Quoted in Small Capital

I was quoted today in an article called ‘’How to start marketing your Business” by the website smallCapital – The practical guide for SME’s in South Africa.

Read the article at: http://www.smallcapital.co.za/how-to-start-marketing-your-business/

Trust in Business on the wane

I just read the results of the 10th Edelman Trust Barometer. There are so many lessons for Reputation Managers and those driving strategy and policy in these results.

The survey’s major finding is that nearly two-thirds of informed publics or stakeholders (62%) trust corporations less than they did a year ago.

When respondents in the United States were asked about trust in business in general, only 38% said they trust business to do what is right — a 20% plunge since last year — and only 17% said they trust information from a company’s CEO. Both are lower levels of trust than those Edelman measured in the wakes of Enron, the dot-com bust, and Sept. 11.

"It has been a catastrophic year for business, well beyond the evident destruction in shareholder value and need for emergency government funding," said Richard Edelman, president and CEO, Edelman. "Our survey confirms that it’s going to be harder to rebuild our economies because no institution has captured the trust that business has lost — trust is not a zero-sum game. Business must recast its role in society and move beyond simply generating ROI to its shareholders. It must partner with government and other institutions to assume societal responsibilities."

The Edelman Trust Barometers explores trust in four institutions: business, government, media, and NGOs.

Seventy-seven percent (77%) said they refused to buy products or services from a company they distrusted — the first time the survey explored people’s direct actions toward trusted and distrusted companies. Seventy-two percent (72%) criticized a distrusted company to a friend or colleague.

Respondents say being able to "trust a company" is one of the most important factors in determining a company’s reputation. Among a global audience of 25-to-64-year-olds, trust ranks just below the quality of a company’s products and its treatment of employees — more important than a company’s financial future, job creation, giving back to the community, and innovation in products and services.

Transparency, defined as frequent and honest communication, also outranks those attributes.

Sixty percent (60%) said they need to hear information about a company three to five times before they believe it. Specialists remain the most trusted purveyors of information about a company, with 62% globally saying an academic or expert on a company’s industry or issues would be extremely or very credible. Employees and peers are also considered credible sources of information about a company, with 47% trusting what they hear from "a person like yourself" and 40% trusting conversations they have with employees.

"To regain trust and re-earn the mantle of authority, business needs to make substantive shifts in both policy and communications," said Mr. Edelman. "This means forging partnerships, effecting real change in business practices from executive compensation to supply chain, and communicating all with transparency. Without this type of public engagement, which fuels trust, it will be difficult for business to help rebuild the financial system or earn the license to innovate, much less operate."

Other key findings of the 2009 Edelman Trust Barometer include:

• Trust in nearly every type of news outlet and spokesperson is down from last year. Trust in business magazines and stock or industry analyst reports — last year’s leaders — decreased from 57% to 44% and from 56% to 47%, respectively.
• Globally, only 29% trust information about a company from a CEO — down from 36% last year.
• Only 13% trust corporate or product advertising — down from last year’s low of 20%.
• In the U.K, France, and Germany, trust in business was already at a low level of 36% among our tracking audience of 35-64-year-olds — and stayed there this year. The only EU countries where business made a notable gain in trust were the Netherlands and Sweden.

Learning Points: As I tell audiences over and over, Reputation and trust goes hand in hand together. Violate trust, damage reputation.

About the Edelman Trust Barometer

The 2009 Edelman Trust Barometer is the firm’s 10th trust and credibility survey. The survey was produced by research firm Strategy One and consisted of 30-minute telephone interviews conducted using the fielding services of World One from November 5 – December 14, 2008. The 2009 Edelman Trust Barometer survey sampled 4,475 informed publics in two age groups (25-34 and 35-64). All informed publics met the following criteria: college-educated; household income in the top quartile for their age in their country; read or watch business/news media at least several times a week; follow public policy issues in the news at least several times a week.

About Edelman

Edelman is the world’s largest independent public relations firm, with 3,200 employees in 53 offices worldwide. Edelman was named "Large Agency of the Year" in 2008 by PRWeek and a top-10 firm in the Advertising Age "2007 Agency A-List," the first and only PR firm to receive this recognition. CEO Richard Edelman was honored as "2007 Agency Executive of the Year by both Advertising Age and PRWeek. PRWeek also named Edelman "Large Agency of the Year" in 2006 and awarded the firm its’ "Editor’s Choice" distinction. For more information, visit http://www.edelman.com/trust/2009/.

Karl Marx had a point

Karl Marx had a point.

In his book, Das Kapital he wrote in 1867 and I quote:

"Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism".

Makes you think, doesn’t it!

Sorry, Nedbank!

Powerlines newsletter mentioned in Bernstein Crisis Blog

I am pleased to announce that Bernstein Crisis Management, one of the foremost crisis firms in the USA did a piece on my last Powerlines newsletter on their blog: http://bernsteincrisismanagement.blogspot.com/  (Wednesday, 18th February)

I find it pleasing and disconcerting at the same time, that my newsletter is more appreciated in overseas countries than in South Africa.In the last newsletter I asked whether readers prefer it to be text or PDF based. One writer from overseas wrote, he doesn’t care, as long as I continue sending it, because every month he finds something useful in it.

Yet, every month I get a lot of South African readers unsubscribing, yet gain more readers from other countries. Is my writing to advanced? To Rocket scientist-like?

Or is it plain and simple, just that South African readers do not understand the value of reputation as an asset and as an institution’s biggest risk?

Or is it that they underestimate the danger of potential crisis?

What is it? What am I doing wrong?

Technorati Tags: crisis,reputation risk,newsletters

Timeless Quotes

When I was a kid, my mom used to have this little box, which my brother and I had to draw a small slip of paper from. This piece of paper contained our Bible verse for the day, and that verse we were asked to cherish and think about.

I guess old lessons die hard.

Lately, the box has been empty, but just now I saw two quotes in an e-mail that I thought would be useful for sharing:

"Learn to use ten minutes intelligently. It will pay you huge dividends."

– William A. Irwin

"Don’t mistake movement for achievement. It’s easy to get faked out by being busy.

The question is: Busy doing what?" — Jim Rohn

If you have never read or heard about the Getting Things Done philosophy, I would suggest that you do your homework. It may just be the breakthrough tool that you need to set your career on fire and build a reputation for achievement.

Stakeholder Reputation Master Class postponed to 25 – 26 Feb

The Stakeholder Reputation Master Class scheduled for 10 – 11 February has been postponed to the 25th – 26th February.

Check out the Master Class details at – http://stakeholderreputation.invite43.com/

An Institution’s reputation is derived from the way it is perceived by its various stakeholders. To build and protect reputational capital, it is vital that the interface between an institution and stakeholders be carefully and strategically managed. This program closes the link between stakeholders and the management of corporate reputation.

This course is designed around a practical Stakeholder Relations model providing participants with the methodology, the associated tools and the confidence and understanding of Stakeholder Management concepts and Reputation Management best practices; so that they can develop a Stakeholder Relations management and engagement program for the institution.

This course is designed for Managers interested in the management of corporate reputation and quality of relationships. It is of particular benefit to Corporate Affairs, Corporate Responsibility Officers, Corporate Communication and Public Relations practitioners.

There is an Early Bird special available until the 11th February and you can save R 1190 if you make use of that special.

The 4 Step Reputation Focused Decision making Model

Forget what you have been taught about decision making!

I have a different thought approach that you may wish to consider, that is, if you cherish your reputation and that of your organization.

Every decision that an organisation must make has four broad sets of implications. The obvious three sets of implications are operational, financial and legal.

Thus: Is it legal? How much will it cost? Can we implement it?

The fourth set of implications is generally ignored, delegated or included in the process only on the basis of the "gut instinct" of one of the participants. Or even worse factored in, once stakeholders have reacted negatively. This fourth set of implications is reputational.

The reputational implications of a business decision can be defined as those that impact the way in which an organization is regarded by those with whom it interacts, including shareholders, customers and employees, as well as suppliers, government regulators, the media and even competitors (and any other stakeholder).

Any organisation is dependent on its stakeholders for support and the strategic importance of any stakeholder depends on how dependent the organisation is upon it. And this relationship can change over a period of time or due to indiscretions.

It is important to realise that a decision has reputational implications if it has the potential to affect the relationship between the company and any of these stakeholders. In other words, it is difficult to think of a decision that does not have reputational implications.

In Health & Safety circles the judge applies the reasonable man principle to decisions taken. What would a reasonable man have done?

Every decision made should be put through the 4 point test

1. What is its financial impact?
2. Is this doable, legally?
3. Is this practical?
4. What would be the reaction of our various stakeholders, should we make this decision?

Thus the ultimate question: What is the risk to our or my Reputation?