Corporate reputation is crucial for any organisation’s success – whether private or public – as it directly affects how consumers, investors and partners perceive the company. While reputation management has always been vital, it has become even more so in today’s digital age as information spreads quickly and can have long-term consequences for a company’s image.
We live in an age of immediacy and invention, in which news has evolved from a scarce resource to a source of knowledge accessible to all, making it incredibly easy for people to damage any organisation’s reputation through their words, even before the organisation is aware of it.
However, it’s not just about maintaining a positive reputation in the public eye – it’s also about what a company does when no one is watching. Ethical behaviour, responsible practices, and transparency are key elements that contribute to building a strong corporate reputation that can withstand any potential negative incidents or crises.
How stakeholders perceive an organisation’s culture has been found to influence reputation. It is still shocking how much time many companies spend trying to ‘look good’ instead of being good. Corporate reputation goes beyond what you show the public. It is based on public perception, which is in the ‘eye of the beholder’ and can change so quickly.
Sometimes, entities seek to project a strong reputation to the public, whereas their integrity barometer measure is low; thus, the perception or reputation of the company in the public eye is different from what it ought to be. This is simply because it is assumed by many that ‘things can be hidden’.
Admittedly, many organisations are a bit laid-back about issues related to reputation, believing that one could always present what it wanted to feed the public and go to sleep. This kind of thinking is mistaken on many levels. It undermines the power of digital media and how it has gained ground in the past two decades. It forgets the simple fact that social media and the entire digital revolution do not forgive.
In a tweet about the work that his company must do and the difficulties it faces daily, Paul Polman, CEO of consumer goods giant Unilever, in 2017, said in simple terms: “Hard to create, quick to lose’. In effect, a company’s reputation is now more than ever an important asset that needs to be developed and maintained effectively, and this does not occur by chance. Still wondering why reputation management must be treated with all the seriousness that it deserves? Does corporate reputation warrant our attention? What has a company got to gain from ethical behaviour, especially in today’s digital revolution?
Digital media and reputation
It is a wake-up call for all communicators to understand the impact of digital media on reputation in practice. Most communication leaders will confirm that the emergence of social media over the past two decades has sent many companies working arduously to create the image they want to be associated with. About six years ago, when United Express flight 3411 – operated by Republic Airways – dragged off a passenger from an overbooked flight, little did the company know that this will become one of its nightmares and a permanent record never to be forgotten.
After 87,000 shares and over 6.8 million views of one of the videos shared by a passenger across major social media sites, the incident is forever carved into the Wikipedia page of United Express. The speed with which news, whether true or false, travels on social media is reason enough for corporate organisations to work toward keeping an unstained reputation.
Fake news has risen to prominence in recent years, infiltrating the social, economic and political realms. It has taken on a new proportion, and no one is immune to its consequences – from the highest echelons of authority to ordinary people.
According to Buzzfeed, allegations of electoral fraud in Hillary Clinton’s presidential campaign in the United States of America created the greatest effects and activity on Facebook in 2017. Frida Kahlo, the Mexican girl who was stranded in the wreckage of a school after the earthquake in Mexico City, captured the imagination of millions, but alas, it turned out to be the creation of an informant’s mind.
According to a research by Colombia’s National Consulting Center (CNC), social networks are currently the second most popular source of information. Businesses must keep an eye on potential reputational risks, especially on all digital media platforms.
Some businesses have had to learn this the hard way. A video showing Domino’s Pizza employees vandalising customers’ pizzas escalated from a nasty prank to an international public relations nightmare, permanently tarnishing the company’s reputation. Nothing is hidden anymore, and all decisions are subject to public ridicule.
What many corporate organisations fail to realise is that inasmuch as the reputation is assigned by ‘others’, digital media allows them to monitor what is being said about their organisation on the Internet and easily articulate their opinion on major issues in fora, blogs and other social media platforms that reach their target audience.
Building and maintaining a good corporate reputation
For organisations to be beneficiaries of the numerous advantages that come with having and maintaining a good reputation, companies must begin to work relentlessly toward the creation of a long-term ethical corporate character. These must be corporate goals! When it comes to reputation management, transparency is equally crucial.
Unscrupulous practices, such as fabricating positive reviews, may raise reputations temporarily; but they are likely to cause significant damage if the truth comes out. Amazon’s move in 2018 of using a lot of ‘brand ambassadors’ on Twitter to promote their working conditions has been criticised as being insincere.
1. Be honest
Being honest is one of the most essential things that organisations can do to reduce the danger of reputational damage. If an organisation is open and honest with its stakeholders during a crisis, those stakeholders are more likely to have faith in the organisation’s ability to resume operations and return to normal. This does not only instill trust, but it also preserves the brand’s value.
Rather than trying to hide failures or doubling down on negative habits, some of the most effective reputation management strategies prioritise honesty. Most stakeholders will be willing to give organisations a second opportunity if they admit to poor service, show regret for mistakes, and indicate that they are putting suitable solutions in place. That is a far more effective method of establishing a trustworthy reputation.
2. Monitor
The monitoring of the external and internal environment for potential threats to reputation is a must for all organisations in this ‘new media era’. The digital media landscape offers many avenues through which organisations can hear directly from their stakeholders about their concerns. Criticisms can, therefore, be challenged in real-time and insight obtained. That’s why, as the world shifts to a more digital environment, businesses must have well-structured procedures in place to maintain their reputation. Reputation does not happen by accident.
Admittedly, there are always issues that crop up in every organisation from time to time. These issues need to be investigated and addressed appropriately to avoid any reputational crises.
It is, therefore, the mandate of Communication and PR practitioners in every organisation to proactively work toward defending the reputation of the organisation in which they work. This can be done mainly by scanning or monitoring both the external and internal environments of the organisation to identify trends and immediately work on issues.
3. Be timely with your response
With statistics showing that most reputational damage was caused by delays on the part of the organisations in responding to issues, it is worth noting the essence of timeliness in reputation management.
The Coca-Cola Company is a case in point. In 1999, approximately 200 people in Belgium and France complained of illness after drinking the product. Soon after, it was reported that the problem was caused by defective carbon dioxide in a Belgian bottle and fungicide-tainted cans at a French unit. Seven governments in Northern and Western Europe put bans on Coca-Cola products because of these allegations.
For a long time, the brand suffered financially as well as a loss of trust with customers and employees. What went wrong when it came to Coca-Cola? Its efforts were essentially too late and insufficient. As the hours passed, the damage to the company’s reputation grew worse. The C.E.O. made his statement four days after the initial charges were revealed, and he didn’t travel to Europe until a week after the crisis began. This sparked concerns about the company’s sensitivity to customer safety issues.
Coca-Cola failed to anticipate the issues and lacked sufficient understanding of the European public health environment, according to Wakefield. It also failed to properly evaluate some long-term issues related to differences in conducting business globally versus the domestic market in the United States. A brand with a century of history was considered valueless at the time, simply because it failed to realise the gravity of the situation as it unfolded and attempted to control it from thousands of miles away.
How does your company measure up?
Some of the biggest influences on your company’s reputation include Ethical behaviour, workplace culture, social responsibility, executive leadership, customer focus, service quality, and online presence.
Studies show that these seven (7) main components influence how your company’s reputation is perceived globally:
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Ethical behaviour: the company behaves ethically, is admired by many for its ethical day-to-day business decision, and is trustworthy.
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Workplace culture: the company treats its employees well and is committed to maintaining a fair, transparent and non-toxic work environment.
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Social responsibility: the company is highly invested in socially responsible business practices and supports good causes.
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Executive leadership: The ‘tone’ from the top. How well senior leadership positions the brand and promotes it within the industry.
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Customer focus: the company cares for and is genuinely committed to its customers.
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Service quality: the company is consistent with the high quality of products and services it offers to the market.
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Online presence: reviews, articles and comments about a brand also affect its online reputation. Companies must be deliberate about positioning their brands as the go-to brand in their industry.
