Worth taking a look at NYC mayor-elect Bill De Blasio’s transition web site. It is very transparent and user-friendly. You can apply for jobs, review who the transition team is, send an idea. volunteer, or read blog postings. It is a great idea that matches with what he promised in the run off. Nice fit. Transitions are important times to set the tone and style of the incoming individual or executive. The large photo on the home page with De Blasio reaching out to constitutents sends the right message that he aims to be a man of the people (I think he said “we all rise together”). How it turns out will be another story but for a start, it’s a good one. CEOs should consider this transition site as a good way to mark their first 100 days internally.
I attended the Council of PR Firms Critical Issues Forum a week or so again. I always enjoy attending because I learn something that sticks with me. The topic was all about Content Frenzy which certainly resonated with the attendees. The panels were stimulating and overall, an A+ event for those of us in this industry who are watching what is content change before our eyes. Of course, I have to tie everything back to my main interest in reputation, so here goes:
1. Media pundit Jeff Jarvis said that “messages are dead.” He said that we should be in the relationship business and worry less about messaging. Makes sense to me if you are building reputation. Communicating that want to be perceived as the most innovative company, the most admired company, the best place to work, the most global, etc. does not stick for long in people’s minds as much as creating the feeling that a company cares about you as a customer, wants to listen to what you have to say and works hard to retain your business.
2. News Corps’ Strategy VP Raju Narisetti said that companies are not competing for audiences but for our time. That’s the honest truth. Companies have to recognize that there are so many hours in the day and everyone is overextended and bombarded with messages. Good storytelling is the answer and knowing how to do it well is an art as well as a science. Six second Vine videos might just do the trick. He also said that native advertising was a faustian pact that could cause serious credibility problems (ouch!) and damage reputation (ouch!).
3. Harvard Business Review’s editor-in-chief Adi Ignatius said something that certainly perked up my ears. He said that everyone today is a thought leader. He is right. Everyone provides content. I consider myself a thought leader and it did not feel good to hear that my competitors are everywhere. I have been learning too that everyone is a reputation management expert. I might have to figure out something else to do. Reputation-wise, companies and CEOs with a thought or two of their own are competing with everyone else’s content storms. Everyone is overwhelmed with a glut of content, so said Amy Webb of webbmedia. She is someone worth following.
4. Small data is more relevant than big data. I dont know who said it but it is profound. I agree. We are so focused on the very big data, that we are missing the more relevant, localized, individualistic insights that can break through our universal content overload. When it comes to reputation, maybe we should be focusing on the small conversations and not the “most popular” ones. We might learn alot more by following one person over time than following an entire army of tweets and posts. Maybe, also, it is the smaller and more incremental reputation enhancement steps that matter than the large, broad big efforts that companies tend to embark on and hammer us with. I am not sure but I know it is true when it comes to reputation recovery.
Tomorrow is Monday…have a good week!
This morning I saw this infographic on business2business about YELP . The infographic lists the five reasons why YELP should not be trusted and is instead a monster. YELP is a user review and recommendation service and I’ve used it many times. I thought to myself, well this is pretty defamatory. The site says “You might be asking, what really makes Yelp so bad? If seeing that up to 25% of the reviews on their site are fake and that sometimes they don’t even publish real reviews doesn’t convince you, then we have another five reasons that may help you believe that Yelp is a monster!” I often read infographics because they are fun and visually compelling. But I rarely see an infographic that is such a reputation-buster and lists why a company deserves to be mistrusted. After being taken aback by the five reasons not to trust YELP, I carefully read the reasons given and they were not so pretty. I am sure there is some reality behind the accusations but it was surprising to see an entire infographic that was so anti-YELP and reputation-damaging. Not so fun! Wonder what YELP has to say.
It has been a crazy few weeks — traveling to Berlin, San Francisco and Istanbul. But I am back in the USA. So here are a few observations about things I’ve read and learned that I wanted to share:
1. Deloitte Touche Tohmatsu just issued a new report on reputation risk. Reputation risk was the top strategic risk among 300 global C-suite executives surveyed. The survey found 40% of respondents listed reputation as their top risk concern today, with their business model second at 32% and economic trends/competition third at 27%. In 2010, reputation risk was at 26% so we can see that it has moved to the very top of the C-suite agenda. Henry Ristuccia, global leader of governance, risk and compliance at Deloitte had this to say (love this quote): “Reputation risk is going to always be the meta of all risks…how you manage the underlying factors that could affect the organization’s reputation or brand…how resilient are the people, the culture?” The meta of all risks!
2. In Istanbul, I spoke about Reputation Warfare, the theme of my Harvard Business Review article. The occasion was the 2nd International Reputation Management Conference at Kadir Has University. It was very impressive because there are not many reputation management conferences in this world (Reputation Institute holds one annually) and here I was in Istanbul. Very forward-looking of the university. The summer protests in Turkey at Gezi Park was an interesting backdrop to my discussion on using social media as an opportunity to defend one’s reputation in addition to the risk. Additionally, there was discussion about how the protests had affected the reputation of the country. Tourism took a hit in July but from the looks of it, it was pretty healthy this week. I am going to keep a watch out for how Turkey repairs its reputation and what types of reputation recovery strategies are employed. All very interesting and doable. I also experienced some of the Turkish hospitality that they are so well-known for.
3. Just this past week, I read two articles on how Goldman Sachs and JPMorgan are repairing their reputations. All in one week. Clearly this is a topic that has grown exponentially and particularly in the financial sector. The Economist article on Goldman Sachs was fascinating because it described the scenario setting that is being used to train vice presidents to better understand their responsibilities to the firm when faced with ambiguous and complex challenges to doing business today. The case study is preceded by a film that is described this way: “…an emotive documentary on the history of Goldman Sachs, filled with interviews of luminaries and former executives, each hammering home the virtues that supposedly make the firm distinctive—teamwork, personal accountability and the legendary exhortation by Gus Levy, a former leader of the firm, to be ‘long-term greedy’, by which he meant it should forgo short-term profits if they came at the expense of client relationships.” I mentioned in a previous post how Goldman Sachs is super-engaging in training which included their CEO from the start. In addition, incentives have been revampedd and tied more to collaboration and teamwork. The WSJ article on JPMorgan’s CEO Jamie Dimon focuses on how he is converying “business as usual” as he faces an imminent federal lawsuit, another revealing reputation recovery strategy. He has been touring midsize cities such as Cleveland, Oklahoma City and St. Louis meeting with local businesses and community leaders that are supported by JPMorgan’s philantrophy. According to the article, Dimon’s message are fine-tuned, upbeat and focused on the customer.
Years ago I met Michael Fertik, CEO of reputation.com. He emailed me as CEO of reputationdefender.com as he was building his business and probably figured I was worth meeting. I was delighted to meet this young Internet entrepreneur because we shared the same passion for reputation management and particularly for the evolving state of online reputation management. Now Michael is a reputation rock star and I enjoy watching how his start up has grown into a full-fledged service for individuals and businesses. Additionally, Michael’s stance on privacy issues and the need for privacy vaults where we store our own personal data is critically important for our futures. He’s worth keeping on your radar.
All of this is by way of saying that I was interviewed for reputation.com and I thought it was worth sharing with you here.
I was recently thinking about this interview because of my comments on the amount of attention being paid to the customer and how I sometimes think that the importance of the customer is being neglected by the focus on all the new bells and whistles and whizbang of the Internet. The channels are indeed exciting but the ultimate aim is to attract a customer and build a unsurpassable customer experience. This was highlighted to me in a recent Forrester study on the rise of the Chief Customer Officer. We actually need these senior officers more than ever to hone in on every company’s center of gravity — the customer. These CCOs need to create end-to-end accountability for customer experiences, design customer experiences that transform how a company operates and delivers value to its customers and shift the culture to a customer-centric one. Reputation loss will be less severe if the customer is at the heart of the organization and at the CEO’s side.
I have been thinking lately about how the world of reputation has been changing or not. One of my constant thoughts is about how companies now seem in greater control of their own reputation narratives. Whereas we used to be so dependent on the media to report a company’s coming and goings, companies now seem to be in the driver’s seat of storytelling. This was confirmed to me the other day when I came across it from a different perspective. In an interview with former Wall Street Journal Deputy Editor and Executive Editor Alan Murray and now president of the Pew Research Center (an organization I dearly value), he said: “In the 2012 race for the White House, journalists played a decreasing role in what voters heard about the presidential candidates. Only about a quarter of the statements in the media about the character and record of Barack Obama and Mitt Romney came directly from journalists, while about half come from political partisans. In the 2000 election, half the statements came from journalists and only about one-third from partisans.” Of course, 2000 was before the Internet took off, Facebook appeared and Twitter surfaced.
Yet, the same can be said about companies’ character and record today. I bet that about half of the information we hear about companies’ comings and goings comes from stories we find online, stories our friends and family share with us and search engines that filter information by popularity or some sort of algorithm I cannot explain. And I’d bet that only one-quarter or less of a company’s story or reputation-telling comes from in-depth reporting from the media. This newfound advantage gives companies a greater opportunity than ever before to build or re-build their reputations. And because CEOs can use their websites, video or social media without having to win the media’s seal of approval, leaders have a home court advantage that is unassailable.
In some sense you could say that this is the Golden Age of Corporate Storytelling. However, the question I keep asking myself is how many stories does it take to build a positive reputation and bury the negative? What does it take for a company story to break through the clutter of facts, rumors, innuendos and misinformation online and offline? How do you hold stakeholders’ attention when they are so increasingly distracted? If everything matters today, what one thing should a company do well to build its reputation? Where do we start and where do we end?
CFOs are not solely numbers-crazed, according to a survey by American Institute of CPAs (AICPA) and Chartered Institute of Management Accountants (CIMA). The survey among 1,300 CFOs and other finance executives in 61 countries found that corporate reputation topped the list of areas they are seeing their organizations place greater focus on. In fact, 76% put corporate reputation first. The reasons for this laser like focus on reputation, according to these financial experts, are greater demands for transparency by the marketplace, watching other companies experience reputational failure and the rise of social media. A fairly large 65% of these financially-minded executives also report that the financial implications of reputational risk are seriously considered by their organizations. Far fewer (20%) say that they use social media feedback enough to anticipate and monitor reputational risk. Since there are so many daily examples of companies losing reputational equity, it seems that CFOs are not monitoring enough so that they can be prepared and nimble should it happen to them.
To be a CFO today, an understanding of how reputation impacts the bottom line is an imperative. The loss of reputation can surely impact financial performance, customer loyalty and recruiting. The results from this study make it very clear that CFOs are becoming increasinly cognizant of the perils of reputation loss on their company’s ability to compete and grow. They just need to speed up their social media oversight.
CEOs and other executives coming onboard face many challenges. Egon Zehnder recently surveyed international executives about the transition process and one of the findings is that 57% said that it took six months or more to successfully transition to a new position and make full impact. 43% said it took 3 months or more which is about the first 100 days. Realistically, it takes about six months at least. The results are probably different depending on whether the executives comes from inside the organization or outside.
And no surprise here, a minority of executives (30%) had a good transition integration in their new positions. When they did get onboarding, over 80% said it was beneficial. They’d like help with navigating the internal politics and networks (56%) and obtaining insights on the new team they are taking over (41%). It is always the softer skills that need the most support when executives transition to new positions.
How executives make the transition impacts their reputation. Those first impressions in the first 100 days or so are extremely sticky! Therefore, you might want to use social media internally to reach as many people as possible, depending on the culture you find yourself in. But reputations are created when the cement is wet so be cautious and move smartly.
Graeme Trayner sent me an article he co-authored on how businesses can take lessons from the political campaign trail. He’s right in making the point that political campaign strategy has found its way into corporate business today. In many meetings today, I hear the words “pivot points,” “news cycles,” “opposition research,” and “opinion research.” Incorporation of these political-like strategies and tactics are increasingly important for companies to learn as they try to maintain their reputational footing while being broadsided by slings and arrows from pundits, opponents and errant employees. Trayner points out how the new environment requires company leaders to go beyond winning the news cycle and shift towards a more participatory style, greater stakeholder empowerment, concentration on the right tone, and an outside-in approach to communications. He highlights the need today to focus on winning the “big arguments” not all the arguments all the time.
Graeme and his co-author, Julie Andreeff Jensen, make an important point that I wanted to highlight here because it describes how companies must adapt to an empowered base of stakeholders to maintain their reputationanl balance:
“Brands are now very much seen as public property, with assertive consumers feeling a strong sense of sovereignty over what they can and can’t do.”
Like never before, the term “stakeholders” is in sharp relief. Stakeholders have a much clearer stake in the brands and reputations of the companies they support and are now the first to object to corporate misbehavior, unfairness or lack of transparency. And they can assert themselves whenever they want now, regardless of news cycle. Reputations are increasingly being torpedoed because consumers want their say in how companies behave and what they do. When that wish is not granted or they are not listened to, companies will regret it and pay the price. The political campaign trail definitely holds lessons for those of us safeguarding reputations today.
I had heard of a new CEO listening tour but to me, this was a first. JCPenny is running a social media Apology tour. We’ve all heard CEOs apologize for one thing or another and we’ve all worked in companies where a new CEO visits different employee facilities to meet and greet and hear what is on people’s minds. But JCPenny now has a new campaign on TV that apologizes for letting customers down and thanks them for coming back. If you recall, the former CEO Ron Johnson from Apple fame was booted out when his plan failed, possibly because of the elimination of coupons which drove customers into the store. The former CEO, Myron Ullman, was asked to return and now they are in recovery mode. The two ads say:
“It’s no secret. Recently, J.C. Penney changed. Some changes you liked, and some you didn’t. But what matters with mistakes is what we learn. We learned a very simple thing: to listen to you. To hear what you need to make your life more beautiful. Come back to J.C. Penney. We heard you. Now we’d love to see you.”
“At J.C. Penney, we never stop being amazed by you. How you work so hard without looking like you do. How you make every dollar stretch so far and keep your family so close. So we brought back the things you like about J.C. Penney, gave you new things to explore and now, we’re happy to say, you’ve come back to us. We’re speechless, except for two little words. Thank you.”
But back to social media….using the hashtag #jcplistens, JCPenny is in response overdrive from what I saw on Twitter today. They are in constant contact with its Twitter-ites. Every customer or tweet seems to get a personal and speedy response asking to help out, mentioning they will share the feedback with the team if something was amiss and thanking customers for comments. As pointed out on Business Insider, they even told people when they were retiring for the evening. On its Facebook page, JCPenny is polling fans about their favorite brands that they want back after having been cut by the former CEO. And it looks like they are bringing back St. John’s Bay, a favorite. So they are listening hard.
You’ve got to hand to them. They’re trying. And social apology tours are a smart redemption move.