THE BLOG
12/30/2013 11:57 am ET Updated Mar 01, 2014

Reputation Trends for 2014

Here's my annual list of reputation trends for 2014. As information increasingly dulls the senses and muddles our brains, and as transparency becomes the norm, building enduring reputations grows in importance. In a new report, Deloitte's Touche Tohmatsu found that reputation risk is the top strategic risk among global C-suite executives (40 percent now versus 26 percent in 2010). Yet, as important as building an enduring reputation is, it remains as elusive as ever. Companies struggle at the task. Reputable companies are still caught in crossfires they did not create, and less reputable companies are overlooked until it is too late.

Being aware of upcoming reputation trends is, of course, always helpful at times like these when companies' good names are only 15 minutes away from shame. In the hopes of aiding companies with their reputation-building, I present my predictions for the year ahead:

1. The "how's" of reputation management.

So many surveys tell companies what they should do to gain long-term competitive advantage. They say to focus on people, product, innovation, citizenship, the bottom line, customers and more. Not bad advice. But how does a company create a single clear narrative when business is so complex, when information is shared within seconds and when a business model is so instantly imitable? Something more is needed to stand out among the crowd. Author and CEO of LRN, Dov Seidman, posits an answer worth repeating -- focus not only on what you are doing, but also on how you are doing it. Do not merely out-perform the competition, out-behave them as well. Seidman might just be right. The most highly reputable companies are hyper-conscious of not only performance, but also of how they build their cultures and their brands. They are nearly impossible to duplicate.

2. Following in Athena's footsteps.

The year ahead will be marked by even greater attention on how women build reputations to get to the top, whether as CEOs or directors on corporate boards. The art of combining both "hard" and "soft" power was the hallmark of Athena, the Greek patroness of the great Greek city of Athens. She was the goddess of intelligence, skill, strategy, inspiration, wisdom, arts and literature. Mary Barra may just be a modern day Athena. She is about to take over the reins at General Motors (GM), ranked number 7 on the Fortune 500, and the largest company ever to be run by a woman. Her climb up the ladder will be studied in great depth, and her unique role as a female corporate leader is likely to give rise to more than a few insights. What marks her reputation is her prior stint to EVP of global product development -- head of global HR. This is not the usual stepping stone for a CEO. She clearly understands that the right people in the right positions add to corporate strength and effectiveness. With such a background, Barra understands that the "soft stuff" (reputation, trust, culture, communications) significantly contributes to the bottom line and a new GM.

(Disclosure: Weber Shandwick works with GM.)

3. Heeding the reputation whisperers.

Distinguished professor, Clayton Christensen, of Harvard Business School says: "Data is heavy. It wants to go down, not up, in an organization. Information about problems thus sinks to the bottom, out of the eyesight and earshot of the senior managers." By the time mega-reputation risks get to the top, they are, in most cases, no more than mere whispers. Leaders need to set up a system where such problems are quickly brought to their attention, and amplified mega-decibels so that problems so obvious to the front line troops may be addressed and reputations kept secure. An increase in board-level reputation committees is one way in which directors may remain sensitive to these slow boils.

4. Shaping reputations LIVE.

Marketing communications circles typically discuss, at great length, brand and reputation-building by earned media (through publicity), paid media (through advertising) and owned media (through branded content, blogs). Much less discussed is another form of content production that shapes reputation -- "live media." Live media -- conferences, summits, forums -- is a fast-growing reputation-enhancer. Indeed, media companies are ramping up their live media business to replace revenue lost from advertising. Atlantic Media, for example, which publishes The Atlantic, among other brands, stages more than 200 events a year, and The New York Times has 16 events scheduled for 2014. Arianna Huffington's Third Metric will be conferenced three times this coming year as well. CEOs and other top executives flock to these live events where they can effectively communicate their messages before receptive audiences and repurpose content through video, blogs and other social media. In our research on Social CEOs, we found that the percentage of CEOs appearing in videos on company websites or YouTube channels increased from 18 percent two years ago to 40 percent now. Live media may well become a prime CEO reputation-maker.

5. Doling out reputational justice online.

Social media provides discontented members of the public with the means to hold flash protests whenever they believe a company, country or individual has acted improperly. Scores of such public square protests, typically staged via Twitter and Facebook, marked much of last year in many countries around the world. They damaged the reputations of both political leaders and countries, and kept tourists and business away. Many such on-the-ground protests morphed into a virile strain of social boycotting, thereby further threatening worldwide reputations. A recent such protest arose over the indefinite suspension of A&E's Duck Dynasty's reality show star, Phil Robertson, for his anti-gay remarks made during a magazine interview. A petition on Change.org, the "go-to-site for web uprisings," aggregated close to 250,000 signatures demanding that the highly-rated star be reinstated. As I write this, A&E has done just that. Robertson has been reinstated. In fact, Change.org has grown exponentially. There are now more than 45 million Change.org users in 196 countries.

6. Employees are the next reputation enforcers.

Who can better defend a corporate reputation than those who work for the company? We already know that disgruntled employees can do untold harm to corporate reputations. But what about those who are satisfied and pleased with their jobs? They can be reputation-builders and be more than willing to offer their services on behalf of their employer. For example, a COO recently was battling negative coverage that was not simply diminishing fast enough. Soon after the coverage started, she opened her email to find dozens of employees offering to advocate on behalf of the company's integrity via social media. They first wanted to know what to say. Pete Cashmore, founder and CEO of Mashable, agrees that employees are an under-used, highly valuable and believable reputation asset. He suggests that employees be given the tools they need to be "foot soldiers for their brands." The next new social movement might just be your employees.

7. Social CEOs have landed.

"Who's the most social CEO?" has become the new reputational thing. Rankings are everywhere listing the most social CEOs in business, tech and non-tech, hospitals, charities and governments worldwide. There are top 30, 60 and 100 Social CEO lists. CEO Richard Branson heads most of them with 3.7 million followers (@RichardBranson). In new research we've done, 76 percent of global executives think it's a good idea for their CEOs to participate in social media. Employees say social CEOs make them feel inspired, technologically-advanced and proud. A large 78 percent of global executives say that one of the top benefits of having a social CEO is its positive impact on reputation. In the coming year, expect that a deluge of CEOs will wade into social waters demonstrating that they and their corporations are future-facing.

8. Gimme one number.

I recently heard about a few companies that were asking reputation consultants for a single score that summed up their reputations. Just one number! That was all that each company thought necessary to evaluate its reputation among key stakeholders. Perhaps, each company wanted only one number because a single such rating would fit nicely into a business dashboard. Not the best idea. What worries me about one number is how much is lost in translation. One number cannot possibly provide the necessary insights and sufficient information to identify and understand where problems lie: What the competition is doing, the extent of customer dissatisfaction and defection, what's being said on social media, what myths and rumors are below the surface, what issues are emerging, etc. The idea of a single number reminded me of the observations of the late Nobel laureate and CalTech physicist, Richard Feynman. Feynman warned that "bulletized" thinking contributed to the deaths of seven Challenger crew members. Bullet points about the O-rings, whose failure led to the disaster, were what were circulated for review prior to the crash, not a full description. This brief description buried the important and critical information that would have prevented the catastrophe. Reputation is too important to be reduced to a series of bullet points, to skeletal rather than full explanations -- much less to a single number.