Bolstering Corporate Reputation

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4 main pillars as the ones response for controlling a company as well as it Reputation;the Company Structure, the Top Management Team, Corporate Social Responsibility and CrisisManagement team.

Transcript of Bolstering Corporate Reputation

  • CORPORATE REPUTATION MANAGEMENT

    Bolstering Reputation through Overall Management

    NUNO COELHO MARTINS

    March 2013

  • Introduction

    Corporate Reputation Management (CorRM) is giving its first steps towards actually and

    convincingly becoming a new insurmountable part of management philosophies. Its input should be

    hold in high regard whenever taking decisions foreseen to have a strategic impact.

    With the present document I will be defending the importance of Corporate Reputation

    Management in the management of companies and its most important areas of action.

    I present the Company Structure, the Top Management Team (TMT), Marketing and Crisis

    Management teams as being the four areas which are ultimately responsible for the Corporate

    Reputation through the strategies they choose to follow. I defend that nowadays good corporate

    communication alone cannot create good reputation anymore. News travel fast and when a negative

    event occurs fast reaction from Crisis Management Team behalf is required. Such reaction will

    depend on how the company is structured and of who is part of the TMT. These two areas are

    directly responsible for the creation of a Crisis Management Team.

    On the end, this project defends that for companies to maximize their Corporate Reputation value,

    and inherent benefits, they should embrace new managerial philosophies, such as: Agile & Scrum

    Management (generally used for product development), Lean methodologies (for operational

    management) and bring them together with the use of Crisis Management and Marketing with

    Meaning ( MwM )concepts. All together, these are intended to cast influence across the structure, a

    structure much leaner and flexible; with strong focus on strengthening its identity as much as its

    image.

    Keywords: corporate reputation, identity, image, Marketing with Meaning, MwM, structure, TMT,

    Top Management Team

  • Abbreviations

    CorRM Corporate Reputation Management CR Corporate Reputation CSR - Corporate Social Responsibility

    HNWI High Net Worth Individuals LOI Letter of Intent MENA Middle East and North Africa MwM Marketing with Meaning

    PR Public Relations SAV Savanza Inc SEF Savanza Educational Foundation TMT Top Management Team TP Technology Pioneers WEF World Economic Forum

    Figures & Graphs list

    Figures and graphs can be found as part of ANNEX a) under the denomination Figure 1, Figure

    2 and Figure 3.

    FIGURE 1 - Graph taken from Corporate Reputation Management Master class group work

    presentation. Case: Research in Motion. Complete work presented as ANNEX /b)

    FIGURE 2 The corporate Personality Scale (Davies et al., 2001)

    FIGURE 3 The Reputation Quotient (Fombrum et al., 2000)

    FIGURE 4 Stakeholders Theory ( Donaldson & Preston)

  • Theoretical framework

    One wonders where problems germinate from when they do so. When in a company we are

    expected to avoid them and if they sprout we are expected to minimize their damages. Minimizing

    damages is not the only thing to be done as actions must be taken in order for the same problem not

    to arise again in the future. Why is this? All problems affect the companys image and when the image is hurt, the business itself will bleed. The reputation of a company is one of its own most

    important assets and as such proper Reputation Building and Management is critical.

    Corporate Reputation Management (CorRM) is giving steady steps towards convincingly becoming

    an integrant part in the decision making process, as its important input shades over and across the

    whole structure of the organizations.

    I am proposing that CorRM becomes an integral and critical part of any management philosophy

    and operational procedures used by organizations.

    I present 4 main pillars as the building blocks for running a company maximizing its Reputation

    while pursuing their financial objectives; the Company Structure, the Top Management Team

    (TMT), Crisis Management team and Marketing with Meaning (MwM) philosophy.

    Nowadays, good communication alone cannot create a good reputation anymore. News travel fast

    and when something disruptive happens the reaction of the Crisis Management Team must be fast.

    Such reaction will depend both on how the company is structured and on who is part of the TMT.

    These two areas are directly responsible for the existence of the Crisis Management Team.

    For companies to maximize the value of their Corporate Reputation they should embrace new

    operational management philosophies as: Agile & Scrum Management (generally used for product

    development), Lean methodologies (for operational management) and bring them together with the

    Crisis Management concept and MwM. Bringing these together we will be able to easily adapt and

    implement new philosophies such as the latter one. All together, these cross-functional teams will

    drive an organizations reputation to grow on a sustainable way and to have its image strengthened and revenue increased.

    Corporate Reputation Management shall take on tasks such as; studying, analysing and acting upon

    a number of cross-functional activities which are part of the companys environment. It focuses both on the Costumer perspective (Image) as well as the Employees vision (Identity). Having a clear and bright image of both fields Image & Identity - is very important for a company strategy to be set and for Reputation to be strongly built.

    On the Costumer perspective the main goal is centred around Increasing Satisfaction, Loyalty and thus way Revenue, not forgetting about gaining leveraged positions with further external stakeholders as being shareholders/investors and suppliers. On the other end, the concerns with

    Employees fall within the inner need to keep them on acceptable levels of Satisfaction with the aim

    of increasing the Retention rate. A good company Identity will as well help in attracting the best and

    brightest (Recruitment).

    Corporate Reputation shall always be taken into account on any important strategic decision and for

    such it will have to, on a wider or skewer extent, analyse and provide input or guidelines for several

    different areas/departments as are: Governance, Corporate Social Responsibility (CSR), Marketing,

    Sales and Quality Control.

    CorRM should be an important part in the running of companies as is already in the running of

    ones personal life. How a crisis period can affect a company and how it should be dealt with, how the TMT psychological traits affect a company and Lean management is driving companies towards

    transparency. Such transparent management methods can only affect positively a companys image and identity and therefore, the Corporate Reputation.

    Experience shows us that most companies do not have a Corporate Reputation Management

    department, or even a clearly identified responsible person for the area on the company structure.

    Some companies have executives whose functions revolve around reputation management, though

    not usually understood as such as per their duties agreement. The World Economic Forums (WEF) ex-COO was one of those cases that, besides his operational management obligations, was always

  • trying to improve some process or communication guideline in order for WEFs reputation to be constantly strengthened.

    So it should be safe to say that organizations with professional management levels are doing this by

    always morphing, allowing the company structure to constantly adapt to the ever changing market

    conditions. Such assumption would, as a matter of fact, be wrong and the study "Does Management

    Really Work?" - HBR, November 2012, Nicolas Bloom, Raffaela Sadum & John van Reenen)

    backs it up. 8000 companies were analysed in 20 countries throughout 8 years to conclude that most

    do not set "Targets", "Incentives" nor "Monitoring" procedures. These 3 procedures are an integral

    part of the philosophies that I present as being the way for an organization to be managed through a

    path that will lead to an optimization of the value of its own Reputation. Reputation is built from the

    inner sphere of the company towards its stakeholders. Companies that were assessed by the HBR

    team into using simple Lean methodologies had a 50% reduction in miss-development of product,

    productivity increases of up to 20% and 10% increase in output.

    Bearing such data on mind I present SCRUM management as a process which would minimize

    bad management as the product/service/project development process would constantly find flaws (from product characteristics to market characteristics), if existing, and correct them. Empirical

    proofing will be generated by this process in order to constantly adapt work and operations of

    teams.

    SCRUM management is a form of organizing work by breaking it down in tasks, with closed loop

    cycles with daily reporting in order to better control the achievements and obstacles. It all starts

    with an ideaa request, in product development: feature request. It can be presented by a team member, costumer or company executive. This request is submitted under a form in which it clearly

    states: who will benefit from the feature, the feature and the benefit (eg: As a ROLE I want FEATURE so that BENEFIT). If accepted it becomes known as a user story (USt) and the collection of all USt is known a product Backlog.

    The pe