,

“A good reputation is more valuable than money.”

PUBLILIUS SYRUS (FIRST CENTURY BC), MAXIMS

If you have any doubt about just how critical reputation is, think for a moment about the horrendous mistakes made by Enron, Lehman Brothers and WorldComm and what these did to the reputations of these giant firms. When awareness of their wrongdoings reached critical mass it sent their reputations tumbling. Don’t look for these names among stable, progressive businesses – they’re gone. These companies demonstrate how the six Rs intersect and affect each other – with the certainty of dominoes falling: once one is set off, it is not long before the others follow. This is particularly evident with our next R: Reputation. Its impact is formidable: a company’s fortune can rise meteorically or be obliterated. This may sound extreme but these scenarios always remain possibilities for any company that takes its eye off the ball. It is understandable how this situation can happen. Day-to-day, reputation management is one activity among many, and it can be easy to overlook just how much reputation is contributing to your organization and how what you do, each moment, every day, affects your company’s image, brand and share price. This is never more important than in these first decades of the 21st century, when news of your company can travel worldwide in a matter of moments. Consequently, all business activities should be conducted with reputation in mind and this starts with the company’s values, mission statement and vision. These are the building blocks that frame the critical R for Reputation.

“REPUTATION IS STILL A PRECIOUS COMMODITY IN BANKING. ALTHOUGH PROFITABILITY MAY BE THE BEST FOUNDATION OF A BANK’S NAME, ITS NAME IS ALSO THE BEST FOUNDATION OF ITS LONG-TERM PROFITABILITY.”

The Economist, February 23, 2008

INSTANT, VITAL, ALL-ENCOMPASSING: THE ESSENCE OF REPUTATION

In recent years, the concept of reputation has become a major issue in business and management. Business leaders, the world over, no longer regard traditional financial indices as the only indicator of a company’s progress. As a measure of success, corporate reputation has equaled, if not surpassed, the importance of stock market performance and earnings or the recovery of investments.

Interest in reputation has soared; its ascent has boosted its status from hot potato to main course. In his book New Strategies for Reputation Management (Kogan Page Publishers, 2008) Andrew Griffin reflects on this reputation revolution. “Everybody’s talking about it. It seems that organizations of all shapes and sizes and in all sectors are fully conversant in the language of reputation. Of course, it is talked about in some countries and some companies more than others … It is now commonplace to hear terms such as ‘reputation protection,’ ‘reputation risk management,’ and ‘reputation strategy’ at the very top of a company.”

It is likely that many of us think we have a pretty good idea of what reputation is. Yet, it is also likely that when we try to identify it, the picture soon looks much more complicated than we first thought. It permeates an organization from the top echelons to the bottom line.

If we can’t precisely define reputation, how can we expect everyone in an organization to know how to manage it successfully? In Refocusing Reputation Management (Corporate Executive Board, 2005) the Communications Executive Council addresses this issue. In this group’s view, reputation “represents a loosely defined intangible concept that can vary across groups. Simply exhorting [a] company to ‘improve our reputation’ provides little concrete guidance and is likely to leave managers and staff wondering what this means and what they are supposed to do differently.”

Stakeholders

Reputation has to be viewed in relation to stakeholders. What stakeholders think is critical. What stakeholders think can be influenced by what companies want them to think. In other words, a company should be concerned by the perceptions of key stakeholders and not by the perceptions of groups of no relevance. Yet that raises an interesting question: which stakeholders are among those of primary interest to a firm? Consumers, clients, investors, suppliers, journalists, politicians, interest groups, lobbyists – each is only one of many stakeholders that should be prominent on an organization’s reputation radar screen. We have to be careful not to have too narrow a focus when determining our stakeholders, as reputation can be seriously damaged by overlooking anyone or anything. Nonetheless, the mention of consumers leads us to the next key aspect of reputation: branding.

“A BUSINESS BASED ON BRAND IS, VERY SIMPLY, A BUSINESS PRIMED FOR SUCCESS.”

David F. D’Alessandro

Brands and branding

Brands and branding have exploded both in meaning and use. Everything and everyone seems to be a brand or branded. Products and people, enterprises and entities are often regarded as brands. In every sense of the word, whatever a business offers and delivers is inextricably linked to its overall brand, which is a main underpinning of its reputation.

Clearly, then, branding lies at the heart of reputation management. A brand not only influences buying decisions but also internal business decisions and behavior. Brand and reputation are joined – better yet, they are fused; two sides of the same coin giving rise to new synergies and opportunities. For example, Alan Bergstrom, Executive Director of The Institute for Brand Leadership, makes the point that, “To us, a brand is the sum total of all perceived functional and emotional aspects of a product or service.” He goes on to say, “Branding is about adding a higher level of meaning to a product or service, thereby increasing its value to customers and other stakeholders. A brand’s value is positively related, then, to the extent of stakeholders’ emotional attachment to it.”

Drawing on this definition, a brand is how an organization distinguishes itself and its products and services in the market. To uncover just how important branding is we will look at the real life situation of buying a car. Most of us will engage in this activity several times over the years. Commonly regarded as the second largest expenditure we make, it is also a complicated buying decision for customers. There is much at stake and just as much, if not more, to consider.

The start of the process. The process of buying a car starts when we begin to look, set a budget, research and come up with a working list of cars that interest us. Then, for argument’s sake, we narrow the choices to four, as shown below (of course, the data is for illustrative purposes only).

figure 7.1: Complex decision making: Buying a car …

The contenders. Model A, Model B, Model C or Model D: which will it be? First, look at all of that comparative information. Is there something that could help cut through the morass of overwhelming and confusing features and statistics?

The solution. Admittedly, it may seem odd to add another variable to this already-long list of variables. How could adding a factor clarify rather than lead to more confusion? If we redo the table, inserting this extra feature along the top, we should see the difference that this extra information makes.

Figure 7.2: Is it easier now?

“TODAY BRANDS ARE EVERYTHING, AND ALL KINDS OF PRODUCTS AND SERVICES – FROM ACCOUNTING FIRMS TO SNEAKER MAKERS TO RESTAURANTS – ARE FIGURING OUT HOW TO TRANSCEND THE NARROW BOUNDARIES OF THEIR CATEGORIES.”

Tom Peters, The Brand Called You Fast Company Magazine

Now, our task has suddenly become much simpler: that’s the power of brand. Brand cuts through the details, removes the need to sift through a lot of data. It gives the customer an easy way of seeing your product as different – even when the technical differences between products are not great, as in the case of our four cars. With a list of seemingly similar options from which to choose, brand plays a key role. Quite simply, brand can sway the vote. Do you want to be behind the wheel of the “ultimate driving machine,” as BMW’s tagline assures? Do you fantasize about “your chance to own an Alfa Romeo,” as that company’s message suggests? Are you apt to act on the impulse Jaguar wishes to create through its “Don’t dream it. Drive it” brand statement?

“BRAND VALUE IS VERY MUCH LIKE AN ONION. IT HAS LAYERS AND A CORE. THE CORE IS THE USER WHO WILL STICK WITH YOU UNTIL THE VERY END.”

Edwin Artzt, former chairman and CEO, Procter & Gamble

A brand refers to something intangible. Yet, out of the intangible, something tangible is created: real value. A strong brand is a force that exerts an impression, a feeling, a promise. Strong brands magnify the impact of great products and services: they accelerate and enhance cash flows; they reduce uncertainties.

Figure 7.3: Strong brands magnify the impact of great products and accelerate growth

Are there hard and fast proofs that support this view? The evidence indicates that:

 

•   Brand creates value;

 

•   The stronger the brand, the more value it creates;

 

•   Brand, as a pathway to value, drives distinctive, sustained profitable growth.

 

It is undeniable that strong brands enhance financial success. As such, they are key assets that need to be carefully managed.

According to research conducted by Millward Brown, strong brands help build strong business by enabling the following:

 

•   Achieving price premiums over competitors

•   Attracting customers

•   Creating barriers to entry for new competitors, as customers remain loyal

•   Providing ‘insurance’ during economic downturns, as loyal customers still prefer their favorite brands

•   Providing reservoirs of consumer goodwill that help a company cope with a knock to the product or the company

•   Enable a business to capitalize on opportunities to expand into new markets

 

“A COMPANY’S BRAND IS THE PRIMARY SOURCE OF ITS COMPETITIVE ADVANTAGE AND A VALUABLE STRATEGIC ASSET.”

David Aaker

Exactly what is a strong brand?

David Aaker is one of the world’s leading experts on brand management. He argues that because brands create inherent value, they become part of an organization’s total assets. He explores the issue of brand success in Why Are Strong Brands Strong? (Marketing News, August 30, 2010).

Strong brands, according to Aaker, “not only deliver on their value proposition, as they have done for many years, but also they are visible in the marketplace and are a part of people’s routines. People like the familiar.” This observation sits at the top of a list of items that defines the nature of a strong brand:

 

•   Highly valued by customers

•   Familiar and highly visible

•   Trusted quality

•   Indicates success

•   Brand vision that inspires

•   Infused with energy

 

Some of these attributes are fairly obvious. Of course, a brand is strengthened when it is valued by customers. And it is not hard to see why success works, as the product is clearly tried, tested and proven. It may also tap into people’s desire to be part of something successful. Others are less obvious. For example, what does having energy mean? The most successful brands really do have energy, and one way they get this is through innovation. In fact, most leading brands remain dynamic and successful because of four elements:

 

•   Visionary thinking or demonstrating future orientation, articulating a clear view of the future allowing for changes in the market.

•   Aligned strategic thinking, with distinct plans and objectives aligned with the overall business strategy.

•   Differentiating your business and brand using market, competitor and brand knowledge.

•   Driving change and innovation, successfully developing and implementing new ideas and initiatives.

A company’s vision is an interesting case. By offering a certain vision to customers, we can associate a product very closely to them, so that it becomes integral to their lifestyles – for example, a product has the power to create a new interest or way of living, which will then become the default brand in people’s thinking. Whether the attribute is obvious or not, the devil, they say, is in the details: it is not always easy to acquire these virtues when building a strong brand.

Clearly, ‘strong’ is the most sought-after slot in branding. So: how do we get it? What drives the power of brand? What creates that invisible, yet magnetic field that has the potential to draw us in? In other words, how do you create a strong brand?

 

The answer is not one, but a series of tangible and intangible items and categories that magically seem to distinguish a brand. And this requires us to put Reputation at the core of business strategy and operations. Essentially, branding is about everything a company does, both internally (within the company) and externally, and it runs like a single thread to the outside world. We can see this when looking at the key aspects of building a brand: identity, values and beliefs, behaviors, authenticity and image and perception.

Figure 7.4: Brand essence

identity

The importance of instantly recognizable or eye-catching symbols was highlighted at a dinner party. A woman, sitting next to Raymond Loewy (creator of the Exxon name and logo), asked him why he put two Xs in Exxon. “Why ask?” he replied. To which the woman said it was because she couldn’t help noticing. “Well,” he responded, “that’s the answer.” (From The Art of Looking Sideways by Alan Fletcher)

We would all agree that logo, color and typography establish a brand’s visual identity, along with photography, illustration and advertising styles. These key design principles and executions create the look of a brand. Importantly, though, identity is not just about these elements. Brand name and brand concept, even the tone the brand sets, also inform its identity. Identity is the overall effect, the total package that results from consistently applying all parts of the branding system. Identity seeks to create intent. How it is communicated in the marketplace will reflect the brand’s personality to everyone – existing and potential customers and stakeholders.

“IN THE CONTEXT OF LIVING THE BRAND, PURPOSES AND VALUES ARE NOT CREATED, THEY EXIST – THE ISSUE IS HOW WELL THEY ARE ARTICULATED AND EMBEDDED.”

Nicholas Ind, Living the Brand

Values and beliefs

What does a brand stand for? What does it want to be known for? These are a brand’s values and beliefs. Values give customers a quick way of knowing the essence of a brand. These are the attributes, attitudes and qualities associated with it; they are meaningful characteristics that define the brand. Beliefs signify the principles that guide the brand. These help explain what the brand is, what it does and why. Values and beliefs inspire and intrigue. Put together, they create a promise intended to resonate.

We should also remember that the values and beliefs associated with a brand are not simply the result of a carefully orchestrated plan; all business activities ultimately have an impact on a brand’s intended values, as people will integrate other information they discover about a company with its intended brand values for the product. This means we have to be thorough, careful and vigilant, and we have to be consistent in the values we communicate to all stakeholders.

Behaviors

The brand’s behaviors take its values and beliefs to the next level. Essentially, brand behavior is all about knowing how the brand delivers on the promises it makes to its stakeholders. All that a brand does, says and follows through on are its behaviors, and we need to manage this complex and subtle aspect of branding carefully. We need to look beyond the immediate offering of the product: it’s the whole brand experience, the totality of actions, played out, both within an organization and in the marketplace. As Robert Haas, from Levi Strauss, argues, “Companies have to wake up to the fact that they are more than a product on a shelf. They’re behavior as well.”

“AUTHENTICITY IS THE BENCHMARK AGAINST WHICH ALL BRANDS ARE NOW JUDGED.”

John Grant, The New Marketing Manifesto: The 12 Rules for Building Successful Brands in the 21st Century

Authenticity

A brand can aspire to be something – anything, for that matter. But it won’t be around for too long if it doesn’t follow through on its claims. In this way, authenticity is a litmus test for sustainable brand success. Trust and integrity – the hallmarks of brand authenticity – go back to our earlier comments on values. Business is not just about making a profit, but rather, doing things well, being true, creating something meaningful for an organization’s legions of stakeholders. Do you want your brand to achieve credibility? Then you must connect with your customers honestly and earn their trust. Authenticity is earned and must be worked at continually. You must align it with the strategy of the company and manage it accordingly, keeping it up to date and focused on the needs of stakeholders. The need to be authentic springs from accountability: in other words, you are accountable for the consequences. If your brand offering is not reliable and trusted, the consequences can be damaging.

image and perceptions

Image is a complex, symbolic construct that evolves from a brand’s identity, attributes, messages, behaviors and personality. The mechanics of creating an image involve taking all of these aspects, adding other information as it becomes available, and then applying this image consistently across multiple channels. It is this process that will make a brand special and set it apart from others. We’re not done, though, as this is just half the story. Image flows from a bundle of thoughts, emotions and sensory stimulants. It is short term. Image is what pours the foundation and paves the way for perception.

Perception is about reaction. It is the result of brand image. It is what stakeholders think about everything the brand does, says and delivers – it judges whether the brand promise matches reality. To make this task harder for organizations, perception is subjective – it varies according to each stakeholder’s perspective.

Ideally, image creates a halo effect. In brand marketing, this occurs when perception of a desirable trait, or feature associated with one product extends to another or even to the entire line, brand or organization. This mechanism resides at the root of sponsorship or celebrity marketing, which ultimately and definitively strives to transfer emotions or traits associated with an event or spokesperson to the brand. As Walter Landor, at Landor Associates puts it, “Products are made in the factory, but brands are created in the mind.”

Figure 7.5:Brand perception

Brand positioning

The concept of positioning relates to how a product is perceived by customers relative to its competitors. The concept originated in the advertising industry as a way of identifying the product attributes that needed to be inserted into the buyer’s consciousness: for example, it may be cheap, innovative, cool or high quality. Positioning helps to provide a clear focus. It is essentially about influencing attitudes and perceptions about a product or company brand, rather than changing the product itself. Positioning improves performance by increasing awareness of a company’s or product’s capabilities and by refreshing or reinforcing an existing brand.

The following techniques are useful for achieving distinction or for effectively staking a claim in a specific market segment:

 

•   Understand the market. This involves finding a niche or part of the market where there is space to establish and maintain a profitable position. Not only does this require an understanding of the market, but also the key trends and factors influencing the market. This may require the recognition that in certain markets, at certain times, there are simply no attainable positions left.

 

•   Focus on the customer. When planning or considering the position of the product or business, it is important to remain externally focused and consider how the customer will perceive and react/respond to the message or offer. To put it another way, what message will have the greatest impact on the customer in the way that was intended?

 

•   Manage timing. Positioning is often easiest when you are the first in a new market: the value of first-mover advantage. From this position, it is possible to get to know the customer and to market in detail and then build a strong customer base and rapport with customers. Often, as a first-mover, the brand image appears responsive and innovative. For brands that are not first-movers, it is important to choose the right moment to launch, ideally when the market leader is weak or quiet or both.

 

•   Avoid head-on confrontation with the market leader. The brand with the most to lose is the market leader; they will therefore react very powerfully against newcomers, using all the resources at their disposal – wealth, fame and customers. The brand that is attacking the market leader, therefore, needs some valuable, attention-grabbing, distinguishing feature and they must strongly convey this in their message.

•   Consistency is essential. Once a position has been taken, it needs to be consistently and unfailingly defended. More than that, it has to be actively developed or the potential benefits of occupying that position will erode.

•   Choose a powerful and simple message. To be effective, the message needs to be clear, simple and consistent (such as: Volkswagen launching the Beetle in the U.S. with the slogan Small is Beautiful; Mars Bars’ claim to help you Work, Rest and Play; everything that the Ford Motor Company did was Driven by You, while Coca-Cola remains The Real Thing). The message should strike a chord with the recipient. Often the best way to establish a position is to ‘go with the flow’ and associate with an idea, issue or concern that may already be in people’s minds.

What does all this tell us about branding? Primarily: so much hinges on perception. We can see this, if we take a brief look at what makes a brand iconic. Brand is not just one-dimensional or an idea: it is BIG and Alive. It resonates in the marketplace; it engages imagination and trust; it transforms products and services into something relevant, unique and true. As John Kay from the Financial Times describes, our perception of a brand allows us to share its values. “‘I am irresistible,’ I say, as I put on my designer fragrance. ‘I am a merchant banker,’ I say, as I climb out of my BMW. ‘I am a juvenile lout,’ I say, as I pour an extra strong lager. ‘I am handsome,’ I say, as I put on my Levi jeans.”

Branding is all about perception, and perception drives our R for Reputation. We’ve come full circle. As we’ve just seen, brands are built. This leads to the inevitable question: Does that apply to reputation too?

CREATING REPUTATION

Organizations have always been concerned with reputation. However, the emphasis when managing reputation was usually after the event: that is, a company would assess its reputation according to particular measurements such as profitability or one of many operational indicators. In essence, if all the lines were going up then everyone was happy. The problem was that this simplistic approach did not account for just how complex managing reputation is. It is no longer a simple correlation between a successful bottom line and products. If organizations wish to establish, maintain and grow their reputations then they need a completely different approach. Instead of being treated as an afterthought, reputation should be placed at the center of strategy development, operational decisions, marketing activities and management of all stakeholders – it should inform and drive all business activities. Reputation does not operate in isolation so it has to be a major part of strategy. This inevitably follows from our point that all six Rs support each other.

Putting reputation at the core

“IDEAS SUCH AS ORGANIZATIONAL IDENTITY, REPUTATION AND CORPORATE BRANDING HAVE BEEN AROUND FOR A LONG TIME. BUT NEVER BEFORE HAVE THE INTERESTS THAT PROMOTE THESE IDEAS WITHIN BUSINESS – THE FUNCTIONS OF HRM [HUMAN RESOURCE MANAGEMENT], COMMUNICATION, MARKETING, STRATEGY AND ACCOUNTING – BEEN IN GREATER NEED OF ONE ANOTHER’S SUPPORT.”

Majken Schultz, Mary Jo Hatch, and Mogens Holten Larsen, The Expressive Organization

To create and maintain its reputation, an organization must accept the first rule: everything affects reputation. This means that we have to see all business activities from the point of view of reputation. This being the case, creating and managing reputation necessarily requires a multidisciplinary approach. For that to happen, organizations must place reputation at its core. That is, they should consider reputation a main component of strategy and link it to other key functions, both internal and external. Then mobilize and integrate all of these threads to shape and manage reputation. Only by doing this will we be able to achieve the desired result.

Building reputation

Reputation follows from what the stakeholders think of you and your products. So any attempt to build reputation has to start with this premise: cover all the bases.

The first port of call should be your employees. Employees count – big time. Recall the opening of this chapter about a company’s visions and values? These cornerstones of corporate culture matter when building reputation, because they affect your employees – who are the ones who relate directly and indirectly with your customers. They are your company’s ambassadors. As such, they have an active role that provides a two-way channel between the organization and its stakeholders. An employee who values the company and its products will be a better and more committed ambassador – and their enthusiasm will be infectious and positively affect your customers. Key to this is creating such an upbeat environment that the employees will create extra value by their attitude of always seeking to provide service that goes beyond what a customer expects. It is also likely that employees will think of ways that the company can improve.

THE PROCESS OF INTEGRATING REPUTATION INTO ALL BUSINESS ACTIVITIES IS SUMMED UP IN THREE AIMS: CONFRONT, COLLABORATE AND CONTROL.

Clearly, employees play a crucial role in fostering and safeguarding corporate reputation, which places great emphasis on getting internal communications right. In this regard, we now realize that even seemingly innocuous communications to employees have the potential to affect a company’s reputation.

How to achieve this can be seen by looking at the communication programs of companies with high reputations. Research conducted by Dortok shows that communication policies need to focus on communication and be end-to-end in scope. That is: you should draw up a communication plan that aligns employees with strategy, including steps for applying the plan, regularly measuring results and evaluating the findings, to improve the process for the future. By bringing employees into your plans and strategy, you will gain their trust and allegiance and, more importantly, their enthusiasm – can you imagine a better ambassador for your business?

“THE MOMENT YOU BEGIN TO DRAW YOUR ATTENTION TO THE INTANGIBLE DIMENSION OF YOUR COMPANY, TO THE REPUTATIONAL DIMENSION OF BUSINESS, YOU ACHIEVE A HIGHER LEVEL OF AWARENESS. YOU START TO REALIZE THAT THERE IS A VAST EXPANSE OF WEALTH BEYOND PHYSICAL ASSETS. YOU SEE THAT THE THINGS THAT MATTER MOST TO YOUR BUSINESS, THAT ENABLE IT TO WORK,TO BE PRODUCTIVE – TRUST, INTEGRITY, FAIR DEALING -EXIST BEYOND CONVENTIONAL MEASUREMENTS OF THE FIRM’S VALUE.”

Kevin T. Jackson, Building Reputational Capital

There are other stakeholders to consider, from customers to the media, and a reputation strategy must consider all of their relationships with internal and external interest groups. This is where one R meets another: R for Reputation; R for Relationships. This emphasizes the interplay among the six Rs and the strength they derive from each other to drive profit and growth.

This leads us to some interesting questions. Do all stakeholders factor equally into an organization’s reputation? Can reputation be all things to all groups and does it want to be?

The answers to these questions underscore the benefit of situating reputation at the heart of strategy. To begin with, we have to identify the groups we think will really matter – the opinion of the people in these groups is critical to establishing a good reputation.

There’s no escaping it: strategy is reputation

Positioning reputation within the strategy function has even more significance: in particular, refocusing. There is a new trend in reputation management to view reputation as a means rather than an end. In other words, companies are putting reputation through the strategy lens, repositioning it to become an integral part of both strategy development and its execution. Upmost in their thinking is determining those aspects of reputation that top tier stakeholders deem to be of the highest value.

The new reputation landscape

How should you traverse this new reputation landscape? First, you have to be proactive. You also need to link the organization’s reputation to its strategic goals. To do this you should quantify the positive and negative consequences of the factors of your reputation that will affect the brand. In this regard, you should identify the elements that either underpin success or harm reputation and then plan your strategy accordingly. Finally, you need to identify and align your reputation strategy with the wants and needs of the most important stakeholders

This sort of analysis requires measurements and assessment. There is a range of tools to determine, measure, and protect reputation, including diagnostics, such as a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) and an issues management process, as well as playbooks, protocols and public relations.

Dr. Charles Fombrun, chairman and founder of the Reputation Institute, drove the stake in the ground that sprouted into the fullfledged field of corporate reputation by providing valuable insight into how companies can measure reputation. He proposed using a company’s stated book value and market value to place a value on reputation. He referred to the difference between the two as a company’s intangible assets. It was not, in his opinion, an unreasonable assumption to interpret intangible assets as reputational capital.

Here Reputational capital is what gives organizations a competitive edge, as it attracts the best employees, makes shares attractive to investors, facilitates premium pricing and secures market dominance. A reputational audit will help you determine your company’s reputational capital and highlight what you need to do to realize its potential or how to make improvements. This will identify your strengths and weaknesses, which you can use to make any necessary course corrections and to develop your future strategy.

Although reputation may vary in content, context, and touchpoints from industry to industry, one aspect holds true for all. That is, the ever-growing need to gauge and protect a firm’s reputation online. That undertaking is fast becoming as vast as the worldwide web itself.

Let’s face it: we live in the age of new media, where public conversations bring together people from all over the globe. Thanks to the Internet, anyone anywhere can create a buzz that ushers in new heroes or ruins an organization’s reputation in a matter of moments.

Governments, corporations and individuals can be exposed in online chats by more than one billion Internet users. That’s downright impressive. It is one of the most powerful shapers of public perception. Crowd-sourcing or open sourcing, social networking and Web 2.0 prove that information can become more valuable as more people use it. It is a force to be reckoned with; it is a force that all business strategies need to engage with.

There are a few To Dos to help us navigate online reputation, including:

 

•   Embrace the online channel to build reputations and brand

 

•   Appoint full-time professionals to think about, monitor and act on digital activities, in real time

 

•   Communicate, communicate, communicate to proactively manage reputation

 

•   Advocate, support, observe, and engage in multiple streams to deliver strategy

 

•   Stay ahead of online trends and conversations by incorporating this medium at the core level

 

Managing reputation in the 21st century: How we got here and where are we going

Interest in reputation has soared; its ascent has boosted its status from hot potato to main course within an organization’s strategy sector. In New Strategies for Reputation Management (Kogan Page, 2008) Andrew Griffin reflects on this reputation revolution: “Everybody’s talking about it. It seems that organizations of all shapes and sizes and in all sectors are fully conversant in the language of reputation. Of course, it is talked about in some countries and some companies more than others…. It is now commonplace to hear terms such as ‘reputation protection’, ‘reputation risk management,’ and ‘reputation strategy’ at the very top of a company.” It permeates an organization from the top echelons to the bottom line. Moreover, we have to consider the international angle, as policies and strategies that work well on our home turf may or may not translate to other countries. A strong brand goes a long way to overcoming any cross-border barriers, as the reputation of a strong brand travels. As companies become more connected and international, creating a first-class reputation across borders is critical. For some companies, this can be the difference between success and failure.

Reputation is the cornerstone of any business: without it, everything else will count for nothing. Everywhere we look in a company we see mission statements, corporate values, vision, etc. Yet, having been forged within the company’s offices, it is easy to view them largely for internal consumption and to overlook how important these all are and how they reverberate throughout the world’s markets. Reputations spread far and wide and they can travel very rapidly; they can be hard to earn and easily lost. It is imperative that we fully understand that everything that happens inside a company has the potential to impact on its reputation. Therefore, to ensure that building and maintaining reputation is successful, we need to start by looking inside the organization – making sure that our values and qualities are shared by those within the company so that these then feed through to the marketplace and customers in the way we want.

Whether it’s online or off, reputation transcends time and place, as well as the individual indicators of traditional performance and profitability. The final word should go to the American poet, essayist, critic, and diplomat James Russell Lowell, who had a reputation as a trouble maker while at Harvard University – accordingly, securing his own brand and reputation:

“Reputation is only a candle, of wavering and uncertain flame, and easily blown out, but it is the light by which the world looks for and finds merit.”

As we have seen, Reputation, and in particular, brands, are the result of everything that happens both internally and externally. They connect with the outside world and need to be managed carefully, constantly and assiduously. The same is true of the next R, Relationships, and this is the focus for the next chapter.