Reputation has always been a consideration for business owners and leaders. But never before has it been more important. In a digital age where crises go viral in minutes, incidents can cause immediate damage and impact or tarnish your brand for years. The increasing reputation risk and likelihood of facing crises highlights the importance of ongoing proactive management of reputation.
Companies must now actively and perpetually manage their reputation
In the past, companies looked to manage their corporate reputation when faced with a likely issue or crisis. They’d work to solve the crisis as quickly as possible, to minimise damage, and then get back to what they were doing.
Corporate reputation is now more important than ever.
- Stakeholders expect more from businesses
- There is greater scrutiny of corporate behaviour
- Businesses face pressure from different stakeholder groups such as special interest and activist groups
- Information spreads rapidly online and quickly builds momentum
Companies must now actively manage their reputations and not merely react when they are faced with a crisis.
What does reputation management involve?
At its most basic, reputation management involves three things1:
- How others see your business - the perception of your company
- Who the business really is - your cause, your capability, your character
- What the business communicates about itself - how effective is your engagement with stakeholders and the messages you’re sending?
Managing your reputation requires measuring the perceptions of your stakeholders, understanding where the gaps lie between the company's reality and its perception and then using stakeholder insights to inform business decisions and close the gap. It’s constant and ongoing. But as we point out, steps to improve your reputation are in and of themselves, value-producing and risk mitigating.
It’s not only who you are and what you do, but how you lift stakeholders' perceptions - by repeatedly communicating with them and listening to their views. There are a number of proven, practical things that all businesses can do, regardless of their size or output, to build and maintain a strong reputation when times are good. Here’s a start.
1 Adapted from Davies, G., Miles, L. Reputation Management: Theory versus Practice. Corp Reputation Rev 2 (1998)
Interested to learn more?
CoFactor helps individuals and businesses protect and enhance their reputation when times are good, and provides expert support and guidance when issues or crises arise. Our proven and practical reputation playbook provides a clear and actionable path to improve your reputation.