Managing Country Reputation — Not Easy
We just released some new research on company reputation. This is a subject that I have always been very interested in. Considering the daily headlines about quality problems with products made in China, this research is very timely. This is what we learned about managing country reputation — it is alot harder than you may think.
Leading a large multinational company might be a complex and challenging task, but global business leaders believe that heads of state have a much tougher job than they do when it comes to managing reputation. When asked which is harder to manage — a country’s or a company’s reputation — executives chose country reputation more than twice as often (68 vs. 29 percent respectively). Our survey, Safeguarding Reputation™, was conducted in 11 worldwide markets in partnership with KRC Research.
Which is harder to manage well?
In a challenging sociopolitical global environment, business leaders clearly recognize that managing a country’s reputation or brand is complex and subject to many external forces. Recent problems with manufacturing in China, news about terrorist breeding grounds in Pakistan and U.S. government efforts to improve its reputation internationally show how difficult it is to effectively manage country brands today. By comparison, managing a corporate reputation looks tame to senior business people.
Not All Types of Reputations Are Managed Equally
Global business executives agree that when it comes to managing perception, some industry and publicly held company reputations are more difficult to oversee than others, while managing an individual’s reputation is considered easier than both according to business executives.
An industry’s reputation is perceived to be harder to manage than a company’s reputation — approximately one-and-one-half times more difficult (57 vs. 39 percent, respectively). Interestingly, executives in Italy differ from most of their regional peers and consider a company’s reputation harder to manage than an industry’s reputation (54 vs. 30 percent, respectively).
Publicly held company reputation is considered much more difficult to manage well than privately held company reputation — nearly three times more difficult according to global business executives (71 vs. 24 percent, respectively). North American executives, compared to those in Europe and Asia, were the most likely to agree with this finding (82 percent vs. 63 percent vs. 76 percent, respectively).
Company reputation is nearly four times more difficult to manage than individual reputation (77 vs. 21 percent, respectively).
Back to the difficulties in managing country reputation. A recent article in The New York Times, “China Steps Up Efforts to Cleanse Reputation,” described China’s efforts to improve its tarnished reputation after much publicized recalls of Chinese-made products such as toothpaste, tires, toys and pet food. The article said that Chinese officials have engaged in the following activities in their all-out public relations offensive: held news conferences on food and product safety, were apologetic in conversations with Western officials, offered tours to international media of government safety labs, initiated a new recall system and nationwide inspection of various industry operations, and added labels to food packaging indicating that the contents were safe. As quoted in the article, a high-ranking Chinese official said: “This is a special war to protect the safety and interests of the general public, as well as a war to safeguard the ‘Made in China’ label and the country’s image.”
Chinese officials have not just turned the other cheek. They have argued with critics about the safety of their products and have publicized that other countries too have had trouble with exports. Clearly, the Made in China reputation is being taken seriously and the country’s global communications campaign is in high gear. China is intends to recover its reputation as the Summer Olympics in Beijing approaches next year. The country even launched a special broadcast on its largest state-run network called “Believe in Made in China.”
Without a doubt, country reputation is hard to manage well. And as hard as it is to admit, much harder than managing company reputation. For those of us living in the U.S., we understand very well how it feels to lose reputational standing around the world. Someone has to take charge.