In the this post I am planning to discuss some of the steps you must follow when you find your company in the middle of a reputation crisis. Keep in mind that these rules are just valid for very big corporations and if you have to deal with personal matters you need to adhere to slightly different plan of action. I am going to write about this topic at the beginning of next week so keep following the site.
Those who are somehow involved in reputation management probably have already found lots of similarities with the medicine. Both industries operate with pretty much the same methodology when dealing with emergency issues and chronic disorders. They even use the same terms in order to easily describe what is wrong with the patient at the moment of examination. Personally, I find this very practical because it is simple for me to explain to my clients what I am about to do and to what extent their reputation health has been affected. The same lingo is applied to the recovery processes and the special diet
the client must follow when the crisis is gone.
Perhaps the most important and the most difficult task in reputation management starts with the determination of a right diagnosis. There is a big difference between the real causes of the disease
and the general symptoms a corporation faces. Your job is to identify the main roots of the problem and to provide a treatment of appropriate communication strategies which will help the you soothe the negative effects.
The intervention usually goes like this:
1. Company’s Diagnostics
The purpose of this stage is to identify the origin of the crisis and to what extent the corporate assets have been affected. In simple words you need to find answers how exactly your reputation/image has negatively changed over a particular amount of time and how much severe these losses are for you. There are a minimum of six points we definitely need to check up on.
Company’s structure
Spend time to revise the corporate operations. Are there any problems (technical, organizational,distributional, political or financial) in the implementation of your services or production? Are you able to keep all of your liabilities? Can you detect any security (IT or physical) breaches? Is there a lack of collaboration among the different internal departments?
Monitor all the media activities
Consider to deploy an online reputation management system, which will allow you to monitor all conversations on the Web related to your brand. It is also an excellent chance to gain better understanding of the relationship between user-generated content and traditional forms of online media, e.g news, print, etc. Most of the professional ORM frameworks give you the ability to follow the volume of negative publications and the types of messages that has been used to describe your products or services. Try to find out the initial source of every damaging speculation and who stands behind it.
Financial performance
Keep a good eye on the financial performance of the company. Especially on:
- sales
- overheads
- gross and operating profit margins
- return on sales, capital employees, total assets and equity
- interest payments
- pre-tax profit margin
- tax charge
- sales and profit per employee
- dividend policy
- cash flow
The reason I am recommending this is because you have to detect if there is any significant financial losses due to a bad corporate reputation. Usually most of the defamation attacks aim exactly the same – decrease in the market value and decline of the share prices. This could be achieved by spreading malicious rumors about the targeted organization which will cause some chaos between the major investors. Learn what economic terrorism
is.
CEO/ opinion formers behavior and image
The CEO’s reputation, without any doubt, is one of the major factors in the overall corporate performance. Because of its enormous significance, his persona is an inevitable target of numerous reputation attacks and nasty domestic scenarios. Even if his name is not directly involved in a particular crisis, his behavior and opinion are the ones that really matter.
Competition
Once you realize the impact of your reputation losses you need to ask yourself who is going to benefit most from all of this. Keep a good eye on your competition and how they react on your own troubles. Do not spare any energy on business/competitive intelligence because this is the best time to track down any defamation attacks. If you detect some of this, maybe it is also a good time to consider taking some legal actions. Do that privately because whining about being a reputation victim usually have the opposite effect.
Stakeholders
What your stakeholders think about you is around 60% of your reputation. Be aware of any troubles that could possibly break the relationship between the organization and its audience. Try to predict their needs and how they are going to react to any important changes and decisions.
2. Plan your Actions
This is the second level of the reputation crisis management plan. It aims to design the basic strategy you need to follow when you try to tackle your corporate troubles. Once you know the right reasons for your intangible loss, the first thing you must do is to set up specific objectives of what do you want to achieve or to change in the current situation. This could be everything – your CEO’s image, the quality of you products or simply your stock market performance. When you finish this you have to concentrate on how you are going to do this. Remember that this is a very specific job and it must be executed by experienced reputation experts.
3. Implementation
This is the moment you need to put all of your reputation strategies into action. It could be very tricky and complex process, which implementation should be tested and be revised at any single level.
4. Feedback
It is proven that corporate reputation recovery usually takes around three and a half years. This is the time when you have to concentrate on improving your ORM system or investing in reputation security testing, which would help you to prepare better for future reputation threats and crisis situations.
Bottom Line
As you probably have already noticed the last three parts of the plan are very briefly described. The reason for this is because they are very subjective and depend on the specific needs of the crisis. The good news is that there is no reputation that can not be restored so keep reading behind the lines and explore every single opportunity that could turn your loss into profitable competitive value.
