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Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

BRBB
ASSIGNMENT 2
Brand and Brand Building: Systemic Leadership Essay
Capitecs Gerrie Fourie
Kimbal Stokes
14018377

12 February 2016

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

We are currently living in a connected world, one where the speed and
immediacy of a global village infiltrates the daily agenda of the public and private
sector. Traditional means of the planning, structure and performance of certain tasks
has become compromised as our world is increasingly fragmented. Fragmentation,
paradoxically, is occurring at a rate of increased interconnectedness (Lundestad,
2004). With the emergence of new markets, which is happening exponentially as
interconnectedness from information technology becomes further entrenched in
society, with their own specific prerequisites, philosophies and desires, a saturateddilution occurs resulting in weakened effectiveness of mass-marketing and a
corrosion of brand-loyalty (O'Hara, 2011).
For example when a glass of water has ink added to it, the water becomes colored
with that ink. It takes a small amount of ink to render the water no longer translucent.
However, when a glass of ink has water added, it takes massive quantities of water
for the ink to become non-existent changing the need for a glass to a swimming
pool. The latter situation is an example of fragmentation, when the glass of ink is
untouched it is rich and deep with color and meaning like a market without
fragmentation. Subsequent to the pouring of water (intercommunication
technologies), slowly the ink loses color and meaning becomes washed out and
unidentifiable while it gets moved to a large and unfocused container, a swimming
pool (our global village).
In this swimming pool of colorless water, traditional methods of creating meaning in a
brand no longer works as it did when there was only a glass. In this sense, the
classic model of brand management must be adapted and brands reconstructed to
allow meaning to become once again inserted; without compromising the benefits
offered by intercommunication technologies. In other words, ink of a different color
should be poured pack into the swimming pool. This re-inking would be done by
migrating from McElroys Classic Model of brand management to a Brand
Leadership Model, i.e from a tactical and reactive model to a model that is strategic
and visionary (D. Aker and E. Joachimsthaler, 2009).
Adapting the model would, in theory, prioritize the creation of meaningful brand
identity that can become effectively communicated to the consumer. Nonetheless, an
additional action would be required other than changing the model. That is a change
in perspective.
This change of perspective would be from a pure reductionist view to a combination
between a reductionist and a connectivist (Taylor, 2000). In other words, a shift from
a parts perspective with distinct boundaries, linear casualty, an adherence to

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

incremental change and belief in controllability to something where a whole system


perspective, with blurred boundaries, a non-linear casualty, dynamic flux, and a belief
in broad influence rather than incremental changes (Taylor, 2000, p. 6) is imperative.
Everyday companies get blind sided by the future. Everyday dozens of
organizations find themselves suddenly on the defensive, struggling to adapt
to a decrepit business model to someone elses business concept
innovation.
- Gary Hamel (Hamel, 2002)
Hamels quote paints a picture of a dystopian future market, where companies lose
faith in the comfort of effective business strategy. The future of the brand does not
need be one of confusion, dissolution and the disenchantment with brand. Yes,
business strategy is no longer the comfort it once was and yes, no longer can an
organization simply be reactionary and tactical, but this does not mean a defensive
approach is needed in adapting to someone elses model. No. What is needed in
order to not get blind sided by the future is simply identity.
A strong brand identity and a brand leadership model go hand in hand. Without the
one, the other becomes superfluous and ineffective (D. Aker and E. Joachimsthaler,
2009); minus a personalized brand identity, the effective adaption to a brand
leadership module cannot gain synergy in an increasingly fragmenting world and,
without the adaption to the brand leadership model, effective brand identity cannot
gel with the fragmentation presented by interconnected technology.
To see this in effect, this complex relationship between fragmentation and effective
business strategy for the future (a bright future, not Hamels) is to understand the
challenges presented to achieve brand leadership. Simply put, there are 4 challenges
as outlined by David A. Aaker in Brand Leadership (2009).
1.
2.
3.
4.

The Organizational Challenge


The Brand Architecture Challenge
The Brand Identity and Position Challenge
The Brand Building Program Challenge

Understanding these challenges will not be effective without fully comprehending


Aakers points of separation between McElroys Classic Model and the Brand
Leadership Model (D. Aker and E. Joachimsthaler, 2009). These points of separation
are based on the concept that the Classic Model is outdated, and no longer has the

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

suitable legs to stand the test against this increasingly fragmented market. There are
three groupings to these points:
1. From tactical to strategic management
2. From limited to broad focus
3. From sales to brand identity as the driver of strategy
In addition to Aakers points of separation, this paper will argue that an organization
needs more than simply an adaptation of business model but also a switch in
perspective. Illustrating this would require Carl Taylors Systemic Leadership (2000),
and his identification of the connectivists and reductionists difference in
organizational perspective. Furthermore, the paper would argue a combination of the
two perspectives as paramount to avoiding Hamels dystopian future; the two are not
mutually exclusive (Taylor, 2000, p. 8) but rather require a balancing of the tensions
of the two. Taylor creates a series to best represent tensions between reductionist
and connectivist outlooks. These tensions appear when we contrast what is
expected by tradition and with the realities of what we experience (Taylor, 2000, p.
7). These tensions are

fig. 1 (Taylor, 2000, pp. 7-8)


In order to illustrate these various arguments, one would need to outline a brand
which has practically succeeded in adapting a business model from the McElroys
Classic Model to the Brand Leadership Model, and whos integration of perspective
from the traditional reductionist or a connectivist one to a management of tensions
between them.
Under the leadership of the new CEO Gerrie Fourie Capitec has emerged as a
motivated brand in the seemingly Big4 (First National Bank, Standard Bank, ABSA

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

Bank and Nedbank) dominated South African banking industry, which has become a
market not necessarily fragmented as described previously, but rather stagnant as
the dominance of the Big4 corner the market, making space for a new brand to
emerge in South African banking difficult.
Fouries predecessor, Riaan Staasen, founded Capitec bank and fostered its
foundation under a Classic Model by being tactical and reactive in his approach
(Bonorchis, Capitec proves critics wrong, wins customers over in droves, 2015). Not
failing in his task to create a foundation, the tactics of delivering single products and
markets, remaining simple and focusing on a single brand image meant Capitec
failed to merge into the new market reality (in a general sense, not specifically in a
South African banking one). The result was the continued obscurity of Capitec
against the behemoth Nedbank, Standard, ABSA and FNB banks. Not necessarily a
failure, but the inability to hold ones own as a brand allows for a continued projection
into obscurity amongst customers. However, Fouries introduction as CEO in 2013
(Capitec, 2014) meant an introduction of values to Capitec that made a customercentric brand identity a possibility. These values are namely the sustained
conveyance of friendly, simplified and pioneering banking, with a strong inclination in
pioneering innovation to meet the customers everyday needs.
Innovation is not just technology. Yes it is part of it, but its much more ()
pioneering concepts, which hadnt been seen anywhere else in South Africa,
meant my job is to build further on these successes and to steer new and
Customer innovations that will improve the lives of our clients
-

Gerrie Fourie (2013)

This introduction has allowed for strong growth rates, increased customer relation
and greater brand awareness. The above noted difference between Staasan and
Fouries leadership modules illustrates the ease at which Fourie has navigated the
systemic leadership role, and the mastery of adaptation between models and an
example of Aakers three groupings, (i) tactical to strategic management, (ii) limited
to broad focus, (iii) from sales to brand identity as the driver of strategy.
Unpacking business leader Gerrie Fouries, who incorporates a systemic approach to
leading, contributions to Capitec is to analyze his response to the 4 challenges set
out by Aaker, and to understand how he navigates the tension between Taylors
connectivist and reductionist outlooks.
1. The Organizational Challenge

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

The organizational challenge is the difficulty in establishing a brand nurturing


structure where the sharing of ideas, experiences, and brand building initiatives
becomes paramount to the stability of the organization and its ability to exist on
synchronized collaboration. This is done by establishing and fostering a
communication system that provides (i) a common vocabulary, and (ii) common
output and input. This is all achieved by fostering a unified brand identity. However,
the construction of this organization comes second to the establishment of its head.
The head is someone who has a long-term commitment to the organization and not a
vested interest generated by a short-term stay. The long term aspect creates a
future looking perspective, since the past has established a timeline of
understanding and passion with the company. Additionally to a long term, the
candidate should have sufficient knowledge of the working of the organization, either
by directly creating its structure or by having first hand experience of the function of it
(D. Aker and E. Joachimsthaler, 2009, p. 26).
Gerrie Fourie has worked for Capitec from its foundation years in 2000, working
alongside the previous CEO Riaan Staasen in the construction of the brands
organization (Bonorchis, Gerrie Fourie named as new Capitec head, 2013) and had
been expected to supersede Staasen once his leadership had run its course, which
it had. His organizational challenge response was to create a brand identity that the
majority of those who existed in the structure, all forms of its structure from
horizontal (industry) to vertical (client position), could rally behind externally and
internally. The result is a unified organization that shares a clear vision, the delivery
of friendly, simplified and pioneering banking () with an even stronger focus on
innovation and meeting the clients needs (Capitec, 2014).
2. The Brand Architecture Challenge
Brand architecture refers to the identification of brands and subbrands that are to be
supported, their respective roles and their relationship with the customer. The role of
each brand should be determined and their relationship to each other and the brand
ID rendered paramount. A successfully conceived architecture, and therefore the
challenge, will bring clarity to customers, real synergy between the brands and the
communication programs themselves, and the ability to leverage assets.
Gerrie Fourie has considered carefully what points should the Capitec brand stretch
in terms of the products it could offer, its expansion into other geographies other than
South Africa and additionally its creation of a sub brand (Fourie, After another strong
year Capitec CEO sees lots more growth to come, 2014).

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

3. The Brand Identity and Position Challenge


As previously stated in the paper, there is no Brand Leadership model with an
ambiguous or confused brand identity. The reason for this is it communicates to
customers, external and internal organizations, other sub brands, and it distinguishes
the organization from competition (including its products, offerings and services
themselves), if the brand identity is confused the listed benefits wouldnt come
through in the brands favor but instead only increase market fragmentation. In other
words, no synergy and focus or the ability to cross manage in the splintering
globalized platform.
Capitecs ability to maintain its brand identity, as described in 'The Brand
Architecture Challenge portion of this paper, whilst fostered by Fouries vision for the
brand itself has filtered down the organization creating exactly unity/synergy, but
more importantly distinguishes it from competitors. The focus on consistent value,
and the clients ability to know what they get and know what they pay (Capitec,
2014, p. 1) has fostered a relationship between Capitec and its customers one of
trust, transparency and an adherence to customer-centric products.
4. The Brand Building Program Challenge
Considering Fouries success in the previous challenges, it is important to note his
ambiguity in this particular challenge. The Brand Building Challenge is to realize the
brand identity building programs that are needed, and to implement in order to define
the brand identity. When focusing on Capitec, to the capacity that this paper has
done, its easy to identify the brand identity since the proximity and research needed
would put this forefront. External and internal organizations would, too, have this
forefront due too proximity as well. Already garnered clients would also know the
brand identity. However, whether its due to Fouries inability to identify exactly what
brand programs are needed or if its the effect of the market domination by the Big4,
Capitec seems to lack the exposure needed to bring in new clients.
Aaker outlines that execution elements of the brand building challenge makes
strategies more vivid, less ambiguous and provides confidence in new and existing
clients. Aaker also goes into detail on the level of execution needed, emphasizing the
need for brilliance and not just a level of good. Since brilliance needs to cut through
existing strategies and programs, not only by competitors but by the organization
itself, reinforcing attitudes and deepening customer relationships. In an interview with
Alec Hogg for Biznews (2015) Fourie outlines that they have hit a wall in this sense
(Fourie, Capitec CEO Gerrie Fourie: Sparkling results but do they justify 150% share

Kimbal Stokes

Systemic Leadership: Gerrie Fourie

1/4/2015

price surge?, 2015). Nonetheless, he has also identified that the customer-centric
approach Capitec and himself has taken will inform their brand-building programs,
() However, we stick to our game plan. From the beginning, we said we
want to do a couple of things such as building our brand
- Gerrie Fourie (2015)
Fouries success in addressing the challenges associated with having an effective
organization that functions under the systemic leadership model, eases the tension
between the reductionist and connectivist leadership outlooks. His experimentation,
although informed, edges onto an expectation of first time perfection. However, this
hedges on the reductionist edge, contrastingly the setting of goals he manages to
create responds to a market that is permanently influx whilst not making promises
his organizational structure cannot keep (Taylor, 2000). Capitecs goals have been
met, whilst over achieving in other aspects. Their market growth continues whilst in a
time of bank unreliability (referring here to the downfall of African Bank) (Bonorchis,
Capitec proves critics wrong, wins customers over in droves, 2015), their ability to
tow the tension line between a conservative/traditional outlook in leadership and one
that is more dynamic and total has fostered an upwards direction for Capitec under
the direction of Fourie, as a systemic leader.
The fragmented market and Hamels dystopian future dont have to be the outcome.
With an outlook that focuses on the bigger picture, rather than an adherence to the
sums of a whole, as well as a leadership approach which is strategic, visionary and
focused on the brand identity rather than the brand image the saturated-dilution of
the market does not have to spell disillusionment with brand loyalty, or the
disintegration of the consumer/brand relationship. Instead, like Gerrie Fourie
demonstrates, its the adaptability of a brand that allows its lasting effectiveness in a
future that could involve moving the swimming pool to an ocean.

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