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Reputation matters

January, 2011

Everybody likes to have people think well of them and businesses are no different. Andrew Metcalf, director at Maxim, examines the issue of a business’ reputation and its management.

Reputations are built on trust and belief. However, progressing in life, individually as well as in business, often involves making decisions that can lead to bad outcomes. To mitigate the risks, and the potential fall-out, we need to nurture and protect our relationships and reputations.

In the business world, reputation is based on the perceptions of our stakeholders, whether it’s employees, local communities, central and local government, customers, investors, unions, shareholders, suppliers and partners. Stakeholders have tremendous power. You don’t have to look far to find examples, just cast your mind back to the recent nightmare experienced by BP in the Gulf of Mexico, which saw Chief Executive Tony Hayward become ‘Public Enemy #1’ in the States.

At Maxim our objective is simply to enable our clients to engage with the people that matter and in doing so move from a degree of limited awareness, through to trust, active engagement, loyalty, and finally advocacy, where they effectively act as your ambassadors.

Trust is pivotal 

The MP expenses scandal is the perfect example of how trust can rapidly turn to disgust and hatred. The key to successful reputation management is understanding the society in which we live and work and then considering how actions can play out and impact on a business via the media or word of mouth, which is increasingly the domain of social media.

Early warning systems are essential, but can only be developed by identifying potential problems before they happen, considering how they might impact on your reputation, and then developing robust plans to mitigate them.

Investing in your reputation management, through either positive PR or scenario planning to manage potential crises or work-related incidents, makes bottom-line sense as it helps a business attract and keep the best customers, investors, business partners and employees.

A positive reputation dramatically increases a firm’s competitive advantage when pitching for contracts, makes it possible to secure a premium price, and helps to weather the effects of an economic downturn.

At the heart of a positive reputation is a healthy relationship with the press. Investing in public relations, and getting strong, upbeat stories out to the people that matter via the media, is simply like putting money in the bank and being in credit for a rainy day. And should that day ever happen, a business is able to dip into its reputation reserves and mitigate the damage in the event of a crisis.

What should a business do to protect its hard earned reputation?

Firstly, management must accept that reputation is a valuable, if intangible, asset that needs to be properly protected once built. Clear planning, that seeks to manage risk, by first identifying it and then putting in place procedures to handle it, and that can involve media training senior management.

Importantly businesses need to learn to listen and that can involve media monitoring including the Internet and the murky blogosphere, which the BBC’s Andrew Marr described as full of “socially inadequate, pimpled, single, slightly seedy, bald, cauliflower-nosed, young men sitting in their mother’s basements and ranting.”

Andrew Metcalf - Director

Andrew Metcalf

Maxim / Managing Director

posted in: advice, reputation management,

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