Management of industry reputational interdependence in the South African Banking Industry

Abstract

Orientation: Reputational interdependence (RI) manifests when actions of a single firm or a small number of firms materially or perceptually impact the reputations of other firms. Firms belonging to the same industry can have their reputations negatively affected by actions or inactions of their rivals. Reputational losses for whatever reason can impose costs on a firm. It is thus necessary for firms to have adequate measures in place to manage RI. Research purpose: The study aimed to explore the management of RI within the South African Banking Industry. Motivation for the study: The inter-firm dynamics involved in managing RI are underresearched. This study is intended to contribute towards narrowing the gap. Research design, approach and method: A qualitative case study research approach was employed. Data were collected through in-depth semi-structured interviews with Corporate Reputation Managers from leading banks in the country. Data were analysed using the QDA Miner software program. The thematic analysis framework informed the data analysis. Main findings: The results show four distinct approaches: competition, cooperation, coopetition, and co-existing being used by banks to manage RI. These approaches allow banks to build and protect their own and their industry's reputations. Practical/managerial implications: The study makes empirical contributions to reputation management by bringing in-depth understanding into how organisations can develop and deploy seemingly contradictory strategies into managing RI. However, these mostly externally focused strategies should not be undertaken at the expense of internally focused reputation management strategies. Contribution/value-add: The research findings show that there is no 'one-size fits all' strategic plan for managing reputational interdependence. The study recommends that firms consider co-existing, competition, cooperation, and coopetition in whatever combinations to develop strategies for managing reputational interdependence.