A company can more easily achieve its objectives if it has a good reputation, especially among stakeholders, its main customers, opinion leaders, suppliers, and current and potential employees.
If your organization is well regarded by your key customers, they will prefer to deal with you over others. And the most important thing is that they will influence other potential users through the most valuable communication that is word of mouth. Even if a problem arises in your business relationship, your suppliers will be more inclined to give you the benefit of the doubt when a good reputation is involved.
Similarly, it is with other relationships like government regulators who will be less willing to punish you if you stumble along the way; financial institutions will facilitate your access to their services; it will be an option for talent hunters; and even for those who would like to establish a strategic alliance or even a merger.
On the other hand, with the proliferation of media technologies and social media channels, individuals and organizations have access to new tools to bring greater and faster scrutiny to companies’ social license to operate, creating additional pressure to corporations allocate sufficient attention and resources to strengthening their reputation.
Therefore, the public image and reputation of your brand have a crucial impact on your business. Lacking it puts the relevance of your products or services at risk and it would even be more difficult for you to retain employees and generate profitability.
There are multiple and genuine reasons to protect, preserve and promote the reputation of your organization, for the benefit of your work. And I am going to mention some specific cases. We have witnessed how technology has changed the way products are produced, marketed and distributed. Companies are subject to constant changes to stay or excel in a constantly evolving environment. Finding ways to ensure that your customers feel receptive to the changes you plan to implement is essential. Change causes doubt and uncertainty, but if you have a good public reputation or a stable reputation, your customers are more likely to be empathetic to these changes.
Not only do you need to ensure your business has a strong reputation in times of change, but you also need to exude serenity when planning to expand your business. Expansion times are also times of both internal and external stress due to the extra burden involved in transferring reputation.
Reputation transfer refers to trying to extend your existing reputation in favor of a new product, department, or subsidiary. If you already have a good reputation, your company is more likely to successfully transfer it to a new entity or offering.
The variables in the beliefs and expectations in the public of interest are another determinant to consider in the reputational risk. When expectations change and the character of the company remains the same, the gap between reputation and reality widens and risks increase. There are numerous examples of practices that were once acceptable and are no longer considered satisfactory, ethical, or even safe by stakeholders. A good reputation is a lubricant to navigate these changes in behavior and attitudes. It is natural to believe in someone who has not only behaved well, but who is genuine.
Striking a careful balance in your public relations and reputation management is paramount then. It is essential to maintain a credible positive image, without excesses or petulance. Keeping an eye on changes in the business environment, in people’s attitudes towards the market and in particular towards your company, will allow you to adjust accordingly and manage your reputation accordingly.