Like most people, public service leaders intuitively understand the value of reputation – their own and their organization’s. They know how a good – or not so good – reputation can strongly influence trust, which in turn will influence their real and perceived efficiency and effectiveness.
Yet despite recent advances in risk management, especially regarding operational risks, reputation risk is rarely acknowledged. Most organizations are content with developing essentially reactive mechanisms focused on damage control and crisis management. A bit like having first-aid kits on all floors, but not thinking of awareness and prevention.
There is, however, a growing body of literature about reputation and trust as well as recent examples that illustrate the benefits of “reputation stewardship.” After defining briefly what is reputation risk and why it warrants deliberate efforts, we will see how public institutions can and should significantly improve their management practices to achieve a strong and sustainable corporate reputation.
Why should organizational reputation be of concern to public service managers who often lead organizations that are not primarily concerned with the bottom line, are quasi-monopolies and can use laws or regulations to enforce their mandate?
When reputation is good, trust is high. Collaboration and teamwork are more sustained, which fosters the achievement of desired outcomes with less effort. Conversely, when reputation is poor, trust is low and everything slows down. Suspicion reigns. Much time and effort are spent watching over one’s shoulder. People and organizations react to protect themselves by adding rules, excessive process and oversight. Approval processes are mired in red tape. Risk aversion is the norm and innovation wanes. Opportunities are missed and government becomes more reactive. Effectiveness and efficiency decline.
An organization that enjoys a positive reputation among its many stakeholders will have fewer rules and lower transaction costs. It will also more easily attract top talent and will have a higher retention rate. Change management will be easier and employee engagement will be stronger. When that well-regarded organization fails to meet expectations, it will be able to draw on its accumulated reputational capital to restore the lost trust and continue doing business efficiently.
Perhaps most important, trusted organizations are generally perceived as better performers, leading to greater citizen satisfaction, which in turn engenders greater trust. The benefits of a strong reputation and of high levels of trust are so significant that a sustained and coordinated investment in “reputation stewardship” is easily justified.
Reputation stewardship can be defined in a number of ways. It is as much a mindset, influenced by corporate culture and context, as it is a structured process to be implemented consistently throughout the organization.
Leaders who support and implement reputation stewardship help ensure that their organization’s reputation contributes to the achievement of its overall objectives.
In brief, here are the five typical elements of effective reputation stewardship in a public sector organization:
- Define: Based on the organization’s mandate, objectives, operating context and stakeholder expectations, decide which reputational attributes need to be established and projected. For example, a science-based department would want to be recognized for sound research and implementing evidence-based policies. A service delivery department would want to be seen as fair, equitable and responsive. These attributes must be fleshed out so that all managers and staff know what behaviours, attitudes and actions are needed for various stakeholders to believe that the organization performs as expected.
- Assess: In light of the desired reputational attributes, do a “reputation audit.” Verify, through surveys, focus groups and other qualitative instruments, how “mission critical” stakeholders really perceive the organization’s reputation. Then, following a gap analysis, determine which attributes require attention.
- Build and maintain: Through repeated and consistent achievement of expected results, demonstrate to stakeholders that the organization is indeed worthy of desired reputational attributes. Communicate success stories widely – including to staff – and reach out to the most important stakeholders. Seek third party validation when useful.
- Scan and monitor: Develop a wide internal network of “watchers” to proactively identify and flag any event, information or situation that, if not addressed, could lead to loss of reputation. Develop clear reporting mechanisms to ensure timely analysis and quick response. Watch for and seize opportunities to strengthen reputation.
- Defend: Develop and implement a structured issues management capacity to avoid, mitigate or address all problematic situations in a timely and effective manner. Keep watching for flare-ups.
Evolving from a mostly reactive to a more proactive reputation risk management can be difficult. It will likely require a sustained, corporate-wide and deliberate effort. Success will depend on:
- Senior management recognition of the importance of trust in and outside the organization and of the impact of reputation on the achievement of their objectives;
- Sustained and deliberate commitment to becoming more proactive in managing reputation risk;
- Widespread awareness, among all staff, of what is reputation stewardship and of each player’s role in achieving it; and
- Evergreen approach to assessing the organization’s perceived reputation and updating it to reflect evolving expectations.
Public sector leaders hold primary responsibility for the overall achievement of their organization’s mandate. Reputation stewardship in one of the many aspects of sound governance they must pay attention to. It is not rocket science but it requires a deliberate effort, sustained over time by all members of their organization.
Denis VÃ©zina is a retired federal communications executive. As president of D.V.-CO Consulting, he helps people achieve success through better communications.
Reputation and trust: the Coles Notes version
Here are a few basic facts about reputation and trust:
- Reputation is largely about perception. It is how others see you and your organization.
- Trust emanates from the sustained convergence of character, intent and competence, as well as the level of congruence between expectations and performance. These are continuously assessed based on reality as much as on perception.
- Perception is fickle, highly subjective and easily influenced by sudden events, context, values, beliefs, rhetoric, prejudice, changing expectations, etc.
- In the absence of first-hand experience, and even then, perception often trumps reality.
- Reputation, like trust, is built over time, through repeated behaviours and actions that reflect organizational values.
- Reputational capital accumul