What is the true cost of a bad image? A widely-cited executive study by Weber Shandwick noted that on average, 63% of a company’s market value can be attributed to reputation. Cultivating and maintaining reputation is essential, and the evidence points to a direct impact to organizations that fall short.
Take the performance of 100 companies on a joint Axios-Harris Poll research project, which measures America’s most visible brands over time. The lowest performers either suffered long-term perception issues, like Sears, or managed public controversies poorly, like Facebook. Ironically, it’s often the way a brand engages with the public, and not the quality of the company behind it, that poses the real issue.
Specific strategies and processes will obviously vary between organizations. But three core actions should guide every C-suite when looking to maintain and improve their reputations.
The late NCAA basketball coach John Wooden argued that character was more important than reputation. One certainly depends on the other. When we think of transparency as a quality, it has to do with whether people feel they can trust the words we say, and feel confident that our actions will be moral and ethical to the best of our abilities.
This isn’t as inaccessible, or even lofty as it sounds. The transition from the office to work-from-home during the pandemic is one example of a moment that called for complete internal transparency. It demanded openness about the challenges, honesty about what employees could expect and what was expected of them, and open lines of communication. It’s ideal to apply this standard to external reputation management as well, helping the public to feel like it knows and can trust you.
Be brand-oriented, whatever happens.
Especially when a tense situation arises, it’s easy to veer off course, saying or doing something out of panic, or taking a deliberate risk in the hopes that it will pay off. In a word, don’t.
Most companies have a strategic communications plan, which covers as many situations as possible without scripting the responses. Everything you or a representative of your company says and does reflects back on the whole organization’s reputation. It needs to be a universal practice to ask whether something is on-brand (while remaining authentic) – before it gets out there.
Be open to learning from anyone.
If organizations have a strong sense of their values and the quality of their services, as they should, it can be difficult to absorb negative feedback, especially when that feedback is accurate.
Cutting-edge, standard-setting companies are still run by human beings, who will get things wrong from time to time despite their best efforts. As such, even when it hurts, make it your mission to learn from everything, whether a full-blown crisis that was totally mishandled, or a customer still unsatisfied after repeated attempts to resolve a situation.
From insufficient systems to out-of-date policies, there is more often than not a kernel of truth in every negative event. Without looking for mistakes to the point of obsession, look to become an organization that embraces self-reflection and applies it to constant improvement to what you offer. This, in and of itself, goes a long way in building a positive reputation.
There are numerous benefits to giving your reputation management strategy a fresh look – from enhancing client loyalty to broadening opportunities for collaboration and partnerships within your market, and cultivating the confidence of industry peers and regulators. While it boosts the bottom line in the end, the true reward of a thriving reputation is the public believing in the unique value of your organization as much as you do.