“A good reputation is more valuable than money.”
~ Publilius Syrus, Roman writer 85-43BC
Remember the movie ‘Can’t Buy Me Love,’ starring teenage Patrick Dempsey? What a great film. For me, the storyline of this 80’s romantic comedy outlined one of the first examples that I can recall of an intentional attempt to build reputation. Patrick Dempsey, a typical high school geek, is looking for a way into the ‘cool crowd’. Through a series of events he discovers that his gateway into the social elite is by paying the most popular girl in school to hang out with him. By creating the perception of a relationship with a ‘cool’ girl and latching onto her already well-established ‘cool’ brand, his reputation skyrockets from dud to stud. Of course turmoil ensues when the couple’s secret agreement is uncovered. However, at the end of the day, girl falls in love with boy’s true character and despite his low social standing they are able to drive happily into the sun set on a riding lawn mower. Precious.
Though a bit of a stretch from reality, all the basic lessons are there: character is who you are, defined by what you do; brand is the persona you present; and reputation is how the outside world perceives the sum of these two things. Whether applied to a fictional movie character or a global corporation, the root of these definitions remains the same.
What we know about reputation is that it is valuable. Though an intangible asset, a good reputation can produce any number of tangible benefits. From building affective and behavioural loyalty, to attracting and retaining top talent, to enhancing goodwill or helping to sustain an organization through tough times. Though an organization cannot fully control the direction its reputation takes, it can certainly cultivate the right character and brand to assist in creating the desired, and hopefully accurate, perception from its stakeholders.
The character of an organization is intrinsically rooted in its values and beliefs. It is composed of the attributes and features that make-up an organization, setting it apart from its competitors. Character is reflected in they way an organization conducts itself, both publically and privately. It is the true nature of a company, before public perception is formed and after it is stripped away. When viewing character in regards to public relations, Robert L. Heath and Lan Ni tell us “(an organization’s) character depends on how well it can align its interests with those of consumers, audiences, and publics.” More simply defined by Basu and Palazzo, “character is the way an organization goes about making sense of its world.”
Though the nature of character does not concern itself with peripheral opinions and beliefs, reputation does nothing but. Merriam-Webster dictionary defines reputation as being the “overall quality or character as seen or judged by people in general.” Though a reputation may be reflective of character, it is not always an accurate representation. An organization may do everything within its power to engineer a reputation for itself, but at the end of the day reputation belongs in the eyes of the beholder. Perception may not always result in truth, but it will certainly be the root of reputation. American basketball coach, John Wooden summarized it best when he said, “Be more concerned with your character than your reputation, because your character is what you really are, while your reputation is merely what others think you are.”
Like character, brand is another tool created internally to support reputation. An organization’s brand is its public face, encompassing the goods and services provided to differentiate it from its competition. Defined by the American Marketing Association as “a name, term, design, symbol or any other feature that identifies one seller’s good or service as distinct from those of other sellers. A brand may identify one item, a family of items, or all items of that seller.” With this in mind, brand also has the capability to represent a set of standards to which a company should strive to maintain or surpass. The institute for public relations states that, “A good corporate brand, helps to identify the core competencies, assets, values and key attributes of the organization.” This can allow an organization the opportunity to expand its reputation beyond the original goods or services provided.
Understanding the importance of reputation effects how business is conducted, how objectives are achieved, and how an organization will present its deeds and misdeeds to its publics. Doorley and Garcia define reputation with the formula:
Reputation = Sum of Images = Performance + Behaviour + Communication
Though it may look simple enough, if a single element of performance, behaviour or communication is askew, a reputation can quickly move from strong to weak, good to bad, bad to worse. In discussing reputation for the Institute for Public Relations, Elliot S. Schreiber examines reputation from the points of view of the organization and the stakeholder: “From the perspective of the organization, reputation is an intangible asset that allows the company to better manage the expectations and needs of its various stakeholders, creating differentiation and barriers vis-à-vis its competitors. From the perspective of stakeholders, reputation is the intellectual, emotional and behavioral response as to whether or not the communications and actions of an organization resonate with their needs and interests.” Schreiber goes on to say that, “Reputation may be the most important asset entrusted by shareholders and boards to the CEO and management team. As an intangible asset, reputation can help frame and manage expectations, needs and interests of stakeholders, and can be used to create barriers to competition. Squandered, it is an asset that is difficult to rebuild since it is based primarily on perceptions and realized or unrealized expectations.”
Reputation is so vulnerable to outside factors. Though the best approach to achieving a good reputation is transparency, integrity, and an alignment with stakeholder concerns, an organization can only go as far as building a foundation from which the hope is a good reputation will emerge. The Arthur W. Page society defines a ‘good reputation with the public’ as being established in the public mind as an institution of character that functions in the public interest.
When comparing the ways reputation has been defined, the common thread is the idea that a character reflective of organizational values will be the largest contributing factor to building a reputation. If a company claims be practicing corporate social responsibility but fails to engage in a dialogue with its community stakeholders, its eventual reputation will reflect its inconsistencies. However, if an organization employs best business practices, both internally and externally, with integrity and a genuine interest in aligning its goals with those of its publics, then its reputation will be a valuable, and hopefully profitable, asset.
When all is said and done, my preferred definition and understanding of reputation comes from The Arthur W. Page Society’s guiding principles address the foundation of reputation by simply stating: Prove it with action. Public perception of an organization is determined 90 percent by what it does and 10 percent by what it says.