Tag: GE

Reputation Management in the Digital Age: New Critical Success Factors

Editor’s note: This is the second of a two-part SoundInsights installment examining the best practices for managing corporate and non-profit brands based on the new realities of the digital age.

The decline of traditional communications channels, coupled with the rise of social media, have upended many of the longstanding tenets of reputation management for corporate and non-profit brands alike. Today, organizations engage in two-way communications that are often initiated from the bottom-up—from one or more stakeholder groups—as opposed from the top-down—from the organization itself.

Below are several critical success factors that are the basis of a new playbook for the digital age.

Develop a value proposition that balances business rigor with social relevance—and vice versa.

Traditionally, a corporate or non-profit brand was rooted in benefits that were largely exclusive to the end users of their products or services. When knitted together, these benefits were commonly articulated as a value proposition or mission statement designed to resonate with customers, beneficiaries, investors and donors.

That has all changed: Corporations are now expected to be more mission-driven in their business pursuits, whereas non-profits are expected to be more business-like in making good on their missions.

Corporations are increasingly expected to contribute to society’s greater good, not simply their bottom lines, as we know. B2C and B2B companies ranging from Unilever and Walmart to GE and IBM long ago committed to addressing key societal challenges, often selling more products and services at better margins in the process.

Indeed, the enunciation of a profit imperative often enhances the success of a company’s CSR efforts. When then-GE Chairman Jeff Immelt proclaimed “green is green” during the 2005 launch of ecomagination, he did so because the company—renowned for its Six Sigma discipline—would not have been viewed as authentic if it had positioned the initiative as giving back to society. Instead, Immelt explained that the environment represented a business priority for the company, while reinforcing GE’s Edisonian heritage of innovating solutions to pressing societal needs.

For non-profit organizations, whose social relevance is often explicitly captured in their mission statements, there is an inverse opportunity: Clearly articulate a business-like management of your operations. Some key findings of Edelman’s 2017 Trust Barometer, along with research we’ve conducted on behalf of various non-profits, reveal that trust in NGOs has declined in recent years largely because they are not widely viewed as problem solvers. While admittedly oversimplified, the prevailing attitude is that non-profits would be more trusted if they did a better job of measuring the returns on their investments, either socially or financially.

Of course, NGOs have long been evaluated by the percentage of donations that are directed to those they serve, but stakeholders expect a disciplined, interdependent approach to strategic and financial planning. How long will it take an environmental group to return local rivers and streams to health, for example, and what resources are required to achieve this outcome?

Stakeholders further expect non-profit organizations to produce tangible, even quantifiable, results. When pivoting away from its longstanding operating model as a fundraising organization, The United Way of America in 2008 announced Goals for the Common Good—performance metrics gauging the extent to which Americans are healthier, better educated and more financially secure. Progress against each of these metrics is not sufficient; the organization is holding itself accountable to fixed quantitative goals.

Know which social issues to commit to—and which to avoid—and how to speak to them.

Corporations are expected to substantively address social issues, but doing so in the age of social media—and in a society that is often sharply divided—is frequently challenging.

When Apple and J.P. Morgan Chase made contributions to the Southern Poverty Law Center following violent protests in Charlottesville, Virginia earlier this year, they were disparaged for supporting what some characterized as a partisan, unsound charity. Even Starbucks, whose commitments to the greater good are nothing less than groundbreaking, was universally lambasted for its Race Together conversation starter on race relations.

Fair or not, the criticism leveled against these and other companies reveals the fundamental need for a company to first understand the expectations of key stakeholders before shaping, let along communicating, its CSR efforts: Where and how can it make the most valuable contributions to society? And how might those contributions be reasonably viewed from an opposing perspective? Efforts to address even the most deserving of causes, if widely perceived as inauthentic or ill conceived, can undermine a company’s communications and business objectives.

While market research is the only precise means of answering such questions, our experience tells us that stakeholders commonly emphasize the extent to which there is an intuitive relationship between their perceptions of a company and a given social issue. If a company is viewed as being capable of making particular headway with a social issue—largely as a result of its distinctive competencies, less so because of its financial largess—stakeholders will give it high marks.

Equally important is whether a social issue is a common priority with a company’s various stakeholders. Also, how might a company’s support of a social issue imply a public policy position? Tabulating research findings by party affiliation, or the lack thereof, has long been a best practice in market research, but it is an outright imperative in today’s hyper-partisan climate.

Recognize your employees not simply as brand advocates, but also as sources of media.

Storytelling is essential to the vitality of today’s corporate and non-profit brands—and an organization’s employees are unassailably its best storytellers. Their organic, bottom-up perspective on an organization is inherently more authentic, after all. While some organizations struggle with providing employees with the latitude to speak publicly on their behalf, it is the uniqueness and incongruence of their perspectives that them universally compelling.

Compounding the value of employees as storytellers is their connectivity with other stakeholders through social media, along with the unequaled credibility of peer-to-peer communications. Putting real faces on a company is not a new communications strategy, but the practice was often a choreographed marketing effort. Of late, increasing numbers of companies, including some of the world’s largest, are creating employee advocacy programs that emphasize social media, without imposing strict rules. AT&T’s Social Circle, for example, allows employees to speak in their own voices—and now boasts more than several thousand members.