Image as part of corporate strategy: Building reputation and results for any business

June 12, 2009

Copyright © 2009 PRSA. All rights reserved.

By Tom Gable, APR, Fellow PRSA

 

The following article appears in the spring 2009 issue of The Strategis

 

The major national media regularly rank the most admired corporations in America, listing the core values that helped them gain fame. Is this effort just the business equivalent of selecting the most popular students in the high school yearbook? Or should companies and organizations concern themselves with image and reputation?

 

Definitely the latter, and it has become even more important in turbulent economic times. Over almost two decades, studies have shown that intangible assets like reputation may provide companies with a more enduring source of competitive advantage than their patents and technologies. Reputation speeds growth and protects against crisis or criticism should fortunes or the economy reverse direction. John Quelch,  the Lincoln Filene Professor of Business Administration at Harvard Business School, confirmed  the importance of promoting during a recession or downturn in the Harvard Business Review: “It is well documented that brands that increase (marketing) during a recession, when competitors are cutting back, can improve market share and return on investment at lower cost than during good economic times.”

 

But it can’t be hype. Companies, institutions and organizations can’t simply claim to be leaders or the top ranked in quality, technology or community commitment. Achieving a desired position and enduring reputation requires investing in your image strategically over time and providing ongoing proof of principle.

 

Charles Fombrun, in his book “Reputation,” notes that companies develop winning reputations by creating and projecting a set of skills that their constituents recognize as unique. Studies by Fombrun and other authors, such as Leslie Gaines-Ross (“CEO Capital”) and Ronald J. Alsop (“The 18 Immutable Laws of Corporate Reputation”) show that the most-respected companies build names for themselves by developing practices that integrate economic and social considerations into their competitive strategies. They not only do things right, but to quote Fombrun, they do the right things.

 

The result is that a strong image and good reputation have a positive impact on growth in profit margin, employee morale, community goodwill, investor support, relationships with vendors and suppliers, and overall organizational pride. Publicly traded companies enjoy a higher-price earnings multiple than their competitors and are also buttressed on the downside based on trust and respect they’ve developed over time, provided that they stay true to their core values and culture.

 

So how do you get there? It’s not a one-shot program. Based on extensive, ongoing research and experience working for a wide range of clients for more than three decades in good, marginal and bad times, eight key areas provide a foundation that any company can use to incorporate image as part of its corporate strategy.

 

1. Analyze the competition

How do you want to be known over the next two to five years? What do you stand for? Do you have competitive advantages? Can you clearly differentiate yourself from the competition?

 

Create a competitive matrix. List your firm’s name and key competitors’ names across the top of consecutive columns in an Excel spreadsheet or a table in a Word document. Then, in separate boxes below the names, list each organization’s tag line, descriptive clauses (usually found in the first paragraph of a news release), the boilerplate language of the news release (the “about” paragraph in a release) and any other key words or positioning statements you feel should be included. This gives anyone the ability to scan across a row and see the array of exuberant copy, hyperbole and largely empty claims.

 

Does everyone sound alike? Do they claim leadership? Do they provide proof? Can any of the claims be substantiated?  What’s there? More important, what’s not there? Can you truly differentiate?

 

2. Establish core values and positioning

Having finished the research, you’ll now want to brainstorm internally about what the company aims to stand for over time — its desired positioning. Then determine the three or four core values that are its differentiating elements (e.g., culture of the highest integrity, quality construction, technological innovation and shareholder return, hiring the best and brightest, giving back to the community, investing in innovation or solving unmet medical needs).

 

Can your company truly be identified as a leader? If not, think about your proprietary processes or other differentiators. In his landmark book “Competitive Advantage,” Michael Porter, the Bishop William Lawrence University Professor based at Harvard Business School, talks about differentiating along the entire chain of value that a company or organization provides to its many constituents. For a traditional manufacturing company, the chain builds value from five primary links or activities: inbound logistics, marketing and sales, operations, outbound logistics and customer service.

 

For a PR firm, the primary links would be outside services and supplies, operations, the agency delivery system, new business development and client service. Those primary activities are also facilitated and energized by four basic support activities, or your communications: organization and infrastructure, human resources management, technology development and procurement (outside dealers, freelancers, strategic partners). If the differentiator is quality, how does it play out in each link of the chain? Does the client have the best outside suppliers? Does it have proprietary internal processes, such as Six Sigma at General Electric? Does it have the most modern technology and systems for delivering its products, services or software? Does it have special training programs in customer service that improve results and customer satisfaction? Think of each of these links as building blocks in overall corporate image, creating ongoing PR opportunities to various audiences through a wide range of media. Find good stories along the value chain. Bring the positioning and differentiation to life with solid, compelling evidence by promoting the quality of each link and its accomplishments. Then, wherever people turn, they are able to see evidence of your reputation as it grows.

 

Once you’ve identified these pillars of your image and reputation, candidly assess whether you can provide supporting evidence — proof of principle — over the next three to five years. If the answer is yes, then press on. If not, then reevaluate.

 

3. Target external audiences

Analyze your multiple target audiences and how each receives its information. Building a reputation with multiple audiences is mandatory since no audience operates in isolation. A landmark book called “Diffusion of Innovations,” by Everett Rogers of Stanford University, evaluated the introduction of inventive products and technologies. He found that the most successful companies build communications channels and relationships with the leaders of each constituency or network. These leaders, in turn, converse with their personal networks. The networks often overlap at the top, buzz builds and reputations grow.

 

In one case, Gable PR built credibility for a new technology among academic leaders in the field prior to commercial introduction. The next step was to educate the most high-profile media covering the emerging industry. They were pointed to the academic community for validation. Subsequent media coverage provided validation to the investment banking community, which then invested significant capital in the company on the way to a successful IPO.

 

The same multifaceted approach can be used successfully to build reputations and support growth for new biotech companies, research institutions, scientific applications, software products, professional and financial services firms, and in crisis communications.

 

4. Create a compelling vision and evocative messages

How do you communicate with each constituency while building image and relationships in the process?

 

Examine your core values and determine how you want to be known to each public. Then start creating the foundation for an integrated messaging strategy. Most organizations waste a lot of time talking about vision and creating mission statements that appeal to internal audiences only. To test your statement, read it to several business acquaintances or outside advisers. If they are silent, have quizzical expressions on their faces or howl with laughter, then go back to the drawing board.

 

Delve into the company lore to find real stories that bring your vision, position and core values to life. In his book “The Body of Truth,” Dan Hill says telling good stories that resonate with your audiences can enhance corporate branding. Likewise, they can provide supporting evidence for the desired reputation and your core values and bring your organization to life in new and creative ways.

 

Culture can be another differentiator. Is it collegial, innovative or quirky in a positive way? The people bringing these attributes to life become ambassadors to further build the organization’s reputation and long-term relationships.

 

5. Draw the strategic road map

Creating an enduring image and reputation doesn’t just happen. It requires a planned, disciplined approach similar to building a great skyscraper. Set the vision and then develop a master timeline over the next two years to begin bringing it to life. Use project-management software or other tools to plot your plan.

 

Include company and industry milestones, such as new-product launches, media or analyst tours, grand openings, analyst reports, published studies, corporate milestones, breaking ground on a new facility or presentations to major conferences. Analyze what’s there, then take a look at the flip side. What’s not there? What’s missing? Brainstorm on how to take the plan to an even higher level.

 

When viewed in the macro, individual elements can be orchestrated to create significant image momentum. Leverage one activity or milestone against the others, such as using positive media relations to influence analyst relations, shareholder relations or attention at a major trade show. Determine how to involve strategic partners or others in building the image through joint ventures. Schedule advertising, direct marketing, e-mail marketing and additions to all of your social marketing outlets to hit just after a media relations blitz. Then repeat this over time.

 

6. Assemble the tactical tool kit

Programs need to be segmented to reach each channel and to be implemented with the specific tools best suited to drive results. These can include internal relations and communications, media relations, community relations, corporate contribution programs, social networking (blogs, YouTube, Facebook, etc.), special events, trade show and conference programs, cause marketing, direct marketing, Web sites, collateral material and other tactics. Reaching narrow segments usually requires more direct, personal approaches while consumers and investors can best be influenced through media relations.

 

7. Dare to be measured

Establish metrics to gauge if the image is building according to plan. Start with quantitative measurements, such as tracking the amount of coverage, speeches made, seminars held, blogs posted, hits to the Web site, calls to the 800 number, e-mail requests for information and whatever other measures are appropriate. Watch trends in each area on a regular basis to see if adjustments to the plan are required.

 

That’s raising the noise level. A tougher but more important measurement is performing qualitative analysis at regular intervals to determine if the positioning is getting through and helping the reputation move in the desired direction. Conduct a baseline analysis when the program is launched, then measure progress at least once every 12 months, but preferably every six months. This allows for more rapid course correction should the program not evolve as planned.

 

Another consideration is share of voice. Are you rising above the competition with the amount of positive coverage? Some companies with huge budgets resort to spam and send news releases,  yet end up with little share of voice because the messages don’t get through. In our experience, small, creative, nimble and intelligent companies with solid core values, compelling stories and personality can garner attention and increase market share against the biggest companies in the world.

 

In one instance, a startup digital microwave company launched a new product in an existing spectrum against the two dominant companies (combined 80 percent market share). The founders had distinctive personalities, and they chose to pursue a reputation based on brashness, technological superiority, lower cost and convenience. They selected their first customers based on name value to create memorable stories. They introduced the new product at a press conference with a magic theme, where they enlarged a model of a competitor’s product to reveal their product inside — at 1/50th the size, requiring just hours of installation instead of days. In short, the technology was superior (proof of principle), the founders were interesting (they soon became viewed as visionaries in the field) and the reputation grew (the company gained market share, went public and even irritated the market leaders, who wrote defensive letters to trade journal editors complaining about coverage of the new company).

 

8. Conduct ongoing reality checks

Beyond the metrics, organizations need to conduct ongoing reality checks of their messages to make sure that they are communicating with their different constituents, not just themselves. Another test is to ask yourself if you are relying on jargon. How do your messages compare with those of respected competitors or companies you admire in other niches? Do the core values and central themes come through in all that you do? Or are you just adding to the volume of hype and unsubstantiated claims of leadership? Analyze and adjust as needed to ensure that you are being true to your image and reputation.

 

The bottom line

Incorporating image as part of corporate strategy and investing in reputation management requires a diligent, strategic approach. The tactic needs to be creative, consistent, targeted and factual in support of an organization’s long-term business and marketing plans. It has been proven that investing in a quality image provides an ongoing return that organizations can measure in many ways, from internal pride to the bottom line. n

 

Tom Gable, APR, Fellow PRSA, is founder and CEO of Gable PR. A former financial journalist, he is author of “The PR Client Service Manual” and a frequent speaker at national conferences and teleseminars. E-mail: tom@gablepr.com.

 

View Comments