Reputation Management Part 2

02Oct12

When the group Mothers Against Drunk Driving came under scrutiny for their administration fee rate, it was another case of reputations at possible risk. The charitable industry standard for administration fee is 0.18 per dollar of donation collected. At M.A.D.D.the fee was 0.83, skewing at the other end of the scale outraging donors when revealed. Potential reactions to threats that would tarnish one’s reputation include do nothing, react defensively, or the best strategy of taking a leap of faith to address the issues in a transparent way. By addressing the negative issues, positive results will likely be the outcome as a huge trust dividend as the payoff, as both internal and external stakeholders recognize leaders’ attempts to be accountable and transparent. (M.A.D.D was able to turn around their administration costs to around .30 for a happy ending)

Takeaways  for leaders are don’t be afraid to take action against the risk, a need delegate tasks, develop a team to execute, and let them run with tasks so don’t micro manage. By micromanaging leaders will erode trust in relationship with workers, as workers like democracy. In fact, a huge increase in trust is the payoff for workers and various stakeholders, when leaders can take action against the risk. For library managers and others who manage up, these are good ideas for your back pocket as they have contact with the C-suite.

Often reputation management is during a crisis and becomes risk management of highly irregular events or Black Swans like the Icelandic volcano eruption disrupting worldwide air traffic. But the strategy to address the event can be referred to as formulating initial response, take action, and implement preventative measures. There can be potential barriers to successful risk management from lack of resources, lack of coordinated decisionmaking, or tone at the top is lacking in communicating about changes.

I feel that librarians have an important role to play in monitoring reputations as they are familiar with social media, benchmarking, or identifying issues in advance. Some of these strategies were used in the Michael Bryant situation. Bryant hired a public relations firm Navigator that quickly assessed the situation giving it a good spin. He appeared publicly to make a statement in a clean suit and clean-shaven, despite spending the night in jail after being charged for a crime. The firm also used social media like Twitter and Youtube telling his story in the court of public opinion. Currently Bryant is publicizing a book on his side of the story.

In a case study of the Maple Leaf Foods debacle with listeria-laced meat, the audience viewed and analyzed a series of tv advertisements that were intended to convince consumers it “was doing everything we can to build your trust again.” The ads were proactive in addressing the issues, showed more confidence and detailed a long-term plan to build consumer confidence at 3 weeks and  even 3 months post-crisis. Management at Maple Leaf took risks by being transparent and accountable about their next steps, with payoffs in positive consumer confidence, and positive distributor and retailer responses as results. An ethical decisionmaker is based on transparency, fairness, honesty, compassion, being predictable and responsibility. As a postscript to Maple Leaf, the company was able to settle legal claims in about 7 months for a little over $30 million. It could have dragged out longer for such a complex case, according to Rick Power

Finally positive reputations are viewed through a cultural lens. For example, the Dalai Lama is viewed favourably in the West but not so much in China. Reputations also change over time. At one point  there was a very low moment for Bill Clinton as when he was U.S. President,  but now he has reimagined himself as senior statesman doing good works around the world.

Overall I went away inspired by Rick Powers’ talk, and mulling over managing reputations.

- Brenda Wong

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