Reputation Leaders as Weathermen

I found some research from Reputation Institute that I missed from last fall. My fault entirely and probably because I was nearing the end of the last quarter and work was more busy than ever. RI conducted interviews with 300 executives at leading companies around the world on their reputation journeys. Some of the findings are compelling and worth repeating -- 79% agree that we are competing in a reputation economy (where who you are matters more than what you produce -- nicely said) and only 20% say they are taking advantage of the opportunities open to them to manage their reputations better. 

A few quotes jumped out of me and I wanted to blog about specifically. One was from the head of global corporate reputation and responsibility at Telefonica. In the report, Alberto Andreu Pinnillos describes his team's role similar to that of a bomb squad. That made me chuckle in recognition. That's how it does feel to be on a team dedicated to understanding and protecting reputation today -- first responders, SWAT teams, terrorist attacks, detection of threats, disposal of threats, disarming of threats, scenario planning, media monitoring and so forth. Another analogy is used in the report -- reputation managers are akin to being meteorologists where you and your company are warning about or communicating exposure to extreme weather and the threats of hurricanes, tornadoes, earthquakes, tsunamis, high winds, turbulent seas and more coming at you full force. Earlier this morning I was reading about Target and the firestorm they've experienced over the hacking of customer credit card information. To them, the data hacking and breach is understandably a tsunami of woes. And, without a doubt, this is just the tip of the iceberg because other retailers will soon be revealed. That saying about everyone will experience their 15 minutes of fame and also their 15 minutes of shame is so true. 

The other quote that struck me and I wanted to share here was from the corporate VP for communications at Novo Nordisk who said the following: "I started out as a media relations officer, but today, if you look at how much time I'm in direct contact with the media, it's roughly 5% of my time, and I don't think it should be more." That is indicative of how public relations and communications have changed over the past few years. There is an explosion of stakeholders that must be cared for, listened to and tended to -- from investors, employees, NGOs, bloggers, influencers, patients, community and civic leaders, consumers, Tweeters, regulators, activists, and more. 

Worth sharing on a non-snowy Sunday (for a change).  

Effective Reputation Management Not High

McKinsey is coming out soon with their new research on defining and developing reputation. I was one of the 3,601 executives who responded when they sent questionnaires out in September and I was eagerly awaiting its release. They kindly sent the final report to those who had completed the survey before distributing it more widely. However, in their note to panelists, they mentioned that the report can't be republished without permission. For that reason, I am not linking to the report results although I bet that public release will come soon in the new year. I do think that I can mention a few of the results that I found most interesting and will add the link when they are made available. Stay tuned. McKinsey obviously leads the opening paragraph with what they consider the most important findings and that is that many executives do not think their companies' reputation management strategies are effective. Only one-fifth of executives think their companies manage reputation very effectively. Then they look at reputation management through the lenses of these "effective managers" and report that these companies are more likely to say that reputation management is among the top 3 objectives for their CEOs and that their companies formally track reputation among key stakeholders. It is always interesting how when CEOs focus on something, it becomes company mantra for all. Overall, that is the job of the CEO to focus the organization on what will advance their company's success.

As I would suspect, two-thirds (64%) expect the scrutiny on their external reputations to be more intense in the years to come. No doubt the belief that there will be increased scutiny on corporate reputation is directly tied to the fairly high percentage (47%) of companies who say they have experienced a reputation threat in the past two to three years. The industries that are above average in having experienced reputation threats are telecom (67%), pharma (60%) and financial (56%).  Interestingly, executives in the healthcare sector reported that they were  just about average (46%) in having experienced a reputation threat in the past few years but are way above average in what they expectto see in their sector over the next two to three years -- 81%.

There are some other findings I will report on when the final report is released. This is just for now. Back again soon. Have a merry Xmas.

 

Reputation Vigilance

 This week we launched our excellent survey on what it takes to socialize a brand. It is among top marketing and communications executives in companies around the world. One of the drivers of world class social brands is being ever so careful about the assaults on a brand's reputation.  We learned in the survey conducted with Forbes Insights that executives of world class social brand companies are 35% more likely than the average global company to report that their brand experienced an online crisis in the past year that affected its reputation. These social champions who have dealt with a recent online crisis are no stranger to the risks of the hyper-connected world — two-thirds (66%) report that they deal with negative online commentary on a daily basis (vs. 51% of total global companies). The latter point was good news to me although perhaps not so for companies. The reason I say that is because I often get asked about how often companies experience reputation crises and I quickly respond "daily." Our research reveals that nearly two-thirds of socially aware companies are dealing with reputation threats and its just the tip of the iceberg. Just this week we saw Netflix and RIM in the news -- some self-inflicted and some not.  If you want to read more about the blackberry crisis and my comments, go here. These types of online crises will only increase as the world gets smaller, more people go online and more are eager to share their opinion about brands.  Being vigilant is the job of everyone. Lets not fool ourselves -- we all have to play cop.