Senior communicators came together at a recent Comma Partners event to explore the role communicators play in managing corporate reputation. The lively debate was led by Nick Wright, an independent communications consultant, previously Communications Director of accounting and business advisory firm BDO and a Director at Fishburn Hedges.
Some of us remember the Andersen and Enron fiascos, certainly the banking crisis and more recently Thomas Cook, Alton Towers and of course VW, where the emissions scandal hit the headlines in the autumn and continues to reverberate around the world.
Crisis what crisis?
“It’s easy to look back at famous crises and see how organisations messed up.” said Nick Wright. “Yet inside these crises are often very competent comms teams but there are many forces that get in the way of reputation protection and communications that support it,” a point clearly demonstrated using the tragic Thomas Cook case as an example.
Nick Wright told us: “I was struck by the role communicators played, notably in their relationship with the lawyers. It is not uncommon in these situations for the latter to hold undue influence. Take the inquest itself and a quote from a barrister –
“My clients would like to know whether you want to apologise to them.”
TC representative –
“I decline to answer that.”
The media were scathing, with Jim Armitage in the London Evening Standard, post-inquest, describing the “company’s gruesomely legalistic stance” which “had been in train for years”. An investigation commissioned by Thomas Cook soon after the inquest and led by former Sainsbury’s boss Justin King, confirms this view:
“…it is clear, in my view, and should be noted that the legal backdrop to the case weighed heavily on the decision making of the company. Decisions were often not taken in the thoughtful and caring way you would expect from a company such as Thomas Cook. The fact that this tragic situation spanned almost 9 years is testimony to how much the legal, rather than the human considerations dominated the landscape.”
“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” Warren Buffett
“Forging relationships with lawyers before the crises can really help the communicators’ voice be heard, but in this case something went seriously awry. Yes, the leaders of the business who should have known instinctively what was the ‘right thing’ to do have a case to answer, but it’s important the communicators case is heard and we are confident and bold in giving best advice.” Clare Lucraft, an interim specialising in internal and change communication, agrees: “Legal opinion is just that. Opinion.
As communicators we can and must challenge the lawyers’ advice if it is negatively impacting the tone of our communications and approach.” In the Thomas Cook case this, of course, may have been the case, but the advice may have simply been ignored.
Accountability and empowerment
For Diana Robertson, a communications consultant with a background in both internal and external communication, the whole issue of crisis management rather misses the point:
“I wonder if corporate reputation has become an industry in its own right. Something separate from the day to day way a business runs, terrifically important and yet only in the spotlight when there’s a crisis. Are we in danger of placing it on a pedestal? In an ivory tower… in the 19th century this was a phrase used to ‘designate an environment of intellectual pursuit disconnected from the practical concerns of everyday life; specialists so deeply drawn into their fields of study they can’t find a lingua franca with laymen’.
Is that what corporate reputation has become? A rarefied pursuit that lives within the external affairs teams to be managed only at the point of crisis?”
There is clearly a time for crisis management – the dealing with the now; the impact upon reputation. But what of building the reputation in the first place?
Nick Wright: “Reputations are important for brands, contributing directly to their shareholder value – the UK Reputation Dividend Report, now in its 9th year, lays this out in detail. The value attributed to reputation is now so significant that it shapes communications and investment strategies.”
Diana Robertson continues: “If we believe, as I’m sure we do, that the reputations of organisations stand or fall on how they deliver to their customers; how they deal with their employees; how they deliver for their shareholders; on their values, their honesty, their integrity: on the way they do their business – then surely the management of corporate reputation has to sit at the very heart of a company?”
Strategic culture, leadership and communications consultant, Alasdair McKenzie certainly agrees.
“Reputation is in the hands of every employee, ingrained in the business processes. While this sounds dry, it’s also pretty crucial. For example, if how a company responds to complaints is seen as a litmus test for whether they mean what they say, you need a process and empowerment so the communicator isn’t just saying ‘we take all issues seriously’, but the way the complaint is handled demonstrates that the issue is taken seriously. In practice what I’ve seen is that when things are talked up as important, but processes mean people are not empowered to act, you end up with a culture of fear and blame as people try to pass the buck. This is where communicators who are close to their audience can be honest brokers in getting the process issues fixed.”
Looking again at the Thomas Cook case, Nick Wright concurs: “In the report, the mismatch between accountability and empowerment was clearly highlighted:
There is a mismatch across the business between the accountabilities people have, and empowerment to deliver against these. This failure is both structural and cultural.
Karen Kimberley, a consultant and coach, added: “We all know how powerful the voice of the front-line people can be – those on the shop floor, engineers in people’s homes, call centre teams and the like. It’s essential to empower them with the right processes to get things done but also with the right communication messages. It’s really frustrating for them when they don’t have the answers and for customers too, who expect them to know.”
Putting people before profit was a thread of the discussion throughout the event. Indeed, putting humanity back at the heart at of corporate decision-making was seen as wholly positive.
Karen Kimberley again: “ Isn’t being human as a leader one of the key issues of the day, both in terms of engaging people and credibility with customers? As communicators we have an important role to work with leadership teams to instil the right attitude and culture throughout their organisations. They need to lead by example.”
The fact is, bad stuff happens. It’s how organisations deal with it that determines their reputation in the longer term. When news of TalkTalk’s 2015 cyber attack broke, Chief Executive Dido Harding’s swift response was well received. She was honest, contrite and in control. And she held herself, as leader, fully accountable.
Notable too was Nick Varney’s response to the Alton Towers accident. As CEO, his immediate attention focussed on the human story – rightly so – and his sincere apology. This was supported by high levels of internal communication activity and both proactive and responsive social media work. There was no doubting the leadership on that occasion.
In any time of reputation malaise – and of course in crisis – organisations need the support of their people. To rebuild and maintain reputation requires trust and engagement. Communicators have a crucial part to play. Clare Lucraft again: “Getting the tone of voice right is essential and even more important when the company is under stress. All the good stuff we should be doing everyday – active, not passive voice; using ‘I’ and ‘we’; avoiding jargon; keeping it simple and getting quickly to the point of interest for the listener. In fact, getting your stakeholders used to a more personal and straightforward style of communication will help when the chips are down.”
And Virginia Hicks of Comma Partners suggests that: “Interims can really add value when corporate reputation is being challenged. Not only do they bring wider sector experience, great expertise in building good stakeholder networks (and quickly) but more often than not, memories of preparing for and working through similar situations with business leaders, compliance and HR colleagues. They can be less emotional about a situation or a threat to a brand – as they are temporary – and this can be invaluable when communicating in challenging times.”
Anne Graham, internal communications specialist and journalist, shared her mantra for dealing with situations or difficult decisions: “I always expect a simple three-phase approach to be adopted: Firstly, Acknowledge the situation. This makes it clear what the problem is, what has happened and states the facts. Secondly, say Sorry. An apology is essential. It shows that you accept responsibility and understand that there is some human cost and an impact on people’s lives. Finally, put it in Perspective. This is your opportunity to explain what happens next, set out the expectations and describe what it will look like when it is done.”
Invest in good will
For Alasdair McKenzie, consistent messaging is key when rebuilding reputation and trust within an organisation. It is vital that the same key messages are given internally as externally but all too often this is not the case, leaving employees in the dark and ill-prepared to answer questions from customers.
“In a recent turnaround situation I was a part of, the messaging on the business’ recovery internally was the same as that shared with investors & analysts, with the same source used for key messages to financial media. This meant that leaders and colleagues did not feel they were being spun a line, but saw that they were being treated with the same seriousness as the outside world.”
“If the internal and external messages are not consistent (for example if a company admits internally that the situation is worse than they are saying externally) there is a high chance of this leaking and the bigger the organisation the bigger the risk.” explained Alistair Cantlay, an internal and change communications interim whose most recent clients are in banking.
“Employees are more than just employees now, they are customers, opinion formers and social media influencers with your organisation’s reputation in their hands. Being straight up and honest with your employees is absolutely essential and leadership teams must be good at communicating regularly, communicating consistently and making sure that they are dealing in facts and not spin.”
“You certainly need to invest in the bank of good will.” adds Clare Lucraft. “Having good relationships with journalists and other opinion formers, and with your own employees is really important. It’s not that they won’t write or say the bad things about you, but they will do you the courtesy of asking for your side of the story first, perhaps giving you the benefit of the doubt.”
Can the management of corporate reputation be moved from reactive crisis management to proactive management of trust and engagement? Because that’s what needs to happen. There is no question that internal comms has an important role, but it has to be as an integral part of the organisation. Working together with external comms colleagues, but far more importantly to work with the people who lead the business every day.
It’s not about having something in the bank for a rainy day: it’s about having cash in hand every day.
Communicators’ tips for Managing Reputation
- Employees are not just employees…
- Remember we are all human
- Ask the difficult questions (and keep your job)
- Make friends with the lawyers
- Be patient with external comms colleagues
- Plan for realistic (internal) eventualities as no one else will
- Get in at the start
- ASP: Acknowledge, Sorry, Perspective
- Help to build pride in the organisation
- Don’t wait for a crisis
Nick Wright is a senior communications professional with broad-based reputation, employee engagement and marketing experience on the global and UK scenes. Now an independent communications consultant he was previously Communications Director of accounting and business advisory firm BDO and a director of Fishburn Hedges.
Comma Partners provides internal and change communications managers to clients who need high calibre expertise on an interim basis. Clients and candidates can contact Virginia Hicks on 0208 943 0686 or visit www.commapartners.com
Alison Boothby is a freelance business writer specialising in change, communication, engagement and topical workplace issues.