The Resiliency Concept: It's All About Trustmarks

The future will be dominated by competition for public trust. People are increasingly turning to "trustmarks" to sort through the cluttered information economy marketplace. For organizations interacting with the public, trustmarks will supersede the trademarks of old. A trustmark goes well beyond a good brand name; today, people are seeking guidance of a higher order.We want to be able to judge quickly if the information coming our way - about products to buy, decisions to make, causes to support - is authoritative, credible, and reliable. We aren't seeking a signal about the quality of the product as much as the trustworthiness of the producer, whether it is a corporation, a charity, or a political leader.

As the default position tends to be set on scepticism rather than trust, the trustmark holder possesses a rare and valuable asset. Leaders must excel beyond the traditional management skills of finance, strategy, and marketing to master the political skills necessary to forge trusting relationships with the new knowledge consumer/citizen, as trustmark stewardship will become one of the top tasks of modern CEOs.

The marriage of the most highly educated generation in history and the Internet places phenomenal power in the hands of a newly enfranchised class of knowledgeable citizens and consumers. Information has been democratized, giving rise to heretofore unprecedented demands for choice.The "no alternative" mentality no longer suffices; we will create our own alternatives if the official offerings don't satisfy.

Indeed, the lode of information now available to individuals and groups is giving rise to a revolutionary power shift from producers to consumers. Producers are under pressure like never before to deliver results and be accountable for performance. Combine this heightened consumer assertiveness with a diminution of brand loyalty and the potential exists for businesses - despite having taken decades to build - to be destroyed in the blink of a cursor. The challenges posed by the new knowledge consumer/citizen are obvious, but so are the advantages for those who can relate to a more informed and wilful population. When we paint this picture for our clients, the obvious question comes back: "Okay smart guy, what do I do about it?"

Until recently, our answers were less than satisfying.That's because the canon of corporate reputation research we could reference was weak. As much as clients desire to understand and effectively manage their organization's reputation, they also crave a reliable measurement tool that shows the value of what they do for their employers. In this regard, public affairs professionals are at a major disadvantage at the boardroom table. Sales professionals can reference sales data, operations managers can reference supply chain statistics, and finance professionals have their financial reports: what does a public affairs professional have to show for their efforts - press clippings?

The ideal tool for a corporate reputation measurement must be able to help manage a company's reputation and be able to stand up to scrutiny from senior corporate executives. Like so many things, the best solutions to a complicated problem emerge from combining lessons across disciplines. In this instance, it's political polling, issues management, brand equity, and loyalty.What has emerged from our ongoing innovation activities is the core concept of our new proprietary corporate reputation tool: resiliency.

Resiliency

Measuring corporate reputation is more than assessing favourability and ratings on key attributes. Ipsos Public Affairs has developed a new approach that enables clients to understand their corporate equity and its resiliency: how easily their corporate equity can be carved away or enhanced by media coverage and communications. The development of the resiliency model shows that it is difficult for a company to compensate for negative press by communicating a positive story (ask any politician who has been the victim of a negative ad campaign). Our research indicates that a negative message or incident, such as a strike by workers, can have a significant impact on overall reputation, whereas a positive message, such as an award for environmental stewardship, can have very little impact.

Negative messages associated with financial reporting and those associated with the workplace were shown to detract from the overall reputation of a company more than messages on customer service or product quality. However, none of the positive messages tested had a significant impact on corporate reputation. There are five key business measures that are standard to the resiliency model: trust, loyalty, likelihood to recommend the company, workplace, and investing. Various categories of communications have been tested, including customer service, product quality, citizenship, and financial reporting.

A summary of the impact of positive and negative messages on the five business elements is shown in Table 1.

The model also enables us to establish norms for overall opinion, on the five business elements, and on the expected shifts in opinion. Further, we can determine the messages that will be most effective in enhancing reputation and the messages that would be most detrimental to reputation. We can also segment the marketplace to determine the profile of consumers most affected by key messages. Standard penaltyreward analysis and competitive mapping can also be conducted under the model. One of the key findings from our research so far is that likelihood of recommending the company to family and friends was the most significant driver of overall reputation of the five business elements that were included in the testing, followed by trust in the company. Of lesser significance were "happy if my son or daughter worked there," loyalty and investment confidence (i.e.,"I would be comfortable investing in"). We also found that not all customers care. About one in five respondents are signifi- cantly affected by negative messages - their opinion can shift by more than twenty points. Comparatively, less than ten percent are similarly affected by positive messages.

Our research also shows that companies need to concentrate on building a reservoir of goodwill through consistently strong performance and a history of positive product and customer experiences. While philanthropic activities can contribute another layer, they are rarely sufficient to protect against an attack on one's reputation.The bottom line is that how an organization handles bad news is the most important element in determining its overall corporate reputation. It's in times of crisis that trustmarks are made or lost.

Author's note: This article borrows heavily on the work of Natalie Lacey of Ipsos Public Affairs, who developed the resiliency model. Additional contributors included John Wright,Sandra Guiry, and John Hallward.