According to a recent study by Burson-Marsteller, 80 percent of the more than 600 executives surveyed believe that there is a greater threat to corporate reputation today than there was two years ago. In other words, a reputation crisis—while not inevitable—is a challenge that virtually every company ought to anticipate, prepare a defense for, and strategize to avoid.
The good news is that, according to current research, there are a number of successful, proven approaches to take. The findings also suggest that an integrated communications strategy aimed at all key stakeholders, using a variety of channels and a range of vehicles, will speed up the process of recovery.Five-Step Program
We looked at the drivers of CEO and corporate reputation and the turnaround strategies companies use to protect, manage, and build their reputations. According to global business leaders surveyed, there are five key steps to fixing a damaged reputation:
Make progress transparent When Merck pulled Vioxx off the market in the fall of 2004, it did so swiftly and openly, while making a very public recommitment to patient safety. CEO Raymond Gilmartin appeared on CNBC and high-profile board members reached out to the media.
While Merck continues to address litigation, it also continues to be open and candid about its course of action and commitment to conducting business in the best interest of patients.
Transparency, coupled with honesty, is the best strategy for protecting a company's reputation.
Be accessible When Schering-Plough began to address the financial challenge posed by the expiration of its Claritin patent, new chief executive Fred Hassan embraced a communications strategy with the goal in mind of delivering to key stakeholder groups, like patient advocates, messages of innovation, growth, and commitment to safety.
Hassan, the model of an accessible CEO who engages employees and responds to their inquiries both in person and on-line, said, "We have 32,000 publicists right here in our company."
Show success in ways that resonate with stakeholders GSK is leveraging its US sales representatives, 8,000 in all, as public relations ambassadors, providing them with a message platform and encouraging them to arrange to speak with community groups in their hometowns and neighborhoods. Putting a local face on the company, its products and its market presence creates an emotional connection that resonates and builds credibility. If and when bad news arrives, the ambassadors can do much to mitigate its impact.
Recognize the value of socially responsible engagement Takeda Pharmaceuticals North America (TPNA), the US-headquartered subsidiary of the Japanese pharma leader, has made reputation-building a key objective since the company's creation in 1998, and chose as a tactic its commitment to corporate citizenship at the local level. In each of the last three years, the company has been able to help identify under-resourced Waukegan, Illinois, schools that have welcomed TPNA employees' help in painting, refurbishing, and landscaping the building and surrounding grounds. TPNA wanted to be seen as an employer of choice, and the workforce reaction to both events was overwhelmingly positive, according to the company.