Investigating the personality of companies

When we think about other people, we do so in terms that can be boiled down to five discrete personality dimensions: extraversion, introversion, neuroticism, conscientiousness and agreeableness (known as the Big Five factors). A new study suggests that a similar process is at work in our perception of companies and corporations. Google and Apple have personalities too, it seems.

Philipp Otto, Nick Chater and Henry Stott quizzed thousands of people about their perception of hundreds of companies and they've found that our view of companies is encapsulated by four fundamental dimensions: honesty, prestige, innovation and power. These perceived characteristics correlate with traditional economic measures of company performance, but they offer something more.

"With the introduction of personality factors for companies, a new way of describing companies is provided," the trio said, "which directly reflects the public understanding of companies ... Tracking measures of corporate personality might add important dimensions to economic measures of company performance and could be used both in shaping marketing and brand strategy, and potentially also in evaluating and predicting company success."

Otto's team kicked off its investigation by using George Kelly's Repertory Grid technique. Six participants named nine well-known companies and then, taking three at a time, they identified an adjective on which two companies in that group differed from the third (a process known as "triadic elicitation"). The idea of this approach is to cultivate responses from participants without putting ideas into their heads. Named companies included Tesco, BT and Chanel, and popular themes were quality, price, general appearance and experiences with the companies.

For a second study, the adjectives from the first were combined with adjectives taken from the existing literature on categorising objects, giving a total of 118. Twenty students then rated 20 companies on all these 118 adjectives. Any inconsistency or instability was weeded out. So, adjectives were retained if they distinguished between companies (an adjective is useless if all companies score the same on it), and if different participants tended to give the same company a similar rating on the same measure. This whittling led to a list of 31 adjectives. In turn, these 31 were analysed for clustering so that highly correlated adjectives like "luxurious" and "upper class" were part of the "prestige" dimension.

Next, thousands of participants recruited via the I-points web-service rated sixty-four companies along four of the 31 adjectives, and 10 more social adjectives like "friendly" and "helpful". Again, the superordinate factors of honesty, prestige, innovation and power fitted the results well and were found to correlate with traditional economic factors: for example, prestige correlated with company size and profit; innovation correlated with company growth. The final phase of the study repeated this exercise precisely a year later (in 2006) with many of the same companies, to investigate the stability of the measures. There was a high correlation in the factor scores the companies achieved, although there were also some interesting changes in the relative rankings of the companies on these measures - for example, German car manufacturers showed gains in perceived innovativeness.

"The proposed methodology not only has substantial commercial value in helping companies understand and track their public perception, but scales of this type can potentially guide and manage the decision-making of individuals or groups inside and outside rated organizations, thus influencing their organizational culture," the researchers said.
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Otto, P., Chater, N., and Stott, H. (2011). The psychological representation of corporate ‘personality’. Applied Cognitive Psychology, 25 (4), 605-614 DOI: 10.1002/acp.1729

This post was written by Christian Jarrett for the BPS Research Digest.