Reputation Owner’s Manual: 4 Reasons to Focus on Reputation

For most company leaders, reputation is a fuzzy thing that is hard to measure. We know it when we see it — our company has familiarity in the community and marketplace, people may even think we do good work, and maybe (if we are ahead of the curve) they even know what we do.

We also know reputation from the negative perspective as the news and social networks keep us well informed of companies that are failing.

For some, the reputation goal may merely be to avoid headlines for something gone wrong. So, they’ve built a crisis plan, they monitor the internet for what people are saying, and they are focused on being a good company with good products. Check! What else can be done really? Reputation is something that you can’t really take ownership of – right?

Wrong. Ultimately, a company has ownership of its reputation and how it is taken care of is entirely up to leaders. Here are four reasons why company leaders should make reputation a strategic focus:

1. The Best Defense is Offense

We can do more than just protect our reputation, we can guide it, we can create it. No, we don’t fully own our reputation, but we have more opportunity to influence it than anyone or anything else. Reputation, as defined by the Reputation Institute, is an emotional bond that includes trust, admiration, esteem and feeling. As corporations, we can sit back and watch our competitors actively work to acquire this emotional relationship with stakeholders or we can make it an intentional effort of our own. We can control our narrative, tell our story, and create our own connections. Or, we can let others have that influence. Ultimately, our corporate reputation is really in our hands and if we don’t embrace the opportunity, others will.

2. Cha Ching to the Bottom Line

Reputation impacts stakeholder decisions of whether they will support our company’s efforts, which gives reputation a direct correlation to bottom line results. Companies with excellent reputations see a significant increase over those with weak marks in decisions such as will buy from us, will work for us, will invest in us, will refer us. According to Reputation Institute research in 2016, people showed a 16% likeliness to buy a product from a company with a weak reputation and expressed an 84% likeliness to buy a product from a company with an excellent reputation. Thus, companies with weak or even average reputations get stuck in discussions around price and soon find their products are being commoditized.

3. A Championship Team

Talent acquisition is a growing business. How much do we spend on talent acquisition in our companies? It’s an important area because people are the innovators within our company; they are the service delivery and the quality control. Our success, as well as the success of our company, relies upon the talent with which we surround ourselves. Reputation has a huge impact upon who we can attract. The Reputation Institute’s research shows 17% of people are willing to work for a company with a weak reputation. However, 73% would work for a company based just upon an excellent reputation. But don’t just think about it from their research, look around at sports teams. Look at college recruiting, year in and year out the University of Alabama has one of the top football recruiting classes. With 16 National Championships, 4 in the last 10 years, Alabama has a reputation for winning championships. So, if an athlete’s goal is to be a part of a championship team, he is certainly going to consider Alabama. However, a star player might also look to go to an up-and-comer because he wants to be a part of creating success.

4. Weather the Storm

The best protection for a reputation in crises, as well as in downturns, comes from having equity with stakeholders. Working to create real connections with the people that buy our products, partner with us, work with us, and live in our communities over time creates that trust, admiration, esteem, and feeling that insulates our company and allow us to weather the storm when bumps come along, and when others go on the attack. But this equity doesn’t happen overnight. It requires intentional focus on culture, communication, and connections with all stakeholders.