Best Places to Work

Just read Gallup’s new State of the American Workplace study which is about employee engagement. Several findings jumped out at me in terms of reputation. Gallup found that approximately 30% of employees are engaged while the remainder (70%) is actively disengaged or just not engaged. When you think about getting your employees to “live the brand or reputation,” companies are limited as to what they can do when the majority of their workforce is basically not present. Another revealing finding focused on how well employees really understand their brand’s being. Only 41% felt that they know what their company stands for and what makes it different from competitors. Thus, 59% are fairly clueless despite all the communications directed at them on vision, mission and values. Fairly disturbing when you think about how harnessing that knowledge could boost reputation. And imagine what happens when an employee who does not understand what the company is about collides with a customer. Not a good picture. Not good for reputation-building. The solution is for leaders to do a better job of making sense of what employees are doing from 9 to 5.

Each year Fortune publishes the 100 Best Companies to Work For in the U.S. While the bulk of the company evaluation rests on a comprehensive employee survey, Fortune publishes a wealth of employer statistics about benefits, diversity and jobs. Weber Shandwick has been cataloguing this data since 2006, enabling us to look at how each factor is changing over time and how reputations can be shaped by being a best company to work for.

Most Best Company statistics for jobs, diversity and benefits were unchanged between 2012 and 2013. However, this leveling off could be taken as a sign of good news. 2010 and 2011 were mediocre years for jobs and the improvement in job and diversity statistics in 2012 suggested that the market was starting to strengthen and reputations are stabilitzing. Similar numbers in 2013 may signify that improvement is still underway.

Below are insights into these jobs, diversity and benefits trends:

Jobs: The Best Companies reported virtually the same job statistics in 2012 and 2013, including median job growth (6%) and median voluntary turnover (7%). In fact, with the exception of 2010 and 2011 which were poor years for jobs statistics, median job growth has maintained a steady rate since 2006, only fluctuating between 5% and 7%. Perhaps this job growth range is a Best Company standard.

Improvement in negative growth may be a sign of recovering job market. After hitting a low last year (11%), the number of companies experiencing negative job growth remained steady in 2013 (12%). This is a drastic improvement from 2011 when 45% of Best Companies reported negative job growth.

The rate of Americans quitting is on the rise, suggesting that people across the country are becoming more confident in leaving their jobs to find work elsewhere. Best Companies, however, maintained the same voluntary turnover rate between 2012 and 2013 (8%). The difference between these two trends may reflect the impact that a good reputation can have on retaining a company’s workforce.

Diversity: Diversity initiatives at Best Companies have also remained mostly unchanged. The average percentage of women and minorities working at Best Companies has been consistent since 2008. But with women already comprising, on average, nearly half the Best Companies’ workforces, it is very possible that we will see this trend continue into the coming years. 2013 was another solid year for gay-friendly policies and benefits. Nearly all Best Companies this year have gay-friendly policies (99%) and the number of those offering gay-friendly benefits has hit a record-high (93%).

Benefits: The most noticeable change in employee benefits offered by Best Companies since last year is the decrease in number of companies extending compressed workweeks (down from 80% in 2012 to 73% in 2013). Also taking a small hit is on-site childcare, which fell below 30% for the first time since 2008. The Fortune evaluation, however, does not look at companies that offer flexible workweeks, which could be taking the place of these two benefits. Best Companies could be giving employees the opportunity to better balance their work lives outside of a formal perk. We may be starting to see this trend happening at companies not on the best-of list too. For example, while Yahoo CEO Marissa Mayer was recently in the media spotlight for banning working from home, it is possible that Yahoo employees have other options for work flexibility aside from telecommuting. The benefit with the greatest improvement is on-site gym, which hit a high this year (73%). All other perks remained largely unchanged from 2012.

It is that time of the year. Last day of 2012 and the start of a new 2013. I posted an article to Huffington Post on what I see ahead by looking backward at reputation trends bubbling up and trends on the vast horizon.  Here is the post if you want to settle into the new year with a clear lenses on reputation possibilities.

Wishing you a happy new year!

It is November and I remembered that the World’s Best Multinational Companies to Work For list must be out. I went to the Great Place to Work Institute and there it was. The list was released last week. I have to say that between Hurricane Sandy, the election and the Noreaster we had in New York, we lost two entire weeks to chaos. So I must have missed the awards announcement on November 12th.

To make it to this premier ranking is not easy. Companies have to meet the following criteria — chosen from 350 companies, appeared on at least five national Best Workplace lists, have at least 5,000 employees worldwide and have at least 40% of the workplace based outside the home country.

Some of the amazing facts about these companies are:

• On average, returning companies on the World’s Best Workplaces list increased their revenue by 9% this year.
• Over the past 12 months, these 25 companies created 120,000 new jobs globally.
• Furthermore, voluntary turnover at 15 of the 25 companies was at 8 percent per annum, compared with the all industry average in the United States of 9.1%, according to CompData Service.
• Country with the most companies on the list — Mexico.
• Average number of national list recognition awards — nine
• Percent of women in executive/senior positions — 27%
• Greatest improvement in Trust Index — work/life balance, professional development
• Region with the most companies on the list — Europe
• Most represented industry on list — Manufacturing and Production

The reputation of the companies on the list are all stellar. I am, however, trying to understand why the logo of this award uses a dinner plate. Or am I being too literal? Perhaps it is the dinner plate from a white-tie dinner. You think?

You have probably read enough about our survey The Company behind the Brand: In Reputation We Trust. The first segment of the study, released in early 2012, reported on the growing interdependence of product brand and corporate reputation. The findings alerted marketing and communications executives to a tectonic shift in communicating the voice of the “enterprise” to key stakeholders. The survey, conducted with KRC Research, was among nearly 2,000 consumers and executives in two developed markets (U.S. and U.K.) and two developing markets (China and Brazil). The second release focused on CEOs and their role in reputation-building from the viewpoint of consumers and executives. This third release, just issued today, explores how executives in companies that market their products under multiple brand names differ from those companies who market mostly under one single brand name in their approach to building reputation. It addresses why it may be critical for product brands to be transparent about their ownership, even in cases where a company has made thoughtful and strategic decisions to lessen the exposure of the corporate brand.

We learned that 75% of executives at companies that manage products under multiple brand names now believe that a strong parent brand reputation is as important as the company’s individual product brands. As I was quoted in today’s release and executive summary: “Historically, multi-brand organizations more extensively marketed their product brands over their corporate brands, but their future success might entail determining how to bring the corporate brand forward to realize the full potential of all their reputational assets.”

I always get asked what surprised me. First, despite the advantage of leveraging the parent brand to enhance the reputation of the product brands, the survey found that many multi-brand executives aren’t fully embracing consumers’ increased scrutiny of the company behind the products they buy. While more than eight in 10 single-brand executives recognize that consumers are increasingly checking labels and doing research to identify the company behind the brand, significantly fewer multi-brand executives recognize how proactive and discerning consumers are about what they buy.

 The second surprise was that despite the fact that multi-brand executives say they are promoting company reputation as much as product reputation (81 percent and 80 percent, respectively), they fall short in communicating some key drivers of company reputation compared to their single-brand counterparts, particularly how employees are treated. There was a particularly large gap between single- and multi-brand companies when it comes to communicating about their workplace (73 percent vs. 52 percent, respectively). Companies that are proud of their records for employee satisfaction should not be reluctant to communicate these qualities and tout their awards or placement on ‘best of’ lists. These credentials help drive the overall reputation of a company, regardless of how many brands it markets, and possibly influence purchasing behavior.

Take a look at the summary for greater detail. When I was talking to PRWeek about the findings, they said they were surprised how little information was available on this topic. We agree. When we did the background research on the increasing indivisibility of the corporate and brand reputation today, we were floored by how little had been done and how companies had been relying on “this is how we’ve done it” thinking. We hope that we at Weber Shandwick are filling in some critical gaps on this dimension of corporate vs. brand reputation in a no-secrets-consumer-is-in-the-driver’s-seat Internet world.

Caught up on some reading this week. Lucky me.

One study comes from Echo Research and Reputation Dividend. They found that corporate reputations contribute to a total of $3.2 TRILLION to market cap in the S&P 500. Big number.

Reputation Institute released a new global survey report among corporate reputation officers (CROs), Navigating the Reputation Economy. The respondents are those senior officers who identify themselves as the senior-most person responsible for “setting their company’s corporate reputation, marketing, corporate communications/public affairs and business strategy.” One of their most important findings mirrors what we learned in our study on the company behind the brand. RI found that 80% of CROs say people’s willingness to recommend their company as a place to work or as an investment is driven by the perceptions of the company overall. Same for direct purchases — 38% say that purchase decisions are driven by the company behind the product or brand rather than what is actually for sale.

What is most particularly illuminating about the RI study is their depiction of where companies fall on the reputation management continumm. They describe a five-phase journey that companies go through from phase 1 (exploring reputation) to phase 5 (integrating reputation into  business planning and company strategy). Phases 2 (customization of measurement and management) and 3 (business planning integration) come before phase 4 (cross functional implementation and accountability).  Not surprisingly, only 13% of companies fall into the Advanced Phase among the 318 companies in the study.  Most companies fall into phases 2 and 3 (69%). Eighteen percent fall into the phase 1 exploration phase. My experience agrees with this assessment. Most companies are in the phase 2 and 3 phase. Few really fall into the most advanced stage.

The distinctions between Early Phase and Advanced Phase companies could not be clearer, according to RI’s results . Advance Phase companies are 2-3 times more likely to:
1.    Understand reputation across stakeholders and markets
2.    Understand specific business impact of reputation
3.    Have an internal council or steering committee to champion action
4.    Have senior executives accountable for corporate reputation KPIs
5.    Have reputation integrated into long-term enterprise vision, goals, and priorities

The favorite communications channels for reputation management are the company website, the annual report, stakeholder events and CSR reports. Advanced phase companies are more intense in their usage of nearly all the channels. However, as we have seen in elsewhere and in fact our own research, social media is the one channel where early phase and advanced phase companies are nearly the same. My sense is that this is because social media is still fairly new and experimental in the eyes of CROs and everyone is using it in the same way without being sure about what works and what does not work. All they know is that they have to do it!

The New York Times had a very interesting article yesterday for a variety of reasons. But one reason that hit the spot was about how consumers make decisions and how the author went about choosing the right baby formula for his infant. After he and his wife researched every possible formula on the market and found that they were all basically the same, he came to this conclusion:

“Despite knowing this, I still insist on paying twice as much for Enfamil, which its maker claims is “scientifically designed.” (Aren’t they all?) I splurge because Mead Johnson is a 107-year-old company that has been promoting a single baby-formula brand for more than 50 years. I figure that it’s less likely to squander its name by skirting the rules or engaging in shoddy manufacturing than a company with less to lose. This peace of mind costs me about $7 per day.”

This is emblematic of our research on how the company behind the brand matters more than ever. The author was reassured in his purchase of Enfamil because he learned that the company behind it, Mead Johnson, had been around long enough that they were not going to risk their century-old reputation by messing around with the manufacturing and production of  its baby formula.  The parent company made a significant difference in a confirming to the writer that this was the better buy, even at a premium. And not only did this infant get to taste Enfamil but the writer blasted his choice around the world. There you go for serendipity public relations.

After reading this gem which was fairly upfront in the article, I kept reading.  The Enfamil example led into the article’s main message which is that information overload is plaguing us all and making it increasingly hard to find what we are looking for unless we want to devote days to researching.  ”Too much information, it turns out, is a lot like no information.”  Therefore to deal with this information smog, people need guides orsherpas to guide their way through the data chaos. According to the author, “economists have a name for these cues that companies employ to convey their hidden strength: signaling.”

Reputation-building uses the strategy of signaling.  Good reputations serve as a shorthand to identify whom you want to buy from. A company that is a best place to work for or most sustainable or trains its leaders best helps to narrow the choices between products. Do I want to buy my infant formula from a company that treats its people right? You bet.  The thinking goes like this: if they treat their employees well,you can make the leap that they turn out safe products.  In our research on parent brands, we had an open-ended question on why the parent company mattered when buying a product brand. Over and over, consumers mentioned that knowing the parent brand helped them sort out which products to buy. For example, one consumer said: “The integrity of a company will ultimately show in its products.”

The article also made me think about anniversary celebrations. Many companies make a big deal about how long they have been in busines — 50, 100 or 200 years. It turns out that it is good to do so in order to remind consumers and other stakeholders that there’s alot of reputational equity behind those promises.

A Wall Street reputation study among marketing and communications executives at financial services firms was released this week.  When asked to rate themselves, only 34% gave themselves an above average grade while 9% gave themselves a grade of  ”perfect.”  Wonder who those 9% are? The remainder — 57% – gave themselves average or below.  The survey by Makovsky and Company had some intriguing results:

• 53% said that Occupy Wall Street impacted their business
• 71% said that Occupy Wall Street will last beyond the upcoming election
• 38% were surprised by Occupy Wall Street (time to be better prepared)
• 74% believe that increased regulation of the industry will help to improve financial service firms’ reputations and rebuild trust with customers
• 81% are worried about negative perceptions that exist about executive compensation
• somewhat more than 40% believe that social media has a positive impact on their company’s reputation; over half only perceive a neutral effect (fair enough)

So what’s a company in the financial sector to do? According to the findings, executives believe that management leadership, quality products and service, and a focus on reputation management will help restore reputation.

The killer finding is that 96% of executives agree that the industry brought the problems on themselves. You don’t get too much higher than 96%. That’s a outright acknowledgement.

Of course, today I saw an article saying that college students are still dying to get into the financial services industry. Many are waiting to hear news of summer internships and they are eager to make their way to the the cavernous alleys of Wall Street. So be it. However, I do think that this is the time for financial services firms to hunker down and repair their reputations for the long-term. I vote “yes.”

Each year Fortune publishes the 100 Best Companies to Work For in the U.S.   While the bulk of the company evaluation rests on a comprehensive employee survey, Fortune publishes a wealth of employer statistics about benefits, diversity and jobs. Weber Shandwick has been cataloguing this data since 2006, enabling us to look at how each factor changes over time.

Consistent with the improving job market in the U.S., the Fortune 100 Best Companies to Work For listing reflects some uptick in the areas of diversity and job statistics. While all of these Best Companies tend to offer a variety of perks to their employees, the number of these employers offering such perks have either plateaued or dwindled. Below are insights into some of these trends.

Jobs

The average Best Company enjoyed its highest job growth rate since 2008 (9%). 2010 and 2011 were bleak years, with growth of just 1% and 2%, respectively. Even more gratifying to report is that the number of companies with negative job growth is at its lowest level since 2009 (11%) when Fortune began providing job growth for all listed companies.  It had been as high as 45% in 2011. While there may be a self-selection factor in this, i.e., companies that experienced very high attrition simply didn’t enter into the list competition this year, it does mean that layoffs do not preclude a company from making it onto this important list. Perhaps, it is the way in which these companies manage their layoffs from a communications and operations perspective that result in their employees voting them onto the list. In fact, only 19% of these highly regarded companies have never had a layoff.

An interesting statistic that we assessed this year for the first time is the number of applicants per job opening. We went back to 2010 to see how this has changed, and change it certainly did! In 2012, the average number of applicants per job opening is 312 vs. 83 in 2010. Most likely this is a reflection of an improving job market (employees once cautious to leave stable jobs simply weren’t applying for new jobs), or it may show the effects of the good reputations of these particular companies. (And of course it may reflect the number of people looking for jobs in general but we’d expect the figures in 2010 and 2011 to be more equal.)

Diversity

While the average percent of women and of minorities in Best Companies do not show any gains since 2006, we see that 100% of Best Companies now have gay-friendly policies and the trend for gay-friendly benefits continues to edge up from 70% in 2008 to 89% in 2012.

Benefits

The most pronounced change over time in the offerings Best Companies extend to employees has been job sharing. In 2007, 71% of Best Companies offered job sharing and in 2012 it is down to 53%. Also a noticeable change since last year is the number of Best Companies that subsidize employees’ gym memberships, down as well (71% vs. 61%). All other benefits are fairly flat from last year.  Perhaps this is an outcome of a prolonged a down economy where employees’ satisfaction with having a job drives their satisfaction with their employer, regardless of job sharing or gym benefits.

Engagement

We wanted to see how many Best Companies represented their organization on the Fortune site with a picture of people (presumably their employees, but we can’t say for sure). The majority did – 64%. However, it begs the question as to why the rest would choose not to showcase their employees when the ranking is so employee-focused and is such a great recruiting tool. Most other pictures were of the corporate headquarters building.

*Too many companies on list with “NA” to calculate