Author's Name: Mark Schultz
Date: Thu 25 Feb 2016

Reputation management – take care and proceed with caution

When a disaster happens, whether caused by your organisation or by someone/something else, how you manage the situation can either generate goodwill or exacerbate the problem. The board must have a plan in place to manage such a situation eventuating during the course of its tenure.

We often hear of organisations talking about “managing the brand” or “reputation management” during or as a result of something going terribly wrong with its product or services – think about VW and auto emissions, the Commonwealth Bank financial planners, the Catholic Church and the abuse of children and even a local bus attempting to drive under a bridge when it was clearly not going to make it, as a few recent examples. Each of these cases have resulted, in varying degrees, in the organisation having to invest considerable funds in managing the fallout of the situation and trying to limit the long term negative impact on its reputation and therefore its position in the market and future revenues/profits. Here are a few tips on how an organisation should behave in such a situation:

  • Have a plan in place – this means the board has thought about a range of situations arising and, in a relatively stress free environment, considered strategies to manage the both the internal and external responses and approach;
  • Do not treat the public as if they are stupid – there may very well be some unenlightened people in the community however they generally are not in the majority – the public usually sees a situation for what it is, not what is being “ spun”  by spokespersons;
  • If people have been injured, emotionally or physically, have some empathy, do not underestimate the power of such an approach; and
  • Be quick to respond but in a thoughtful and considered manner; a slow response will create even more issues for the business to manage. 

There are many experts in this area who can provide much advice on how to manage an adverse event. However, people are generally forgiving and more understanding if organisations are upfront, honest and genuinely care for their stakeholders. At face value, it doesn’t seem too difficult, but it will take the board to provide leadership, support and resources if an organisation is to survive an adverse event –  and good governance demands such an approach.

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