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We enable clients to achieve superior business performance and compelling advocacy through the active understanding and sustainable management of their reputation.
27/04/12

Long-term, low-risk, high yield - how lobbying practices need to change

By Charles Pitt / Category - Public Affairs

Since the Prime Minister helpfully intimated that lobbying the UK was "the next big scandal waiting to happen" the industry has been under considerable pressure. Public suspicion of the UK's great institutions - the police, the media, Parliament - have created an atmosphere in which the individual players are presumed guilty. There is a sense that at the margins of all of these meetings there is some amorphous and unaccountable presence in the form of the paid lobbyist.

While the reality of political engagement is far more banal, this climate presents significant reputational challenges. It is also leading to a considerable re-think in how organisations can most effectively impress their views on policy makers. The industry has grown since the 1980s. While lobbying operated below the radar in the 1960s the number of agencies and individual consultants has grown exponentially. There are estimated to be some 4,000 lobbyists working in the UK with a ratio of 1 to 4 between in-house and in-consultancy practitioners. Given the wide range of services now offered by even small consultancies, the number of individuals engaged in public affairs in its broadest sense must surely be considerably higher. 

As the profession has expanded the range of organisations engaged in active lobbying has broadened. The former preserve of highly regulated industries such as the tobacco industry, lobbying is now a core business function to all; and some of the slickest professionals are lobbying on behalf of the most revered outfits. A glance at the PR Week awards shows how often it is health charities or international aid NGOs whose political campaigning is setting the standard. It is perhaps unfair that just as "good causes" are making political weather in how they persuade and cajole our elected officials, the profession is seen as operating in the shadows.

Against this backdrop the most forward-thinking organisations are recalibrating the terms on which they engage with policy makers and the timescales under which they are operating. Last minute calls with an impassioned plea to drop a clause in some government bill or rethink a local council planning decision is rightly seen as too risky - if you can influence an elected official that readily (and visibly) there is something awry.

The alternative model which is emerging is instead forcing businesses to look ahead three or four years and to engage with policy makers at a far earlier stage. The most thoughtful organisations are learning to put forward policy proposals of their own years before they are likely to be adopted. This approach stands a far better chance of having an impact on emerging government thinking. It is no coincidence that the boom in think tanks has benefited from increased levels of corporate sponsorship. For a CEO the ambition is no longer to be on the golf course with the Prime Minister but to be regarded as a thought leader by his brightest policy advisers.

Overt and aggressive lobbying is a risky business for all involved. But standing apart while your competitors impress the political elite with their foresight and Thought Leadership may be even more dangerous in the long term than calling in shady favours from government ministers.  

13/04/12

As Republican nomination contest ends, Obama emerges as moderate favourite for re-election

By Andrew Hammond / Category - Public Affairs

Following the departure of Rick Santorum from the presidential field, Mitt Romney has now effectively won the Republican nomination to challenge Barack Obama in November.  The presidential election season thus now moves to the next phase, between now and the party conventions in August, whereby Romney and the Republicans must decisively turn their focus of attention onto Obama and winning the White House.  

The bruising Republican nomination contest in recent months has done little to endear Romney to the electorate, especially independents.  He has been caricatured by his Republican opponents as inconsistent in his political positions (a 'flip-flopper'), and out-of-touch with most voters, partly because of his extremely high wealth.

This is reflected in the potentially significant lead that Obama currently has in head-to-head match-up polls against Romney.  Of the approximately 50 national head-to-head opinion surveys taken since the New Year, the president has prevailed in all but five (and three of these apparent outliers were weeks ago in the first half of January).  Since late March, Obama's average polling lead in such surveys has been some 5.3%.

Perhaps more distressingly for Romney are his poor favourability ratings.  Whereas national polls in March gave Obama an average favourability rating of 51.1%, and an average unfavourable rating of 43.6% (a positive spread of +7.5), Romney's corresponding average figures were 36.5% and 47% (a negative spread of -10.4%).  As a result, Romney entered this month with one of the highest ever negative ratings recorded by a major party candidate in US history.     

In this context, some have already declared Obama an overwhelming favourite for re-election.  However, this assessment is overdone and the fact remains that Romney could yet win the White House in November.

It is sometimes forgotten that Obama's job approval ratings as president have been poor (sometimes far below 50%) during the last 12 months.  This largely remains the case, with a majority of national polls in March showing a range of 41-48% approval.  

In the past 40 years, those presidents who have gone on to secure re-election have generally enjoyed job approval ratings in advance of 50% in March of their re-election years as was true of Bill Clinton (1996), Ronald Reagan (1984), and Richard Nixon (1972).  Conversely, the ratings of Gerald Ford (1976), Jimmy Carter (1980), and George H.W. Bush (1992) were all well below 50% at the same point in the electoral cycle and all went on to defeats later the same year.

The only (partial) exception to this trend is George W. Bush in 2004 who went on from average approval ratings of just below or around 50% in March to win a close re-election contest in November.  Obama will thus be repeating a not dissimilar feat as his immediate predecessor in the White House should he go on to win against Romney.

Aside from the salience of the 'war on terror', perhaps the key difference in the US political climates between George W. Bush's re-election year in 2004 and Obama's in 2012 is the weaker economy this time around.  This is underlined in the differences between the unemployment rates in March of both years (5.8% and 8.5% respectively).  

Without question, one of the key remaining drags on Obama's prospects is the high unemployment rate which cursed Ford, Carter and George H.W. Bush in their re-election years.  Indeed, the only president to win re-election in the last 40 years with an unemployment rate above 7% (let alone 8%) was Reagan in 1984.

One of the keys to Reagan's re-election success was the perception by voters in 1984 of robust economic recovery after the recession of the early 1980s.  Throughout 1984, GDP growth was strong and the unemployment rate declined consistently.   

For Obama to win, it would be enormously useful for him to have a similar positive economic headwind going into November.  Here, the still weak unemployment picture has improved in recent months and, if this continues, will undercut Romney's attacks on what he perceives to be Obama's economic mismanagement since 2009. 

Of course, even the relative resilience of Obama's popularity with the electorate, despite the worst downturn since at least the 1930s, does not guarantee him re-election even if the US recovery picks up significantly in coming months.  For instance, numerous political hazards could yet surface, including a potential Israeli attack on Iran, with the potential to reframe the presidential election in an uncertain direction.

Nevertheless, for now at least, the fragile and uneven economic and political environment, including the improving unemployment picture and the legacy of the bruising Republican nomination contest, is underpinning Obama's re-election hopes.  While he not an overwhelming favourite, he currently stands a slightly better than evens prospect of securing a second term.

Original article published in The Times of India, April 13, 2012.
05/04/12

Tough at the top

By Mark Hutcheon / Category - Reputation capability

What do the following CEOs - Stephen Hester, Tony Hayward and James Murdoch - have in common? Bruises gained from battling to rescue damaged personal and corporate reputations. 

Today business leaders serve two masters: profit and reputation.  As a result, they are expected to carry out significant reputational as well as commercial duties dedicating more executive time to being an external ambassador for the business than ever before.  

The climate in which modern CEOs operate can be both unforgiving and intrusive. At a time when trust in business is historically low, CEOs grapple with 24 hour media spotlight, interventionist governments, impatient consumers and powerfully vocal NGOs. Not to mention customers and shareholders.

That reputation management is now a critical competency for CEOs is best illustrated in McKinsey Global Research revealing 50% of all CEOs say managing external affairs ranks as one of their top-three priorities.  If we expect CEOs to act as chief reputation officers, what are the skills needed to succeed and are these supplied by the traditional business school MBA? 

ReputationInc analysed the contents of the FT's Top 50 Business School MBAs  examining whether they teach managers the skills essential to managing corporate reputation. 
The results, to be revealed next week at an event in London, show a gaping hole in the international MBA Curriculum as only 4% teach a dedicated reputation module.  Join me in concluding that the MBA as it stands is failing to equip business leaders with the competencies to succeed in the 'reputation economy.'

Whether they invite it or not, CEOs and business leaders are a proxy or a symbol of the businesses they lead. While the era of the celebrity CEO may have gone with the departure of Steve Jobs, business leaders must still be on message, on values and continually performing to survive the pressurised demands put on them by today's world.  Charlie Mayfield, CEO of John Lewis revealed he committed 30% of his weekly diary to communications, engagement and representing the brand.

Natural gifts as a communicator and leader cannot be taken for granted in business leaders and even then should be complemented with skills in storytelling, understanding public opinion and political engagement. 
The top executive must set the tone and mood of the corporation he leads and continually look for ways to reveal the personality of the company or band and its value to society. CEOs are not born ready to meet this challenge and will benefit from coaching and role play in managing the crown jewel asset of reputation, something today's MBA courses are failing to provide.

Legendary investor Warren Buffett said "It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently."  

Business leaders are starting to get this irrefutably logic, business schools remain some way behind. 

16/03/12

St Patrick's Day: Worldwide Celebration of Ireland's Recovery

By Robert Brown / Category - Reputation Management

Some people would dispute whether St Patrick's Day is at all an Irish celebration or whether it has evolved into something greater, perhaps a global celebration, putting it on a par with other celebrations like that of New Year's Eve. 

Irish people based at home seem to take the holiday for granted and see the festival as more of a traffic inconvenience than an international PR opportunity. When St Patrick's Day comes around each year, international companies the world over suddenly harvest their Irish connections and seek to use it as a platform for promotion on the day. One only has to log onto Google on March 17th where they no doubt will have spiced up their logo with the stereotypical arrangement of shamrocks. 

11 years ago, famed Irish author Maeve Binchy wrote in the New York Times how the Irish used to watch with amazement the television coverage of how our emigrants in America 'whooped up the festivities'. As it turns out, until the mid 1970's, Ireland didn't celebrate St Patrick's Day. In fact it was us who copied our Irish cousins a far in celebrating our own national holiday.

The aim of this year's festivities should be to market our strengthening international poise. Although we still remain shrouded in a cloud of economic uncertainty, we have made significant strides in manufacturing a new, sustainable, and hopefully, exciting Ireland. The challenge herein lies in promoting Ireland as an investment location and to encourage foreign purchases of Irish goods and services. The coming days present us with a unique opportunity to showcase Ireland as a taxation friendly, English speaking, European gateway for Multinational companies and a great place to do business. The opportunity St Patrick's Day presents is unparallel to any other. Who else in the world is guaranteed a meeting with the US president in the White House on the same day every year?

We are very lucky to have St Patrick's Day. St Patrick is to Ireland as Napoleon is to France, George Washington is to the US, and William Shakespeare is to Great Britain. In short, he is what comes to mind as Ireland's most celebrated and iconic historical figure. 

So how do you market a national celebration as a global celebration without losing or endangering its unique selling point? Firstly, a focus on culture should be central to any future advances. This way people are continuously reminded that while it is your party, it's the Irish that we're celebrating. Secondly, we must focus on what foreign people love about Ireland; our people, our countryside, the pubs, the Guinness, the dancing, our literary heroes and of course, the craic. How do we achieve this? Truthfully, in order to do so, and enhance our reputation, we need to be ourselves, not American, and definitely not MTV. 

Today's Ireland is one looking to the future, focussing on innovation as a primary driver in regaining our international reputation. Although the recession did damage us, it also woke us up. We are now beginning to seize the opportunity, focussing on actual strengths, rather than creating artificial ones out of thin air (the Celtic property bubble). 

It would seem that the present government has grasped the bull by the horns this year in that it has doubled the number of Ministers it will be sending abroad to promote business, trade, tourism and investment opportunities. This year's White House ceremony should be especially interesting given that it's election year and President Obama will be looking to capture as many Irish American votes as possible. Obama, a PR phenomenon himself, knows only too well the benefits of draping himself in green each year. Bord Failte, Ireland's national tourist board has come up with the clever idea of turning the world green this Paddy's day. So much so they are looking to change the colour of the iconic Niagara Falls in the United States. This can't be a bad idea. Just like turning the Chicago River green, it captures the imagination and almost certainly the eye. Tabloids the world over will feature pictures of the monstrous waterfall succumbing to the green dye so kindly provided for by the Irish State. 

The unconscious focus of all Irish people over the coming days should be that of reputation recovery. The Irish Government will look to exit the EU-IMF bailout in due course and return to the financial market hopefully sooner. This prospect would become far likelier were we to increase inward investment and international trade, in doing so strengthening our international reputation. St Patrick's Day is a great place from which to continue Ireland's road to recovery.

02/03/12

Dogs, guns and dollars

By Jonathan Chandler / Category - Reputation execution

When The Sun and journalism in general was admired and reviled in more equal measure,  the "legendary" editor Kelvin Mackenzie declared to his staff that there were only seven stories, or "knitting patterns", as he called them.

They ran pretty much along the lines of the seven deadly sins, not surprisingly. It proved to be an excellent filter to make sure the news team focus on what sold the paper. If a story didn't fit the pattern, it wasn't  a story.

This brutal simplicity inspired me to see if could come up with a similar formula  when I was leading Coca-Cola's communications machine in Europe in the 2000s.  We took a wide sweep of what stories "cut through" beyond our industry and of course, the DNA of the stories that worked hard for us and also what flopped.

It resulted - after much  to and fro - with a finite series of "winning plays", some of which would probably work for any icon, in any century,  but some worked uniquely for Coke in the here and now.

This week began with an excellent execution of the most enduring of those plays - the unbeatable image. Rolex topped the Superbrand survey, trailed by Coke, Google and Mercedes-Benz. Not the biggest story in town, and certainly not front page news. But the EIGHTH-ranked Superbrand not only dominated the coverage but put the story on the front page.

How? While the other superstars were having Sunday lunch, the Dulux team were busy putting a crop of pretty 60s styled girls in simple, bright dresses and had them march a posse of Dulux dogs across Westminster Bridge. It was a three card trick. 

- Play number one: the unbeatable image, 
- Play number two: cherish the icon (the dog) 
- Play number three: fill the media envelope (classic Sunday for Monday). 

Easy but blindingly effective.

There was category of plays we invented back then that we called "boomerangs".  Effective, yes, but had a habit of hitting you in the back of the head.  You really needed to examine the "brand fit" and the unintended consequences  before launching one.

Declaring "war" on a smaller competitor, for example,  is a great headline grabber.   At British Airways in the late eighties we were "the World's Favourite" but were bizarrely looking to pick a fight with anyone. Not the smartest move, as I suspected at the time. It  too easily  results in the boomerang effect of a giving greater credit to your rival, and indeed raise the eyebrows of the competition authorities.   

Hopefully (for them) Paddy Power is aiming its boomerangs accurately. They seem pretty determined to get every TV commercial they make banned before it makes the screen. They're certainly reaching me through Youtube shares on Facebook...and I hardly watch any TV at all.  Cute.  First with a "spot the tranny" spoof for  Ascot on Ladies Day, and secondly with a "shoot the chav with a tranquilizer gun"  at the Cheltenham Gold Cup.   The bookmaker is very proud of the results, 500,000 views in the first week and of course, loads of chatter.

This play "go for the ban" is equally well-tried; the Sex Pistols may never have made number one in the UK with God Save the Queen if hadn't been banned by radio.  But in an age when TV commercials are watched less and less, it must make good economic sense for  self-styled controversial brands  to produce ads that provoke outrage and snigger, they move much quicker to our small screens.

But even a ribald crowd like Paddy Power might want to take stock  before picking on another easy target in society to drive notoriety.

The Sun misread its audience on more than one occasion with effects that were long-lasting...not least in Liverpool where their reporting on the Hillsborough tragedy was inaccurate and insensitive.  

As Dulux showed, you an use the oldest trick in the book to eclipse more revered rivals. As Paddy Power are showing, the "dark arts" are still brutally effective.

One of our other plays was "dreams can come true."  Coke has a great track record in bringing magic to life...like the Christmas truck coming to town across Europe.  Perfect realisation of cherished "movie" moment.  "Worst scenario"  a puncture, a delay or Santa falling off his stool.

I'm sure Paddy Power has thought through the consequences of their "movie moment" coming to life at the Cheltenham festival.  That boomerang would really get some airplay.
24/02/12

Coming from a small country: everyone is an ambassador abroad

By Marit Sillavee / Category - Reputation Management

Coming from a small country can sometimes be frustrating. First of all, nobody can pronounce your name. To foreigners, I am Maaarit, Marriot, Married, Marita, Maree or sometimes - just Mary.  Not everyone was born to pronounce a typical Estonian name correctly.
  
And this small point may have big ramifications.  Studies suggest that people with easy-to-pronounce names are more likely to get jobs, get promoted or get elected in parliaments around the world. Not only that - if your surname starts with letters nearer to the beginning of the alphabet, you're more likely to win a Nobel Prize than if your name starts with, for example, an S or a P or a W. Looking at these stats, I'm pretty doomed, at least on an international level.
 
Undoubtedly where you come from influences what your future will be like, and will follow you wherever you go or whatever you do. And Estonia follows me everywhere. The first thing people hear is, my eastern European accent when I speak English, and the second stumbling block is my difficult-to-pronounce name. The typical next step is to then explain that I come from Estonia, which opens up a whole other can of worms.
  
Yes, I patiently reply, Estonia is a country.  The blurb goes on from there.  We are located just below Finland and on top of Latvia, with Russia on the right.  Estonia is about the size of the Netherlands but only has 1.3 million people, and we speak Estonian, which is close to Finnish. 

Many people I've met are familiar with some of all of the basics, but many have no clue. When I first moved abroad five years ago, I was very enthusiastic about explaining the background of my country, but after a while it gets tiring. And by now I've learned not to blame the foreigners that they don't know what or where Estonia is.  Rather, it's the fault of my own country's leadership for failing to ensure that its voice is being heard at a global level. 

Reading the local Estonian news on a daily basis, I often find little nuggets that would make perfect international news coverage, but it rarely, if ever, breaks news outside of Tallinn (our capital, if you were wondering!)

I struggle to understand why this is - there are lots of talented, well educated Estonians, people who definitely have the skills to bring our reputation to a whole new level, but this is not done. VisitEstonia is a great site with lots of info, but tourism alone is not enough. For instance, in the section 'What is so special about Estonia?' the site mentions forests, wild animals, birds. There is definitely a lot more to see and do than wander in a forest and watch wild animals and birds!

I wonder if we just haven't found our special USP yet, the kind of image or activity that would capture to world's imagination - like the Sydney Opera House for Australia, the Eiffel Tower for France, Oil for Norway, and the fashion and food of our Italy. Therefore, all Estonians living abroad are responsible for projecting the image of Estonia to foreigners. I worry about this approach - as it is never wise to give up control of the task of reputation management voluntarily. Some Estonians do an excellent job in promoting the country abroad and being good cultural ambassadors, but inevitably, others risk bringing it down. 

How should Estonia fix its reputation conundrum? Building a positive image and reputation takes time, but should start from the inside. There seems to be no coordinated outreach on the pan-European level - otherwise we would make it to the international news with more interesting stuff instead of 'Estonian bus drivers' wages' or how some students in Estonia decided to move in to medieval houses in the winter to try out how it was living during the iron age. No strategic thinking here...So where should our national messaging begin?
 
If Estonia does not want to leave its reputation management up to the diverse group of Estonian expats living abroad, something needs to be done. Applying some of the basic principles of reputation management, I would suggest we:

  • First of all, start with stakeholder audit.  Find out how the country is perceived today by other countries and influencers. Knowing where we stand will help in understanding the strengths and weaknesses of Estonia's reputation.

  • Reputation is owned by everyone - not just the communicators.  Building country reputation should not be the task of any one national tourism organisation. The government, businesses, arts, education and media should cooperate with them in deciding upon the strategy and key messages.  

  • In corporate reputation management we often say that it is essential to get 'internal buy-in from the employees' before starting influencing external stakeholders. So, before starting reaching out, it will be essential to ensure that the local people are happy with the image that is being communicated.

Country branding reputation strategy is not easy, I know. And in the meantime I don't mind continuing my work as one of Estonia's most passionate cultural ambassadors. My call to action to my fellow citizens is to start thinking about the reputation management of our great country more strategically in order to achieve growth, and build a more positive recognition at the international level. Who is bold enough to act?

 

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