Every tenth-grade algebra equation starts with understanding what you’re solving for. Similarly, a good business plan starts with a current state assessment and/or “solve for” statement – a clear articulation of the issue at hand and the desired state. Remarkably, when it comes to managing corporate reputation, companies often overlook this basic step. They aim for some amorphous idea of improving perceptions or increasing awareness among a broad set of stakeholders. It’s the old “not seeing the forest through the trees” syndrome.
To better understand a “solve for” approach to planning, let’s take a look at two common business problems.
PROBLEM ONE: ATTRACTING TOP TALENT AND EMPLOYEE RETENTION
The Issue:
With the unemployment rate below four percent and an increasing number of baby boomers reaching retirement age, companies are struggling to recruit and retain the best talent.
Expectations and Considerations:
Expectations are changing for both prospective and existing employees. They expect companies to be socially engaged. Consider this:
According to Project ROI, a well-designed corporate social responsibility program can increase employee engagement up to 7.5%, increase employee productivity by 13% and reduce employee turnover by 50%.
Fortune Magazine published a study in February 2018 finding “Staffers who believe their organizations give back to the community are a striking 13 times more likely to look forward to coming to work.”
Nielsen reports that 73 percent of Millennials prefer to work with socially responsible companies. Millennials are looking for companies that give back to society by getting involved, being transparent about their socially good efforts and giving opportunities to get involved with the company’s efforts.
Solutions:
In today’s world, social impact is a KEY component of any successful corporate reputation-building strategy. Finding the societal issue that your company is uniquely suited to address and providing the financial and human resources to make a measurable impact will not only help attract and retain employees, but will also impact a company’s reputation with all stakeholders.
PROBLEM TWO: MANAGING STAKEHOLDER PERCEPTION IN THE AGE OF SOCIAL MEDIA
The Issue:
We are living in the megaphone era. Stakeholders are armed with 24/7 media tools which influence the choices, actions and reputation of businesses today.
Expectations and Considerations:
A recent report from Pentland Analytics studied 125 “reputation” events over the past ten years and found that since the advent of social media, the impact of a reputation event on stock price has doubled. The report continued to show that a company could gain up to 20% or lose up to 30% based on their preparedness and reputation strategy. Perception of honesty and a sound social responsibility strategy were seen as key factors in recovering from a crisis.
Solutions:
Improving reputation in today’s environment requires transparency, authenticity and consistency in what a company says AND what it does. It requires enterprise-wide cooperation: from Operations to Communications to Human Resources to Governance.
Have Clarity in Problem Solving
The problems and challenges facing companies are certainly different, but having a strong reputation is foundational to solving them. Before launching a reputation-building strategy, be clear on the issues you’re trying to solve, the stakeholders you’re trying to influence and the behavior you want to drive.
Whether it’s being the number one choice for top-talent, meeting changing customer expectations or influencing public policy, leaders will only be successful when they understand their specific issues and the drivers of stakeholder behavior. Only then can they build specific strategies to enhance reputation and solve their unique problems.