Your global reputation depends on local impact

Global reputation management across borders is where local reputation management was in the 1990s.

Global reputation management across borders in 2012 is where local reputation management with multiple stakeholders was in the late 1990s. For US multinationals, it will get harder before it gets easier. Stakeholders at the local level know what they want from you - and they want it their way, not yours.

Stakeholders are more empowered than ever. Consumers are making better-informed decisions and are opting to deal with your company - or not - based on new rules that surely didn't originate from your internal definitions of what success used to look like.

Since the 2008-2009 financial crisis, one of the first rules of the emerging reputation economy is that while exporting a good reputation is hard and takes a good deal of purpose and sweat equity over time, a bad reputation takes on a life of its own and will spread like wildfire whether you like it or not.

The question for communicators then in this new operating environment is simple: how can we have a seat at the table to help organizations better leverage relationships with groups of people who matter around the globe to drive better business outcomes? The early returns are in and it's pretty clear that you won't get there by pumping up the volume of global news releases or dialing up celebrity CEO media tours outside the US.

What works is an "outside-in" approach to stakeholder engagement. Here are a few examples from the front lines - and fault lines - of the reputation economy:

  • Measure, measure, measure - locally. Most companies still don't grasp what stakeholders expect from them outside the US.

Even the best regarded companies in the US find the prospect of funding and fielding regular multi-stakeholder measurement daunting, so a proxy stakeholder (opinion elites or the general public are the two most common) is sometimes chosen instead to get a temperature check outside the US.

FedEx has numerous operating companies and multiple stakeholders it monitors closely in the US, but keeps it simple in the rest of the world where its express division keeps score by measuring perceptions of key opinion leaders every two years across 14 markets.

  • Changes in attitude, changes in latitude. Aflac is a great example of a global company that is in tune with local stakeholder expectations. Although it is based in Columbus, GA, about 70% of its revenue comes from Japan.

In the US, Aflac's Dan Amos was the first Fortune 500 CEO to opt in to "say on pay" in terms of corporate governance and executive compensation, while its four-decade commitment to cancer research proved it was a good corporate citizen before it was "cool" to be so.

Compare this with Aflac Japan's response to the 2011 tsunami. It suspended TV ads featuring its mascot duck and quickly took out newspaper ads offering messages of condolences. Japanese customers affected by the disaster were automatically given a six-month grace period to pay insurance premiums.

Aflac's actions were comparable to what many other Japanese companies did: falling in line with national calls for self-restraint, humility, and sacrifice. In its two largest markets, Aflac unmistakably operates in an authentic and credible way as a local company.

  • Listen to your employees around the world. Virtually every multinational runs annual global employee satisfaction surveys. Savvy communicators can mine that data to see where local staffers are aligned around different values and expectations than global norms. This can serve as a "speed bump" for how external stakeholders such as community activists or politicians will respond.

This reality check can often prevent a global campaign or priority from being rolled out to Bronx cheers. At the least, local employee communications can explain the corporate rationale in a way that is more palatable and relevant to local customs and tastes.

Global capabilities only lead to supportive behavior, such as recommendation or benefit of the doubt in a crisis if they are locally relevant to stakeholders. US companies can do the world a favor by aligning their global ambition and vision with their local capabilities and local stakeholder expectations.

John Patterson is a New York-based senior adviser at Reputation Institute, whose 16th annual international conference theme is "Going Global in the Reputation Economy." It will be held in Milan, Italy, from May 30 to June 1.

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