My good friend and PR guru, Eric Bovim (Eric and Tom Pernice are the founders of Gibraltar & Associates, one of the preeminent and innovative public relations firms in the country) and I were discussing Harris Interactive's new data. We'd like to take you on a tour of what Americans think about American companies. In the wake of Greg Smith's op-ed piece in the New York Times last week about the culture at Goldman Sachs, it's even more timely information.
The 2012 Reputation Quotient (RQ), a survey of 18,000 Americans, now in its 13th year, tracks the perception of America's most visible companies and produces an RQ score for each.
This year's batch of RQ scores comes as no surprise. Less than 20 percent of those polled viewed corporations positively, and 60 percent felt corporate reputation had declined. The number of companies with "excellent" reputations, as determined by Harris, fell by half from last year. Financial services and banking companies came out of the survey badly bludgeoned -- Bank of America, AIG, Berkshire Hathaway, Wells Fargo, JP Morgan Chase and Goldman Sachs suffered the worst drops in RQ scores on the entire list.
It should be noted that, historically, companies whose RQ score drops below 50 run a significant risk of being taken over by the government or going out of business -- some examples include infamous flameouts like Enron, MCI, WorldComm and Global Crossing, as well as mangled brands like Halliburton, Fannie Mae and Freddie Mac.
What can be done about this? Here are our top three success tips:
#1: We are in a moral crisis. Our collective trust has been broken. It is time for a values revolution. A moral renaissance, if you will, where how you're doing business is more important than what you're doing (the product or service). CEO's: Time to add a Chief Culture Officer to the "C" Suite. To task someone with discovering how to convert your mission statement into a living, breathing cultural organism, where every day --day-in and day-out -- you and your team are walking your talk. It is time for behavioral corporate therapy.
#2: Consumers are looking for authenticity. They want an honest and thoughtful relationship with the companies that produce products and services they buy. Truth and honesty creates an emotional commitment. Emotions drive sales. Kodak is an example of a company that lost its way, however, it wasn't when people stopped buying film, but when they forgot Kodak's mission was always to help people capture memories. What, in the end, would Disney really be if it were not a company about fantasy?
#3: Great 21st Century brands wholeheartedly embrace corporate social responsibility (CSR). For them, it is not a mere line item in the public relations budget -- it's in their DNA. For example, Starbucks' CEO Howard Schultz made a bold and brilliant decision last year to sell wristbands in his stores to provide capital to American small businesses. "If banks wouldn't do it," he thought, "why can't we?"
So why do we have such a pessimistic view of our nation's companies? In the business of doing business, it would seem that many American companies have become value talkers, not value walkers. As a result, their commitment to the public good is not embedded in how they do business. True, just about every company nowadays has some kind of flashy marketing campaign or a new CSR initiative. But the public, as evidenced from the survey, knows the difference between the real thing and a façade. This is not about only checking off the right "we care about you" boxes (day care, employee discounts, philanthropic donations), it is about ensuring that your values impact and sculpt every decision you make. The result: employee and consumer trust.
Don't despair: Rebuilding a tarnished reputation is possible. In the age of social media, this feat has never been more possible. But the stakes are higher. Today's consumer has instant access to abundant, raw information and demands more from a company than simply a product. Emotional appeal, according to the Harris survey, stands alongside financial performance and products and services as key factors in overall RQ scores.
The brands that struggle in the marketplace of perception must do more to behave in moral and just ways, leverage social media, embrace CSR and offer a more authentic vision of themselves in the world. Their definition of wealth must transcend money: We are a wealthy company because we are heavily invested in the community, in the global village.
In the end, the paradigm shift has happened: consumers want to buy more than just a product. They want to support values, morals. They want to support a belief that goodness and commerce can, indeed, coexist.
Debbie Robins: Named one of the top Leadership Coaches in the country/Trained Chief Consciousness and Culture Officer
Eric Bovim: Named as one of the top 40 under 40 public relations executives in the country by PR Week. Eric and Tom Pernice are Founders, Gibraltar & Associates.