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The Virtuous Cycle

The firms mentioned in the opening of the chapter have all achieved a high level of clarity and consistency between their internal and external identity. These companies are taken in a virtuous cycle where external reputation fuels internal pride and vice versa. The question now is whether managers can proactively shape the identity of their firm and create the kind of virtuous cycle enjoyed by the likes of Starbucks or Southwest Airlines. The short answer is that managers can shape the identity of their organization to a significant extent if they keep in mind that identities, individual or collective, can never be entirely specified and unilaterally engineered. We reserve the development of this argument for Chapter 11, “Strategies for Leading in the Age of Identity.” We invite you to see, in the next chapter, the different ways in which a firm’s identity can be a major liability rather than a decisive competitive asset.

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