The business case for reputation

TODAY nebusiness launches a new series looking at the reputation of business.

Today nebusiness launches a new series looking at the reputation of business. As North East companies look to rebuild after the recession, what people think of your business has never been more important. Over the coming weeks and months, Reputation Matters will look at how you can help build the reputation of your business - and highlights North East firms leading the way.


If you want your business to have a good reputation, you must ensure it permeates right through the organisation, says Joanna Berry.

"Lose money for my firm and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless." - Warren Buffet.

Reputation Matters

SO HOW would you define reputation? What others think of you? How you “come across”? Whether you are trustworthy?

These are all important elements of your personal reputation, but they are also more relevant to business today than they have ever been. For a company, whatever its size, a good reputation is becoming an increasingly important element of their competitive advantage over others in their sector.

In a market environment populated by increasingly empowered customers who have more choice and flexibility in their purchasing decisions than ever before, and who can easily find alternatives to what you offer, your reputation can be the single most important factor which attracts them to you, keeps them with you, and persuades them to tell their friends about you.

Reputation has been called by academics “a collective representation of multiple constituencies”. Whatever that means to you, most definitely reputation is NOT about a self-promoted message.

Reputation is gained, maintained, enhanced or detracted from over time, and it’s a two-way process: Greggs have spent over 70 years consolidating their “reputation for good quality and great value”. It is important to note that ‘brand’ ‘identity/image’ and ‘reputation’ are not interchangeable. Reputation is, unlike the other elements, a two-way street. You have to ask not just yourself, but also all the stakeholders involved: “’What do all the stakeholders in my company think of who we are telling them we are and what we have done to prove that?”

The thing about reputation is that you can’t make it up, nor can you create it overnight. ‘Reputation management’ is a topical buzz word – and increasingly, job description – which implies just that. However if not very carefully integrated over time into daily corporate practice at all levels, with real authenticity and sincerity, trying to manage your corporate reputation is just like managing your own personal popularity. As many tales of celebrities in the fields of film, sport and entertainment have recently testified, that’s an awkward, superficial and potentially self-defeating activity.

A good corporate reputation depends upon some fundamental principles. Employees and management from CEO down need to be absolutely obsessed with the product or service that they represent. They need to work for and deserve the confidence of their consumers.

They must be available where and when their consumer requires them to support the marketing and sales activities of the company. If a mistake is made, the company’s reputation will depend upon admitting that mistake frankly and up front, and doing something about it, not trying to sweep it under the carpet: Toyota’s recent tribulations remind us of that.

Nobody is perfect – individual or corporate – and consumers know this. But that does not mean that they are prepared to be lied to for short term peace of mind. Companies must engage their consumers’ interest, and have something to say to them which adds value to their purchase decisions.

Over an eight-country investigation, researchers have identified the most important influencers of corporate reputation, which we will be assessing during this series on corporate reputation here in the North East.

At the top of the list of influencers came customers, closely followed by employees at all levels. Thirdly, and of increasing importance, the influence of the chief executive officer has increased. A good reputation precedes and helps business grow internationally, so the reputation of the CEO and their company are increasingly intertwined, as Fabio Capello recently proved (and John Terry found out to his cost).

Managing reputation is a key responsibility, which has to be led by the CEO and implemented in an integrated manner. Of later interest are other influencing factors such as print media, shareholders, the internet, policy regulators and broadcast media. But the primary influencers – the consumer, employees and the CEO – are key to the successful implementation of a reputation strategy which will have deep rooted, long lasting and meaningful effects.

Joanna Berry is a lecturer in marketing at Newcastle University Business School and vice-chair of the regional board of the Chartered Institute of Marketing

:: Click here to Complete the Reputation Matters survey online

What people are thinking

BUSINESSES today need to think about how they are perceived not just by their customers, but by a whole range of stakeholders.

Daniel O’Mahoney, of Bradley O’Mahoney public relations, which specialises in reputation management and branding, said that keeping a low-profile was not an option for a business with big ambitions.

"Organisations in the public and private sectors need to continually monitor and evaluate their reputations amongst key stakeholder groups," he said.

"In the past, customers were regarded as the only priority, but that is no longer the case. Employees, suppliers, the media, investors, the community in which an organisation is based, are all ingredients within the stakeholder environment. Organisations that are looking to grow and develop must understand how they are perceived by all of these groups."

He said "stakeholder mapping" – keeping abreast of what people think of your business – was essential to protecting and enhancing your reputation.

"There is no doubt that companies with great reputations attract great staff and retain those that they already have," he said. "Likewise, those with poor reputations suffer poor internal morale and will see a negative impact on sales – especially in consumer markets.

"In the past, it was possible for organisations to protect themselves from the outside world by simply keeping a low profile. That is no longer the case. The internet, social media channels, pressure groups and consumers that are more critical and discerning than they were even just 10 short years ago, means that organisations are discussed and talked about all of the time by interested stakeholders. Some of this will be positive, some negative.

"There are many who are already doing great things to enhance their reputations purely by the passion that they have for the products and services they provide and the relationships they build with those they interact with.

"Through this initiative with The Journal we urge businesses and organisations to stop, listen and monitor what people are saying about them and then put in place strategies to manage their reputations."

:: Click here to Complete the Reputation Matters survey online

Get involved

THE Journal wants to know what businesses in the North East think about reputation.

Does anyone in your organisation have direct responsibility for managing reputation?

Do you think all members of staff understand the importance of reputation?

Do you really know what suppliers and customers think of your business?

During the past 12 months has your business had to deal with issues that might have affected its reputation?

Name one company based in the region that you believe has a great reputation.

We will also be highlighting examples of firms that have done something to enhance their reputation.

If you would like to nominate a business for our Reputation Matters series, then send the name of the company plus details of what they have done (maximum 150 words) to  

Our expert panel will look each month at the nominations and feature one outstanding company in the pages of nebusiness and on our website.

:: Click here to Complete the Reputation Matters survey online

Going global

NORTH East companies are increasingly developing their own global brands and are thus enhancing the reputation of the region’s business community, according to one business leader.

James Ramsbotham, chief executive of the North East Chamber of Commerce, is backing the Reputation Matters campaign.

He said: "We in the North East an increasingly diversified, dynamic and exciting collection of businesses in many sectors who believe passionately in what we do and how we do it. As a result we are increasingly developing brands which have national and global reputations, with many examples highlighted in these pages.

"You can sense the commitment and passion. These businesses demonstrate an understanding of the importance of growing their reputations as a key tool for business success."

He said reputation was a "lagging indicator" – it says everything about how you have performed in the past as a signpost for how you may perform in the future. "In order to maintain the highest reputation, continual improvement is crucial," he added.

"Competition in business is good. It ensures that we continue to strive to improve, to innovate, to deliver the very best service, and to differentiate.

"Branding is central to much of this, but brand management is rarely done brilliantly. When it is done effectively it makes the statement that ‘anyone can do what we do, but no one can be who we are’.

"We have worked hard across the North East to establish ‘who we are’ and we must continue to grow our reputations in this regard. There are many excellent role models in and we shall continue to work hard and ensure that they continue to thrive, so enhancing people’s perceptions of the North East as a great place in which to do business. Their brands are our collective brand."

:: Click here to Complete the Reputation Matters survey online


David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer