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The FBI and Corporate Reputation Management

So what is the link between corporate reputation management and the FBI? 

Effective corporate reputation management involves listening acutely to stakeholders in order to support an organisation in:

• achieving its strategic aims
•  delivering performance
•  predicting risk

All of which have a direct effect on the bottom line.

America’s Federal Bureau of Investigation has decided to listen acutely to support its strategic aims, announcing that it will be using Twitter and Facebook to predict crime.

Whatever the aim of an organisation, whether to improve its share price, increase membership, raise charitable funds or stop crime, the lesson is that effective listening and interpretation will deliver results.
And of course, in the world of digital, social and online media, visible conversation is reputation.

Here is our 5-step approach to make corporate reputation management really deliver for your organisation.

1. Listen acutely: Understand who is saying what either by using Reputation Audit or Reputation Tracker 
2. Identify what needs to change: By aligning what you hear with your strategic objectives.
3. Measure your progress: Set goals for your organisation and track progress towards achieving them.
4. Make reputation everyone’s business: All departments – whether operational or communications – need to understand how they influence corporate reputation.
5. Be responsive: Constantly assess risks and look out for early warning signals.  Be prepared to respond quickly and effectively.

Corporate Reputation Management is the Key to Responsible Capitalism

David Cameron’s recent speech launching the Co-operatives Bill made it a full house of party leaders endorsing ‘responsible capitalism.’

However, while big on rhetoric, Nick Clegg’s call for a ‘John Lewis Economy’, Ed Miliband’s  attack on fast buck capitalism and David Cameron’s call for the greater involvement of employees, have all lacked any specifics on how companies should apply this thinking.

A practical solution can be found in the principals of corporate reputation management. 

A fully rounded reputation touches on all the areas addressed by Cameron, Clegg and Milliband – fairness, transparency, employee engagement, proportionate executive pay, long-term thinking preferred to short-term profit taking.

It also places significant emphasis on more the commercial areas that ensure financial success – meeting market needs, innovation in products and services and a constantly improving bottom-line.

To embed corporate reputation management into its culture an organisation needs to do the following:

1. Listen acutely: audit corporate reputation to see how it is perceived by key stakeholders.
2. React effectively: address areas of weakness and build on strengths.
3. Be clear and consistent: both in how it communicates and how it behaves.
4.  Be constantly vigilant: tracking corporate reputation and responding quickly when required.

Contact us to find out how this approach can give your business a competitive advantage.

Keeping The New Year 'New' - Engage to innovate

Happy 'New' Year?

So despite the tricky economy, the ‘how to’ of keeping staff ‘happy’ is far more familiar to organisations than the ‘how to’ of keep things ‘new’ in 2012. 

Happy employees and the ability to create ‘new’ products and services are both key components of effective corporate reputation management.  But if, like us, you’re weary of the word ‘innovation’ and turned off by the talk of process and systems involved in creating new things, necessary as they may be, then we have some good news.

The ability to ‘create’ products and services no longer rests solely with an organisation.  Really?  Well, almost.

While an organization must be fit to nurture and develop ideas in to products or services, this is where the hard work ends.  The key to inspired creations comes through real engagement and conversation.  Not just engagement with staff but engagement with all stakeholders, the full 360 degrees, each and every one of them who has a relationship with your organisation. 

Ideas are there, already tested, waiting to be ‘picked’. The key to an organisation’s ability to create, is held in its ability to engage thoroughly and to listen acutely. We love Charles Leadbeater, one of the country’s leading thinkers in this area and this outstanding 'We Think' video captures it wonderfully.

So from us, to you, here’s to 2012, a year of happiness and all things new.

Can Virgin’s Reputation See off Higher Bidders?

Richard Branson has come out fighting in the battle for the West Coast Rail Franchise, backing Virgin’s corporate reputation for targeted investment and customer service against the deeper-pockets of his big spending rivals.

His approach shows the potential power of managing a positive reputation. Virgin clearly believes its goodwill can win the franchise at a lower price than that likely to be offered by other potential suitors such a Keolis,  (backed by France’s SNCF) Abelio (part of the Dutch national rail group), First Group and Stagecoach.

By putting the debate on the media agenda early, he clearly hopes to pile on the political pressure to accept a lower, but possibly more popular bid.

His case is helped by the previous failure of National Express, who outbid Virgin for the East Coast franchise only to hand it back two years later admitting it could no longer afford the payments agreed in the contract.

In contrast Virgin is perceived to have turned around the west coast service, which at the time Virgin took over was cursed with engineering problems.

The West Coast franchise debate follows hot on the heels of Virgin purchasing part of Northern Rock from the Government, another tarnished brand that it is clearly hoped will prosper from the Virgin touch.

The claimed saving on that deal was £400 million (the minimum loss to the taxpayer on the purchase).  The potential dividend to be earned from the West Coast franchise is £250 million (based on last year’s return of £17.8 million).

All of which begs the question, just how much is a reputation worth when managed as well as Virgin’s?

The Facebook Model of Corporate Reputation

The BBC’s documentary Mark Zuckerberg: Inside Facebook sought to cast light on how users’ data is shared and commoditised by the platform as it nears an anticipated $100 billion floatation.

Its conclusion – that the faith of users rests in a belief in the idealism of Zuckerberg – suggests an organisation whose long-term future is based on very shaky foundations.

However, this is a gross simplification. No responsible organisation (and certainly not one as carefully molded as Facebook) would invest all of its reputational capital in one man.

The guiding principles embodied by Mark Zuckerberg are embedded across the organisation, such as its high level of responsiveness when users raise concerns.

While it may not always be perfect, Facebook represents a new model of corporate reputation that puts the faith of its stakeholders at the heart of its business model.

It’s all too aware that if this reputation is injured its user base could disappear along with its worth.  Therefore, protecting and managing the asset of reputation becomes the key commercial goal for the business.  A goal that is understood by its leader, its employees and its investors.
Intriguingly, Facebook is also evolving the nature of corporate reputation for more traditional businesses. 

By providing a universal channel for customer preferences – positive and negative – Facebook puts the onus on all brands and organisations to take greater care over managing corporate reputation by listening and responding to concerns.

Perhaps the question shouldn’t be ‘can Facebook maintain the faith of its users?’ But rather. ‘how will fortunes be changed for brands that fail to listen to what Facebook users have to say about them?’

Reputation; liberty, equality, fraternity

Reputation Consultancy has been in Paris this week at the invitation of ROAM (Reunion des organisms d'assurance Mutuelle) attending the annual meeting of leaders from the French mutual sector, a group holding 40% of the country's insurance market.

Globally, 26% of the world's insurance market is mutual, owned by members, run for members, it is a powerful statistic.
At this gathering, as at any meeting of mutual and co-operative organisations, there is a shared, almost palpable, sense of pride, openness and value - even before the presentations begin.

The opening echoes the position of mutual insurance across the world; a pillar of insurance and a partner to capitalism.

Dominating the agenda is sustainability, how the sector can best prepare for long term success both in overcoming the burden of regulation and legislation and of the mutual model itself.

Presentations cover business efficiency and mutual values and include topics such as the European Mutual Statute, the value of the French social economy and the role of mutuals in the 21st century.

We can't help but feel that this is the time for mutuals, our society and economy needs something different, an alternative answer. So why do we sit here finding ourselves, not excited about the future potential but feeling a sense of 'threat' and 'self protection'?

The mutual sector believes sustainability will come from its ability to gain access to capital or to affect regulation. The opportunity is so much more broad.
In our opinion, the answer is this.

Continued success of the mutual sector is dependent on its ability to command strength of reputation among stakeholders, at a national and global level; something it is already well placed to do.

These member-owned organisations excel in so many reputation components. In stewardship, they exist to serve the next generation of members, in belonging their very foundations are rooted in society, they innovate from social need, not from greed, they deliver products and services that are designed specifically to meet members' needs. Even in performance against the backdrop of recession, they stand strong.

So why are they struggling with 'threat' and 'self protection'?  The answer is because they are not utilising the assets of their reputation.

• On brand the term 'mutual' is confused. Articulated differently by numerous brands of mutual insurer both nationally and globally, the brand is further weakened by a number of varying legal constitutions that comprise one mutual sector.
• On understanding, a key quality of reputation, there is complexity and confusion around what mutual means; ironic given the consensus and strength of the shared values lying beneath.
• A alignment between internal and external stakeholders is clear. In one presentation by a significant external stakeholder we heard the sector referred to as 'complex, vital and historical' .  The same presentations from mutual insurers themselves are peppered with terms such as 'service, duty and value'.

If the mutual sector was to stop and really listen carefully, to understand the sentiment towards them, the reasons for the attitudes and behaviours they are experiencing, then they would see how drawing equally and freely on all the assets of reputation that they already hold, would go a long way towards the sustained success of the model.

Bringing in the 'outside-in' view is as important (although not as comfortable) for sustainability as looking from the 'inside out'.
This proud, powerful sector understands very clearly the role it has to play in both society and the economy, if only it would give itself permission to listen, it could understand where its unique values can best serve to enhance its reputation.

"We need to speak with one voice," says one speaker, " why do we blush about our model?"Sustainability of the mutual model, lies in the sector's own ability to listen, understand, interpret and respond to the answer to that question and to face the reality of its reputation.

Co-operatives a Model of Corporate Reputation

 
Speaking at the recent international conference for ICMIF (the International Co-operative and Mutual Insurance Federation), our co-founder Rachel Griffiths spoke of how the co-operative and mutual models provided an excellent blueprint for good corporate reputation.

Rachel features in this highlights video (skip to about 7m 40 seconds if you’re pressed for time) explaining her case.

In her speech she also mentioned the one component of good reputation that was sometimes lacking from co-operative and mutual organisations – visibility.

She encouraged the delegates to be proud of their heritage and make sure they effectively communicate what sets them apart from mainstream businesses.

As a model for how this might be done Rachel highlighted Reputation Consultancy’s work with Co-operatives UK, producing the Co-operative Economy Report, which created national headlines earlier this year by showing how the UK Co-operative sector was outperforming the rest of the country’s economy.

What's The Real Value of the Glazer Effect for Manchester United?

Analysis by Brand Finance estimates that the brand value of Manchester United has more than doubled under the six-year stewardship of the Glazer family.

Referring to the mooted IPO, the consultancy argues that United's brand now represents more than 20% of the estimated valuation of £2bn, which would be a 250% uplift in value on the family's £790m purchase price.

Dave Chattaway, head of sports band valuation at Brand Finance, is quoted in the media as saying: “Like them or hate them, it’s hard to dispute the business success story of the Glazers reign at Old Trafford.

"From the heated takeover, to Green and Gold campaign it’s not been an easy ride for the Glazers, but a successful listing will only further cement the value they have engineered. 

"The proceeds will allow them to wipe out debt, retain control and provides the family with a perfect exit route from Manchester with a tidy return.”

However, this analysis provides a very one dimensional assessment of the impact the Glazer's ownership has had on the Manchester United brand. 

Certainly its profitability and success on the pitch cannot be denied.  But the long-term health of the club will depend on more than this.

To secure its success in the long term the Glazer's must also concern themselves with other aspects of its corporate reputation, most notably its transparency and relationship with supporters.

A visible sign of which will be in evidence this weekend when the team takes on Norwich City with both team's supporters choosing to wear green and gold.  While at exactly the same time a few thousand ex-United supporters will be watching FC United kick off against Lancaster City - another lasting legacy of the Glazer effect.

While their immediate financial success is guaranteed, it will be many years before the real value (positive and negative) of the Glazer regime will be known.

Is Ed Miliband’s Attack on ‘Fast-Buck’ Capitalism Anti-Business?

Ed Miliband’s Labour Party conference speech brought deliberately emotive language to the politics of business and placed the issue of long-termism firmly on the UK business agenda.

In attempt to capture the mood of a nation weary of economic crisis and insecurity, he took aim at “bad” business, promising to introduce policies to promote and support long-term planning while penalising those out for a ‘fast buck’.

Predictably the immediate reaction to the speech has been equally emotive.  Lord Jones, former director of the CBI and a trade minister under Gordon Brown, was amongst the most notable critics, describing it as “divisive and a kick in the teeth” for business.

However, there is considerable academic theory to support the sentiment in Ed Miliband’s speech of the need to encourage long-term thinking from our business community.

Professor Ha-Joon Chang explains in his book – 23 Things They Don’t Tell You About Capitalism – how it is vital that companies are not run solely in the interests of their owners. 
He argues that of all the stakeholders of a business, the increasing mobility of shareholders means they are the least interested in an organisation’s long-term future, with their interests best served by maximising immediate dividends rather that retaining profit for future investment.

Therefore to create stable and sustainable businesses that will provide employment, exports and tax revenue for decades to come, it can be argued that balancing the interests of all stakeholders is desirable for long-term success.

As the debate on long-termism develops in the months and years to come, it will become increasingly important for business leaders to show how they are placing the pursuit of a balanced corporate reputation at the heart of their organisation and how they are actively incorporating the needs of all stakeholders in their planning.

John Lewis Proves Less Can Be More in Growing Corporate Reputation

While most businesses would shudder at the reputational hit of announcing a 55% fall in half year operating profits, John Lewis appears to have pulled off the nifty trick of turning bad news into good.  In so doing it has illustrated perfectly the complex nature of corporate reputation.

Financial performance is certainly an important factor, but it is only one of a number of components that must be considered in order to measure reputation (and even so, the financial news for John Lewis wasn’t all bad – like-for-like sales actually increased 1% during the same period).

What possibly outweighs the reputational hit caused by the fall in profits are the reasons given for its cause.
The promise to ‘Never Knowingly Be Undersold’ has been at the heart of John Lewis for over 85 years.  At times when the retail sector enters a period of panic-discounting it can be rather inconvenient.

However, rather than choosing to find ways to avoid its commitment, John Lewis’  chairman Charlie Mayfield has been reinforcing its importance.  In an interview on the BBC he said, “absolutely it is costing us money, but it is really important we stick to it.”

His approach left some retail analysts scratching their heads.

Quoted in the The Telegraph Philip Dorgan, at Panmure Gordon, said: "I don't understand why so many people have this love affair with John Lewis. The numbers are just not that good. Most of its competitors are managing to keep their profits stable or increase them. It's all very well saying they are a private company and that it doesn't matter how much profit it makes. It does matter very much to the partners."

However, the “love affair” that Phillip Dorgan doesn’t understand has nothing to do with financial performance.  It relates to two other important elements of reputation, authenticity (the level to which stakeholders can believe what an organisation says) and consistency (which stakeholders must see demonstrated across all areas of an organisation’s operations).

At a time of financial uncertainty offering certainty of direction and behaviour can be more comforting than short-term profits.  Especially to its partners…especially when those partners are its employees.

As if to reinforce this point John Lewis has announced its biggest ever commitment to communicating its ‘never knowingly undersold’ message with a £23 million pre-Christmas marketing campaign.  This is a bold move by an organisation that truly understands the importance of reputation.