Companies must redefine their portfolio in such a way that people will perceive it as having added value for their personal lives, says RSM's Professor Cees van Riel, an expert in reputation management – and there's good reason for the world's biggest companies to believe him

Morris, R. (Rebecca)

Riel, C.B.M. (Cees) van

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ROTTERDAM SCHOOL OF MANAGEMENT, ERASMUS UNIVERSITYThe business school that thinks and lives in the future Future trends in  reputation managementRebecca Morris talks with Cees van RielHonesty presents  a challenge in  performance reportingBy Marcel van Rinsum  Putting servant leadership  to the testBy Milton Sousa Identity and identity  conflict in the workplaceBy Kate E. Horton, P. Saskia Bayerl and Gabriele Jacobs  Mapping strategic  consensus within and between teamsBy Murat Tarakci  Trade-offs in the  adoption of sustain-ability standardsBy Frank Wijen Making better  partner matches in brand alliancesBy Bram Van den Bergh 3rd Quarter 2014Management KnowledgeRSM DISCOVERY3rd Quarter 2014   |   05Future trends in reputation managementRebecca Morris talks with Cees van RielMany factors contribute to the strength of a company's reputation. Of those that will be of most influence in the coming five years, we are now in a better position to know, thanks to a study performed by researchers at RSM's Corporate Communication Centre (CCC).Researchers conducting the study identified seven key trends they pre-dict will drive reputation management Companies must redefine their portfolio in such a way that people will perceive it as having added value for their personal lives, says RSM's Professor Cees van Riel, an expert in reputation management – and there's good reason for the world's biggest companies to believe him.in 2020, showcasing their results at a conference held on 26 September of this year. The conference was held to commemorate the 25th anniversary of the school's Corporate Communication Centre and the inauguration of a spin-off institute dedicated exclusively to reputation research – and to cele-brate the considerable achievements of the centre's founder and director, Professor Cees van Riel.Professor Van Riel established the centre with the support of the business community in 1989. Over the past 25 years, not only has he propelled RSM to the global forefront of the field, but he has also reshaped the reputation management discipline itself.Twenty Dutch companies this year nominated him to the Civil Order of Orange-Nassau, a Dutch royal medal of distinction for societal contribution, which was presented to him by Mayor of Rotterdam, Ahmed Aboutaleb, on behalf of King Willem-Alexander. ‘Professor Van Riel,’ he said, ‘had put the field of reputation management on the global map, and in the process placed the Netherlands in a prominent position. His vision has contributed to the reputation of Dutch brands and thus to a more positive image of the Netherlands worldwide.’Reputation tracking toolAn important research priority at the CCC has been the development of tools that can objectively measure reputa-tion and employee alignment; tools that can, says Van Riel, allow commu-nications professionals to translate soft data into hard, quantitative statistics that will ‘simplify discussions with top management’. The development of RepTrak in 1999 was the groundbreaking first step. RepTrak is now broadly accepted as the worldwide standard methodology for tracking an organisation's reputation, paving the way for an extensive body of literature and further studies, includ-ing their own annual Global RepTrak Pulse – the world's largest reputation One important trend is the “Big Data management revolution”, says Van Riel. By 2020, Big Data will dominate the way companies manage their repu-tation, he says. Reputation data will be integrated into all enterprise data – in-cluding market research and financial data – and it will no longer be primarily used by corporate communications. This trend reflects the extensive im-pact of the RepTrak tool. ‘What you see is that over the last twenty five years the quantification of research in repu-tation management, something I’ve invested heavily in, has increased im-mensely,’ he says. ‘This technology has created a revolution in how companies manage their reputations.’ But of all seven trends, the most in-fluential on how high a business ranks in reputation will be the degree to which it can show its social relevance, he says. Social relevance implies that you have products and services that are perceived by large stakeholder groups of society as having added value for their personal life. Social relevance can be expressed purely via the actual nature of the busi-ness. A good example, he says, is hos-pitals, by definition more socially rel-evant than any company in the world and thus high on reputation rankings. Social relevance can also be shown through the value of products and ser-vices to a large group of stakeholders – but only so long as that relevance is clearly communicated. An excellent example is Philips. LEDs, for instance, is a technology that decreases the cost of electricity for study that measures more than 2,000 companies from 25 industries across 40 countries.‘RepTrak has allowed us to assem-ble the largest normative database in the world for companies to benchmark against and provide context for deci-sion making,’ says Van Riel. ‘It allows companies to understand which driv-ers have the greatest effect and to identify the behavioural consequences of a good reputation: a willingness to purchase, to work for, or to invest in, all crucial indicators for achieving align-ment with the stakeholders on which a company depends.’A good example, he says, is KPN. ‘We showed them in detail the drivers of their reputation. Eelco Blok, the CEO of KPN and one of the keynote speak-ers at the conference said, “Cees, we have learned from your research that we have to be more socially relevant. We will do it. We will invest in it.” and he has.’Professor Van Riel's partnership with Stern Business School's Professor Charles Fombrun has led to a prolif-eration of other high-profile research projects and initiatives, including the founding of the academic journal Corporate Reputation Review and the creation of the prestigious US-based Reputation Institute (RI) – a global hub for reputation research co-directed by Van Riel.As for companies – co-operation be-tween the CCC and the business world was formalised eight years ago with the formation of the Reputation fo-rum the Netherlands (RfN), a platform where directors of corporate communi-cation from the 25 largest Dutch firms meet four times a year to discuss the latest developments in the profession. Seven key trendsThe study on future trends in reputa-tion management for 2020, conduct-ed by Professor Van Riel and Marijke Baumann, involved a series of focus group discussions across the globe with CCOs, high-potential business executives, corporate communication directors and graduate students. From these discussions, they identi-fied seven trends they predict will drive reputation management in 2020.“RepTrak has allowed us to assemble the largest normative database in the world for companies to benchmark against and provide context for decision making.” 06   |   3rd Quarter 2014Future trends in reputation management (continued)Rebecca Morris talks with Cees van RielManagement KnowledgeRSM DISCOVERYreputations, why they varied, and how organisations within these industries could improve them.Three industries were selected with reputations ranking from positive to negative: food, chemicals, and bank-ing. Messages pertaining to the 20 largest companies in each sector were analysed at the firm level, the indus-try association level and among major media, and combined with a survey of three stakeholder groups.The first conclusion of the study was that companies are responsible for their own reputation. Most articles generated by the banks themselves were negative, for instance. Of those people and municipalities and creates liveable sustainable cities. But importantly, social relevance can be achieved irrespective of the products or services offered by the company. ‘Companies that stress their social relevance rise in their rep-utation regardless of their portfolio,’ he says.  Don't be negativeIt's not as complicated as it might sound. The results of a huge industry study conducted by researchers at the CCC – also showcased at the con-ference this September – examined three different industries and their generated by chemical companies, most were positive; and those by food companies – very positive. ‘Banks are constantly talking neg-atively about themselves and their whole line of industry,’ says Van Riel. ‘They are in the defence position due to the financial crisis, and all communica-tion is coming from negative assump-tions and therefore reinforcing these negative messages.’Other conclusions of the study were that media coverage impacts reputa-tion less than we might expect, and that stakeholders assess industries mainly on social relevance.‘If banks, just like the food indus-try, would stress more about what the added value is for individuals and soci-ety at large in relation to what they are doing and support that with evidence in their daily behaviour – their reputa-tion would change.’In other words – companies create their own negative or positive reputa-tions primarily on the basis of what they express about their own social relevance, irrespective of their prod-ucts or services.‘The most important conclusion of that study,' says Van Riel, 'is that what companies express about themselves regarding their social contribution will determine whether or not they are per-ceived in a positive or negative light. There is no doubt that if you change your message, the perception will also change.'  For more information on the activities of the Corporate Communication Centre, please visit  WEB  www.rsm.nl/ccc“…over the last twenty five years the quan-tification of research in reputation manage-ment, something I’ve invested heavily in, has increased immensely.”3rd Quarter 2014   |   07

Future trends in reputation management

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