The critical asset in times of trouble: Reputation

By November 16, 2010Uncategorized

This recession does not want to go away: property is on the slide again, borrowing remains tight, retail sales stay stagnant and more jobs are about to be hit by a government spending review which will slash the public sector and strike private enterprise in the process.

The For Sale or To Let signs in our city centres reflect a harsh reality. Scotland’s economy is still in the doldrums.  Small and large businesses alike continue to struggle.    

Now is a time when reputation becomes critically important. Those who have failed to protect their image are discovering that this neglect is reflected in the bottom line.

Chief executives and senior managers cannot escape the spotlight as the modern media world continues to expand.  They never expected an easy time from traditional media. But bloggers now have a licence to publish whatever they like without any concern about fairness, balance or even the laws of defamation.

How does the reputation of your organisation and its leader stand up when you Google their names?

There can be few businesses that do not understand the value of reputation. But not all of them are prepared to spend the time or the investment to guard it and, more importantly, to try and make it better.

Business disasters have wiped millions of pounds off share prices because issues were badly handed.  Think BP and the banks, in particular HBOS, RBS and Northern Rock. Think of Truett Tate, director of Lloyds Banking Group, who told us we should be “delighted” that we’d been given an opportunity to invest in his and other banks. Let’s see if the public share that view once they hear all the details of Comprehensive Spending Review.

History is littered with examples of poor communication and arrogant public utterances going back to Marie Antionette whose famous declaration “Let them eat cake!” to the poor and starving of Paris led her to the guillotine. The price of a poor reputation may not be so brutal nowadays but it still leads to lost fortunes and resignations.

Reputations are gained by the consistent delivery of promises. How organisations survive in bad times depends entirely how they behave during good times.

The drivers of a great reputation are simple: there needs to be a clear vision that can be translated and easily understood by the audience, irrespective of who that is.  As a business, you have to deliver what you say you will and handle any difficulties proactively and quickly.  As a leader, you have to make sure that staff are aligned with the vision and are making a major contribution towards building and sustaining it.

The role of reputation management is to ensure that the organisation gets proper credit for what it achieves by consistently highlighting its track record on delivering its promises.  This builds trust which, over time, becomes apparent to everyone who is involved.

Otherwise, like Marie Antionette, heads will roll.

John McGurk was managing editor of the Telegraph Media Group in London.  Previously, he was editor of The Scotsman, Scotland on Sunday and the Edinburgh Evening News between 1995 and 2006.  Today he is a media consultant, adviser to Indigo and a freelance broadcaster.