Stakeholder Reputation Management Master Class 7–8 June in Johannesburg

I will facilitate my premier training course at the Apollo Hotel In Randburg, Johannesburg from the 7th – 8th June.

This 2 day training course is the only one of its kind in Southern Africa. It was developed to bridge the gap between stakeholders and organizations wanting to develop and enhance their reputations.

Since its inception in 2006, the Stakeholder Reputation Master Class has received many accolades and became established as the must-attend course for industry experts looking to share best practices about stakeholder management and building company reputation. See references.

This 2 -day course shows business leaders and managers how to establish and maintain positive, mutually beneficial stakeholder relations. It examines amongst many things the steps, hints and practices necessary to build lasting collaborative relationships, which should ultimately result in a better reputation.

Based on a synthesis of ideas from community relations, marketing, strategic communication, reputation and stakeholder management, organizational change, sustainability and CSI thinking, it offers an integrated framework, as well as practical tools for developing new kinds of collaborative relationships.

To find out more, go to: http://stakeholderreputation.invite43.com/

Understanding & Analysing Stakeholder Positions

 

justdoitI am often asked what the difference is between a stakeholder interest and a stakeholder position.

Here is a distinction that might help you next time when doing stakeholder or issue management analysis.

Positions versus Interests

Positions:

  • What they say
  • Where they stand
  • How they feel

Interests:

  • Why they say it
  • How they got there
  • Why they care

It is important to make this distinction in decision- making and stakeholder prioritisation in an issue. NLP (Neuro-Linguistic Programming) competency would come in handy here, so you could carefully analyse the language being used.

The Perceptual Position is another technique that I have found particularly useful. It comes from the brilliant book – NLP at Work by Sue Knight. NLP at Work is frequently described as one of the classics in NLP. It was the book that pioneered the application of NLP into business and made what had been previously a ‘dark art’ into an accessible practical concept that translated totally into the everyday world of influence, OD & Stakeholder Management.

She describes Perceptual positions are a way of appreciating situations from different standpoints.

Perceptual positions provide a balanced approach to thinking, not only about outcomes but about any other situation. In situations where you feel there is little or no understanding or progress, perceptual positions can provide a way of developing understanding and creating new choices.

This is a very powerful technique for finding congruent solutions especially during engagement periods.

There are many different ways of thinking about situations.

To begin with it is useful to consider the three primary positions.

1st Position

The 1st Position is seeing, hearing and feeling the situation through your own eyes, ears and emotions. You think in terms of what is important to you, what you want to achieve. Your language contains words such as ‘I feel”, “I want”, ‘I hear”, “I see”. The ‘I’ refers to your own way of perceiving the situation. Essentially you are experiencing the situation as you in your own shoes.

2nd Position

The 2nd Position is like stepping into the shoes of the other person and experiencing the situation as if you are them. When you are really in the other person’s shoes and not just intellectualising about them, then what you (the other person) are doing and saying makes sense. No matter how bizarre someone’s behaviour may seem, in their shoes it is normal. It is the best choice they have. When you are really in 2nd position you use ‘I’ meaning the other person because for this moment you are them. The ‘walk a mile in another man’s moccasins’ position.

3rd Position

The 3rd Position is the ability to stand back from a situation and experience it as if you are a detached observer. In your mind, you are able to see and hear yourself and the other person as if you are a third person. It is rather like being a fly on the wall. You are unlikely to have emotions in this position.

Imbalanced positions occur when the above method is not followed and it is often followed by resistance to change and stalling.

Skilful Stakeholder Managers instinctively use all three positions as a way of taking a balanced approach to a situation.

The definition of the word – Stake

j0402541What is a Stakeholder?

Most course delegates say that it is someone who has an interest in you. But, that is only partially correct. Yes, they might be interested, but what are they going to do with that “interest”?

Many definitions exist with probably the one that says it best – A Stakeholder is an individual or group that can impact the organization or be impacted upon by the organization.

However, few people ever stop to define the word – stake.

Maslow said if the only thing you have is a hammer you tend to treat everything as a nail. This is why definitions to me is a vital tool in ensuring common understanding.

The word stake refers to a rational or emotional stake. Thus a stake can be financial/economic in nature(ownership), it could be an interest stake, a legal one, a moral stake, an emotional one or in the case of the media – a public interest stake i.e. the public has the right to know..

Understanding a stakeholder’s stake or positioning on an issue is vital. Just because an issue is financial in nature does not mean that it does not have emotional issues attached.

For instance when companies offer stakeholders like the community money to move away from an area where they want to mine or build a dam, they often find the resistance by the community – frustrating.

The reason – Land has memories attached to it. I was sitting on my lawn the other day, when in my mind’s eye I saw my 2 kids who are now both in their late 20′s running and playing on the lawn.

Then I realised why this lawn means so much to me. It’s the memories, the emotional connection that counts.

My advice. Think carefully about what stakes are involved in an issue. If you do not know and understand your stakeholders needs, wants, desires and expectations, you could err in making value judgements about their positioning.

Or to say it succinctly – Think twice who you are going to get into bed with.

Education & Training Programs Woefully Reputation Deficient

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On the 2nd September 2010 I made a point in a blog post Discuss. Dissect. Decide that Reputation is a mission – critical task and is of such importance that it should be included in every meeting’s agenda and be included as a must in the Company Learning & Development Training Calendar – as a must and not an elective.

My point and reservations have now been vindicated through some interesting research by a company ReputationInc .

Here are the main facts they discovered by examining the curriculums of the leading Executive MBA programs identified by the Financial Times. They were looking to see how reputation was incorporated into the course work.

  • 1 in 5 leading EMBA programs teach none of the 10 core reputation disciplines
  • Just one of the 50 leading EMBAs has ‘Reputation’ as a core module
  • Communications & relationship building skills are taught in less than 20% of programs
  • Government & policy relations is covered by fewer than 1 in 5 EMBA program
  • Governance and ethics is the most popular reputation discipline being taught to business leaders today (no surprise there)

ReputationInc cites McKinsey research that found that one-half of global CEOs say managing external affairs is one of their top-three priorities. Yet one fifth of the world’s top 50 global Executive MBA programs do not offer any training in the core disciplines of reputation management.

They report that the missing disciplines include CSR, stakeholder engagement, government relations, communications, and reputation management strategy.
 
More worrying still, just two of the top 50 business schools surveyed offer a dedicated reputation module and 80% offer no training on either public affairs or external communications – the two core “hands-on” skills executives need to build reputation. “The results reveal a frightening gap between the reputation skills business leaders must possess in 2012 and the cursory attention they get in the traditional executive MBA.” 
                                                         
The programs with the highest ranked scores for including reputation are Henley Business School, Essec/Mannheim, and the University of Texas at Austin: McCombs.
 
I also agree with this statement: “On this evidence, companies and shareholders should be concerned that Executive MBA programmes risk creating ineffective business leaders who leave academia without the skills to actively manage the precious asset of corporate reputation,” said John Mahony, CEO, ReputationInc.  “Reputation management skills are vital for today’s CEO who sets the tone and mood for a corporation and must lead from the front in communicating the purpose of the brand and its value to society.

Many managers are not born ready to meet this challenge and will benefit from coaching and confidence building in reputation, something today’s Executive MBA courses fail to adequately provide.”

The problem though is that it is not just MBA modules that lack this, but also Director training programs, Government Officials training, town councillors development programs and Internal Learning & Development programs that suffer from this lack.

The research clearly shows that training in managing external relationships is mandatory for all executives (Again a vindication that my Stakeholder Reputation Management course has filled a very important gap these past few years)

It is my belief that the problem is derived from the past where it was believed that Reputation was naturally an extended PR & Communication function and discipline. And, although communication forms and integral part of the discipline, there is now a realisation that Reputation Management requires advanced systemic thinking skills and thorough understanding of intangible issues, reputation and strategic business drivers.

The report goes on to say that “These findings should be a red flag to corporate affairs directors and those responsible for leadership development in global corporations.  Knowingly or not, next generation leaders will be under-prepared
to steward their company’s corporate reputation in the coming decade.”

This statement just reminded me of the conversation in 2010 I had with the Learning & Development Manager of an international bank when they were considering my Stakeholder Reputation Management program for internal use. He was of the opinion that it was not a must, but should be an optional elective for senior executives.

How these words will haunt now. If only the financial services community understood that importance. Just perhaps there may have been less Reputation Damage.

As Warren Buffett, the world’s most astute investor have said many times: “It takes 20 years to build a reputation and five minutes to ruin it, and if you understand this YOU WILL DO THINGS DIFFERENTLY”

Funny though that most managers miss the last part of the quote. The research quoted above shows how important understanding this difference is.

The missing difference in the MBA programs – “ If I do this, or make this decision, will it harm my (own) or my company’s reputation?”

Understanding this difference is vital in an Era where Reputation is the New Bottom Line.

What is the value of Good Stakeholder Relationships?

Smiling People

Today’s complex business environment requires companies to build relationships with a wide variety of stakeholders. Each of these stakeholders have their own needs, expectations and positions and companies face stakeholder reputation risk if these needs and expectations are not monitored and faced.

Stakeholders offer organizations both opportunity and threat. For instance if an institution has a good reputation with stakeholders they may give the organization more latitude to operate.

On the other hand a poor reputation with the regulators may result in laws being passed that can make it more difficult for an institution to operate. The Consumer Protection Act is a prime example of what happens when the reasonable expectations of stakeholders are not met.

What international research have shown is that there is a lot that organizations can do to positively influence the process of creating good images in stakeholders minds.

The management of and interaction with stakeholders therefore needs careful attention if an organization wants to maximize its opportunities and minimize threats in dealing with stakeholders.

The King 3 Code on Corporate Governance makes specific mention of this need for stakeholder inclusivity (i.e. that the legitimate interests and expectations of stakeholders are considered when deciding in the best interests of the company), stakeholder identification and determination of expectations and needs, the proactive management of stakeholder relationships, and that management should develop a strategy and formulate policies for the management of relationships with each stakeholder grouping.

Research shows that when an organization builds relationships with key stakeholders, it saves the organization money by reducing the costs of litigation, regulation, legislation, pressure campaigns, boycotts, or lost revenue that result from bad relationships.

Good relationships with employees also increase the likelihood that they will be satisfied with the organization and their jobs, which makes them more likely to support and less likely to interfere with the mission of the organization.

In the not so distant past much PR efforts were one-way, designed to measure the effects of communication on stakeholders. Measuring relationships, however, assumes a two-way communication process with effects on both parties in the relationship.

The most productive relationships in the long run are those that benefit both parties in the relationship rather that those designed to benefit the organization only, the so-called Win-Win. Public relations theorists have termed these types of relationships symmetrical and asymmetrical, respectively.

It is my advice that relations with stakeholders be conducted in a context of transparency, honesty and professionalism.

A director of public affairs for a county government once summarized the link between symmetrical public relations and organizational effectiveness: “The main strategy is open communication–by being open, in touch with your various stakeholders, determining what their needs and wants are, how they can best be achieved, and how you can all work together toward common goals. And, I think that’s key with any group and organization that you bring together. That’s what you build trust on, that’s what you build relationships on, and that’s what you accomplish goals with.”

Building positive and lasting relationships should be a key organizational function and strategy.

How to do this I will discuss in more in-depth in my next Stakeholder Reputation Management Master Class in June.

 
What: Stakeholder Reputation Management Master Class
This 2 -day course shows business leaders and managers how to establish and maintain positive, mutually beneficial stakeholder relations. It examines amongst many things the steps, hints and practices necessary to build lasting collaborative relationships, which should ultimately result in a better reputation.
When: Thursday, June 7, 2012 8:30 AM to Friday, June 8, 2012 4:30 PM
Where: Apollo Hotel, Randburg, Johannesburg
Bram Fischer Road
Johannesburg, Gauteng   South Africa

What is a “Reputational Athlete”?

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A ‘Reputational Athlete’ is a manager or staff member into whom reputation
protection behavior has been so strongly ingrained that it becomes an automatic reflex.

These are staff members who routinely would ask the following question in meetings and decision making situations – “If we do this, will it harm our Reputation”?

So, how do we make staff members become reputational athletes. This is when the old adage came up in my mind – Repetition is the Mother of Skill.

The Cycle of Learning is perhaps the greatest model in guiding these efforts and is explained in a document called Reputation Risk Management & the Four Stages of Learning (The Conscious Competence Learning Model)

Download it here

This model describes the 4 stages of learning and how an employee is moved from one step to the other. I have adapted it to our field and I think you will find it to be valuable reading.

I have also taken it one step further to include the suggested 5th Step in learning – the so-called “Danger of Complacency” stage. This is the stage where an athlete continues to practise the skill which has become automatic and second
nature, but, over time, allows bad habits to form.

For example, a professional speaker, believing him or herself to be an expert, fails to prepare adequately for a keynote  presentation and drops a clanger.

These are the dangers of thinking you can do something so easily, you become
complacent.

Complacency can also cause problems if the person doesn’t keep up-
to-date with the skill or profession.

As techniques and approaches move forward, the athlete remains behind using
set methods which have perhaps become stale, out-dated or less relevant to
today. This is personified for me when I first read the brilliant book – Core Performance by Mark Verstegen, in which he puts forward training methods for maximum results in a minimum time period.

It is vital for an athlete to assess and reassess personal competence (Example – So-called personal best in running)(perhaps against a new standard. This new standard could be new thinking on reputation, ethics, governance or corporate responsibility) and step back to the conscious competence stage until mastery is attained once again.

Immersing yourself in Social Media & Online Reputation Management techniques is an example of this type of activity. For instance, I have just enrolled in the New Media University. Yep, I started reading Brian Solis’ book – ENGAGE: The Complete Guide for BRANDS and BUSINESSES to Build, Cultivate, and Measure Success in the New Web.

So, how fit are you as a Reputational Athlete?

The Phrases That Kill Creativity

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PR and Advertising agencies are supposed to be creative greenhouses. Yet,
the old “Internal editor” in all of us, raises it’s head so easy. (The “internal editor” I believe is our internal voice , our conscience, our left brain that can sometimes stop us from progressing. Years ago I worked with a consultant, a retired CEO who said the following : “The danger with gut feel is that it SOMETIMES can cause indigestion”).

Evaluate the following statements and ask yourself : ” How often you have used these statements?”.Did they prove to be correct?

  • We tried that before.
  • Where’d you dig that one up?
  • Our business is different.
  • It costs too much.
  • It’s never been tried before.
  • That’s not my job.
  • Let’s put that one on the back burner for now.
  • Let’s form a committee.
  • We don’t have the time.
  • I don’t see the connection.
  • It won’t work in our department or business.
  • It’s too radical a change.
  • The Board of Directors would never go for it.
  • The staff will never buy it.
  • It’s against company policy.
  • It can’t be done.
  • It’s impossible.
  • Let’s get back to reality.
  • That’s not our problem.
  • We’ve always done it this way.
  • I don’t like the idea.
  • You’re right, but…
  • You’re two years ahead of your time.
  • Don’t rock the boat.
  • It isn’t in the budget.
  • Has anyone else ever tried it?
  • Good thought, but impractical.
  • Let’s give it more thought. If not, or if they did!

What is the lesson for your consultancy or team? Please let me know!

Making the List of the Most Unadmired Companies Survey

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The World’s Most Admired Company survey by Fortune magazine – see 2011 study results at http://money.cnn.com/magazines/fortune/most-admired/ have been one of the ground breaking annual studies to have been conducted in the field of Reputation and have added much to our understanding of what makes companies great.

But what about those companies that did their utmost to destroy their carefully crafted reputations during the past year (and years). Many companies, institutions and individuals have made this list in the past twelve months.

Perhaps we should start a World’s Most Unadmired Company List. Without being specific, there have been many examples. Many websites and other bloggers have asked their audiences for their thoughts on the matter. Take a look at the examples cited in articles such as:

The Holmes Report – The Top 10 Crises of 2011 – http://www.holmesreport.com/featurestories-info/11377/The-Top-10-Crises-Of-2011.aspx

Australia’s 2011 List – http://prdisasters.com/?p=944

These examples show that no organisation is immune against potential crises and incidents that can destroy their good names. The question that should be arising in your mind is:”What is the potential for my organisation to find its way on to this list?”

An interesting study from Willis Group Holdings on reputation risk caught my attention. They examined 600 publicly-held companies.  Here are some of the more interesting details:

  • 95% (a lot) of major companies have suffered at least one reputational crisis in the past 20 years
  • Major companies suffer a “significant” reversal of fortune every seven years
  • One out of two (50%) of these reputational failures were tied to having the wrong business strategy or model; 15% from lawsuits; 10% from merger and acquisition issues. Interestingly, the CEO of Willis Global Solutions Consulting Group said that none of the crises were related to natural disasters until 2011. That is hard to believe since there have been plenty of natural catastrophes over the past 20 years that should have impacted companies such as floods, hurricanes, droughts, food shortages, cyclones, earthquakes, SARS, etc.

Also wanted to mention a recent analysis that came from the 2012 Harris Interactive Reputation Quotient (RQ) and was reported in PRWeek. Harris Interactive reported that advertising has less of an impact on company reputation than social media or new stories.

Research continues to show that word of mouth from news stories with negative information about companies drives perceptions more than we realize.

Weber Shandwick reported in their Company Behind the Brand: In Reputation We Trust that consumers are talking about more about company wrong doing than right doing and advertising may not be as able as it used to be in rehabilitating brand reputations.

The key word now is stakeholders. So many companies have customer service or shareholder programs in place, ignoring their other stakeholders. What are the perceptions of suppliers, the government and the media with regards to your company?

Let me leave you with a question: Who in your organisation has assumed a holistic (systemic) view of managing stakeholder reputation?

If there is no one, your organisation is in danger of making the unadmired company list. If you want to find out more about how you can safeguard your company’s reputation or if you want me to address your management team on this issue, e-mail me.

A Social Media Policy can Protect your Corporate Reputation

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Time and time again the issue of Social Media is raised in my Stakeholder Reputation workshops. Is it a must? Is it a Stakeholder Engagement tool? What is its value? Should we restrict its access?

Companies are coming to terms with the growth and use of Social Media within and without their organisations and some of the companies that I deal with are grappling with its implications and how to use it in a positive way. Others simply do not allow it and damage their own reputation by not viewing it strategically. Others just implement it without giving adequate thought to potential reputation risk.

The benefits of social media are real, and use of this communications medium as an important Stakeholder engagement tool will likely only increase. However, for organisations to reap the full benefits, it is critical to take a customised, strategic approach to managing the risk of social media vs. reputation.

For me it is important for companies to determine that it fits the purposes of it stakeholder engagement plan and is supported by necessary policies, processes, technologies and roles to manage the risk.

Having a well-designed Social Media Policy is the start. Jeff Bullas define it A social media policy plain and simple outlines for employees the corporate guidelines or principles of communicating in the online world”.

Companies without adequate social media policies are placing themselves at risk of security breaches and reputational damage, among other issues. Last year, a study from Protiviti Inc., a global business consulting and internal audit firm revealed that the majority of UK employees have not been provided with clear guidance on using social media networking sites.

  • Many organisations had no policy in place regarding social media networking
  • Many employees were unaware of such policies
  • Social media usage in the workplace has grown enormously in recent years with more than half (51 percent) of workers surveyed now claiming to engage with a social networking site whilst at work. Almost a third (30 percent) of workers use sites such as Twitter, Facebook and LinkedIn on a daily basis, while more than five do so several times an hour. 

Many organisations do not allow social media activity in the workplace, but this is an unsustainable policy as staff are still able to access social networks from home, posing the same potential risks to the company’s brand and reputation.

In this respect, it is interesting to note IBM’s view. In the spring of 2005, IBMers used a wiki to create a set of guidelines for all IBMers who wanted to blog. These guidelines aimed to provide helpful, practical advice—and also to protect both IBM bloggers and IBM itself, as the company sought to embrace the blogosphere. Since then, many new forms of social media have emerged.

I like Point 11 – “Try to add value. Provide worthwhile information and perspective. IBM’s brand is best represented by its people and what you publish may reflect on IBM’s brand” See more – IBM’s Social Computing Guidelines

The Gap Inc., struggling to make its brands stand out in today’s crowded marketplace, is turning its workforce loose on social media in an attempt to recreate some of the buzz for which it was known in the ’80s and ’90s.The clothier gives each of its 134,000 employees a no-nonsense social media policy titled: “OMG you will never guess what happened at work today!!” The policy serve as a guide to how a large, multinational corporation can strip away the legalese and provide a real-world manual on social media that keeps the company’s best interests in mind. Read more http://www.prdaily.com/Main/Articles/11088.aspx#

In designing your Social Media Policy, I can highly recommend that you also access the following resource: http://www.jeffbullas.com/2010/02/15/only-29-of-companies-have-a-social-media-policy-is-your-company-at-risk/

Common sense is also required. To prevent any online crisis on Social Media networks, you should monitor the names of companies, brands and employees. To ensure this, you need to develop proactive communication strategies to reduce both online and offline crisis. The simplest way to do this is to:

  • Create Training Programs that show employees how to use Social Media effectively.
  • Share Best Practices that give examples of how others use Social Media and respond to stakeholder interactions
  • Develop Guidelines that clarify in simple terms how Social Media should be used and the exceptions you need to avoid when using these channels.
  • Monitor how staff use Social Media and made the necessary corrections, adjustments or interactions where necessary using influence & guidance.

Employees will stop using Social Media if they feel there are being policed. Instead adopt a light touch policy where you try to help employees do their job better with Social Media and reward those who get it right.

If you’re looking for ways to control your Online Reputation, then ensure you have a well-designed and communicated Social Media Policy in place, one that focus on what’s important: engaging the stakeholder.

Drills and Simulations are NOT a Waste of Time

Last year a blogger, the Time Ninja blog ran a post – 5 Reasons To Say No To The Fire Drill that I felt was irresponsible and ignored the emergency aspect and saving of lives.

The article asked the question – ‘what would happen if you chose to say no to the fire drill? Would the earth stop spinning?  Would you lose your job?’

I responded as follows:

Whilst this is a good article, it completely misses the point of a fire drill.

fire_01Fire Drills are not time wasters. They are a necessity. Fire kills. Large buildings including warehouses have burnt to the ground in less than 15 minutes.

The objective of such a drill is to save lives.

Not only is it a legal safety issue, it is crucial for any organization that wants to protect its reputation. I mean who wants to work or do business with an organization that killed employees and hopefully not, customers as well.

The whole idea with an emergency is to be prepared and to deal with the crisis situation in an orderly and organized manner.

This brings us to a problem situation. If you are an Emergency Manager, do you run an simulation unannounced or a simulation that has been communicated before the time. The one is real, the other contrived.

IMHO it is the best to do the second. People will comply, once they fully understand the reasons WHY, not just the How. I have taken managers with a dubious outlook to the burn unit at a local hospital. Once they visited there, their whole life experience changed.

Equip people to act positively. Build on rocks, not sand.

Ultimately, this goes deeper. To be an Admired Company today, to be a Best employer, deserves attention to detail others ignore. Ultimately it is about caring. A Company that does not prepare for all eventualities will communicate a message that it stakeholders are not important, and as research shows these days, people want to do business with companies they can trust – even from a safety perspective.

Stakeholder Group–The “Elderly”

A recent report by Goldman Sachs reported that economic growth in the BRIC countries will be impacted by the fact that young people will have to look more and more after older people. Estimates show that there will be a 46% increase in these countries of people over the ages of 65.

This information reminded me of reading the Commissioner’s report on Hurricane Katrina in New Orleans where it was mentioned that one of the stakeholder groups Emergency Teams were not equipped and prepared to deal with was old people – most not in the medical system. Disaster staff reported dealing with bed ridden old and frail people.

Due to world-wide advances in health care, people will tend to live longer than the median age. More and More reports are showing that many people will not be able to retire and live off their pensions.

This raises interesting thoughts for Stakeholder Managers, for instance:

  • How do we look after these people?
  • How do we make use of their experiences and knowledge?
  • What are their preferred needs and wants?
  • Their preferred communication methods?

Viewing it from another angle it also raises interesting angles for Universities. Your alumni will get older and will need to be kept in the fold.

There is also this fallacy that all people want to retire and live happily ever after. In the early 80’s I managed a Mentorship Scheme for the Small Business Development Corporation where we used retired executives to do small business management consultations and act as advisors to entrepreneurs (Similar to the US SCORE program). I recall working with a retired Swiss CEO called Werner Freund. He was as sharp as ever at 72 and I learned more from him in a year than I learnt in my studies.

These are the type of people who we need to embrace and use. They can be a useful resource if you think strategically about it.

I would also recommend that you visit the Department of Social Development’s website for updated information such as this report deals with the rights of older people.

Does Reputation Really Matter?

Does Reputation Really Matter?

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For the past 15 years I have been speaking and training that it does.

Well it does! My views are now more and more vindicated by on-going international research such as the interesting findings from the Global Corporate Reputation Index study conducted by Burston-Marsteller amongst 6000 companies worldwide and the 2011 Lloyds Risk Index.

Burston- Marsteller’s studies show that Corporate Reputation is underpinned by 2 main drivers namely Performance (Putting your money where your mouth is) and Corporate Citizenship. View the findings on – http://www.slideshare.net/BMGlobalNews/global-corporate-reputation-index

(I find it still interesting that this terminology is used as there is a drive worldwide to just call it Corporate Responsibility)

They found that the average age of the top 25 companies had an average age of 87 years in business with the oldest company having been around for a 147 years. This reminded me of the story about Agatha Christie’s famous play – The Mousetrap that ran at London’s West End Theatre for more than 35 years. Over the years, directors and actors were changed but the standards never wavered. Most certainly a lesson for compliance and adherence to standards of commitment.

What stood out for me is that the world’s most reputable brands set high corporate responsibility standards for themselves and their partners and deliver consistently over time.

These are also the companies that invest heavily in corporate responsibility practices and adherences to codes of standards and conduct like ISO and ensure compliance with these codes of governance and best practice.

These companies also view potential Reputation Risk in a serious light and understand how dangerous it can be in a interconnected world. According to the world’s largest reinsurer Lloyds Reputational risk rose to No. 3, up from No. 9 in 2009, according to the 2011 Lloyd’s Risk Index. View the report – http://goo.gl/NlQRb.

In fact, A 2010 study of the world’s 1,000 largest companies found that 80 percent lose more than a fifth of their value every five-year period because of a major reputational event.

Studies also show that the role of Social Media can no longer be ignored and that these companies have to have a dedicated function to deal with its Digital Reputation and the flow of messages in nano-seconds.

Late last year a new white paper by Deloitte developed in collaboration with RiiЯ Ltd entitled ‘A Risk Intelligent view of reputation – An outside-in perspective” once again highlighted the strategic importance of reputational risk. The report highlighted the fact that Reputational Risk is now regarded globally as a “meta risk, “standing at the forefront of key strategic and operations concerns, right alongside new competition, technology failures, talent issues, and changing regulations.

As executives in the study recognized, reputation, quite simply, can make — or break — a company. Reputation is an important factor across all four major risk areas of the Risk Intelligent Enterprise — strategic, operational, financial, and compliance — particularly of the former two, strategy and operations, because it is a constantly evolving and fully embedded part of why and how the company achieves its objectives.

This catapults reputational risk to what the writers call a meta risk, or a potential menace to fundamental business strategy, and possibly an even greater hazard to organizational survival than a financial restatement or problematical findings in a compliance report.

Read the Report – http://bit.ly/ph6omX

Can you define this Meta Risk in 4 different ways as well as describe the mitigation & prevention strategies required to prevent & respond to the risk that has been called the most dangerous and difficult to manage? I can help.

On the 5th – 6th March I will facilitate an intensive 2- day workshop on how to Manage and Mitigate Reputation Risk for those interested – More information available at http://goo.gl/6WM8M

Many people have asked me why I help companies to protect themselves against Reputation Risk. Why? Well this quote says it all – “If someone is going down the wrong road, he doesn’t need motivation to speed him up. What he needs is education to turn him around.” – Jim Rohn.

My presentations and trainings are dedicated to create the necessary awareness and know-how to help companies to safeguard their fragile reputations.

Reputation does matter, and not only too companies. It is valid for us all. Read my blog post – http://deonbinneman.wordpress.com/2012/01/10/your-name-is-a-precious-commodity why your name is a precious jewel.

New Stakeholder Group–Corruption Watch poses Reputation Risk Threat

Readers of my blog may recall that I mentioned in one of my earlier posts that organisations should monitor the formation of new alliances and associations in their field, so that they can pre-empt and where necessary, engage with and build relationships with these stakeholders to protect their reputation.

Yesterday, a new stakeholder group was launched that will specifically target corruption in South Africa. Corruption Watch is an autonomous watchdog that will enable victims of graft and ordinary citizens to make reports that will be swiftly attended to by independent professionals, and is supported and financed by some corporate foundations and companies including Aveng, Ernst & Young and the Industrial Development Corporation. It will have its own staff, including lawyers, auditors and accountants as case officers.

The Cosatu-initiated organisation will gather, analyse and expose information.

PricewaterhouseCoopers’ annual survey of CEOs released this week found 66% of South African bosses were concerned about corruption, compared with 34% in other countries.

Corruption Watch’s executive director, David Lewis, said at the launch of the unit in Johannesburg yesterday that it would attack private-and public-sector corruption equally. He also said that the organisation had a website to enable victims of corruption to lodge complaints.

The body will be independent of the government and organised business. Part of Corruption Watch’s work would be to strengthen the accountability of those – in both the public and private sectors – who are in a position to influence the deployment of, and access to, public resources.

The watchdog collects information from victims, accomplices and whistle-blowers, documents media reports and research studies in other public sources, gathers information through its online reporting form, analyses data to identify patterns and endemic sites of corruption, and investigates and publicises research reports on hotspots of corruption.

Already Corruption Watch has suggested the JSE suspend corrupt firms’ listings, impose fines for illegal behaviour and create other prohibitory measures.

The unit would outsource investigations of corruption brought to its attention to lawyers, accountants, auditors and other professionals.

These professionals will most certainly include the Media & Social Media players like bloggers and other influentials. Using the Media to expose and create exposure and awareness is a technique that has been used to great effect by people like Elliott Spitzer, the ex- Attorney General of New York.

This watchdog body will have to be on the radar screen of not only Corporate Affairs Managers but also Compliance Officers, as its formation poses a significant reputation risks for companies who do not act quickly & significantly to weed out corruption in their own organisations.

Reputation Managers will need to work closely with their in- house counterparts to prevent unnecessary reputation risk by not only talking about weeding out corruption, BUT running programs that will show stakeholders their interest and commitment to deal with issues like corruption.

Who – or What is right? Just a Random Thought

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Who – or What is right?

Just because you are right, does not mean that you need to exercise that point or view.

We are not fish who have to take a bait. What is more important- Winning the War or winning a battle?

We have choice, and I think that a lot of people have lost that ability to think about the decisions they make. As Postman & Weingartner said in Teaching as a Subversive Activity….we need to become crap detectors.

Even Anthony Robbins indicated that it is useful to sometimes check your own values and beliefs, to see if they are still relevant.

But anyway, I just thought I would share this story.

An old man and a young boy were travelling through their village with their donkey. The boy rode on the donkey and the old man walked.

As they went along they passed some people who remarked it was a shame the old man was walking and the boy was riding.

The man and boy thought maybe the critics were right, so they changed positions.

Later, they passed some people that remarked, “What a shame, he makes that little boy walk.”

They then decided they both would walk!

Soon they passed some more people who thought they were stupid to walk when they had a decent donkey to ride. So, they both rode the donkey.

Now they passed some people that shamed them by saying “how awful to put such a load on a poor donkey”.

The boy and man said they were probably right, so they decided to carry the donkey. As they crossed the bridge, they lost their grip on the animal and he fell into the river and drowned.

The moral of the story?

If you try to please everyone, you might as well kiss your ass good-bye!

Corporate Reputation & Product Reputation (Brands)Now Nearly Indivisible

Corporate reputations impact brand and product sales performance. That’s one of the key findings from a recent global study by Weber Shandwick called The Company Behind the Brand: In Reputation We Trust.

As the survey report states, “As consumers around the world have greater online access to a brand’s lineage, the influence of the brand parent, or company behind the brand, matters even more.”

The study identified Six New Realities of Corporate Reputation, which the PR firm says serves as reminders that business leaders cannot view their company’s reputation and their product brands as separately as they once did.

These six “new realities” are:

1. The corporate brand is as important as the product brand(s). For instance seventy percent of the respondents said they avoided buying a product if they dislike the company behind it.
2. Corporate reputation provides product quality assurance.
3. Any disconnect between corporate and product reputation triggers sharp consumer reaction.
4. Products drive customer discussions, with reputation close behind.
5. Consumers shape corporate reputations instantly.
6. Corporate reputation contributes to company market value.

In actuality, none of these are truly “new” realities, other than perhaps the ability of consumers to now shape corporate reputations instantly via social media.

What is also very clear from the survey is that Crises like product recalls or any incident involving the company can cause irreparable damage to the brand and reputation.

In reading the report, the value of minimising potential reputation risk became apparent. For instance, if a Reputation Manager paid attention to the top 5 talking points that the research revealed, he or she could develop strategies to minimise the risk before it occurred.

These five talking points are customer service, how employees are treated, company scandals or wrong-doing, and their feelings about the company as a whole (its reputation).

Understanding Reputation Risk and what could destroy value is now a vital competency for any Reputation Manager.

The report also clearly shows that Reputation Matters now even more than ever, with more than 60% of a company’s market value attributed to it.

The report which makes for excellent reading, is available online here

Your Name is a Precious Commodity

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Your name will arrive at a destination long before you do, so best make sure you have a good name, so the old adage goes.

I was reminded of this last year when I arrived in Beijing to facilitate a Crisis Management & Crisis Communication for Reputation Protection seminar at the Grand Millennium Hotel.

There were a number of delegates that had flown in from places as far as Hong Kong and when I asked the audience what brought them there, the delegates specifically replied. ‘My Reputation’

This just reminded me again of the importance of reputation in marketing & communication. But this subject also worried early authors and philosophers. Here are a few selected quotes worthwhile of thinking about:

“Early impressions are hard to eradicate from the mind. When once wool has been dyed purple, who can restore it to its previous whiteness.”–St. Jerome.

‘Regard your good name as the richest jewel you can possibly be possessed of – for credit is like fire; when once you have kindled it you may easily preserve it, but if you once extinguish it, you will find it an arduous task to rekindle it again. The way to gain a good reputation is to endeavour to be what you desire to appear.” (Socrates – 469 BC – 399 BC)’

Individuals sometimes forget that they themselves have a reputation- just like their organization. Countless studies show that Corporate Reputation is an organization’s biggest asset, yet most dangerous risk in the marketplace.

It is no different for a person. In fact depending on your chosen career, position and stature, it becomes your stock in trade and a lever for success. For consultants and professional service providers reputation is sacrosanct.

It boils down to three crucial elements:

1. Know-how (Your intellectual capital i.e. what you know);

2. A Network of contacts (Social Capital – who you know);

3. Your Reputation (Reputational Capital – who trusts you).

The key for any person who is interested to build their own reputation is to work on these 3 elements as part of their own career development plan.

Many years ago someone shared the concept of the 3 E’s with me. I think it is a Dale Carnegie concept that I am sure you will find valuable in the building of your reputation.

The Three E’s:

E – Earned the right. You can only address a person or a group if you have earned your “stripes” be it through qualifications, experience, and preparation. Doing research, reading and studying your chosen field adds to this. It is about what you know.

E – Be Enthusiastic. Will you buy from a salesman whose product does not generate enthusiasm in himself?.

E – Be Eager to share. Are you eager to share your knowledge, the gem or nugget of wisdom that you have with the person you are talking to or the audience?.

In my own life experience I have found the concept of the 3 E’s incredibly helpful. If you go to my personal profile at http://za.linkedin.com/in/deonbinneman and read the recommendations by other experts you will see how the three E’s have manifested themselves in my career and how they added to the 3 key elements of building a reputation.

The implications of these words is that reputation is something that needs constant work just like a gardener attending to his flower beds. Like as in gardening it does not take much for weeds to grow, pests to come and flowers to wilt.

Constant attention and vigilance is needed if you want to maintain and safeguard your reputation. Do you know what drives your reputation? Do you know what can add or subtract from that reputation?

In an area of instant information exchange, where new technologies support new ways of working and communicating, the task of managers is to develop good interpersonal skills and the ability to use new communications technology appropriately.

This use should include an understanding of the misuse and dangers inherent in social media. These days there are companies that for instance specialise in online reputation management — companies that attempt to remove damaging Web content for embarrassed clients.

Just as everyone was once promised 15 minutes of fame, each of us can now expect to have our own “WikiLeaks moment,” the CEO of The New York Times.

Social media expert and former dating columnist Julia Allison likens bad news on the Net like a digital tattoo. It’s like tattoo removal, Allison tells the Times. Although it is possible to erase, it’s expensive and painful and it may always leave some kind of mark.

This implies that companies and individuals need to be more organised and think strategically about the messages that they communicate, advertently or inadvertently. In today’s knowledge economy your reputation and name is your stock-in-trade. Manage it carefully.

My Stakeholder Reputation Group on Linkedin

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I started a Stakeholder Reputation group on LinkedIn last year, aimed at anyone that is working in and grappling with Stakeholder Management & Reputation related issues.

To date there are 345 members (and growing) which includes a number of senior communication and local and international consultants that I have come across.

The collective experience and expertise that resides within the group will enable any organisation to develop and execute a successful stakeholder engagement and reputation management strategy.

The primary aim of the group is to encourage the sharing of information amongst members such as the introduction of new ideas, concepts and tools, sharing personal experiences of things that work or do not work, overcoming resistance to stakeholder relationships in the market and within companies and asking for assistance for problems being experienced.

If you are interested in learning more about Stakeholder & Reputation Management and where it is going, I encourage you to join our group, participate and share. Here is the group link – http://linkd.in/aRGqiF to join.

Recently, I received a notification from Linkedin that I was one of LinkedIn’s first 100,000 members (member number 28959 in fact!*). In any technology adoption lifecycle, there are the innovators; those who help lead the way. That was me.

More than 100 million professionals have joined that site. If you are not on Linkedin, you are doing yourself a disservice. LinkedIn is changing the lives of millions of members by helping them connect with others, find jobs, get insights, start a business, and much more.

Thinking Quickly – A Quick Reframe

The ability to think on your feet is an important skill, as this story illustrates:

Two lawyers arrive at the pub and ordered a couple of drinks. They then take sandwiches from their briefcases and began to eat.

Seeing this, the angry owner approaches them and says, ‘Excuse me, but you cannot eat your own sandwiches in here!’

The two look at each other, shrug and exchange sandwiches.