Ask any board about their organisation’s greatest risks, and reputation will almost always be found in the top three responses. Then, ask an executive team to articulate what their organisation’s actual reputation is. Chances are, executives will respond with inconsistent adjectives, often laced with aspirations.
Welcome to the reputation paradox. Despite the undeniable importance of reputation, most companies find it difficult to articulate their own. Consequently, executives and directors often only identify factors which have damaged their organisation’s reputation after a crisis or event has taken its toll. The string of recent CEO departures following damage to their organisation’s reputation are vivid illustrations of the reputation paradox; a recognised high level of risk, but a low level of awareness.
In short, many boards and executive teams are flying blind; no independent insights into their reputation or objective assessments of how they are perceived by their stakeholders. Without these, they may be unwittingly perpetuating reputation damage and increasing community hostility toward their organisation.
Corporate affairs managers are usually responsible for managing the organisation’s reputation, and this will frequently call for them to influence the CEO or other executive leaders. However, they will often emerge from those conversations without success; not convincing the C-suite about how the organisation is perceived, or perhaps the organisation’s failure to meet certain stakeholder expectations.
In reality, however, that shortfall by corporate affairs leaders may not be caused by a lack of clout, it may result from a lack of evidence.
Without independent evidence, the corporate affairs manager’s views about reputation are seen as opinions to be considered alongside the opinions of others around the executive table. A far more compelling argument is made, however, if the case they present is constructed from independent evidence from stakeholder research. So much so, that often these facts will speak for themselves. This evidence also raises the executive conversation from an exchange of points of view, to an informed discussion based on robust and independent key stakeholder research. Executive leaders are now dealing with a specific problem or opportunity - rather than a difference of opinions.
So how are organisations gathering insights about their reputation?
Two general approaches are being used to gather this information. Some organisations have made use of scoring systems which ask stakeholders to rate that organisation against a set of laudable yet generic criteria or attributes. While they do provide metrics, scoring systems don’t offer rich insights into stakeholder perceptions of the organisation and its character, its priorities or its responsiveness to their expectations.
It’s a bit like describing a Jaguar F-Type convertible as a motor vehicle with four excellent wheels, an insubstantial roof, high levels of noise, and exposure to weather. It just doesn’t convey the car’s real character, purpose and what it stands for. These are the limitations of quantitative reputation research.
Seek fresh pairs of eyes
A better approach also engages well-crafted qualitative research to explore and understand how a cross-section of key stakeholders perceive the organisation. Through in-depth interviews, informed senior and strategic-minded stakeholders will articulate their perceptions, expectations, and concerns about the organisation. They will also offer their guidance for how to address the factors damaging the organisation’s reputation.
Organisations using this reputation research model bravely invite a diverse set of interested and informed parties - investors, customers, suppliers, analysts, interest groups, think tanks, journalists, government, community leaders and sometimes even industry peers - to take part in independent and confidential interviews. These probing and strategic conversations attract their contribution because they are convinced that the researcher and the client value their perspective.
These key stakeholders, usually numbering between 20 and 40, depending on the organisation’s stakeholder map, are assured that their remarks will remain confidential. Feedback obtained in this way is often robust but always constructive, sometimes negative but typically well evidenced.
To see ourselves as others see us
Not only will the research findings from qualitative research provide a clear summary of the organisation’s reputation and any factors causing damage, but these strategic conversations will also gather the recommendations of key stakeholders about how these can be addressed to enhance that reputation. In many ways senior executive stakeholders want to shed light on the way forward, it is in their best interests to guide the organisation in which they have a stake, out of the mire.
This contribution also comes naturally for this audience of senior leaders; they are by nature ‘problem solvers’, they welcome the opportunity to suggest what needs to change, and as key stakeholders, they are usually well-informed. Most importantly they are collaborating, and making a valued, informed and strategic contribution to the progress of your organisation.
Take stock and act
The most effective organisations will not delay. They will use these findings to develop goals and initiatives to address the potential damage and to respond more effectively to stakeholder expectations. They scrutinise the execution of these initiatives against the guidance given by key stakeholders and are looking for improvement in their reputation over time.
By revisiting key stakeholder interviews every couple of years, informed executives remain in the driver’s seat, drawing on rich and insightful feedback to constantly build and enhance their organisation’s reputation. While reputation remains one of the highest risks to the organisation, a feedback tool is now in place to actively manage that risk, addressing the reputation paradox, and allowing directors to occasionally wind-back that soft top.