and identity of Vivacom. The similarity of the message can be explained by the desire of the Vivacom`s management to be consistent in the message they communicate in order for the employees to understand and perceive correctly the occurred changes in the company. Moreover the internal newsletter, named E-motion on the company`s intranet webpage is another components of the internal communication strategy of Vivacom that has provided the employee with up-to-date information about the rebranding process within the company. Its idea is to represent a place for discussion between the company and its em- 48

56 ployees about the changes in the company and thus to allow the realization of two-way communication in the employee rebranding process. No matter how diverse and interesting communication tools the management have decided to use in its communication strategy, the Intranet can be distinguished as the channel the most broadly used by the management for communicating the messages about the rebranding which is also confirmed by 48.39% of the employees. Moreover it is also evaluated to be the most preferred by 46.70% of the employees channel for intensive communication of the rebranding process. Thus it can be said that the management decision about this communication channel was successful and it has fulfilled its purpose. The intranet portal is used in the game with the fortune messages, in communication of the company`s newsletter E-motion, as well as in the other initiatives related to the rebranding. The choice of the management to use mainly one communication channel can be explained by the aim of the company to avoid overload of the channels, through which the rebranding message is communicated. Moreover this decision corresponds to the channel management area of communication, explained in the model of Quirke (2008). Another component that can be identified in the internal communication strategy of Vivacom is the distribution to every employee in the company of a book with five separators corresponding of the new corporate values of the organization. The book contained not only the name of these values but also a detailed explanation about their meaning. Thus the employees can understand what behavior is expected from them and in what direction the company is going. Additionally it can be said that the distribution of these books aimed to provide guidance of each employee in the rebranding journey and allows the immediate consultation from her/his part if needed. Moreover the special Vivacom`s initiatives related to the employee rebranding process can be distinguished with its originality and expected high functionality. Such initiative includes the internal campaign The Big 5 organized after the public announcement and already explained in the paper. The idea of the management behind the campaign i.e. to help the employees to adopt the new values seems to be realized successfully as the results from the questionnaire have proven that through The Big 5 the employees understood better the new values. In addition the campaign assures the consistency of the communicated message for the long run, because it continues to be organized each year after the rebranding in 2009 and thus the values is expected to be remembered easily by the employees. 5.4 Sources of Messages and Messages from Employee`s Perspective From employees` perspective the internal communication strategy looks a bit differently. The overall evaluation from the respondents shows that the sources of information were to some extent appropriate and used appropriately. However, the results showed that the chosen communication channels and tools did not enable completely a two-way communication. The two-way communication strengthens the feeling of belonging and leads to involvement in the process of branding and in this case in the process of rebranding. Moreover, the respondents showed preferences for particular channels. The main tools used by Vivacom as part of the internal communication strategy, the game with the fortune messages before the launching, The Big 5 campaign, the newsletter E-motion and the brand books seem to not have achieved completely the intentions of the management. The campaign did help for understanding the new values, but the game was not so successful to arouse interest and curiosity. The newsletter E-motion did not enable completely a two- 49

57 way communication between the employees and the management. The brand books helped for understanding the new values only to some extent. As a whole the respondents were informed about the rebranding from a variety of sources. The official meetings that the management made were the intended main source of information about the decision of rebranding, which coincides with the responses. However, other sources such as news in the Intranet and corporate are also considered as a main source of information about the rebranding. It can also be explained with the fact that the company did not tell all its employees in Bulgaria at the same time. Some of them were working in the stores or the call centers during the official meetings. Some of the employees learned about the rebranding from their colleagues, which refers to the informal type of internal communication. According to Miles and Mangold (2004) the coworkers also have influence over the desired image, which is why it cannot be denied that the information from the colleagues has not influenced the first impressions of the new brand. Furthermore, the results from the questionnaire indicate that external communication did not influence the internal official announcement of the rebranding, since none of the respondents learned about it from the media or from a friend outside the company. During the rebranding Vivacom launched different external messages in different forms which coincided with the ones targeted for the internal customer i.e. the employee. This could be one of the reasons for not having too much confusion among the employees as the results from the questionnaires indicate. The management`s intentions to keep the rebranding a secret until the 9 th of September were successful. Some of the respondents did not remember where they got the information about the rebranding from, which can be explained with the fact that the rebranding took place 3 years ago. It seems that the company has used the sources of information about the rebranding which the employees prefer. The results also show that the employees prefer to have been informed more with meetings, which has not been done by the management so intensively, according to the respondents. This leads us back to the necessity for two-way communication and face-to-face contact. Quirke (2008) emphasizes the importance of face-to-face communication as it helps to better explain the reasons for the changes and the changes themselves. According to Green et al. (2004), the most important characteristics of a message for a successful employee branding is its clarity and consistency. The messages also form the first impressions and expectations about the company. During a rebranding a lot of aspects in a company change, therefore the messages during the rebranding also need to be clear and consistent in order to successfully rebrand the employees. If the messages and the information achieve their goals, the employees will be able to successfully project the intended by the management image towards the customers. In the case of Vivacom, the overall opinion of the respondents is that the messages sent during the rebranding process in order to inform them about its essence were to some extent clear and easily accessible, but were not so consistent, sufficient, and well-coordinated. Vivacom seems to have followed the steps for internal communication which Quirke (2008) described, but questionnaire results lead the authors to think that the communication strategy may have been managed better, especially in terms of two-way communication and consistency in the messages. 5.5 Psychological Contract As already mentioned, the internal communication strategy affects the perceptions of the employees for the company and the expectations they create (Miles & Mangold, 2004). With the changes that occur with a rebranding, the employees may change their expecta- 50

58 tions for different aspects of their work and work environment. The existence of such changes was investigated through the questionnaires by asking the respondents to evaluate the direction of changes of different aspects of their work after the rebranding. The results showed that the respondents do not feel that significant changes have occurred. Their overall evaluation is that there were slightly positive changes. It can be concluded that the employees have adopted a certain behavior as a result from the rebranding, such as pursuing the new organizational goals based on the new vision, or learning the new organizational culture, and more specifically the new five values. Furthermore, the employees expect to be treated in accordance with the adopted behavior. However, since the respondents do not identify major changes, it can be inferred that the psychological contract was not broken. 5.6 Employee Brand Image After having communicated the new organizational and brand decisions through the variety of internal communication channels and tools, and after the psychological contract has been fairly established, the employees adopt the new brand together with its components vision, values and image (Miles & Mangold, 2004). The questionnaires aimed to evaluate to what extent the desired by the management brand image was projected successfully in the employees` minds. The results showed good knowledge and understanding of the new vision. It was positively evaluated by the respondents. The corporate values were also well known and identified. The respondents tend to believe that the values are appropriate for Vivacom and support them. The projection of the desired image was also successful, since the employees gave answers that supported the intended image by the management. Vivacom aims to be perceived as a leader in the Bulgarian telecommunication market, which is both modern and with traditions in its operations. The results proved that the employees really perceive the company as it was intended. The successfully adopted image will successfully project in the customers` perceptions afterwards (Miles & Mangold, 2004). According to Miles and Mangold (2004), the successful projection of the desired image depends on the effectively used channels for communication, the clear and consistent messages and the established psychological contracts. Therefore, the authors tested the opinions of the respondents for correlation between the evaluations of these three factors and the projected image. No significant correlation was found between the projected image and the evaluation of the channels used during the rebranding. Furthermore, correlation between the projected image and the evaluation of the changes after the rebranding was also not identified. However, there was a medium, positive correlation between the projected image and the evaluation of the messages sent regarding the rebranding. 5.7 Employee Resistance Organizational changes may lead to employee resistance, but its level depends on the essence and reasons of the changes (Zwick, 2002). Zwick (2002) notes that negative aspects of the organizational changes are more likely to cause high levels of resistance. In Vivacom`s case, the management did not observe employee resistance. On the contrary, they believe that the employees were enthusiastic and curious about the pending organizational changes. The results from the questionnaires did not show high levels of disapproval or confusion from the rebranding and the corresponding changes. The overall impression is that, there was not high level of resistance, but the respondents did not evaluate extremely positively the rebranding and the changes. Therefore, it could be concluded that the existence of employee resistance cannot be rejected, but its levels are low. The low levels can be explained with the relatively good management of the internal communication during 51

59 the rebranding (Proctor & Doukakis, 2003). Another reason could also be the fact that the changes after the rebranding were in a positive direction, as the respondents evaluate them. The slightly changed psychological contract can also explain the low levels of employee resistance. 52

60 6 Conclusion In this chapter the conclusions from the research are described. Moreover, its limitations are presented. Finally, suggestions for future research on the topic are made. The thesis aimed to investigate the internal rebranding process from employee`s perspective in the context of the largest Bulgarian telecommunication company Vivacom. More specifically the focus of the thesis is to discover on one hand what the management practices regarding the internal communication in the case of rebranding are, and on the other what is the opinion of the employees about these practices and about the applied by the management communication strategy. Thus the conducted research is directed to give some insights if the decisions and the implemented communication strategy in the rebranding process have worked over the employees as intended. Two interviews with the management of Vivacom and one questionnaire with the employees of the company has been carried out in order to answer the following five research questions, formulated in the thesis: What decisions does the management make about rebranding? Which are the components of the internal communication strategy used by manage-ment in the rebranding process? How do the employees evaluate the internal communication regarding the rebranding which the management uses? To what extent the desired image is perceived by the employees? Is there a correlation between the employees` perceived image and the used channels, messages and changes in the rebranding process? Through the decision to rebrand the company, the management of Vivacom has successfully combined the positive features from BTC and Vivatel brand. Moreover the change of name and logo as well as identity, vision and values of the company were a part of the management decision about which brand elements has to be included in the new brand. Thus the changed brand elements formed the main message, communicated from the management in the rebranding process. The internal communication strategy of Vivacom consisted of transferring the main message through the following channels: Intranet, meetings, corporate , mobile network. The tools used in the company`s strategy included the game fortune messages, the Big 5 campaign, the newsletter E-motion and the brand books which all represented the components of the internal communication strategy of the company. However the results from the study have shown that no matter how positive the management thinks that the employees percept the rebranding in response to the implemented communication strategy in the internal rebranding process, some of the management practices are evaluated by them with not so high effectiveness. It turns out that the face-to-face interaction in the official meetings, organized by the management for communicating officially the rebranding process has truly been perceived like the tool, preferred by the employees for announcing them the rebranding of the company. The new vision of the com- 53

61 pany is stated to be communicated by the Vivacom`s management in a proper way, as the employees have understand it and are agreed with it. As the new vision and new values are part of the corporate branding of the company, the management communicated most intensively to its employees the new corporate values of Vivacom. These values are intensively involved in the tools used in the internal communication strategy of the company such as the campaign the Big 5, the brand books and the game fortune messages in order to reach consistency. The outcomes of the research have pointed out some discrepancies though in the expectation of the management about how the employees will react to the internal communication efforts related to the rebranding process. Thus for instance the newsletter E-motion that aimed to provide a place for discussion between the company and its employees is evaluated to be unsuccessful in its function. Regarding the concept of psychological contract, special change in the agreement between the company and its employees is not indicated by the workers. Having in mind the employee`s good evaluation of the vision and values in the questionnaire it is not surprising that the projection of the desired image seems to be successfully adopted by the employees. This explains also the lack of employee resistance to the changes related to the rebranding of the company. Finally as an answer to the last research question in the thesis a positive correlation is found only between the image and the communicated message during the rebranding, which mean that the positive employees` evaluation of the message will lead to positive perception of the image of the company and vice versa. 6.1 Limitations The fact that only one company is investigated in one case study limits the generalizations from the conclusions made from the results from both qualitative and quantitative data. Moreover, the authors did not have full access to the information needed, which is understandable since Vivacom is a big company and some information is under their control. Furthermore, the small-sized sample is also a limitation for the generalizability in the conclusions. The physical distance from the company also seems to be a downside, since personal interviews would be more appropriate. Since the interviews as well as the questionnaire were translated by the authors from Bulgarian to English, there might be a possibility that the information translated is misinterpreted. In addition, an interview with the HR department of Vivacom could have been helpful for gathering more thorough information for the internal communication during the rebranding. However, due to the time constraints the authors could not reach an HR representative. 6.2 Future research It would be interesting to investigate the employee rebranding further in more companies from different industries in order to complete the whole picture and point out the good and bad practices in the internal communication. Moreover, investigation should be made on the perceptions of the employees regarding the rebranding with larger samples or even with personal interviews and focus groups. A longitudinal study could also be conducted in order to go deeper in the employees` perceptions before and after the rebranding, in which the differences in the perceptions among employees of different ages, lengths of service in the company, hierarchal levels and other groups can be measured. The authors believe that more research should be made in this particular area since a lot of organizations engage in rebranding activities nowadays, especially with the globalization and the wave of mergers 54

62 and acquisitions. It would also be useful if researchers develop a model specifically for employee rebranding. 55

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68 Appendix Appendix 1- Industry Spread of Rebranded Companies Frequency % IT-Telecom Finance and insurance 3% 4% 4% 4% 5% 3% 22% Utilities, energy and construction Healthcare and chemical products Professional, scientific, and educational services Manufacturing 7% 8% 16% Accomodation and food services Arts, entertainment, and media 9% 15% Other services Consumables Retail Transportation and warehousing Source: Muzellec, Doogan & Lambkin (2003). 61