Reputation management: practice, trends, public scrutiny, and recognition
Of the four classic functions of management: planning, organization, motivation, and control, it is the last of these that is the weakest in terms of reputation management in Ukraine.
A reputation-oriented, and even reputation-centric, business philosophy has long been common in the civilized world. As far back as the ancient philosophers, medieval knights, and entrepreneurs of the early capitalist period, public trust in an individual or organization has meant prosperity, and mistrust has led to serious problems. Today, in a world that is becoming increasingly transparent, hardly anyone would deny the importance of reputational assets - the economy itself has turned into an economy of trust.
However, those assets which are correct and good, and the language that defines them, are very vulnerable, and highly sensitive to populist speculations. Many people want to distort their meaning, use them in an incorrect context, and shift the coordinate system to swear black is white. This concerns reputation management as it is the most important management subsystem of any company.
Of the four classic functions of management: planning, organization, motivation, and control, it is the last of these that is the weakest in terms of reputation management in Ukraine. This is due firstly to misunderstanding the difference between image as superficial perception and reputation as deep knowledge of certain people or organizations. It is also the result of blurred boundaries between ‘good’ and ‘bad’ and a lack of clear evaluation criteria.
That is why episodic loud PR campaigns can help hide from the public real problems and risks in a company’s work for a while, and also why many business managers believe that a bad reputation need not impact negatively on the bottom line.
Tactically, they are right, but strategically, the world is moving in the direction of almost complete informational symmetry – everyone will know everything about everyone and everything in the near future. Moreover, as the system of social norms is changing, that which was acceptable yesterday becomes disapproved of today and condemned tomorrow. For example, bragging about predatory business methods or over-stating corporate charity contributions is not in trend.
That is why it is so important to define the benchmarks of ‘that which is good’ in relation to reputation management. Today, it is no longer necessary to come up with a clever or original idea for a business process. The National Corporate Reputation Management Quality Rating of ‘Reputation ACTIVists’ is intended precisely to ensure public recognition of the merits of companies that truly demonstrate a systematic approach in practice. That is, they are able to:
consider reputational risks and find sources of reputational benefits within the company;
conduct continuous communication with the target audience that is significant for them in all necessary formats based on business goals; obtain useful feedback from society.
A significant proportion of these companies are international corporations that already work according to the principle, “I exist. Therefore, I manage my reputation.” But many purely Ukrainian business structures have evolved and learned to effectively use the tools of reputation management without foreign prompts. They deserve honour, praise and recognition on March 29 this year at the solemn ceremony honouring ‘Reputation ACTIVists 2018.’
Reputation Management Functions
Microeconomic level (company)
Planning – development and implementation of relevant strategies and planning documents over different temporal horizons.
Organization – design and regulation of the Reputation Management business process.
Motivation – creation and application of efficacious incentives to ensure the work of participants in the Reputation Management business process is effective.
Control over compliance with the strategic vector of development and execution of plans.
Macroeconomic level (society)
Planning – development and documentation of strategies at the national level (improving the investment image; reputation of government institutions in the eyes of the population etc.).
Organization – the creation and functioning of an organizational mechanism for the implementation of strategies.
Motivation – the creation and application of effective work incentives for actors in organizational processes and society in general.
Reputation control:
public encouragement of reputable actors (public figures, companies), which brings them reputational dividends and material benefit; public condemnation of disreputable actors, which causes reputational and material damage.
10 Trends in Reputation Management from Olena Derevianko in ‘The World and Ukraine’
Customization of communications
Thanks to modern digital technologies and Big Data processing methods, there is a real opportunity to reach a specific addressee and tailor your engagement by taking into account their preferences and prejudices.
Personalization of trust
People are looking for reliability in a world of chronic infobesity and the credibility gap. This can be provided by individuals (owners; senior managers of businesses; celebrities) who are directly associated with certain corporate and product brands.
Engaging opinion leaders
Social media has made most existing opinion leaders visible and spawned new ones. Of course, these are not necessarily experts, but simply transmitters, amplifiers, and repeaters of certain messages. For companies, their loyalty is an important aspect of communication and is achieved via various methods ranging from persuasion to direct monetary reward. In many cases, this can create new reputational risks and damage the strategic vector of PR work.
Fragmentation of the information space
When social networks become a forum for direct communication between opinion leaders and the public, each of them automatically becomes a mini-media, which is often many times more powerful than ordinary media. Nowadays, the contributions of experts and popular users on social networks provide material for the ordinary mass media which is rapidly losing influence due to its insufficient flexibility, outdated financial models and the influence of beneficiaries on editorial policy.
Civil and expert journalism
As the authority of traditional mass media declines, journalists are looking for new areas to investigate and new approaches to develop their careers. As a result, the best content is created by columnists or derived purely from expert opinion without a meaningful journalistic perspective. The domestic incidence of transforming politicians and businessmen into TV presenters is one manifestation of this general trend (notwithstanding, of course, that this might concur with individuals’ personal goals). In fact, professional journalism has largely subordinated itself to civilian and expert output.
Special media projects and paid content
Due to the financial problems of traditional mass media and the withdrawal of professional personnel from the industry, the highest quality content is, paradoxically but inevitably, either expert (see point 5) or paid. Native advertising, special projects, unmarked advertorials, and subjective materials which do not observe the professional standards of journalism, are published at the expense of external commercial and non-commercial donors, and have become standard practice for a great deal of mass media, both traditional and newly-created, which declares a commitment to high ethical standards.
Shady social media (messengers etc.)
The ‘dark’ side of social media is growing rapidly. Some users, disappointed with the content of social media feeds, choose niche thematic channels on messengers and return to e-mail in order to use their time more efficiently.
Artificial intelligence is already here
Chatbots in corporate communications represent the first real appearance of AI in the PR industry. In the near future, we will see the use of AI (Artificial Intelligence) in the execution of various sub-business processes of reputation management.
Internal communications are under a magnifying glass
Increasing transparency in the business environment and the development of social media of all types naturally force companies to pay more attention to internal communications. An employee can be a brand ambassador or its destroyer/detractor depending on how well this communication is managed. Hence there is serious attention being paid to corporate mass media and other forms of interaction with personnel at the nexus of HR and PR practice.
Strategic efficiency is no less significant than financial
Although the work of PR teams continues to be measured, as it always has, against KPIs from which PR value can be calculated, voices are being increasingly raised advocating a common sense approach. In today’s complex information space, it is extremely important to ensure that the achievement of quantitative PR goals does not interfere with the maintenance of a stable long-term reputation and strategically significant positioning for the beneficiaries.
Focus,2018