Shareholders may influence corporate reputation, as described in July's "Can CEOs Defend Corporate America's Image?," but many companies cede control of their investment message to Wall Street analysts. Vision and strategy have been subordinated to guidance and targets.
Take a company's most wide-reaching financial communication, the quarterly earnings release. Most cater to the spreadsheet needs of Wall Street opinion leaders to the exclusion of other stakeholders. CEOs and investors both want a longer-term view not driven by quarterly earnings. Yet you would be challenged to find an earnings release that gives investors simple reasons to invest or stay the course. With new disclosure standards, investors have more information but less understanding.
CEOs should take a cue from American presidents, who must make complex ideas easy to understand. The quarterly earnings release should be a "state of the company" address. CEOs should use the platform to communicate a clear message, define the business strategy, disclose real numbers and address issues such as corporate governance and liquidity head-on. When CEOs reconnect with investors, reputation can be built on a solid footing.
Lisa J. LaMagna
LaMagna Communications Montauk, N.Y.
Reputation vs. Image
It shouldn't take comments from the Federal Reserve chairman about "conceptual assets" and the bankruptcy of some of our largest companies to realize the importance of a corporation's reputation.
Beth Snyder Bulik, in her article, "Can CEOs Defend Corporate America's Image?" (CE: July 2002), correctly assessed that today's corporate chiefs are, as a group, concerned about their companies' respective reputations. However, being concerned about one's reputation and taking action to recreate, maintain or build a company's identity are very different things indeed.
A company must live its brand promise--that which a company promises to deliver to its stakeholders. Reputation and image follow from there. A company's brand is not just a symbol or name, but the culmination of communications and experiences that a customer receives from every contact with a company. To truly succeed and drive profitability, the brand must drive the business strategy. And the employees must live the brand promise. The companies led by CEOs who "get it" will succeed.
Craig Barrett gets it. Intel's set of core values drives its actions. The CEOs of General Electric, WalMart and Southwest get it. Positive image and good reputation are the result of making corporate identity a top priority.
CEOs surveyed in Bulik's article, cited negative media coverage and unethical behavior as the two biggest threats to reputation. Here's an interesting thought: Deal with the No. 2 threat (which is controllable), and the No. 1 threat could be minimized.
No company would list "unethical behavior" as a core value. Nor would it instill in its employees a drive to behave dishonestly. If a CEO and the employees of the company identify a brand promise, articulate it clearly and act upon it, they will truly live up to their potential--and make a bottom line difference in the company's performance.
No company is perfect. The media will always flock to the negative. But the CEO of a company that is true to its brand promise can rest better at night knowing employees are not relying on the company's reputation.
Nina Duseja and Susan Kirchner Managing Partners
Wanted: Corporate Promise Keepers
While Russ Banham's article, "The Whole Truth" (CE: July 2002), outlines several useful ways to measure and disclose business results, CEOs should also recognize that their corporate value statements provide an important yardstick of company performance and management credibility.
Prominent companies vow on their Web sites to behave responsibly as corporate citizens, deliver profitable growth and empower employees. Simultaneously, they are restating financial results, scaling back business plans and announcing layoffs.
CEOs should make sure that long-term corporate values are in sync with short-term realities. Otherwise, the clash between promises and actions can raise serious doubts about a company's credibility at a time when strong relationships with customers, investors and employees are crucial to success.
The management team should honestly assess its corporate values, obtain feedback from key customers and employees and then reassert these values in all communications. Executives also should practice the values they preach. For instance, they should forgo travel perks and share support staff if their company promises to reduce costs and increase profitability for shareholders.
Corporate values are not platitudes and wishful thinking. They are tangible commitments against which all companies should be measured.
Daniel J. Marcus
Nothing to Hide? Tell the World
Thank you for the great straight-shooting suggestions in the August 2002 editor's note: "Four Tips That May Keep You In Office." But you forgot one extraordinarily important tip: Get out and tell everyone your company's good news!
Shareholders have shown they won't tolerate cooked books, rubberstamp boards and half-baked promises. So if you've worked hard to deliver on your promises, aren't in bed with the board and can't cook to save your life, put your best foot forward and tell the world what you're doing right.
Just announced great earnings? Be ready to tell that TV reporter why the numbers were so good, armed with lists of successful initiatives. Hatching expansion plans? Be prepared to explain to the local newscaster why your plans are sound and how the anticipated growth will benefit the company and the economy.
Not comfortable talking with the media? Get comfortable! Practice doing interviews in real settings, such as TV or radio studios, and rehearse in front of the mirror. Get a media coach if you can't do it alone. If you have nothing to hide, tell the world.
Partner and Vice President
SunStar Investor Relations
The Subtleties of Leadership
"The Top 20 Companies for Leaders" article in the June issue was quite interesting. I would have preferred, however, to read some definitions of leadership so that I could see if the executives were thinking along the same lines.
As a consultant in the human performance domain, it's been my experience that leadership is often translated as high potential, head-of-the-class behavior. I've found that the individuals may be managing well, but they're not necessarily inspiring others to achieve. I have worked with high potentials. Often, they perform well yet do not lead people.
What happened to leaders being out front, challenging processes, innovating and inspiring co-workers and encouraging others to learn and experiment? There is more to leadership than coaching and mentoring.
Thank you for pointing out that it is actions that really make the difference. I would hope that leadership is more than positional. Think how high-performing a company could become if everyone were encouraged to express leadership qualities.
Kansas City, Kan.
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|Publication:||Chief Executive (U.S.)|
|Article Type:||Letter to the Editor|
|Date:||Nov 1, 2002|
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