The latest edition of Powerlines, REPUCOMM's e-mail newsletter about strategic reputation and crisis management is now available by request.(REPUCOMM is the name of my consulting practice).
It contains articles entitled "Avoid Reputation Risk when contracting with the Government; Are you managing your Online Reputation?; Redesign your Business from the customer's point of view; Why should you train your staff in Reputation awareness?" as well as our latest news and random thoughts.
This notification is sent to you in the interest of your organisation's biggest asset and risk - its reputation.
If you would like a copy to read, just send a mail to deonbin@icon.co.za
Wednesday, 13 December 2006
What is the Golden Thread?
The magazine Fast Company is running a brilliant slide show depicting how some international brands faced a crisis and rebounded.
Visit http://tinyurl.com/yk2vyy to view the slide show.
Unfortunately the slideshow does not paint a true picture of the damage and impact the crises had on the organisations, but it does encapsulate briefly the response taken.
What is the golden thread amongst these examples in your opinion?
Every one of these examples clearly show that an organisation can make lemonade out of lemons, i.e. deal positively with any crises and issue , if they think through the process clearly and never loses sight of the vision and values of the organisation.
Howver for me, the golden thread is Prevention. Prevention is better than cure! Proactive Crisis Management is still better than post-event reactive management,
Visit http://tinyurl.com/yk2vyy to view the slide show.
Unfortunately the slideshow does not paint a true picture of the damage and impact the crises had on the organisations, but it does encapsulate briefly the response taken.
What is the golden thread amongst these examples in your opinion?
Every one of these examples clearly show that an organisation can make lemonade out of lemons, i.e. deal positively with any crises and issue , if they think through the process clearly and never loses sight of the vision and values of the organisation.
Howver for me, the golden thread is Prevention. Prevention is better than cure! Proactive Crisis Management is still better than post-event reactive management,
Introduction to my Blog
The word "insulation" means to protect. This blog will be a must-read for any Reputation manager, PR professional, Risk manager and Corporate Affairs executive.
It is my aim with this blog to make management realise why damage to Reputation is the number one risk organisations face worldwide and to assist them to design and implement robust reputation risk management frameworks that will protect against the destruction of this asset.
Numerous studies including the Corporate Risk Barometer survey by the Economist Intelligence Unit have shown that the most significant issues facing business today, are reputational risk (defined as the threat of any event that can damage a company's reputation) and regulatory risk (defined as problems caused by new or existing regulations).
These two risk categories received the highest scores in the Risk Barometer, indicating that they are seen as more significant issues than market risk, foreign exchange risk and country risk by the majority of executives in the survey.
Why should organisations protect itself against Reputation Risk? Unfortunately many companies damage their carefully crafted reputations either inadvertently or through blatant and incredulous acts.
Most of the damage occurs when there is not a careful crafted strategy for building, sustaining and protecting the organisation's biggest risk and asset - its reputation.
The new order of the day seems to be accounting principle restructuring, companies seeking to improve trust building, governance and ethics principles and practices, stakeholders seeking disclosure and shareholders becoming more and more frustrated.
Yet, there still seems to be a general lack of understanding the true value and potential of an organisation’s reputation. And, as long as management do not understand how reputational risk manifests negative articles and doubt about company practices will continue to dominate headlines.
Unwanted actions and negative publicity leads to reputation risk. And reputation risk manifests when perceptions and opinions are influenced by negative experiences, impressions, beliefs, feelings and knowledge that stakeholders have about a company. It often results in loss of sales, share value decreases and breakdown of relationships.
Companies should be asking themselves about what actions they are taking to protect and insure their good name against all types of crisis – especially those that are sudden, smouldering and perceptual !
More and more companies are finding that their once hidden “smouldering crises” are now becoming fully-fledged combustible crises. (A smouldering crisis is any serious business problem which is not generally known within or without the organisation, which may generate negative news coverage if or when it goes “public” and could result in fines, penalties, unbudgeted expenses or unwanted scrutiny).
The damage of a reputational crisis can be direct and indirect. These costs could include penalties incurred because of a lack of legal compliance, litigation, media conferences and advertising costs and the hiring of crises communication consultants to put forward positive messages after the wrongful deeds. BUT what about the indirect costs, the effects on various stakeholders? The customers that do not return or stakeholders that takes their business interests elsewhere?
I believe that managers have both a professional and a moral duty to try to protect their company’s reputation. The way to minimise their company’s reputational risk is to be vigilant and report anything, which they believe, could erupt into an issue of unwanted publicity and to act to rectify it. But they can only do that if they understand what reputation is all about and how it can be managed and damaged.
I therefore assist companies with minimising and mitigating reputation risk and advise them on how to react and manage any crisis or issue that might destroy reputation, relationships and market share. A large part of my work involves speaking at conferences, capacity building by facilitating workshops around the globe on Reputation, Crisis Management and Crisis Communication response and helping organisations design and implement robust reputation risk management frameworks.
It is my aim with this blog to make management realise why damage to Reputation is the number one risk organisations face worldwide and to assist them to design and implement robust reputation risk management frameworks that will protect against the destruction of this asset.
Numerous studies including the Corporate Risk Barometer survey by the Economist Intelligence Unit have shown that the most significant issues facing business today, are reputational risk (defined as the threat of any event that can damage a company's reputation) and regulatory risk (defined as problems caused by new or existing regulations).
These two risk categories received the highest scores in the Risk Barometer, indicating that they are seen as more significant issues than market risk, foreign exchange risk and country risk by the majority of executives in the survey.
Why should organisations protect itself against Reputation Risk? Unfortunately many companies damage their carefully crafted reputations either inadvertently or through blatant and incredulous acts.
Most of the damage occurs when there is not a careful crafted strategy for building, sustaining and protecting the organisation's biggest risk and asset - its reputation.
The new order of the day seems to be accounting principle restructuring, companies seeking to improve trust building, governance and ethics principles and practices, stakeholders seeking disclosure and shareholders becoming more and more frustrated.
Yet, there still seems to be a general lack of understanding the true value and potential of an organisation’s reputation. And, as long as management do not understand how reputational risk manifests negative articles and doubt about company practices will continue to dominate headlines.
Unwanted actions and negative publicity leads to reputation risk. And reputation risk manifests when perceptions and opinions are influenced by negative experiences, impressions, beliefs, feelings and knowledge that stakeholders have about a company. It often results in loss of sales, share value decreases and breakdown of relationships.
Companies should be asking themselves about what actions they are taking to protect and insure their good name against all types of crisis – especially those that are sudden, smouldering and perceptual !
More and more companies are finding that their once hidden “smouldering crises” are now becoming fully-fledged combustible crises. (A smouldering crisis is any serious business problem which is not generally known within or without the organisation, which may generate negative news coverage if or when it goes “public” and could result in fines, penalties, unbudgeted expenses or unwanted scrutiny).
The damage of a reputational crisis can be direct and indirect. These costs could include penalties incurred because of a lack of legal compliance, litigation, media conferences and advertising costs and the hiring of crises communication consultants to put forward positive messages after the wrongful deeds. BUT what about the indirect costs, the effects on various stakeholders? The customers that do not return or stakeholders that takes their business interests elsewhere?
I believe that managers have both a professional and a moral duty to try to protect their company’s reputation. The way to minimise their company’s reputational risk is to be vigilant and report anything, which they believe, could erupt into an issue of unwanted publicity and to act to rectify it. But they can only do that if they understand what reputation is all about and how it can be managed and damaged.
I therefore assist companies with minimising and mitigating reputation risk and advise them on how to react and manage any crisis or issue that might destroy reputation, relationships and market share. A large part of my work involves speaking at conferences, capacity building by facilitating workshops around the globe on Reputation, Crisis Management and Crisis Communication response and helping organisations design and implement robust reputation risk management frameworks.
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