The Reputation Cycle

 September 22, 2011
Written by Josh

Quarter over quarter it’s becoming more apparent that customers, the market, and even investors are handsomely rewarding organizations that invest in brand. Yet even the best logo is no cure-all if your company doesn’t deliver the goods.

As companies look for ways to improve their reputation in an ever more difficult market, executives likely find themselves struggling with one of the most misunderstood, perhaps underutilized business tools around: Brand.

This series of whiteboard sessions explores some of the latest trends we’ve observed and programs we’re working on. it’s meant to help clients and colleagues explore the implications and opportunities of an accelerating market and the emerging tools we’ll need.

Please leave your comments or reach out to me directly—I look forward to hearing your ideas as well, these concepts are evolving and, of course, imperfect.

Josh

Brand, or reputation if you like, is driven as much by a company’s ability to deliver on expectations as it is about making bold promises. While agencies used to set market expectations with external communications like PR and ads, today brands are formed in the minds of the customer by much more.

Between the amount of transparency organizations are legally required to have (through reports that expose quarterly finances, corporate sustainability, and social responsibility) and the tools customers have at their disposal (i.e.,Google, Twitter, and GlassDoor) CMO’s, if not CEO’s are much more likely to be burned at the stake for overpromising and under delivering. A recent example is AOL’S Tim Armstrong, who compared his hefty investment in Patch.com to properties like CNN and Amazon earlier this year. CNBC and others panned his comparison as “…completely inappropriate.” This articleon Business Insider says it well: “You can’t win respect or success by mere inference.”

Clearly Armstrong has some work to do if he’s to build his credibility and Patch’s brand in the market.

Getting ousted for not delivering is an age-old tradition in corporate America, but forward thinking executives looking to benefit from this transparency trend are reconsidering how internal behaviors are more closely linked than ever to external reputations.

I’ve noticed more of our clients starting to consider internal branding as a viable business tool, but the connection between brand internally and externally is still unclear. For example, how do employee onboarding practices and training programs relate to public perception of your company? To help flesh out these connections I’ve put together a model that depicts this cycle of reputation building.

CULTURE GUIDES DECISIONS, DECISIONS INFORM REPUTATION

Culture is the attitudes, values and goals your organization shares. This under appreciated but potentially powerful business tool should be the compass that helps every employee make the best business decisions all day, every day. Culture guides decisions and every one of those decisions influences your reputation in the market.

Will one bad choice destroy your reputation? Probably not, but if employees don’t hold a shared vision for where an organization is going or clearly understand what they are doing to help, you won’t have the critical mass of brand-aligned business decisions that will drive a coherent market presence.

YOUR REPUTATION IS YOUR PROMISE

Whether a customer hears about your company from a colleague, reads a peer review, or searches your site, they are constantly formulating their own opinion. What they’ve heard and seen, good or bad, sets the expectation for what future customers can expect should they choose to do business with you. The sum of all the data they’ve collected whether actively or passively is your brand promise.

Succinctly, your reputation is your brand promise.

Back to culture: It’s now your employee’s job to ensure your company delivers on customer expectations. Be warned, though: ‘Somewhat delivers’ won’t cut it. For the reputation cycle to become a perpetual motion machine for building brand value your company must not only have compelling external communications, but must equip employees with the vision, knowledge, and tools to communicate and deliver on that promise.