Archive for September, 2012
Not surprising but always important to remember that reputation can deter customers away from something as basic as a checking account or other product. In a survey by Datamonitor’s Financial Services Insights group, consumers in the U.K. – a large 78% or just imagine nearly 8 in 10 – say that a bank needs an untarnished reputation for them to use them. This high figure is up from 53% in 2011. That is a very large jump in perception on the importance of reputation in the banking sector. Clearly, the banking scandals of the past 12 months or so have hurt the reputation of the banking sector in the U.K, if not all around the world. I wish I could find the link to the actual report but when I looked, the reports were expensive so this link that reports the finding will just have to do. Regardless, the point is made. Consumers are increasingly thinking about whether their banking institutions have a good reputation or not before they decide to do business with them. Years ago, it would have been unheard of for an institution like Lehman Bros. to close down. Since that catastrophic event and the many others that followed, consumers do not want to take any chances. That’s clear.
Thoughtful interview in strategy + business with the former CEO of Campbell Soup, Doug Conant. His internal focus on the Campbell culture was refreshing. He realized soon after joining and surveying employee engagement that one out of every three employees was looking for a job. As he said, nearly 6,000 of the 20,000 employees at Campbell’s were dissatisfied. He knew what needed to be done with results like that. Here are two quotes that illuminate his thinking: “I also knew that you can only win in the marketplace if you win in the workplace first.” Also, “You can’t talk your way out of something you behaved your way into. You have to behave your way out of it.” He is dead right. Employee satisfaction has to be taken seriously if a company wants to succeed and build the best reputation that it can. When I was recently in Brazil, the head communications person at one of the largest banks in all of Latin America told us that they strategically decided to put employees first in their line of stakeholders.
I also wholeheartedly agree with Conant that leadership has to own its behavior. Words are critical today, especially when you have employees all over the globe, but if actions do not match the words of leadership, your employees will be the first to know and tell others that this is a company that does not walk the talk. Interestingly, Conant instinctively knew that to get the front-line engagement he needed to turn the company around, he would need it from his top people. So he set his sights on getting them “wildly engaged” in the work.
Conant has written a book titled Touchpoints. The basic idea is that every contact is a chance to make that tangible, meaningful connection with others. It is about that quality interaction that can advance the business and enhance satisfaction. Conant talks about the 10 to 20 handwritten notes he sent out as CEO every day – 30,000 over a 10 year tenure. I know about those notes. I got one. They made the connection and to this day, I have not stopped talking about my shock receiving his handwritten thank you note for spending time with me discussing CEO reputation.
I have been traveling in Brazil and Peru for business to talk about reputation. It was a terrific visit because I confirmed once again that reputation is on the agendas of most companies wherever they may be. One of the challenges I heard several times on my visit was how non-U.S. companies do not have to deal with government relations as much as LatAm companies do. This challenge to reputation-building came up as well in several media interviews I did prior to my trip. Each time it came up, I had to chuckle. The truth is that government involvement and regulations in US markets also feel very real and intrusive. I always talk about how government used to be an “invisible hand” but today plays a decidedly “visible hand” in business affairs. For many companies, it is literally like a new line of business. In fact, I have been asked several times nowadays how government affairs departments are being restructured to more effectively manage upcoming policy and government regulations.
I was in Sao Paulo and Rio de Janeiro for two seminars on reputation management. In our research on corporate reputation, 91% of executives in Brazil told us that they were increasing their efforts at reputation building. Much of the discussions in the Q&A period in addition to government intervention centered around culture, B2B reputation-building and dealing with social media threats. In one market, we also discussed social CEOs, a favorite new topic of mine. Apparently there are fewer socialized CEOs in LatAm than in the U.S. due to security issues I was told. I found that illuminating.
When I was in Lima this week at an evening reception, I had a discussion with two businessmen who told me how optimistic they were about business growth in Peru. They were noticeably ebullient. Considering their past history, they said they had never seen so many doors opening to them. There seemed to be no ceiling on their optimism about the future. Refreshing.
As always when I travel, I catch up on magazines because I find myself on planes. I caught an article in The Economist that ties into this post’s train of thought. One line particularly stood out…”…place matters more than ever in a globalized world.” The writer was making the point that in a global world where everything has become so homogenized (like “a universal airport lounge”), people crave a sense of place and the more distinctive, the better. While I was in Brazil and Peru, it felt like there was a definite pride in their “place “for being different than the U.S. and other regions and for the boundless opportunities ahead. That could only be a good thing for sparking innovation, building top flight reputations and surprising the global competition.
I was thinking of new trends in the reputation space today. And I was thinking about how reputations can easily be formed, shaped and cultivated through crowds. If a crowd on Twitter or Facebook organizes to give a high five sign (I presume that means thumbs up), to a company or brand, its reputation gets a lift. And if the crowd does not think highly of a particular company’s words or deeds, the collective force of that crowd online can demolish a reputation. Is this some form of crowdrepping that I should be paying particular attention to? I think so. It often feels as if the crowd is deciding whether a company gets five stars instead of three or if it gets a complete Do Not Pass Go (that’s from Monopoly). Just musing for the afternoon.