According to a survey by Reputation Institute, in 2010 the ten most trusted large companies in the U.S. were Johnson & Johnson, Kraft Foods, Kellogg, the Walt Disney Company, PepsiCo, Sara Lee, Google, Microsoft, UPS, and Dean Foods; other notables near the top included Apple, Caterpillar, HJ Heinz, and 3M. (Unsurprisingly, financial institutions dominated the bottom of the list, with AIG coming in last at 150.)
What accounts for the success of the top firms? Forbes reporter Laurie Burkitt notes that "The secret to Johnson & Johnson’s success rings true for all of this year’s reputable companies: Each has direct connections to their consumers and their families." Food producers did well as more Americans ate at home, thereby increasing brand recognition in the process. Philanthropy also boosted reputations: the Bill and Melinda Gates Foundation, for example, helped lift the reputation of Microsoft. Such attentiveness to status matters: Anthony Johndrow, Reputation Institute’s president, states that reputation translates into customer recommendations, "and you can bet you’ll improve your bottom line."
Another survey, focused on US "thought leaders," put Apple at the top, followed by Google, Southwest Airlines, Amazon, Facebook, Microsoft, Intel, RIM, Coca-Cola, and Whole Foods. Trust, authority, innovation, admiration, and the competitive advantage of their products all helped to define these companies as best.
What should you pay attention to? Different advisers recommend different metrics, but they generally coalesce around a few main themes.
Yes, this should be obvious by now, but companies at the top neither take this for granted nor rest on their laurels. They integrate this concern into the structure of their businesses rather than treat it as a public relations adjunct. Reputation management is an activity, not a slogan. This follows from the first point: You must actively monitor media about your company and be in a position to adjust your message as needed.
I almost wrote "control the narrative," but that isn’t always possible. Instead, recognize that if you don’t tell the story of your company, someone else will. This doesn’t mean all ad campaigns have to include the history of your company or that spokespeople have to tell the same anecdote about the founder or CEO over and over, but that you have a sense of the general narrative and purpose of your organization, and are able to call on that story to guide your actions.
Sometimes the actions themselves can tell the story, as with Amazon. The online retailer invests little in offline marketing, instead concentrating its investments in technology, distribution, and good deals. One marketing specialist notes that “It’s not about splaying their logo everywhere. They are all about ease of use.” Similarly Zappos built its business on inventory, delivery, and service: customers know that if the shoe doesn’t fit, they can ship it back to the company, free of charge. Unsurprisingly, perhaps, Amazon bought Zappos in July 2009.
Those companies which succeed are those which know what business they’re in.
Ritz-Carlton knows they’re in the service industry, and Maclaren in the baby-products biz, so each must concentrate on that which sets their brand apart. Bill Taylor, writing about the “amazing” customer service of Zappos in the Harvard Business Review, notes that “it’s the emotional connection that seals the deal.” If you sell widgets, then those widgets have to be reliable and appropriate to your target market; so, too, with the services you provide. Fit matters.
Aloof no longer cuts it in the wide-open social-media age.
Employees have always kibitzed with one another about the job, but now they can go online and let the world know their thoughts. Consumers, too, can click around for information on a product or corporation; Randall Beard, formerly of UBS, notes that “it's really easy for consumers to check and verify a company's behavior to find out if a company's actions match its words.”
Trust is particularly important to companies which operate exclusively or largely online. Would you shell out $100 for a pair of shoes or a sweater you didn’t know would fit you if you didn’t know you could easily return it? And wouldn’t you want someone knowledgeable to guide you through the fitting process? Land’s End, LL Bean, and Zappos each have generous return policies and a surfeit of customer representatives. The LL Bean Customer Service web page leads with a quote from Leon Leonwood Bean: “A customer is not an interruption of our work...he is the purpose of it. We are not doing a favor by serving him...he is doing us a favor by giving us the opportunity to do so.”
Most errors are small -- a cold meal, the wrong size shirt, a broken shelf -- and don’t require the intervention of the CEO. Those employees who are in a position to fix the problem should thus be adequately trained and empowered to do so.
The Ritz-Carlton allots every employee $2,000 to spend satisfying each customer with a complaint. Human resource director John Collins stated “You’ll never get in trouble for taking the extra step.”
Another no-brainer -- or so you’d think.
Does your organization have a way to identify problems over time, that is, to track whether the error is isolated or part of a larger and more persistent problem? Do employees have a way to bring this information to management’s attention, and are they rewarded for doing so? Recognize emergent concerns and respond to them. Are your customers concerned about the environment? Do they pay attention to working conditions at your overseas facilities? Have any of your business partners or stakeholders been targeted for protests or boycotts?
Stakeholders don’t want to hear about your hard day or that you want your life back -- they have their own lives to worry about.
Workers want to know about production expectations and a rewarding work environment. Shareholders want to know their investment is managed by smart and forward-thinking executives. Consumers care about value in the end product, period. It’s never good to get the reputation as a whiner. No excuses.
There’s a common theme running through all of this: Pay attention. Really, it starts and ends with the attention you pay to every aspect of your business, from the people on the front lines to the person in the corner office and everyone and everywhere in between. You have the opportunity every day to either get it right or get it wrong. Pay attention to getting it right.
(Excerpted from 360 Degrees of Influence (McGraw-Hill 2011)
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