managing organisation’s internal reputation: a comparative … · though times (argenti, 2009)....

Managing Organisation’s Internal Reputation: A Comparative Study of

Two Branches of ABC College

Rabiah Adawiah Abu Seman1 and Zulhamri Abdullah (PhD)

2

1Stamford College, Malaysia, [email protected] 2Universiti Putra Malaysia, Malaysia, [email protected]

ABSTRACT

The purpose of this paper is to analyse employees’

perception towards organisation’s internal

reputation and to identify the best predictor for

internal reputation measurement in different

branches. A comparative survey adopted from

WorkRep model has been conducted on 221

employees from Melaka and Selangor branch of an

education institution. This study indicated

education institution in Melaka branch

outperformed internal reputation of Selangor

branch. Leadership and performance element is the

most influential factor indicating employees’

perception towards organisation’s internal

reputation followed by products and responsibilities

in both branches.

Good ‘leadership and performance’ contributes the

most to an organisation’s internal reputation as it is

able to outshine other dimensions. Most employees

show their big support to organisations that have

good ‘leadership and performance’ and they are

willing to accept weaknesses of other dimensions.

‘Total reward’ and ‘work environment’ factors are

almost as equally important as other dimensions to

a moderate internal reputation organisation with a

weak measurement of ‘leadership and

performance’. Leaders play important role in

decision making which require practicing empathy

and having a better communication with employees

in building a good internal reputation.

‘Leadership and performance’ is very influential

and need to be stressed out in improving internal

reputation of ASEAN education institutions in

corporate communication context.

Keywords: Internal Reputation, WorkRep,

Supportive Behaviour, Branch Comparison.

I INTRODUCTION

Business today has never been the same as it was

50 years ago. “Public’s expectations of corporations

are also different from what they were 50 years

ago” (Argenti, 2009). In meeting various different

expectations from its constituents organisations

have to adapt to new environment changes,

strategic communication needs to be implemented

and it applies to large corporations and also small

businesses. Strategic communication management

is crucial in determining organisation’s success

(Argenti, 2009).

Corporate reputation is one intangible feature which

is able to influence customers, employee, investors

or other stakeholder’s decision on any action or

behaviour towards a company. It lies in the

stakeholders’ perception of the value and image of

the company, ‘in the eye of the beholder’.

Reputation is not easy to be built; it can take a

lifetime to build and merely a second to destroy it.

A tremendous corporate reputation is definitely not

the main goal of the company in achieving success

in their field. The most important thing is to get all

stakeholders; customers, investors, suppliers and

especially the employees to support them

(Rotterdam School of Management, 2008). This

support can be in any aspects such as purchase of

stock market or products, proudness of working

with the company, commitment with the company,

brand loyal and others. Fombrun and Shanley

(1990) explained that “corporate reputation enables

organisations to gain public recognition, charge

premium prices, attract talented workers, enhance

their access to particular markets and attract

investment” (Harvey & Morris, n.d, p.2).

According to Caes B.M Van Riel, corporate

reputation is “the collective representation of firm’s

past actions and results that describe the firm’s

ability to deliver valued outcomes to multiple

stakeholders” (Rotterdam School of Management,

2008). It is built through the experiences of

stakeholders, corporate communications and media

coverage about the organisations. Strong corporate

reputation will result in strong market value as it

gain trust and support from all stakeholders such as

employees, consumers, clients, media,

shareholders, government and suppliers. This will

also result in strong competitive advantage as it

gain support from all stakeholders. Companies with

strong corporate reputation are able to attract more

employments and has low turnover. This is due to

public and employees’ trust towards company’s

ASEAN ENTREPRENEURSHIP CONFERENCE 2012 AEC2012

strong economic value. The company is believed to

have a strong capital that it will not go bankrupt and

their welfare is well taken care of. A strong

company like this attracts more investment which

will build their strong foundation and increase

ability to expand the business. Suppliers fights to

win the tender to supply products which will benefit

the company in getting supplies at lower cost.

Strong corporate reputation companies are always

favoured in collaboration with any other

commercial or non-commercial institution or

organisation (Rotterdam School of Management,

2008).

Argenti (2009) explained “reputation is different from

image because it is built up over time and is not simply a

perception at a given point in time – it is product of both

internal and external constituencies” (p.91). Reputation

comes from long years of perception from the

stakeholders towards a company. Stakeholders perceive it

through their experience, family and friends’ experiences

and also from the media such as television, radio,

newspaper, magazine or internet. Information gained

from these experiences builds the image and over the

years it builds the reputation of the company as being

good or bad.

Michelon (2011) quoted Roberts, Dowling (2002)

and Little (2000) that “reputation can be defined as

an organisational attribute that reflects the extent to

which stakeholders see the company as a good

corporate citizen, and it, therefore, constitutes an

intangible asset with the potential for creation of

value” (p.80) Fombrun and Van Riel (1997) also

defined reputation as “subjective collective

assessment of the trustworthiness and reliability” of

companies (Michelon, 2011, p.80).

According to Charles Fombrun, to build a good

reputation, it is important to concentrate on creating

and building a distinctive corporate identity. From

there, the good and coherent corporate image has to

be projected to the stakeholders and maintain

though times (Argenti, 2009). Corporate identity

plays a very important role in building and

maintaining corporate reputation of a company.

Corporate reputation derives from the perception of

the stakeholders which includes their “expectation”,

“attitudes” and “feelings” towards company’s

image and the real value image which projected

from the corporate identity of the company

(Argenti, 2009).

Internal Reputation. For an academic institution,

the internal stakeholders are students and

employees. Internal reputation is constructed from

internal stakeholders’ perception and emotional

attitude towards an organisation (Chun, 2010).

Grandison and Sloman (2000) quoted ‘emotional

appeal implies respectability, appreciation and

trust’ in explaining emotional bond (Karak, 2010,

para 23). Positive or negative feelings or attitude

towards an organisation represent the perception

which is the reputation of the organisation.

Organisation’s internal reputation is built on the

degree of employee’s emotion on the organisation

and perceives the organisation (Chun, 2010).

Emotional Bond is also explained as employees’

satisfaction towards employer. Davies and Chun

(2002) defined employees’ satisfaction as “degree

which an employee has positive emotions towards

the organisation”.

Figure 1: WorkRep Model

Dr Charles Fombrun from Reputation Institute has

developed WorkRep model (Figure 1) in studying

workplace reputation among employees which has

been derived from Reptrak model. It has been

widely used in measuring workplace reputation

among the key stakeholder employees in

organisations around the world (Reputation

Institute, 2011). Pulse in this model or Emotional

Bond are same as Pulse in Reptrak’s core. Degree

of reputation is measured by the degree of

employees’ trust in the organisation, employees’

good feeling towards the organisation, employees’

admiration on the organisation and esteem towards

the organisation.

There are only 5 dimensions that drive the

workplace reputation and it is also known as

Rational Bond. 5 dimensions of this WorkRep are


Leadership and Performance, Products and

Responsibility, Work Environment, Professional

Development and Total Rewards. However,

through various studies by Reputation Institute,

workplace reputation is influenced by only 4

dimensions which are Leadership and Performance,

Products and Responsibility, Work Environment

and Professional Development. Employees

satisfaction and perception towards these

dimensions or Rational Bond determine the degrees

of admire, trust, good feeling and trust among the

employees as it influence their emotional feelings

and favourable attitude towards the organisation

(Reputation Institute, 2011).

“Most of today’s employees are well educated, have higher expectations of what they will get out of their careers than their parents did, and want to understand more about the companies they work for” (Argenti, 2009). Employees nowadays have different standards and principles. They are more exposed to various industry related information and demand for transparencies at work. As what happened to Wal-Mart in 2006 when they were accused of unfair treatment of employees such as preferring men over women in terms of salary and advancement, and imposing employees to work off the clock, Wal-Mart has been badly condemned by numerous media. This has caused Wal-Mart a bad reputation and drop in sales. The employees refused to care about the company and do as they were instructed to do because Wal-Mart did not care about them neither according to them (Argenti, 2009).

“Employer branding has become a more popular

topic due to an increase in the power of brand, an

increase in focus on employee engagement, a tight

labor market and “war for talent” (Butler & Tuuk,

2012, p.1). According to studies, a strategic

management of “employee value proposition’ is

useful in benefiting organisations such as increase

of vacancy applicants by 20%, increase of cost

effectiveness of payroll and most importantly

higher commitment among employees. Microsoft

has also taken the same step by encouraging and

helping employees to realize their own potential

and be brave to “take the challenge and see them

through” (Butler & Tuuk, 2012).

“Marketing has been focusing on brand

management for many decades, but companies’

targeted and strategic focus on employer brand

management from an internal perspective is a

relatively new phenomenon” (Butler & Tuuk, 2012,

p.1). Over half of companies were found to focus

and deliberate on internal branding as much as

external branding. It influences how employees

value their employer and employees’ behaviour

towards the brand or employer which can also

influence customer’s perception towards the

organisation. The importance of internal reputation

has been proven by Chief Operating Officer (CEO)

of HCL Technologies in India, Vineet Nayar. He

practices “employee first, customers second”

unconventional idea in HCLT and has made a

tremendous positive changes to the company

(Nayar, 2010). Employers realize how employer

brand is crucially important in determining ups and

downs of an organisation that many leading

organisations have started to implement internal

branding strategy. They recognize the importance

of engaging the employees in increasing their

productivity and gaining profit. Top organisations

like GE, HP, IBM, Microsoft, Nokia-Siemens,

PepsiCo, P&G, RBS, Shell and Unilever have

started to implement “active employer brand

development strategies” towards achieving positive

internal reputation. “They are also beginning to

recognise that creating a positive brand experience

for employees requires the same degree of focus,

care and coherence that has long characterised

effective management of the customer brand

experience” (Mosley, 2009). It is believed that

positive internal reputation is highly associated with

organisation’s positive profit growth as studied by

Sears that “4% increase in employee satisfaction

would translate into more than $200m in additional

revenue”. Another study conducted on Standard

Chartered Bank has resulted with branches with

“highly engaged employees were associated with

greater revenue growth (+ 6%) and greater profit

margin growth (+100%)”. Internal branding helps

to gain employees acceptance and commitment by

giving the same brand experience as expected to be

experienced by the customers to the employees.

“Employees are unlikely to ‘live the brand’ unless

they experience it for themselves, and if employees

fail to deliver on the brand promise, the investment

in marketing the new message is likely to be

counter-productive” (Mosley, 2009, p.11).

Factors predicting internal reputation. Hong and

Yukl (1994) explained that “leadership develops

favorable internal reputation and generate positive

word-of-mouth and supportive behavior” (Men,

2010, p.39). Leaders in an organisation play a big

role in getting employees’ good feeling towards the

organisation. Good leaders can sustain employees’

trust, admiration and loyalty even in economic

downturn. Downling (2004), Fombrun (2000) and

Helm (2005) also agreed with the finding that

‘leadership quality’ is one of the most important

factors in reputation (Men, 2010, p.38). Other

researchers such as Rafferty and Griffith (2004)


also indicated about the positive correlation

between transformational leadership and

employee’s satisfaction where they show positive

emotions such as happiness, superiority, esteem and

enthusiasm. When a transformational leader

practices employee empowerment where employees

are given a voice in decision making, employees

will feel appreciated, trusted and valued by leaders

or organisation generally. Combination of these

emotions outlines favourable perception towards

the organisation (Men, 2010, p.37). “New

leadership is another opportune moment for internal

rebranding” as employees are normally open up to

new ideas which has proven to Hewlett Packard and

Sears (Mitchell, 2002, para 7). A lot of colleges are

currently going through bad financial problem

which affects the employees such as late salary,

reduction of salary or lay off from work. However

due to good leadership where empathy, concern on

employees’ welfare and safety is shown,

organisation’s reputation rate does not decrease

much (Fischman, 2010). Clive (2003) also agreed

that apart from other factors contributing to

employees’ satisfaction such as ‘work conditions’,

incentives, other benefits and rewards system,

leadership also plays an important role in shaping

employee’s satisfaction.

Feeling of comfort and security influences

employees’ attitude towards the organisation where

they will feel the positive emotion and give their

loyalty and commitment to the organisation (Clive,

2003). Employees in IKEA are given equal chances

and heard in decision making and this is called

employee empowerment. IBM is famous with its

motto ‘today, collaboration is the name of the

game’ where they encourage every stakeholders

including customers to work together with them in

creating the world of innovations (Pot, 2010).

Fombrun (2000), Laschinger, Finegan & Shamian

(2001) and Kirkman & Rosen (1999) stated

‘employee empowerment leads to employee

satisfaction, commitment, trust, loyalty and quality

organisation’ (as cited in Men, 2010, p.39). If

employee is given higher authority or trust in

decision making by an organisation, organisation

will also be more trusted by the employee in return

(Men, 2010). Research by Laschinger, Finegan and

Shamian in 2001 concluded a ‘significant positive

relationship between employee empowerment and

work attitudes and performance’ as cited in Men,

2010, p.14).

Early research by Herzberg (1966) has found out

that employee development has positive correlation

with their satisfaction towards and organisation.

Their level of motivation will increase if they are

filled with trainings and developments to improve

their skills and knowledge. From here employees

have a chance to get better achievement,

recognition, stimulation, responsibility and

advancement (as cited in Mani, 2010, p.131).

However, employees nowadays do not emphasize

more on their professional development or career

path (Dortok, 2006) contradicting with employees

in education industry (Karak, 2010).

According to Richardson and Bolesh (2002)

maintaining a high quality products or high

standard procedures or services is very important

for an organisation with a good reputation. High

ethical and transparency practice in producing

quality products and services help to keep their

reputation at a good place (as cited in Le Roux,

2003, p.88). A study conducted by Denmark

Reputation Institute on higher education institution

in Denmark concluded that ‘products and ethics’ as

one of the two most important workplace reputation

drivers. Reputable companies conducting business

with integrities are most likely to be the choice of

potential employees among Scandinavians

(Fombrun, 2007)

A study conducted on education institution in

Turkey indicated rewards and remuneration such as

good salary system, unbiased promotion system and

retirement system as the highest priority to the

academic staff. This reputation dimension is also

very important in other parts of Europe and

America as employees normally switch jobs and go

for higher paychecks (Toker, 2011). This study is

consistence with studies conducted by Eskildsen

(2004) and Liou et al (1990) which concluded

physical reward like remuneration, salary or

benefits has positive influence on employee

satisfaction towards an organisation (as cited in

Mani, 2010, p.130). Mani (2010) conducted a study

himself in India and found out that employees in

India see extrinsic reward as one of the important

factor in determining employees’ satisfaction too.

These studies’ result however contradicts with

Zagorsek’s study in 2008. According to him even

though employees’ needs of extrinsic reward are

fulfilled, this economic transaction does not

contribute much in generating favourable emotion

towards an organisation nor guarantee employees’

commitment. Other reputation drivers are likely to

be more important than compensation (as cited in

Men, 2010, p.38). Employees are willing to accept

lower compensation from an organisation or brand


that they trust or respect. The most important thing

is delivering promises through products or services

with integrity and highly ethical as trusted by users

or stakeholders (Strategic Direction, 2008).

II METHODOLOGY

Survey instrument has been drafted based on

WorkRep and Reptrak model. Some of the

questions have been adapted from studies

conducted by Reputation Institute. In order to

evaluate the reliability of survey instrument, pilot

test has been conducted on 30 respondents which

has resulted with Cronbach alpha value of 0.965.

Questionnaires have been distributed to 221 out of

251 employees of ABC College who were not

involved in the p test however only 118 completed

questionnaires were returned back. Questionnaire

was drafted into 4 sections as explained in Table I

according to the theoretical model ; WorkRep

model where all objectives are measured using

Likert Scale and analysed using Descriptive

Analysis and Multiple Regression.

Table 1: Distribution of research items in

questionnaire

Section Description

Section A Demographic Data

Section B Emotional Bond

Section C Reputation Dimension – Leadership &

Performance

Reputation Dimension – Work

Environment

Reputation Dimension – Professional

Development

Reputation Dimension – Products &

Responsibility

Reputation Dimension – Total Rewards

Section D Supportive Behaviour

III FINDINGS

Survey instrument has been drafted based on

WorkRep and Reptrak model. Some of the

questions have been adapted from studies

conducted by Reputation Institute. In order to

evaluate the reliability of survey instrument, pilot

test has been conducted on 30 respondents which

has resulted with Cronbach alpha value of 0.965.

Questionnaires have been distributed to 221 out of

251 employees of ABC College who were not

involved in the p test however only 118 completed

questionnaires were returned back. Questionnaire

was drafted into 4 sections as explained in Table I

according to the theoretical model ; WorkRep

model where all objectives are measured using

Likert Scale and analysed using Descriptive

Analysis and Multiple Regression.

A. Employee’s Perception on ABC College’s

Internal Reputation

A decoder interpreting result obtained from survey

conducted is shown in Table 2 where 1 point is

decoded as ‘Poor’, 2 points is decoded as ‘Weak’ or

‘Vulnerable’, 3 points is decoded as ‘Average’ or

‘Moderate’, 4 points is decoded as ‘Strong’ or

‘Robust’ and 5 points is decoded as ‘Excellent’ or

‘Top Tier’.

Table 2: Distribution of decodes of each point for

reputation rate

Point(S)

Decode

1 Poor

2 Weak or Vulnerable

3 Average or Moderate

4 Strong or Robust

5 Excellent or Top Tier

According to Table 3, overall rating for ABC

College corporate reputation is rated 3.297 out of 5

points by the employees which falls under

‘Average’ or ‘Moderate’ as interpreted in Table 2.

Item ‘ABC College has a good reputation’ rated

highest (µ = 3.500, SD = 1.210) whilst item ‘I trust

ABC College’ rated lowest (µ = 3.085, SD = 1.144)

in the survey conducted.

Table 3: Mean and Standard Deviation for Emotional

Bond (n=118)

Emotional Bond Mean SD

ABC College has a good

reputation

I have a good feeling about ABC

College

I admire and respect ABC College

I trust ABC College

3.500

3.314

3.288

3.085

1.210

1.068

1.125

1.144

Average 3.297 1.137

Anova test was carried out to determine the

difference among branches towards ABC College’s

internal reputation. As shown in Table 4, the

outcome revealed that there was mean differences

between groups and within groups of branches

towards ABC College’s internal reputation.


Table 4: ANOVA Test of ABC College’s internal

reputation on different branch (n=118) Source Lev

el

Of

Free

dom

Sum Of

Squares

Mean

Squares

F Value Sig

Value

(p)

Intra

group

Inter

group

1

116

12.687

50.330

12.687

0.434

29.240

0.000**

Total 117 63.017

**p=0.000, p<0.05

The F value was 29.240 while the significant value

was (p=0.000 which is below the significant level

(ɑ=0.05). Therefore there is a significant difference

of ABC College’s internal reputation between

Selangor and Melaka branch.

ABC College has two branches; Selangor and

Melaka where respondents in both campuses rate

their employer differently. According to Table 5

respondents in Selangor rate ABC College at 2.983

which is under the ‘Weak’ or ‘Vulnerable’ category

as followed in Table 2 and respondents in Melaka

rate ABC College at 4.217 which is decoded under

the ‘Strong’ or ‘Robust’ category.

Table 5: Independent T Test of ABC College’s

internal reputation rate on different campuses

(n=118)

Office Location N Average

Mean

T

Value

Sig Value

(p)

Selangor

Melaka

88

30

2.983

4.217

-

8.644

0.000

Table 6 represents means for each attributes of

emotional bond that measures the internal

reputation of both campuses of ABC College;

Selangor and Melaka. Highest contribution to the

means is item “ABC College has a good reputation”

with mean of 3.205 for SEL and 4.367 for MK.

This item is rated as slightly higher than ‘Not Sure’

for Selangor and slightly higher than ‘Agree’ level

for MK. Item ‘I trust ABC College’ did not get

good response from respondents in Selangor as it is

rated as somewhere between ‘Disagree’ and ‘Not

Sure’ level with mean of 2.693. However this item

received good response from respondents in MK

rated mean 4.233.

Table 6: Mean and Standard Deviation of Emotional

Bond on different branch (n SEL = 88, n MK = 30)

Emotional Bond Mean SD

*SEL **MK *SEL **MK

ABC College has a

good reputation

I have a good

feeling about ABC

College

I admire and respect

ABC College

I trust ABC College

3.205

3.068

2.966

2.693

4.367

4.033

4.233

4.233

1.224

1.070

1.066

1.010

0.615

0.669

0.678

0.626

Average 2.983 4.217 1.093 0.647

*SEL = Selangor

**MK = Melaka

B. Contributing Factors Indicating Employee’s

Perception Towards Organisation’s Internal

Reputation

R value 0.831 indicates a strong correlation

between the independent variables (Rational Bond)

and dependent variables (Emotional Bond). ABC

College’s Emotional Bond can be largely explained

by 69% of the Rational Bond’s variables

(R²=0.690) and WorkRep model applied for this

research is significantly good in predicting

employee’s Emotional Bond towards ABC College

(Sig F=0.000, p<0.05)

Correlation and multiple regression analyses have

been conducted to study the relationship between

Emotional Bond and various predictors under

Rational Bond. Table 7 summarizes the descriptive

statistics and analysis results. Table7 shows that

each of the Rational Bond variable’s score is

positively and significantly correlated with the

criterion, signifying that higher scores on these

variables tend to contribute to higher score of

Emotional Bond. The multiple regression model

with all five predictors produced R² = 0.690, F =

49.81, p < .005. As can be seen in Table 7, variable

‘Leadership and Performance’, ‘Work

Environment’, ‘Professional Development’,

Products and Responsibility’ and ‘Total Rewards’

had significant positive regression weights,

indicating higher scores on these variables were

expected to cause a higher Emotional Bond score.

Each point increase on ‘Leadership and

Performance’ variable will increase Emotional

Bond’s score by 0.395, ‘Work environment’ will

increase Emotional Bond by 0.218, ‘Products and


Responsibility’ will increase Emotional Bond by

0.283 and ‘Total Rewards’ will increase Emotional

Bond by 0.222. Whilst, each point increase of

‘Professional Development’ will predict lower

Emotional Bond’s score by 0.242.

Table 7: Predictors of the Emotional Bond using

Standard Multiple Linear Regression (enterwise

method)

Variables B Beta R p T

Intercept

Leadership and

Performance

Work

Environment

Professional

Development

Products and

Responsibility

Total Rewards

3.281

0.263

0.128

-0.282

0.232

0.232

-

0.395

0.218

-0.242

0.283

0.222

0.767

0.739

0.618

0.763

0.718

0.000

0.000

0.026

0.015

0.012

0.019

3.816

3.750

2.261

-2.473

2.547

2.378

F =49.810 r =0.831

Sig-F =0.000 R2= 0.690 Adj. R2 = 0.676

Melaka. From Table 8, WorkRep model used is

significant to predict Emotional Bond of ABC

College (Sig F=0.000, p<0.05).

Table 8: Predictors of the Emotional Bond in Melaka

branch using Standard Multiple Linear Regression

(enterwise method)

Variables B Beta r P T

Intercept

Leadership and

Performance

Work

Environment

Professional

Development

Products and

Responsibility

Total Rewards

2.734

0.450

-0.127

-0.038

0.275

0.122

-

0.733

-0.236

-0.030

0.310

0.137

0.873

0.703

0.573

0.736

0.764

0.218

0.001

0.313

0.834

0.123

0.446

1.264

3.717

-1.031

-0.211

1.587

0.776

F =18.124 r =0.889

Sig-F =0.000 R2 =0.791 Adj. R2 = 0.747

R value 0.889 indicates a very strong correlation

between independent variables (Rational Bond) and

dependent variables (Emotional Bond). Table 8

explained a large role of independent variables to

79.1% of Emotional Bond with R² =f 0.791. As the

regression analysis was carried out using the

enterwise method, none of the variables to

‘Emotional Bond’ was dropped. The largest beta

coefficient is 0.733 which is for ‘Leadership and

Performance’ indicating any standard deviation

increase of ‘Leadership and Performance’ will

predict a higher Emotional Bond’s standard

deviation by 0.733. This means that this variable

makes the strongest unique contribution in one’s

‘Emotional Bond’, when the variance explains by

all other predictor variables in the model are

controlled. The Beta value for ‘Products and

Responsibility’ is the second highest (0.310),

followed by ‘Work Environment’ with 0.236 in the

third place, ‘Total Rewards’ (0.137) in the fourth

place and lastly, ‘Professional Development’ with

0.030. Both ‘Work Environment’ and ‘Professional

Development’ indicate a lower standard deviation

of Emotional Bond by 0.236 and 0.030 with their

increase of standard deviation.

Selangor. Based on analyses from Table 9,

WorkRep model used is significant to predict

Emotional Bond of ABC College for Selangor

branch (Sig F=0.000, p<0.05). R value 0.741

indicates a strong correlation between independent

variables (Rational Bond) and dependent variables

(Emotional Bond). Table 8 explained a big role of

independent variables to 54.9% of Emotional Bond

with R² of 0.549.

Table 9: Predictors of the Emotional Bond in

Selangor branch using Standard Multiple Linear

Regression (enterwise method)

VARIABLES B Beta r P T

Intercept

Leadership and

Performance

Work

Environment

Professional

Development

Products and

Responsibility

Total Rewards

2.745

0.273

0.144

-0.301

0.243

0.255

-

0.332

0.234

-0.236

0.267

0.226

0.616

0.614

0.407

0.634

0.564

0.026

0.003

0.032

0.032

0.027

0.035

2.273

3.057

2.179

-2.183

2.246

2.147

F =19.926 r =0.741

Sig-F =0.000 R2 =0.549 Adj. R2 = 0.521

As the regression analysis was carried out using the

enterwise method, none of the variables to

‘Emotional Bond’ was dropped. Four predictors

indicate significant positive regression weight


signifying higher standard deviation of these

predictors will increase standard deviation score of

Emotional Bond including ‘Leadership and

Performance’, ‘Products and Responsibility’,

‘Work Environment’ and ‘Total Rewards’ whilst

‘Professional Development’ indicates significant

negative regression weight to Emotional Bond’s

score. The largest beta coefficient is 0.332 which is

for ‘Leadership and Performance’ indicating any

standard deviation increase of ‘Leadership and

Performance’ will predict a higher Emotional

Bond’s standard deviation by 0.332. This means

that this variable makes the strongest unique

contribution for ‘Emotional Bond’, when all other

predictor variables in the model are controlled. The

Beta value for ‘Products and Responsibility’ is the

second highest (0.267), followed by ‘Professional

Development’ with 0.236 in the third place, ‘Work

Environment’ (0.234) in the fourth place and lastly,

‘Total Rewards’ with 0.226. ‘Professional

Development’ indicate a lower standard deviation

of Emotional Bond by 0.236 with its’ increase of

standard deviation.

IV DISCUSSION

On overall, ABC College’s internal reputation is

rated 3.297 by the employees and it falls under

Average or Intermediate category. Looking at the

rate, there are still a lot of rooms for improvement

as employees play a big role especially in service

industry and in highly competitive industry like

education. The rapid growth of education industry

gives customers like students or parents a wide

range of choices to choose from. The trust gained

from employees is very important as employees are

the organisation’s front liners who deal with

customers every day. If there is no trust in the

organization, there is a possibility they may open

up and voice out their dissatisfaction to anybody

and overheard by anybody especially customers.

Thus will jeopardies organisation’s reputation and

damage reputation badly. Reputation and

satisfaction are aligned and related to each other

(Dortok, 2006).

Employees from both branches in Melaka and

Selangor perceive their employer differently, same

as Standard Chartered Bank’s employees (Mosley,

2009). Melaka branch has a good reputation unlike

Selangor branch that has a bad reputation which

clearly shows that its employees have negative

emotions towards ABC College. This difference

may be caused by many factors such as different

leadership which may practice different ideas in

these two branches or ‘leadership quality’ which is

one of the most important factors in reputation

(Men, 2010). Leaders’ decision on employee

empowerment, decision ship, transparency and

others can influence employee’s perception towards

its employer (Nayar, 2010). Difference of

perception may be also explained by “nested set of

subculture” which exist in different branch as

studied by Rosen (1985) on advertising agency

(Wilson, 1997, p. 167) and has caused employees to

perceive and understand their employer differently.

It is agreed by Moller (2009) in his study on

internal branding of organisations in UK and

Denmark that culture plays a role in determining

employees’ emotion towards an organisation.

This study indicates that the most important factor

predicting ABC College’s internal reputation is

leadership. WorkRep model used for this study

resulted in high contribution of 69% to internal

reputation measurement. As shown in Table 10, in

general ‘Leadership and Performance’ factor

contributes 39.5% to ABC College’s internal

reputation. While ‘Professional Development’

contributes negatively to ABC College’s internal

reputation which contradicts with Karak’s research

in 2010 where he concluded high level of

satisfaction towards professional development

provided by employer will also increase favourable

level towards the organisation.

Table 10: Distribution of the contribution of each

reputation dimension to internal reputation

Reputation Dimension Contribution (%)

Leadership and Performance

Work Environment

Professional Development

Products and Responsibility

Total Rewards

39.5

21.8

-24.2

28.3

22.2

However, branches in Melaka and Selangor are

perceived differently by ABC College’s employees

which can be clearly explained in Table 11 and

Table 12. In Melaka branch, ‘Leadership and

Performance’ contributes majorly in predicting its

internal reputation. Leadership and company’s

performance is seen as the biggest factor in

determining employees’ favorable attitude and

emotion towards ABC College and its internal

reputation generally. Selangor branch’s employees

has the same attitude towards its ‘Leadership and

Performance’ but this factor does not contribute as

high it is in Melaka.



reputation dimension to internal reputation (Melaka)



Work Environment



Total Rewards

73.3

-23.6

-3.0

31.0

13.7


reputation dimension to internal reputation

(Selangor)



Work Environment



Total Rewards

33.2

23.4

-23.6

26.7

22.6

In both branches ‘Professional Development’ is not

seen as positive factor in predicting internal

reputation. Least positive predicting factor towards

positive internal reputation is ‘Total Rewards’ and

this result is similar with Zagorsek’s study in 2008

which concluded human’s fundamental needs are

important to employees but does not much

influence employees’ favourable emotion towards

the organisation. Remuneration system,

compensation or rewards make employees happy

but this item is not the influencing factor of their

trust and motivation to work. Even though

employees do not get high salary or bonuses, they

do not use it as the main reason to switch job (Men,

2010, p.38).

‘Products and Responsibility’ is the second highest

contributing predictor to internal reputation of ABC

College in both Melaka and Selangor branches.

Apparently, a study by Reputation Institute on

workplace reputation in Denmark came up with the

same result where products and ethics has been

rated among top two important factors of

favourable decision towards an organisation.

Employees are committed to work for organisation

that upholds and maintain high quality products or

services and practice high ethical standard in

running their business (Fombrun, 2007).

Both employees in Melaka and Selangor branches

have different stand on ‘Work Environment’ factor.

For employees in Melaka, ‘Work Environment’

factor is seen as negative predictor to internal

reputation unlike in Selangor branch. This is similar

as tudy in Turkey where the finding showed that

higher education employees in Turkey rate physical

facilities or environment as the least important

factor in determining their emotion towards an

organisation (Toker, 2011). Compared to study by

Eskildsen (2004) and Martensen & Gronholdt

(2001), social atmosphere at workplace is regarded

as one principal factor contributing to employee’s

motivation and favourable emotion towards an

organization (as cited in Mani, 2010, p.130) which

is consistent with acceptance of ‘Workplace

Environment’ in Selangor branch.

Employees at the branch which has a good

leadership do not seem to take other unimportant

factors such as ‘Work Environment’ and

‘Professional Development’ into account as they

are content enough working under a good

leadership that they rate internal reputation highly.

V CONCLUSION

This study focused on the difference of employees’

perception on internal reputation in different

branch. Employees in different branches have

different emotions towards their employer and this

may resulted from different set of nested

subcultures in different branches as explained by

Wilson (1997). Despite of the differences,

leadership and organisation’s performance are still

seen as the biggest factor in gaining employees’

trust and predicting one’s internal reputation. Good

leadership is able to outshine other dimensions in

predicting internal reputation as seen on Melaka

branch’s result. Without a good leadership or

company’s good performance, other factors are

perceived as important as leadership and

performance factor. As Butler and Tuuk (2012)

explained “different employee groups are going to

have vastly different desires” (p.2). It is also

important to keep in mind that employment

branding inherently suggests differentiation of a

firm’s characteristics as an employer from those of

its competitors. Additionally, focusing on what is

unique to their specific company and highlighting

“signature experiences will help companies create a

successful employer brand” (Butler & Tuuk, 2012,

p.2) Organisations need to focus on engaging its

employees and study their different needs, desires

and subcultures in managing the internal reputation.

Practical implication. Good ‘leadership and

performance’ contributes the most to an

organisation’s internal reputation as it is able to

outshine other dimensions. Most employees show

their big support to organisations that have good

‘leadership and performance’ and they are willing

to accept weaknesses of other dimensions. ‘Total

reward’ and ‘work environment’ factors are almost


as equally important as other dimensions to a

moderate internal reputation organisation with a

weak measurement of ‘leadership and

performance’. Leaders play important role in

decision making which require practicing empathy

and having a better communication with employees

in building a good internal reputation.

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