Preserving or Improving Your Reputation

What's your reputation worth?

A challenging question for businesses because it is so difficult to measure "reputation's" impact on the bottom line — until something goes very wrong.

BP and Toyota certainly know what their reputations are worth as they busily tally their losses. But these types of high-profile crises are not the only instances where business reputations get tarnished.

As an example, companies develop reputations every day — some good, some bad — by the way they treat employees, customers and even job candidates in their employment processes. Eventually these experiences become broadly public being passed along by word of mouth or in today's world — from "tweet to tweet". Next thing you know — a reputation has been formed.

The Internet and social networking accelerate the public's ability to comment on your business and influence others by what is said (24/7 and 365), forcing the necessity for you to be both vigilant and proactive. Vigilant to how your company "shows up" on the Web and elsewhere, and proactive in discovering areas where misperceptions can form and lead to damage to your image, brand and bottom line.

Of course good comments are circulated too and we hope you capitalize on those opportunities and build sustainability for yourself. When negative opinions surface however (true or not) you have to be decisive and take action.

To get you thinking about some high-stakes areas in HR's domain where poor reputations can spring up, consider these aspects of your company and the questions that follow.

Recruitment: No business is in complete control of its employment experience. Not even in this market where the candidate-to-job ratio is six-to-one or greater. Top talent today is scrutinizing employers looking for companies with cultures that respect top-performer contributions and provide professional development; offer challenging work, fairness, equality and inclusiveness. How do recruits in the job market describe your company in these areas? Are these genuine attributes of your company that are part of your value proposition as you strive to attract talent?

Employment processes: The window in to your company and first-hand experience of how you operate and how you would be to work for is first opened to job applicants in your employment process. Each interaction creates an impression of you. At a minimum, top talent in the market today expects focused, timely responses to applications, well-coordinated schedules for interviews, prepared interviewers, accurate information about the position and follow up and status after interviews. Meeting these expectations helps tell the story of the importance of a job, how serious you are in filling it, and how well employees in your company communicate and prepare for making quality hiring-decisions. Does job applicant feedback reflect how you want to be known as a company? Do candidates that participate in your employment process feel that you care about them?

Honesty and Trust: These attributes are tested royally in your employment process and again each day after the date of hire. If everything promised or described during the hiring process materializes after your new hire begins work you are in pretty good shape. Unfortunately many companies tell stories during the recruitment process that just don't represent what the job or their culture offers. Eventually this catches up with them and instantly their credibility is destroyed. Do your new hires find on the inside what you described before they joined? Do they say they trust your company given how they were treated during the employment process?

Employee relations: …means just what the words say — how employees relate to each other and work together (and let's not forget managers and senior leaders including the C-suite are employees too). The foundation for effective, productive employee relations relies on clear objectives, clear role definitions, clearly stated expectations, policies, open communications and an understanding of the consequences for meeting or not meeting performance standards. How employees work together defines your culture and how you are known. If any of the foundational elements are missing or weak the probabilities of issues developing that can negatively influence your reputation as a good place to work are greatly expanded. Does great talent want to become part of your business given what they know or can discover about employee relations in your company? Does your culture demonstrate the importance of working well together and reward what it takes to create that?

Managing change: There is plenty of change to go around today, ranging from reorganizations after layoffs, merging cultures with acquisitions or new technology introductions to permit greater efficiencies with smaller work forces as the economy recovers. How your company deals with change clearly represents the kind of business you are. Integrating the rigors of effective change management into how business is transacted and how decisions are made can directly affect your bottom line. It can positively influence employees, customers and investors and be an attraction for future job applicants. How do employees rank your company's ability to effectively plan and manage change? Are you developing the kind of reputation you desire in this area?

And the list goes on, but a couple of critical questions remain. How do you know the answers to the questions asked about the areas above if you haven't recently asked those most affected by them?

Second, have you objectively looked to see how your company "shows up" where comments about your company can and do get shared?

An important point to emphasize is that being alert to issues that could adversely affect your company's reputation should be every employee's shared responsibility, but it is without question an area in which HR must lead.

Safeguarding your company's reputation should assume the importance of formalized risk management in your company, and in May CFO.com Magazine ran an article making this very point. In that article, titled "What's a Reputation Worth?" — the author observed the following:

One reason that companies may be particularly vulnerable to reputational risk is that it is not adequately addressed by enterprise risk management, the discipline that many (companies) use to prioritize perils.

How important is this in your company? How are you doing preserving or improving your reputation?

Send us your comments or let us know if you have any questions. If a lack of resources to address key issues like these presents a problem let's talk about how we might be able to support you. We've been helping companies in just that way for more than 20 years. Contact us at 925-867-4400/408-501-8863 or by replying via e-mail. We look forward to hearing from you.