Tips for Organizations to Proactively Manage Reputational Risks
As Warren Buffet aptly put it: “It takes 20 years to build a reputation and five minutes to ruin it.” This is especially true in today’s digital ecosystem, where every stakeholder has a bullhorn and word travels at lightning speed. This reality hasn’t escaped notice among corporations: reputation was the top risk-related concern cited by 73% of participants in the 2013 Eisner Amper Board of Directors survey.
At a holistic level, what is your company doing to avoid these types of crisis situations? And just as importantly, if an incident does occur, do you have a communications strategy in place that will guide your interactions with customers, employees, investors and other stakeholders? If you aren’t asking these questions now to get ahead, then it’s a lost opportunity to develop a more sound and robust brand.
The good news is that by examining what other companies went through as they responded to crisis, your organization can learn important lessons that will help ensure your brand stays ahead of the issue.
Look Around Corners
Most companies have crisis management plans in place, but make the mistake of not considering reputational risks holistically and reviewing what the entire organization is doing to avert problems. I wish I had a nickel for every time I’ve heard a client say, “We’re good at crisis planning, but we never saw this coming.”
The truth is that while planning, watching and learning certainly helps organizations prepare for crisis, in the end, those responsible also need a futuristic 360-degree view of sorts. During our recent industry panel, Bill Wohl, former CCO & SVP of Hewlett Packard and corporate communications and reputation expert, summed up the issue by describing a Chief Communications Officer job description he’d recently read: “(It) said the candidate would need to have the ability to ‘see around corners for what was coming ahead’ and ‘identify the invisible’.”
Be Transparent, Timely
So, if crisis comes knocking on the door, how should your organization respond? First and foremost, it should act quickly to gather data, develop a fact-based narrative and take control. Organizations in crisis are measured on their responsiveness and transparency. If all the facts aren’t yet available, companies should let stakeholders know that, and tell them how the organization plans to address the issue for the time being. The worst thing your company can do is disappear or go silent. This is especially true as it relates to communications with journalists. Organizations that direct reporters to web sites and drawer statements miss out on developing relationships with key stakeholders and forfeit the opportunity to have a real voice, rather than an FAQ, driving the story.
Learn from Others
Organizations that don’t borrow from other companies’ successes and learn from their failures are missing out on significant learning opportunities. Even those with a good plan must always be “looking around corners”, and considering future trends. Above all, a good crisis management plan never underestimates the value of a reputation.
Dan Soulas has more than 20 years of experience in the market research industry focusing on servicing the needs of corporate and PR agency clients.