Corporate Communication, RQ - May 2016

1. Table of Contents
Abstract.........................................................................................................2
1. Business is war - Alpha, Omega and Zeta firm.......................................2
1.1 Introduction...................................................................................................................... 2
1.2 Alpha Firm ....................................................................................................................... 3
1.2.1 CC – Loan Sharks ..................................................................................................... 4
1.3 Omega Firm...................................................................................................................... 4
1.3.1 Corporate Communication........................................................................................ 5
1.4 Zeta Firm.......................................................................................................................... 7
1.4.1 CC – The case of AirAsia ......................................................................................... 8
1.5 Conclusion........................................................................................................................ 9
2. RQ – Reputation Quotient, the case of SMEs in Malaysia ...................10
2.1 Introduction.................................................................................................................... 10
2.2 Six dimensions ............................................................................................................... 11
2.2.1 Emotional Appeal ................................................................................................... 11
2.2.2 Product and Services............................................................................................... 12
2.2.3 Vision and Leadership ............................................................................................ 13
2.2.4 Workplace Environment ......................................................................................... 14
2.2.5 Social and Environmental Responsibility ............................................................... 14
2.2.6 Financial Performance ............................................................................................ 15
2.3 Conclusion...................................................................................................................... 16
References...................................................................................................18

CMCC5103 – Alpha, Omega and Zeta firm, and RQ Nor Helmee Bin Abd Halim
2
Abstract
This paper discusses three types of Alpha, Omega and Zeta firm. The primary objective of all three
firms is about the same – profit maximization. In a real world, all three types of the firm conduct
their business based on these three concepts, one-dimensional (commerce), two-dimensional
(commerce and law) and three-dimensional (commerce, law and reputation) concept. The second
part of this paper discusses the six-dimensions of Reputation Quotient (RQ). Reputation is an
intangible asset that has a powerful influence of overall performance of a company. The focal
discussion and examples will be based on SMEs companies competing for market share in the
emerging markets of Malaysia.
1. Business is war - Alpha, Omega and Zeta firm.
1.1 Introduction
Why “business is war”? What is the connection between business and warfare or military?
Business and military share many similarities which both are concerned with competition and how
to succeed in the face of determined adversaries. Military prepares forces to fight and win on the
battlefield, and in the business world, strategies are developed for organizations to operate
successfully in the competitive marketplace (battlefield). A great Chinese General and the author
of the oldest military book, the Art of War, indicates that when the militaries prepare for war, they
must consider the weapons, armies, terrain and so on. In the business world, organizations must
consider many factors such as culture, technologies, shareholders, resources as well as corporate
communication (CC). In a nutshell, this briefly answer the above questions.
Today, in the 21st century business world is more challenging and very competitive. The
advent of the Internet and communication play an important role for organizations and business
leaders to compete with their rivals. Author of Building Reputational Capital book, Jackson (2004)
describes three notions of how business leaders will view today’s world of business. There are
three types of firm, 1) Alpha firm 2) Omega firm and, 3) Zeta firm. These three types of firms
basically having the same vision and objective of maximizing profits and at the same time applying
the same approach of corporate communication (CC) in their business operations.

3
As discussed in many literatures, CC has been summarized as a set of activities involved
in managing and orchestrating internal and external communication which aimed at creating
favorable relations with stakeholders. The common goal of the activities around CC is to build
competitive advantage as well as to improve the firm’s bottom line (van Riel and Fombrum 2007;
Lah, M., Sušjan, A., and Redek, T, 2016). The subsequent sections will discuss all three types of
firms and the function of CC activities in improving and sustaining the firm’s overall performance.
1.2 Alpha Firm
According to Jackson (2004), Alpha firm exists simply for profit maximization. The mentality of
the people or firm in this world of business is only about making money. Every move they do is
to maximize the bottom line of the business or the firm regardless of what or how they do it even
if they have to break the law. Jackson puts a stronger notion in his book by saying “If you can
make more money for yourself or your firm by breaking the law, and think you can get away with
it, go for it”. He added that the only reason for the firm to obey the law is to avoid the monetary
cost of being noncompliance. Simply put, the firm will do whatever it takes from being caught.
Loan sharks, money laundering business, get-rich-quick scheme, black-market lottery,
gambling, prostitution or any vice activities businesses are examples in this category. All these
kind of businesses are considered unethical and immoral, but as highlighted by Jackson (2004),
“the business of business is business, period”. It’s a one-dimensional as the business exists is
mainly because of demand in the marketplace. The operators are taking full advantage by making
as much profit as they could.
In a recent news reported by a local newspaper, “So long, Ah Long syndicate”, The Star.
(2016), local authorities busted one of the biggest “Ah Long” or loan sharks (illegal money lender)
firm in the country. The authority seized RM1.6 million worth of assets, including nine cars and
RM82, 800 in cash. It was reported that the firm had a turnover of RM8 million per month. The
firm had been in the business for two years before they were taken in. From a business perspective,
it tells us how lucrative to endeavor in such business, but from a different point view, it’s a risky
business.

4
1.2.1 CC – Loan Sharks
Using loan sharks firms as an example, as reported by The Star (2016), the firm operates its
business behind the name of a shell company. In the business management dictionary, shell
company is defined as an entity that has no active business and usually exists only in name as a
vehicle for another company’s business operations. It is usually associated with any form of illegal
businesses including money laundering activity by illegal financial experts. The Alpha firm is
basically operates their business behind the shell name as cover up to their illegal business activity.
In a typical business situation for an Alpha firm, loan sharks firm does not have a physical
building to operate their business. They work from home or virtually through the Internet. They
usually have a strong connection with gangsters, mobsters and other business alliances. There is
minimal open interaction or communication about the firm to the public as public exposure is a
risk to the business. The firm, however, often targets low income, close friends and desperate
families by approach them personally and lure them to indulge in the business. While Griffith &
McLean (2015) suggested that with the advent of the Internet marketing, firms today utilize this
technology to advertise and promote their business via social media, blogs, forums, email
spamming and send text messaging randomly to the people. In the context of an Alpha firm, due
to limited access to formal advertisement slot like newspapers and magazines, they maximize the
Internet platform as an alternative to build its business reputation and ultimately improving its
bottom line. In essence, Alpha firm also relies on many kinds of CC activities to keep their business
alive.
1.3 Omega Firm
Omega firms as explained by Jackson (2004), operate based on two-dimensional world. They rely
on the law and economics. Nevertheless, a high profile Omega firm, for example MAB which is
used in the following example, also consider firm reputation as their key source of sustainable
competitive advantage to compete with its rivals. The disappearance of MH370 and the downing
of MH17 crisis communication illustrates how the firm view firm reputation is utmost important
to regain customer’s confidence on the national flag carrier.

5
Typically, profit maximization activities by these firms are constrained by legal restrictions
and the business is monitored by regulatory bodies. Like any other organizations, the Omega firm
is free to compete with others, however, they operate under certain limitations or restrictions which
is imposed by the local authorities. A state-owned company or Government-Linked Company
(GLC) is an example of organization operates under Omega firm. GLCs in Malaysia are defined
by Khazanah Nasional Berhad (the investment arm of the country), as companies that have primary
commercial objective and in which the Malaysian government has a direct controlling stake or
owned, controlled by the government. (Minhat & Abdullah, 2014).
1.3.1 Corporate Communication
According to Argenti (1996, 2006), an organization’s corporate communication function is
responsible for communication with both internal and external constituencies. The CC activities
include media relations, identity and image, investor relations, internal or employee
communications, government relation or public affairs, community relations, corporate
philanthropy, corporate reputation, marketing communication, event, publication, crisis
communications, website as well as social media. The activities become so important when
internal and external stakeholders begin demanding more information from organizations
(Cornelissen, 2008). These activities are usually handled by a dedicated unit, department or
division. Some examples of how firm indulges in such activities are discussed in the following
sections.
1.3.1.1 Employee Relations – Engagement, Motivation
Many empirical studies and motivational theories suggest that highly motivated employees lead to
high organization effectiveness, which then improve the overall performance of an organization
(Bass, 1960; Goleman, 1998; Preston et al, 2015). Motivation comes from many forms, employee
engagement, internal development, training, restructuring and many other strategies increase
employee motivation. MAB communicated its internal development plan and strategies with
stakeholders via an annual report, employee engagement as well as e-media as part of its internal
communication.

6
“A great place to work, play and perform” is one of the mission statements that inspire the
employees of MAB. The firm regularly communicates its initiatives about organizational
development, employee development program, learning, recognition and award, employee’s
welfare and benefits as well as remuneration package (MAS “Annual Report”, 2014). As a result,
it improves employee’s performance as well as employee’s loyalty. In a recent achievement of the
airline where they recorded the first monthly profit (February 2016), the CEO, Christoph Mueller
dedicated the achievement to his team by mentioning the contributory factors is due to increased
employee engagement that leads to increased overall performance of the airline (Business Insider
“MAB turned its first monthly profit”, 2016).
1.3.1.2 Crisis Communication and Reputation Management
The disappearance of MH370 and the downing of MH17 have put the national carrier and the
country in the highlights of the world. The twin tragedies have put the entire organization as well
as the entire nation to unite to face the challenge. Flight cancellations, fear of flying, brand damage,
employees demoralize and financial impact are the immediate consequences of the twin tragedies.
The MH370 is still a mystery until today and the MH17 has been dubbed as unlucky but innocent.
According to Coombs (2015), crisis communication seeks to prevent or lessen the negative
outcomes of a crisis by protecting the organization, its stakeholders, and the industry from harm.
The relentless support from the Prime Minister of Malaysia and the Government have helped the
firm to go through the turmoil and rebuild the brand reputation. The airline has taken all necessary
steps to rebuild its reputation such as setting up periodically press conference, constantly
communicate through social media platform, as well as providing moral support to the family
members of the victims and the crew. An interview with the former Head of Marketing, Dean
Dacko mentioned that the firm took seven weeks and seven days from blackout to recover from
MH370 and MH17 tragedies respectively (Mumbrella, “Dean Dacko Interview”, 2015). Today,
with all the hard work, Malaysia Airlines are back flying high with better and improved financial
performance.

7
1.4 Zeta Firm
Jackson (2004) states that Zeta firm lives and operates via three-dimensional concept – economics,
law and reputation. The rule of thumb requires Zeta firm finding the right balance among the
dimensions of commerce (economics), compliance (law) and credibility (reputation). Jackson
(2004) highlights that Zeta firm lives in a “Realland” as a living organism and competing in a
dynamic environment. Apart from focusing on profit maximization and protecting the public
interest (law), the third important element is managing stakeholder relations through reputation
management. (Fombrun and Van Riel, 1997, 2004; Freeman et al, 2010) state that stakeholder
decisions towards an organization are affected by the level of reputation which the organization
possessed. According to Freeman et al (2010), stakeholders refer to 1) suppliers, 2) shareholders,
3) environment, 4) employees, 5) community and, 6) customers. In a study conducted by Ma
(2012) suggests that managing stakeholder relationships have become an important objective in
every organization today.
With the advent of technology, Internet, social media, globalization, and empirical studies
and findings on CC management, it is imperative for organizations to embrace the knowledge and
rapidly build their corporate reputation. Fombrun and Van Riel, (1997, 2004) highlight that strong
positive reputation is one of the important sources for an organization to be different from its rivals,
an important asset that rivals can’t easily imitate (Dierickx and Cool 1989; Rumelt 1987).
As described, private sectors are best to illustrate the Zeta firm characteristics. The main
goal of a private sector firm is a long-term business and profit. There are many reputable firms
from different business segment out there can exemplify Zeta firm but the most outstanding
popular brand today in Malaysia is AirAsia, the low-cost carrier. There are so much to mention
about the firm in particular. In the following section, will highlight and discuss how the firm
perform, manage its stakeholder relationship, build, and sustain its corporate reputation.
Technology is the turning point for AirAsia in generating revenue. Next, will discuss some
evidence of “giving-back” to the society and lastly a brief discussion on how the firm reacts to
reputation restoration post #QZ8501 incident.

8
1.4.1 CC – The case of AirAsia
While other airliners were struggling to compete with each other in a competitive airline industry,
a new-entrant enter the market to make a difference in 2001. A new local firm, Tune Air took over
an existing domestic airline called AirAsia for RM1 together with millions of Ringgit debts. After
about 11 months, the airline made full payment of the debt (Poon & Waring, 2010). Since then,
AirAsia never looked back and continue to make remarkable impact. Besides the founder and the
management team that contribute the success, the other significant contributory factor is its
strategic corporate communication and stakeholder relationship management.
1.4.1.1 Technology influenced CC (Commerce)
AirAsia heavily relies on technology for its business, as well as disseminating and communicating
with its customers. The approach of B2C (Business to Customer) model and the Internet allow the
firm to pioneer the online ticketing system which reducing the use of the conventional physical
distribution channel. As a result, the airline generated higher revenue from online sales through its
corporate website (Poon & Waring, 2010). The firm also extended the use of the Internet to provide
online customer support via email, online chat and social media. Apart from front-end system, the
firm also deployed powerful backend system to facilitate the internal operations. The heavy
investment has increased efficiency of the overall process, increase “Allstars” (employee)
satisfaction, customer experience and ultimately increase the overall performance of the firm.
1.4.1.2 Give back – CSR (Law)
Awareness and implementation of CSR are relatively new in Malaysia. CSR starts to take place
after implementation of policies and initiatives by the federal government and its agencies
(Sharma, 2013). It is now becoming mandatory for GLCs, and public listed companies to report
their CSR initiatives in the annual financial report. Firms consider CSR today as important to not
only for organization's reputation, but also for financial results (Lu & Castka, 2009).
In this spectrum, AirAsia participated in many CSR activities like #GREEN24, relief
efforts, football coaching clinic for young development and much more. The #GREEN24
campaign is about environmental sustainability and consciousness. In 2015, AirAsia launched the

9
campaign for all “Allstar” and to the general public. Over the years, AirAsia has provided use of
its aircraft to facilitate humanitarian aid and natural disaster relief efforts. The firm commitment
is also extended globally, for instance the Nepal devastating earthquake on April 2015. In terms
of youth development in sports, especially, football, AirAsia also conducted football coaching
clinics together with English football club, QPR over three countries, Malaysia, Singapore and
Thailand (AirAsia “Annual Report”, 2015).
1.4.1.3 #QZ8501 Disaster - Crisis Management
They say lightning never strikes twice, but three aviation disasters in 2014 involving Malaysia.
After the disappearance of MH370, the downing of MH17 and in December 2014, Indonesia
AirAsia, QZ8501 crashed into the Java Sea killing all passengers. The incident puts AirAsia in a
major crisis. If they fail to manage the situation well, it will further damage the image and
reputation of the firm. How AirAsia and the Group CEO, Tony Fernandes handles the crisis were
with full of respect (Newshub “Lessons from the infamous QZ8501”, 2014).
Tony Fernandes and his team use media strategy, particularly social media – Twitter to
frequently communicate with the public. The victim’s families are given continuous updates
through Tony Fernandes’s Twitter account. He assures the passengers and crew are his priority
and promised them to do his best to provide any form of support. Comparing the crisis management
between MAB and AirAsia, the latter handles it much better and well organized (Masduki, 2015).
The strategies and action taken by AirAsia in handling post-crash public communication
have successfully restored its strong brand reputation within a short period. The airline quickly
puts the incident behind them and continue pursuing its vision “to be the largest low-cost airline
in Asia”.
1.5 Conclusion
In sum, although Alpha, Omega and Zeta firms are differentiated by certain characteristics as
discussed above, they have one thing in common which is the stakeholder communication activity.
They rely on all three dimensional concepts to build their sources of sustainable competitive

10
advantage. These sources will become their strengths that enable them to compete with other
competitors in the marketplace. Subsequently, a sustained competitive advantage will improve the
overall performance of the company in a long run.
2. RQ – Reputation Quotient, the case of SMEs in Malaysia
2.1 Introduction
Small and medium-sized Enterprise (SMEs) have been regarded as one of the major contributors
to economic growth in all countries. In Malaysia, 90% of the business enterprises are SMEs from
various industries. As reported on the SME annual report, the contribution of SMEs to overall
Gross Domestic Product (GDP) increased significantly to 35.9% in 2014 and the total number of
establishments as reported is more than 600,000 SMEs in Malaysia today (SME Annual Report,
2014/2015). The numbers may increase or decrease depending on how these SMEs survive in the
challenging and competitive market. Among others, establishing a corporate reputation is one of
the important key areas for these companies to outperform their rivals.
Fombrun (1996) provides the most cited corporate reputation definition as “a perceptual
representation of a company’s past actions and future prospects that describes the firm’s overall
appeal to all of its key constituents when compared with other leading rivals”. Charles Fombrun
also suggested that corporate reputation can be measured and therefore he developed a structured
assessment instrument concept called Reputation Quotient (RQ) (Fombrun &Van Riel, 2004). The
instrument asks respondents to rate an organization on twenty attributes, which are then formed
into six dimensions as shown on Figure 2.1. The total score will determine the overall reputation
of an organization which can be used as a source of competitive advantage, something which is
difficult for rivals to imitate. In the following sections will discuss how SMEs in Malaysia use
reputation to shape up their business based on these dimensions.

11
Figure 2.1 – The six dimensions of RQ (Fombrun &Van Riel, 2004).
2.2 Six dimensions
The six RQ dimensions are as follows;
2.2.1 Emotional Appeal
Emotional appeal means stakeholders have good feelings about the company, trust the company,
admire and respect the company. Fombrun & Van Riel (2004) suggested that emotional appeal has
direct relation to the other five dimensions - products and services, workplace environment, social
responsibility, vision and leadership, and financial performance. Ratings for each dimension

12
contribute to the emotional appeal ratings, which then creates the overall reputation of the
organization. Matter of fact, emotion is known to be the primary driver of reputation.
Apart from the five dimensions that influence emotional appeal, corporate logo and
corporate identity create an emotional bond to the stakeholders too. According to Hilton (2009)
logos are becoming much simpler and more conversational. “They are not yelling; they’re inviting.
They convey more emotion”. Using Secret Recipe as an example, the logo is just a text represents
the business and the brand name as shown on Figure 2.2. The theme color used by the business is
red. From corporate website to its outlet interior design, the color is based on red. There is no
significant reason for the choice of color, but in Chinese culture, red represents lucky color. These
elements create the underlying identity, image and brand of the firm. Since 1997, the firm has won
the heart of the Malaysian. Customers trust the brand to the extent that they will associate Secret
Recipe brand with any event especially birthday celebration.
Figure 2.2 – Secret Recipe corporate logo
2.2.2 Product and Services
Highest and finest product quality is utmost important to the business owner and stakeholders. For
business owners, they can charge better price when the product is superior (Jackson, 2004) and for
customers, they will repeat transactions, or to recommend to family members and friends through
positive feedback via word of mouth, blog and social media (Yu et al, 2006). Besides quality,
stakeholders generally seek for innovativeness, reliability, consistency and value for money. Using
Secret Recipe as an example, there is no doubt on the consistency of taste and quality of its cakes.
From own personal experiences, the taste of Secret Recipe’s cakes is consistent regardless of where
or which outlet the cake is bought.

13
Secret Recipe is one of the successful franchise business as reported in SME annual report
(2014/2015). The comprehensive training program is known to be the important factors for its
superior and excellent service. Training is provided by the franchisor to the chef, pastry chef and
the waiter/waitress. The objective of the training is to ensure uniformity of skills and service
quality across all franchises. In summary, highest, superior and finest product and service quality
satisfy stakeholder’s expectations of product and service delivery on a consistent basis. Being
consistent is what the business needs for a real reputation.
2.2.3 Vision and Leadership
Creating a vision, mission statement is one of the important steps in formulating strategic planning.
It looks like a simple task, but to create a clear, meaningful and simple yet inspiring vision
statement is not easy. Vision is generally seen as a picture of the future. Vision guides and
perpetuates corporate existence (Papulova, 2014). Some business leaders invest thousands of
dollars hiring experts to ensure they have a powerful vision statement.
Once vision is developed, the leaders must first champion the vision before others. A
transformational leader will then communicate the vision to all employees, get them to believe,
inspired, and transform them towards the corporate vision. Secret Recipe’s aspiration is “to become
the leader in fine quality cakes, fusion food and distinctive service”. Today, the reputation they
portray has made the business as the leading and largest café chain in Malaysia.
With more than 400 cafes throughout Asia region, it is expected that more franchisee to
sign up and expand the business not only in Malaysia but also in Asia. As reported by Maldives
Government website (2016), in April, the President launched the first restaurant in the country
located at Male. The café can also be found in prime urban locations and shopping malls in major
cities including Singapore, Indonesia, Thailand, China, Brunei, Cambodia and Myanmar.
Ambitious, authentic and inspiring vision, and supported by good leadership team have created a
solid reputation of Secret Recipe which is hard for its rivals to replicate (Dierickx and Cool 1989;
Rumelt 1987).

14
2.2.4 Workplace Environment
A unique corporate culture with conducive workplace environment have become relatively
important for prospect employee assessing their future employer as well as an important factor for
an employer as part as their employee retention program. Through social media, people are
exposed to international companies like Google, Apple and Microsoft where the working culture
is seen to be more enjoyable with many facilities, gadgets, free food and drinks. Every employee
wishes or dream to have a same environment or culture like what they have seen on the internet.
As many researchers link reputation to image, and the image is derived from the internal
of the company and based on the organization’s culture. It consists of current practices, history,
values and behavior (Melewar, Karaosmanoglu & Paterson, 2005). Earlier on, Alsop (2004)
suggested that company that creates a conducive environment for all their employees contribute
greatly to corporate reputation. This notion was well supported by Fombrun (1996) where he
suggested that employees would like to work in an environment where trust is promoted,
employees are empowered and the company inspires pride. Today, in some industries in Malaysia
like ICT, the culture is more or less the same like western IT companies in the Silicon Valley.
From training and development perspective, SMECorp Malaysia organizes many training
programs for SMEs to take part. The training includes soft skills training for SMEs employees,
which is scaled up to more technical training for them to stay current with technology and to stay
competitive in the marketplace (SME “Annual Report”, 2014/2015). Through support from the
Government, many SMEs are now able to upgrade their skill sets which then improve effectiveness
and productivity of the firm. Efficiency and organizational effectiveness, improve corporate image
which then increase corporate reputation in total.
2.2.5 Social and Environmental Responsibility
Although CSR is considered new in Malaysia but most organizations, including SMEs have
indirectly engaged in CSR practices long time ago. A research conducted by Hasnah Haron et al
(2015) states that SMEs in Malaysia start socially responsible with their own employees before
with other stakeholders 1) suppliers, 2) shareholders, 3) environment, 4) community 5) customers
(Freeman et al 2010). Today, CSR has become one of the most important agenda in every business

15
with respect to reputation building. The objectives of CSR include safeguard, and ensure the
company’s reputation is increasing among its stakeholders (Witte and Reinicke, 2005).
In Malaysia context, publicity of social responsibility among SMEs is relatively low.
Thanks to government agencies, NGOs and local newspapers for organizing campaigns and
recognition award for SMEs companies that have made an impact in CSR development. Among
others, awards like STAR Business Award (SOBA) organized by Star Publication (M) Berhad
(CSR Award) (Figure 2.3), SME Recognition Award from SMI Association of Malaysia (The
SME Social Responsibility Excellence Award) and many more (The Star, “SOBA” 2014). Such
campaigns and awards have indeed promoted CSR development in Malaysia and at the same time
recognize the contribution of participants to the society and the environment.
According to Murray (2003), through CSR practices, it increases corporate image and
brand awareness of the firm for long term success. Ultimately, this will increase corporate
reputation among stakeholders. Although most SMEs in Malaysia practice small-scaled CSR
activities like visiting Old Folks Homes, Orphanages and organizing blood donation campaign,
the efforts are still counted as “Doing Good to Do Well” (Vogel, 2005). Robert & Dowling (2002)
also suggested that an organization with a good reputation is also good at sustaining huge profits
in a long run.
Figure 2.3 The Star SOBA (http://www.soba.com.my)
2.2.6 Financial Performance
Corporate reputation and company’s financial performance are directly correlated. Many
researchers including Robert & Dowling (2002), suggested that firms with a strong reputation
encourages shareholders to invest in the firm, it attracts good staff, improves sales, retains

16
customers, which in turns improve the overall financial performance of the firm. In 2014, Fosun
International Limited of Shanghai invested RMB210.5 million or approximately USD30 million
in Secret Recipe Malaysia and become the second largest shareholder in the company (Fosun,
2014).
For the past decade, the company has demonstrated good financial performance record and
the new investment deal will be used for business expansion and growth in China. Together with
a reputation of largest café chain in Malaysia and presence in ten countries in Asia region, the
investor is optimistic the firm will do well in China as well. For the firm, the investment deal is
seen as a big opportunity for the firm to penetrate large market like China as well as it strengthens
the financial status of the company.
In terms of human capital resources, organizations with strong financial performance attracts
good staff. Secret Recipe from a different angle, attracts new franchisee to venture the franchise
business. Public or potential franchisee sees good prospect of the business and they are eager to be
the next successful business owner. In a different perspective as reported in the SME annual report
(2014/2015), baby business particularly cloth diaper business is booming. Conventional diapers
are very expensive, with the introduction of cloth diapers for RM50 a piece which can last for six
years has attracted more people to join and support the company which now has nice retail outlets.
The firm may not be at par with Secret Recipe yet, but stakeholders believe and perceive this
business has very strong potential. Under financial performance dimension, it covers many factors
and also can be viewed from different angles as briefly discussed above.
2.3 Conclusion
The RQ concept as developed by Fombrun & Van Riel (2004), is an important baseline for
managing reputation and identifying new market risks, measures companies’ reputation strengths
based on stakeholder perceptions across attributes that classified into six corporate reputation
dimensions. Among the six dimensions, emotional appeal is known to be the primary driver
for corporate reputation in many industries. Apart from corporate image and identity discussed in
Secret Recipe’s logo that create emotional bond, studies reveal some other emotional appeal
factors like “trust” and “respect” increase the overall corporate reputation.

17
Although many researchers agree that CSR is good for corporate reputation building, some
researchers argue and against the idea of taking part in CSR activities. Milton Friedman (1970)
argues that the ultimate goal of an organization is to maximize profit and leave social
responsibilities to local authorities like government agencies, NGOs and so forth. However, how
business leaders perceive the rationale of contributing in CSR nowadays have changed the
landscape. Corporations have joined the efforts by the government to be socially responsible as
well.
In summary, every corporation regardless of size must continuously build their own
reputation. Reputation building starts from the inside of the company - employees, corporate
culture, internal processes, communication, leaders, behavior and so on. From the discussion, we
may conclude that reputation is an intangible asset that affects the overall company’s situation. It
has powerful influence that can help or hinder a company competing with its rivals.
[Word counter - 5131]

18
References
AirAsia “Annual Report”. (2015). Retrieved from http://www.airasia.com/docs/common-
docs/investor-relations/annual-report-2015.pdf
Alsop, R. J. (2004). The 18 Immutable Laws of Corporate Reputation. New York: Free Press.
Argenti, Paul A. (1996). Corporate communication as a discipline: Toward a definition. In:
Management Communication Quarterly, Vol. 10, no. 1, p. 73-97, August 1996, Sage
Publications, Inc.
Argenti, P. A. (2006). How Technology Has Influenced the Field of Corporate Communication.
Journal of Business and Technical Communication, 20(3), 357-370.
doi:10.1177/1050651906287260
Bass, B. M. (1960). Leadership, Psychology, and Organizational Behavior.
Business Insider “MAB turned its first monthly profit”. (2016) Retrieved from
http://www.businessinsider.com/ap-ceo-says-malaysia-airlines-has-first-monthly-profit-in-
years-2016-4?IR=T
Cornellissen, Joep (2008). Corporrate Communication: a guide to theory and practice. 2nd
edition, London: Sage, 2008
Coombs, W. Timothy: Ongoing Crisis Communication: planning, managing and responding. 4th
edition, Thousand Oaks: Sage, 2015responding. 4th edition, Thousand Oaks: Sage, 2015
Dierickx, I., & Cool, K. (1989). Asset stock accumulation and sustainable competitive
advantage. Management Science, 35, 1504–1511.
Friedman, (1970). The Social Responsibility of Business is to Increase Its Profits: The New York
Times Magazine, September 13.
Fombrun, C. J. (1996). Reputation: realizing value from the corporate image.Boston: Harvard
Business School Press.
Fombrum, C.J. and van Riel, C.B.M. (1997) The Reputation Landscape. Corporate Reputation
Review, 5-13. http://dx.doi.org/10.1057/palgrave.crr.1540008
Fombrun, C. J., & Van Riel, C. B.M. (2004). Fame and fortune: how successful companies build
winning reputations. New York: Prentice Hall.
Fosun (2014). Retrieved from
http://web.archive.org/web/20160404124543/http://www.fosun.com/en/news/detail.html?id
=1401
Freeman, E., Harrison, J. S., Wicks, A. C., Palmar, B. L., & De Colle, S. (2010). Stakeholder

19
theory. The state of the art. NY: Cambridge University Press.
Goleman, D. (1998). A Theory of Leadership Effectiveness. Working with Emotional
Intelligence. Bantam.
Griffiths, M., & Mclean, R. (2015). Unleashing corporate communications via social media: A
UK study of brand management and conversations with customers. Journal of Customer
Behaviour J. Cust. Behav., 14(2), 147-162. doi:10.1362/147539215x14373846805789
Haron, H., Ismail, I., Oda, S., Jalil, A. A., & Ishak, N. K. (2015). Ethics and Corporate Social
Responsibility of Small and Medium Enterprises in Japan-Lessons Learnt. Adv Sci Lett
Advanced Science Letters, 21(4), 947-952. doi:10.1166/asl.2015.5947
Hilton, J. (2009). What does your logo SAY ABOUT YOUR BRAND?. Functional Ingredients,
(92), 34.
Jackson, K. T. (2004). Building reputational capital. New York: Oxford University Press.
Lu, J. Y., & Castka, P. (2009). Corporate social responsibility in Malaysia – experts' views and
perspectives. Corporate Social Responsibility & Environmental Management, 16(3), 146-
154. doi:10.1002/csr.184
Ma, J. (2012). A study on the models for corporate social responsibility of small and medium
enterprises. Physics Procedia, 25, 435–442. doi:10.1016/j.phpro.2012.03.108
Malaysia Airlines, (2014). “Annual Report”.
Maldives, (2016). “President Launches Secret Recipe Restaurant” Retrieved from
http://www.presidencymaldives.gov.mv/Index.aspx?lid=24&aid=3306
Masduki (2015). Crisis Communication A Comparative Analysis of Brand Recovery Strategy
Between Malaysia Airlines and AirAsia after the Crash of MH370 and QZ8501
Melewar, T. C., Karaosmanoglu, E., & Paterson, D. (2005). Corporate identity: concept,
components and contribution. Journal of General Management, 31 (1), 59-81.
Minhat, M., & Abdullah, M. (2014). Executive compensation in government-linked companies:
evidence from Malaysia. Applied Economics, 46(16), 1861-1872.
doi:10.1080/00036846.2014.887192
Mumbrella, “Dean Dacko Interview”. (2015). Retrieved from
http://www.mumbrella.asia/2015/03/malaysia-airlines-marketing-chief-dean-dacko-on-the-
mission-to-get-the-brand-flying-again/
Murray, A. (2003). CSR in the EU Centre for European Reform: London.
Newshub “Lessons from the infamous QZ6501”. (2014). Retrieved from https://www.the-

20
newshub.com/international/crisis-management-lessons-from-the-infamous-airasia-qz8501
Papulova, Z. (2014). The Significance of Vision and Mission Development for Enterprises in
Slovak Republic. JOEBM Journal of Economics, Business and Management, 12-16.
doi:10.7763/joebm.2014.v2.90
Poon, T. S., & Waring, P. (2010). The lowest of low-cost carriers: The case of AirAsia. The
International Journal of Human Resource Management, 21(2), 197-213.
doi:10.1080/09585190903509480
Preston, G., Moon, J., Simon, R., Allen, S., & Kossi, E. (2015). The Relevance of Emotional
Intelligence in Project Leadership. Journal Of Information Technology & Economic
Development, 6(1), 16-40.
RMK 11. (2015) Retrieved from http://rmk11.epu.gov.my/book/eng/Elevent-Malaysia-
Plan/RMKe-11%20Book.pdf
Roberts, P. & Dowling, G. (2002). Corporate reputation and sustained superior financial
performance. Strategic Management Review 23, 1077-1093.
Rumelt, R. (1987). Theory strategy and entrepreneurship. In D. Teece (Ed.), The competitive
challenge: Strategy for industrial innovation and renewal (pp. 137–157). Cambridge, MA:
Ballinger.
Sharma, B. (2013). Contextualising CSR in Asia: Corporate social responsibility in Asian
economies. Singapore: Lien Centre for Social Innovation.
SME Annual Report. (2014/2015). Retrieved from
http://www.smecorp.gov.my/index.php/en/resources/2015-12-21-11-07-06/sme-annual-
report/book/7-annual-report-2014/2-annual-report
The Star “MAS New Structure” (2015). Retrieved from
http://www.thestar.com.my/business/business-news/2015/07/03/mueller-unveils-a-flat-mas-
structure/
The Star “So long, Ah Long syndicate” (2016). Retrieved from
http://www.thestar.com.my/news/nation/2016/05/24/so-long-ah-long-syndicate-cops-bust-
one-of-the-biggest-rings-in-the-country-within-12-hours/
The Star “SOBA” (2014). Retrieved from http://www.thestar.com.my/business/business-
news/2014/10/16/soba-relevant-to-sme-growth-companies-can-upgrade-ops-based-on-
judges-feedback/
Van Riel, Cees and Charles Fombrun. Essentials of Corporate Communication. Abingdon, UK:
Routledge, 2007.
Vogel, D. (2005). The Market for Virtue: the Potential of Corporate Social Responsibility.
Washington: Brooking Institution Press.

21
Wei-Hin, C., Kadzrina Abdul, K., & Abdul Manaf, B. (2014). THE STRATEGIC PLANNING
OF SMES IN MALAYSIA: A VIEW OF EXTERNAL ENVIRONMENTAL SCANNING.
International Journal Of Business & Society, 15(3), 437-446.
Witte, J. M. and Reinicke, W. H. (2005). Business UNusual: Facilitating United Nations Reform
Through Partnerships. United Nations Global Compact Office, New York,
Yu, C.H, Chang, H.C., and Huang, G.L. (2006),"A study of service quality, customer satisfaction
and loyalty in Taiwanese leisure industry", Journal of American Academy of Business,
Cambridge, Vol. 9 No. 1, pp.126-132.

Corporate Communication, RQ - May 2016

More Related Content

What's hot

Viewers also liked

Similar to Corporate Communication, RQ - May 2016

More from Helmee Halim

Recently uploaded

Corporate Communication, RQ - May 2016